BEAR STEARNS ASSET BACKED SECURITIES I LLC, Depositor, EMC MORTGAGE CORPORATION, Seller and Company, LASALLE BANK NATIONAL ASSOCIATION, Master Servicer and Securities Administrator, and CITIBANK, N.A. Trustee POOLING AND SERVICING AGREEMENT Dated as...
BEAR
XXXXXXX ASSET BACKED SECURITIES I LLC,
Depositor,
EMC
MORTGAGE CORPORATION,
Seller
and Company,
LASALLE
BANK NATIONAL ASSOCIATION,
Master
Servicer and Securities Administrator,
and
CITIBANK,
N.A.
Trustee
Dated
as
of August 1, 2006
MORTGAGE-BACKED
CERTIFICATES, SERIES 2006-9
TABLE
OF CONTENTS
ARTICLE
I
DEFINITIONS
|
Section
1.01
|
Defined
Terms.
|
|
Section
1.02
|
Allocation
of Certain Interest Shortfalls.
|
ARTICLE
II
CONVEYANCE OF TRUST FUND REPRESENTATIONS AND WARRANTIES
|
Section
2.01
|
Conveyance
of Trust Fund.
|
|
Section
2.02
|
Acceptance
of the Mortgage Loans.
|
|
Section
2.03
|
Representations,
Warranties and Covenants of the Company, the Master Servicer, and
EMC as
Seller.
|
|
Section
2.04
|
Representations
and Warranties of the Depositor.
|
|
Section
2.05
|
Delivery
of Opinion of Counsel in Connection with Substitutions and
Repurchases.
|
|
Section
2.06
|
Countersignature
and Delivery of Certificates.
|
|
Section
2.07
|
Purposes
and Powers of the Trust.
|
ARTICLE
III
ADMINISTRATION AND SERVICING OF EMC MORTGAGE LOANS BY THE COMPANY
|
Section
3.01
|
The
Company.
|
|
Section
3.02
|
Due-on-Sale
Clauses; Assumption Agreements.
|
|
Section
3.03
|
Subservicers.
|
|
Section
3.04
|
Documents,
Records and Funds in Possession of the Company to Be Held for
Trustee.
|
|
Section
3.05
|
Optional
Purchase of Certain Mortgage Loans.
|
|
Section
3.06
|
Release
of Mortgage Files.
|
|
Section
3.07
|
Maintenance
of Hazard Insurance.
|
|
Section
3.08
|
Presentment
of Claims and Collection of Proceeds.
|
|
Section
3.09
|
Books
and Records.
|
|
Section
3.10
|
Custodians
to Retain Possession of Certain Insurance Policies and
Documents.
|
|
Section
3.11
|
Fidelity
Bond, Errors and Omissions Insurance.
|
|
Section
3.12
|
Realization
Upon Defaulted Mortgage Loans; Determination of Excess Liquidation
Proceeds and Realized Losses; Repurchases of Certain Mortgage
Loans.
|
|
Section
3.13
|
Servicing
Compensation.
|
|
Section
3.14
|
REO
Property.
|
|
Section
3.15
|
Liquidation
Reports.
|
|
Section
3.16
|
Annual
Statement as to Compliance.
|
|
Section
3.17
|
Assessments
of Compliance and Attestation Reports.
|
|
Section
3.18
|
Reports
Filed with Securities and Exchange Commission.
|
|
Section
3.19
|
Intention
of the Parties and Interpretation.
|
ARTICLE
IV
MASTER
SERVICING OF MORTGAGE LOANS BY MASTER SERVICER
|
Section
4.01
|
Master
Servicer.
|
|
Section
4.02
|
Monitoring
of Company and Servicer.
|
|
Section
4.03
|
Fidelity
Bond.
|
|
Section
4.04
|
Power
to Act; Procedures.
|
|
Section
4.05
|
Due-on-Sale
Clauses; Assumption Agreements.
|
|
Section
4.06
|
Documents,
Records and Funds in Possession of Master Servicer, Company and Servicer
To Be Held for Trustee.
|
|
Section
4.07
|
Presentment
of Claims and Collection of Proceeds.
|
|
Section
4.08
|
Realization
Upon Defaulted Mortgage Loans.
|
|
Section
4.09
|
Compensation
of the Master Servicer.
|
|
Section
4.10
|
REO
Property.
|
|
Section
4.11
|
[Reserved].
|
|
Section
4.12
|
[Reserved].
|
|
Section
4.13
|
UCC.
|
|
Section
4.14
|
Reserve
Fund; Payments to and from Swap Administrator; Supplemental Interest
Trust.
|
|
Section
4.15
|
Reserved.
|
|
Section
4.16
|
Tax
Treatment of Class IO Distribution Amounts in the Event of
Resecuritization of Class A, Class M or Class B
Certificates.
|
ARTICLE
V
ACCOUNTS
|
Section
5.01
|
Collection
of Mortgage Loan Payments; Protected Account.
|
|
Section
5.02
|
Permitted
Withdrawals From the Protected Account.
|
|
Section
5.03
|
Reports
to the Master Servicer.
|
|
Section
5.04
|
Collection
of Taxes; Assessments and Similar Items; Escrow Accounts.
|
|
Section
5.05
|
Protected
Accounts.
|
|
Section
5.06
|
Master
Servicer Collection Account.
|
|
Section
5.07
|
Permitted
Withdrawals and Transfers from the Master Servicer Collection
Account.
|
|
Section
5.08
|
Distribution
Account.
|
|
Section
5.09
|
Permitted
Withdrawals and Transfers from the Distribution Account.
|
ARTICLE
VI
DISTRIBUTIONS AND ADVANCES
|
Section
6.01
|
Advances.
|
|
Section
6.02
|
Compensating
Interest Payments.
|
|
Section
6.03
|
REMIC
Distributions.
|
|
Section
6.04
|
Distributions.
|
|
Section
6.05
|
Allocation
of Realized Losses.
|
|
Section
6.06
|
Monthly
Statements to Certificateholders.
|
|
Section
6.07
|
REMIC
Designations and REMIC Distributions.
|
ARTICLE
VII
THE
CERTIFICATES
|
Section
7.01
|
The
Certificates.
|
|
Section
7.02
|
Certificate
Register; Registration of Transfer and Exchange of
Certificates.
|
|
Section
7.03
|
Mutilated,
Destroyed, Lost or Stolen Certificates.
|
|
Section
7.04
|
Persons
Deemed Owners.
|
|
Section
7.05
|
Access
to List of Certificateholders’ Names and Addresses.
|
|
Section
7.06
|
Book-Entry
Certificates.
|
|
Section
7.07
|
Notices
to Depository.
|
|
Section
7.08
|
Definitive
Certificates.
|
|
Section
7.09
|
Maintenance
of Office or Agency.
|
ARTICLE
VIII
THE
DEPOSITOR, THE COMPANY AND THE MASTER SERVICER
|
Section
8.01
|
Liabilities
of the Depositor, the Company and the Master Servicer.
|
|
Section
8.02
|
Merger
or Consolidation of the Depositor, the Company or the Master
Servicer.
|
|
Section
8.03
|
Indemnification
of the Trustee, the Master Servicer and the Securities
Administrator.
|
|
Section
8.04
|
Limitations
on Liability of the Depositor, the Company, the Master Servicer and
Others.
|
|
Section
8.05
|
Master
Servicer and Company Not to Resign.
|
|
Section
8.06
|
Successor
Master Servicer.
|
|
Section
8.07
|
Sale
and Assignment of Master Servicing.
|
ARTICLE
IX
DEFAULT;
TERMINATION OF MASTER SERVICER; TERMINATION OF COMPANY
|
Section
9.01
|
Events
of Default.
|
|
Section
9.02
|
Trustee
to Act; Appointment of Successor.
|
|
Section
9.03
|
Notification
to Certificateholders.
|
|
Section
9.04
|
Waiver
of Defaults.
|
|
Section
9.05
|
Company
Default.
|
|
Section
9.06
|
Waiver
of Company Defaults.
|
ARTICLE
X
CONCERNING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
|
Section
10.01
|
Duties
of Trustee and the Securities Administrator.
|
|
Section
10.02
|
Certain
Matters Affecting the Trustee and the Securities
Administrator.
|
|
Section
10.03
|
Trustee
and Securities Administrator Not Liable for Certificates or Mortgage
Loans.
|
|
Section
10.04
|
Trustee
and Securities Administrator May Own Certificates.
|
|
Section
10.05
|
Trustee’s
and Securities Administrator’s Fees and Expenses.
|
|
Section
10.06
|
Eligibility
Requirements for Trustee and Securities Administrator.
|
|
Section
10.07
|
Insurance.
|
|
Section
10.08
|
Resignation
and Removal of Trustee and Securities Administrator.
|
|
Section
10.09
|
Successor
Trustee or Securities Administrator.
|
|
Section
10.10
|
Merger
or Consolidation of Trustee or Securities Administrator.
|
|
Section
10.11
|
Appointment
of Co-Trustee or Separate Trustee.
|
|
Section
10.12
|
Tax
Matters.
|
|
Section
10.13
|
REMIC-Related
Covenants.
|
ARTICLE
XI
TERMINATION
|
Section
11.01
|
Termination
upon Liquidation or Repurchase of all Mortgage Loans.
|
|
Section
11.02
|
Final
Distribution on the Certificates.
|
|
Section
11.03
|
Additional
Termination Requirements.
|
ARTICLE
XII
MISCELLANEOUS PROVISIONS
|
Section
12.01
|
Amendment.
|
|
Section
12.02
|
Recordation
of Agreement; Counterparts.
|
|
Section
12.03
|
Governing
Law.
|
|
Section
12.04
|
Intention
of Parties.
|
|
Section
12.05
|
Notices.
|
|
Section
12.06
|
Severability
of Provisions.
|
|
Section
12.07
|
Assignment.
|
|
Section
12.08
|
Limitation
on Rights of Certificateholders.
|
|
Section
12.09
|
Inspection
and Audit Rights.
|
|
Section
12.10
|
Certificates
Nonassessable and Fully Paid.
|
|
Section
12.11
|
Third
Party Rights.
|
Exhibits
|
Exhibit
A-1
|
Form
of Class A Certificates
|
|
Exhibit
A-2
|
Form
of Class M Certificates
|
|
Exhibit
A-3
|
Form
of Class B Certificates
|
|
Exhibit
A-4
|
Form
of Class C Certificates
|
|
Exhibit
A-5
|
Form
of Class R Certificates
|
|
Exhibit
B
|
Mortgage
Loan Schedule
|
|
Exhibit
C
|
Form
of Transfer Affidavit
|
|
Exhibit
D
|
Form
of Transferor Certificate
|
|
Exhibit
E
|
Form
of Investment Letter (Non-Rule 144A)
|
|
Exhibit
F
|
Form
of Rule 144A and Related Matters Certificate
|
|
Exhibit
G
|
Form
of Request for Release
|
|
Exhibit
H
|
DTC
Letter of Representations
|
|
Exhibit
I
|
Schedule
of Mortgage Loans with Lost Notes
|
|
Exhibit
J
|
Form
of LaSalle Custodial Agreement
|
|
Exhibit
K
|
Form
of Xxxxx Fargo Custodial Agreement
|
|
Exhibit
L
|
Form
of Mortgage Loan Purchase Agreement
|
|
Exhibit
M
|
Form
of Back-Up Certification
|
|
Exhibit
N
|
Swap
Agreement
|
|
Exhibit
O
|
Servicing
Criteria to Be Addressed in Assessment of Compliance
|
|
Exhibit
P
|
Form
10-D, Form 8-K and Form 10-K Reporting Responsibility
|
|
Exhibit
Q
|
Additional
Disclosure Notification
|
|
Exhibit
R-1
|
Form
of First Horizon Servicing Agreement
|
|
Exhibit
R-2
|
Form
of First Horizon Assignment, Assumption and Recognition
Agreement
|
|
Exhibit
S-1
|
Form
of GMACM Servicing Agreement
|
|
Exhibit
S-2
|
Form
of GMACM Assignment, Assumption and Recognition
Agreement
|
|
Exhibit
T-1
|
Form
of HomeBanc Servicing Agreement
|
|
Exhibit
T-2
|
Form
of HomeBanc Assignment, Assumption and Recognition
Agreement
|
POOLING
AND SERVICING AGREEMENT, dated as of August 1, 2006, among BEAR XXXXXXX ASSET
BACKED SECURITIES I LLC, a Delaware limited liability company, as depositor
(the
“Depositor”), EMC MORTGAGE CORPORATION, a Delaware corporation, as seller (in
such capacity, the “Seller”) and as company (in such capacity, the “Company”),
LASALLE BANK NATIONAL ASSOCIATION, a national banking association, as master
servicer (in such capacity, the “Master Servicer”) and as securities
administrator (in such capacity, the “Securities Administrator”), and CITIBANK,
N.A., a national banking association, as trustee (the “Trustee”).
PRELIMINARY
STATEMENT
The
Depositor is the owner of the Trust Fund that is hereby conveyed to the Trustee
in return for the Certificates. On or prior to the Closing Date, the Depositor
acquired the Mortgage Loans from the Seller. On the Closing Date, the Depositor
will sell the Mortgage Loans and certain other property to the Trust Fund and
receive in consideration therefor Certificates evidencing the entire beneficial
ownership interest in the Trust Fund.
REMIC
I
As
provided herein, the Securities Administrator, on behalf of the Trustee will
elect to treat the segregated pool of assets consisting of the Mortgage Loans
and certain other related assets subject to this Agreement (other than the
Reserve Fund, any Prepayment Charge Waiver Amounts and, for the avoidance of
doubt, the Supplemental Interest Trust, the Swap Agreement, the Swap Account
and
any rights or obligations in respect of the Swap Administration Agreement)
as a
REMIC (as defined herein) for federal income tax purposes, and such segregated
pool of assets will be designated as “REMIC I”. The Class R-1 Certificates will
represent the sole class of Residual Interests (as defined herein) in REMIC
I
for purposes of the REMIC Provisions (as defined herein). The following table
irrevocably sets forth the designation, the Uncertificated REMIC I Pass-Through
Rate, the initial Uncertificated Principal Balance and, for purposes of
satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii), the “latest possible
maturity date” for each of the REMIC I Regular Interests (as defined herein).
None of the REMIC I Regular Interests will be certificated.
|
Designation
|
Uncertificated
REMIC I
Pass-Through
Rate
|
Initial
Uncertificated Principal Balance
|
Latest
Possible Maturity Date (1)
|
|||||||
|
I-1-A
|
Variable(2)
|
|
$
|
8,218,004.31
|
August
25, 2036
|
|||||
|
I-1-B
|
Variable(2)
|
|
$
|
8,218,004.31
|
August
25, 2036
|
|||||
|
I-2-A
|
Variable(2)
|
|
$
|
7,926,500.00
|
August
25, 2036
|
|||||
|
I-2-B
|
Variable(2)
|
|
$
|
7,926,500.00
|
August
25, 2036
|
|||||
|
I-3-A
|
Variable(2)
|
|
$
|
7,645,000.00
|
August
25, 2036
|
|||||
|
I-3-B
|
Variable(2)
|
|
$
|
7,645,000.00
|
August
25, 2036
|
|||||
|
I-4-A
|
Variable(2)
|
|
$
|
7,374,000.00
|
August
25, 2036
|
|||||
|
I-4-B
|
Variable(2)
|
|
$
|
7,374,000.00
|
August
25, 2036
|
|||||
|
I-5-A
|
Variable(2)
|
|
$
|
7,112,500.00
|
August
25, 2036
|
|||||
|
I-5-B
|
Variable(2)
|
|
$
|
7,112,500.00
|
August
25, 2036
|
|||||
|
I-6-A
|
Variable(2)
|
|
$
|
6,859,500.00
|
August
25, 2036
|
|||||
|
I-6-B
|
Variable(2)
|
|
$
|
6,859,500.00
|
August
25, 2036
|
|||||
|
I-7-A
|
Variable(2)
|
|
$
|
6,616,500.00
|
August
25, 2036
|
|||||
|
I-7-B
|
Variable(2)
|
|
$
|
6,616,500.00
|
August
25, 2036
|
|||||
|
I-8-A
|
Variable(2)
|
|
$
|
6,381,500.00
|
August
25, 2036
|
|||||
|
I-8-B
|
Variable(2)
|
|
$
|
6,381,500.00
|
August
25, 2036
|
|||||
|
I-9-A
|
Variable(2)
|
|
$
|
6,155,000.00
|
August
25, 2036
|
|||||
|
I-9-B
|
Variable(2)
|
|
$
|
6,155,000.00
|
August
25, 2036
|
|||||
|
I-10-A
|
Variable(2)
|
|
$
|
5,936,500.00
|
August
25, 2036
|
|||||
|
I-10-B
|
Variable(2)
|
|
$
|
5,936,500.00
|
August
25, 2036
|
|||||
|
I-11-A
|
Variable(2)
|
|
$
|
5,726,000.00
|
August
25, 2036
|
|||||
|
I-11-B
|
Variable(2)
|
|
$
|
5,726,000.00
|
August
25, 2036
|
|||||
|
I-12-A
|
Variable(2)
|
|
$
|
5,522,500.00
|
August
25, 2036
|
|||||
|
I-12-B
|
Variable(2)
|
|
$
|
5,522,500.00
|
August
25, 2036
|
|||||
|
I-13-A
|
Variable(2)
|
|
$
|
5,326,500.00
|
August
25, 2036
|
|||||
|
I-13-B
|
Variable(2)
|
|
$
|
5,326,500.00
|
August
25, 2036
|
|||||
|
I-14-A
|
Variable(2)
|
|
$
|
5,137,000.00
|
August
25, 2036
|
|||||
|
I-14-B
|
Variable(2)
|
|
$
|
5,137,000.00
|
August
25, 2036
|
|||||
|
I-15-A
|
Variable(2)
|
|
$
|
4,955,000.00
|
August
25, 2036
|
|||||
|
I-15-B
|
Variable(2)
|
|
$
|
4,955,000.00
|
August
25, 2036
|
|||||
|
I-16-A
|
Variable(2)
|
|
$
|
4,779,000.00
|
August
25, 2036
|
|||||
|
I-16-B
|
Variable(2)
|
|
$
|
4,779,000.00
|
August
25, 2036
|
|||||
|
I-17-A
|
Variable(2)
|
|
$
|
4,609,000.00
|
August
25, 2036
|
|||||
|
I-17-B
|
Variable(2)
|
|
$
|
4,609,000.00
|
August
25, 2036
|
|||||
|
I-18-A
|
Variable(2)
|
|
$
|
4,445,500.00
|
August
25, 2036
|
|||||
|
I-18-B
|
Variable(2)
|
|
$
|
4,445,500.00
|
August
25, 2036
|
|||||
|
I-19-A
|
Variable(2)
|
|
$
|
4,287,500.00
|
August
25, 2036
|
|||||
|
I-19-B
|
Variable(2)
|
|
$
|
4,287,500.00
|
August
25, 2036
|
|||||
|
I-20-A
|
Variable(2)
|
|
$
|
4,135,500.00
|
August
25, 2036
|
|||||
|
I-20-B
|
Variable(2)
|
|
$
|
4,135,500.00
|
August
25, 2036
|
|||||
|
I-21-A
|
Variable(2)
|
|
$
|
3,988,000.00
|
August
25, 2036
|
|||||
|
I-21-B
|
Variable(2)
|
|
$
|
3,988,000.00
|
August
25, 2036
|
|||||
|
I-22-A
|
Variable(2)
|
|
$
|
3,847,000.00
|
August
25, 2036
|
|||||
|
I-22-B
|
Variable(2)
|
|
$
|
3,847,000.00
|
August
25, 2036
|
|||||
|
I-23-A
|
Variable(2)
|
|
$
|
3,710,000.00
|
August
25, 2036
|
|||||
|
I-23-B
|
Variable(2)
|
|
$
|
3,710,000.00
|
August
25, 2036
|
|||||
|
I-24-A
|
Variable(2)
|
|
$
|
3,578,000.00
|
August
25, 2036
|
|||||
|
I-24-B
|
Variable(2)
|
|
$
|
3,578,000.00
|
August
25, 2036
|
|||||
|
I-25-A
|
Variable(2)
|
|
$
|
3,451,000.00
|
August
25, 2036
|
|||||
|
I-25-B
|
Variable(2)
|
|
$
|
3,451,000.00
|
August
25, 2036
|
|||||
|
I-26-A
|
Variable(2)
|
|
$
|
3,328,500.00
|
August
25, 2036
|
|||||
|
I-26-B
|
Variable(2)
|
|
$
|
3,328,500.00
|
August
25, 2036
|
|||||
|
I-27-A
|
Variable(2)
|
|
$
|
3,210,000.00
|
August
25, 2036
|
|||||
|
I-27-B
|
Variable(2)
|
|
$
|
3,210,000.00
|
August
25, 2036
|
|||||
|
I-28-A
|
Variable(2)
|
|
$
|
3,096,000.00
|
August
25, 2036
|
|||||
|
I-28-B
|
Variable(2)
|
|
$
|
3,096,000.00
|
August
25, 2036
|
|||||
|
I-29-A
|
Variable(2)
|
|
$
|
2,986,000.00
|
August
25, 2036
|
|||||
|
I-29-B
|
Variable(2)
|
|
$
|
2,986,000.00
|
August
25, 2036
|
|||||
|
I-30-A
|
Variable(2)
|
|
$
|
2,880,000.00
|
August
25, 2036
|
|||||
|
I-30-B
|
Variable(2)
|
|
$
|
2,880,000.00
|
August
25, 2036
|
|||||
|
I-31-A
|
Variable(2)
|
|
$
|
2,777,500.00
|
August
25, 2036
|
|||||
|
I-31-B
|
Variable(2)
|
|
$
|
2,777,500.00
|
August
25, 2036
|
|||||
|
I-32-A
|
Variable(2)
|
|
$
|
2,678,500.00
|
August
25, 2036
|
|||||
|
I-32-B
|
Variable(2)
|
|
$
|
2,678,500.00
|
August
25, 2036
|
|||||
|
I-33-A
|
Variable(2)
|
|
$
|
2,583,500.00
|
August
25, 2036
|
|||||
|
I-33-B
|
Variable(2)
|
|
$
|
2,583,500.00
|
August
25, 2036
|
|||||
|
I-34-A
|
Variable(2)
|
|
$
|
2,491,500.00
|
August
25, 2036
|
|||||
|
I-34-B
|
Variable(2)
|
|
$
|
2,491,500.00
|
August
25, 2036
|
|||||
|
I-35-A
|
Variable(2)
|
|
$
|
2,403,000.00
|
August
25, 2036
|
|||||
|
I-35-B
|
Variable(2)
|
|
$
|
2,403,000.00
|
August
25, 2036
|
|||||
|
I-36-A
|
Variable(2)
|
|
$
|
2,317,500.00
|
August
25, 2036
|
|||||
|
I-36-B
|
Variable(2)
|
|
$
|
2,317,500.00
|
August
25, 2036
|
|||||
|
I-37-A
|
Variable(2)
|
|
$
|
2,235,500.00
|
August
25, 2036
|
|||||
|
I-37-B
|
Variable(2)
|
|
$
|
2,235,500.00
|
August
25, 2036
|
|||||
|
I-38-A
|
Variable(2)
|
|
$
|
2,155,500.00
|
August
25, 2036
|
|||||
|
I-38-B
|
Variable(2)
|
|
$
|
2,155,500.00
|
August
25, 2036
|
|||||
|
I-39-A
|
Variable(2)
|
|
$
|
2,079,000.00
|
August
25, 2036
|
|||||
|
I-39-B
|
Variable(2)
|
|
$
|
2,079,000.00
|
August
25, 2036
|
|||||
|
I-40-A
|
Variable(2)
|
|
$
|
2,005,000.00
|
August
25, 2036
|
|||||
|
I-40-B
|
Variable(2)
|
|
$
|
2,005,000.00
|
August
25, 2036
|
|||||
|
I-41-A
|
Variable(2)
|
|
$
|
1,933,500.00
|
August
25, 2036
|
|||||
|
I-41-B
|
Variable(2)
|
|
$
|
1,933,500.00
|
August
25, 2036
|
|||||
|
I-42-A
|
Variable(2)
|
|
$
|
1,865,000.00
|
August
25, 2036
|
|||||
|
I-42-B
|
Variable(2)
|
|
$
|
1,865,000.00
|
August
25, 2036
|
|||||
|
I-43-A
|
Variable(2)
|
|
$
|
1,798,000.00
|
August
25, 2036
|
|||||
|
I-43-B
|
Variable(2)
|
|
$
|
1,798,000.00
|
August
25, 2036
|
|||||
|
I-44-A
|
Variable(2)
|
|
$
|
1,734,500.00
|
August
25, 2036
|
|||||
|
I-44-B
|
Variable(2)
|
|
$
|
1,734,500.00
|
August
25, 2036
|
|||||
|
I-45-A
|
Variable(2)
|
|
$
|
46,842,000.00
|
August
25, 2036
|
|||||
|
I-45-B
|
Variable(2)
|
|
$
|
46,842,000.00
|
August
25, 2036
|
|||||
_____________________________________
(1) For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations, the
Distribution Date in the month following the maturity date for the Mortgage
Loan
with the latest maturity date has been designated as the “latest possible
maturity date” for each REMIC I Regular Interest.
(2) Calculated
in accordance with the definition of “Uncertificated REMIC I Pass-Through Rate”
herein.
REMIC
II
As
provided herein, the
Securities Administrator on behalf of the Trustee will
elect to treat the segregated pool of assets consisting of the REMIC I Regular
Interests as a REMIC for federal income tax purposes, and such segregated pool
of assets will be designated as “REMIC II”. The Class R-2 Certificates will
represent the sole class of Residual Interests in REMIC II for purposes of
the
REMIC Provisions. The
following table irrevocably sets forth the designation, the Uncertificated
REMIC
II Pass-Through Rate, the initial Uncertificated Principal Balance and, for
purposes of satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for each of the REMIC II Regular Interests (as
defined herein). None of the REMIC II Regular Interests will be
certificated.
|
Designation
|
Uncertificated
REMIC II
Pass-Through
Rate
|
Initial
Uncertificated Principal Balance
|
Latest
Possible Maturity Date (1)
|
|||||||
|
AA
|
Variable(2)
|
|
$
|
453,000,108.46
|
August
25, 2036
|
|||||
|
A
|
Variable(2)
|
|
$
|
3,510,750.00
|
August
25, 2036
|
|||||
|
M-1
|
Variable(2)
|
|
$
|
201,080.00
|
August
25, 2036
|
|||||
|
M-2
|
Variable(2)
|
|
$
|
201,080.00
|
August
25, 2036
|
|||||
|
M-3
|
Variable(2)
|
|
$
|
71,650.00
|
August
25, 2036
|
|||||
|
M-4
|
Variable(2)
|
|
$
|
64,710.00
|
August
25, 2036
|
|||||
|
M-5
|
Variable(2)
|
|
$
|
62,400.00
|
August
25, 2036
|
|||||
|
M-6
|
Variable(2)
|
|
$
|
60,090.00
|
August
25, 2036
|
|||||
|
B-1
|
Variable(2)
|
|
$
|
53,160.00
|
August
25, 2036
|
|||||
|
B-2
|
Variable(2)
|
|
$
|
46,220.00
|
August
25, 2036
|
|||||
|
B-3
|
Variable(2)
|
|
$
|
57,780.00
|
August
25, 2036
|
|||||
|
B-4
|
Variable(2)
|
|
$
|
62,400.00
|
August
25, 2036
|
|||||
|
ZZ
|
Variable(2)
|
|
$
|
4,853,580.17
|
August
25, 2036
|
|||||
|
IO
|
(2)
|
|
(3)
|
|
August
25, 2036
|
|||||
___________________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the month following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as
the
“latest possible maturity date” for each REMIC II Regular
Interest
|
.
|
(2)
|
Calculated
in accordance with the definition of “Uncertificated REMIC II Pass-Through
Rate” herein.
|
|
(3)
|
REMIC
II Regular Interest IO will not have an Uncertificated Principal
Balance
but will accrue interest on its uncertificated notional amount calculated
in accordance with the definition of “Uncertificated Notional Amount”
herein.
|
REMIC
III
As
provided herein, the Securities Administrator on behalf of the Trustee will
elect to treat the segregated pool of assets consisting of the REMIC II Regular
Interests as a REMIC for federal income tax purposes, and such segregated pool
of assets will be designated as “REMIC III”. The Class R-3 Certificates will
represent the sole class of Residual Interests in REMIC III for purposes of
the
REMIC Provisions.
The
following table irrevocably sets forth the designation, Pass-Through Rate,
Initial Certificate Principal Balance (or initial Uncertificated Principal
Balance, in the case of the Class C Interest and the Class IO Interest) and,
for
purposes of satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for each class of Certificates and interests
that represents ownership of one or more of the Regular Interests in REMIC
III
created hereunder.
Each
Certificate, other than the Class C Certificates and Class R Certificates,
represents ownership of a Regular Interest in REMIC III and also represents
(i)
the right to receive certain amounts specified herein in respect of Basis Risk
Shortfall Carry Forward Amounts (as defined herein) and (ii) the obligation
to
pay Class IO Distribution Amounts (as defined herein). The entitlement to
principal of the Regular Interest which corresponds to each Certificate shall
be
equal in amount and timing to the entitlement to principal of such Certificate.
|
Designation
|
Pass-Through
Rate
|
Initial
Certificate
or
Uncertificated
Principal
Balance
|
Latest
Possible
Maturity
Date (1)
|
||||||||||
|
A(2)
|
Variable(3)
|
|
$
|
351,075,000.00
|
August
25, 2036
|
||||||||
|
M-1(2)
|
Variable(3)
|
|
$
|
20,108,000.00
|
August
25, 2036
|
||||||||
|
M-2(2)
|
Variable(3)
|
|
$
|
20,108,000.00
|
August
25, 2036
|
||||||||
|
M-3(2)
|
Variable(3)
|
|
$
|
7,165,000.00
|
August
25, 2036
|
||||||||
|
M-4(2)
|
Variable(3)
|
|
$
|
6,471,000.00
|
August
25, 2036
|
||||||||
|
M-5(2)
|
Variable(3)
|
|
$
|
6,240,000.00
|
August
25, 2036
|
||||||||
|
M-6(2)
|
Variable(3)
|
|
$
|
6,009,000.00
|
August
25, 2036
|
||||||||
|
B-1(2)
|
Variable(3)
|
|
$
|
5,316,000.00
|
August
25, 2036
|
||||||||
|
B-2(2)
|
Variable(3)
|
|
$
|
4,622,000.00
|
August
25, 2036
|
||||||||
|
B-3(2)
|
Variable(3)
|
|
$
|
5,778,000.00
|
August
25, 2036
|
||||||||
|
B-4(2)
|
Variable(3)
|
|
$
|
6,240,000.00
|
August
25, 2036
|
||||||||
|
Class
C Interest
|
Variable(3)(4)
|
|
$
|
23,113,008.63
|
August
25, 2036
|
||||||||
|
Class
IO Interest
|
(5)
|
|
(6)
|
|
August
25, 2036
|
||||||||
______________________________________
(1) For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations, the
Distribution Date in the month following the maturity date for the Mortgage
Loan
with the latest maturity date has been designated as the “latest possible
maturity date” for each REMIC III Regular Interest (as defined
herein).
(2) This
Class of Certificates represents ownership of a Regular Interest in REMIC III.
Any amount distributed on this Class of Certificates on any Distribution Date
in
excess of the amount distributable on the related Regular Interest in REMIC
III
on such Distribution Date shall be treated for federal income tax purposes
as
having been paid from the Reserve Fund or the Supplemental Interest Trust,
as
applicable, and any amount distributable on the related Regular Interest in
REMIC III on such Distribution Date in excess of the amount distributable on
such Class of Certificates on such Distribution Date shall be treated for such
purposes as having been distributed to the Holders of such Certificates and
then
paid by such Holders to the Supplemental Interest Trust, all pursuant to and
as
further provided in Section 4.14 hereof.
(3) Calculated
in accordance with the definition of “Pass-Through Rate” herein. Each Regular
Interest in REMIC III which corresponds to a Class A, Class M or Class B
Certificate will have the same Pass-Through Rate as such Certificate, except
with respect to the Net WAC Cap Rate. The Net WAC Cap Rate for each such Regular
Interest in REMIC III and Certificate is specified in the definition of “Net WAC
Cap Rate.”
(4)
The
Class
C Interest will not accrue interest on its Uncertificated Principal Balance,
but
will accrue interest on its Uncertificated Notional Amount as described
herein.
(5) For
federal income tax purposes, the Class IO Interest will not have a Pass-Through
Rate, but will be entitled to 100% of the amounts distributed on REMIC II
Regular Interest IO.
(6) For
federal income tax purposes, the Class IO Interest will not have an
Uncertificated Principal Balance, but will have a notional amount equal to
the
Uncertificated Notional Amount of REMIC II Regular Interest IO.
REMIC
IV
As
provided herein, the Securities Administrator on behalf of the Trustee will
elect to treat the segregated pool of assets consisting of the Class C Interest
as a REMIC for federal income tax purposes, and such segregated pool of assets
will be designated as “REMIC IV”. The Class R-4 Interest represents the sole
class of Residual Interests in REMIC IV for purposes of the REMIC
Provisions.
The
following table sets forth the Class designation, Pass-Through Rate, Initial
Certificate Principal Balance and, for purposes of satisfying Treasury
Regulation Section 1.860G-1(a)(4)(iii), the “latest possible maturity date” for
the indicated Class of Certificates that represents a Regular Interest in REMIC
IV created hereunder. Each Class C Certificate represents ownership of a Regular
Interest in REMIC IV and also represents (i) the obligation to pay certain
amounts specified herein in respect of Basis Risk Shortfall Carry Forward
Amounts and (ii) the right to receive Class IO Distribution
Amounts.
|
Class
Designation
|
Pass-Through
Rate
|
Initial
Certificate
Principal
Balance
|
Latest
Possible
Maturity
Date(1)
|
|||||||
|
C
|
Variable(2)
|
|
$
|
23,113,008.63
|
August
25, 2036
|
|||||
_______________
(1) For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations, the
Distribution Date in the month following the maturity date for the Mortgage
Loan
with the latest maturity date has been designated as the “latest possible
maturity date” for the Class C Certificates.
(2) The
Class
C Certificates will not accrue interest on its Uncertificated Principal Balance,
but will receive 100% of the amounts received in respect of the Class C
Interest.
REMIC
V
As
provided herein, the Securities Administrator on behalf of the Trustee shall
elect to treat the segregated pool of assets consisting of the Class IO Interest
as a REMIC for federal income tax purposes, and such segregated pool of assets
will be designated as “REMIC V”. The Class R-5 Interest represents the sole
class of Residual Interests in REMIC V for purposes of the REMIC
Provisions.
The
following table sets forth the designation, Pass-Through Rate, initial
Uncertificated Principal Balance and, for purposes of satisfying Treasury
Regulation Section 1.860G-1(a)(4)(iii), the “latest possible maturity date” for
the indicated class of interests that represents a Regular Interest in REMIC
V
created hereunder:
|
Designation
|
Pass-Through
Rate
|
Initial
Uncertificated Principal Balance
|
Latest
Possible
Maturity
Date(1)
|
|||||||
|
IO(2)
|
(3)
|
|
|
(4)
|
|
August
25, 2036
|
||||
_______________
(1) For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations, the
Distribution Date in the month following the maturity date for the Mortgage
Loan
with the latest maturity date has been designated as the “latest possible
maturity date” for REMIC V Regular Interest IO.
(2) REMIC
V
Regular Interest IO will be held as an asset of the Supplemental Interest
Trust.
(3) REMIC
V
Regular Interest IO will not have a Pass-Through Rate, but will receive 100%
of
the amounts received in respect of the Class IO Interest.
(4) REMIC
V
Regular Interest IO will not have an Uncertificated Principal Balance, but
will
have a notional amount equal to the Uncertificated Notional Amount of the Class
IO Interest.
The
Trust
Fund shall be named, and may be referred to as, the “SACO I Trust 2006-9.” The
Certificates issued hereunder may be referred to as “Mortgage-Backed
Certificates, Series 2006-9” (including for purposes of any endorsement or
assignment of a Mortgage Note or Mortgage).
In
consideration of the mutual agreements herein contained, the Depositor, the
Master Servicer, the Securities Administrator, the Seller, the Company and
the
Trustee agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.01 Defined
Terms.
Whenever
used in this Agreement, the following words and phrases, unless otherwise
expressly provided or unless the context otherwise requires, shall have the
meanings specified in this Article.
10-K
Filing Deadline:
The
meaning set forth in Section 3.18(a)(iv).
Accepted
Master Servicing Practices:
With
respect to any Mortgage Loan those customary mortgage master servicing practices
of prudent mortgage master servicing institutions that master service mortgage
loans, of the same type and quality as such Mortgage Loan in the jurisdiction
where the related Mortgaged Property is located, to the extent applicable to
the
Master Servicer (except in its capacity as successor to the Company or a
Servicer).
Accepted
Servicing Practices:
With
respect to each Mortgage Loan, those customary mortgage servicing practices
(including collection procedures) that are in accordance with all applicable
statutes, regulations and prudent mortgage banking practices for mortgage loans
of the same type and quality as such Mortgage Loan in the jurisdiction where
the
related Mortgaged Property is located.
Account:
The
Distribution Account, the Master Servicer Collection Account, the Reserve Fund,
the Swap Account and any Protected Account.
Accrual
Period:
With
respect to the Certificates (other than the Class C Certificates and the
Residual Certificates) and any Distribution Date, the period from and including
the immediately preceding Distribution Date (or with respect to the first
Accrual Period, the Closing Date) to and including the day prior to such
Distribution Date. With respect to the Class C Certificates and the Class C
Interest and any Distribution Date, the calendar month immediately preceding
such Distribution Date. All calculations of interest on the Certificates (other
than the Class C Certificates and the Residual Certificates) will be made on
the
basis of the actual number of days elapsed in the related Accrual Period. All
calculations of interest on the Class C Certificates and the Class C Interest
will be made on the basis of a 360-day year consisting of twelve 30-day
months.
Additional
Disclosure:
As
defined in Section 3.18(a)(v).
Additional
Disclosure Notification:
The
form of notice set forth in Exhibit Q.
Additional
Form 10-D Disclosure:
As
defined in Section 3.18(a)(i).
Additional
Form 10-K Disclosure:
As
defined in Section 3.18(a)(iv).
Adjustable
Rate Mortgage Loan:
Each of
the Mortgage Loans identified in the Mortgage Loan Schedule as having a Mortgage
Rate that is subject to adjustment.
Adjustment
Date:
With
respect to each Adjustable Rate Mortgage Loan, the first day of the month in
which the Mortgage Rate of an Adjustable Rate Mortgage Loan changes pursuant
to
the related Mortgage Note. The first Adjustment Date following the Cut-off
Date
as to each Adjustable Rate Mortgage Loan is set forth in the Mortgage Loan
Schedule.
Advance:
An
advance of delinquent payments of principal and interest in respect of a
Mortgage Loan required to be made by the Company as provided in Section 6.01(a)
hereof or by the related Servicer and Master Servicer as provided in Section
6.01(b) hereof.
Affected
Party:
An
“Affected Party” as defined in the Swap Agreement.
Agreement:
This
Pooling and Servicing Agreement and any and all amendments or supplements hereto
made in accordance with the terms herein.
Amount
Held for Future Distribution:
As to
any Distribution Date and the EMC Mortgage Loans, the aggregate amount held
in
the Company’s Protected Account at the close of business on the immediately
preceding Determination Date on account of (i) all Scheduled Payments or
portions thereof received in respect of the EMC Mortgage Loans due after the
related Due Period and (ii) Principal Prepayments, Liquidation Proceeds,
Subsequent Recoveries and Insurance Proceeds received in respect of such
Mortgage Loans after the last day of the related Prepayment Period. As to any
Distribution Date and the Mortgage Loans serviced by any Servicer other than
EMC, the aggregate amount held in the related Servicer’s Protected Account at
the close of business on the immediately preceding Business Day on account
of
(i) all principal payments or portions thereof received in respect of such
Mortgage Loans serviced by it due after the related Due Period and (ii)
Principal Prepayments, Liquidation Proceeds, Subsequent Recoveries and Insurance
Proceeds received in respect of such Mortgage Loans after the last day of the
related Prepayment Period.
Annual
Statement of Compliance:
As
defined in Section 3.16.
Applied
Realized Loss Amount:
With
respect to any Distribution Date and any Class of Class A, Class M and Class
B
Certificates, the sum of the Realized Losses with respect to the Mortgage Loans
that have been applied in reduction of the Certificate Principal Balance of
a
Class of Certificates pursuant to Section 6.05 of this Agreement which have
not
previously been reimbursed or reduced by any Subsequent Recoveries applied
to
such Applied Realized Loss Amount.
Appraised
Value:
With
respect to any Mortgage Loan originated in connection with a refinancing, the
appraised value of the Mortgaged Property based upon the appraisal made at
the
time of such refinancing or, with respect to any other Mortgage Loan, the lesser
of (x) the appraised value of the Mortgaged Property based upon the appraisal
made by a fee appraiser at the time of the origination of the related Mortgage
Loan, and (y) the sales price of the Mortgaged Property at the time of such
origination.
Assignment
Agreement:
The
First Horizon Assignment Agreement, the GMACM Assignment Agreement or the
HomeBanc Assignment Agreement, as applicable.
Assessment
of Compliance:
As
defined in Section 3.17.
Attestation
Report:
As
defined in Section 3.17.
Attesting
Party:
As
defined in Section 3.17.
Back-Up
Certification:
As
defined in Section 3.18.
Basis
Risk Shortfall Carry Forward Amount:
With
respect to any Distribution Date and any Class of Class A, Class M and Class
B
Certificates, an amount equal to the sum of (A) the excess, if any, of (a)
the
amount of Current Interest that such Class would have been entitled to receive
on such Distribution Date had the Pass-Though Rate applicable to such Class
been
calculated at a per annum rate equal to lesser of (i) the related One-Month
LIBOR Pass-Through Rate and (ii) 11.00% per annum, over (b) the amount of
Current Interest that such Class received on such Distribution Date if the
Pass-Through Rate is limited to the Net Rate Cap and (B) the Basis Risk
Shortfall Carry Forward Amount for the previous Distribution Date not previously
paid, together with interest thereon at a rate equal to the related Pass-Through
Rate the current Distribution Date.
Bankruptcy
Code:
Title
11 of the United States Code.
Book-Entry
Certificates:
Any of
the Certificates that shall be registered in the name of the Depository or
its
nominee, the ownership of which is reflected on the books of the Depository
or
on the books of a person maintaining an account with the Depository (directly,
as a “Depository Participant”, or indirectly, as an indirect participant in
accordance with the rules of the Depository and as described in Section 7.06).
As of the Closing Date, each Class of Regular Certificates (other than the
Class
C Certificates) constitutes a Class of Book-Entry Certificates.
Business
Day:
Any day
other than (i) a Saturday or a Sunday, or (ii) a day on which banking
institutions in the City of New York, New York, Chicago, Illinois, Minneapolis,
Minnesota or any city in which the Corporate Trust Office of the Trustee or
the
Securities Administrator or the principal office of the Company or the Master
Servicer is located are authorized or obligated by law or executive order to
be
closed.
Certificate:
Any one
of the certificates of any Class executed and authenticated by the Securities
Administrator in substantially the forms attached hereto as Exhibits A-1 through
A-5.
Certificate
Margin:
With
respect to the Class A Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest A, 0.150% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.300% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-1 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-1, 0.350% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.525% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-2 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-2, 0.380% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.570% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-3 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-3, 0.410% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.615% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-4 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-4, 0.520% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.780% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-5 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-5, 0.600% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.900% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-6 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-6, 0.700% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 1.050% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class B-1 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest B-1, 1.100% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 1.650% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class B-2 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest B-2, 1.250% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 1.875% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class B-3 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest B-3, 2.750% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 4.125% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class B-4 Certificates and, for purposes of the definition of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest B-4 Certificates,
2.500% per annum in the case of each Distribution Date through and including
the
first possible Optional Termination Date and 3.750% per annum in the case of
each Distribution Date thereafter.
Certificate
Notional Amount:
With
respect to the Class C Certificates and any Distribution Date, an amount equal
to the Stated Principal Balance of the Mortgage Loans as of the beginning of
the
related Due Period. The initial Certificate Notional Amount of the Class C
Certificates shall be $462,245,008.63. For federal income tax purposes, the
Certificate Notional Amount for any Distribution Date shall be an amount equal
to the Uncertificated Notional Amount for the Class C Interest for such
Distribution Date
Certificate
Owner:
With
respect to a Book-Entry Certificate, the Person that is the beneficial owner
of
such Book-Entry Certificate.
Certificate
Principal Balance:
As to
any Certificate (other than any Class C Certificate and any Class R Certificate)
and as of any Distribution Date, the Initial Certificate Principal Balance
of
such Certificate plus, in the case of a Class A, Class M or Class B Certificate,
any Subsequent Recoveries added to the Certificate Principal Balance of such
Certificate pursuant to Section 6.04(b), less the sum of (i) all amounts
distributed with respect to such Certificate in reduction of the Certificate
Principal Balance thereof on previous Distribution Dates pursuant to Section
6.04, and (ii) any Applied Realized Loss Amounts allocated to such Certificate
on previous Distribution Dates. As to the Class C Certificates and as of any
Distribution Date, an amount equal to the Uncertificated Principal Balance
of
the Class C Interest.
Certificate
Register:
The
register maintained pursuant to Section 7.02 hereof.
Certificateholder
or Holder:
The
person in whose name a Certificate is registered in the Certificate Register
(initially, Cede & Co., as nominee for the Depository, in the case of any
Book-Entry Certificates).
Certification
Parties:
The
meaning set forth in Section 3.18(a)(iv).
Certifying
Person:
The
meaning set forth in Section 3.18(a)(iv).
Class:
All
Certificates bearing the same Class designation as set forth in Section 7.01
hereof.
Class
A Principal Distribution Amount:
For
any
Distribution Date, an amount equal to the lesser of (x) the Principal
Distribution Amount for such Distribution Date and (y) the excess, if any,
of
(i) the aggregate Certificate Principal Balance of the Class A Certificates
immediately prior to such Distribution Date, over (ii) the lesser of (a) the
product of (1) 51.90% and (2) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period, and after reduction for Realized Losses
incurred during the related Due Period), and (b) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced, and unscheduled collections
of
principal received during the related Prepayment Period, and after reduction
for
Realized Losses incurred during the related Due Period) minus the
Overcollateralization Floor.
Class
A Certificate:
Any
Certificate designated as a “Class A Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to the Percentage Interest
of
distributions provided for the Class A Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
B Certificates:
Any of
the Class B-1, Class B-2, Class B-3 or Class B-4 Certificates.
Class
B-1 Certificate:
Any
Certificate designated as a “Class B-1 Certificate” on the face thereof, in the
form of Exhibit A-3 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class B-1 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
B-1 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5 Principal
Distribution Amount and the Class M-6 Principal Distribution Amount and (y)
the
excess, if any, of (a) the sum of (1) the aggregate Certificate Principal
Balance of the Class A Certificates (after taking into account the distribution
of the Class A Principal Distribution Amount on such Distribution Date), (2)
the
Certificate Principal Balance of the Class M-1 Certificates (after taking into
account the distribution of the Class M-1 Principal Distribution Amount on
such
Distribution Date), (3) the Certificate Principal Balance of the Class M-2
Certificates (after taking into account the distribution of the Class M-2
Principal Distribution Amount on such Distribution Date), (4) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account
the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date), (6) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date), (7) the Certificate Principal Balance of the Class M-6 Certificates
(after taking into account the distribution of the Class M-6 Principal
Distribution Amount on such Distribution Date) and (8) the Certificate Principal
Balance of the Class B-1 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 82.80% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Due Period),
and
(2) the aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the related
Due
Period) minus the Overcollateralization Floor.
Class
B-2 Certificate:
Any
Certificate designated as a “Class B-2 Certificate” on the face thereof, in the
form of Exhibit A-3 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class B-2 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
B-2 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5 Principal
Distribution Amount, the Class M-6 Principal Distribution Amount and the Class
B-1 Principal Distribution Amount and (y) the excess, if any, of (a) the sum
of
(1) the aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Class A Principal
Distribution Amount on such Distribution Date), (2) the Certificate Principal
Balance of the Class M-1 Certificates (after taking into account the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (4) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date), (6) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date), (7) the Certificate Principal Balance of the Class M-6 Certificates
(after taking into account the distribution of the Class M-6 Principal
Distribution Amount on such Distribution Date), (8) the Certificate Principal
Balance of the Class B-1 Certificates (after taking into account the
distribution of the Class B-1 Principal Distribution Amount on such Distribution
Date) and (9) the Certificate Principal Balance of the Class B-2 Certificates
immediately prior to such Distribution Date, over (b) the lesser of (1) the
product of (x) 84.80% and (y) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period, and after reduction for Realized Losses
incurred during the related Due Period), and (2) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced, and unscheduled collections
of
principal received during the related Prepayment Period, and after reduction
for
Realized Losses incurred during the related Due Period) minus the
Overcollateralization Floor.
Class
B-3 Certificate:
Any
Certificate designated as a “Class B-3 Certificate” on the face thereof, in the
form of Exhibit A-3 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class B-3 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
B-3 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5 Principal
Distribution Amount, the Class M-6 Principal Distribution Amount, the Class
B-1
Principal Distribution Amount, and the Class B-2 Principal Distribution Amount
and (y) the excess, if any, of (a) the sum of (1) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (2) the Certificate Principal Balance of the Class M-1 Certificates
(after taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (3) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (4) the Certificate Principal Balance of the Class M-3 Certificates
(after taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (5) the Certificate Principal
Balance of the Class M-4 Certificates (after taking into account the
distribution of the Class M-4 Principal Distribution Amount on such Distribution
Date), (6) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the distribution of the Class M-5 Principal
Distribution Amount on such Distribution Date), (7) the Certificate Principal
Balance of the Class M-6 Certificates (after taking into account the
distribution of the Class M-6 Principal Distribution Amount on such Distribution
Date), (8) the Certificate Principal Balance of the Class B-1 Certificates
(after taking into account the distribution of the Class B-1 Principal
Distribution Amount on such Distribution Date), (9) the Certificate Principal
Balance of the Class B-2 Certificates (after taking into account the
distribution of the Class B-2 Principal Distribution Amount on such Distribution
Date) and (10) the Certificate Principal Balance of the Class B-3 Certificates
immediately prior to such Distribution Date, over (b) the lesser of (1) the
product of (x) 87.30% and (y) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period, and after reduction for Realized Losses
incurred during the related Due Period), and (2) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced, and unscheduled collections
of
principal received during the related Prepayment Period, and after reduction
for
Realized Losses incurred during the related Due Period) minus the
Overcollateralization Floor.
Class
B-4 Certificate:
Any
Certificate designated as a “Class B-4 Certificate” on the face thereof, in the
form of Exhibit A-3 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class B-4 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
B-4 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5 Principal
Distribution Amount, the Class M-6 Principal Distribution Amount, the Class
B-1
Principal Distribution Amount, the Class B-2 Principal Distribution Amount
and
the Class B-3 Principal Distribution Amount and (y) the excess, if any, of
(a)
the sum of (1) the aggregate Certificate Principal Balance of the Class A
Certificates (after taking into account the distribution of the Class A
Principal Distribution Amount on such Distribution Date), (2) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account
the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (4) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date), (6) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date), (7) the Certificate Principal Balance of the Class M-6 Certificates
(after taking into account the distribution of the Class M-6 Principal
Distribution Amount on such Distribution Date), (8) the Certificate Principal
Balance of the Class B-1 Certificates (after taking into account the
distribution of the Class B-1 Principal Distribution Amount on such Distribution
Date), (9) the Certificate Principal Balance of the Class B-2 Certificates
(after taking into account the distribution of the Class B-2 Principal
Distribution Amount on such Distribution Date), (10) the Certificate Principal
Balance of the Class B-3 Certificates (after taking into account the
distribution of the Class B-3 Principal Distribution Amount on such Distribution
Date) and (11) the Certificate Principal Balance of the Class B-4 Certificates
immediately prior to such Distribution Date, over (b) the lesser of (1) the
product of (x) 90.00% and (y) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period, and after reduction for Realized Losses
incurred during the related Due Period), and (2) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced, and unscheduled collections
of
principal received during the related Prepayment Period, and after reduction
for
Realized Losses incurred during the related Due Period) minus the
Overcollateralization Floor.
Class
C Certificate:
Any
Certificate designated as a “Class C Certificate” on the face thereof, in the
form of Exhibit A-4 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class C Certificates herein and evidencing (i)
a
Regular Interest in REMIC IV, (ii) the obligation to pay Basis Risk Shortfall
Carry Forward Amounts, (iii)
the
right to receive Class IO Distribution Amounts and (iv) the right to receive
any
Prepayment Charge Waiver Amounts.
Class
C Distribution Amount:
With
respect to any Distribution Date, the sum of (i) the Current Interest for the
Class C Interest for such Distribution Date, (ii) any Overcollateralization
Release Amount for such Distribution Date and (iii) without duplication, any
Subsequent Recoveries not distributed to the Class A, Class M and Class B
Certificates on such Distribution Date; provided, however, that, on any
Distribution Date after the Distribution Date on which the Certificate Principal
Balances of the Class A, Class M and Class B Certificates have been reduced
to
zero, the Class C Distribution Amount shall include the Overcollateralization
Amount.
Class
C Interest:
An
uncertificated interest in the Trust Fund held by the Trustee on behalf of
the
Holders of the Class C Certificates, evidencing a Regular Interest in REMIC
III
for purposes of the REMIC Provisions.
Class
IO Distribution Amount:
As
defined in Section 4.14 hereof. For purposes of clarity, the Class IO
Distribution Amount for any Distribution Date shall equal the amount payable
to
the Swap Administrator on such Distribution Date pursuant to the first and
second sentences of Section 4.14(c) in excess of the amount payable on REMIC
V
Regular Interest IO on such Distribution Date, all as further provided in
Section 4.14 hereof.
Class
IO Interest:
An
uncertificated interest in the Trust Fund held by the Trustee on behalf of
the
holders of REMIC V Regular Interest IO, evidencing a Regular Interest in REMIC
V
for purposes of the REMIC provisions.
Class
M Certificates:
Any of
the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5 and Class M-6
Certificates.
Class
M-1 Certificate:
Any
Certificate designated as a “Class M-1 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-1 Certificates as set forth herein and
evidencing
(i) a Regular Interest in REMIC III, (ii) the right to receive Basis Risk
Shortfall Carry Forward Amounts and (iii) the obligation to pay Class IO
Distribution Amounts.
Class
M-1 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount and (y) the excess, if any, of (a) the sum of
(1)
the aggregate Certificate Principal Balance of the Class A Certificates (after
taking into account the distribution of the Class A Principal Distribution
Amount on such Distribution Date) and (2) the Certificate Principal Balance
of
the Class M-1 Certificates immediately prior to such Distribution Date, over
(b)
the lesser of (1) the product of (x) 60.60% and (y) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Due Period),
and
(2) the aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the related
Due
Period) minus the Overcollateralization Floor.
Class
M-2 Certificate:
Any
Certificate designated as a “Class M-2 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-2 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-2 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount and the Class M-1 Principal Distribution Amount
and (y) the excess, if any, of (a) the sum of (1) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (2) the Certificate Principal Balance of the Class M-1 Certificates
(after taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date) and (3) the Certificate Principal
Balance of the Class M-2 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 69.30% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Due Period),
and
(2) the aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the related
Due
Period) minus the Overcollateralization Floor.
Class
M-3 Certificate:
Any
Certificate designated as a “Class M-3 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-3 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-3 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount
and
the Class M-2 Principal Distribution Amount and (y) the excess, if any, of
(a)
the sum of (1) the aggregate Certificate Principal Balance of the Class A
Certificates (after taking into account the distribution of the Class A
Principal Distribution Amount on such Distribution Date), (2) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account
the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date) and (4) the Certificate Principal
Balance of the Class M-3 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 72.40% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Due Period),
and
(2) the aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the related
Due
Period) minus the Overcollateralization Floor.
Class
M-4 Certificate:
Any
Certificate designated as a “Class M-4 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-4 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-4 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount and the Class M-3 Principal Distribution
Amount and (y) the excess, if any, of (a) the sum of (1) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the distribution of the Class A Principal Distribution Amount on such
Distribution Date), (2) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (3) the Certificate
Principal Balance of the Class M-2 Certificates (after taking into account
the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (4) the Certificate Principal Balance of the Class M-3 Certificates
(after taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date) and (5) the Certificate Principal
Balance of the Class M-4 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 75.20% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Due Period),
and
(2) the aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the related
Due
Period) minus the Overcollateralization Floor.
Class
M-5 Certificate:
Any
Certificate designated as a “Class M-5 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-5 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-5 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount and the Class M-4 Principal Distribution Amount and (y) the excess,
if
any, of (a) the sum of (1) the aggregate Certificate Principal Balance of the
Class A Certificates (after taking into account the distribution of the Class
A
Principal Distribution Amount on such Distribution Date), (2) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account
the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (4) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date) and (6) the Certificate Principal
Balance of the Class M-5 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 77.90% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Due Period),
and
(2) the aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the related
Due
Period) minus the Overcollateralization Floor.
Class
M-6 Certificate:
Any
Certificate designated as a “Class M-6 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-6 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-6 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the Class
A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount and the Class M-5 Principal
Distribution Amount and (y) the excess, if any, of (a) the sum of (1) the
aggregate Certificate Principal Balance of the Class A Certificates (after
taking into account the distribution of the Class A Principal Distribution
Amount on such Distribution Date), (2) the Certificate Principal Balance of
the
Class M-1 Certificates (after taking into account the distribution of the Class
M-1 Principal Distribution Amount on such Distribution Date), (3) the
Certificate Principal Balance of the Class M-2 Certificates (after taking into
account the distribution of the Class M-2 Principal Distribution Amount on
such
Distribution Date), (4) the Certificate Principal Balance of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount on such Distribution Date), (5) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into account
the
distribution of the Class M-4 Principal Distribution Amount on such Distribution
Date), (6) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the distribution of the Class M-5 Principal
Distribution Amount on such Distribution Date) and (7) the Certificate Principal
Balance of the Class M-6 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 80.50% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Due Period),
and
(2) the aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the related
Due
Period) minus the Overcollateralization Floor.
Class
R Certificate:
Any of
the Class R-1, Class R-2, Class R-3 or Class RX Certificates.
Class
R-1 Certificate:
Any
Certificate designated a “Class R-1 Certificate” on the face thereof, in the
form set forth in Exhibit A-5 hereto, evidencing the Residual Interest in REMIC
I and representing the right to the Percentage Interest of distributions
provided for the Class R-1 Certificates as set forth herein.
Class
R-2 Certificate:
Any
Certificate designated a “Class R-2 Certificate” on the face thereof, in the
form set forth in Exhibit A-5 hereto, evidencing the Residual Interest in REMIC
II and representing the right to the Percentage Interest of distributions
provided for the Class R-2 Certificates as set forth herein.
Class
R-3 Certificate:
Any
Certificate designated a “Class R-3 Certificate” on the face thereof, in the
form set forth in Exhibit A-5 hereto, evidencing the Residual Interest in REMIC
III and representing the right to the Percentage Interest of distributions
provided for the Class R-3 Certificates as set forth herein.
Class
RX Certificate:
Any
Certificate designated a “Class RX Certificate” on the face thereof, in the form
set forth in Exhibit A-5 hereto, evidencing the ownership of the Class R-4
Interest and Class R-5 Interest and representing the right to the Percentage
Interest of distributions provided for the Class RX Certificates as set forth
herein.
Class
R-4 Interest:
The
uncertificated Residual Interest in REMIC IV.
Class
R-5 Interest:
The
uncertificated Residual Interest in REMIC V.
Closing
Date:
August
30, 2006.
Code:
The
Internal Revenue Code of 1986, including any successor or amendatory
provisions.
Combined
Loan-to-Value Ratio:
With
respect to any Mortgage Loan and as of any date of determination, the fraction
(expressed as a percentage) the numerator of which is the sum of (i) original
principal balance of the related Mortgage Loan at such date of determination
and
(ii) the unpaid principal balance of the related first lien Mortgage Loan as
of
the date of origination of that Mortgage Loan and the denominator of which
is
the applicable Appraised Value of the related Mortgaged Property at
origination.
Commission:
The
U.S. Securities and Exchange Commission.
Company:
EMC.
Company
Default:
As
defined in Section 9.05 hereof.
Compensating
Interest:
With
respect to any Distribution Date, (i) in the case of any Servicer, an amount,
not to exceed the Servicing Fee, to be deposited in the Protected Account by
such Servicer with respect to the payment of a Prepayment Interest Shortfall
(related to a voluntary prepayment as described in Section 6.02(a) hereof)
on a
Mortgage Loan subject to this Agreement and (ii) in the case of the Master
Servicer, an amount not to exceed that portion of the Master Servicing Fee
payable to the Master Servicer. If the related Servicer fails to make such
payment, the Master Servicer shall be obligated to do so to the extent provided
in Section 6.02(b) hereof.
Corporate
Trust Office:
(i)
With respect to the Trustee, the designated corporate trust office of the
Trustee, currently located at Citibank, N.A., 000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, and (ii) with respect to the Securities Administrator,
the designated office of the Securities Administrator currently located at
000
Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000 Attention: Global
Securities and Trust Services Group — SACO 2006-9 or at such other address as
the Trustee or Securities Administrator, as applicable, may designate from
time
to time by notice to the Certificateholders, the Depositor, the Trustee, the
Master Servicer, the Securities Administrator and EMC or at the principal
corporate trust office of any successor Trustee.
Corresponding
Certificate:
With
respect to each REMIC II Regular Interest (other than REMIC II Regular Interests
AA, ZZ and IO), the Certificate with the corresponding designation. With respect
to each REMIC III Regular Interest (other than the Class C Interest and the
Class IO Interest), the related Certificate representing an ownership
therein.
Cumulative
Realized Loss Percentage:
With
respect to the Certificates and any Distribution Date, the percentage obtained
by dividing (x) the aggregate Realized Losses on the Mortgage Loans incurred
since the related Cut-off Date through the end of the related Due Period by
(y)
the aggregate Stated Principal Balance of the Mortgage Loans as of the related
Cut-off Date.
Current
Interest:
As of
any Distribution Date, with respect to the Certificates and interests of each
class (other than the Residual Interests and the Residual Certificates), (i)
the
interest accrued on the Certificate Principal Balance, or Certificate Notional
Amount or Uncertificated Notional Amount, as applicable, during the related
Accrual Period at the applicable Pass-Through Rate, plus any amount previously
distributed with respect to interest for such Certificate or interest that
has
been recovered as a voidable preference by a trustee in bankruptcy minus (ii)
the sum of (a) any Prepayment Interest Shortfall for such Distribution Date,
to
the extent not covered by Compensating Interest and (b) any Relief Act Interest
Shortfalls during the related Due Period, provided, however, that for purposes
of calculating Current Interest for any such class, amounts specified in clause
(ii) hereof for any such Distribution Date shall be allocated first to the
Class
C Certificates and the Class C Interest and the Residual Certificates in
reduction of amounts otherwise distributable to such Certificates and interest
on such Distribution Date and then any excess shall be allocated to each Class
of Class A, Class M and Class B Certificates pro
rata
based on
the respective amounts of interest accrued pursuant to clause (i) hereof for
each such Class on such Distribution Date.
Current
Specified Enhancement Percentage: With
respect to any Distribution Date, the percentage obtained by dividing (x) the
sum of (i) the aggregate Certificate Principal Balance of the Class M
Certificates and Class B Certificates and (ii) the Overcollateralization Amount,
in each case prior to the distribution of the Principal Distribution Amount
on
such Distribution Date, by (y) the aggregate Stated Principal Balance of the
Mortgage Loans as of the end of the related Due Period (after giving effect
to
scheduled payments of principal due during the related Due Period, to the extent
received or advanced, and unscheduled collections of principal received during
the related Prepayment Period, and after reduction for Realized Losses incurred
during the related Due Period).
Custodial
Agreements:
The
LaSalle Custodial Agreement or Xxxxx Fargo Custodial Agreement, as applicable.
Custodians:
(i)
Xxxxx Fargo, or any successor custodian appointed pursuant to the provisions
hereof and the Xxxxx Fargo Custodial Agreement and (ii) LaSalle, or any
successor custodian appointed pursuant to the provisions hereof and the LaSalle
Custodial Agreement.
Cut-off
Date:
The
close of business on August 1, 2006.
Cut-off
Date Principal Balance:
As to
any Mortgage Loan, the unpaid principal balance thereof as of the close of
business on the Cut-off Date after application of all Principal Prepayments
received prior to the Cut-off Date and scheduled payments of principal due
on or
before the Cut-off Date, whether or not received, but without giving effect
to
any installments of principal received in respect of Due Dates after the Cut-off
Date. The aggregate Cut-off Date Principal Balance of the Mortgage Loans is
$462,245,008.63.
Debt
Service Reduction:
With
respect to any Mortgage Loan, a reduction by a court of competent jurisdiction
in a proceeding under the Bankruptcy Code in the Scheduled Payment for such
Mortgage Loan that became final and non-appealable, except such a reduction
resulting from a Deficient Valuation or any other reduction that results in
a
permanent forgiveness of principal.
Defaulting
Party:
A
“Defaulting Party” as defined in the Swap Agreement.
Deficient
Valuation:
With
respect to any Mortgage Loan, a valuation by a court of competent jurisdiction
of the Mortgaged Property in an amount less than the then outstanding
indebtedness under such Mortgage Loan, or any reduction in the amount of
principal to be paid in connection with any Scheduled Payment that results
in a
permanent forgiveness of principal, which valuation or reduction results from
an
order of such court that is final and non-appealable in a proceeding under
the
Bankruptcy Code.
Definitive
Certificates:
As
defined in Section 7.06.
Deleted
Mortgage Loan:
A
Mortgage Loan replaced or to be replaced by a Replacement Mortgage
Loan.
Delinquent:
A
Mortgage Loan is “delinquent” if any payment due thereon is not made pursuant to
the terms of such Mortgage Loan by the close of business on the day such payment
is scheduled to be due. A Mortgage Loan is “30 days delinquent” if such payment
has not been received by the close of business on the corresponding day of
the
month immediately succeeding the month in which such payment was due, or, if
there is no such corresponding day (e.g., as when a 30-day month follows a
31-day month in which a payment was due on the 31st day of such month), then
on
the last day of such immediately succeeding month. Similarly for “60 days
delinquent,” “90 days delinquent” and so on.
Denomination:
With
respect to each Certificate, the amount set forth on the face thereof as the
“Initial Principal Balance or Initial Notional Amount of this
Certificate”.
Depositor:
Bear
Xxxxxxx Asset Backed Securities I LLC, a Delaware limited liability company,
or
its successor in interest.
Depository:
The
initial Depository shall be The Depository Trust Company (“DTC”), the nominee of
which is Cede & Co., or any other organization registered as a “clearing
agency” pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended. The Depository shall initially be the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a “clearing
corporation” as defined in Section 8-102(a)(5) of the Uniform Commercial Code of
the State of New York.
Depository
Agreement:
With
respect to the Class of Book-Entry Certificates, the agreement between the
Depositor signing on behalf of the Issuing Entity and the initial Depository,
dated as of the Closing Date, substantially in the form of Exhibit
H.
Depository
Participant:
A
broker, dealer, bank or other financial institution or other Person for whom
from time to time a Depository effects book-entry transfers and pledges of
securities deposited with the Depository.
Designated
Depository Institution:
A
depository institution (commercial bank, federal savings bank, mutual savings
bank or savings and loan association) or trust company (which may include the
Trustee, the Securities Administrator and the Master Servicer), the deposits
of
which are fully insured by the FDIC to the extent provided by law.
Determination
Date:
With
respect to any Distribution Date, the 15th
day of
the month of such Distribution Date or, if such 15th
day is
not a Business Day, the immediately preceding Business Day.
Distribution
Account:
The
segregated trust account or accounts created and maintained by the Securities
Administrator pursuant to Section 5.08 in the name of the Trustee for the
benefit of the Certificateholders, which shall be entitled “LaSalle Bank
National Association, as Securities Administrator, on behalf of Citibank, N.A.,
as Trustee, in trust for the registered holders of SACO I Trust 2006-9,
Mortgage-Backed Certificates, Series 2006-9.” The Distribution Account must be
an Eligible Account.
Distribution
Account Deposit Date:
Two
Business Days prior to each Distribution Date.
Distribution
Date:
The
25th day of each calendar month after the initial issuance of the Certificates,
or if such 25th day is not a Business Day, the next succeeding Business Day,
commencing in September 2006.
Due
Date:
As to
any Mortgage Loan, the date in each month on which the related Scheduled Payment
is due, as set forth in the related Mortgage Note.
Due
Period:
With
respect to any Distribution Date, the period from and including the second
day
of the calendar month preceding the calendar month in which such Distribution
Date occurs through close of business on the first day of the calendar month
in
which such Distribution Date occurs.
Eligible
Account:
Any of
(i) an account or accounts maintained with a federal or state chartered
depository institution or trust company, the long-term unsecured debt
obligations and short-term unsecured debt obligations of which (or, in the
case
of a depository institution or trust company that is the principal subsidiary
of
a holding company, the debt obligations of such holding company, so long as
Xxxxx’x is not a Rating Agency) are rated by each Rating Agency in one of its
two highest long-term and its highest short-term rating categories,
respectively, at the time any amounts are held on deposit therein, or (ii)
an
account or accounts in a depository institution or trust company in which such
accounts are insured by the FDIC (to the limits established by the FDIC) and
the
uninsured deposits in which accounts are otherwise secured such that, as
evidenced by an Opinion of Counsel delivered to and satisfactory to the Trustee,
the Securities Administrator and to each Rating Agency, the Certificateholders
have a claim with respect to the funds in such account or a perfected first
priority security interest against any collateral (which shall be limited to
Permitted Investments) securing such funds that is superior to claims of any
other depositors or creditors of the depository institution or trust company
in
which such account is maintained, or (iii) a trust account or accounts
maintained with the corporate trust department of a federal or state chartered
depository institution or trust company having capital and surplus of not less
than $50,000,000, acting in its fiduciary capacity or (iv) any other account
acceptable to each Rating Agency, as evidenced in writing. Eligible Accounts
may
bear interest, and may include, if otherwise qualified under this definition,
accounts maintained with the Trustee and the Securities
Administrator.
EMC:
EMC
Mortgage Corporation, a Delaware corporation, and its successors and
assigns.
EMC
Flow Loans:
The
Mortgage Loans purchased by EMC pursuant to a flow loan purchase
agreement.
EMC
Mortgage Loans:
Those
Mortgage Loans serviced by the Company pursuant to the terms of this
Agreement.
ERISA:
The
Employee Retirement Income Security Act of 1974, as amended.
ERISA
Restricted Certificates:
Any of
the Class C Certificates and Residual Certificates.
Event
of Default:
As
defined in Section 9.01 hereof.
Excess
Cashflow:
With
respect to any Distribution Date, an amount, if any, equal to the sum of (a)
the
Remaining Excess Spread for such Distribution Date and (b) the
Overcollateralization Release Amount for such Distribution Date.
Excess
Liquidation Proceeds:
To the
extent not required by law to be paid to the related Mortgagor, the excess,
if
any, of any Liquidation Proceeds with respect to a Mortgage Loan over the Stated
Principal Balance of such Mortgage Loan and accrued and unpaid interest at
the
related Mortgage Rate through the last day of the month in which the Mortgage
Loan has been liquidated.
Exemption:
Prohibited Transaction Exemption 90-30, as amended from time to
time.
Excess
Spread:
With
respect to any Distribution Date, the excess, if any, of (i) the Interest Funds
for such Distribution Date over (ii) the sum of the Current Interest on the
Class A, Class M and Class B Certificates and Interest Carry Forward Amounts
on
the Class A Certificates (other than Interest Carry Forward Amounts paid
pursuant to Section 6.04(a)(3)(A)), in each case for such Distribution
Date.
Exchange
Act:
The
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder.
Extra
Principal Distribution Amount:
With
respect to any Distribution Date, the lesser of (i) the excess, if any, of
the
Overcollateralization Target Amount for such Distribution Date over the
Overcollateralization Amount for such Distribution Date (after giving effect
to
distributions of principal on the Certificates other than any Extra Principal
Distribution Amount) and (ii) the Excess Spread for such Distribution
Date.
Xxxxxx
Mae:
Xxxxxx
Xxx (formerly, Federal National Mortgage Association), or any successor
thereto.
FDIC:
The
Federal Deposit Insurance Corporation, or any successor thereto.
Final
Certification:
The
certification by a Custodian substantially in the form of Exhibit Three to
the
related Custodial Agreement.
Final
Recovery Determination:
With
respect to any defaulted Mortgage Loan or any REO Property (other than a
Mortgage Loan or REO Property purchased by EMC pursuant to or as contemplated
by
Section 2.04(d) or Section 11.01), a determination made by the Company pursuant
to this Agreement or the related Servicer pursuant to the related Servicing
Agreement that all Insurance Proceeds, Liquidation Proceeds and other payments
or recoveries which the Company or such Servicer, in its reasonable good faith
judgment, expects to be finally recoverable in respect thereof have been so
recovered. The Master Servicer shall maintain records, based solely on
information provided by the Company and the related Servicer, of each Final
Recovery Determination made thereby.
First
Tennessee:
First
Tennessee Mortgage Services, Inc. and any successor thereto.
First
Horizon:
First
Horizon Home Loan Corporation and any successor thereto.
First
Horizon Assignment Agreement:
The
Assignment, Assumption and Recognition Agreement substantially in the form
of
Exhibit R-2, dated as of August 30, 2006, among EMC, the Trustee and First
Tennessee, evidencing the assignment of the First Horizon Assignment Agreement
to the Trust.
First
Horizon Loans:
Those
Mortgage Loans subject to this Agreement which were purchased by EMC from First
Horizon pursuant to the First Horizon Servicing Agreement.
First
Horizon Servicing Agreement:
the
Purchase, Warranties and Servicing Agreement, dated as of September 1, 2003,
as
amended on May 14, 2004, June 16, 2005, August 8, 2005 and December 22,
2005, among EMC, First Tennessee and First Horizon, substantially in the form
of
Exhibit R-1.
First
Tennessee:
First
Tennessee Mortgage Services, Inc and
any
successor thereto.
Fiscal
Quarter:
December 1 to February 29 (or the last day in such month), March 1 to May 31,
June 1 to August 31, or September 1 to November 30, as applicable.
Form
8-K Disclosure Information:
The
meaning set forth in Section 3.18(a)(iii).
Xxxxxxx
Mac:
Federal
Home Loan Mortgage Corporation, or any successor thereto.
Global
Certificate:
Any
Private Certificate registered in the name of the Depository or its nominee,
beneficial interests in which are reflected on the books of the Depository
or on
the books of a Person maintaining an account with such Depository (directly
or
as an indirect participant in accordance with the rules of such
depository).
GMAC
Mortgage Corporation or GMACM:
GMAC
Mortgage Corporation and any successor thereto.
GMACM
Assignment Agreement:
The
Assignment, Assumption and Recognition Agreement substantially in the form
of
Exhibit S-2, dated as of August 30, 2006, among EMC, the Trustee and GMACM,
evidencing the assignment of the GMACM Assignment Agreement to the
Trust.
GMACM
Loans:
Those
Mortgage Loans subject to this Agreement which were purchased by EMC from GMACM
pursuant to the GMACM Servicing Agreement.
GMACM
Servicing Agreement:
The
Servicing Agreement, dated as of May 1, 2001, as amended by Amendment No. 1,
dated as of October 1, 2001, Amendment No. 2, dated as of July 31, 2002 and
Amendment No. 3, dated as of December 20, 2005 substantially in the form of
Exhibit S-1, between EMC and GMACM.
Gross
Margin:
With
respect to each Adjustable Rate Mortgage Loan, the fixed percentage set forth
in
the related Mortgage Note that is added to the Index on each Adjustment Date
in
accordance with the terms of the related Mortgage Note used to determine the
Mortgage Rate for such Mortgage Loan.
HomeBanc:
HomeBanc Mortgage Corporation and any successor thereto.
HomeBanc
Assignment Agreement:
The
Assignment, Assumption and Recognition Agreement substantially in the form
of
Exhibit T-2, dated as of August 30, 2006, among EMC, the Trustee, and HomeBanc
evidencing the assignment of the HomeBanc Assignment Agreement to the
Trust.
HomeBanc
Loans:
Those
Mortgage Loans subject to this Agreement which were purchased by EMC from
HomeBanc pursuant to the HomeBanc Servicing Agreement.
HomeBanc
Servicing Agreement:
The
Purchase,
Warranties and Servicing Agreement, dated as of January 1, 2004, as amended
by
the Amended and Restated Amendment No. 1 to the Purchase, Warranties and
Servicing Agreement, dated as of January 27, 2006
substantially in the form of Exhibit T-1, between EMC and HomeBanc.
Indemnified
Persons:
The
Trustee, the Master Servicer, the Company, the Trust Fund and the Securities
Administrator, including LaSalle Bank National Association in its individual
capacity, and their respective officers, directors, agents and employees and,
with respect to the Trustee, any separate co-trustee and its officers,
directors, agents and employees.
Index:
With
respect to each Adjustable Rate Mortgage Loan and with respect to each related
Adjustment Date, the index as specified in the related Mortgage
Note.
Individual
Certificate:
Any
Private Certificate registered in the name of a Holder other than the Depository
or its nominee.
Initial
Certification:
The
certification by a Custodian substantially in the form of Exhibit One to the
related Custodial Agreement.
Initial
Certificate Principal Balance:
With
respect to any Certificate, the Certificate Principal Balance of such
Certificate or any predecessor Certificate on the Closing Date.
Institutional
Accredited Investor:
Any
Person meeting the requirements of Rule 501(a)(l), (2), (3) or (7) of Regulation
D under the Securities Act or any entity all of the equity holders in which
come
within such paragraphs.
Insurance
Policy:
With
respect to any Mortgage Loan included in the Trust Fund, any insurance policy,
including all riders and endorsements thereto in effect with respect to such
Mortgage Loan, including any replacement policy or policies for any Insurance
Policies.
Insurance
Proceeds:
Proceeds paid in respect of the Mortgage Loans pursuant to any Insurance Policy
and any other insurance policy covering a Mortgage Loan, to the extent such
proceeds are payable to the mortgagee under the Mortgage, the Company, the
related Servicer or the trustee under the deed of trust and are not applied
to
the restoration of the related Mortgaged Property or released to the Mortgagor
in accordance with the procedures that the Company or the related Servicer
would
follow in servicing mortgage loans held for its own account, in each case other
than any amount included in such Insurance Proceeds in respect of Insured
Expenses.
Insured
Expenses:
Expenses covered by any insurance policy with respect to the Mortgage
Loans.
Interest
Carry Forward Amount:
As of
any Distribution Date and with respect to each Class of Certificates (other
than
the Class C Certificates and the Residual Certificates), the sum of (i) the
excess of (a) the Current Interest for such Class with respect to such
Distribution Date and any prior Distribution Dates over (b) the amount actually
distributed to such Class of Certificates with respect to interest on such
Distribution Dates and (ii) interest thereon (to the extent permitted by
applicable law) at the applicable Pass-Through Rate for such Class for the
related Accrual Period including the Accrual Period relating to such
Distribution Date.
Interest
Determination Date:
Shall
mean the second LIBOR Business Day preceding the commencement of each Accrual
Period.
Interest
Funds:
With
respect to any Distribution Date (1) the sum, without duplication, of (a) all
scheduled interest during the related Due Period with respect to the Mortgage
Loans less the Servicing Fee and the Master Servicing Fee, if any, (b) all
Advances relating to interest with respect to the related Mortgage Loans made
on
or prior to the related Distribution Account Deposit Date, (c) all Compensating
Interest with respect to the Mortgage Loans and required to be remitted by
the
related Servicer or the Master Servicer pursuant to this Agreement with respect
to such Distribution Date, (d) Liquidation Proceeds and Subsequent Recoveries
with respect to the related Mortgage Loans collected during the related
Prepayment Period (to the extent such Liquidation Proceeds and Subsequent
Recoveries relate to interest), (e) all amounts relating to interest with
respect to each Mortgage Loan repurchased by EMC pursuant to Sections 2.02
and
2.03 and by EMC pursuant to Section 3.05, in each case to the extent remitted
by
the Master Servicer to the Distribution Account pursuant to this Agreement
and
(f) the interest portion of any proceeds received from the exercise of a
Optional Termination, minus (2)(i) all amounts relating to interest required
to
be reimbursed pursuant to Sections 5.02 and 5.09 or as otherwise set forth
in
this Agreement and (ii) any Net Swap Payment or Swap Termination Payment (not
due to a Swap Provider Trigger Event and to the extent not paid by the Swap
Administrator from any upfront payment received pursuant to any replacement
interest rate swap agreement that may be entered into by the Supplemental
Interest Trust Trustee) owed to the Swap Administrator for payment to the Swap
Provider for such Distribution Date and any such payments remaining unpaid
for
any prior Distribution Dates.
Interim
Certification:
The
certification by a Custodian substantially in the form of Exhibit Two to the
related Custodial Agreement.
LaSalle:
LaSalle
Bank National Association, and any successor in interest.
LaSalle
Custodial Agreement:
The
Custodial Agreement, dated as of August 30, 2006, among the Depositor, EMC,
as
Seller, the Master Servicer, the Securities Administrator, the Trustee and
LaSalle as Custodian relating to the Mortgage Loans identified in such Custodial
Agreement.
Last
Scheduled Distribution Date:
Solely
for purposes of the face of the Certificates, the Distribution Date in August
2036.
Latest
Possible Maturity Date:
The
Distribution Date in the month following the final scheduled maturity date
of
the Mortgage Loan in the Trust Fund having the latest scheduled maturity date
as
of the Cut-off Date. For purposes of the Treasury regulations under Sections
860A through 860G of the Code, the latest possible maturity date of each Regular
Interest issued by REMIC I, REMIC II, REMIC III, REMIC IV and REMIC V shall
be
the Latest Possible Maturity Date.
LIBOR
Business Day:
Shall
mean a day on which banks are open for dealing in foreign currency and exchange
in London and New York City.
Liquidated
Loan:
With
respect to any Distribution Date, a defaulted Mortgage Loan that has been
liquidated through deed-in-lieu of foreclosure, foreclosure sale, trustee’s sale
or other realization as provided by applicable law governing the real property
subject to the related Mortgage and any security agreements and as to which
the
Company or the related Servicer has made a Final Recovery Determination with
respect thereto.
Liquidation
Proceeds:
Amounts, other than Insurance Proceeds, received in connection with the partial
or complete liquidation of a Mortgage Loan, whether through trustee’s sale,
foreclosure sale or otherwise, or in connection with any condemnation or partial
release of a Mortgaged Property and any other proceeds received with respect
to
an REO Property, less the sum of related unreimbursed Advances, Servicing Fees
and Servicing Advances and all expenses of liquidation, including property
protection expenses and foreclosure and sale costs, including court and
reasonable attorneys fees.
Majority
Class C Certificateholder:
The
Holder of a 50.01% or greater Percentage Interest in the Class C
Certificates.
Marker
Rate:
With
respect to the Class C Interest and any Distribution Date, a per annum rate
equal to two (2) times the weighted average of the Uncertificated REMIC II
Pass-Through Rates for the REMIC II Regular Interests (other than REMIC II
Regular Interests AA and IO), with the rate on each such REMIC II Regular
Interest (other than REMIC II Regular Interest ZZ) subject to a cap equal to
the
least of (i) the One-Month LIBOR Pass-Through Rate for the Corresponding
Certificate, (ii) 11.00% per annum and (iii) the Net WAC Cap Rate for the REMIC
III
Regular
Interest the ownership of which is represented by the Corresponding Certificate
for the purpose of this calculation for such Distribution Date, and with the
rate on REMIC II Regular Interest ZZ subject to a cap of zero for the purpose
of
this calculation; provided, however, that solely for this purpose, the related
cap with respect to each REMIC II Regular Interest (other than REMIC II Regular
Interests AA, ZZ and IO) shall be multiplied by a fraction, the numerator of
which is 30 and the denominator of which is the actual number of days in the
related Accrual Period.
Master
Servicer:
LaSalle
Bank National Association, in its capacity as master servicer, and its
successors and assigns or any Successor Master Servicer appointed as herein
provided.
Master
Servicer Collection Account:
The
trust accounts or accounts created and maintained pursuant to Section 5.06
hereof, which shall be entitled “LaSalle Bank National Association, as master
servicer, on behalf of Citibank, N.A., as Trustee f/b/o holders of SACO I Trust
2006-9, Mortgage-Backed Certificates, Series 2006-9 - Master Servicer Collection
Account”. The Master Servicer Collection Account may be a sub-account of the
Distribution Account.
Master
Servicer Information:
As
defined in Section 3.18.
Master
Servicing Compensation:
For any
Distribution Date, the Master Servicing Fee for such Distribution
Date.
Master
Servicing Fee:
As to
each Mortgage Loan and any Distribution Date, an amount equal to 1/12th of
the
Master Servicing Fee Rate multiplied by the Stated Principal Balance of such
Mortgage Loan as of the Due Date in the month preceding the month in which
such
Distribution Date occurs.
Master
Servicing Fee Rate:
0.0210%
per annum.
Master
Servicing Officer:
Any
officer of the Master Servicer responsible for the master servicing of the
Mortgage Loans.
Maximum
Mortgage Rate:
With
respect to each Adjustable Rate Mortgage Loan, the percentage set forth in
the
related Mortgage Note as the maximum Mortgage Rate thereunder.
Maximum
Uncertificated Accrued Interest Deferral Amount:
With
respect to any Distribution Date, the excess of (i) accrued interest at the
Uncertificated REMIC II Pass-Through Rate applicable to REMIC II Regular
Interest ZZ for such Distribution Date on a balance equal to the Uncertificated
Principal Balance of REMIC II Regular Interest ZZ minus the REMIC II
Overcollateralization Amount, in each case for such Distribution Date, over
(ii)
the aggregate amount of Uncertificated Accrued Interest for such Distribution
Date on the REMIC II Regular Interests (other than REMIC II Regular Interests
AA, ZZ and IO), with the rate on each such REMIC II Regular Interest subject
to
a cap equal to the least of (x) the One-Month LIBOR Pass Through Rate for the
Corresponding Certificate, (y) 11.00% per annum and (z) the Net WAC Cap Rate
for
the REMIC III Regular Interest the ownership of which is represented by the
Corresponding Certificate for the purpose of this calculation for such
Distribution Date; provided, however, that solely for this purpose, the related
cap with respect to each REMIC II Regular Interest (other than REMIC II Regular
Interests AA, ZZ and IO) shall be multiplied by a fraction, the numerator of
which is 30 and the denominator of which is the actual number of days in the
related Accrual Period.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS®
System:
The
system of recording transfers of Mortgages electronically maintained by
MERS.
MIN:
The
Mortgage Identification Number for Mortgage Loans registered with MERS on the
MERS® System.
Minimum
Mortgage Rate:
With
respect to each Adjustable Rate Mortgage Loan, the percentage set forth in
the
related Mortgage Note as the minimum Mortgage Rate thereunder.
MOM
Loan:
With
respect to any Mortgage Loan, MERS acting as the mortgagee of such Mortgage
Loan, solely as nominee for the originator of such Mortgage Loan and its
successors and assigns, at the origination thereof.
Monthly
Statement:
The
statement prepared and delivered by the Securities Administrator pursuant to
Section 6.06.
Moody’s:
Xxxxx’x
Investors Service, Inc., and any successor thereto.
Mortgage:
The
mortgage, deed of trust or other instrument creating a second lien on or second
priority ownership interest in an estate in fee simple in real property securing
a Mortgage Note.
Mortgage
File:
The
mortgage documents listed in Section 2.01 hereof pertaining to a particular
Mortgage Loan and any additional documents delivered to the related Custodian
to
be added to the Mortgage File pursuant to this Agreement and the related
Custodial Agreement.
Mortgage
Loan Purchase Agreement:
The
Mortgage Loan Purchase Agreement, dated as of August 30, 2006, between EMC
as
Seller and the Depositor as purchaser, in the form attached hereto as Exhibit
L.
Mortgage
Loan Purchase Price:
The
price, calculated as set forth in Section 11.01, to be paid in connection with
the repurchase of the Mortgage Loans pursuant to Section 11.01.
Mortgage
Loans:
Such of
the mortgage loans transferred and assigned to the Trustee pursuant to the
provisions hereof, as from time to time are held as a part of the Trust Fund
(including any REO Property), notwithstanding foreclosure or other acquisition
of title of the related Mortgaged Property.
Mortgage
Loan Schedule:
The
list of Mortgage Loans (as from time to time amended by the Company or the
Master Servicer to reflect the deletion of Deleted Mortgage Loans and the
addition of Replacement Mortgage Loans pursuant to the provisions of this
Agreement) transferred to the Trustee as part of the Trust Fund and from time
to
time subject to this Agreement, the Mortgage Loan Schedule being attached hereto
as Exhibit B, with respect to the Mortgage Loans and as amended from time to
time to reflect the repurchase or substitution of Mortgage Loans pursuant to
this Agreement or the Mortgage Loan Purchase Agreement, as the case may be,
setting forth the following information with respect to each Mortgage
Loan:
(a) the
city,
state and zip code of the Mortgaged Property;
(b) the
property type;
(c) the
Mortgage Interest Rate;
(d) the
Servicing Fee Rate;
(e) the
Master Servicer's Fee Rate;
(f) the
LPMI
Fee; if applicable;
(g) the
Net
Rate;
(h) the
maturity date;
(i) the
stated original term to maturity;
(j) the
stated remaining term to maturity;
(k) the
original Principal Balance;
(l) the
first
payment date;
(m) the
principal and interest payment in effect as of the Cut-off Date;
(n) the
unpaid Principal Balance as of the Cut-off Date;
(o) the
Loan-to-Value Ratio at origination;
(p) the
insurer of any Primary Mortgage Insurance Policy;
(q) the
MIN
with respect to each MOM Loan;
(r) the
Gross
Margin, if applicable;
(s) the
next
Adjustment Date, if applicable;
(t) the
Maximum Mortgage Rate, if applicable;
(u) the
Minimum Mortgage Rate, if applicable;
(v) the
Periodic Rate Cap, if applicable;
(w) the
Loan
Group, if applicable;
(x) a
code
indicating whether the Mortgage Loan is negatively amortizing;
(y) which
Mortgage Loans adjust after an initial fixed-rate period of one, two, three,
five, seven or ten years or any other period;
(z) the
Prepayment Charge, if any;
(aa) lien
position (e.g., first lien or second lien);
(bb) a
code
indicating whether the Mortgage Loan is has a balloon payment;
(cc) a
code
indicating whether the Mortgage Loan is an interest-only loan;
(dd) the
interest-only term, if applicable;
(ee) the
Mortgage Loan Seller; and
(ff) the
original amortization term.
Such
schedule also shall set forth for all of the Mortgage Loans, the total number
of
Mortgage Loans, the total of each of the amounts described under (n) and (j)
above, the weighted average by principal balance as of the Cut-off Date of
each
of the rates described under (c) through (h) above, and the weighted average
remaining term to maturity by unpaid principal balance as of the Cut-off
Date.
Mortgage
Note:
The
original executed note or other evidence of indebtedness of a Mortgagor under
a
Mortgage Loan.
Mortgage
Rate:
With
respect to each fixed rate Mortgage Loan, the rate set forth in the related
Mortgage Note. With respect to each Adjustable Rate Mortgage Loan, the annual
rate at which interest accrues on such Mortgage Loan from time to time in
accordance with the provisions of the related Mortgage Note, which rate (A)
as
of any date of determination until the first Adjustment Date following the
Cut-off Date shall be the rate set forth in the Mortgage Loan Schedule as the
Mortgage Rate in effect immediately following the Cut-off Date and (B) as of
any
date of determination thereafter shall be the rate as adjusted on the most
recent Adjustment Date, to equal the sum, rounded to the next highest or nearest
0.125% (as provided in the Mortgage Note), of the Index, determined as set
forth
in the related Mortgage Note, plus the related Gross Margin subject to the
limitations set forth in the related Mortgage Note. With respect to each
Mortgage Loan that becomes an REO Property, as of any date of determination,
the
annual rate determined in accordance with the immediately preceding sentence
as
of the date such Mortgage Loan became an REO Property.
Mortgaged
Property:
The
underlying property securing a Mortgage Loan.
Mortgagor:
The
obligors on a Mortgage Note.
Net
Mortgage Rate:
As to
each Mortgage Loan, and at any time, the per annum rate equal to the related
Mortgage Rate less the sum of (i) the Servicing Fee Rate and (ii) the Master
Servicing Fee Rate.
Net
Swap Payment:
With
respect to each Distribution Date, the net payment required to be made pursuant
to the terms of the Swap Agreement by either the Swap Provider or the Swap
Administrator, which net payment shall not take into account any Swap
Termination Payment.
Net
WAC Cap Rate:
With
respect to any Distribution Date and any Class of Class A, Class M or Class
B
Certificates, a per annum rate equal to the excess, if any, of (A) the weighted
average of the Net Mortgage Rates on the then outstanding Mortgage Loans,
weighted based on their Stated Principal Balances as of the related Due Date
prior to giving effect to any reduction in the Stated Principal Balances of
such
Mortgage Loans on such Due Date, over (B) a per annum rate equal to the sum
of
the Net Swap Payment and Swap Termination Payment not due to a Swap Provider
Trigger Event payable to the Swap Provider, in each case on such Distribution
Date (to the extent not paid by the Supplemental Interest Trust from any upfront
payment received pursuant to any replacement interest rate swap agreement that
may be entered into by the Supplemental Interest Trust Trustee), divided by
the
outstanding
Stated
Principal Balance of the Mortgage Loans
as of
the related Due Date prior to giving effect to any reduction in the Stated
Principal Balances of such Mortgage Loans on such due date, multiplied by
12.
The Net
WAC Cap Rate for such Classes of Certificates will be will be calculated based
on a 360-day year and the actual number of days elapsed in the related Accrual
Period. With respect to any Distribution Date and each REMIC III Regular
Interest the ownership of which is represented by a Class A, Class M or Class
B
Certificate, a per annum rate equal to the weighted average (adjusted for the
actual number of days elapsed in the related Accrual Period) of the
Uncertificated REMIC II Pass-Through Rates on the REMIC II Regular Interests
(other than REMIC II Regular Interest IO), weighted on the basis of the
Uncertificated Principal Balances of each such REMIC II Regular Interest
immediately prior to such Distribution Date.
Non-Book-Entry
Certificate:
Any
Certificate other than a Book-Entry Certificate.
Nonrecoverable
Advance:
Any
portion of an Advance previously made or proposed to be made by the Company
or
the Master Servicer pursuant to this Agreement that, in the good faith judgment
of the Company or the Master Servicer, will not or, in the case of a proposed
advance, would not, be ultimately recoverable by it from the related Mortgagor,
related Liquidation Proceeds, Insurance Proceeds or otherwise.
Notional
Amount:
With
respect to each Distribution Date and the Swap Agreement, the notional amount
for the related calculation period as set forth in the related schedule set
forth in Exhibit N.
Offered
Certificates:
Any of
the Class A, Class M, Class B-1, Class B-2 and Class B-3
Certificates.
Officer’s
Certificate:
A
certificate (i) signed by the Chairman of the Board, the Vice Chairman of the
Board, the President, a Vice President (however denominated), an Assistant
Vice
President, the Treasurer, the Secretary, or one of the assistant treasurers
or
assistant secretaries of the Depositor, the Seller or the Master Servicer (or
any other officer customarily performing functions similar to those performed
by
any of the above designated officers and also to whom, with respect to a
particular matter, such matter is referred because of such officer’s knowledge
of and familiarity with a particular subject) or (ii), if provided for in this
Agreement, signed by a Servicing Officer, as the case may be, and delivered
to
the Depositor, the Seller, the Securities Administrator, the Master Servicer
and/or the Trustee, as the case may be, as required by this
Agreement.
One-Month
LIBOR:
With
respect to any Accrual Period, the rate determined by the Securities
Administrator on the related Interest Determination Date on the basis of the
rate for U.S. dollar deposits for one month that appears on Telerate Screen
Page
3750 as of 11:00 a.m. (London time) on such Interest Determination Date. If
such
rate does not appear on such page (or such other page as may replace that page
on that service, or if such service is no longer offered, such other service
for
displaying One-Month LIBOR or comparable rates as may be reasonably selected
by
the Securities Administrator), One-Month LIBOR for the applicable Accrual Period
will be the Reference Bank Rate. If no such quotations can be obtained by the
Securities Administrator and no Reference Bank Rate is available, One-Month
LIBOR will be One-Month LIBOR applicable to the preceding Accrual Period. The
establishment of One-Month LIBOR on each Interest Determination Date by the
Securities Administrator and the Securities Administrator’s calculation of the
rate of interest applicable to the Class A, Class M and Class B Certificates
for
the related Accrual Period shall, in the absence of manifest error, be final
and
binding.
One-Month
LIBOR Pass-Through Rate:
With
respect to each Class A, Class M and Class B Certificate and, for purposes
of
the definitions of “Marker Rate”, “Maximum Uncertificated Accrued Interest
Deferral Amount”, the related REMIC III Regular Interest for which such
Certificate is the Corresponding Certificate, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
Opinion
of Counsel:
A
written opinion of counsel, who may be counsel for EMC, the Depositor, the
Company or the Master Servicer, reasonably acceptable to each addressee of
such
opinion; provided that with respect to Section 2.05, 8.05, 8.07 or 12.01, or
the
interpretation or application of the REMIC Provisions, such counsel must (i)
in
fact be independent of EMC, Depositor, the Company and the Master Servicer,
(ii)
not have any direct financial interest in EMC, the Depositor, the Company or
the
Master Servicer or in any affiliate of either, and (iii) not be connected with
EMC, the Depositor, the Company or the Master Servicer as an officer, employee,
promoter, underwriter, trustee, partner, director or person performing similar
functions.
Optional
Termination:
The
termination of the Trust created hereunder as a result of the purchase of all
of
the Mortgage Loans and any REO Property pursuant to Section 11.01
hereof.
Optional
Termination Date:
The
Distribution Date on which the aggregate Stated Principal Balance of all
of the
Mortgage Loans is equal to or less than 20% of the aggregate Stated Principal
Balance of all of the Mortgage Loans as of the Cut-off Date.
Original
Value:
The
value of the property underlying a Mortgage Loan based, in the case of the
purchase of the underlying Mortgaged Property, on the lower of an appraisal
or
the sales price of such property or, in the case of a refinancing, on an
appraisal.
Outstanding:
With
respect to the Certificates as of any date of determination, all Certificates
theretofore executed and authenticated under this Agreement except:
(a) Certificates
theretofore canceled by the Securities Administrator or delivered to the
Securities Administrator for cancellation; and
(b) Certificates
in exchange for which or in lieu of which other Certificates have been executed
and delivered by the Securities Administrator pursuant to this
Agreement.
Outstanding
Mortgage Loan:
As of
any date of determination, a Mortgage Loan with a Stated Principal Balance
greater than zero that was not the subject of a Principal Prepayment in full,
and that did not become a Liquidated Loan, prior to the end of the related
Prepayment Period.
Overcollateralization
Amount:
With
respect to any Distribution Date, the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after
giving effect to scheduled payments of principal due during the related Due
Period, to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period, and after reduction
for
Realized Losses incurred during the related Due Period) over
the
aggregate Certificate Principal Balance of the Certificates (other than the
Class C Certificates) on such Distribution Date (after taking into account
the
payment of principal other than any Extra Principal Distribution Amount on
such
Certificates).
Overcollateralization
Floor:
With
respect to the Certificates, an amount equal to 0.50% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Cut-off Date.
Overcollateralization
Release Amount:
With
respect to any Distribution Date, the lesser of (x) the Principal Funds for
such
Distribution Date and (y) the excess, if any, of (i) the Overcollateralization
Amount for such Distribution Date (assuming that 100% of the Principal Funds
is
applied as a principal payment on such Distribution Date) over (ii) the
Overcollateralization Target Amount for such Distribution Date (with the amount
pursuant to clause (y) deemed to be $0 if the Overcollateralization Amount
is
less than or equal to the Overcollateralization Target Amount on that
Distribution Date).
Overcollateralization
Target Amount:
With
respect to any Distribution Date (a) prior to the Stepdown Date, 5.00% of the
aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-off
Date,
(b) on or after the Stepdown Date and if a Trigger Event is not in effect,
the
greater of (i) the lesser of (1) 5.00% of the aggregate Stated Principal Balance
of the Mortgage Loans as of the Cut-off Date and (2) 10.00% of the then current
aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of
the related Due Period (after giving effect to scheduled payments of principal
due during the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the related
Due
Period) and (ii) the Overcollateralization Floor or (c) on or after the Stepdown
Date and if a Trigger Event is in effect, the Overcollateralization Target
Amount for the immediately preceding Distribution Date.
Ownership
Interest:
As to
any Certificate, any ownership interest in such Certificate including any
interest in such Certificate as the Holder thereof and any other interest
therein, whether direct or indirect, legal or beneficial.
Pass-Through
Rate:
With
respect to the Class A, Class M and Class B Certificates and any Distribution
Date, a rate per annum equal to the least of (i) the related One-Month LIBOR
Pass-Through Rate for such Distribution Date, (ii) 11.00% per annum and (iii)
the Net WAC Cap Rate for such Distribution Date.
With
respect to the Class C Interest and any Distribution Date, a rate per annum
equal to the percentage equivalent of a fraction, the numerator of which is
the
sum of the amount determined for each REMIC II Regular Interest (other than
REMIC II Regular Interest IO) equal to the product of (a) the excess, if any,
of
the Uncertificated REMIC II Pass-Through Rate for such REMIC II Regular Interest
over the Marker Rate and (b) a notional amount equal to the Uncertificated
Principal Balance of such REMIC II Regular Interest, and the denominator of
which is the aggregate Uncertificated Principal Balance of such REMIC II Regular
Interests.
With
respect to the Class C Certificate, the Class C Certificate shall not have
a
Pass-Through Rate, but Current Interest for such Certificate and each
Distribution Date shall be an amount equal to 100% of the amounts distributable
to the Class C Interest for such Distribution Date.
With
respect to the Class IO Interest, Class IO Interest shall not have a
Pass-Through Rate, but Current Interest for such interest and each Distribution
Date shall be an amount equal to 100% of the amounts distributable to REMIC
II
Regular Interest IO for such Distribution Date.
With
respect to REMIC V Regular Interest IO, REMIC V Regular Interest IO shall not
have a Pass-Through Rate, but Current Interest for such Regular Interest and
each Distribution Date shall be an amount equal to 100% of the amounts
distributable to the Class IO Interest for such Distribution Date.
Pass-Through
Transfer:
Any
transaction involving either (1) a sale or other transfer of mortgage loans
directly or indirectly to an issuing entity in connection with an issuance
of
publicly offered or privately placed, rated or unrated mortgage-backed
securities or (2) an issuance of publicly offered or privately placed, rated
or
unrated securities, the payments on which are determined primarily by reference
to one or more portfolios of residential mortgage loans.
Percentage
Interest:
With
respect to any Certificate of a specified Class, the Percentage Interest set
forth on the face thereof or the percentage obtained by dividing the
Denomination of such Certificate by the aggregate of the Denominations of all
Certificates of such Class.
Periodic
Rate Cap:
With
respect to each Adjustable Rate Mortgage Loan and any Adjustment Date therefor,
the fixed percentage set forth in the related Mortgage Note, which is the
maximum amount by which the Mortgage Rate for such Mortgage Loan may increase
or
decrease (without regard to the Maximum Mortgage Rate or the Minimum Mortgage
Rate) on such Adjustment Date from the Mortgage Rate in effect immediately
prior
to such Adjustment Date.
Permitted
Investments:
At any
time, any one or more of the following obligations and securities:
(i) obligations
of the United States or any agency thereof, provided such obligations are backed
by the full faith and credit of the United States;
(ii) general
obligations of or obligations guaranteed by any state of the United States
or
the District of Columbia receiving the highest long-term debt rating of each
Rating Agency, or such lower rating as will not result in the downgrading or
withdrawal of the ratings then assigned to the Certificates by each Rating
Agency, as evidenced in writing;
(iii) commercial
or finance company paper which is then receiving the highest commercial or
finance company paper rating of each Rating Agency, or such lower rating as
will
not result in the downgrading or withdrawal of the ratings then assigned to
the
Certificates by each Rating Agency, as evidenced in writing;
(iv) certificates
of deposit, demand or time deposits, or bankers’ acceptances issued by any
depository institution or trust company incorporated under the laws of the
United States or of any state thereof and subject to supervision and examination
by federal and/or state banking authorities (including the Trustee, the Master
Servicer and the Securities Administrator in its commercial banking capacity),
provided that the commercial paper and/or long term unsecured debt obligations
of such depository institution or trust company are then rated one of the two
highest long-term and the highest short-term ratings of each Rating Agency
for
such securities, or such lower ratings as will not result in the downgrading
or
withdrawal of the rating then assigned to the Certificates by each Rating
Agency, as evidenced in writing;
(v) guaranteed
reinvestment agreements issued by any bank, insurance company or other
corporation containing, at the time of the issuance of such agreements, such
terms and conditions as will not result in the downgrading or withdrawal of
the
rating then assigned to the Certificates by each Rating Agency, as evidenced
in
writing;
(vi) repurchase
obligations with respect to any security described in clauses (i) and (ii)
above, in either case entered into with a depository institution or trust
company (acting as principal) described in clause (v) above;
(vii) securities
(other than stripped bonds, stripped coupons or instruments sold at a purchase
price in excess of 115% of the face amount thereof) bearing interest or sold
at
a discount issued by any corporation incorporated under the laws of the United
States or any state thereof which, at the time of such investment, have one
of
the two highest short term ratings of each Rating Agency (except if the Rating
Agency is Moody’s, such rating shall be the highest commercial paper rating of
Moody’s for any such securities), such lower rating as will not result in the
downgrading or withdrawal of the rating then assigned to the Certificates by
any
Rating Agency, as evidenced by a signed writing delivered by each Rating
Agency;
(viii) interests
in any money market fund (including any such fund managed or advised by the
Master Servicer and the Securities Administrator or any affiliate thereof)
which
at the date of acquisition of the interests in such fund and throughout the
time
such interests are held in such fund has the highest applicable short term
rating by each Rating Agency rating such fund, such lower rating as will not
result in the downgrading or withdrawal of the ratings then assigned to the
Certificates by each Rating Agency, as evidenced in writing;
(ix) short
term investment funds sponsored by any trust company or banking association
incorporated under the laws of the United States or any state thereof (including
any such fund managed or advised by the Trustee or the Master Servicer or the
Securities Administrator or any affiliate thereof) which on the date of
acquisition has been rated by each Rating Agency in their highest applicable
rating category or such lower rating as will not result in the downgrading
or
withdrawal of the ratings then assigned to the Certificates by each Rating
Agency, as evidenced in writing; and
(x) such
other investments having a specified stated maturity and bearing interest or
sold at a discount acceptable to each Rating Agency and will not result in
the
downgrading or withdrawal of the rating then assigned to the Certificates by
each Rating Agency, as evidenced by a signed writing delivered by each Rating
Agency;
provided,
that no such instrument shall be a Permitted Investment if such instrument
(i)
evidences the right to receive interest only payments with respect to the
obligations underlying such instrument, (ii) is purchased at a premium or (iii)
is purchased at a deep discount; provided further that no such instrument shall
be a Permitted Investment (A) if such instrument evidences principal and
interest payments derived from obligations underlying such instrument and the
interest payments with respect to such instrument provide a yield to maturity
of
greater than 120% of the yield to maturity at par of such underlying
obligations, or (B) if it may be redeemed at a price below the purchase price
(the foregoing clause (B) not to apply to investments in units of money market
funds pursuant to clause (viii) above); provided further that no amount
beneficially owned by any REMIC may be invested in investments (other than
money
market funds) treated as equity interests for federal income tax purposes,
unless the Securities Administrator shall receive an Opinion of Counsel, at
the
expense of the Securities Administrator, to the effect that such investment
will
not adversely affect the status of any such REMIC as a REMIC under the Code
or
result in the imposition of a tax on any such REMIC. Permitted Investments
that
are subject to prepayment or call may not be purchased at a price in excess
of
par.
Permitted
Transferee:
Any
person (x) other than (i) the United States, any State or political subdivision
thereof, any possession of the United States or any agency or instrumentality
of
any of the foregoing, (ii) a foreign government, International Organization
or
any agency or instrumentality of either of the foregoing, (iii) an organization
(except certain farmers’ cooperatives described in section 521 of the Code) that
is exempt from tax imposed by Chapter 1 of the Code (including the tax imposed
by section 511 of the Code on unrelated business taxable income) on any excess
inclusions (as defined in section 860E(c)(1) of the Code) with respect to any
Residual Certificate, (iv) rural electric and telephone cooperatives described
in section 1381(a)(2)(C) of the Code or (v) an electing large partnership within
the meaning of Section 775(a) of the Code, (y) that is a citizen or resident
of
the United States, a corporation, partnership (other than a partnership that
has
any direct or indirect foreign partners) or other entity (treated as a
corporation or a partnership for federal income tax purposes), created or
organized in or under the laws of the United States, any State thereof or the
District of Columbia, an estate whose income from sources without the United
States is includible in gross income for United States federal income tax
purposes regardless of its connection with the conduct of a trade or business
within the United States, or a trust if a court within the United States is
able
to exercise primary supervision over the administration of the trust and one
or
more United States persons have authority to control all substantial decisions
of the trust or if it has a valid election in effect under applicable U.S.
Treasury regulations to be treated as a United States person and (z) other
than
any other Person so designated by the Securities Administrator based upon an
Opinion of Counsel addressed to the Securities Administrator and the Trustee
(which shall not be an expense of the Trustee or the Securities Administrator)
that states that the Transfer of an Ownership Interest in a Residual Certificate
to such Person may cause REMIC I, REMIC II, REMIC III, REMIC IV or REMIC V
to
fail to qualify as a REMIC at any time that any Certificates are Outstanding.
The terms “United States,” “State” and “International Organization” shall have
the meanings set forth in section 7701 of the Code or successor provisions.
A
corporation will not be treated as an instrumentality of the United States
or of
any State or political subdivision thereof for these purposes if all of its
activities are subject to tax and, with the exception of Xxxxxxx Mac, a majority
of its board of directors is not selected by such government unit.
Person:
Any
individual, corporation, partnership, joint venture, association, joint- stock
company, limited liability company, trust, unincorporated organization or
government, or any agency or political subdivision thereof.
Piggyback
Loan:
A
second lien Mortgage Loan originated by the same originator to the same borrower
at the same time as the first lien Mortgage Loan, each secured by the same
Mortgaged Property.
Prepayment
Assumption:
A
prepayment rate for the Mortgage Loans of 35% CPR.
Prepayment
Charge:
Any
prepayment premium, penalty or charge payable by a Mortgagor in connection
with
any Principal Prepayment on a Mortgage Loan pursuant to the terms of the related
Mortgage Note.
Prepayment
Charge Waiver Amount:
Any
amount paid by the Company to the Master Servicer in respect of a waived
Prepayment Charge pursuant to Section 5.01(a) or by the related Servicer to
the
Master Servicer pursuant to the related Servicing Agreement.
Prepayment
Interest Excess:
With
respect to any Distribution Date, for each EMC Mortgage Loan that was the
subject of a Principal Prepayment in full or in part during the portion of
the
related Prepayment Period occurring between the first day of the calendar month
in which such Distribution Date occurs and the Determination Date of the
calendar month in which such Distribution Date occurs, an amount equal to
interest (to the extent received) at the applicable Net Mortgage Rate on the
amount of such Principal Prepayment for the number of days commencing on the
first day of the calendar month in which such Distribution Date occurs and
ending on the last date through which interest is collected from the related
Mortgagor.
Prepayment
Interest Shortfall:
With
respect to any Distribution Date, for each Mortgage Loan that was the subject
of
a partial Principal Prepayment, or a Principal Prepayment in full during the
related Prepayment Period, or that became a Liquidated Loan during the prior
calendar month, (other than a Principal Prepayment in full resulting from the
purchase of a Mortgage Loan pursuant to Section 2.02, 2.03, 3.05 or 11.01
hereof), the amount, if any, by which (i) one month’s interest at the applicable
Net Mortgage Rate on the Stated Principal Balance of such Mortgage Loan
immediately prior to such Principal Prepayment (or liquidation) or in the case
of a partial Principal Prepayment on the amount of such prepayment (or
liquidation proceeds) exceeds (ii) the amount of interest paid or collected
in
connection with such Principal Prepayment or such liquidation proceeds less
the
sum of (a) the Master Servicing Fee and (b) the Servicing Fee.
Prepayment
Period:
As to
any Distribution Date (except the first Distribution Date) and (i) each EMC
Mortgage Loan, the period commencing on the 16th day of the month prior to
the
month in which the related Distribution Date occurs and ending on the 15th
day
of the month in which such Distribution Date occurs (as to the first
Distribution Date and any EMC Mortgage Loan, the period commencing on
the Cut-off Date and ending on the 15th day of the month in which such
Distribution Date occurs) and (ii) any other Mortgage Loan, the period set
forth
in the related Servicing Agreement.
Principal
Distribution Amount:
With
respect to any Distribution Date, an amount equal to (x) the sum of (1) the
Principal Funds for such Distribution Date and (2) any Extra Principal
Distribution Amount for such Distribution Date minus (y) the amount of any
Overcollateralization Release Amount for such Distribution Date.
Principal
Funds:
With
respect to any Distribution Date, (1) the sum, without duplication, of (a)
all
scheduled principal collected during the related Due Period, (b) all Advances
relating to principal made on or before the Distribution Account Deposit Date,
(c) Principal Prepayments exclusive of prepayment charges or penalties collected
during the related Prepayment Period, (d) the Stated Principal Balance of each
Mortgage Loan that was repurchased by EMC pursuant to Sections 2.02, 2.03 and
by
EMC pursuant to Section 3.05, (e) the aggregate of all Substitution Adjustment
Amounts for the related Determination Date in connection with the substitution
of any Mortgage Loans pursuant to Section 2.03(d), (f) all Liquidation Proceeds
and Subsequent Recoveries collected during the related Prepayment Period (to
the
extent such Liquidation Proceeds and Subsequent Recoveries relate to principal),
in each case to the extent remitted by the Master Servicer to the Distribution
Account pursuant to this Agreement and (g) the principal portion of any proceeds
received from the exercise of a Optional Termination, pursuant to Section 11.01,
minus (2)(i) all amounts required to be reimbursed pursuant to Sections 5.02
and
5.09 or as otherwise set forth in this Agreement and (ii) any Net Swap Payments
or Swap Termination Payments (not due to a Swap Provider Trigger Event and
to
the extent not paid by the Swap Administrator from any upfront payment received
pursuant to any replacement interest rate swap agreement that may be entered
into by the Supplemental Interest Trust Trustee) owed to the Swap Administrator
for payment to the Swap Provider for such Distribution Date and any such
payments remaining unpaid for any prior Distribution Dates, in each case to
the
extent not paid from Interest Funds.
Principal
Prepayment:
Any
Mortgagor payment or other recovery of (or proceeds with respect to) principal
on a Mortgage Loan (including loans purchased or repurchased under Sections
2.02, 2.03, 3.05 and 11.01 hereof) that is received in advance of its scheduled
Due Date and is not accompanied by an amount as to interest representing
scheduled interest due on any date or dates in any month or months subsequent
to
the month of prepayment. Partial Principal Prepayments shall be applied by
the
Company or the related Servicer, as appropriate, in accordance with the terms
of
the related Mortgage Note.
Private
Certificates:
Any of
the Class B-4, Class C and Residual Certificates.
Prospectus
Supplement:
The
Prospectus Supplement dated August 29, 2006 relating to the public offering
of
the Offered Certificates.
Protected
Account:
Each
account established with respect to receipts on the Mortgage Loans and REO
Property in accordance with Section 5.01 hereof or by a Servicer in accordance
with the related Servicing Agreement. Each Protected Account shall be an
Eligible Account.
PUD:
A
Planned Unit Development.
Purchase
Price:
With
respect to any Mortgage Loan (x) required to be repurchased by the Seller
pursuant to Section 2.02 or 2.03 hereof or (y) that EMC has a right to purchase
pursuant to Section 3.05 hereof, an amount equal to the sum of (i) 100% of
the
outstanding principal balance of the Mortgage Loan as of the date of such
purchase (or if the related Mortgaged Property was acquired with respect
thereto, 100% of the outstanding principal balance at the date of the
acquisition), plus (ii) accrued interest thereon at the applicable Mortgage
Rate
through the first day of the month in which the Purchase Price is to be
distributed to Certificateholders, reduced by any portion of the Servicing
Fee,
Servicing Advances and Advances payable to the purchaser of the Mortgage Loan
plus and (iii) any costs and damages (if any) incurred by the Trust in
connection with any violation of such Mortgage Loan of any anti-predatory
lending laws.
QIB:
A
Qualified Institutional Buyer as defined in Rule 144A promulgated under the
Securities Act.
Rating
Agency:
Each of
S&P and Xxxxx’x. If any such organization or its successor is no longer in
existence, “Rating Agency” shall be a nationally recognized statistical rating
organization, or other comparable Person, designated by the Depositor, notice
of
which designation shall be given to the Trustee and the Securities
Administrator. References herein to a given rating category of each Rating
Agency shall mean such rating category without giving effect to any
modifiers.
Realized
Loss:
With
respect to each Mortgage Loan as to which a Final Recovery Determination
has
been made, an amount (not less than zero) equal to (i) the unpaid principal
balance of such Mortgage Loan as of the commencement of the calendar month
in
which the Final Recovery Determination was made, plus (ii) accrued interest
from
the Due Date as to which interest was last paid by the Mortgagor through
the end
of the calendar month in which such Final Recovery Determination was made,
calculated in the case of each calendar month during such period (A) at an
annual rate equal to the annual rate at which interest was then accruing
on such
Mortgage Loan and (B) on a principal amount equal to the Stated Principal
Balance of such Mortgage Loan as of the close of business on the Distribution
Date during such calendar month, minus (iii) the proceeds, if any, received
in
respect of such Mortgage Loan during the calendar month in which such Final
Recovery Determination was made, net of amounts that are payable therefrom
to
the Company pursuant to this Agreement or the related Servicer pursuant to
the
related Servicing Agreement. With respect to each Mortgage Loan which is
the
subject of a Servicing Modification, (a) (1) the amount by which the interest
portion of a monthly payment or the principal balance of such Mortgage Loan
was
reduced or (2) the sum of any other amounts owing under the Mortgage Loan
that
were forgiven and that constitute Servicing Advances that are reimbursable
to
the related Servicer, and (b) any such amount with respect to a monthly payment
that was or would have been due in the month immediately following the month
in
which a Principal Prepayment or the Purchase Price of such Mortgage Loan
is
received or is deemed to have been received and not paid due to a Servicing
Modification. In addition, to the extent the Company, the Servicer or the
Master Servicer receives Subsequent Recoveries with respect to any Mortgage
Loan, the amount of the Realized Loss with respect to that Mortgage Loan
will be
reduced to the extent such recoveries are distributed to any Class of
Certificates or applied to increase the Excess Spread on any Distribution
Date.
With
respect to any REO Property as to which a Final Recovery Determination has
been
made, an amount (not less than zero) equal to (i) the unpaid principal balance
of the related Mortgage Loan as of the date of acquisition of such REO Property
on behalf of REMIC I, plus (ii) accrued interest from the Due Date as to which
interest was last paid by the Mortgagor in respect of the related Mortgage
Loan
through the end of the calendar month immediately preceding the calendar month
in which such REO Property was acquired, calculated in the case of each calendar
month during such period (A) at an annual rate equal to the annual rate at
which
interest was then accruing on the related Mortgage Loan and (B) on a principal
amount equal to the Stated Principal Balance of the related Mortgage Loan as
of
the close of business on the Distribution Date during such calendar month,
plus
(iii) REO Imputed Interest for such REO Property for each calendar month
commencing with the calendar month in which such REO Property was acquired
and
ending with the calendar month in which such Final Recovery Determination was
made, minus (iv) the aggregate of all unreimbursed Advances and Servicing
Advances.
With
respect to each Mortgage Loan which has become the subject of a Deficient
Valuation, the difference between the principal balance of the Mortgage Loan
outstanding immediately prior to such Deficient Valuation and the principal
balance of the Mortgage Loan as reduced by the Deficient Valuation.
With
respect to each Mortgage Loan which has become the subject of a Debt Service
Reduction, the portion, if any, of the reduction in each affected Monthly
Payment attributable to a reduction in the Mortgage Rate imposed by a court
of
competent jurisdiction. Each such Realized Loss shall be deemed to have been
incurred on the Due Date for each affected Monthly Payment.
Record
Date:
With
respect to any Distribution Date and the Certificates (other than the Class
C
Certificates and Residual Certificates), so long as such Classes of Certificates
are Book-Entry Certificates, the Business Day preceding such Distribution Date,
and otherwise, the close of business on the last Business Day of the month
preceding the month in which such Distribution Date occurs. With respect to
the
Class C Certificates and Residual Certificates, so long as such classes of
Certificates remain non Book-Entry Certificates, the close of business on the
last Business Day of the month preceding the month in which such Distribution
Date occurs.
Reference
Banks:
Shall
mean leading banks selected by the Securities Administrator and engaged in
transactions in Eurodollar deposits in the international Eurocurrency market
(i)
with an established place of business in London, (ii) which have been designated
as such by the Securities Administrator and (iii) which are not controlling,
controlled by, or under common control with, the Depositor, the Seller or the
Master Servicer.
Reference
Bank Rate:
With
respect to any Accrual Period shall mean the arithmetic mean, rounded upwards,
if necessary, to the nearest whole multiple of 0.03125%, of the offered rates
for United States dollar deposits for one month that are quoted by the Reference
Banks as of 11:00 a.m., New York City time, on the related Interest
Determination Date to prime banks in the London interbank market for a period
of
one month in an amount approximately equal to the aggregate Certificate
Principal Balance of the Class A, Class M and Class B Certificates for such
Accrual Period, provided that at least two such Reference Banks provide such
rate. If fewer than two offered rates appear, the Reference Bank Rate will
be
the arithmetic mean, rounded upwards, if necessary, to the nearest whole
multiple of 0.03125%, of the rates quoted by one or more major banks in New
York
City, selected by the Securities Administrator, as of 11:00 a.m., New York
City
time, on such date for loans in United States dollars to leading European banks
for a period of one month in amounts approximately equal to the aggregate
Certificate Principal Balance of the Class A, Class M and Class B Certificates
for such Accrual Period.
Regular
Certificate:
Any
Certificate other than a Residual Certificate.
Regular
Interest:
A
“regular interest” in a REMIC within the meaning of Section 860G(a)(1) of the
Code.
Regulation
AB:
Subpart
229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
Relief
Act:
The
Servicemembers Civil Relief Act, as amended, or similar state law.
Relief
Act Interest Shortfall:
With
respect to any Distribution Date and any Mortgage Loan, any reduction in the
amount of interest collectible on such Mortgage Loan for the most recently
ended
Due Period as a result of the application of the Relief Act.
Remaining
Excess Spread:
With
respect to any Distribution Date, the Excess Spread less any Extra Principal
Distribution Amount, in each case for such Distribution Date.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of section 860D of the
Code.
REMIC
I:
The
segregated pool of assets described in the Preliminary Statement and Section
6.07(a).
REMIC
I Regular Interest:
Any of
the separate non-certificated beneficial ownership interests in REMIC I issued
hereunder and designated as a Regular Interest in REMIC I. Each REMIC I Regular
Interest shall accrue interest at the related Uncertificated REMIC I
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto. The designations for the respective
REMIC I Regular Interests are set forth in the Preliminary Statement hereto.
The
REMIC I Regular Interests consist of REMIC I Regular Interests I-1-A through
REMIC I Regular Interest I-45-B, each as designated in the Preliminary Statement
hereto.
REMIC
II:
The
segregated pool of assets described in the Preliminary Statement and Section
6.07(a).
REMIC
II Regular Interest:
Any of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. Each REMIC II
Regular Interest shall accrue interest at the related Uncertificated REMIC
II
Pass-Through Rate in effect from time to time, and (other than REMIC II Regular
Interest IO) shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto. The designations for the respective REMIC II Regular Interests are
set
forth in the Preliminary Statement hereto.
REMIC
II Interest Loss Allocation Amount:
With
respect to any Distribution Date, an amount (subject to adjustment based on
the
actual number of days elapsed in the respective Accrual Period) equal to (a)
the
product of (i) the aggregate Stated Principal Balance of the Mortgage Loans
and
the related REO Properties then outstanding and (ii) the Uncertificated REMIC
II
Pass-Through Rate for REMIC II Regular Interest AA minus the Marker Rate,
divided by (b) 12.
REMIC
II Overcollateralization Amount:
With
respect to any date of determination, (i) 1.00% of the aggregate Uncertificated
Principal Balance of the REMIC II Regular Interests (other than REMIC II Regular
Interest I-IO) minus (ii) the aggregate Uncertificated Principal Balance of
each
REMIC II Regular Interest for which a Class A, Class M or Class B Certificate
is
a Corresponding Certificate, in each case as of such date of
determination.
REMIC
II Principal Loss Allocation Amount:
With
respect to any Distribution Date, an amount equal to the product of (i) the
aggregate Stated Principal Balance of the Mortgage Loans and the related REO
Properties then outstanding and (ii) 1 minus a fraction, the numerator of which
is two (2) times the aggregate Uncertificated Principal Balance of each REMIC
II
Regular Interest for which a Class A, Class M or Class B Certificate is a
Corresponding Certificate and the denominator of which is the aggregate
Uncertificated Principal Balance of each REMIC II Regular Interest for which
a
Class A, Class M or Class B Certificate is a Corresponding Certificate and
REMIC
II Regular Interest ZZ.
REMIC
II Required Overcollateralization Amount:
1.00%
of the Overcollateralization Target Amount.
REMIC
III:
The
segregated pool of assets described in the Preliminary Statement and Section
6.07(a).
REMIC
III Regular Interest:
The
Class C Interest, Class IO Interest or any Regular Interest in REMIC III the
ownership of which is represented by any of the Class A, Class M and Class
B
Certificates.
REMIC
IV:
The
segregated pool of assets consisting of the Class C Interest conveyed in trust
to the Trustee, for the benefit of the Holders of the Class C Certificates
and
the Class RX Certificate (in respect of the Class R-4 Interest), with respect
to
which a separate REMIC election is to be made.
REMIC
V:
The
segregated pool of assets consisting of the Class IO Interest conveyed in trust
to the Trustee, for the benefit of the holders of REMIC V Regular Interest
IO
and the Class RX Certificate (in respect of the Class R-5 Interest), with
respect to which a separate REMIC election is to be made.
REMIC
Opinion:
Shall
mean an Opinion of Counsel to the effect that the proposed action will not
cause
any of REMIC I, REMIC II, REMIC III, REMIC IV or REMIC V to fail to qualify
as a
REMIC at any time that any Certificates are outstanding.
REMIC
Provisions:
Provisions of the federal income tax law relating to real estate mortgage
investment conduits, which appear at Sections 860A through 860G of the Code,
and
related provisions, and proposed, temporary and final regulations and published
rulings, notices and announcements promulgated thereunder, as the foregoing
may
be in effect from time to time, as well as provisions of applicable state
laws.
REMIC
Regular Interests:
The
REMIC I Regular Interests and REMIC II Regular Interests.
Remittance
Date:
Shall
mean (i) with respect to the Company, the Distribution Account Deposit Date
and
(ii) with respect to each Servicer, other than the Company, each Business Day
as
specified in the related Servicing Agreement.
Remittance
Report:
Shall
mean a report to the Securities Administrator in an electronic format (or by
such other means as the Master Servicer and the Securities Administrator may
agree from time to time) containing such data and information, as agreed to
by
the Master Servicer and the Securities Administrator such as to permit the
Securities Administrator to prepare the Monthly Statement to
Certificateholders.
REO
Imputed Interest:
As to
any REO Property, for any calendar month during which such REO Property was
at
any time part of REMIC I, one month’s interest at the applicable Net Mortgage
Rate on the Stated Principal Balance of such REO Property (or, in the case
of
the first such calendar month, of the related Mortgage Loan, if appropriate)
as
of the close of business on the Distribution Date in such calendar
month.
REO
Property:
A
Mortgaged Property acquired by the Company or the related Servicer on behalf
of
the Trust Fund through foreclosure or deed-in-lieu of foreclosure in connection
with a defaulted Mortgage Loan.
Replacement
Mortgage Loan:
A
Mortgage Loan or Mortgage Loans in the aggregate substituted by the Seller
for a
Deleted Mortgage Loan, which must, on the date of such substitution, as
confirmed in a Request for Release, (i) have a Stated Principal Balance, after
deduction of the principal portion of the Scheduled Payment due in the month
of
substitution, not in excess of, and not less than 90% of, the Stated Principal
Balance of the Deleted Mortgage Loan; (ii) if the Replacement Mortgage Loan
is a
fixed rate Mortgage Loan, have a fixed Mortgage Rate not less than or more
than
1% per annum higher than the Mortgage Rate of the Deleted Mortgage Loan; (iii)
have the same or higher credit quality characteristics than that of the Deleted
Mortgage Loan; (iv) have a Combined Loan-to-Value Ratio no higher than that
of
the Deleted Mortgage Loan; (v) have a remaining term to maturity no greater
than
(and not more than one year less than) that of the Deleted Mortgage Loan; (vi)
not permit conversion of the Mortgage Rate from a fixed rate to a variable
rate;
(vii) have the same lien priority as the Deleted Mortgage Loan; (viii)
constitute the same occupancy type as the Deleted Mortgage Loan or be owner
occupied; (ix) if the Replacement Mortgage Loan is an Adjustable Rate Mortgage
Loan, have a Maximum Mortgage Rate not less than the Maximum Mortgage Rate
on
the Deleted Mortgage Loan, (x) if the Replacement Mortgage Loan is an Adjustable
Rate Mortgage Loan, have a Minimum Mortgage Rate not less than the Minimum
Mortgage Rate of the Deleted Mortgage Loan, (xi) if the Replacement Mortgage
Loan is an Adjustable Rate Mortgage Loan, have a Gross Margin equal to or
greater than the Gross Margin of the Deleted Mortgage Loan, (xii) if the
Replacement Mortgage Loan is an Adjustable Rate Mortgage Loan, have a next
Adjustment Date not more than two months later than the next Adjustment Date
on
the Deleted Mortgage Loan, (xiii) comply with each representation and warranty
set forth in Section 7 of the Mortgage Loan Purchase Agreement and (xiv) the
Custodian has delivered a Final Certification noting no defects or
exceptions.
Reportable
Event:
The
meaning set forth in Section 3.18(a)(iii).
Repurchase
Price:
With
respect to each Mortgage Loan, a price equal to (i) the outstanding principal
balance of such Mortgage Loan, plus (ii) interest on such outstanding principal
balance at the Mortgage Rate (net of the Servicing Fee Rate) from the last
date
through which interest has been paid to the end of the month of repurchase,
less
(iii) amounts advanced by the Company, the Servicer or the Master Servicer
in
respect of such repurchased Mortgage Loan which are being held in the Master
Servicer Collection Account for remittance to the Securities Administrator
plus
(iv) any costs and damages (if any) incurred by the Trust in connection with
any
violation of such Mortgage Loan of any anti-predatory lending laws.
Request
for Release:
The
Request for Release to be submitted by the Seller, the Company, the Servicer
or
the Master Servicer to the respective Custodian substantially in the form of
Exhibit G hereto or other form attached as an exhibit to the related Custodial
Agreement. Each Request for Release furnished to the respective Custodian by
the
Seller, the Company, the Servicer or the Master Servicer shall be in duplicate
and shall be executed by an officer of such Person or a Servicing Officer (or,
if furnished electronically to the respective Custodian, shall be deemed to
have
been sent and executed by an officer of such Person or a Servicing Officer)
of
the Seller, the Company, the Servicer or the Master Servicer, as
applicable.
Required
Insurance Policy:
With
respect to any Mortgage Loan, any insurance policy that is required to be
maintained from time to time under this Agreement or the Servicing
Agreements.
Reserve
Fund:
Shall
mean the separate trust account created and maintained by the Securities
Administrator pursuant to Section 4.14 hereof.
Reserve
Fund Deposit:
With
respect to the Reserve Fund, an amount equal to $5,000, which the Depositor
shall initially deposit into the Reserve Fund pursuant to Section 4.14
hereof.
Residual
Certificates:
The
Class R-1, Class R-2, Class R-3 and Class RX Certificates (representing
ownership of the Class R-4 Interest and Class R-5 Interest), each evidencing
the
sole class of Residual Interests in the related REMIC.
Residual
Interest:
The
sole class of Residual Interests in a REMIC within the meaning of Section
860G(a)(2) of the Code.
Responsible
Officer:
With
respect to the Trustee and the Securities Administrator, any Vice President,
any
Assistant Vice President, the Secretary, any Assistant Secretary, or any Trust
Officer in its respective Corporate Trust Office with specific responsibility
for the transactions contemplated hereby, any other officer customarily
performing functions similar to those performed by any of the above designated
officers or other officers of the Trustee or the Securities Administrator as
specified by the Trustee or the Securities Administrator, respectively, as
to
whom, with respect to a particular matter, such matter is referred because
of
such officer’s knowledge of and familiarity with the particular
subject.
S&P:
Standard & Poor’s, a division of The XxXxxx-Xxxx Companies, Inc., and any
successor thereto.
Xxxxxxxx-Xxxxx
Act:
The
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations of the Commission
promulgated thereunder (including any interpretations thereof by the
Commission’s staff).
Xxxxxxxx-Xxxxx
Certification:
The
meaning set forth in Section 3.18(a)(iv).
Scheduled
Payment:
The
scheduled monthly payment on a Mortgage Loan due on any Due Date allocable
to
principal and/or interest on such Mortgage Loan.
Securities
Act:
The
Securities Act of 1933, as amended, and the rules and regulations
thereunder.
Securities
Administrator:
LaSalle
Bank National Association, in its capacity as securities administrator
hereunder, and its successors and assigns.
Securities
Act:
The
Securities Act of 1933, as amended, and the rules and regulations
thereunder.
Seller:
EMC in
its capacity as seller of the Mortgage Loans to the Depositor.
Senior
Certificates:
The
Class A Certificates.
Servicer:
Any of
EMC, First Horizon, HomeBanc and GMACM.
Servic(es)(ing):
In
accordance with Regulation AB, the act of servicing and administering the
Mortgage Loans or any other assets of the Trust by an entity that meets the
definition of “servicer’ set forth in Item 1101 of Regulation AB and is subject
to the disclosure requirements set forth in 1108 of Regulation AB. For
clarification purposes, any uncapitalized occurrence of this term shall have
the
meaning commonly understood by participants in the residential mortgage-backed
securitization market.
Servicing
Advances:
All
customary, reasonable and necessary “out of pocket” costs and expenses
(including reasonable legal fees) incurred in the performance by the Servicers
or the Company of their servicing obligations hereunder or under the related
Servicing Agreement, including, but not limited to, the cost of (i) the
preservation, restoration and protection of a Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, and including
any
expenses incurred in relation to any such proceedings that result from the
Mortgage Loan being registered in the MERS® System, (iii) the management and
liquidation of any REO Property (including, without limitation, realtor’s
commissions) and (iv) compliance with any obligations under Section 3.07 hereof
to cause insurance to be maintained.
Servicing
Agreement:
Any of
the First Horizon Servicing Agreement, the GMACM Servicing Agreement or the
HomeBanc Servicing Agreement.
Servicing
Criteria:
The
criteria set forth in paragraph (d) of Item 1122 of Regulation AB, as such
may
be amended from time to time.
Servicing
Fee:
As to
each EMC Mortgage Loan and any Distribution Date, an amount equal to
1/12th
of the
Servicing Fee Rate multiplied by the Stated Principal Balance of such EMC
Mortgage Loan payable solely from interest collections as of the Due Date in
the
month preceding the month in which such Distribution Date occurs. As to each
Mortgage Loan serviced by the Servicer and any Distribution Date, an amount
equal to 1/12th
of the
Servicing Fee multiplied by the unpaid principal balance of each such mortgage
loan payable solely from interest collections, as of the Due Date in the month
preceding the month in which such Distribution Date occurs.
Servicing
Fee Rate:
0.5000%
per annum.
Servicing
Modification:
With
respect to any Mortgage Loan that is in default or, in the reasonable judgment
of the related Servicer, as to which default is reasonably foreseeable, any
modification which is effected by the related Servicer in accordance with
the
terms of this Agreement or the related Servicing Agreement which results
in any
change in the outstanding Stated Principal Balance, any change in the Mortgage
Rate or any extension of the term of such Mortgage Loan.
Servicing
Officer:
Any
officer of the Company or the related Servicer involved in, or responsible
for,
the administration and servicing of the Mortgage Loans (i) in the case of
the
Company, whose name and facsimile signature appear on a list of servicing
officers furnished to the Master Servicer by the Company on the Closing Date
pursuant to this Agreement, as such list may from time to time be amended
and
(ii) in the case of the Servicer, as to which evidence reasonably acceptable
to
the Master Servicer, as applicable, of due authorization, by such party has
been
furnished from time to time to the Master Servicer.
Significance
Estimate:
With
respect to any Distribution Date, and in accordance with Item 1115 of Regulation
AB, shall be an amount determined based on the reasonable good-faith estimate
by
the Seller or its affiliate of the aggregate maximum probable exposure of the
outstanding Class A, Class M and Class B Certificates to the Swap Agreement.
Significance
Percentage:
With
respect to any Distribution Date, and in accordance with Item 1115 of Regulation
AB, shall be a percentage equal to the Significance Estimate divided by the
aggregate outstanding Certificate Principal Balance of the Class A, Class M
and
Class B Certificates, prior to the distribution of the Principal Distribution
Amount on such Distribution Date.
Sixty-Day
Plus Delinquency Percentage:
With
respect to any Distribution Date, is the arithmetic average for each of the
three successive Distribution Dates ending with the applicable Distribution
Date
of the percentage equivalent of a fraction, the numerator of which is the
aggregate Stated Principal Balance of the Mortgage Loans that are 60 or more
days delinquent in the payment of principal or interest for the relevant
Distribution Date, including any Mortgage Loans in foreclosure, REO and Mortgage
Loans with a related Mortgagor subject to bankruptcy proceedings, and the
denominator of which is the aggregate Stated Principal Balance of all of the
Mortgage Loans immediately preceding such Distribution Date.
Seller:
EMC.
Sponsor:
EMC
Mortgage Corporation, in its capacity as sponsor hereunder.
Startup
Day:
The
Startup Day for each REMIC formed hereunder shall be the Closing
Date.
Stated
Principal Balance:
With
respect to any Mortgage Loan or related REO Property and any Distribution Date,
the Cut-off Date Principal Balance thereof minus the sum of (i) the principal
portion of the Scheduled Payments due with respect to such Mortgage Loan during
each Due Period ending prior to such Distribution Date (and irrespective of
any
delinquency in their payment), (ii) all Principal Prepayments with respect
to
such Mortgage Loan received prior to or during the related Prepayment Period,
and all Liquidation Proceeds to the extent applied by the Company or the related
Servicer as recoveries of principal in accordance with Section 3.12 or the
related Servicing Agreement with respect to such Mortgage Loan, that were
received by the Company or the related Servicer as of the close of business
on
the last day of the calendar month immediately preceding such Distribution
Date
and (iii) any Realized Losses on such Mortgage Loan incurred during the related
Due Period. The Stated Principal Balance of a Liquidated Loan equals
zero.
Stepdown
Date:
The
earlier to occur of, (I) the first Distribution Date following the Distribution
Date for which the Certificate Principal Balance for each of the Class A
Certificates has been reduced to zero, and (II) the later to occur of (a)
the
Distribution Date in September 2009 or (b) the first Distribution Date on
which the Current Specified Enhancement Percentage is greater than or equal
to
48.10%.
Subordinated
Certificates:
The
Class M, Class B, Class C and Residual Certificates.
Subsequent
Recoveries:
As of
any Distribution Date, amounts received by the Master Servicer (net of any
related expenses permitted to be reimbursed pursuant to Section 5.02) or surplus
amounts held by the Master Servicer, Company and the related Servicer to cover
estimated expenses (including, but not limited to, recoveries in respect of
the
representations and warranties made by EMC pursuant to the Mortgage Loan
Purchase Agreement) specifically related to a Mortgage Loan that was the subject
of a liquidation or final disposition of any REO Property prior to the related
Prepayment Period that resulted in a Realized Loss.
Subservicing
Agreement:
Any
agreement entered into between the Company and a subservicer with respect to
the
subservicing of any Mortgage Loan hereunder by such subservicer.
Substitution
Adjustment Amount:
The
meaning ascribed to such term pursuant to Section 2.03(d).
Successor
Master Servicer:
The
meaning ascribed to such term pursuant to Section 8.06.
Supplemental
Interest Trust:
The
corpus of a trust created pursuant to Section 4.14 of this Agreement and
designated as the “Supplemental Interest Trust,” consisting of the Swap
Agreement, the Swap Administration Agreement, the Swap Account and REMIC V
Regular Interest IO. For the avoidance of doubt, the Supplemental Interest
Trust, the Swap Agreement, the Swap Account and the Swap Administration
Agreement do not constitute parts of the Trust Fund or any REMIC.
Supplemental
Interest Trust Trustee:
LaSalle
not in its individual capacity but solely in its capacity as Supplemental
Interest Trust Trustee and any successor thereto, and any corporation or
national banking association resulting from or surviving any consolidation
or
merger to which it or its successors may be a party and any successor
Supplemental Interest Trust Trustee as may from time to time be serving as
successor Supplemental Interest Trust Trustee.
Swap
Account:
The
separate trust account created and maintained by the Swap Administrator, and
held within the Supplemental Interest Trust, pursuant to the Swap Administration
Agreement.
Swap
Administrator:
LaSalle
acting as swap administrator under the Swap Administration
Agreement.
Swap
Administration Agreement:
The
Swap Administration Agreement, dated August 30, 2006, pursuant to which the
Swap
Administrator will make payments to the Swap Provider and the Class A, Class
M
and Class B Certificateholders, and certain other payments, as such agreement
may be amended or supplemented from time to time.
Swap
Agreement:
The
interest rate swap agreement between the Swap Provider and Supplemental Interest
Trust Trustee, acting as trustee on behalf of the Supplemental Interest Trust,
together with any schedules, confirmations or other agreements relating thereto,
attached hereto as Exhibit N.
Swap
LIBOR:
For any
Distribution Date, a per annum rate equal to the Floating Rate Option (as
defined in the Swap Agreement) for the related Calculation Period (as defined
in
the Swap Agreement).
Swap
Optional Termination Payment:
As
defined in Section 11.01.
Swap
Provider:
The
swap provider under the Swap Agreement either (a) entitled to receive payments
from the Swap Administrator from amounts payable by the Trust Fund under this
Agreement or (b) required to make payments to the Swap Administrator
distribution as provided xxxxx, in either case pursuant to the terms of the
Swap
Agreement, and any successor in interest or assign. Initially, the Swap Provider
shall be Wachovia Bank, N.A.
Swap
Provider Trigger Event:
With
respect to any Distribution Date, (i) an Event of Default under the Swap
Agreement with respect to which the Swap Provider is a Defaulting Party, (ii)
a
Termination Event under the Swap Agreement with respect to which the Swap
Provider is the sole Affected Party, or (iii) an Additional Termination Event
under the Swap Agreement with respect to which the Swap Provider is the sole
Affected Party.
Swap
Termination Payment:
Upon
the designation of an “Early Termination Date” as defined in the Swap Agreement,
the payment to be made by the Swap Administrator to the Swap Provider from
payments from the Trust Fund, or by the Swap Provider to the Swap Administrator
for payment to the Trust Fund, as applicable, pursuant to the terms of the
Swap
Agreement.
Tax
Matters Person:
The
person designated as “tax matters person” in the manner provided under Treasury
Regulation Sections 1.860F-4(d) and 301.6231(a)(7)-1T. The holder of the
greatest Percentage Interest in a Class of Residual Certificates shall be the
Tax Matters Person for the related REMIC. The Securities Administrator, or
any
successor thereto or assignee thereof, shall serve as tax administrator
hereunder and as agent for the related Tax Matters Person.
Transfer:
Any
direct or indirect transfer or sale of any Ownership Interest in a
Certificate.
Transfer
Affidavit:
As
defined in Section 7.02(c)(ii).
Trigger
Event:
With
respect to any Distribution Date, a “ Trigger Event” shall have occurred if any
of the following tests is not satisfied: (i) the Sixty-Day Plus Delinquency
Percentage is less than 16.63% of the Current Specified Enhancement Percentage,
or (ii) (A) for any Distribution Date from and including the Distribution Date
in September 2008 to and including the Distribution Date in August 2009, the
Cumulative Realized Loss Percentage for such Distribution Date is less than
2.10% plus an additional 1/12th of 2.40% for each Distribution Date thereafter
up to and including the Distribution Date in August 2009, (B) for any
Distribution Date from and including the Distribution Date in September 2009
to
and including the Distribution Date in August 2010, the Cumulative Realized
Loss
Percentage for such Distribution Date is less than 4.50% plus an additional
1/12th of 1.75% for each Distribution Date thereafter up to and including the
Distribution Date in August 2010, (C) for any Distribution Date from and
including the Distribution Date in September 2010 to and including the
Distribution Date in August 2011, the Cumulative Realized Loss Percentage for
such Distribution Date is less than 6.25% plus an additional 1/12th of 1.25%
for
each Distribution Date thereafter up to and including the Distribution Date
in
August 2011, (D) for any Distribution Date from and including the Distribution
Date in September 2011 to and including the Distribution Date in August 2012,
the Cumulative Realized Loss Percentage for such Distribution Date is less
than
7.50% plus an additional 1/12th of 0.25% for each Distribution Date thereafter
up to and including the Distribution Date in August 2012, and (E) for any
Distribution Date thereafter, the Cumulative Realized Loss Percentage for such
Distribution Date is less than 7.75%.
Trust:
As
defined in Section 2.07.
Trust
Fund:
The
corpus of the trust created hereunder consisting of (i) the Mortgage Loans
and
all interest accruing and principal due with respect thereto after the Cut-off
Date to the extent not applied in computing the Cut-off Date Principal Balance
thereof; (ii) the Distribution Account, the Reserve Fund, the Master Servicer
Collection Account maintained by the Master Servicer and the Protected Accounts
maintained by the Company and the related Servicers and all amounts deposited
therein pursuant to the applicable provisions of this Agreement and the
Servicing Agreements; (iii) property that secured a Mortgage Loan and has been
acquired by foreclosure, deed in lieu of foreclosure or otherwise; (iv) the
mortgagee’s rights under the Insurance Policies with respect to the Mortgage
Loans; (v) the Servicing Agreements and the Assignment Agreements; (vii) the
rights under the Swap Administration Agreement; (viii) the rights under the
Mortgage Loan Purchase Agreement; and (ix) all proceeds of the foregoing,
including proceeds of conversion, voluntary or involuntary, of any of the
foregoing into cash or other liquid property. The Reserve Fund shall constitute
an asset of the Trust Fund but will not be included in REMIC I, REMIC II, REMIC
III, REMIC IV or REMIC V.
Trustee:
Citibank, N.A., a national banking association, as trustee for the benefit
of
the Certificateholders under this Agreement, and any successor thereto, and
any
corporation or national banking association resulting from or surviving any
consolidation or merger to which it or its successors may be a party and any
successor trustee as may from time to time be serving as successor trustee
hereunder.
Uncertificated
Accrued Interest:
With
respect to each REMIC Regular Interest on each Distribution Date, an amount
equal to one month’s interest at the related Uncertificated Pass-Through Rate on
the related Uncertificated Principal Balance or related Uncertificated Notional
Amount of such REMIC Regular Interest. In each case, Uncertificated Accrued
Interest will be reduced by any Prepayment Interest Shortfalls and Relief Act
Interest Shortfalls (allocated to such REMIC Regular Interests as set forth
in
Section 1.02).
Uncertificated
Notional Amount:
With
respect to the Class C Interest and any Distribution Date, an amount equal
to
the aggregate Uncertificated Principal Balance of the REMIC II Regular Interests
(other than REMIC II Regular Interest IO) for such Distribution
Date.
With
respect to REMIC II Regular Interest IO and each Distribution Date listed below,
the aggregate Uncertificated Principal Balance of the REMIC I Regular Interests
ending with the designation “A” listed below:
|
Distribution
Date
|
REMIC
I Regular Interests
|
|
1
|
I-1-A
through X-00-X
|
|
0
|
X-0-X
xxxxxxx X-00-X
|
|
0
|
X-0-X
through I-45-A
|
|
4
|
I-4-A
through X-00-X
|
|
0
|
X-0-X
xxxxxxx X-00-X
|
|
0
|
X-0-X
through I-45-A
|
|
7
|
I-7-A
through X-00-X
|
|
0
|
X-0-X
xxxxxxx X-00-X
|
|
0
|
X-0-X
through I-45-A
|
|
10
|
I-10-A
through I-45-A
|
|
11
|
I-11-A
through I-45-A
|
|
12
|
I-12-A
through I-45-A
|
|
13
|
I-13-A
through I-45-A
|
|
14
|
I-14-A
through I-45-A
|
|
15
|
I-15-A
through I-45-A
|
|
16
|
I-16-A
through I-45-A
|
|
17
|
I-17-A
through I-45-A
|
|
18
|
I-18-A
through I-45-A
|
|
19
|
I-19-A
through I-45-A
|
|
20
|
I-20-A
through I-45-A
|
|
21
|
I-21-A
through I-45-A
|
|
22
|
I-22-A
through I-45-A
|
|
23
|
I-23-A
through I-45-A
|
|
24
|
I-24-A
through I-45-A
|
|
25
|
I-25-A
through I-45-A
|
|
26
|
I-26-A
through I-45-A
|
|
27
|
I-27-A
through I-45-A
|
|
28
|
I-28-A
through I-45-A
|
|
29
|
I-29-A
through I-45-A
|
|
30
|
I-30-A
through I-45-A
|
|
31
|
I-31-A
through I-45-A
|
|
32
|
I-32-A
through I-45-A
|
|
33
|
I-33-A
through I-45-A
|
|
34
|
I-34-A
through I-45-A
|
|
35
|
I-35-A
through I-45-A
|
|
36
|
I-36-A
through I-45-A
|
|
37
|
I-37-A
through I-45-A
|
|
38
|
I-38-A
through I-45-A
|
|
39
|
I-39-A
through I-45-A
|
|
40
|
I-40-A
through I-45-A
|
|
41
|
I-41-A
through I-45-A
|
|
42
|
I-42-A
through I-45-A
|
|
43
|
I-43-A
through I-45-A
|
|
44
|
I-44-A
through I-45-A
|
|
45
|
I-45-A
|
|
thereafter
|
$0.00
|
With
respect to the Class IO Interest and any Distribution Date, an amount equal
to
the Uncertificated Notional Amount of the REMIC II Regular Interest IO. With
respect to REMIC V Regular Interest IO, an amount equal to the Uncertificated
Notional Amount of the Class IO Interest.
Uncertificated
Pass-Through Rate:
The
Uncertificated REMIC I Pass-Through Rate or Uncertificated REMIC II Pass-Through
Rate.
Uncertificated
Principal Balance:
The
amount of REMIC Regular Interests and Class C Interest outstanding as of any
date of determination. As of the Closing Date, the Uncertificated Principal
Balance of each REMIC Regular Interest and Class C Interest shall equal the
amount set forth in the Preliminary Statement hereto as its initial
uncertificated principal balance. On each Distribution Date, the Uncertificated
Principal Balance of the REMIC Regular Interests shall be reduced by all
distributions of principal made on such REMIC Regular Interests on such
Distribution Date pursuant to Section 6.07 and, if and to the extent necessary
and appropriate, shall be further reduced on such Distribution Date by Realized
Losses as provided in Section 6.05, and the Uncertificated Principal Balance
of
REMIC II Regular Interest ZZ shall be increased by interest deferrals as
provided in Section 6.07(c)(1)(ii). The Uncertificated Principal Balance of
each
REMIC Regular Interest and Class C Interest shall never be less than zero.
With
respect to the Class C Interest as of any date of determination, an amount
equal
to the excess, if any, of (A) the then aggregate Uncertificated Principal
Balance of the REMIC II Regular Interests over (B) the then aggregate
Certificate Principal Balance of the Class A, Class M and Class B Certificates
then outstanding.
Uncertificated
REMIC I Pass-Through Rate:
With
respect to each REMIC I Regular Interest ending with the designation “A” and any
Distribution Date, a per annum rate equal to the weighted average Net Mortgage
Rate of the Mortgage Loans multiplied by 2, subject to a maximum rate of
10.530%. With respect to each REMIC I Regular Interest ending with the
designation “B” and any Distribution Date, the greater of (x) a per annum rate
equal to the excess, if any, of (1) 2 multiplied by the weighted average Net
Mortgage Rate of the Mortgage Loans over (2) 10.530%, and (y) 0.00% per annum.
Uncertificated
REMIC II Pass-Through Rate:
With
respect to REMIC II Regular Interest AA, each REMIC II Regular Interest for
which a Class A, Class M or Class B Certificate is the Corresponding Certificate
and REMIC II Regular Interest ZZ, and any Distribution Date, a per annum rate
equal to the weighted average of (x) the Uncertificated REMIC I Pass-Through
Rates for the REMIC I Regular Interests ending with the designation “B” for such
Distribution Date and (y) the rates listed below for the REMIC I Regular
Interests ending with the designation “A” for such Distribution Date, in each
case weighted on the basis of the Uncertificated Principal Balances of each
such
REMIC I Regular Interest for such Distribution Date:
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
|
1
|
I-1-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
2
|
I-2-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
3
|
I-3-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-2-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
4
|
I-4-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-3-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
5
|
I-5-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-4-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
6
|
I-6-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-5-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
7
|
I-7-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-6-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
8
|
I-8-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-7-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
9
|
I-9-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-8-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
10
|
I-10-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-9-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
11
|
I-11-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-10-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
12
|
I-12-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-11-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
13
|
I-13-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-12-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
14
|
I-14-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-13-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
15
|
I-15-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-14-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
16
|
I-16-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-15-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
17
|
I-17-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-16-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
18
|
I-18-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-17-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
19
|
I-19-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-18-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
20
|
I-20-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-19-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
21
|
I-21-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-20-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
22
|
I-22-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-21-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
23
|
I-23-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-22-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
24
|
I-24-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-23-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
25
|
I-25-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-24-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
26
|
I-26-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-25-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
27
|
I-27-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-26-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
28
|
I-28-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-27-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
29
|
I-29-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-28-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
30
|
I-30-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-29-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
31
|
I-31-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-30-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
32
|
I-32-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-31-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
33
|
I-33-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-32-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
34
|
I-34-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-33-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
35
|
I-35-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-34-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
36
|
I-36-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-35-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
37
|
I-37-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-36-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
38
|
I-38-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-37-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
39
|
I-39-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-38-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
40
|
I-40-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-39-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
41
|
I-41-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-40-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
42
|
I-42-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-41-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
43
|
I-43-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-42-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
44
|
I-44-A
through I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-43-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
45
|
I-45-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-44-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
thereafter
|
I-1-A
through I-45-A
|
Uncertificated
REMIC I Pass-Through Rate
|
With
respect to REMIC II Regular Interest IO and any Distribution Date, a per annum
rate equal to the excess, if any, of (x) the weighted average of the
Uncertificated REMIC I Pass-Through Rates for the REMIC I Regular Interests
ending with the designation “A” for such Distribution Date, over (y) 2
multiplied by Swap LIBOR.
Unpaid
Realized Loss Amount:
With
respect to the Class A Certificates and as to any Distribution Date is the
excess of Applied Realized Loss Amounts with respect to such Class over the
sum
of all distributions in reduction of the Applied Realized Loss Amounts on all
previous Distribution Dates. Any amounts distributed to the Class A Certificates
in respect of any Unpaid Realized Loss Amount shall not be applied to reduce
the
Certificate Principal Balance of such Class.
Voting
Rights:
The
portion of the voting rights of all the Certificates that is allocated to any
Certificate for purposes of the voting provisions hereunder. Voting Rights
shall
be allocated (i) 93% to the Class A, Class M and Class B Certificates, (ii)
3%
to the Class C Certificates until paid in full, (iii) 1% to each of the Class
R-1, Class R-2, Class R-3 Certificates and Class RX Certificates, with the
allocation among the Certificates (other than the Class C Certificates and
Residual Certificates) to be in proportion to the Certificate Principal Balance
of each Class relative to the Certificate Principal Balance of all other such
Classes. Voting Rights will be allocated among the Certificates of each such
Class in accordance with their respective Percentage Interests.
Xxxxx
Fargo:
Xxxxx
Fargo Bank, National Association, and any successor in interest.
Xxxxx
Fargo Custodial Agreement:
The
Custodial Agreement, dated as of August 30, 2006, among the Depositor, EMC,
as
Seller, the Master Servicer, the Securities Administrator, the Trustee and
Xxxxx
Fargo Bank, National Association as Custodian relating to the Mortgage Loans
identified in such Custodial Agreement.
Section
1.02 Allocation
of Certain Interest Shortfalls.
For
purposes of calculating the amount of Current Interest for the Class A, Class
M,
Class B and Class C Certificates for any Distribution Date, the aggregate amount
of any Prepayment Interest Shortfalls (to the extent not covered by payments
by
the Company or the Master Servicer pursuant to Section 6.02) and any Relief
Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated first, to the Class C Interest based on,
and to the extent of, one month’s interest at the then applicable Pass-Through
Rate on the Uncertificated Notional Amount thereof, and to the Class R-3
Certificates based on the amounts otherwise distributable thereto, and,
thereafter, among the Class A, Class M and Class B Certificates, in each case
on
a pro
rata
basis
based on, and to the extent of, one month’s interest at the then applicable
respective Pass-Through Rates on the respective Certificate Principal Balances
of each such Certificate.
For
purposes of calculating the amount of Uncertificated Accrued Interest for the
REMIC I Regular Interests for any Distribution Date, the aggregate amount of
any
Prepayment Interest Shortfalls (to the extent not covered by payments by the
Company or the Master Servicer pursuant to Section 6.02) and any Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated first, to the Class R-1 Certificates based
on the amounts otherwise distributable thereto, second, to REMIC I Regular
Interests ending with the designation “B, pro
rata,
based
on, and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC I Pass-Through Rates on the respective Uncertificated
Principal Balances of each such REMIC I Regular Interest, and third, to REMIC
I
Regular Interests ending with the designation “A”, pro
rata,
based
on, and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC I Pass-Through Rates on the respective Uncertificated
Principal Balances of each such REMIC I Regular Interest.
For
purposes of calculating the amount of Uncertificated Accrued Interest for the
REMIC II Regular Interests for any Distribution Date, the aggregate amount
of
any Prepayment Interest Shortfalls (to the extent not covered by payments by
the
Company or the Master Servicer pursuant to Section 6.02) and any Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated first, to Uncertificated Accrued Interest
payable to REMIC II Regular Interest AA and REMIC II Regular Interest ZZ up
to
an aggregate amount equal to the REMIC II Interest Loss Allocation Amount,
98%
and 2%, respectively, and to the amounts otherwise distributable to the Class
R-2 Certificates, and thereafter among REMIC II Regular Interest AA, each REMIC
II Regular Interest for which a Class A, Class M or Class B Certificate is
the
Corresponding Certificate and REMIC II Regular Interest ZZ, pro
rata,
based
on, and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC II Pass-Through Rates on the respective Uncertificated
Principal Balances of each such REMIC II Regular Interest.
ARTICLE
II
CONVEYANCE
OF TRUST FUND
REPRESENTATIONS
AND WARRANTIES
Section
2.01 Conveyance
of Trust Fund.
Pursuant
to the Mortgage Loan Purchase Agreement, each Seller sold, transferred,
assigned, set over and otherwise conveyed to the Depositor, without recourse,
all the right, title and interest of such Seller in and to the assets sold
by it
in the Trust Fund.
EMC
has
entered into this Agreement in consideration for the purchase of the Mortgage
Loans by the Depositor pursuant to the Mortgage Loan Purchase Agreement and
has
agreed to take the actions specified herein.
The
Depositor, concurrently with the execution and delivery hereof, hereby sells,
transfers, assigns, sets over and otherwise conveys to the Trustee for the
use
and benefit of the Certificateholders, without recourse, all the right, title
and interest of the Depositor in and to the Trust Fund.
In
connection with such sale, the Depositor has delivered to, and deposited
with,
the Trustee or the related Custodian, as its agent, the following documents
or
instruments with respect to each Mortgage Loan so assigned: (i) the original
Mortgage Note, including any riders thereto, endorsed without recourse (A)
in
blank or to order of “Citibank, N.A., as Trustee for Certificateholders of SACO
I Trust 2006-9, Mortgage-Backed Certificates, Series 2006-9,” or (B) in the case
of a loan registered on the MERS system, in blank and showing an unbroken
chain
of endorsements from the original payee thereof to the Person endorsing it
to
the Trustee, (ii) the original Mortgage and, if the related Mortgage Loan
is a
MOM Loan, noting the presence of the MIN and language indicating that such
Mortgage Loan is a MOM Loan, which shall have been recorded (or, for Mortgage
Loans other than the EMC Flow Loans, if the original is not available, a
copy),
with evidence of such recording indicated thereon (or if clause (x) in the
proviso below applies, shall be in recordable form), (iii) unless the Mortgage
Loan is either a MOM Loan or has been assigned in the name of MERS®, the
assignment (either an original or a copy, which may be in the form of a blanket
assignment if permitted in the jurisdiction in which the Mortgaged Property
is
located) to the Trustee of the Mortgage with respect to each Mortgage Loan
in
the name of “Citibank, N.A., as Trustee for Certificateholders of SACO I Trust
2006-9, Mortgage-Backed Certificates, Series 2006-9,” which shall have been
recorded (or if clause (x) in the proviso below applies, shall be in recordable
form), (iv) an original or a copy of all intervening assignments of the
Mortgage, if any, with evidence of recording thereon, (v) with respect to
any
Mortgage Loan (other than any Piggyback Loan), the original policy of title
insurance or
mortgagee’s certificate of title insurance or commitment or binder for title
insurance or,
in
the event such original title policy has not been received from the title
insurer, such title policy will be delivered within one year of the Closing
Date
or, in the event such original title policy is unavailable, a photocopy of
such
title policy or, in lieu thereof, a current lien search on the related Mortgaged
Property; and with respect to any Piggyback Loan, the original policy of
title insurance or mortgagee’s certificate of title insurance or commitment or
binder for title insurance issued as to the related first lien Mortgage Loan
or, in lieu thereof, a lien search on the related Mortgaged Property that
was conducted in connection with the related first lien Mortgage Loan and
(vi)
originals or copies of all available assumption, modification or substitution
agreements, if any; provided, however, that in lieu of the foregoing, the
related Seller may deliver the following documents, under the circumstances
set
forth below: (x) if any Mortgage (other than the Mortgages related to the
EMC
Flow Loans), assignment thereof to the Trustee or intervening assignments
thereof have been delivered or are being delivered to recording offices for
recording and have not been returned in time to permit their delivery as
specified above, the Depositor may deliver a true copy thereof with a
certification by such Seller or the title company issuing the commitment
for
title insurance, on the face of such copy, substantially as follows: “Certified
to be a true and correct copy of the original, which has been transmitted
for
recording”; and (y) in lieu of the Mortgage Notes relating to the Mortgage Loans
identified in the list set forth in Exhibit I, the Depositor may deliver
a lost
note affidavit and indemnity and a copy of the original note, if available;
and
provided, further, however, that in the case of Mortgage Loans which have
been
prepaid in full after the Cut-off Date and prior to the Closing Date, the
Depositor, in lieu of delivering the above documents, may deliver to the
Trustee
and the related Custodian a certification of a Servicing Officer to such
effect
and in such case shall deposit all amounts paid in respect of such Mortgage
Loans, in the Master Servicer Collection Account or in the Distribution Account
on the Closing Date. In the case of the documents referred to in clause (x)
above, the Depositor shall deliver such documents to the Trustee or the related
Custodian promptly after they are received. EMC shall cause, at its expense,
the
Mortgage and intervening assignments, if any, and to the extent required
in
accordance with the foregoing, the assignment of the Mortgage to the Trustee
to
be submitted for recording promptly after the Closing Date; provided that
EMC
need not cause to be recorded (a) any assignment in any jurisdiction under
the
laws of which, as evidenced by an Opinion of Counsel addressed to the Trustee
delivered by EMC to the Trustee, the Custodians and each Rating Agency, the
recordation of such assignment is not necessary to protect the Trustee’s
interest in the related Mortgage Loan or (b) if MERS is identified on the
Mortgage or on a properly recorded assignment of the Mortgage as the mortgagee
of record solely as nominee for the related Seller and its successors and
assigns. In the event that either Seller, the Depositor or the Master Servicer
or the Securities Administrator gives written notice to the Trustee that
a court
has recharacterized the sale of the Mortgage Loans as a financing, EMC shall
submit or cause to be submitted for recording as specified above each such
previously unrecorded assignment to be submitted for recording as specified
above at the expense of the Trust. In the event a Mortgage File is released
to
the Company or the related Servicer as a result of such Person having completed
a Request for Release, the related Custodian shall, if not so completed,
complete the assignment of the related Mortgage in the manner specified in
clause (iii) above.
In
connection with the assignment of any Mortgage Loan registered on the MERS®
System, EMC further agrees that it will cause, at EMC’s own expense, within 30
days after the Closing Date, the MERS® System to indicate that such Mortgage
Loans have been assigned by EMC to the Depositor and by the Depositor to the
Trustee in accordance with this Agreement for the benefit of the
Certificateholders by including (or deleting, in the case of Mortgage Loans
which are repurchased in accordance with this Agreement) in such computer files
(a) the code in the field which identifies the specific Trustee and (b) the
code
in the field “Pool Field” which identifies the series of the Certificates issued
in connection with such Mortgage Loans. EMC further agrees that it will not,
and
will not permit the Company or the Master Servicer to, and the Master Servicer
agrees that it will not, alter the codes referenced in this paragraph with
respect to any Mortgage Loan during the term of this Agreement unless and until
such Mortgage Loan is repurchased in accordance with the terms of this Agreement
or the Mortgage Loan Purchase Agreement.
All
original documents relating to the Mortgage Loans that are not delivered to
the
Trustee or the related Custodian on its behalf are and shall be held by or
on
behalf of the Seller or the Depositor, as the case may be, in trust for the
benefit of the Trustee on behalf of the Certificateholders. Any such original
document delivered to or held by the Depositor, shall be delivered promptly
to
the Custodian on the Trustee’s behalf.
Whenever
it is provided for in this Agreement that any document, evidence or information
relating to a Mortgage Loan to be included in a Mortgage File be delivered
or
supplied to the Trustee, such delivery or supply shall be made to the
appropriate Custodian pursuant to the related Custodial Agreement.
Section
2.02 Acceptance
of the Mortgage Loans.
(a) Based
on
the Initial Certification received by it from the related Custodian, the Trustee
acknowledges receipt of, subject to the further review and exceptions reported
by the related Custodian pursuant to the procedures described below, the
documents (or certified copies thereof) delivered to the Trustee or the related
Custodian on its behalf pursuant to Section 2.01 and declares that it holds
and
will continue to hold directly or through a custodian those documents and any
amendments, replacements or supplements thereto and all other assets of the
Trust Fund delivered to it in trust for the use and benefit of all present
and
future Holders of the Certificates. On the Closing Date, the Trustee or the
related Custodian on its behalf will deliver one or more Initial Certifications,
each in the form of Exhibit One to the Custodial Agreement, to the parties
indicated on such exhibit confirming whether or not it has received the Mortgage
File for each Mortgage Loan, but without review of such Mortgage File, except
to
the extent necessary to confirm whether such Mortgage File contains the original
Mortgage Note or a lost note affidavit and indemnity in lieu thereof. No later
than 90 days after the Closing Date, Trustee or the related Custodian on its
behalf shall, for the benefit of the Certificateholders, review each Mortgage
File delivered to it and execute and deliver to EMC, and the Master Servicer
and, if reviewed by the related Custodian, to the Trustee, one or more Interim
Certifications, each substantially in the form of Exhibit Two to the related
Custodial Agreement. In conducting such review, the Trustee or the related
Custodian on its behalf will ascertain whether all required documents have
been
executed and received and whether those documents relate, determined on the
basis of the Mortgagor name, original principal balance and loan number, to
the
Mortgage Loans identified in Exhibit B to this Agreement, as supplemented
(provided, however, that with respect to those documents described in subclauses
(iv) and (vi) of Section 2.01, such obligations shall extend only to documents
actually delivered pursuant to such subclauses). In performing any such review,
the Trustee and the related Custodian may conclusively rely on the purported
due
execution and genuineness of any such document and on the purported genuineness
of any signature thereon. If the Trustee or the related Custodian on its behalf
finds any document constituting part of the Mortgage File not to have been
executed or received, or to be unrelated to the Mortgage Loans identified in
Exhibit B or to appear to be defective on its face, the Trustee or the related
Custodian on its behalf shall include such information in the exception report
attached to the Interim Certification. EMC shall correct or cure any such defect
or, if prior to the end of the second anniversary of the Closing Date, EMC
may
substitute for the related Mortgage Loan a Replacement Mortgage Loan, which
substitution shall be accomplished in the manner and subject to the conditions
set forth in Section 2.03 or shall deliver to the Securities Administrator
and
the Trustee an Opinion of Counsel addressed to the Trustee to the effect that
such defect does not materially or adversely affect the interests of the
Certificateholders in such Mortgage Loan within 60 days from the date of notice
from the Trustee of the defect and if EMC fails to correct or cure the defect
or
deliver such opinion within such period, EMC will, subject to Section 2.03,
within 90 days from the notification of the Trustee purchase such Mortgage
Loan
at the Purchase Price; provided, however, that if such defect relates solely
to
the inability of EMC to deliver the Mortgage, assignment thereof to the Trustee,
or intervening assignments thereof with evidence of recording thereon because
such documents have been submitted for recording and have not been returned
by
the applicable jurisdiction, EMC shall not be required to purchase such Mortgage
Loan if EMC delivers such documents promptly upon receipt, but in no event
later
than 360 days after the Closing Date.
(b) No
later
than 180 days after the Closing Date, the Trustee or the related Custodian
on
its behalf will review, for the benefit of the Certificateholders, the Mortgage
Files and will execute and deliver or cause to be executed and delivered to
EMC,
and the Master Servicer and, if reviewed by the related Custodian, to the
Trustee, one or more Final Certifications, each substantially in the form of
Exhibit Three to the related Custodial Agreement. In conducting such review,
the
Trustee or the related Custodian on its behalf will ascertain whether each
document required to be recorded has been returned from the recording office
with evidence of recording thereon and the Trustee or the related Custodian
on
its behalf has received either an original or a copy thereof, as required in
Section 2.01 (provided, however, that with respect to those documents described
in subclauses (iv) and (vi) of Section 2.01, such obligations shall extend
only
to documents actually delivered pursuant to such subclauses). If the Trustee
or
the related Custodian on its behalf finds any document with respect to a
Mortgage Loan has not been received, or to be unrelated, determined on the
basis
of the Mortgagor name, original principal balance and loan number, to the
Mortgage Loans identified in Exhibit B or to appear defective on its face,
the
Trustee or the related Custodian on its behalf shall note such defect in the
exception report attached to the Final Certification and shall promptly notify
EMC. EMC shall correct or cure any such defect or, if prior to the end of the
second anniversary of the Closing Date, EMC may substitute for the related
Mortgage Loan a Replacement Mortgage Loan, which substitution shall be
accomplished in the manner and subject to the conditions set forth in Section
2.03 or shall deliver to the Trustee and the Securities Administrator an Opinion
of Counsel addressed to the Trustee and the Securities Administrator to the
effect that such defect does not materially or adversely affect the interests
of
Certificateholders in such Mortgage Loan within 60 days from the date of notice
from the Trustee of the defect and if EMC is unable within such period to
correct or cure such defect, or to substitute the related Mortgage Loan with
a
Replacement Mortgage Loan or to deliver such opinion, EMC shall, subject to
Section 2.03, within 90 days from the notification of the Trustee, purchase
such
Mortgage Loan at the Purchase Price; provided, however, that if such defect
relates solely to the inability of EMC to deliver the Mortgage, assignment
thereof to the Trustee or intervening assignments thereof with evidence of
recording thereon, because such documents have not been returned by the
applicable jurisdiction, EMC shall not be required to purchase such Mortgage
Loan, if EMC delivers such documents promptly upon receipt, but in no event
later than 360 days after the Closing Date. Notwithstanding anything to the
contrary, the Trustee shall have no responsibility with respect to the custody
or review of Mortgage Files, all of which shall be performed by the related
Custodian pursuant to the related Custodial Agreement, and the Trustee is hereby
authorized and directed to enter into each such Custodial Agreement. Performance
by the Custodians of their obligations under the respective Custodial Agreement
shall satisfy all responsibilities for custody and review of Mortgage Files
hereunder. The Trustee shall have no liability for the failure of the Custodians
to perform their respective obligations under the related Custodial
Agreement.
(c) In
the
event that a Mortgage Loan is repurchased by EMC in accordance with subsections
2.02(a) or (b) above or Section 2.03, EMC shall remit the applicable Purchase
Price to the Master Servicer for deposit in the Master Servicer Collection
Account and shall provide written notice to the Securities Administrator and
the
Trustee detailing the components of the Purchase Price, signed by a Servicing
Officer. Upon deposit of the Purchase Price in the Master Servicer Collection
Account and upon receipt of a Request for Release with respect to such Mortgage
Loan, the related Custodian will release to EMC the related Mortgage File and
the Trustee shall execute and deliver all instruments of transfer or assignment,
without recourse, representation or warranty furnished to it by the related
Seller, as are necessary to vest in EMC title to and rights under the Mortgage
Loan. Such purchase shall be deemed to have occurred on the date on which the
deposit into the Master Servicer Collection Account was made. The Securities
Administrator shall promptly use its best efforts to notify each Rating Agency
of such repurchase in accordance with Section 12.05. The obligation of EMC
to
cure, repurchase or substitute for any Mortgage Loan as to which a defect in
a
constituent document exists shall be the sole remedies respecting such defect
available to the Certificateholders or to the Trustee on their
behalf.
(d) EMC
shall
deliver to the Trustee or the related Custodian on its behalf, and Trustee
agrees to accept the Mortgage Note and other documents constituting the Mortgage
File with respect to any Replacement Mortgage Loan, which the Trustee or the
related Custodian will review as provided in subsections 2.02(a) and 2.02(b),
provided, that the Closing Date referred to therein shall instead be the date
of
delivery of the Mortgage File with respect to each Replacement Mortgage
Loan.
Section
2.03 Representations,
Warranties and Covenants of the Company, the Master Servicer, and EMC as
Seller.
(a) The
Company hereby represents and warrants to the Master Servicer, the Depositor,
the Securities Administrator and the Trustee as follows, as of the Closing
Date:
(i) It
is
duly organized and is validly existing and in good standing under the laws
of
the State of Delaware and is duly authorized and qualified to transact any
and
all business contemplated by this Agreement to be conducted by it in any state
in which a Mortgaged Property related to an EMC Mortgage Loan is located or
is
otherwise not required under applicable law to effect such qualification and,
in
any event, is in compliance with the doing business laws of any such state,
to
the extent necessary to ensure its ability to enforce each EMC Mortgage Loan,
to
service the EMC Mortgage Loans in accordance with the terms of the Mortgage
Loan
Purchase Agreement and this Agreement and to perform any of its other
obligations under this Agreement in accordance with the terms hereof or
thereof.
(ii) It
has
the full corporate power and authority to service each Mortgage Loan, and to
execute, deliver and perform, and to enter into and consummate the transactions
contemplated by this Agreement and has duly authorized by all necessary
corporate action on its part the execution, delivery and performance of this
Agreement, assuming the due authorization, execution and delivery hereof by
the
other parties hereto or thereto, as applicable, constitutes its legal, valid
and
binding obligation, enforceable against it in accordance with its terms, except
that (a) the enforceability hereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors’ rights
generally and (b) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be
brought.
(iii) The
execution and delivery of this Agreement, the servicing of the Mortgage Loans
by
it under this Agreement, the consummation of any other of the transactions
contemplated by this Agreement, and the fulfillment of or compliance with the
terms hereof and thereof are in its ordinary course of business and will not
(A)
result in a breach of any term or provision of its charter or by-laws or (B)
conflict with, result in a breach, violation or acceleration of, or result
in a
default under, the terms of any other material agreement or instrument to which
it is a party or by which it may be bound, or (C) constitute a violation of
any
statute, order or regulation applicable to it of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it; and
it
is not in breach or violation of any material indenture or other material
agreement or instrument, or in violation of any statute, order or regulation
of
any court, regulatory body, administrative agency or governmental body having
jurisdiction over it which breach or violation may materially impair its ability
to perform or meet any of its obligations under this Agreement.
(iv) It
is an
approved servicer of conventional mortgage loans for Xxxxxx Xxx and Xxxxxxx
Mac
and is a mortgagee approved by the Secretary of Housing and Urban Development
pursuant to sections 203 and 211 of the National Housing Act.
(v) No
litigation is pending or, to the best of its knowledge, threatened, against
it
that would materially and adversely affect (a) the execution, delivery or
enforceability of this Agreement (b) its ability to service the EMC Mortgage
Loans, (c) to perform any of its other obligations under this Agreement in
accordance with the terms hereof, (d) its business operations, financial
conditions, or properties or assets owned by it, or (e) its ability to carry
on
its business as now conducted.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for its execution, delivery and performance of, or compliance
with, this Agreement or the consummation of the transactions contemplated hereby
or thereby, or if any such consent, approval, authorization or order is
required, it has obtained the same.
(vii) The
servicing practices used by the Company in respect of each Mortgage Loan have
been, and will continue to be, compliant in all material respects with
applicable laws and regulations.
(viii) As
of the
Closing Date and except as has been otherwise disclosed to the Master Servicer
and the Depositor, or disclosed in any public filing: (1) no default or
servicing related performance trigger has occurred as to any other Pass-Through
Transfer due to any act or failure to act of the Company; (2) no material
noncompliance with applicable servicing criteria as to any other Pass-Through
Transfer has occurred, been disclosed or reported by the Company; (3) the
Company has not been terminated as servicer in a residential mortgage loan
Pass-Through Transfer, either due to a servicing default or to application
of a
servicing performance test or trigger; (4) no material changes to the Company’s
servicing policies and procedures for similar loans have occurred in the
preceding three years outside of the normal changes warranted by regulatory
and
product type changes in the portfolio; (5) there are no aspects of the Company’s
financial condition that could have a material adverse impact on the performance
by the Company of its obligations hereunder; (6) there are no legal proceedings
pending, or known to be contemplated by governmental authorities, against the
Company that could be material to investors in the securities issued in such
Pass-Through Transfer; and (7) there are no affiliations, relationships or
transactions relating to the Company of a type that are described under Item
1119 of Regulation AB.
(ix) If
so
requested by the Depositor or the Master Servicer on any date, the Company
shall, within five Business Days following such request, confirm in writing
the
accuracy of the representations and warranties set forth in clause (a)(viii)
of
this Section or, if any such representation and warranty is not accurate as
of
the date of such request, provide reasonably adequate disclosure of the
pertinent facts, in writing, to the requesting party.
(x) As
a
condition to the succession to the Company or any subservicer as servicer or
subservicer under this Agreement by any Person (i) into which the Company or
such subservicer may be merged or consolidated, or (ii) which may be appointed
as a successor to the Company or any subservicer, the Company shall provide
to
the Master Servicer and the Depositor, at least 15 calendar days prior to the
effective date of such succession or appointment, (x) written notice to the
Master Servicer and the Depositor of such succession or appointment and (y)
in
writing and in form and substance reasonably satisfactory to the Master Servicer
and the Depositor, all information reasonably requested by the Master Servicer
or the 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.
(b) LaSalle
Bank National Association, in its capacity as Master Servicer and Securities
Administrator hereby represents and warrants to the Seller, the Depositor and
the Trustee as follows, as of the Closing Date:
(i) It
is a
national banking association duly formed, validly existing and in good standing
under the laws of the United States of America and is duly authorized and
qualified to transact any and all business contemplated by this Agreement to
be
conducted by the Master Servicer and the Securities Administrator and, is in
compliance with the doing business laws of any state, to the extent necessary
to
ensure its ability to perform any of its other obligations under this Agreement
in accordance with the terms hereof;
(ii) It
has
the full corporate power and authority to execute, deliver and perform, and
to
enter into and consummate the transactions contemplated by this Agreement and
has duly authorized by all necessary corporate action on its part the execution,
delivery and performance of this Agreement; and this Agreement, assuming the
due
authorization, execution and delivery hereof by the other parties hereto,
constitutes its legal, valid and binding obligation, enforceable against it
in
accordance with its terms, except that (a) the enforceability hereof may be
limited by bankruptcy, insolvency, moratorium, receivership and other similar
laws relating to creditors’ rights generally and (b) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject
to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
(iii) The
execution and delivery of this Agreement by it, the consummation of any other
of
the transactions contemplated by this Agreement, and the fulfillment of or
compliance with the terms hereof are in its ordinary course of business and
will
not (A) result in a material breach of any term or provision of its charter
or
by-laws or (B) materially conflict with, result in a material breach, violation
or acceleration of, or result in a material default under, the terms of any
other material agreement or instrument to which it is a party or by which it
may
be bound, or (C) constitute a material violation of any statute, order or
regulation applicable to it of any court, regulatory body, administrative agency
or governmental body having jurisdiction over it; and it is not in breach or
violation of any material indenture or other material agreement or instrument,
or in violation of any statute, order or regulation of any court, regulatory
body, administrative agency or governmental body having jurisdiction over it
which breach or violation may materially impair its ability to perform or meet
any of its obligations under this Agreement.
(iv) No
litigation is pending or, to the best of its knowledge, threatened, against
it
that would materially and adversely affect the execution, delivery or
enforceability of this Agreement or its ability to perform any of its other
obligations under this Agreement in accordance with the terms
hereof.
(v) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for its execution, delivery and performance of, or compliance
with, this Agreement or the consummation of the transactions contemplated
hereby, or if any such consent, approval, authorization or order is required,
it
has obtained the same.
(c) EMC
(in
its capacity as Seller) hereby represents and warrants to the Depositor and
the
Trustee as follows, as of the Closing Date:
(i) EMC
is
duly organized as a Delaware corporation and is validly existing and in good
standing under the laws of the State of Delaware and is duly authorized and
qualified to transact any and all business contemplated by this Agreement to
be
conducted by EMC in any state in which a Mortgaged Property is located or is
otherwise not required under applicable law to effect such qualification and,
in
any event, is in compliance with the doing business laws of any such state,
to
the extent necessary to ensure its ability to enforce each Mortgage Loan, to
sell the Mortgage Loans in accordance with the terms of the Mortgage Loan
Purchase Agreement and to perform any of its other obligations under this
Agreement in accordance with the terms hereof.
(ii) EMC
has
the full corporate power and authority to sell each Mortgage Loan, and to
execute, deliver and perform, and to enter into and consummate the transactions
contemplated by this Agreement and has duly authorized by all necessary
corporate action on the part of EMC the execution, delivery and performance
of
this Agreement, assuming the due authorization, execution and delivery hereof
by
the other parties hereto or thereto, as applicable, constitutes a legal, valid
and binding obligation of EMC, enforceable against EMC in accordance with its
terms, except that (a) the enforceability hereof may be limited by bankruptcy,
insolvency, moratorium, receivership and other similar laws relating to
creditors’ rights generally and (b) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to equitable
defenses and to the discretion of the court before which any proceeding therefor
may be brought.
(iii) The
execution and delivery of this Agreement by EMC, the sale of the Mortgage Loans
by EMC under the Mortgage Loan Purchase Agreement, the consummation of any
other
of the transactions contemplated by this Agreement, and the fulfillment of
or
compliance with the terms hereof and thereof are in the ordinary course of
business of EMC and will not (A) result in a material breach of any term or
provision of the charter or by-laws of EMC or (B) conflict with, result in
a
breach, violation or acceleration of, or result in a default under, the terms
of
any other material agreement or instrument to which EMC is a party or by which
it may be bound, or (C) constitute a violation of any statute, order or
regulation applicable to EMC of any court, regulatory body, administrative
agency or governmental body having jurisdiction over EMC; and EMC is not in
breach or violation of any material indenture or other material agreement or
instrument, or in violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having jurisdiction
over it which breach or violation may materially impair EMC’s ability to perform
or meet any of its obligations under this Agreement.
(iv) EMC
is an
approved Seller of conventional mortgage loans for Xxxxxx Xxx and Xxxxxxx Mac
and is a mortgagee approved by the Secretary of Housing and Urban Development
pursuant to sections 203 and 211 of the National Housing Act.
(v) No
litigation is pending or, to the best of EMC’s knowledge, threatened, against
EMC that would materially and adversely affect the execution, delivery or
enforceability of this Agreement or the ability of EMC to sell the Mortgage
Loans or to perform any of its other obligations under this Agreement in
accordance with the terms hereof or thereof.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by EMC of, or
compliance by EMC with, this Agreement or the consummation of the transactions
contemplated hereby, or if any such consent, approval, authorization or order
is
required, EMC has obtained the same.
(vii) With
respect to each Mortgage Loan as of the Closing Date (or such other date as
may
be specified in Section 7 of the Mortgage Loan Purchase Agreement), EMC hereby
remakes and restates each of the representations and warranties set forth in
Section 7 of the Mortgage Loan Purchase Agreement to the Depositor and the
Trustee to the same extent as if fully set forth herein.
(d) Upon
discovery by any of the parties hereto of a breach of a representation or
warranty set forth in the Mortgage Loan Purchase Agreement with respect to
the
Mortgage Loans that materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, the party discovering such breach
shall
give prompt written notice thereof to the other parties. EMC, in its capacity
as
Seller, hereby covenants with respect to the representations and warranties
set
forth in the Mortgage Loan Purchase Agreement with respect to the Mortgage
Loans, that within 90 days of the discovery of a breach of any representation
or
warranty set forth therein that materially and adversely affects the interests
of the Certificateholders in any Mortgage Loan, it shall cure such breach in
all
material respects and, if such breach is not so cured, (i) if such 90 day period
expires prior to the second anniversary of the Closing Date, remove such
Mortgage Loan (a “Deleted Mortgage Loan”) from the Trust Fund and substitute in
its place a Replacement Mortgage Loan, in the manner and subject to the
conditions set forth in this Section; or (ii) repurchase the affected Mortgage
Loan or Mortgage Loans from the Trustee at the Purchase Price in the manner
set
forth below; provided that any such substitution pursuant to (i) above or
repurchase pursuant to (ii) above shall not be effected prior to the delivery
to
the Trustee and the Securities Administrator of an Opinion of Counsel if
required by Section 2.05 hereof and any such substitution pursuant to (i) above
shall not be effected prior to the additional delivery to the applicable
Custodian of a Request for Release. The Trustee shall give prompt written notice
to the parties hereto of EMC’s failure to cure such breach as set forth in the
preceding sentence. EMC shall promptly reimburse the Master Servicer and the
Trustee for any expenses reasonably incurred by the Master Servicer or the
Trustee in respect of enforcing the remedies for such breach. To enable the
Master Servicer to amend the Mortgage Loan Schedule, EMC shall, unless it cures
such breach in a timely fashion pursuant to this Section 2.03, promptly notify
the Master Servicer whether it intends either to repurchase, or to substitute
for, the Mortgage Loan affected by such breach. With respect to the
representations and warranties with respect to the Mortgage Loans that are
made
to the best of EMC’s knowledge, if it is discovered by any of the Depositor, the
Master Servicer, EMC, the Securities Administrator or the Trustee that the
substance of such representation and warranty is inaccurate and such inaccuracy
materially and adversely affects the value of the related Mortgage Loan,
notwithstanding EMC’s lack of knowledge with respect to the substance of such
representation or warranty, EMC (in its capacity as Seller) shall nevertheless
be required to cure, substitute for or repurchase the affected Mortgage Loan
in
accordance with the foregoing.
With
respect to any Replacement Mortgage Loan or Loans, EMC (in its capacity as
Seller) shall deliver to the Trustee or the related Custodian on its behalf
for
the benefit of the Certificateholders such documents and agreements as are
required by Section 2.01. No substitution will be made in any calendar month
after the Determination Date for such month. Notwithstanding the foregoing,
such
substitution must be done within two years of the Closing Date. Scheduled
Payments due with respect to Replacement Mortgage Loans in the Due Period
related to the Distribution Date on which such proceeds are to be distributed
shall not be part of the Trust Fund and will be retained by EMC (in its capacity
as Seller). For the month of substitution, distributions to Certificateholders
will include the Scheduled Payment due on any Deleted Mortgage Loan for the
related Due Period and thereafter EMC (in its capacity as Seller) shall be
entitled to retain all amounts received in respect of such Deleted Mortgage
Loan. The Master Servicer shall amend the Mortgage Loan Schedule for the benefit
of the Certificateholders to reflect the removal of each such Deleted Mortgage
Loan and the substitution of the Replacement Mortgage Loan or Loans and the
Master Servicer shall deliver the amended Mortgage Loan Schedule to the
Securities Administrator, the Trustee and the related Custodian. Upon such
substitution, the Replacement Mortgage Loan or Loans shall be subject to the
terms of this Agreement in all respects, and EMC shall be deemed to have made
with respect to such Replacement Mortgage Loan or Loans, as of the date of
substitution, the representations and warranties set forth in Section 7 or
Section 8 of the Mortgage Loan Purchase Agreement with respect to such Mortgage
Loan. Upon any such substitution and the deposit into the Master Servicer
Collection Account of the amount required to be deposited therein in connection
with such substitution as described in the following paragraph and receipt
by
the related Custodian of a Request for Release for such Mortgage Loan, the
related Custodian shall release to EMC the Mortgage File relating to such
Deleted Mortgage Loan and held for the benefit of the Certificateholders and
the
Trustee shall execute and deliver at EMC’s direction such instruments of
transfer or assignment as have been prepared by EMC, in each case without
recourse, representation or warranty as shall be necessary to vest in EMC,
or
its respective designee, title to the Trustee’s interest in any Deleted Mortgage
Loan substituted for pursuant to this Section 2.03.
For
any
month in which EMC substitutes one or more Replacement Mortgage Loans for a
Deleted Mortgage Loan, the Master Servicer will determine the amount (if any)
by
which the aggregate principal balance of all the Replacement Mortgage Loans
as
of the date of substitution is less than the Stated Principal Balance (after
application of the principal portion of the Scheduled Payment due in the month
of substitution) of such Deleted Mortgage Loan. An amount equal to the aggregate
of such deficiencies, described in the preceding sentence for any Distribution
Date (such amount, the “Substitution Adjustment Amount”) shall be deposited into
the Master Servicer Collection Account, by EMC upon its delivering such
Replacement Mortgage Loan on the Determination Date for the Distribution Date
relating to the Prepayment Period during which the related Mortgage Loan became
required to be purchased or replaced hereunder.
In
the
event that EMC (in its capacity as Seller) shall have repurchased a Mortgage
Loan, the Purchase Price therefor shall be deposited into the Master Servicer
Collection Account maintained by the Master Servicer, on the Determination
Date
for the Distribution Date in the month following the month during which EMC
became obligated to repurchase or replace such Mortgage Loan and upon such
deposit of the Purchase Price, the delivery of an Opinion of Counsel if required
by Section 2.05 and the receipt of a Request for Release, the related Custodian
shall release the related Mortgage File held for the benefit of the
Certificateholders to EMC, and the Trustee shall execute and deliver at such
Person’s direction the related instruments of transfer or assignment prepared by
EMC, in each case without recourse, representation or warranty, as shall be
necessary to transfer title from the Trustee for the benefit of the
Certificateholders and transfer the Trustee’s interest to EMC to any Mortgage
Loan purchased pursuant to this Section 2.03. It is understood and agreed that
the obligation under this Agreement of EMC to cure, repurchase or replace any
Mortgage Loan as to which a breach has occurred and is continuing shall
constitute the sole remedies against EMC (in its capacity as Seller) respecting
such breach available to the Certificateholders, the Depositor or the
Trustee.
(e) The
representations and warranties set forth in this Section 2.03 hereof shall
survive delivery of the respective Mortgage Loans and Mortgage Files to the
Trustee or the related Custodian for the benefit of the
Certificateholders.
Section
2.04 Representations
and Warranties of the Depositor.
The
Depositor hereby represents and warrants to the Master Servicer, the Securities
Administrator and the Trustee as follows, as of the date hereof and as of the
Closing Date:
(i) The
Depositor is duly organized and is validly existing as a limited liability
company in good standing under the laws of the State of Delaware and has full
power and authority necessary to own or hold its properties and to conduct
its
business as now conducted by it and to enter into and perform its obligations
under this Agreement.
(ii) The
Depositor has the full power and authority to execute, deliver and perform,
and
to enter into and consummate the transactions contemplated by, this Agreement
and has duly authorized, by all necessary corporate action on its part, the
execution, delivery and performance of this Agreement; and this Agreement,
assuming the due authorization, execution and delivery hereof by the other
parties hereto, constitutes a legal, valid and binding obligation of the
Depositor, enforceable against the Depositor in accordance with its terms,
subject, as to enforceability, to (i) bankruptcy, insolvency, reorganization,
moratorium and other similar laws affecting creditors’ rights generally and (ii)
general principles of equity, regardless of whether enforcement is sought in
a
proceeding in equity or at law.
(iii) The
execution and delivery of this Agreement by the Depositor, the consummation
of
the transactions contemplated by this Agreement, and the fulfillment of or
compliance with the terms hereof and thereof are in the ordinary course of
business of the Depositor and will not (A) result in a material breach of any
term or provision of the certificate of formation or limited liability company
agreement of the Depositor or (B) materially conflict with, result in a material
breach, violation or acceleration of, or result in a material default under,
the
terms of any other material agreement or instrument to which the Depositor
is a
party or by which it may be bound or (C) constitute a material violation of
any
statute, order or regulation applicable to the Depositor of any court,
regulatory body, administrative agency or governmental body having jurisdiction
over the Depositor; and the Depositor is not in breach or violation of any
material indenture or other material agreement or instrument, or in violation
of
any statute, order or regulation of any court, regulatory body, administrative
agency or governmental body having jurisdiction over it which breach or
violation may materially impair the Depositor’s ability to perform or meet any
of its obligations under this Agreement.
(iv) No
litigation is pending, or, to the best of the Depositor’s knowledge, threatened,
against the Depositor that would materially and adversely affect the execution,
delivery or enforceability of this Agreement or the ability of the Depositor
to
perform its obligations under this Agreement in accordance with the terms hereof
or thereof.
(v) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Depositor
of, or compliance by the Depositor with this Agreement or the consummation
of
the transactions contemplated hereby or thereby, or if any such consent,
approval, authorization or order is required, the Depositor has obtained the
same.
(vi) The
Depositor has filed all reports required to be filed by Section 13 or 15(d)
of
the Exchange Act during the preceding 12 months (or for such shorter period
that
the Depositor was required to file such reports) and it has been subject to
such
filing requirement for the past 90 days.
The
Depositor hereby represents and warrants to the Trustee as of the Closing Date,
following the transfer of the Mortgage Loans to it by the Seller, the Depositor
had good title to the Mortgage Loans and the related Mortgage Notes were subject
to no offsets, claims, defenses or counterclaims.
It
is
understood and agreed that the representations and warranties set forth in
this
Section 2.04 shall survive delivery of the Mortgage Files to the Trustee or
the
related Custodian for the benefit of the Certificateholders. Upon discovery
by
the Depositor or the Trustee of a breach of such representations and warranties,
the party discovering such breach shall give prompt written notice to the others
and to each Rating Agency.
Section
2.05 Delivery
of Opinion of Counsel in Connection with Substitutions and
Repurchases.
(a) Notwithstanding
any contrary provision of this Agreement, with respect to any Mortgage Loan
that
is not in default or as to which default is not reasonably foreseeable, no
repurchase or substitution pursuant to Sections 2.02 or 2.03 shall be made
unless EMC delivers to the Trustee and the Securities Administrator an Opinion
of Counsel, addressed to the Trustee and the Securities Administrator, to the
effect that such repurchase or substitution would not (i) result in the
imposition of the tax on “prohibited transactions” of REMIC I, REMIC II, REMIC
III, REMIC IV or REMIC V or contributions after the Closing Date, as defined
in
Sections 860F(a)(2) and 860G(d) of the Code, respectively, or (ii) cause any
of
REMIC I, REMIC II, REMIC III, REMIC IV or REMIC V to fail to qualify as a REMIC
at any time that any Certificates are outstanding. Any Mortgage Loan as to
which
repurchase or substitution was delayed pursuant to this paragraph shall be
repurchased or the substitution therefor shall occur (subject to compliance
with
Sections 2.02 or 2.03) upon the earlier of (a) the occurrence of a default
or a
default becoming reasonably foreseeable with respect to such Mortgage Loan
and
(b) receipt by the Trustee of an Opinion of Counsel addressed to the Trustee
and
the Securities Administrator to the effect that such repurchase or substitution,
as applicable, will not result in the events described in clause (i) or clause
(ii) of the preceding sentence.
(b) Upon
discovery by the Depositor, EMC or the Master Servicer that any Mortgage Loan
does not constitute a “qualified mortgage” within the meaning of Section
860G(a)(3) of the Code, the party discovering such fact shall promptly (and
in
any event within 5 Business Days of discovery) give written notice thereof
to
the other parties and the Trustee and the Securities Administrator. In
connection therewith, EMC shall either (i) substitute, if the conditions in
Section 2.03 with respect to substitutions are satisfied, a Replacement Mortgage
Loan for the affected Mortgage Loan, or (ii) repurchase the affected Mortgage
Loan within 90 days of such discovery in the same manner as it would a Mortgage
Loan for a breach of representation or warranty in accordance with Section
2.03.
The Trustee shall reconvey to EMC the Mortgage Loan to be released pursuant
hereto (and the related Custodian shall deliver the related Mortgage File)
in
the same manner, and on the same terms and conditions, as it would a Mortgage
Loan repurchased for breach of a representation or warranty in accordance with
Section 2.03.
Section
2.06 Countersignature
and Delivery of Certificates.
(a) The
Trustee acknowledges the sale, transfer and assignment to it of the Trust Fund
and, concurrently with such transfer and assignment, and the Securities
Administrator has executed, countersigned and delivered, to or upon the order
of
the Depositor, the Certificates in authorized denominations evidencing the
entire ownership of the Trust Fund. The Trustee agrees to hold the Trust Fund
and exercise the rights referred to above for the benefit of all present and
future Holders of the Certificates and to perform the duties set forth in this
Agreement in accordance with its terms.
(b) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without
recourse all the right, title and interest of the Depositor in and to the REMIC
I Regular Interests and the other assets of REMIC II for the benefit of the
holders of the REMIC II Regular Interests and the Class R-2 Certificates. The
Trustee acknowledges receipt of the REMIC I Regular Interests (which are
uncertificated) and the other assets of REMIC II and declares that it holds
and
will hold the same in trust for the exclusive use and benefit of the holders
of
the REMIC II Regular Interests and the Class R-2 Certificates.
(c) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without
recourse all the right, title and interest of the Depositor in and to the REMIC
II Regular Interests and the other assets of REMIC III for the benefit of the
holders of the Regular Certificates (other than the Class C Certificates),
the
Class C Interest, the Class IO Interest and the Class R-3 Certificates. The
Trustee acknowledges receipt of the REMIC II Regular Interests (which are
uncertificated) and the other assets of REMIC III and declares that it holds
and
will hold the same in trust for the exclusive use and benefit of the holders
of
the Regular Certificates (other than the Class C Certificates), the Class C
Interest, the Class IO Interest and the Class R-3 Certificates.
(d) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without
recourse all the right, title and interest of the Depositor in and to the Class
C Interest for the benefit of the Holders of the Class C Certificates and Class
RX Certificates (in respect of the Class R-4 Interest). The Trustee acknowledges
receipt of the Class C Interest (which is uncertificated) and declares that
it
holds and will hold the same in trust for the exclusive use and benefit of
the
Holders of the Class C Certificates and Class RX Certificates (in respect of
the
Class R-4 Interest).
(e) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without
recourse all the right, title and interest of the Depositor in and to the Class
IO Interest for the benefit of the holders of the REMIC V Regular Interest
IO
and Class RX Certificates (in respect of the Class R-5 Interest). The Trustee
acknowledges receipt of the Class IO Interest (which is uncertificated) and
declares that it holds and will hold the same in trust for the exclusive use
and
benefit of the holders of the REMIC V Regular Interest IO and Class RX
Certificates (in respect of the Class R-5 Interest).
Section
2.07 Purposes
and Powers of the Trust.
The
purpose of the common law trust, created hereunder (the “Trust”), is to engage
in the following activities:
(a) acquire
and hold the Mortgage Loans and the other assets of the Trust Fund and the
proceeds therefrom for the benefit of the Certificateholders;
(b) to
issue
the Certificates sold to the Depositor in exchange for the Mortgage Loans and
the other assets of the Trust Fund;
(c) to
make
distributions on the Certificates;
(d) to
engage
in those activities that are necessary, suitable or convenient to accomplish
the
foregoing or are incidental thereto or connected therewith; and
(e) subject
to compliance with this Agreement, to engage in such other activities as may
be
required in connection with conservation of the Trust Fund and the making of
distributions to the Certificateholders.
The
Trust
is hereby authorized to engage in the foregoing activities. The Trust shall
not
engage in any activity other than in connection with the foregoing or other
than
as required or authorized by the terms of this Agreement while any Certificate
is outstanding.
ARTICLE
III
ADMINISTRATION
AND SERVICING OF EMC MORTGAGE LOANS BY THE COMPANY
Section
3.01 The
Company.
The
Company shall service and administer the EMC Mortgage Loans in accordance with
this Agreement and with customary and usual standards of practice of prudent
mortgage loan servicers in the respective states in which the related Mortgaged
Properties are located. In connection with such servicing and administration,
the Company shall have full power and authority, acting alone and/or through
subservicers as provided in Section 3.03, to do or cause to be done any and
all
things that it may deem necessary or desirable and consistent with the terms
of
this Agreement and customary servicing practices in connection with such
servicing and administration, including but not limited to, the power and
authority, subject to the terms hereof (i) to execute and deliver, on behalf
of
the Certificateholders and the Trustee, customary consents or waivers and other
instruments and documents, (ii) to consent to transfers of any related Mortgaged
Property and assumptions of the Mortgage Notes and related Mortgages (but only
in the manner provided herein), (iii) to collect any Insurance Proceeds and
other Liquidation Proceeds or Subsequent Recoveries, and (iv) subject to Section
3.12, to effectuate foreclosure or other conversion of the ownership of the
Mortgaged Property securing any EMC Mortgage Loan; provided that the Company
shall take no action that is inconsistent with or prejudices the interests
of
the Trust Fund, or the Certificateholders or this Agreement in any EMC Mortgage
Loan or the rights and interests of the Depositor, the Master Servicer or the
Trustee under this Agreement.
Without
limiting the generality of the foregoing, the Company, in its own name or in
the
name of the Trust, the Depositor or the Trustee, is hereby authorized and
empowered by the Trust, the Depositor and the Trustee, when the Company believes
it appropriate in its reasonable judgment, to execute and deliver, on behalf
of
the Trustee, the Depositor, the Certificateholders or any of them, any and
all
instruments of satisfaction or cancellation, or of partial or full release
or
discharge and all other comparable instruments, with respect to the EMC Mortgage
Loans, and with respect to the related Mortgaged Properties held for the benefit
of the Certificateholders. The Company shall prepare and deliver to the
Depositor and/or the Trustee such documents requiring execution and delivery
by
any or all of them as are necessary or appropriate to enable the Company to
service and administer the EMC Mortgage Loans. Upon receipt of such documents,
the Depositor and/or the Trustee shall execute such documents and deliver them
to the Company.
In
accordance with the standards of the first paragraph of this Section 3.01,
the
Company shall advance or cause to be advanced funds as necessary for the purpose
of effecting the payment of taxes and assessments on the Mortgaged Properties
relating to the EMC Mortgage Loans, which advances shall be reimbursable in
the
first instance from related collections from the Mortgagors pursuant to Section
5.04, and further as provided in Section 5.02. All costs incurred by the
Company, if any, in effecting the timely payments of taxes and assessments
on
the Mortgaged Properties relating to the EMC Mortgage Loans and related
insurance premiums shall not, for the purpose of calculating monthly
distributions to the Certificateholders, be added to the Stated Principal
Balance under the related EMC Mortgage Loans, notwithstanding that the terms
of
such Mortgage Loans so permit.
If
the
Mortgage relating to a Mortgage Loan had a lien senior to the Mortgage Loan
on
the related Mortgaged Property as of the Cut-off Date, then the Company may
consent to the refinancing of the prior senior lien, provided that the following
requirements are met:
(i) the
resulting Combined Loan-to-Value Ratio of such Mortgage Loan is no higher than
the Combined Loan-to-Value Ratio prior to such refinancing; and
(ii) the
interest rate, or, in the case of an adjustable rate existing senior lien,
the
maximum interest rate, for the loan evidencing the refinanced senior lien is
no
more than 2.0% higher than the interest rate or the maximum interest rate,
as
the case may be, on the loan evidencing the existing senior lien immediately
prior to the date of such refinancing; and
(iii) the
loan
evidencing the refinanced senior lien is not subject to negative
amortization.
The
Trustee shall furnish the Company and the related Servicer with any powers
of
attorney and other documents in form as provided to it necessary or appropriate
to enable the Company and the related Servicer to service and administer the
related Mortgage Loans and REO Property, to execute and deliver instruments
of
satisfaction or cancellation, or of partial or full release or discharge, and
to
foreclose upon or otherwise liquidate Mortgaged Property, and to appeal,
prosecute or defend in any court action relating to the Mortgage Loans or the
Mortgaged Property, in accordance with the related Servicing Agreement and
this
Agreement.
Section
3.02 Due-on-Sale
Clauses; Assumption Agreements.
(a) Except
as
otherwise provided in this Section 3.02, when any property subject to a Mortgage
has been or is about to be conveyed by the Mortgagor, the Company shall to
the
extent that it has knowledge of such conveyance, enforce any due-on-sale clause
contained in any Mortgage Note or Mortgage, to the extent permitted under
applicable law and governmental regulations, but only to the extent that such
enforcement will not adversely affect or jeopardize coverage under any Required
Insurance Policy. Notwithstanding the foregoing, the Company is not required
to
exercise such rights with respect to an EMC Mortgage Loan if the Person to
whom
the related Mortgaged Property has been conveyed or is proposed to be conveyed
satisfies the terms and conditions contained in the Mortgage Note and Mortgage
related thereto and the consent of the mortgagee under such Mortgage Note or
Mortgage is not otherwise so required under such Mortgage Note or Mortgage
as a
condition to such transfer. In the event that the Company is prohibited by
law
from enforcing any such due-on-sale clause, or if coverage under any Required
Insurance Policy would be adversely affected, or if nonenforcement is otherwise
permitted hereunder, the Company is authorized, subject to Section 3.02(b),
to
take or enter into an assumption and modification agreement from or with the
person to whom such property has been or is about to be conveyed, pursuant
to
which such person becomes liable under the Mortgage Note and, unless prohibited
by applicable state law, the Mortgagor remains liable thereon, provided that
the
Mortgage Loan shall continue to be covered (if so covered before the Company
enters such agreement) by the applicable Required Insurance Policies. The
Company, subject to Section 3.02(b), is also authorized with the prior approval
of the insurers under any Required Insurance Policies to enter into a
substitution of liability agreement with such Person, pursuant to which the
original Mortgagor is released from liability and such Person is substituted
as
Mortgagor and becomes liable under the Mortgage Note. Notwithstanding the
foregoing, the Company shall not be deemed to be in default under this Section
3.02(a) by reason of any transfer or assumption that the Company reasonably
believes it is restricted by law from preventing.
(b) Subject
to the Company’s duty to enforce any due-on-sale clause to the extent set forth
in Section 3.02(a), in any case in which a Mortgaged Property has been conveyed
to a Person by a Mortgagor, and such Person is to enter into an assumption
agreement or modification agreement or supplement to the Mortgage Note or
Mortgage that requires the signature of the Trustee, or if an instrument of
release signed by the Trustee is required releasing the Mortgagor from liability
on the related EMC Mortgage Loan, the Company shall prepare and deliver or
cause
to be prepared and delivered to the Trustee for signature and shall direct,
in
writing, the Trustee to execute the assumption agreement with the Person to
whom
the Mortgaged Property is to be conveyed and such modification agreement or
supplement to the Mortgage Note or Mortgage or other instruments as are
reasonable or necessary to carry out the terms of the Mortgage Note or Mortgage
or otherwise to comply with any applicable laws regarding assumptions or the
transfer of the Mortgaged Property to such Person. In connection with any such
assumption, no material term of the Mortgage Note (including, but not limited
to, the Mortgage Rate, the amount of the Scheduled Payment and any other term
affecting the amount or timing of payment on the EMC Mortgage Loan) may be
changed. In addition, the substitute Mortgagor and the Mortgaged Property must
be acceptable to the Company in accordance with its servicing standards as
then
in effect. The Company shall notify the Trustee that any such substitution
or
assumption agreement has been completed by forwarding to the Trustee the
original (and to the Master Servicer a copy) of such substitution or assumption
agreement, which in the case of the original shall be added to the related
Mortgage File and shall, for all purposes, be considered a part of such Mortgage
File to the same extent as all other documents and instruments constituting
a
part thereof. Any fee collected by the Company for entering into an assumption
or substitution of liability agreement will be retained by the Company as
additional servicing compensation.
Section
3.03 Subservicers.
The
Company shall perform all of its servicing responsibilities hereunder or may
cause a subservicer to perform any such servicing responsibilities on its
behalf, but the use by the Company of a subservicer shall not release the
Company from any of its obligations hereunder and the Company shall remain
responsible hereunder for all acts and omissions of each subservicer as fully
as
if such acts and omissions were those of the Company. The Company shall pay
all
fees of each subservicer from its own funds, and a subservicer’s fee shall not
exceed the Servicing Fee payable to the Company hereunder.
At
the
cost and expense of the Company, without any right of reimbursement from its
Protected Account, the Company shall be entitled to terminate the rights and
responsibilities of a subservicer and arrange for any servicing responsibilities
to be performed by a successor subservicer; provided, however, that nothing
contained herein shall be deemed to prevent or prohibit the Company, at the
Company’s option, from electing to service the related Mortgage Loans itself. In
the event that the Company’s responsibilities and duties under this Agreement
are terminated pursuant to Section 9.01, the Company shall at its own cost
and
expense terminate the rights and responsibilities of each subservicer effective
as of the date of termination of the Company. The Company shall pay all fees,
expenses or penalties necessary in order to terminate the rights and
responsibilities of each subservicer from the Company’s own funds without
reimbursement from the Trust Fund.
Notwithstanding
the foregoing, the Company shall not be relieved of its obligations hereunder
and shall be obligated to the same extent and under the same terms and
conditions as if it alone were servicing and administering the EMC Mortgage
Loans. The Company shall be entitled to enter into an agreement with a
subservicer for indemnification of the Company by the subservicer and nothing
contained in this Agreement shall be deemed to limit or modify such
indemnification.
Any
subservicing agreement and any other transactions or services relating to the
EMC Mortgage Loans involving a subservicer shall be deemed to be between such
subservicer and the Company alone, and neither the Master Servicer nor the
Trustee shall have any obligations, duties or liabilities with respect to such
subservicer including any obligation, duty or liability of either the Master
Servicer or the Trustee to pay such subservicer’s fees and expenses. For
purposes of remittances to the Securities Administrator pursuant to this
Agreement, the Company shall be deemed to have received a payment on an EMC
Mortgage Loan when a subservicer has received such payment.
Section
3.04 Documents,
Records and Funds in Possession of the Company to Be Held for
Trustee.
Notwithstanding
any other provisions of this Agreement, the Company shall transmit to the
Trustee or the related Custodian on behalf of the Trustee as required by this
Agreement all documents and instruments in respect of an EMC Mortgage Loan
coming into the possession of the Company from time to time and shall account
fully to the Master Servicer for any funds received by the Company or that
otherwise are collected by the Company as Liquidation Proceeds, Insurance
Proceeds or Subsequent Recoveries in respect of any such Mortgage Loan. All
Mortgage Files and funds collected or held by, or under the control of, the
Company in respect of any EMC Mortgage Loans, whether from the collection of
principal and interest payments or from Liquidation Proceeds, Insurance Proceeds
or Subsequent Recoveries, including but not limited to, any funds on deposit
in
the Protected Account maintained by the Company, shall be held by the Company
for and on behalf of the Trustee and shall be and remain the sole and exclusive
property of the Trustee, subject to the applicable provisions of this Agreement.
The Company also agrees that it shall not create, incur or subject any Mortgage
File or any funds that are deposited in the Protected Account maintained by
the
Company or in any Escrow Account, or any funds that otherwise are or may become
due or payable to the Trustee for the benefit of the Certificateholders, to
any
claim, lien, security interest, judgment, levy, writ of attachment or other
encumbrance, or assert by legal action or otherwise any claim or right of set
off against any Mortgage File or any funds collected on, or in connection with,
an EMC Mortgage Loan, except, however, that the Company shall be entitled to
set
off against and deduct from any such funds any amounts that are properly due
and
payable to the Company under this Agreement.
All
funds
collected or held by, or under the control of, the Company, in respect of any
Mortgage Loans, whether from the collection of principal and interest payments
or from Liquidation Proceeds, Subsequent Recoveries or Insurance Proceeds,
shall
be held by the Company for and on behalf of the Trustee and the
Certificateholders and shall be and remain the sole and exclusive property
of
the Trustee; provided, however, that the Company shall be entitled to setoff
against, and deduct from, any such funds any amounts that are properly due
and
payable to the Company under this Agreement.
Section
3.05 Optional
Purchase of Certain Mortgage Loans.
With
respect to any Mortgage Loan which as of the first day of a Fiscal Quarter
is
delinquent in payment by 90 days or more or is an REO Property, EMC shall have
the right to purchase any such Mortgage Loan or REO Property from the Trust
at a
price equal to the Purchase Price; provided however (i) that such Mortgage
Loan
is still 90 days or more delinquent or is an REO Property as of the date of
such
purchase and (ii) this purchase option, if not theretofore exercised, shall
terminate on the date prior to the last day of the related Fiscal Quarter.
This
purchase option, if not exercised, shall not be thereafter reinstated unless
the
delinquency is cured and the Mortgage Loan thereafter again becomes 90 days
or
more delinquent or becomes an REO Property, in which case the option shall
again
become exercisable as of the first day of the related Fiscal
Quarter.
If
at any
time EMC remits to the Master Servicer a payment for deposit in the Master
Servicer Collection
Account
covering the amount of the Purchase Price for such a Mortgage Loan, and EMC
provides to the Master Servicer and Trustee an Officer’s Certificate stating
that the amount of such payment has been deposited in the Master
Servicer Collection
Account,
then the Trustee shall execute the assignment of such Mortgage Loan prepared
and
delivered to the Trustee, at the request of EMC, without recourse,
representation or warranty, to EMC which shall succeed to all the Trustee’s
right, title and interest in and to such Mortgage Loan, and all security and
documents relative thereto. Such assignment shall be an assignment outright
and
not for security. EMC will thereupon own such Mortgage, and all such security
and documents, free of any further obligation to the Trustee or the
Certificateholders with respect thereto.
Section
3.06 Release
of Mortgage Files.
(a) Upon
becoming aware of the payment in full of any Mortgage Loan, or the receipt
by
the Company or the related Servicer of a notification that payment in full
has
been escrowed in a manner customary for such purposes for payment to
Certificateholders on the next Distribution Date, the Company or a Servicer
(pursuant to the related Servicing Agreement), as applicable, will (or if the
Company or the related Servicer does not, the Master Servicer may), promptly
furnish to the Custodian, on behalf of the Trustee, two copies of a
certification substantially in the form of Exhibit G hereto signed by a
Servicing Officer or Master Servicing Officer (as applicable) or in a mutually
agreeable electronic format which will, in lieu of a signature on its face,
originate from a Servicing Officer or Master Servicing Officer (which
certification shall include a statement to the effect that all amounts received
in connection with such payment that are required to be deposited in the
Protected Account maintained by the Company pursuant to Article V or by the
related Servicer pursuant to the related Servicing Agreement have been or will
be so deposited) and shall request that the Custodian, on behalf of the Trustee,
deliver to the Company or the related Servicer or the Master Servicer the
related Mortgage File. Upon receipt of such certification and request, the
Custodian, on behalf of the Trustee, shall promptly release the related Mortgage
File to the Company or the related Servicer or the Master Servicer and the
Trustee and Custodian shall have no further responsibility with regard to such
Mortgage File. Upon any such payment in full, the Company, the Master Servicer
or the related Servicer (as applicable) is authorized, to give, as agent for
the
Trustee as the mortgagee under the Mortgage that secured the Mortgage Loan,
an
instrument of satisfaction (or assignment of mortgage without recourse,
representation or warranty) regarding the Mortgaged Property subject to the
Mortgage, which instrument of satisfaction or assignment, as the case may be,
shall be delivered to the Person or Persons entitled thereto against receipt
therefor of such payment, it being understood and agreed that no expenses
incurred in connection with such instrument of satisfaction or assignment,
as
the case may be, shall be chargeable to the Protected Account.
(b) From
time
to time and as appropriate for the servicing or foreclosure of any Mortgage
Loan
and in accordance with this Agreement and the related Servicing Agreement,
as
applicable, the Trustee shall execute such documents as shall be prepared and
furnished to the Trustee by the Company, the Servicer or the Master Servicer
(in
form reasonably acceptable to the Trustee) and as are necessary to the
prosecution of any such proceedings. The related Custodian, on behalf of the
Trustee, shall, pursuant to the related Custodial Agreement, upon the request
of
the Company, the Servicer or the Master Servicer, and delivery to the related
Custodian, on behalf of the Trustee, of two copies of a request for release
signed by a Servicing Officer or Master Servicing Officer, as applicable,
substantially in the form of Exhibit G (or in a mutually agreeable electronic
format which will, in lieu of a signature on its face, originate from a
Servicing Officer or Master Servicing Officer, as applicable), release the
related Mortgage File held in its possession or control to the Company, the
Servicer or the Master Servicer, as applicable. Such trust receipt shall
obligate the Company, the Servicer or the Master Servicer to return the Mortgage
File to the Custodian on behalf of the Trustee, when the need therefor by such
Person no longer exists unless the Mortgage Loan shall be liquidated, in which
case, upon receipt of a certificate of a Servicing Officer or Master Servicing
Officer, as applicable similar to that hereinabove specified, the Mortgage
File
shall be released by the Custodian, on behalf of the Trustee, to the Company,
the Servicer or the Master Servicer.
Section
3.07 Maintenance
of Hazard Insurance.
The
Company shall cause to be maintained, for each EMC Mortgage Loan, hazard
insurance on buildings upon, or comprising part of, the Mortgaged Property
against loss by fire, hazards of extended coverage and such other hazards as
are
customary in the area where the related Mortgaged Property is located with
an
insurer which is licensed to do business in the state where the related
Mortgaged Property is located. Each such policy of standard hazard insurance
shall contain, or have an accompanying endorsement that contains, a standard
mortgagee clause. The Company shall also cause flood insurance to be maintained
on property acquired upon foreclosure or deed in lieu of foreclosure of any
EMC
Mortgage Loan, to the extent described below. Pursuant to Section 5.01, any
amounts collected by the Company under any such policies (other than the amounts
to be applied to the restoration or repair of the related Mortgaged Property
or
property thus acquired or amounts released to the Mortgagor in accordance with
the Company’s normal servicing procedures) shall be deposited in the Protected
Account maintained by the Company. Any cost incurred by the Company in
maintaining any such insurance shall not, for the purpose of calculating monthly
distributions to the Certificateholders or remittances to the Securities
Administrator for their benefit, be added to the principal balance of the
Mortgage Loan, notwithstanding that the terms of the EMC Mortgage Loan so
permit. Such costs shall be recoverable by the Company out of late payments
by
the related Mortgagor or out of Liquidation Proceeds to the extent permitted
by
Section 5.02. It is understood and agreed that no earthquake or other additional
insurance is to be required of any Mortgagor or maintained on property acquired
in respect of a Mortgage other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. If the Mortgaged Property is located at the time of
origination of the related EMC Mortgage Loan in a federally designated special
flood hazard area and such area is participating in the national flood insurance
program, the Company shall cause flood insurance to be maintained with respect
to such EMC Mortgage Loan. Such flood insurance shall be in an amount equal
to
the least of (i) the Stated Principal Balance of the related EMC Mortgage Loan,
(ii) minimum amount required to compensate for damage or loss on a replacement
cost basis or (iii) the maximum amount of such insurance available for the
related Mortgaged Property under the Flood Disaster Protection Act of 1973,
as
amended.
In
the
event that the Company shall obtain and maintain a blanket policy insuring
against hazard losses on all of the EMC Mortgage Loans, it shall conclusively
be
deemed to have satisfied its obligations as set forth in the first sentence
of
this Section 3.07, it being understood and agreed that such policy may contain
a
deductible clause on terms substantially equivalent to those commercially
available and maintained by comparable servicers. If such policy contains a
deductible clause, the Company shall, in the event that there shall not have
been maintained on the related Mortgaged Property a policy complying with the
first sentence of this Section 3.07, and there shall have been a loss that
would
have been covered by such policy, deposit in the Protected Account maintained
by
the Company the amount not otherwise payable under the blanket policy because
of
such deductible clause. Such deposit shall be from the Company’s own funds
without reimbursement therefor. In connection with its activities as
administrator and servicer of the EMC Mortgage Loans, the Company agrees to
present, on behalf of itself and the Trustee for the benefit of the
Certificateholders claims under any such blanket policy.
Section
3.08 Presentment
of Claims and Collection of Proceeds.
The
Company shall prepare and present on behalf of the Trustee and the
Certificateholders all claims under the Required Insurance Policies relating
to
the EMC Mortgage Loans and take such actions (including the negotiation,
settlement, compromise or enforcement of the insured’s claim) as shall be
necessary to realize recovery under such Required Insurance Policies. Any
proceeds disbursed to the Company in respect of such Required Insurance Policies
shall be promptly deposited in the Protected Account maintained by the Company
upon receipt, except that any amounts that are to be applied upon receipt to
the
repair or restoration of the related Mortgaged Property, which repair or
restoration the owner of such Mortgaged Property or EMC, as applicable, has
agreed to make as a condition precedent to the presentation of its claims on
the
related EMC Mortgage Loan under the applicable Insurance Policy, need not be
so
deposited (or remitted).
Section
3.09 Books
and
Records.
The
Company shall be responsible for maintaining, and shall maintain, a complete
set
of books and records for the EMC Mortgage Loans which shall be appropriately
identified in the Company’s computer system to clearly reflect the ownership of
the EMC Mortgage Loans by the Trust. In particular, the Company shall maintain
in its possession, available for inspection by the Master Servicer, the
Securities Administrator and the Trustee and shall deliver to the Master
Servicer, the Securities Administrator and the Trustee upon demand, evidence
of
compliance with all federal, state and local laws, rules and regulations. The
Trustee, the Securities Administrator and the Master Servicer, and any
governmental or regulatory agency with jurisdiction over the Trustee, the
Securities Administrator or the Master Servicer, as applicable, shall have
the
right, upon reasonable advance notice to the Company, to inspect and examine
the
books and records of the Company. To the extent that original documents are
not
required for purposes of realization of Liquidation Proceeds or Insurance
Proceeds, documents maintained by the Company may be in the form of microfilm
or
microfiche or such other reliable means of recreating original documents,
including, but not limited to, optical imagery techniques so long as the Company
complies with the requirements of Accepted Servicing Practices. During the
term
of this Agreement, the Company shall, upon reasonable advance notice, make
available a Servicing Officer to the Master Servicer for answering questions
and
responding to inquiries.
The
Company shall maintain with respect to each EMC Mortgage Loan and shall make
available for inspection by the Master Servicer, the Securities Administrator
and the Trustee the related servicing file during the time such EMC Mortgage
Loan is subject to this Agreement and thereafter in accordance with applicable
law.
Payments
on the Mortgage Loans, including any payoffs, made in accordance with the
related Mortgage File will be entered in the Company’s set of books and records
no more than two business days after receipt and identification, and allocated
to principal or interest as specified in the related Mortgage File.
Section
3.10 Custodians
to Retain Possession of Certain Insurance Policies and Documents.
The
related Custodian on behalf of the Trustee, shall retain possession and custody
of the originals (to the extent available) of any certificate of insurance
if
applicable, and any certificates of renewal as to the foregoing as may be issued
from time to time as contemplated by this Agreement. Until all amounts
distributable in respect of the Certificates have been distributed in full
and
the Company or the related Servicer, as applicable otherwise has fulfilled
its
obligations under this Agreement or the related Servicing Agreement, as
applicable, the related Custodian on behalf of the Trustee shall also retain
possession and custody of each Mortgage File in accordance with and subject
to
the terms and conditions of this Agreement. The Company shall promptly deliver
or cause to be delivered to the related Custodian on behalf of the Trustee,
upon
the execution or receipt thereof the originals of any certificates of renewal,
and such other documents or instruments that constitute portions of the Mortgage
File that come into the possession of the Company from time to
time.
Section
3.11 Fidelity
Bond, Errors and Omissions Insurance.
The
Company shall maintain, at its own expense, a blanket fidelity bond and an
errors and omissions insurance policy, with broad coverage with responsible
companies on all officers, employees or other persons acting in any capacity
with regard to the EMC Mortgage Loans and who handle funds, money, documents
and
papers relating to the EMC Mortgage Loans. The fidelity bond and errors and
omissions insurance shall be in the form of the Mortgage Banker’s Blanket Bond
and shall protect and insure the Company against losses, including forgery,
theft, embezzlement, fraud, errors and omissions and negligent acts of such
persons. Such fidelity bond shall also protect and insure the Company against
losses in connection with the failure to maintain any insurance policies
required pursuant to this Agreement and the release or satisfaction of an EMC
Mortgage Loan which is not in accordance with Accepted Servicing Practices.
No
provision of this Section 3.11 requiring the fidelity bond and errors and
omissions insurance shall diminish or relieve the Company from its duties and
obligations as set forth in this Agreement. The minimum coverage under any
such
bond and insurance policy shall be at least equal to the corresponding amounts
required by Accepted Servicing Practices. The Company shall deliver to the
Master Servicer annually (together with the Company’s Annual Statement of
Compliance required under Section 3.16 hereof) a certificate from the surety
and
the insurer as to the existence of the fidelity bond and errors and omissions
insurance policy (along with a copy of such policy then in effect) and shall
obtain a statement from the surety and the insurer that such fidelity bond
or
insurance policy shall in no event be terminated or materially modified without
thirty days prior written notice to the Master Servicer and the Trustee. The
Company shall notify the Master Servicer, the Securities Administrator and
the
Trustee in writing within five business days of receipt of notice that such
fidelity bond or insurance policy will be, or has been, materially modified
or
terminated. The Trustee for the benefit of the Certificateholders must be named
as loss payees on the fidelity bond and as additional insured on the errors
and
omissions policy.
Section
3.12 Realization
Upon Defaulted Mortgage Loans; Determination of Excess Liquidation Proceeds
and
Realized Losses; Repurchases of Certain Mortgage Loans.
(a) The
Company shall use reasonable efforts to foreclose upon or otherwise comparably
convert the ownership of properties securing such of the EMC Mortgage Loans
as
come into and continue in default and as to which no satisfactory arrangements
can be made for collection of delinquent payments. In connection with such
foreclosure or other conversion, the Company shall follow such practices and
procedures as it shall deem necessary or advisable and as shall be normal and
usual in its general mortgage servicing activities and the requirements of
the
insurer under any Required Insurance Policy; provided that the Company shall
not
be required to expend its own funds in connection with any foreclosure or
towards the restoration of any property unless it shall determine (i) that
such
restoration and/or foreclosure will increase the proceeds of liquidation of
the
EMC Mortgage Loan after reimbursement to itself of such expenses and (ii) that
such expenses will be recoverable to it through Insurance Proceeds or
Liquidation Proceeds (respecting which it shall have priority for purposes
of
withdrawals from the Protected Account maintained by the Company pursuant to
Section 5.02). If the Company reasonably believes that Liquidation Proceeds
with
respect to any such EMC Mortgage Loan would not be increased as a result of
such
foreclosure or other action, such EMC Mortgage Loan will be charged-off and
will
become a Liquidated Loan. The Company will give notice of any such charge-off
and related Final Recovery Determination to the Trustee and the Master Servicer
pursuant to Section 5.03. The Company shall be responsible for all other costs
and expenses incurred by it in any such proceedings; provided that such costs
and expenses shall be Servicing Advances and that it shall be entitled to
reimbursement thereof from the proceeds of liquidation of the related Mortgaged
Property, as contemplated in Section 5.02. If the Company has knowledge that
a
Mortgaged Property that the Company is contemplating acquiring in foreclosure
or
by deed- in-lieu of foreclosure is located within a one-mile radius of any
site
with environmental or hazardous waste risks known to the Company, the Company
will, prior to acquiring the related Mortgaged Property, consider such risks
and
only take action in accordance with its established environmental review
procedures.
With
respect to any REO Property relating to an EMC Mortgage Loan, the deed or
certificate of sale shall be taken in the name of the Trustee for the benefit
of
the Certificateholders (or the Trustee’s nominee on behalf of the
Certificateholders). The Trustee’s name shall be placed on the title to such REO
Property solely as the Trustee hereunder and not in its individual capacity.
The
Company shall ensure that the title to such REO Property references this
Agreement and the Trustee’s capacity hereunder. Pursuant to its efforts to sell
such REO Property, the Company shall either itself or through an agent selected
by the Company protect and conserve such REO Property in the same manner and
to
such extent as is customary in the locality where such REO Property is located
and may, incident to its conservation and protection of the interests of the
Certificateholders, rent the same, or any part thereof, as the Company deems
to
be in the best interest of the Company and the Certificateholders for the period
prior to the sale of such REO Property. The Company shall prepare for and
deliver to the Trustee, the Master Servicer and the Securities Administrator
a
statement with respect to each such REO Property that has been rented showing
the aggregate rental income received and all expenses incurred in connection
with the management and maintenance of such REO Property at such times as is
necessary to enable the Securities Administrator to comply with the reporting
requirements of the REMIC Provisions. The net monthly rental income, if any,
from such REO Property shall be deposited in the Protected Account maintained
by
the Company no later than the close of business on each Determination Date.
The
Company shall perform the tax reporting and withholding related to foreclosures,
abandonments and cancellation of indebtedness income as specified by Sections
1445, 6050J and 6050P of the Code by preparing and filing such tax and
information returns, as may be required.
In
the
event that the Trust Fund acquires any Mortgaged Property as aforesaid or
otherwise in connection with a default or reasonably foreseeable default on
an
EMC Mortgage Loan, the Company shall dispose of such Mortgaged Property prior
to
three years after its acquisition by the Trust Fund or, at the expense of the
Trust Fund, request more than 60 days prior to the day on which such three-year
period would otherwise expire, an extension of the three-year grace period
unless the Trustee and the Securities Administrator shall have been supplied
with an Opinion of Counsel addressed to the Trustee and the Securities
Administrator (such opinion not to be an expense of the Trustee or the
Securities Administrator) to the effect that the holding by the Trust Fund
of
such Mortgaged Property subsequent to such three-year period will not result
in
the imposition of taxes on “prohibited transactions” of REMIC I, REMIC II, REMIC
III, REMIC IV or REMIC V as defined in Section 860F of the Code or cause any
of
REMIC I, REMIC II, REMIC III, REMIC IV or REMIC V to fail to qualify as a REMIC
at any time that any Certificates are outstanding, in which case the Trust
Fund
may continue to hold such Mortgaged Property (subject to any conditions
contained in such Opinion of Counsel). Notwithstanding any other provision
of
this Agreement, no Mortgaged Property acquired by the Trust Fund shall be rented
(or allowed to continue to be rented) or otherwise used for the production
of
income by or on behalf of the Trust Fund in such a manner or pursuant to any
terms that would (i) cause such Mortgaged Property to fail to qualify as
“foreclosure property” within the meaning of Section 860G(a)(8) of the Code or
(ii) subject any of REMIC I, REMIC II, REMIC III, REMIC IV or REMIC V to the
imposition of any federal, state or local income taxes on the income earned
from
such Mortgaged Property under Section 860G(c) of the Code or otherwise, unless
the Company has agreed to indemnify and hold harmless the Trust Fund with
respect to the imposition of any such taxes.
The
decision of the Company to foreclose on a defaulted EMC Mortgage Loan shall
be
subject to a determination by the Company that the proceeds of such foreclosure
would exceed the costs and expenses of bringing such a proceeding. The income
earned from the management of any Mortgaged Properties acquired through
foreclosure or other judicial proceeding, net of reimbursement to the Company
for expenses incurred (including any property or other taxes) in connection
with
such management and net of unreimbursed Servicing Fees, Advances, Servicing
Advances and any management fee paid or to be paid with respect to the
management of such Mortgaged Property, shall be applied to the payment of
principal of, and interest on, the related defaulted EMC Mortgage Loans (with
interest accruing as though such Mortgage Loans were still current) and all
such
income shall be deemed, for all purposes in the Agreement, to be payments on
account of principal and interest on the related Mortgage Notes and shall be
deposited into the Protected Account maintained by the Company. To the extent
the income received during a Prepayment Period is in excess of the amount
attributable to amortizing principal and accrued interest at the related
Mortgage Rate on the related EMC Mortgage Loan, such excess shall be considered
to be a partial Principal Prepayment for all purposes hereof.
The
Liquidation Proceeds from any liquidation of a related EMC Mortgage Loan, net
of
any payment to the Company as provided above, shall be deposited in the
Protected Account upon
receipt and made available on
the
next succeeding Determination Date following receipt thereof for distribution
on
the related Distribution Date, except that any Excess Liquidation Proceeds
shall
be retained by the Company as additional servicing compensation.
The
proceeds of any Liquidated Loan, as well as any recovery resulting from a
partial collection of related Liquidation Proceeds or any income from a an
REO
Property, will be applied in the following order of priority: first, to
reimburse the Company and the Master Servicer for any related unreimbursed
Servicing Advances, Master Servicing Fees and Servicing Fees, pursuant to
Section 5.02 or this Section 3.12; second, to reimburse the Company and the
Master Servicer for any unreimbursed Advances, pursuant to Section 5.02 or
this
Section 3.12; third, to accrued and unpaid interest (to the extent no Advance
has been made for such amount) on the EMC Mortgage Loan or related REO Property,
at the Net Mortgage Rate to the first day of the month in which such amounts
are
required to be distributed; and fourth, as a recovery of principal of the EMC
Mortgage Loan.
(b) On
each
Determination Date, the Company shall determine the respective aggregate amounts
of Excess Liquidation Proceeds and Realized Losses, if any, for the related
Prepayment Period.
(c) The
Company has no intent to foreclose on any EMC Mortgage Loan based on the
delinquency characteristics as of the Closing Date; provided, that the foregoing
does not prevent the Company from initiating foreclosure proceedings on any
date
hereafter if the facts and circumstances of such EMC Mortgage Loans including
delinquency characteristics in the Company’s discretion so warrant such
action.
Section
3.13 Servicing
Compensation.
As
compensation for its activities hereunder, the Company shall be entitled to
retain or withdraw from the Protected Account out of each payment of interest
on
an EMC Mortgage Loan included in the Trust Fund an amount equal to the Servicing
Fee.
Additional
servicing compensation in the form of any Excess Liquidation Proceeds,
assumption fees, other ancillary income, late payment charges, all Prepayment
Interest Excess on any EMC Mortgage Loan, all income and gain net of any losses
realized from Permitted Investments with respect to funds in or credited to
the
Protected Account maintained by the Company shall be retained by the Company
to
the extent not required to be deposited in the Protected Account maintained
by
the Company pursuant to Section 5.02. The Company shall be required to pay
all
expenses incurred by it in connection with its servicing activities hereunder
(including payment of any premiums for hazard insurance, as required by Section
3.07) and shall not be entitled to reimbursement therefor except as specifically
provided in Section 5.02.
Section
3.14 REO
Property.
(a) In
the
event the Trust Fund acquires ownership of any REO Property in respect of any
related EMC Mortgage Loan, the deed or certificate of sale shall be issued
to
the Trustee, or to its nominee, on behalf of the related Certificateholders.
The
Company shall sell any such REO Property as expeditiously as possible and in
accordance with the provisions of this Agreement. Pursuant to its efforts to
sell such REO Property, the Company shall protect and conserve such REO Property
in the manner and to the extent required herein, in accordance with the REMIC
Provisions.
(b) The
Company shall deposit all funds collected and received in connection with the
operation of any REO Property in respect of any EMC Mortgage Loan into the
Protected Account maintained by the Company.
(c) The
Company and the Master Servicer (as applicable), upon the final disposition
of
any REO Property in respect of any EMC Mortgage Loan, shall be entitled to
reimbursement for any related unreimbursed Advances, unreimbursed Servicing
Advances, Servicing Fees and Master Servicing Fees from Liquidation Proceeds
received in connection with the final disposition of such REO Property;
provided, that any such unreimbursed Advances, unreimbursed Servicing Advances,
Servicing Fees or Master Servicing Fees as well as any unpaid Servicing Fees
and
Master Servicing Fees may be reimbursed or paid, as the case may be, prior
to
final disposition, out of any net rental income or other net amounts derived
from such REO Property.
Section
3.15 Liquidation
Reports.
Upon
the
foreclosure of any Mortgaged Property relating to an EMC Mortgage Loan or the
acquisition thereof by the Trust Fund pursuant to a deed-in-lieu of foreclosure,
the Company shall submit a liquidation report to the Master Servicer containing
such information as shall be mutually acceptable to the Company and the Master
Servicer with respect to such Mortgaged Property.
Section
3.16 Annual
Statement as to Compliance.
The
Company, the Master Servicer and the Securities Administrator shall each deliver
to the Securities Administrator and the Depositor, not later than March
15th
of each
calendar year beginning in 2007, an Officer’s Certificate (an “Annual Statement
of Compliance”) stating, as to each signatory thereof, that (i) a review of the
activities of each such party during the preceding calendar year and of its
performance under this Agreement and/or other applicable servicing agreement
has
been made under such officer’s supervision and (ii) to the best of such
officer’s knowledge, based on such review, each such party has fulfilled all of
its obligations under this Agreement and/or other applicable servicing agreement
in all material respects throughout such year, or, if there has been a failure
to fulfill any such obligation in any material respect, specifying each such
failure known to such officer and the nature and status thereof. Such Annual
Statement of Compliance shall contain no restrictions or limitations on its
use.
In the event that the Company, the Securities Administrator or the Master
Servicer has delegated any servicing responsibilities with respect to the
Mortgage Loans to a subservicer or subcontractor, such subservicer or
subcontractor shall be directed by such delegating party to deliver a similar
Annual Statement of Compliance (with respect to any related servicing
agreement), to the Securities Administrator and the Depositor as described
above
as and when required with respect to the Company, the Master Servicer and the
Securities Administrator.
Failure
of the Master Servicer to comply with this Section 3.16 (including with respect
to the time frames required in this Section) shall be deemed an Event of Default
with respect to such party, and the Trustee at the direction of the Depositor,
shall, in addition to whatever rights the Trustee may have under this Agreement
and at law or in equity or to damages, including injunctive relief and specific
performance, upon notice immediately terminate all of the rights and obligations
of the Master Servicer under this Agreement and in and to the Mortgage Loans
and
the proceeds thereof without compensating the Master Servicer for the same.
Failure of the Company to comply with this Section 3.16 (including with respect
to the timeframes required in this Section) shall be deemed a Company Default
and the Master Servicer shall, in addition to whatever rights the Master
Servicer may have under this Agreement and at law or in equity or to damages,
including injunctive relief and specific performance, upon notice immediately
terminate all of the rights and obligations of the Company under this Agreement
and in and to the Mortgage Loans and the proceeds thereof without compensating
the Company for the same. Failure of the Securities Administrator to comply
with
this Section 3.16 (including with respect to the time frames required in this
Section) shall be deemed a default and the Trustee at the direction of the
Depositor shall, in addition to whatever rights the Trustee may have under
this
Agreement and at law or in equity or to damages, including injunctive relief
and
specific performance, upon notice immediately terminate all of the rights and
obligations of the Securities Administrator under this Agreement and in and
to
the Mortgage Loans and the proceeds thereof without compensating the Securities
Administrator for the same. This paragraph shall supersede any other provision
in this Agreement or any other agreement to the contrary.
In
the
event the Company, the Master Servicer, the Securities Administrator or any
subservicer or subcontractor engaged by either such party is terminated or
resigns pursuant to the terms of the Agreement, or any other applicable
agreement in the case of a subservicer or subcontractor, as the case may be,
such party shall provide an Annual Statement of Compliance pursuant to this
Section 3.16 or to the related section of such other applicable agreement,
as
the case may be, as to the performance of its obligations with respect to the
period of time it was subject to this Agreement or any other applicable
agreement, as the case may be notwithstanding any such termination or
resignation.
Section
3.17 Assessments
of Compliance and Attestation Reports.
Pursuant
to Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation
AB,
the Company, the Master Servicer, the Securities Administrator and each
Custodian (each, an “Attesting Party”) at its own expense shall each deliver to
the Securities Administrator and the Depositor on or before March 15th
of
each
calendar year beginning in 2007, a report signed by an authorized officer of
such party regarding such Attesting Party’s Assessment of Compliance (an
“Assessment of Compliance”) with the Servicing Criteria during the preceding
calendar year. The Assessment of Compliance, as set forth in Regulation AB,
must
contain the following:
(a) A
statement by such officer of its responsibility for assessing compliance with
the Servicing Criteria applicable to the related Attesting Party;
(b) A
statement by such officer that such Attesting Party used the Servicing Criteria
attached as Exhibit O hereto, and which will also be attached to the Assessment
of Compliance, to assess compliance with the Servicing Criteria applicable
to
the related Attesting Party;
(c) An
assessment by such officer of the related Attesting Party’s compliance with the
applicable Servicing Criteria for the period consisting of the preceding
calendar year, including disclosure of any material instance of noncompliance
with respect thereto during such period, which assessment shall be based on
the
activities such Attesting Party performs with respect to asset-backed securities
transactions taken as a whole involving the related Attesting Party, that are
backed by the same asset type as the Mortgage Loans;
(d) A
statement that a registered public accounting firm has issued an Attestation
Report on the related Attesting Party’s Assessment of Compliance for the period
consisting of the preceding calendar year; and
(e) A
statement as to which of the Servicing Criteria, if any, are not applicable
to
such Attesting Party, which statement shall be based on the activities such
Attesting Party performs with respect to asset-backed securities transactions
taken as a whole involving such Attesting Party, that are backed by the same
asset type as the Mortgage Loans.
Such
report at a minimum shall address each of the Servicing Criteria specified
on
Exhibit O hereto which are indicated as applicable to the related Attesting
Party.
Notwithstanding
the foregoing, as to the Securities Administrator and any Custodian, an
Assessment of Compliance is not required to be delivered unless it is required
as part of a Form 10-K with respect to the Trust Fund.
On
or
before March 15th of each calendar year beginning in 2007, each Attesting Party
shall furnish to the Securities Administrator and the Depositor a report (an
“Attestation Report”) by a registered public accounting firm that attests to,
and reports on, the Assessment of Compliance made by the related Attesting
Party, as required by Rules 13a-18 and 15d-18 of the Exchange Act and Item
1122(b) of Regulation AB, which Attestation Report must be made in accordance
with standards for Attestation Reports issued or adopted by the Public Company
Accounting Oversight Board.
Each
of
the Company, the Securities Administrator and the Master Servicer shall cause
any subservicer and each subcontractor determined by it to be “participating in
the servicing function” within the meaning of Item 1122 of Regulation AB, to
deliver to the Securities Administrator and the Depositor an Assessment of
Compliance and Attestation Report as and when provided above along with an
indication of what Servicing Criteria are addressed in such
assessment.
Such
Assessment of Compliance, as to any subservicer, shall at a minimum address
each
of the Servicing Criteria specified on Exhibit O hereto which are indicated
as
applicable to any “primary servicer.” The Securities Administrator shall confirm
that the assessments, taken as a whole, address all of the Servicing Criteria
and taken individually address the Servicing Criteria for each party as set
forth on Exhibit O and notify the Depositor of any exceptions. Notwithstanding
the foregoing, as to any subcontractor (as defined in the related servicing
agreement), an Assessment of Compliance is not required to be delivered unless
it is required as part of a Form 10-K with respect to the Trust
Fund.
In
addition, for the avoidance of doubt and without duplication, the Company as
a
Servicer shall (and shall cause each subservicer engaged by it to) provide
to
the Depositor and the Securities Administrator information concerning the
following: (A) any Company Default hereunder and any subservicer event of
default under the terms of the related Subservicing Agreement, (B) any merger,
consolidation or sale of substantially all of the assets of the Company or,
to
the best of the Company’s knowledge, any such subservicer, and (C) the Company’s
entry into an agreement with a subservicer to perform or assist in the
performance of any of the Company’s obligations as Servicer.
In
addition, the Company as a Servicer, shall cause each subservicer engaged by
it
to provide the following information to the Depositor and the Securities
Administrator, to the extent applicable, within the timeframes that the Company
would otherwise have to provide such information:
(A) any
material modifications, extensions or waivers of pool asset terms, fees,
penalties or payments during the distribution period or that have cumulatively
become material over time (Item 1121(a)(11) of Regulation AB);
(B) information
regarding material breaches of pool asset representations or warranties or
transaction covenants (Item 1121(a)(12) of Regulation AB); and
(C) information
regarding new asset-backed securities issuances backed by the same pool assets,
any pool asset changes (such as, additions, substitutions or repurchases),
and
any material changes in origination, underwriting or other criteria for
acquisition or selection of pool assets (Item 1121(a)(14) of Regulation
AB).
Failure
of the Master Servicer or the Company, as applicable, to comply with this
Section 3.17 (including with respect to the timeframes required in this Section)
shall be deemed an Event of Default with respect to the Master Servicer and
a
Company Default with respect to the Company, and the Master Servicer or the
Trustee at the direction of the Depositor shall, in addition to whatever rights
the Master Servicer or the Trustee, as applicable, may have under this Agreement
and at law or in equity or to damages, including injunctive relief and specific
performance, upon notice immediately terminate all the rights and obligations
of
the applicable party under this Agreement and in and to the Mortgage Loans
and
the proceeds thereof without compensating the applicable party for the same.
This paragraph shall supersede any other provision in this Agreement or any
other agreement to the contrary.
In
the
event the Company, the Master Servicer, each Custodian, the Securities
Administrator or any subservicer or subcontractor engaged by any such party
is
terminated, assigns its rights and obligations under, or resigns pursuant to,
the terms of the Agreement, the related Custodial Agreement, or any other
applicable agreement in the case of a subservicer or subcontractor, as the
case
may be, such party shall provide an Assessment of Compliance and cause to be
provided an Attestation Report pursuant to this Section 3.17 or to the related
section of such other applicable agreement, as the case may be, notwithstanding
any such termination, assignment or resignation.
Section
3.18 Reports
Filed with Securities and Exchange Commission.
(a) (i)Within
15
days after each Distribution Date (subject to permitted exceptions under the
Exchange Act), the Securities Administrator shall, in accordance with industry
standards, prepare and file with the Commission via the Electronic Data
Gathering and Retrieval System (“XXXXX”), a Form 10-D, signed by the Master
Servicer, with a copy of the Monthly Statement to be furnished by the Securities
Administrator to the Certificateholders for such Distribution Date attached
thereto; provided that the Securities Administrator shall have received no
later
than seven (7) calendar days after the related Distribution Date, all
information required to be provided to the Securities Administrator as described
in clause (a)(ii) below. Any disclosure in addition to the Monthly Statement
that is required to be included on Form 10-D (“Additional Form 10-D Disclosure”)
shall
be
reported by the parties set forth on Exhibit P and by the Trustee to the
Securities Administrator and the Depositor and approved by the Depositor
pursuant to the paragraph immediately below, and the Securities Administrator
will have no duty or liability for any failure hereunder to determine or prepare
any Additional Form 10-D Disclosure absent such reporting (other than with
respect to when it is the reporting party as set forth in Exhibit P) and
approval.
(ii) (A)
Within seven (7) calendar days after the related Distribution Date, (i) the
parties set forth in Exhibit P and the Trustee shall be required to provide,
pursuant to section 3.18(a)(v) below, to the Securities Administrator and the
Depositor, to the extent known by a responsible officer thereof, in
XXXXX-compatible format, or in such other format as otherwise agreed upon by
the
Securities Administrator and the Depositor and such party, the form and
substance of any Additional Form 10-D Disclosure, if applicable, and (ii) the
Depositor will approve, as to form and substance, or disapprove, as the case
may
be, the inclusion of the Additional Form 10-D Disclosure on Form 10-D.
Subject
to the foregoing, the Securities Administrator has no duty under this Agreement
to monitor or enforce the performance by the other parties listed on Exhibit
P
or by the Trustee of their duties under this paragraph or to proactively solicit
or procure from such parties any Additional Form 10-D Disclosure information.
The Depositor will be responsible for any reasonable out-of-pocket expenses
incurred by the Securities
Administrator in connection with including any Additional Form 10-D Disclosure
on Form 10-D pursuant to this Section.
After
preparing the Form 10-D, the Securities Administrator shall forward
electronically a draft copy of the Form 10-D to the Depositor and the Master
Servicer for review. No later than two (2) Business Days prior to the 15th
calendar day after the related Distribution Date, a duly authorized officer
of
the Master Servicer shall sign the Form 10-D and return an electronic or fax
copy of such signed Form 10-D (with an original executed hard copy to follow
by
overnight mail) to the Securities Administrator. If a Form 10-D cannot be filed
on time or if a previously filed Form 10-D needs to be amended, the Securities
Administrator will follow the procedures set forth in Section 3.18(a)(vi).
Promptly (but no later than one (1) Business Day) after filing with the
Commission, the Securities Administrator will make available on its internet
website identified in Section 6.06 a final executed copy of each Form 10-D.
The
signing party at the Master Servicer can be contacted as set forth in Section
12.05. Form
10-D
requires the registrant to indicate (by checking "yes" or "no") that it "(1)
has
filed all reports required to be filed by Section 13 or 15(d) of the Exchange
Act during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such
filing requirements for the past 90 days. The Depositor shall notify the
Securities Administrator in writing, no later than the fifth calendar day after
the related Distribution Date with respect to the filing of a report on Form
10-D, if the answer to either question should be "no." The Securities
Administrator shall be entitled to rely on the representations made by the
Depositor in Section 2.04(vi) in preparing, executing and/or filing any such
Form 10-D.
(B) The
parties to this Agreement acknowledge that the performance by the Securities
Administrator of its duties under Sections 3.18(a)(i) and (vi) related to the
timely preparation and filing of Form 10-D is contingent upon such parties
strictly observing all applicable deadlines in the performance of their duties
under such Sections. The parties to this Agreement acknowledge that the
performance by each of the Master Servicer and the Securities Administrator
of
its duties under this Section 3.18(a)(ii) related to the timely preparation,
execution and filing of Form 10-D is also contingent upon the Servicers, the
Custodians and any subservicers or subcontractors strictly observing deadlines
no later than those set forth in this paragraph that are applicable to the
parties to this Agreement in the delivery to the Securities Administrator of
any
necessary Additional Form 10-D Disclosure pursuant to the related Servicing
Agreements, Custodial Agreements or any other applicable agreement. The
Securities Administrator shall have no liability for any loss, expense, damage
or claim arising out of or with respect to any failure to properly prepare
and/or timely file such Form 10-D, where such failure results from the failure
of any party hereto to deliver on a timely basis, any information needed by
the
Securities Administrator to prepare, arrange for execution or file such Form
10-D.
(iii) (A)
Within four (4) Business Days after the occurrence of an event requiring
disclosure on Form 8-K (each such event, a “Reportable Event”), the Securities
Administrator shall prepare and file, on behalf of the Trust, at the direction
of the Depositor, any Form 8-K, as required by the Exchange Act; provided that,
the Depositor shall file the initial Form 8-K in connection with the issuance
of
the Certificates. Any disclosure or information related to a Reportable Event
or
that is otherwise required to be included on Form 8-K (“Form 8-K Disclosure
Information”) shall be, pursuant to the paragraph immediately below, reported by
the parties set forth on Exhibit P and by the Trustee to the Securities
Administrator and the Depositor and directed and approved by the Depositor
pursuant to the following paragraph, and the Securities Administrator will
have
no duty or liability for any failure hereunder to determine or prepare any
Additional Form 8-K Disclosure absent such reporting (other than with respect
to
when it is the reporting party as set forth in Exhibit P) and
approval.
(B) For
so
long as the Trust is subject to the Exchange Act reporting requirements, (i)
no
later than 12:00 p.m. New York City time on the 2nd Business Day after the
occurrence of a Reportable Event the parties set forth in Exhibit P and the
Trustee shall be required pursuant to Section 3.18(a)(v) below to provide to
the
Securities Administrator and the Depositor, to the extent known by a responsible
officer thereof, in XXXXX-compatible format, or in such other form as otherwise
agreed upon by the Securities Administrator and the Depositor and such party,
the form and substance of any Form 8-K Disclosure Information, if applicable,
and (ii) the Depositor will approve, as to form and substance, or disapprove,
as
the case may be, the inclusion of the Form 8-K Disclosure Information on Form
8-K. Subject to the foregoing, the Securities Administrator has no duty under
this Agreement to monitor or enforce the performance by the other parties listed
on Exhibit P or by the Trustee of their duties under this paragraph or to
proactively solicit or procure from such parties any Form 8-K Disclosure
Information. The Depositor will be responsible for any reasonable out-of-pocket
expenses incurred by the Securities Administrator in connection with including
any Form 8-K Disclosure Information on Form 8-K pursuant to this Section.
(C) After
preparing the Form 8-K, the Securities Administrator shall forward
electronically a draft copy of the Form 8-K to the Depositor and the Master
Servicer for review. No later than the end of business New York City time on
the
3rd Business Day after the Reportable Event, a duly authorized officer of the
Master Servicer shall sign the Form 8-K and return an electronic or fax copy
of
such signed Form 8-K (with an original executed hard copy to follow by overnight
mail) to the Securities Administrator. If a Form 8-K cannot be filed on time
or
if a previously filed Form 8-K needs to be amended, the Securities Administrator
will follow the procedures set forth in Section 3.18(a)(vi). Promptly (but
no
later than one (1) Business Day) after filing with the Commission, the
Securities Administrator will, make available on its internet website identified
in Section 6.06 a final executed copy of each Form 8-K. The signing party at
the
Master Servicer can be contacted as set forth in Section 12.05. The parties
to
this Agreement acknowledge that the performance by the Securities Administrator
of its duties under this Section 3.18(a)(iii) related to the timely preparation
and filing of Form 8-K is contingent upon such parties strictly observing all
applicable deadlines in the performance of their duties under this Section
3.18(a)(iii). It is understood by the parties hereto that the performance by
each of the Master Servicer and the Securities Administrator of its duties
under
this Section 3.18(a)(iii) related to the timely preparation, execution and
filing of Form 8-K is also contingent upon the Servicers, the Custodians and
any
subservicers or subcontractors strictly observing deadlines no later than those
set forth in this paragraph that are applicable to the parties to this Agreement
in the delivery to the Securities Administrator of any necessary Form 8-K
Disclosure Information pursuant to the related Servicing Agreements, Custodial
Agreements or any other applicable agreement. The Securities Administrator
shall
have no liability for any loss, expense, damage or claim arising out of or
with
respect to any failure to properly prepare and/or timely file such Form 8-K,
where such failure results from the failure of any party hereto to deliver
on a
timely basis, any information needed by the Securities Administrator to prepare,
arrange for execution or file such Form 8-K.
(iv) (A)
On or
prior to the 90th
day
after the end of each fiscal year of the Trust or such earlier date as may
be
required by the Exchange Act (the “10-K Filing Deadline”) (it being understood
that the fiscal year for the Trust ends on December 31st of each year),
commencing in March 2007, the Securities Administrator shall prepare and file
on
behalf of the Trust a Form 10-K, in form and substance as required by the
Exchange Act. Each such Form 10-K shall include the following items, in each
case to the extent they have been delivered to the Securities Administrator
within the applicable timeframes set forth in this Agreement, (I) an Annual
Statement of Compliance for the Master Servicer, the Securities Administrator,
the Company, the Servicers and any subservicer or subcontractor (to the extent
Regulation AB requires the Annual Statement of Compliance of any such
subservicer and subcontractor to be attached to Form 10-K), as described under
Section 3.16, (II)(A) the Assessment of Compliance with Servicing Criteria
for
the Master Servicer, the Company, the Servicers, each subservicer and
subcontractor participating in the servicing function, the Securities
Administrator and the Custodian, as described under Section 3.17, and (B) if
the
Assessment of Compliance of the Master Servicer, the Company, the Servicers,
each subservicer and subcontractor, the Securities Administrator or the
Custodian described under Section 3.17 identifies any material instance of
noncompliance, disclosure identifying such instance of noncompliance, or if
the
Assessment of Compliance of the Master Servicer, the Servicers, the subservicer,
the subcontractor, the Securities Administrator or the Custodian described
under
Section 3.17 is not included as an exhibit to such Form 10-K, disclosure that
such report is not included and an explanation why such report is not included,
(III)(A) the registered public accounting firm Attestation Report for the Master
Servicer, the subservicer, the subcontractor, the Company, the Servicers, the
Securities Administrator and the Custodian, as described under Section 3.17,
and
(B) if any registered public accounting firm Attestation Report described under
Section 3.17 identifies any material instance of noncompliance, disclosure
identifying such instance of noncompliance, or if any such registered public
accounting firm Attestation Report is not included as an exhibit to such Form
10-K, disclosure that such report is not included and an explanation why such
report is not included, and (IV) a Xxxxxxxx-Xxxxx Certification (“Xxxxxxxx-Xxxxx
Certification”) as described in this Section 3.18 (a)(iv)(D) below. Any
disclosure or information in addition to (I) through (IV) above that is required
to be included on Form 10-K (“Additional Form 10-K Disclosure”) shall be
reported by the parties set forth on Exhibit P and by the Trustee to the
Securities Administrator and the Depositor and, pursuant to the paragraph
immediately below, approved by the Depositor, and the Securities Administrator
will have no duty or liability for any failure hereunder to determine or prepare
any Additional Form 10-K Disclosure absent such reporting (other than with
respect to when it is the reporting party as set forth in Exhibit P) and
approval.
(B) No
later
than March 15th of each year that the Trust is subject to the Exchange Act
reporting requirements, commencing in 2007, (i) the parties set forth in Exhibit
P and the Trustee shall be required to provide pursuant to Section 3.18(a)(v)
below to the Securities Administrator and the Depositor, to the extent known,
in
XXXXX-compatible format, or in such other format as otherwise agreed upon by
the
Securities Administrator and the Depositor and such party, the form and
substance of any Additional Form 10-K Disclosure, if applicable, and (ii) the
Depositor will approve, as to form and substance, or disapprove, as the case
may
be, the inclusion of the Additional Form 10-K Disclosure on Form 10-K. Subject
to the foregoing, the Securities Administrator has no duty under this Agreement
to monitor or enforce the performance by the other parties listed on Exhibit
P
and the Trustee of their duties under this paragraph or to proactively solicit
or procure from such parties any Additional Form 10-K Disclosure information.
The Depositor will be responsible for any reasonable out-of-pocket expenses
incurred by the Securities Administrator in connection with including any
Additional Form 10-K Disclosure on Form 10-K pursuant to this
Section.
(C) After
preparing the Form 10-K, the Securities Administrator shall forward
electronically a draft copy of the Form 10-K to the Depositor and the Master
Servicer for review. Form 10-K requires the registrant to indicate (by checking
"yes" or "no") that it (1) has filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports), and
(2)
has been subject to such filing requirements for the past 90 days. The Depositor
shall notify the Securities Administrator in writing, no later than the 15th
calendar day of March in any year in which the Trust is subject to the reporting
requirements of the Exchange Act, if the answer to either question should be
"no." The Securities Administrator shall be entitled to rely on the
representations made by the Depositor in Section 2.04(vi) in preparing,
executing and/or filing any such Form 10-K. No later than 12:00 p.m. New York
City time on the 4th Business Day prior to the 10-K Filing Deadline, a senior
officer of the Master Servicer in charge of the master servicing function shall
sign the Form 10-K and return an electronic or fax copy of such signed Form
10-K
(with an original executed hard copy to follow by overnight mail) to the
Securities Administrator. If a Form 10-K cannot be filed on time or if a
previously filed Form 10-K needs to be amended, the Securities Administrator
will follow the procedures set forth in Section 3.18(a)(vi). Promptly (but
no
later than one (1) Business Day) after filing with the Commission, the
Securities Administrator will make available on its internet website identified
in Section 6.06 a final executed copy of each Form 10-K. The signing party
at
the Master Servicer can be contacted as set forth in Section 12.05. The parties
to this Agreement acknowledge that the performance by the Securities
Administrator of its duties under Section 3.18(a)(iv) related to the timely
preparation and filing of Form 10-K is contingent upon such parties strictly
observing all applicable deadlines in the performance of their duties under
such
Section and Section 3.16 and Section 3.17. It is understood by the parties
hereto that the performance by the Master Servicer and the Securities
Administrator of its duties under this Section 3.18(a)(iv) related to the timely
preparation, execution and filing of Form 10-K is also contingent upon the
Servicers, the Custodians and any subservicer or subcontractor strictly
observing deadlines no later than those set forth in this paragraph that are
applicable to the parties to this Agreement in the delivery to the Securities
Administrator of any necessary Additional Form 10-K Disclosure, any annual
statement of compliance and any Assessment of Compliance and attestation
pursuant to the related Servicing Agreements, the Custodial Agreements or any
other applicable agreement. The Securities Administrator shall have no liability
for any loss, expense, damage or claim arising out of or with respect to any
failure to properly prepare and/or timely file such Form 10-K, where such
failure results from the failure of any party hereto to deliver on a timely
basis, any information needed by the Securities Administrator to prepare,
arrange for execution or file such Form 10-K.
(D) Each
Form
10-K shall include a certification (the “Xxxxxxxx-Xxxxx Certification”) required
to be included therewith pursuant to the Xxxxxxxx-Xxxxx Act. The Securities
Administrator and the Company shall, and each such party shall cause any
subservicer or subcontractor engaged by it to, provide to the Person who signs
the Xxxxxxxx-Xxxxx Certification (the “Certifying Person”), by March 15 of each
year in which the Trust is subject to the reporting requirements of the Exchange
Act and otherwise within a reasonable period of time upon request, a
certification (a “Back-Up Certification”), in the form attached hereto as
Exhibit M upon which the Certifying Person, the entity for which the Certifying
Person acts as an officer, and such entity’s officers, directors and Affiliates
(collectively with the Certifying Person, “Certification Parties”) can
reasonably rely; provided, however, that the Securities Administrator and the
Company shall not be required to undertake an analysis of any accountant’s
report attached as an exhibit to the Form 10-K. The senior officer of the Master
Servicer in charge of the master servicing function shall serve as the
Certifying Person on behalf of the Trust. Such officer of the Certifying Person
can be contacted as set forth in Section 12.05. In the event the Securities
Administrator is terminated or resigns pursuant to the terms of this Agreement
or any subcontractor or subservicer is terminated pursuant to the related
servicing agreement, the Securities Administrator, subcontractor or subservicer,
as applicable, shall provide a Back-Up Certification to the Certifying Person
pursuant to this Section 3.18(a)(iv) with respect to the period of time it
was
subject to this Agreement or the related servicing agreement, as applicable.
Notwithstanding the foregoing, (i) the Master Servicer and the Securities
Administrator shall not be required to deliver a Back-Up Certification to each
other if both are the same Person and the Master Servicer is the Certifying
Person and (ii) the Master Servicer shall not be obligated to sign the
Xxxxxxxx-Xxxxx Certification in the event that it does not receive any Back-Up
Certification required to be furnished to it pursuant to this section or any
Servicing Agreement or Custodial Agreement.
(v) With
respect to any Additional Form 10-D Disclosure, Additional Form 10-K Disclosure
or any Form 8-K Disclosure Information (collectively, the “Additional
Disclosure”) relating to the Trust Fund in the form attached hereto as Exhibit
Q, the Securities Administrator’s obligation to include such Additional
Information in the applicable Exchange Act report is subject to receipt from
the
entity that is indicated in Exhibit P as the responsible party for providing
that information, if other than the Securities Administrator, as and when
required as described in Section 3.18(a)(i) through (iv) above. Each of the
Master Servicer, Custodian, Seller, Company and the Depositor hereby agree
to
notify and provide (to the extent known) to the Securities Administrator and
the
Depositor all Additional Disclosure relating to the Trust Fund, with respect
to
which such party is indicated in Exhibit P as the responsible party for
providing that information. Within
five Business Days prior to each Distribution Date of each year that the Trust
is subject to the Exchange Act reporting requirements, the Depositor shall
make
available to the Securities
Administrator the
Significance Estimate and the Securities Administrator shall use such
information to calculate the Significance Percentage. The
Securities Administrator shall provide the Significance Percentage to the
Depositor by the later of the Distribution Date or (3) three Business Days
after
the receipt of the Significance Estimate from the Depositor.
If the
Significance Percentage meets either of the threshold levels detailed in Item
1115(b)(1) or 1115(b)(2) of Regulation AB, the Securities Administrator shall
deliver written notification to the Depositor and the Swap Provider to that
effect. The
Securities Administrator shall request and the Depositor shall obtain from
the
Swap Provider any information required under Regulation AB to the extent
required under the Swap Agreement. The Depositor shall be obligated to provide
to the Securities Administrator (no later than, in the case of Form 10-D, the
seventh calendar day after the Distribution Date and in the case of Form 10-K,
March 15th in any year in which a Form 10-K is filed for the Trust) any
information that may be required to be included in any Form 10-D, Form 8-K
or
Form 10-K or written notification instructing the Securities Administrator
that
such Additional Disclosure regarding the Swap Provider is not necessary for
such
Distribution Date.
So
long
as the Depositor is subject to the filing requirements of the Exchange Act
with
respect to the Trust Fund, the Trustee shall notify the Securities Administrator
and the Depositor of any bankruptcy or receivership with respect to the Trustee
or of any proceedings of the type described under Item 1117 of Regulation AB
that have occurred as of the end of the related Due Period, together with a
description thereof, no later than the date on which such information is
required to be reported to the Securities Administrator and the Depositor by
the
other parties hereto as set forth under this Section 3.18. In addition, the
Trustee shall notify the Securities Administrator and the Depositor of (i)
any
affiliations or relationships that develop after the Closing Date between the
Trustee and the Depositor, the Seller, the Securities Administrator, the Master
Servicer or the Custodian of the type described under Item 1119 of Regulation
AB, and (ii) the occurrence of an Event of Default (with respect to the Master
Servicer) actually
known to a Responsible Officer of the Trustee
together, in each case, with a description thereof, no later than the date
on
which such information is required to be reported to the Securities
Administrator and the Depositor by the other parties hereto as set forth under
this Section 3.18. Any notice required to be given by the Trustee to the
Securities Administrator and the Depositor pursuant to this paragraph shall
be
accompanied by an Additional Disclosure Notification form attached hereto as
Exhibit Q and shall be submitted in XXXXX-compatible format. Should
the identification of any of the Depositor, the Seller, the Securities
Administrator, the Master Servicer or the Custodian change, the Depositor shall
promptly notify the Trustee.
(vi) (A)
On or
prior to January 30 of the first year in which the Securities Administrator
is
able to do so under applicable law, the Securities Administrator shall prepare
and file a Form 15 relating to the automatic suspension of reporting in respect
of the Trust under the Exchange Act.
(B) In
the
event that the Securities Administrator is unable to timely file with the
Commission all or any required portion of any Form 8-K, 10-D or 10-K required
to
be filed by this Agreement because required disclosure information was either
not delivered to it or delivered to it after the delivery deadlines set forth
in
this Agreement or for any other reason, the Securities Administrator will
promptly notify the Depositor and the Master Servicer. In the case of Form
10-D
and 10-K, the parties hereto will cooperate to prepare and file a Form 12b-25
and a 10-D/A and 10-K/A as applicable, pursuant to Rule 12b-25 of the Exchange
Act. In the case of Form 8-K, the Securities Administrator will, upon receipt
of
all required Form 8-K Disclosure Information and upon the approval and direction
of the Depositor, include such disclosure information on the next Form 10-D.
In
the event that any previously filed Form 8-K, 10-D or 10-K needs to be amended,
the Securities Administrator will notify the Depositor and the Master Servicer
and the parties hereto will cooperate to prepare any necessary 8-K/A, 10-D/A
or
10-K/A. Any Form 15, Form 12b-25 or any amendment to Form 8-K, Form 10-D or
Form
10-K shall be signed by the appropriate officer of the Master Servicer. The
parties hereto acknowledge that the performance by the Securities Administrator
of its duties under this Section 3.18(a)(vi) related to the timely preparation
and filing of Form 15, a Form 12b-25 or any amendment to Form 8-K, Form 10-D
or
Form 10-K is contingent upon such parties performing their duties under this
Section. The Securities Administrator shall have no liability for any loss,
expense, damage, claim arising out of or with respect to any failure to properly
prepare and/or timely file any such Form 15, Form 12b-25 or any amendments
to
Form 8-K, Form 10-D or Form 10-K, where such failure results from the failure
of
any party hereto to deliver on a timely basis, any information needed by the
Securities Administrator to prepare, arrange for execution or file such Form
15,
Form 12b-25 or any amendments to Forms 8-K, Form 10-D or Form 10-K.
The
parties hereto agree to promptly furnish to the Securities Administrator, from
time to time upon request, such further information, reports and financial
statements within its control or possession related to this Agreement and the
Mortgage Loans as the Securities Administrator reasonably deems appropriate
to
prepare and file all necessary reports with the Commission. The Securities
Administrator shall have no responsibility to file any items other than those
specified in this Section 3.18; provided, however, the Securities Administrator
shall cooperate with the Depositor in connection with any additional filings
with respect to the Trust Fund as the Depositor deems necessary under the
Exchange Act. Copies of all reports filed by the Securities Administrator under
the Exchange Act shall be sent to: the Depositor c/o Bear, Xxxxxxx & Co.
Inc., Attn: Managing Director Analysis and Control, Xxx Xxxxxxxxx Xxxxxx Xxxxx,
Xxxxxxxx, Xxx Xxxx 00000-0000. Fees and expenses incurred by the Securities
Administrator in connection with this Section 3.18 shall not be reimbursable
from the Trust Fund. The Depositor shall be responsible for any reasonable
fees
and expenses assessed or incurred by the Securities Administrator to the extent
set forth in this Section 3.18.
(b) The
Securities Administrator shall indemnify and hold harmless each of the Company,
the Depositor and the Master Servicer (if the Master Servicer is unaffiliated
with the Securities Administrator) 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 a breach of the Securities
Administrator’s obligations under Sections 3.16, 3.17 and 3.18 or the Securities
Administrator’s negligence, bad faith or willful misconduct in connection
therewith. In addition, the Securities Administrator shall indemnify and hold
harmless the Depositor and the Master Servicer (if the Master Servicer is
unaffiliated with the Securities Administrator) and each of their 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 (i) any untrue
statement or alleged untrue statement of any material fact contained in any
Back-Up Certification, the Annual Statement of Compliance, the Assessment of
Compliance, any Additional Disclosure or other information provided by the
Securities Administrator pursuant to Section 3.16, 3.17 and 3.18 (the
“Securities Administrator Information”), or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in
which
they were made, not misleading; provided, by way of clarification, that clause
(ii) of this paragraph shall be construed solely by reference to the Securities
Administrator Information and not to any other information communicated in
connection with the Certificates, without regard to whether the Securities
Administrator Information or any portion thereof is presented together with
or
separately from such other information.
The
Depositor shall indemnify and hold harmless each of the Company, the Securities
Administrator and the Master Servicer and their 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 a breach of the obligations of the
Depositor under Sections 3.16, 3.17 and 3.18 or the Depositor’s negligence, bad
faith or willful misconduct in connection therewith.
The
Master Servicer shall indemnify and hold harmless each of the Company, the
Securities Administrator (if the Securities Administrator is unaffiliated with
the Master Servicer) and the Depositor 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 a breach of the
obligations of the Master Servicer under Sections 3.16, 3.17 and 3.18 or the
Master Servicer’s negligence, bad faith or willful misconduct in connection
therewith. In addition, the Master Servicer shall indemnify and hold harmless
the Depositor and each of its 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 (i) any untrue statement or alleged untrue
statement of any material fact contained in any Annual Statement of Compliance,
any Assessment of Compliance, any Attestation Report, any Additional Disclosure
or other information provided by the Master Servicer pursuant to Section 3.16,
3.17 and 3.18 (the “Master Servicer Information”), or (ii) the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances
in
which they were made, not misleading; provided, by way of clarification, that
clause (ii) of this paragraph shall be construed solely by reference to the
Master Servicer Information and not to any other information communicated in
connection with the Certificates, without regard to whether the Master Servicer
Information or any portion thereof is presented together with or separately
from
such other information.
The
Company shall indemnify and hold harmless each of the Depositor, the Securities
Administrator and the Master Servicer 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 a breach of the
obligations of the Company under Sections 3.16, 3.17 and 3.18 or the Company’s
negligence, bad faith or willful misconduct in connection therewith. In
addition, the Company shall indemnify and hold harmless each of the Depositor,
the Securities Administrator and the Master Servicer 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
(i)
any untrue statement or alleged untrue statement of any material fact contained
in any Back-Up Certification, the Annual Statement of Compliance, the Assessment
of Compliance, any Attestation Report, any Additional Disclosure or other
information provided by or on behalf of the Company or on behalf of any
subservicer or subcontractor of the Company pursuant to Section 3.16, 3.17
and
3.18 (the “Company Information”), or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make
the statements therein, in light of the circumstances in which they were made,
not misleading; provided, by way of clarification, that clause (ii) of this
paragraph shall be construed solely by reference to the Company Information
and
not to any other information communicated in connection with the Certificates,
without regard to whether the Company Information or any portion thereof is
presented together with or separately from such other information.
If
the
indemnification provided for herein is unavailable or insufficient to hold
harmless the Depositor, the Securities Administrator or the Master Servicer,
as
applicable, then the defaulting party, in connection with any conduct for which
it is providing indemnification for under this Section 3.18(b), agrees that
it
shall contribute to the amount paid or payable by the other parties as a result
of the losses, claims, damages or liabilities of the other party in such
proportion as is appropriate to reflect the relative fault and the relative
benefit of the respective parties.
The
indemnification provisions set forth in this Section 3.18(b) shall survive
the
termination of this Agreement or the termination of any party to this
Agreement.
(c) Nothing
shall be construed from the foregoing subsections (a) and (b) to require the
Securities Administrator or any officer, director or Affiliate thereof to sign
any Form 10-K or any certification contained therein. Furthermore, the inability
of the Securities Administrator to file a Form 10-K as a result of the lack
of
required information as set forth in Section 3.18(a) or required signatures
on
such Form 10-K or any certification contained therein shall not be regarded
as a
breach by the Securities Administrator of any obligation under this
Agreement.
(d) Notwithstanding
the provisions of Section 11.01, this Section 3.18 may be amended without the
consent of the Certificateholders.
(e) Any
report, notice or notification to be delivered by the Company, the Master
Servicer or the Securities Administrator to the Depositor pursuant to this
Section 3.18, may be delivered via facsimile to Reg AB Compliance Manager,
via
email to XxxXXXxxxxxxxxxxxx@xxxx.xxx or, in the case of a notification,
telephonically by calling Reg AB Compliance Manager at
000-000-0000.
Section
3.19 Intention
of the Parties and Interpretation.
Each
of
the parties acknowledges and agrees that the purpose of Sections 3.16, 3.17
and
3.18 of this Agreement is to facilitate compliance by the Seller, the Depositor,
the Master Servicer and the Securities Administrator with the provisions of
Regulation AB promulgated by the SEC under the 1934 Act (17 C.F.R. §§ 229.1100 -
229.1123), as such may be amended from time to time and subject to clarification
and interpretive advice as may be issued by the staff of the SEC from time
to
time. Therefore, each of the parties agrees that (a) the obligations of the
parties hereunder shall be interpreted in such a manner as to accomplish that
purpose, (b) the parties’ obligations hereunder will be supplemented and
modified as necessary to be consistent with any such amendments, interpretive
advice or guidance, convention or consensus among active participants in the
asset-backed securities markets, advice of counsel, or otherwise in respect
of
the requirements of Regulation AB, (c) the parties shall comply with requests
made by the Sponsor, the Depositor or other applicable parties hereto for
delivery of additional or different information as the Securities Administrator,
the Master Servicer, the Sponsor or the Depositor may determine in good faith
is
necessary to comply with the provisions of Regulation AB, and (d) no amendment
of this Agreement shall be required to effect any such changes in the parties’
obligations as are necessary to accommodate evolving interpretations of the
provisions of Regulation AB.
ARTICLE
IV
MASTER
SERVICING OF MORTGAGE LOANS BY MASTER SERVICER
Section
4.01 Master
Servicer.
The
Master Servicer shall, beginning on the Closing Date, supervise, monitor and
oversee the obligation of the Company and the related Servicer to service and
administer their respective Mortgage Loans in accordance with the terms of
this
Agreement and the related Servicing Agreement, respectively and shall have
full
power and authority to do any and all things which it may deem necessary or
desirable in connection with such master servicing. In performing its
obligations hereunder, the Master Servicer shall act in a manner consistent
with
Accepted Master Servicing Practices. Furthermore, the Master Servicer shall
oversee and consult with the Company and the related Servicer as necessary
from
time-to-time to carry out the Master Servicer’s obligations hereunder, shall
receive and review certain reports, information and other data provided to
the
Master Servicer by the Company and the related Servicer and shall enforce the
obligations, conditions and covenants of the Company and related Servicer to
the
extent set forth in this Agreement and the related Servicing Agreement,
respectively. The Master Servicer shall monitor the Company and the related
Servicer’s servicing activities with respect to each related Mortgage Loan,
reconcile the results of such monitoring with such information described in
the
previous sentence and received by the Master Servicer on a monthly basis and
coordinate corrective adjustments to the Company’s, the Servicer’s and Master
Servicer’s records, and based on such reconciled and corrected information, the
Master Servicer shall provide such information to the Securities Administrator
as shall be necessary in order for it to prepare the statements specified in
Section 6.06 and any other information and statements required hereunder. The
Master Servicer shall reconcile the results of its Mortgage Loan monitoring
with
the actual remittances of the Company and each Servicer pursuant to this
Agreement and the related Servicing Agreement, respectively. The Master Servicer
shall be entitled to conclusively rely on the Mortgage Loan data provided by
the
Company and the related Servicer and shall have no liability for any errors
in
such Mortgage Loan data.
The
Master Servicer, the Trustee and the Securities Administrator shall provide
access to the records and documentation in possession of the Master Servicer,
the Trustee or the Securities Administrator regarding the related Mortgage
Loans
and REO Property to the Certificateholders, the FDIC, and the supervisory agents
and examiners of the FDIC, such access being afforded only upon reasonable
prior
written request and during normal business hours at the office of the Master
Servicer, the Trustee or the Securities Administrator; provided, however, that,
unless otherwise required by law, neither the Master Servicer, the Trustee
nor
the Securities Administrator shall be required to provide access to such records
and documentation if the provision thereof would violate the legal right to
privacy of any Mortgagor. The Master Servicer, the Trustee and the Securities
Administrator shall allow representatives of the above entities to photocopy
any
of the records and documentation and shall provide equipment for that purpose
at
a charge that covers the Master Servicer’s, the Trustee’s or the Securities
Administrator’s actual costs.
The
Trustee shall execute and deliver to the Company, the related Servicer or the
Master Servicer, as applicable, any court pleadings, requests for trustee’s sale
or other documents necessary or desirable to (i) the foreclosure or trustee’s
sale with respect to a Mortgaged Property; (ii) any legal action brought to
obtain judgment against any Mortgagor on the Mortgage Note or security
instrument; (iii) obtain a deficiency judgment against the Mortgagor; or (iv)
enforce any other rights or remedies provided by the Mortgage Note or security
instrument or otherwise available at law or equity.
Section
4.02 Monitoring
of Company and Servicers.
(a) In
the
review of the Company’s and the related Servicer’s activities, the Master
Servicer may rely upon the Annual Statement of Compliance of the Company and
the
related Servicer with regard to such Person’s compliance with the terms of this
Agreement or the related Servicing Agreement; provided that no such reliance
will relieve the Master Servicer of its obligations pursuant to this Agreement.
In the event that the Master Servicer, in its judgment, determines that the
Company or the related Servicer should be terminated in accordance with this
Agreement or the related Servicing Agreement, or that a notice should be sent
pursuant to this Agreement or the related Servicing Agreement with respect
to
the occurrence of an event that, unless cured, would constitute grounds for
such
termination, the Master Servicer shall notify the Depositor and the Trustee
thereof and the Master Servicer shall issue such notice or take such other
action as it deems appropriate.
(b) The
Master Servicer, for the benefit of the Trustee and the Certificateholders,
shall enforce the obligations of the Company under this Agreement and of the
related Servicer under the related Servicing Agreement, and shall, in the event
that the Company or the related Servicer fails to perform its obligations in
accordance with this Agreement or the related Servicing Agreement, subject
to
the preceding paragraph, terminate the rights and obligations of such Person
thereunder and act as servicer of the related Mortgage Loans or to instruct
the
Trustee to enter into a new Servicing Agreement with a successor Servicer
selected by the Master Servicer; provided, however, it is understood and
acknowledged by the parties hereto that there shall be a period of transition
(not to exceed 90 days) before the actual servicing functions can be fully
transferred to such successor Servicer; provided further, if the Servicer or
the
Company has failed to advance or failed to make a payment so that the Master
Servicer has had to advance its own funds, then the Master Servicer may
terminate the Servicer or the Company. Such enforcement, including, without
limitation, the legal prosecution of claims, termination of the related
Servicing Agreement and the pursuit of other appropriate remedies, shall be
in
such form and carried out to such an extent and at such time as the Master
Servicer, in its good faith business judgment, would require were it the owner
of the related Mortgage Loans. The Master Servicer shall pay the costs of such
enforcement at its own expense, subject to its right of reimbursement pursuant
to the provisions of this Agreement or the related Servicing Agreement, provided
that the Master Servicer shall not be required to prosecute or defend any legal
action except to the extent that the Master Servicer shall have received
reasonable indemnity for its costs and expenses in pursuing such
action.
(c) To
the
extent that the costs and expenses of the Master Servicer related to any
termination of the Company or the related Servicer, appointment of a successor
Servicer or the transfer and assumption of servicing by the Master Servicer
with
respect to this Agreement or the related Servicing Agreement (including, without
limitation, (i) all legal costs and expenses and all due diligence costs and
expenses associated with an evaluation of the potential termination of the
Company or the related Servicer as a result of an alleged or actual breach
of
contract or an event of default by such Person and (ii) all costs and expenses
associated with the complete transfer of servicing, including all servicing
files and all servicing data and the completion, correction or manipulation
of
such servicing data as may be required by the successor servicer to correct
any
errors or insufficiencies in the servicing data or otherwise to enable the
successor servicer to service the Mortgage Loans in accordance with this
Agreement or the related Servicing Agreement) are not fully and timely
reimbursed by the Company or the terminated Servicer, the Master Servicer shall
be entitled to reimbursement of such costs and expenses from the Master Servicer
Collection Account.
(d) The
Master Servicer shall require the Company and the related Servicer to comply
with the remittance requirements and other obligations set forth in this
Agreement or the related Servicing Agreement, as applicable.
(e) If
the
Master Servicer acts as a servicer, it will not assume liability for the
representations and warranties of the Company or the related Servicer, if any,
that it replaces.
Section
4.03 Fidelity
Bond.
The
Master Servicer, at its expense, shall (i) maintain in effect a blanket fidelity
bond and an errors and omissions insurance policy, affording coverage with
respect to all directors, officers, employees and other Persons acting on such
Master Servicer’s behalf, and covering errors and omissions in the performance
of the Master Servicer’s obligations hereunder or (ii) self insure if LaSalle
maintains with any Rating Agency the equivalent of a long term unsecured debt
rating of “A”. The errors and omissions insurance policy and the fidelity bond
referred to in (i) above shall be in such form and amount generally acceptable
for entities serving as master servicers.
Section
4.04 Power
to
Act; Procedures.
The
Master Servicer shall master service the Mortgage Loans and shall have full
power and authority, subject to the REMIC Provisions and the provisions of
Article XI hereof, to do any and all things that it may deem necessary or
desirable in connection with the master servicing and administration of the
Mortgage Loans, including but not limited to the power and authority (i) to
execute and deliver, on behalf of the Certificateholders, the Trustee and the
Securities Administrator, customary consents or waivers and other instruments
and documents, (ii) to consent to transfers of any Mortgaged Property and
assumptions of the Mortgage Notes and related Mortgages, (iii) to collect any
Insurance Proceeds and Liquidation Proceeds, and (iv) to effectuate foreclosure
or other conversion of the ownership of the Mortgaged Property securing any
Mortgage Loan, in each case, in accordance with the provisions of this Agreement
and the related Servicing Agreement, as applicable; provided, however, that
the
Master Servicer shall not (and, consistent with its responsibilities under
Section 4.02, shall not permit the Company or the related Servicer to) knowingly
or intentionally take any action, or fail to take (or fail to cause to be taken)
any action reasonably within its control and the scope of duties more
specifically set forth herein, that, under the REMIC Provisions, if taken or
not
taken, as the case may be, would cause REMIC I, REMIC II, REMIC III, REMIC
IV or
REMIC V to fail to qualify as a REMIC or result in the imposition of a tax
upon
the Trust Fund (including but not limited to the tax on prohibited transactions
as defined in Section 860F(a)(2) of the Code and the tax on contributions to
a
REMIC set forth in Section 860G(d) of the Code) unless the Master Servicer
has
received an Opinion of Counsel (but not at the expense of the Master Servicer)
to the effect that the contemplated action, or failure to take action, will
not
cause REMIC I, REMIC II, REMIC III, REMIC IV or REMIC V to fail to qualify
as a
REMIC or result in the imposition of a tax upon REMIC I, REMIC II, REMIC III,
REMIC IV or REMIC V, as the case may be.
The
Trustee shall execute and deliver such other documents, as the Master Servicer
may request, to enable the Master Servicer to master service and administer
the
Mortgage Loans and carry out its duties hereunder, in each case in accordance
with Accepted Master Servicing Practices (and the Trustee shall have no
liability for misuse of any such powers of attorney by the Master Servicer,
the
Company or the related Servicer). If the Master Servicer or the Trustee has
been
advised that it is likely that the laws of the state in which action is to
be
taken prohibit such action if taken in the name of the Trustee or that the
Trustee would be adversely affected under the “doing business” or tax laws of
such state if such action is taken in its name, the Master Servicer shall join
with the Trustee in the appointment of a co-trustee pursuant to Section 10.11
hereof. In the performance of its duties hereunder, the Master Servicer shall
be
an independent contractor and shall not, except in those instances where it
is
taking action in the name of the Trustee, be deemed to be the agent of the
Trustee.
Section
4.05 Due-on-Sale
Clauses; Assumption Agreements.
To
the
extent provided in this Agreement or the related Servicing Agreement, to the
extent Mortgage Loans contain enforceable due-on-sale clauses, the Master
Servicer shall enforce
the obligation of
the
Company and the related Servicer to enforce such clauses in accordance with
this
Agreement or the related Servicing Agreement. If applicable law prohibits the
enforcement of a due-on-sale clause or such clause is otherwise not enforced
in
accordance with this Agreement or the related Servicing Agreement, and, as
a
consequence, a Mortgage Loan is assumed, the original Mortgagor may be released
from liability in accordance with this Agreement or the related Servicing
Agreement.
Section
4.06 Documents,
Records and Funds in Possession of Master Servicer, Company and Servicer To
Be
Held for Trustee.
(a) The
Master Servicer shall transmit and the Company or the related Servicer (to
the
extent required by this Agreement or the related Servicing Agreement) shall
transmit to the Trustee or Custodian such documents and instruments coming
into
the possession of such Person from time to time as are required by the terms
hereof, or in the case of the related Servicer, the related Servicing Agreement,
to be delivered to the Trustee or Custodian. Any funds received by the Master
Servicer, the Company or by the related Servicer in respect of any Mortgage
Loan
or which otherwise are collected by the Master Servicer, the Company or by
the
related Servicer as Liquidation Proceeds or Insurance Proceeds in respect of
any
Mortgage Loan shall be held for the benefit of the Trustee and the
Certificateholders subject to the Master Servicer’s right to retain or withdraw
from the Master Servicer Collection Account, the Master Servicing Compensation
and other amounts provided in this Agreement, and to the right of the Company
and the related Servicer to retain its Servicing Fee and other amounts as
provided in this Agreement or the related Servicing Agreement. The Master
Servicer shall, and (to the extent provided in this Agreement or the related
Servicing Agreement) shall enforce the obligation of the Company and the related
Servicer to, provide access to information and documentation regarding the
Mortgage Loans to the Trustee, and their respective agents and accountants
at
any time upon reasonable request and during normal business hours, and to
Certificateholders that are savings and loan associations, banks or insurance
companies, the Office of Thrift Supervision, the FDIC and the supervisory agents
and examiners of such Office and Corporation or examiners of any other federal
or state banking or insurance regulatory authority if so required by applicable
regulations of the Office of Thrift Supervision or other regulatory authority,
such access to be afforded without charge but only upon reasonable request
in
writing and during normal business hours at the offices of the Master Servicer
designated by it. In fulfilling such a request the Master Servicer shall not
be
responsible for determining the sufficiency of such information.
(b) All
Mortgage Files and funds collected or held by, or under the control of, the
Master Servicer, in respect of any Mortgage Loans, whether from the collection
of principal and interest payments or from Liquidation Proceeds or Insurance
Proceeds, shall be held by the Master Servicer for and on behalf of the Trustee
and the Certificateholders and shall be and remain the sole and exclusive
property of the Trustee; provided, however, that the Master Servicer, the
Company and the related Servicer shall be entitled to setoff against, and deduct
from, any such funds any amounts that are properly due and payable to the Master
Servicer or such Servicer under this Agreement or the related Servicing
Agreement.
Section
4.07 Presentment
of Claims and Collection of Proceeds.
The
Master Servicer shall (to the extent provided in this Agreement and the
Servicing Agreement) enforce the obligation of the Company or the related
Servicer to, prepare and present on behalf of the Trustee and the
Certificateholders all claims under the Insurance Policies and take such actions
(including the negotiation, settlement, compromise or enforcement of the
insured’s claim) as shall be necessary to realize recovery under such policies.
Any proceeds disbursed to the Master Servicer (or disbursed to the Company
or
the related Servicer and remitted to the Master Servicer) in respect of such
policies, bonds or contracts shall be promptly deposited in the Master Servicer
Collection Account upon receipt, except that any amounts that are to be applied
upon receipt to the repair or restoration of the related Mortgaged Property,
which repair or restoration the owner of such Mortgaged Property or EMC, as
applicable, has agreed to make as a condition precedent to the presentation
of
its claims on the related EMC Mortgage Loan under the applicable Insurance
Policy, need not be so deposited (or remitted).
Section
4.08 Realization
Upon Defaulted Mortgage Loans.
The
Master Servicer shall enforce any obligation of the Company and the related
Servicer (to the extent set forth under this Agreement and the related Servicing
Agreement, as applicable) to foreclose upon, repossess or otherwise comparably
convert the ownership of Mortgaged Properties securing such of the Mortgage
Loans as come into and continue in default and as to which no satisfactory
arrangements can be made for collection of delinquent payments, all in
accordance with this Agreement or the related Servicing Agreement, as
applicable.
Section
4.09 Compensation
of the Master Servicer.
The
Master Servicer shall be entitled to the Master Servicing Fee on each
Distribution Date as compensation for the performance of its obligations
hereunder. The Master Servicer shall be required to pay all expenses incurred
by
it in connection with its activities hereunder and shall not be entitled to
reimbursement therefor except as provided in this Agreement.
Section
4.10 REO
Property.
(a) In
the
event the Trust Fund acquires ownership of any REO Property in respect of any
related Mortgage Loan, the deed or certificate of sale shall be issued to the
Trustee, or to its nominee, on behalf of the related Certificateholders. The
Master Servicer shall, to the extent provided in this Agreement and the
Servicing Agreements, as applicable, cause the Company and the related Servicer
to sell any REO Property as expeditiously as possible and in accordance with
the
provisions of this Agreement and the related Servicing Agreement, as applicable.
The Master Servicer shall enforce any obligations of the Company or the related
Servicer to protect and conserve, such REO Property in the manner and to the
extent required by this Agreement or the related Servicing Agreement, in
accordance with the REMIC Provisions and in a manner that does not result in
a
tax on “net income from foreclosure property” or cause such REO Property to fail
to qualify as “foreclosure property” within the meaning of Section 860G(a)(8) of
the Code.
(b) The
Master Servicer shall, to the extent required by this Agreement and the related
Servicing Agreement, as applicable, enforce the obligation of the Company and
the related Servicer, as applicable, to deposit all funds collected and received
in connection with the operation of any REO Property in the related Protected
Account.
Section
4.11 [Reserved].
Section
4.12 [Reserved].
Section
4.13 UCC.
EMC
shall
file any financing statements, continuation statements or amendments thereto
required by any change in the Uniform Commercial Code.
Section
4.14 Reserve
Fund; Payments to and from Swap Administrator; Supplemental Interest
Trust.
(a) As
of the
Closing Date, the Securities Administrator shall establish and maintain in
the
name of the Supplemental Interest Trust Trustee, a separate trust for the
benefit of the Holders of the Class A, Class M and Class B Certificates and
the
Swap Provider. The Supplemental Interest Trust shall hold the Swap Agreement,
the Swap Administration Agreement, the Swap Account and REMIC V Regular Interest
IO. The
Swap
Account shall be an Eligible Account, and funds on deposit therein shall be
held
separate and apart from, and shall not be commingled with, any other moneys,
including, without limitation, other moneys of the Securities Administrator
held
pursuant to this Agreement. Amounts in the Swap Account shall, at the direction
of the Majority Class C Certificateholder, be invested in Permitted Investments
that mature no later than the Business Day prior to the next succeeding
Distribution Date. All net income and gain from such investments shall be
distributed to the Majority Class C Certificateholder, not as a distribution
in
respect of any interest in any REMIC, on such Distribution Date. In the absence
of written instructions to the Securities Administrator, amounts on deposit
in
the Swap Account shall remain uninvested. All amounts earned on amounts on
deposit in the Swap Account shall be taxable to the Majority Class C
Certificateholder. Any losses on such investments shall be deposited in the
Swap
Account by the Class C Certificateholder out of its own funds immediately as
realized. In performing its duties hereunder and under the Swap Agreement and
the rights in respect of the Swap Administration Agreement, the Supplemental
Interest Trust Trustee shall be entitled to the same rights, protections and
indemnities as provided to the Securities Administrator hereunder.
(b) On
or
before the Closing Date, the Securities Administrator shall establish a Reserve
Fund on behalf of the Holders of the Certificates. On the Closing Date, the
Depositor shall cause an amount equal to the Reserve Fund Deposit to be
deposited into the Reserve Fund. The Reserve Fund must be an Eligible Account.
The Reserve Fund shall be titled “ Reserve Fund, LaSalle Bank National
Association, as Securities Administrator on behalf of Citibank, N.A. as Trustee
for the benefit of holders of SACO I Trust 2006-9, Mortgage-Backed Certificates,
Series 2006-9, Certificates”. The Securities Administrator shall deposit in the
Reserve Fund all payments received from the Swap Administrator that are payable
to the Trust Fund pursuant to the Swap Administration Agreement. On each
Distribution Date, the Securities Administrator shall remit such amounts
received from the Swap Administrator to the Holders of the Class A, Class M
and
Class B Certificates in the manner provided in clause (d) below. In addition,
on
each Distribution Date as to which there is a Basis Risk Shortfall Carry Forward
Amount payable to any Class of Class A, Class M or Class B Certificates, the
Securities Administrator shall deposit the amounts distributable pursuant to
clauses (C) and (D) of Section 6.04(a)(3) into the Reserve Fund, and the
Securities Administrator has been directed by the Class C Certificateholder
to
distribute any amounts then on deposit in the Reserve Fund to the Holders of
the
Class A, Class M or Class B Certificates in respect of the Basis Risk Shortfall
Carry Forward Amounts for each such Class in the priorities set forth in clauses
(C) and (D) of Section 6.04(a)(3). Any amount paid to the Holders of Class
A,
Class M or Class B Certificates from amounts distributable pursuant to clauses
(C) and (D) of Section 6.04(a)(3) pursuant to the preceding sentence in respect
of Basis Risk Shortfall Carry Forward Amounts shall be treated as distributed
to
the Class C Certificateholder in respect of the Class C Certificates and paid
by
the Class C Certificateholder to the Holders of the Class A, Class M and Class
B
Certificates, as applicable. Any payments to the Holders of the Class A, Class
M
and Class B Certificates in respect of Basis Risk Shortfall Carry Forward
Amounts, whether pursuant to the second preceding sentence or pursuant to clause
(d) below, shall not be payments with respect to a Regular Interest in a REMIC
within the meaning of Section 860G(a)(1) of the Code.
(c) Net
Swap
Payments and Swap Termination Payments (other than Swap Termination Payments
resulting from a Swap Provider Trigger Event and to the extent not paid by
the
Swap Administrator on behalf of the Supplemental Interest Trust Trustee from
any
upfront payment received pursuant to any replacement interest rate swap
agreement that may be entered into by the Supplemental Interest Trust Trustee)
payable by the Swap Administrator, on behalf of the Supplemental Interest Trust
Trustee, to the Swap Provider pursuant to the Swap Agreement shall be deducted
from Interest Funds, and to the extent of any such remaining amounts due, from
Principal Funds, prior to any distributions to the Certificateholders. On or
before each Distribution Date, such amounts shall be remitted to the Swap
Administrator, and deposited into the Swap Account, first to make any Net Swap
Payment owed to the Swap Provider pursuant to the Swap Agreement for such
Distribution Date and for prior Distribution Dates, if any, and second to make
any Swap Termination Payment (not due to a Swap Provider Trigger Event and
to
the extent not paid by the Swap Administrator on behalf of the Supplemental
Interest Trust Trustee from any upfront payment received pursuant to any
replacement interest rate swap agreement that may be entered into by the
Supplemental Interest Trust Trustee) owed to the Swap Provider pursuant to
the
Swap Agreement for such Distribution Date and for prior Distribution Dates,
if
any. For federal income tax purposes, such amounts paid to the Supplemental
Interest Trust on each Distribution Date shall first be deemed paid to the
Supplemental Interest Trust in respect of REMIC V Regular Interest IO to the
extent of the amount distributable on such REMIC V Regular Interest IO on such
Distribution Date, and any remaining amount shall be deemed paid to the
Supplemental Interest Trust in respect of a Class IO Distribution Amount. Any
Swap Termination Payment triggered by a Swap Provider Trigger Event owed to
the
Swap Provider pursuant to the Swap Agreement will be subordinated to
distributions to the Holders of the Class A, Class M and Class B Certificates,
and the Swap Administrator shall pay the amount set forth in Section 6.04(a)(3)
to the Swap Provider. In addition, the Swap Administrator shall remit to the
Swap Provider any Swap Optional Termination Payment paid as part of the Mortgage
Loan Purchase Price and remitted to the Supplemental Interest Trust pursuant
to
Section 11.01.
(d) On
or
before each Distribution Date, Net Swap Payments payable by the Swap Provider
pursuant to the Swap Agreement to the Swap Administrator, on behalf of the
Supplemental Interest Trust Trustee, will be deposited by the Swap
Administrator, acting on behalf of the Supplemental Interest Trust Trustee,
into
the Swap Account pursuant to the Swap Administration Agreement. The Swap
Administrator shall, to the extent provided in the Swap Administration
Agreement, remit amounts on deposit in the Swap Account to the Securities
Administrator for deposit into the Reserve Fund. On each Distribution Date,
to
the extent required, the Securities Administrator shall withdraw such amounts
from the Reserve Fund to distribute to the Certificates in the following order
of priority:
(i) first,
to the
Class A Certificates to pay (a) Current Interest and any Interest Carry Forward
Amount to the extent due to the interest portion of a Realized Loss, in each
case to the extent not fully paid pursuant to Section 6.04(a)(1) and (b) any
Unpaid Realized Loss Amounts for such Class;
(ii) second,
sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5,
Class
M-6, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates, in that order,
to pay Current Interest to the extent not fully paid pursuant to Section
6.04(a)(1) and any Interest Carry Forward Amount, in each case to the extent
due
to the interest portion of a Realized Loss;
(iii) third,
to pay
sequentially, to the Class A, Class M-1, Class M-2, Class M-3, Class M-4, Class
M-5, Class M-6, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates,
in
that order, any Basis Risk Shortfall Carry Forward Amounts for such Distribution
Date; and
(iv) fourth,
to pay
as principal to the Class A, Class M and Class B Certificates as part of the
Extra
Principal Distribution Amount
payable
under Section 6.04(a)(2) until the Overcollateralization Target Amount has
been
reached, to the extent not paid from Excess Cashflow pursuant to Section
6.04(a)(3) for such Distribution Date. For the avoidance of doubt, any amounts
distributable pursuant to this clause (iv) shall be limited to rebuilding
overcollateralization related to Loan to the extent overcollateralization has
been reduced through Realized Losses related to Loan .
(e) The
Reserve Fund is an “outside reserve fund” within the meaning of Treasury
Regulation Section 1.860G-2(h) and shall be an asset of the Trust Fund but
not
an asset of any REMIC. The Securities Administrator on behalf of the Trust
shall
be the nominal owner of the Reserve Fund. The Majority Class C Certificateholder
shall be the beneficial owner of the Reserve Fund, subject to the power of
the
Securities Administrator on behalf of the Securities Administrator to transfer
amounts under Section 6.04. Amounts in the Reserve Fund shall, at the written
direction of the Majority Class C Certificateholder to the Securities
Administrator, be invested in Permitted Investments that mature no later than
the Business Day prior to the next succeeding Distribution Date. All net income
and gain from such investments shall be distributed to the Majority Class C
Certificateholders, not as a distribution in respect of any interest in any
REMIC, on such Distribution Date. In the absence of written instructions to
the
Securities Administrator, amounts on deposit in the Reserve Fund shall remain
uninvested. All amounts earned on amounts on deposit in the Reserve Fund shall
be taxable to the Majority Class C Certificateholder. Any losses on such
investments shall be deposited in the Reserve Fund by the Majority Class C
Certificateholder out of its own funds immediately as realized. The
Swap
Account, which is created and maintained by the Swap Administrator pursuant
to
the Swap Administration Agreement, is an “outside reserve fund” within the
meaning of Treasury Regulation Section 1.860G-2(h) and shall not be an asset
of
any REMIC created hereunder. The beneficial owner of the Swap Account is
identified, and other matters relating to the Swap Account are addressed, in
the
Swap Administration Agreement.
(f) The
Securities Administrator shall treat the Holders of Certificates (other than
the
Class C Certificates and Class R Certificates) as having entered into a notional
principal contract with respect to the Holders of the Class C Certificates.
Pursuant to each such notional principal contract, all Holders of Certificates
(other than the Class C Certificates and Class R Certificates) shall be treated
as having agreed to pay, on each Distribution Date, to the Holder of the Class
C
Certificates an aggregate amount equal to the excess, if any, of (i) the amount
payable on such Distribution Date on the REMIC III Regular Interest
corresponding to such Class of Certificates over (ii) the amount payable on
such
Class of Certificates on such Distribution Date (such excess, a “Class IO
Distribution Amount”). A Class IO Distribution Amount payable from interest
collections shall be allocated pro
rata
among
such Certificates based on the excess of, with respect to each such Certificate,
(i) the amount of interest otherwise payable to the REMIC III Regular Interest
relating to such Certificate over (ii) the amount of interest payable to such
Certificate at a per annum rate equal to the Net WAC Cap Rate, and a Class
IO
Distribution Amount payable from principal collections shall be allocated to
the
most subordinate Class of Certificates with an outstanding principal balance
to
the extent of such balance. In addition, pursuant to such notional principal
contract, the Holder of the Class C Certificates shall be treated as having
agreed to pay Basis Risk Shortfall Carry Forward Amounts with respect to the
Holders of the Certificates (other than the Class C Certificates and Class
R
Certificates) in accordance with the terms of this Agreement. Any payments
to
the Certificates from amounts deemed received in respect of this notional
principal contract shall not be payments with respect to a Regular Interest
in a
REMIC within the meaning of Code Section 860G(a)(1). However, any payment from
the Certificates (other than the Class C Certificates and Class R Certificates)
of a Class IO Distribution Amount shall be treated for tax purposes as having
been received by the Holders of such Certificates in respect of their interests
in REMIC III and as having been paid by such Holders to the Swap Administrator
pursuant to the notional principal contract. Thus, each Certificate (other
than
the Class R Certificates) shall be treated as representing not only ownership
of
a Regular Interest in REMIC III, but also ownership of an interest in, and
obligations with respect to, a notional principal contract.
Section
4.15 Reserved.
Section
4.16 Tax
Treatment of Class IO Distribution Amounts in the Event of Resecuritization
of
Class A, Class M or Class B Certificates.
In
the
event that any Class A, Class M or Class B Certificate is resecuritized in
a
REMIC (the “Resecuritization REMIC”), for federal income tax purposes, (i)
payments on the REMIC III Regular Interest corresponding to such Class A, Class
M or Class B Certificate shall, for the avoidance of doubt, be deemed to include
the related Class IO Distribution Amount, and (ii) to the extent provided in
the
operative documents for the Resecuritization REMIC, (a) payments on the “regular
interests” issued by the Resecuritization REMIC shall be deemed to include in
the aggregate such Class IO Distribution Amount, and (b) such Class IO
Distribution Amount shall be deemed paid to the Holder of the Class C
Certificates pursuant to a notional principal contract entered into by the
holders of one or more “regular interests” issued by the Resecuritization REMIC
(“Resecuritization Holders”) and the Holder of the Class C Certificates. In such
event, Class IO Distribution Amounts deemed paid by Resecuritization Holders
under clause (b) of the immediately preceding sentence shall be paid on behalf
of such holders pursuant to Section 4.14(c) hereof.
ARTICLE
V
ACCOUNTS
Section
5.01 Collection
of Mortgage Loan Payments; Protected Account.
(a) The
Company shall make reasonable efforts in accordance with customary and usual
standards of practice of prudent mortgage lenders in the respective states
in
which the Mortgaged Properties related to the EMC Mortgage Loans are located
to
collect all payments called for under the terms and provisions of the EMC
Mortgage Loans to the extent such procedures shall be consistent with this
Agreement and the terms and provisions of any related Required Insurance Policy.
Consistent with the foregoing, the Company may in its discretion (i) waive
any
late payment charge and (ii) extend the Due Dates for payments due on a Mortgage
Note related to an EMC Mortgage Loan for a period not greater than 125 days,
provided that, EMC shall not extend the payment date of any Mortgage Loan beyond
the date of its final maturity date. In the event of any such arrangement,
the
Company shall make Advances on the related EMC Mortgage Loan during the
scheduled period in accordance with the amortization schedule of such EMC
Mortgage Loan without modification thereof by reason of such arrangements,
and
shall be entitled to reimbursement therefor in accordance with Section 6.01.
The
Company shall not be required to institute or join in litigation with respect
to
collection of any payment (whether under a Mortgage, Mortgage Note or otherwise
or against any public or governmental authority with respect to a taking or
condemnation) if it reasonably believes that enforcing the provision of the
Mortgage or other instrument pursuant to which such payment is required is
prohibited by applicable law. In addition, if (x) an EMC Mortgage Loan is in
default or default is reasonably foreseeable, the Company may also waive, modify
or vary any term of any EMC Mortgage Loan or
consent to the postponement of strict compliance with any such term or in any
manner grant indulgence to any mortgagor, including without limitation, to
(1)
capitalize any amounts owing on the EMC Mortgage Loan by adding such amount
to
the outstanding principal balance of the EMC Mortgage Loan, (2) defer such
amounts to a later date or the final payment date of such Mortgage Loan, (3)
extend the maturity of any such EMC Mortgage Loan, but in no instance past
the
date on which the final payment is due on the latest maturing Mortgage Loan
as
of the Cut-off Date, and/or (4) reduce the related Mortgage Rate (subject to
clause (y) below), provided that, in the Company’s determination, such waiver,
modification, postponement or indulgence is not materially adverse to the
interests of the Certificateholders (taking into account any estimated Realized
Loss that might result absent such action), or (y)
the
Company delivers to the Trustee, Securities Administrator and Master Servicer
a
certification addressed to the Trustee and the Securities Administrator, based
on the advice of counsel or certified public accountants, in either case, that
have a national reputation with respect to taxation of REMICs, that a
modification of such EMC Mortgage Loan will not result in the imposition of
taxes on or disqualify from REMIC status any of REMIC I, REMIC II, REMIC III,
REMIC IV or REMIC V, the Company may if it reasonably believes that undertaking
such actions would be in the best interest of the Certificateholders, (A) amend
the related Mortgage Note to reduce the Mortgage Rate applicable thereto,
provided that such reduced Mortgage Rate shall in no event be lower than 5.00%
with respect to any EMC Mortgage Loan and (B) amend any Mortgage Note related
to
an EMC Mortgage Loan to extend the maturity thereof; provided that, EMC shall
not extend the payment date of any Mortgage Loan beyond its final maturity
date.
In
accordance with the standards of the first paragraph of Section 3.01, the
Company shall not waive (or permit a sub-servicer to waive) any Prepayment
Charge related to an EMC Mortgage Loan unless: (i) the enforceability thereof
shall have been limited by bankruptcy, insolvency, moratorium, receivership
and
other similar laws relating to creditors’ rights generally, (ii) the enforcement
thereof is illegal, or any local, state or federal agency has threatened legal
action if the prepayment penalty is enforced, (iii) the mortgage debt has been
accelerated in connection with a foreclosure or other involuntary payment or
(iv) such waiver is standard and customary in servicing similar Mortgage Loans
and relates to a default or a reasonably foreseeable default and would, in
the
reasonable judgment of the Company, maximize recovery of total proceeds taking
into account the value of such Prepayment Charge and the related EMC Mortgage
Loan. If a Prepayment Charge is waived, but does not meet the standards
described above, then the Company is required to pay the amount of such waived
Prepayment Charge, for the benefit of the Class C Certificates, by remitting
such amount to the Master Servicer by the Remittance Date.
Payments
of such waived charges shall not be payments in respect of any Regular
Interest.
(b) The
Company shall establish and maintain a Protected Account (which shall at all
times be an Eligible Account) with a depository institution in the name of
the
Company for the benefit of the Trustee on behalf of the Certificateholders
and
designated “EMC Mortgage Corporation, as servicer on behalf of Citibank, N.A.,
as Trustee, for the benefit of the certificateholders, in trust for registered
Holders of SACO I Trust 2006-9, Mortgage-Backed Certificates, Series 2006-9”.
The Company shall deposit or cause to be deposited into the Protected Account
on
a daily basis within one Business Day of receipt, except as otherwise
specifically provided herein, the following payments and collections remitted
by
subservicers or received by it in respect of the EMC Mortgage Loans subsequent
to the Cut-off Date (other than in respect of principal and interest due on
the
EMC Mortgage Loans on or before the Cut-off Date) and the following amounts
required to be deposited hereunder:
(i) all
payments on account of principal, including Principal Prepayments, on the EMC
Mortgage Loans;
(ii) all
payments on account of interest on the EMC Mortgage Loans net of the related
Servicing Fee permitted under Section 3.13, if any;
(iii) all
Liquidation Proceeds, Subsequent Recoveries and Insurance Proceeds with respect
to any EMC Mortgage Loans, other than proceeds to be applied to the restoration
or repair of the Mortgaged Property or released to the Mortgagor in accordance
with the Company’s normal servicing procedures;
(iv) any
amount required to be deposited by the Company pursuant to Section 5.01(c)
in
connection with any losses on Permitted Investments;
(v) any
amounts required to be deposited by the Company pursuant to Section
3.07;
(vi) any
Prepayment Charges collected on the EMC Mortgage Loans; and
(vii) any
other
amounts required to be deposited hereunder.
The
foregoing requirements for deposit by the Company
into the
Protected Account shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, payments in the nature of
late
payment charges or assumption fees, if collected, need not be deposited by
the
Company. In the event that the Company shall deposit any amount not required
to
be deposited and not otherwise subject to withdrawal pursuant to Section 5.02,
it may at any time withdraw or direct the institution maintaining the Protected
Account, to withdraw such amount from the Protected Account, any provision
herein to the contrary notwithstanding. Such withdrawal or direction may be
accomplished by delivering written notice thereof to the institution maintaining
the Protected Account, that describes the amounts deposited in error in the
Protected Account. The Company shall maintain adequate records with respect
to
all withdrawals made pursuant to this Section. All funds deposited in the
Protected Account shall be held in trust for the Certificateholders until
withdrawn in accordance with Section 5.02.
(c) The
institution that maintains the Protected Account shall invest the funds in
the
Protected Account, in the manner directed by the Company,
in
Permitted Investments which shall mature not later than the Business Day
immediately preceding the Remittance Date and shall not be sold or disposed
of
prior to its maturity. All such Permitted Investments shall be made in the
name
of the Trustee, for the benefit of the Certificateholders. All income and gain
net of any losses realized from any such investment shall be for the benefit
of
the Company
as
servicing compensation and shall be remitted to it monthly as provided herein.
The amount of any losses incurred in the Protected Account in respect of any
such investments shall be deposited by the Company
into the
Protected Account, out of the Company’s
own
funds.
(d) The
Company
shall
give at least 30 days advance notice to the Trustee, the Securities
Administrator, the Seller, the Master Servicer, each Rating Agency and the
Depositor of any proposed change of location of the Protected Account prior
to
any change thereof.
Section
5.02 Permitted
Withdrawals From the Protected Account.
(a) The
Company
may from
time to time make withdrawals from the Protected Account for the following
purposes:
(i) to
pay
itself (to the extent not previously paid to or withheld by the Company),
as
servicing compensation in accordance with Section 3.13, that portion of any
payment of interest that equals the Servicing Fee for the period with respect
to
which such interest payment was made, and, as additional servicing compensation,
those other amounts set forth in Section 3.13;
(ii) to
reimburse the Company
for
Advances made by it with respect to the Mortgage Loans, provided, however,
that
the Company’s
right
of reimbursement pursuant to this subclause (ii) shall be limited to amounts
received on particular EMC Mortgage Loan(s) (including, for this purpose,
Liquidation Proceeds and Insurance Proceeds and Subsequent Recoveries) that
represent late recoveries of payments of principal and/or interest on such
particular EMC Mortgage Loan(s) in respect of which any such Advance was
made;
(iii) to
reimburse the Company
for any
previously made portion of a Servicing Advance or an Advance made by the
Company
that, in
the good faith judgment of the Company,
will
not be ultimately recoverable by it from the related Mortgagor, any related
Liquidation Proceeds, Insurance Proceeds or otherwise (a “Nonrecoverable
Advance”), to the extent not reimbursed pursuant to clause (ii) or clause
(v);
(iv) to
pay
the Company
any
unpaid Servicing Fees and to reimburse it for any unreimbursed Servicing
Advances, provided, however, that the Company’s
right
to reimbursement for Servicing Advances pursuant to this subclause (v) with
respect to any Mortgage Loan shall be limited to amounts received on particular
Mortgage Loan(s) (including, for this purpose, Liquidation Proceeds, Insurance
Proceeds, Subsequent Recoveries and purchase and repurchase proceeds) that
represent late recoveries of the payments for which such Servicing Advances
were
made;
(v) to
pay to
EMC (in its capacity as Seller), the Depositor or itself, as applicable, with
respect to each EMC Mortgage Loan or property acquired in respect thereof that
has been purchased pursuant to Section 2.02, 2.03 or 3.05 of this Agreement,
all
amounts received thereon and not taken into account in determining the related
Stated Principal Balance of such repurchased EMC Mortgage Loan;
(vi) to
pay
any expenses recoverable by the Company
pursuant
to Section 8.04 of this Agreement;
(vii) to
withdraw pursuant to Section 5.01 any amount deposited in the Protected Account
and not required to be deposited therein; and
(viii) to
clear
and terminate the Protected Account upon termination of this Agreement pursuant
to Section 11.01 hereof.
In
addition, no later than 1:00 p.m. New York City time on the Remittance Date,
the
Company shall withdraw from the Protected Account and remit to the Master
Servicer, for deposit in the Master Servicer Collection Account the amount
required to be withdrawn therefrom pursuant to Section 5.05 hereof.
With
respect to any remittance received by the Master Servicer from EMC after the
date on which such remittance was due, EMC shall pay to the Master Servicer
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 that the maximum amount permitted by applicable law. Such interest
shall be remitted to the Master Servicer on the date such late payment is made
and shall cover the period commencing with the day following the date on which
such remittance was due and ending with the Business Day on which such
remittance is made, both inclusive. The payment by EMC of any such interest
shall not be deemed an extension of time for payment or a waiver of any Event
of
Default with respect to EMC.
The
Company
shall
keep and maintain separate accounting, on a Mortgage Loan by Mortgage Loan
basis, for the purpose of justifying any withdrawal from the Protected Account
pursuant to subclauses (i), (ii), (iv), (v) and (vi) above. Prior to making
any
withdrawal from the Protected Account pursuant to subclause (iii), the Company
shall deliver to the Master Servicer an Officer’s Certificate of a Servicing
Officer indicating the amount of any previous Advance or Servicing Advance
determined by the Company to be a Nonrecoverable Advance and identifying the
related EMC Mortgage Loan(s), and their respective portions of such
Nonrecoverable Advance.
Section
5.03 Reports
to the Master Servicer.
(a)
On
or
before the tenth calendar day of each month, the Company shall furnish to the
Master Servicer electronically in a format acceptable to the Master Servicer
loan accounting reports in the investor’s assigned loan number order to document
the payment activity on each EMC Mortgage Loan on an individual mortgage loan
basis. With respect to each month, such loan accounting reports shall be in
the
format agreed to by the Company and the Master Servicer, including but not
limited to the following information with respect to each EMC Mortgage
Loan:
(i) with
respect to each Scheduled Payment (on both an actual and scheduled basis with
respect to Mortgage Loan balances and on an actual basis with respect to
paid-through dates), the amount of such remittance allocable to principal
(including a separate breakdown of any Principal Prepayment, including the
amount of any Prepayment Interest Shortfall);
(ii) with
respect to each Monthly Payment, the amount of such remittance allocable to
scheduled interest;
(iii) the
amount of servicing compensation received by the Company during the prior
calendar month;
(iv) the
aggregate stated principal balance of the EMC Mortgage Loans;
(v) the
aggregate amount of Advances made by the Company pursuant to Section
6.01;
(vi) the
aggregate of any expenses reimbursed to the Company during the prior calendar
month pursuant to Section 5.02;
(vii) the
number and aggregate Stated Principal Balance of the Mortgage Loans (A)
Delinquent (exclusive of Mortgage Loans in foreclosure and bankruptcy) (1)
30
days Delinquent, (2) 60 days Delinquent and (3) 90 days or more Delinquent,
(B)
in foreclosure and delinquent and (1) 30 days Delinquent, (2) 60 days Delinquent
and (3) 90 days or more Delinquent (C) in bankruptcy and delinquent (1) 30
days
Delinquent, (2) 60 days Delinquent and (3) 90 days or more Delinquent, in each
case as of the close of business on the last day of the calendar month preceding
such Distribution Date;
(viii) the
amount of any Prepayment Charges collected by the Company and the amount of
Prepayment Charges paid by the Company in connection with a waiver that is
not
permitted under this Agreement, and
(ix) any
other
information necessary for the Securities Administrator to prepare the Monthly
Statement pursuant to Section 6.06, including any information required to be
provided pursuant to Item 1121 of Regulation AB.
On
or
before the seventeenth calendar day of each month, or if such day is not a
Business
Day,
the
succeeding Business Day, the Company shall furnish to the Master Servicer
electronically in a format acceptable to the Master Servicer a report of all
Principal Prepayments made during the related Prepayment Period.
(b) The
Master Servicer and the Securities Administrator shall be entitled to rely
conclusively on the data provided by the Company and the related Servicer
pursuant to Section 5.03(a) above and shall have no liability for any errors
in
such Mortgage Loan data.
Section
5.04 Collection
of Taxes; Assessments and Similar Items; Escrow Accounts.
With
respect to each EMC Mortgage Loan, to the extent required by the related
Mortgage Note, the Company shall establish and maintain one or more accounts
(each, an “Escrow Account”) and deposit and retain therein all collections from
the Mortgagors (or Servicing Advances by the Company) for the payment of taxes,
assessments, hazard insurance premiums or comparable items for the account
of
the Mortgagors. Nothing herein shall require the Company to compel a Mortgagor
to establish an Escrow Account in violation of applicable law.
Withdrawals
of amounts so collected from the Escrow Accounts may be made only to effect
timely payment of taxes, assessments, hazard insurance premiums, condominium
or
PUD association dues, or comparable items, to reimburse the Company out of
related collections for any payments made with respect to each EMC Mortgage
Loan
pursuant to Section 3.01 (with respect to taxes and assessments and insurance
premiums) and Section 3.07 (with respect to hazard insurance), to refund to
any
Mortgagors for any EMC Mortgage Loans any sums as may be determined to be
overages, to pay interest, if required by law or the terms of the related
Mortgage or Mortgage Note, to such Mortgagors on balances in the Escrow Account
or to clear and terminate the Escrow Account at the termination of this
Agreement in accordance with Section 11.01 thereof. The Escrow Account shall
not
be a part of the Trust Fund.
Section
5.05 Protected
Accounts.
(a) The
Master Servicer shall enforce the obligation of the Company and the related
Servicers to establish and maintain a Protected Account in accordance with
this
Agreement and the Servicing Agreements, with records to be kept with respect
thereto on a Mortgage Loan by Mortgage Loan basis, into which accounts shall
be
deposited within one Business Day (or as of such other time specified in the
Servicing Agreements) of receipt all collections of principal and interest
on
any Mortgage Loan and with respect to any REO Property received by the Company
or the related Servicer, including Principal Prepayments, Insurance Proceeds,
Liquidation Proceeds, Subsequent Recoveries, and advances made from the
Company’s or such Servicer’s own funds (less servicing compensation as permitted
by this Agreement or the related Servicing Agreement) and all other amounts
to
be deposited in the Protected Accounts. Each of the Company and the related
Servicers is hereby authorized to make withdrawals from and deposits to the
related Protected Account for purposes required or permitted by this Agreement.
To the extent provided in this Agreement or any Servicing Agreement, the
Protected Account shall be held in a Designated Depository Institution and
segregated on the books of such institution in the name of the Company or
Servicer, as applicable on behalf of the Trustee for the benefit of
Certificateholders.
(b) To
the
extent provided in this Agreement or any Servicing Agreement, amounts on deposit
in a Protected Account may be invested in Permitted Investments in the name
of
the Trustee for the benefit of Certificateholders and, except as provided in
the
preceding paragraph, not commingled with any other funds, such Permitted
Investments to mature, or to be subject to redemption or withdrawal, no later
than the date on which such funds are required to be withdrawn for deposit
in
the Master Servicer Collection Account, and shall be held until required for
such deposit. The income earned from Permitted Investments made pursuant to
this
Section 5.05 shall be paid to the Company or the related Servicer under this
Agreement or the related Servicing Agreement, and the risk of loss of moneys
required to be distributed to the Certificateholders resulting from such
investments shall be borne by and be the risk of the Company or the related
Servicer, as the case may be. The Company or the related Servicer (to the extent
provided in this Agreement or the related Servicing Agreement) shall deposit
the
amount of any such loss in the Protected Account within two Business Days of
receipt of notification of such loss but not later than the second Business
Day
prior to the Distribution Date on which the moneys so invested are required
to
be distributed to the Certificateholders.
(c) To
the
extent provided in this Agreement or the related Servicing Agreement and subject
to this Article V, on or before 1:00 p.m. New York City time on each Remittance
Date, the Company or the related Servicer shall withdraw or shall cause to
be
withdrawn from its Protected Account and shall immediately deposit or cause
to
be deposited in the Master Servicer Collection Account amounts representing
the
following collections and payments (other than with respect to principal of
or
interest on the Mortgage Loans due on or before the Cut-off Date):
(i) Scheduled
Payments on the Mortgage Loans received or any related portion thereof advanced
by the Company or the related Servicer pursuant to the related Servicing
Agreement which were due on or before the related Due Date, net of the amount
thereof comprising the Servicing Fees;
(ii) Full
Principal Prepayments and any Liquidation Proceeds received by the Company
or
the related Servicer with respect to such Mortgage Loans in the related
Prepayment Period, with interest to the date of prepayment or liquidation,
net
of the amount thereof comprising the Servicing Fees;
(iii) Partial
Principal Prepayments received by the Company or the related Servicer for such
Mortgage Loans in the related Prepayment Period, together with any related
payments of Compensating Interest;
(iv) Any
amount to be used as an Advance; and
(v) The
amount of any Prepayment Charges collected with respect to the Mortgage Loans
and the amount of any Prepayment Charges paid by the Company or the related
Servicer in connection with the waiver of a Prepayment Charge in a manner that
is not permitted under this Agreement or the related Servicing
Agreement.
(d) Withdrawals
may be made from a Protected Account by the Company as described in Section
5.02
hereof and by the Master Servicer or the related Servicer only to make
remittances as provided in Section 5.05(c), 5.08 and 5.09; to reimburse the
Master Servicer or the related Servicer for Advances which have been recovered
by subsequent collection from the related Mortgagor; to remove amounts deposited
in error; to remove fees, charges or other such amounts deposited on a temporary
basis; or to clear and terminate the account at the termination of this
Agreement in accordance with Section 11.01. As provided in Sections 5.05(c)
and
5.06(b) certain amounts otherwise due to the related Servicer may be retained
by
the related Servicer and need not be deposited in the Master Servicer Collection
Account.
Section
5.06 Master
Servicer Collection Account.
(a) The
Master Servicer shall establish and maintain in the name of LaSalle Bank
National Association, as Master Servicer, on behalf of the Trustee, for the
benefit of the Certificateholders, the Master Servicer Collection Account which
shall be an Eligible Account. The Master Servicer will deposit in the Master
Servicer Collection Account as identified by the Master Servicer and as received
by the Master Servicer, the following amounts:
(i) any
Advance and any Compensating Interest Payments;
(ii) any
Insurance Proceeds, Liquidation Proceeds or Subsequent Recoveries received
by
the Master Servicer;
(iii) the
Repurchase Price with respect to any Mortgage Loans purchased by the Seller
pursuant to Section 2.02 or 2.03, the Repurchase Price with respect to any
Mortgage Loans purchased by EMC pursuant to Section 3.05, and all proceeds
of
any Mortgage Loans or property acquired with respect thereto repurchased by
the
Seller or its designee pursuant to Section 11.01;
(iv) any
amounts required to be deposited with respect to losses on investments of
deposits in the Master Servicer Collection Account; and
(v) any
other
amounts received by or on behalf of the Master Servicer or the Trustee and
required to be deposited in the Master Servicer Collection Account pursuant
to
this Agreement.
(b) All
amounts deposited to the Master Servicer Collection Account shall be held by
the
Master Servicer in the name of the Trustee in trust for the benefit of the
Certificateholders in accordance with the terms and provisions of this
Agreement. The requirements for crediting the Master Servicer Collection Account
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of late payment charges
or
assumption, tax service, statement account or payoff, substitution,
satisfaction, release and other like fees and charges, need not be credited
by
the Master Servicer to the Master Servicer Collection Account.
(c) The
amount at any time credited to the Master Servicer Collection Account may be
invested, in the name of the Trustee, or its nominee, for the benefit of the
Certificateholders, in Permitted Investments or be held in cash as directed
by
the Securities Administrator. All Permitted Investments shall mature or be
subject to redemption or withdrawal on or before, and shall be held until,
the
next succeeding Distribution Account Deposit Date. Any and all investment
earnings from the Master Servicer Collection Account shall be paid to the
Securities Administrator. The risk of loss of moneys required to be distributed
to the Certificateholders resulting from such investments shall be borne by
and
be the risk of the Securities Administrator. The Securities Administrator shall
deposit the amount of any such loss in the Master Servicer Collection Account
within two Business Days of receipt of notification of such loss but not later
than the second Business Day prior to the Distribution Date on which the moneys
so invested are required to be distributed to the
Certificateholders.
Section
5.07 Permitted
Withdrawals and Transfers from the Master Servicer Collection
Account.
(a) The
Master Servicer will make such withdrawals or transfers from the Master Servicer
Collection Account as the Master Servicer has designated for such transfer
or
withdrawal pursuant to this Agreement. The Master Servicer may clear and
terminate the Master Servicer Collection Account pursuant to Section 11.01
and
from time to time remove amounts deposited in error.
(b) On
an
ongoing basis, the Master Servicer shall withdraw from the Master Servicer
Collection Account to pay itself as provided in Section 4.09 and to pay any
expenses, costs and liabilities recoverable by the Trustee, the Swap Provider,
the Master Servicer, each Custodian or the Securities Administrator pursuant
to
Sections 4.02, 8.03, 8.04, 9.05 and 10.05; provided however, that the Master
Servicer shall be obligated to pay from its own funds any amounts which it
is
required to pay under Section 8.03(a).
(c) In
addition, on or before each Distribution Account Deposit Date, the Master
Servicer shall remit to the Securities Administrator for deposit in the
Distribution Account any Advances required to be made by the Master Servicer
with respect to the Mortgage Loans.
(d) No
later
than 3:00 p.m. New York time on each Distribution Account Deposit Date (or
at
such other time and date as is mutually agreed upon between the Master Servicer
and the Securities Administrator), the Master Servicer will transfer all
available funds on deposit in the Master Servicer Collection Account with
respect to the related Distribution Date to the Securities Administrator for
deposit in the Distribution Account. In the event that the Master Servicer
shall
deposit or cause to be deposited to the Distribution Account any amount not
required to be credited thereto, the Securities Administrator, upon receipt
of a
written request therefor signed by a Master Servicing Officer of the Master
Servicer, shall promptly transfer such amount to the Master Servicer, any
provision herein to the contrary notwithstanding.
Section
5.08 Distribution
Account.
(a) The
Securities Administrator shall establish and maintain in the name of the
Securities Administrator, on behalf of the Trustee, for the benefit of the
Certificateholders, the Distribution Account as a segregated trust account
or
accounts.
(b) All
amounts deposited to the Distribution Account shall be held by the Securities
Administrator in the name of the Trustee in trust for the benefit of the
Certificateholders in accordance with the terms and provisions of this
Agreement.
(c) The
Distribution Account shall constitute an Eligible Account of the Trust Fund
segregated on the books of the Securities Administrator and held by the
Securities Administrator, and the Distribution Account and the funds deposited
therein shall not be subject to, and shall be protected from, all claims, liens,
and encumbrances of any creditors or depositors of the Securities Administrator
(whether made directly, or indirectly through a liquidator or receiver of the
Securities Administrator). The amount at any time credited to the Distribution
Account may be, as directed by the Securities Administrator, held either
uninvested or invested in the name of the Trustee, in such Permitted Investments
as may be selected by the Securities Administrator on such direction which
mature not later than the Business Day immediately preceding the next
Distribution Date. Permitted Investments in respect of the Distribution Account
shall not be sold or disposed of prior to their maturity. All investment
earnings on amounts on deposit in the Distribution Account or benefit from
funds
uninvested therein from time to time shall be for the account of the Securities
Administrator. The Securities Administrator shall be permitted to receive
distribution of any and all investment earnings from the Distribution Account
on
each Distribution Date. If there is any loss on a Permitted Investment or demand
deposit, the Securities Administrator shall deposit the amount of the loss
in
the Distribution Account from its own funds. With respect to the Distribution
Account and the funds deposited therein, the Securities Administrator shall
take
such action as may be necessary to ensure that the Certificateholders shall
be
entitled to the priorities afforded to such a trust account (in addition to
a
claim against the estate of the Trustee) as provided by 12 U.S.C. § 92a(e), and
applicable regulations pursuant thereto, if applicable.
Section
5.09 Permitted
Withdrawals and Transfers from the Distribution Account.
(a) The
Securities Administrator will from time to time make or cause to be made such
withdrawals or transfers from the Distribution Account as are designated for
such transfer or withdrawal pursuant to this Agreement any the Servicing
Agreement (limited in the case of amounts due the Master Servicer to those
not
withdrawn from the Master Servicer Collection Account in accordance with the
terms of this Agreement):
(i) to
reimburse the Master Servicer, the Company or the related Servicer for any
unreimbursed Advance or Servicing Advance of its own funds pursuant to this
Agreement or the related Servicing Agreement, such right of the Master Servicer,
the Company or the related Servicer to reimbursement pursuant to this subclause
(i) being limited to amounts received on a particular Mortgage Loan (including,
for this purpose, the Repurchase Price therefor, Insurance Proceeds and
Liquidation Proceeds) which represent late payments or recoveries of the
principal of or interest on such Mortgage Loan respecting which such Advance
or
Servicing Advance was made;
(ii) to
reimburse the Master Servicer, the Company or the related Servicer from
Insurance Proceeds or Liquidation Proceeds relating to a particular Mortgage
Loan for unreimbursed amounts expended by the Master Servicer, the Company
or
the related Servicer in good faith in connection with the restoration of the
related Mortgaged Property which was damaged by an uninsured cause or in
connection with the liquidation of such Mortgage Loan;
(iii) to
reimburse the Master Servicer, the Company or the related Servicer from
Insurance Proceeds relating to a particular Mortgage Loan for unreimbursed
expenses incurred with respect to such Mortgage Loan and to reimburse the Master
Servicer, the Company or the related Servicer from Liquidation Proceeds from
a
particular Mortgage Loan for Liquidation Expenses incurred with respect to
such
Mortgage Loan; provided that the Master Servicer shall not be entitled to
reimbursement for Liquidation Expenses with respect to a Mortgage Loan to the
extent that (i) any amounts with respect to such Mortgage Loan were paid as
Excess Liquidation Proceeds pursuant to clause (x) of this Subsection (a) to
the
Master Servicer; and (ii) such Liquidation Expenses were not included in the
computation of such Excess Liquidation Proceeds;
(iv) to
reimburse the Master Servicer, the Company or a Servicer for any Advance or
Servicing Advance, after a Realized Loss has been allocated with respect to
the
related Mortgage Loan if the Advance or Servicing Advance has not been
reimbursed pursuant to clauses (i) through (iii);
(v) to
pay
the Master Servicer as set forth in Section 4.09;
(vi) to
reimburse the Master Servicer for expenses, costs and liabilities incurred
by
and reimbursable to it pursuant to Sections 4.02, 8.04(c) and (d) and 12.02
or
otherwise reimbursable to it pursuant to this Agreement;
(vii) to
pay to
the Master Servicer, as additional master servicing compensation, any Excess
Liquidation Proceeds to the extent not retained by the Company or the related
Servicer;
(viii) to
reimburse or pay the Company or the related Servicer any such amounts as are
due
thereto under this Agreement or the related Servicing Agreement and have not
been retained by or paid to the Company or the related Servicer, to the extent
provided herein and in the related Servicing Agreement;
(ix) to
reimburse the Trustee, the Custodian or the Securities Administrator for
expenses, costs and liabilities incurred by or reimbursable to it pursuant
to
this Agreement (to the extent not reimbursed from the Master Servicer Collection
Account in accordance with Section 5.07);
(x) to
remove
amounts deposited in error;
(xi) to
make
distributions to the Swap Administrator for payment to the Swap Provider as
provided in this Agreement; and
(xii) to
clear
and terminate the Distribution Account pursuant to Section 11.01.
(b) The
Master Servicer shall keep and maintain separate accounting, on a Mortgage
Loan
by Mortgage Loan basis, for the purpose of accounting for any reimbursement
from
the Distribution Account pursuant to subclauses (i) through (iv), inclusive,
and
(vi) or with respect to any such amounts which would have been covered by such
subclauses had the amounts not been retained by the Master Servicer without
being deposited in the Distribution Account under Section 5.08.
(c) On
each
Distribution Date, the Securities Administrator shall distribute the related
Interest Remittance Amount and Principal Distribution Amount to the extent
of
funds on deposit in the Distribution Account to the holders of the related
Certificates in accordance with Section 6.04.
ARTICLE
VI
DISTRIBUTIONS
AND ADVANCES
Section
6.01 Advances.
(a) The
Company shall make an Advance with respect to any EMC Mortgage Loan and deposit
such Advance in the Master Servicer Collection Account no later than 1:00 p.m.
Eastern time on the Remittance Date in immediately available funds. The Company
or the related Servicer, as applicable, shall be obligated to make any such
Advance only to the extent that such advance would not be a Nonrecoverable
Advance. If the Company or the related Servicer shall have determined that
it
has made a Nonrecoverable Advance or that a proposed Advance or a lesser portion
of such Advance would constitute a Nonrecoverable Advance, the Company or the
related Servicer, as the case may be, shall deliver (i) to the Securities
Administrator for the benefit of the Certificateholders constituting the
remaining portion of such Advance, if applicable, and (ii) to the Depositor,
the
Master Servicer, each Rating Agency, and the Trustee an Officer’s Certificate
setting forth the basis for such determination.
In
lieu
of making all or a portion of such Advance from its own funds, the Company
may
(i) cause to be made an appropriate entry in its records relating to the
Protected Account that any Amounts Held for Future Distribution has been used
by
the Company in discharge of its obligation to make any such Advance and (ii)
transfer such funds from the Protected Account to the Distribution Account.
Any
funds so applied and transferred shall be replaced by the Company by deposit
in
the Distribution Account, no later than the close of business on the Remittance
Date immediately preceding the Distribution Account Deposit Date on which such
funds are required to be distributed pursuant to this Agreement.
Unless
otherwise described in this Pooling and Servicing Agreement, each Servicer
shall
discontinue making advances with respect to any Mortgage Loan that becomes
90
days delinquent. In addition, subject to Section 4.08 of the Agreement, each
Servicer will charge off a related Mortgage Loan at the time such Mortgage
Loan becomes 180 days delinquent unless such Servicer reasonably believes that
it may be able to obtain a net recovery through foreclosure proceedings or
other
conversion of the related Mortgage Loan. Once a Mortgage Loan is charged off,
the related Servicer shall not be entitled to any additional Servicing Fee
for
such Mortgage Loan, except to the extent of any unpaid Servicing Fees and
expenses which shall be reimbursable from any recoveries on such Mortgage Loan,
and the Mortgage Loan shall be treated as a Liquidated Mortgage Loan giving
rise
to a Realized Loss. If the related Servicer determines that a net recovery
is
possible through foreclosure proceedings or other disposition of the Mortgage
Loan that becomes 90 days Delinquent, the related Servicer may continue making
advances on such Mortgage Loan.
The
Company shall be entitled to be reimbursed from the Protected Account for all
Advances of its own funds made pursuant to this Section as provided in Section
5.02. The obligation to make Advances with respect to any EMC Mortgage Loan
shall continue until such EMC Mortgage Loan is paid in full or the related
Mortgaged Property or related REO Property has been liquidated or until the
purchase or repurchase thereof (or substitution therefor) from the Trust Fund
pursuant to any applicable provision of this Agreement, except as otherwise
provided in this Section 6.01.
(b) If
the
Scheduled Payment on a Mortgage Loan that was due on a related Due Date and
is
delinquent other than as a result of application of the Relief Act and for
which
the Company or the related Servicer was required to make an Advance pursuant
to
this Agreement or the related Servicing Agreement exceeds the amount deposited
in the Master Servicer Collection Account which shall be used for an Advance
with respect to such Mortgage Loan, the Master Servicer will deposit in the
Master Servicer Collection Account not later than the Distribution Account
Deposit Date immediately preceding the related Distribution Date an amount
equal
to such deficiency, net of the Master Servicing Fee and the Servicing Fee for
such Mortgage Loan except to the extent the Master Servicer determines any
such
Advance to be nonrecoverable from Liquidation Proceeds, Insurance Proceeds
or
future payments on the Mortgage Loan for which such Advance was made. Subject
to
the foregoing, the Master Servicer shall continue to make such Advances through
the date that the Company or the related Servicer is required to do so under
this Agreement or the related Servicing Agreement, as applicable. If applicable,
on the Distribution Account Deposit Date, the Master Servicer shall present
an
Officer’s Certificate to the Trustee (i) stating that the Master Servicer elects
not to make an Advance in a stated amount and (ii) detailing the reason it
deems
the advance to be nonrecoverable. The Master Servicer may rely on any
non-recoverability determination of the Company or any Servicer.
Subject
to and in accordance with the provisions of Article IX hereof, in the event
the
Master Servicer fails to make such Advance, then the Trustee, as Successor
Master Servicer, shall be obligated to make such Advance, subject to the
provisions of this Section 6.01.
Section
6.02 Compensating
Interest Payments.
(a) In
the
event that there is a Prepayment Interest Shortfall arising from a voluntary
Principal Prepayment in part or in full by the Mortgagor with respect to any
EMC
Mortgage Loan, the Company shall, to the extent of the Servicing Fee for such
Distribution Date, remit to the Master Servicer for deposit into the Master
Servicer Collection Account, as a reduction of the Servicing Fee for such
Distribution Date, no later than the close of business on the Remittance Date
immediately preceding such Distribution Date, an amount equal to such Prepayment
Interest Shortfall; and in case of such deposit, the Company shall not be
entitled to any recovery or reimbursement from the Depositor, the Trustee,
the
Seller, the Master Servicer, the Securities Administrator, the Trust Fund or
the
Certificateholders.
(b) The
Master Servicer shall enforce the obligation of each Servicer under the related
Servicing Agreement to remit any required Compensating Interest to the Master
Servicer Collection Account on the Remittance Date.
(c) The
Master Servicer shall be required to remit to the Securities Administrator
for
deposit in the Distribution Account the amount of any Compensating Interest,
to
the extent of the Master Servicing Compensation for such Distribution Date,
in
the event the Company or the related Servicer is required to make such payment
but fails to do so.
Section
6.03 REMIC
Distributions.
On
each
Distribution Date, the Securities Administrator shall be deemed to have
allocated distributions to the REMIC Regular Interests and the REMIC III Regular
Interests in accordance with Section 6.07 hereof.
Section
6.04 Distributions.
(a) Subject
to Section 4.14(c), on each Distribution Date, an amount equal to the Interest
Funds and Principal Funds for such Distribution Date shall be withdrawn by
the
Securities Administrator to the extent of any such funds in the Distribution
Account and distributed in the following order of priority:
(1) Interest
Funds shall be distributed in the following manner and order of
priority:
(A) To
the
Class A Certificates, the Current Interest and any Interest Carry Forward
Amount; and
(B) From
remaining Interest Funds, sequentially, to the Class X-0, Xxxxx X-0, Class
M-3,
Class M-4, Class M-5, Class M-6, Class B-1, Class B-2, Class B-3 and Class
B-4
Certificates, in that order, the Current Interest for each such
Class.
Any
Excess Spread to the extent necessary to meet a level of overcollateralization
equal to the Overcollateralization Target Amount will be the Extra Principal
Distribution Amount and will be included as part of the Principal Distribution
Amount. Any Remaining Excess Spread together with any Overcollateralization
Release Amount will be applied as Excess Cashflow and distributed pursuant
to
clauses (a)(3)(A) through (H) below.
On
any
Distribution Date, any Relief Act Interest Shortfalls and any related Prepayment
Interest Shortfalls to the extent not covered by Compensating Interest will
be
allocated as set forth in the definition of “Current Interest”
herein.
(2) Principal
Funds, including any Extra Principal Distribution Amount, shall be distributed
in the following manner and order of priority:
(A) For
each
Distribution Date (i) prior to the Stepdown Date or (ii) on which a Trigger
Event is in effect:
(i) To
the
Class A Certificates, the Principal Distribution Amount for such Distribution
Date, until the Certificate Principal Balance thereof is reduced to
zero;
(ii) To
the
Class M-1 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero;
(iii) To
the
Class M-2 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero;
(iv) To
the
Class M-3 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero;
(v) To
the
Class M-4 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero;
(vi) To
the
Class M-5 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero;
(vii) To
the
Class M-6 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero;
(viii) To
the
Class B-1 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero;
(ix) To
the
Class B-2 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero;
(x) To
the
Class B-3 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero; and
(xi) To
the
Class B-4 Certificates, from any remaining Principal Funds for such Distribution
Date, the remaining Principal Distribution Amount, until the Certificate
Principal Balance thereof is reduced to zero.
(B) For
each
Distribution Date on or after the Stepdown Date, so long as a Trigger Event
is
not in effect:
(i) To
the
Class A Certificates, the Class A Principal Distribution Amount for such
Distribution Date, until the Certificate Principal Balance thereof is reduced
to
zero;
(ii) To
the
Class M-1 Certificates, from any remaining Principal
Distribution Amount for such Distribution Date, the Class M-1 Principal
Distribution Amount, until the Certificate Principal Balance thereof is reduced
to zero;
(iii) To
the
Class M-2 Certificates, from any remaining Principal Distribution Amount for
such Distribution Date, the Class M-2 Principal Distribution Amount, until
the
Certificate Principal Balance thereof is reduced to zero;
(iv) To
the
Class M-3 Certificates, from any remaining Principal Distribution Amount for
such Distribution Date, the Class M-3 Principal Distribution Amount, until
the
Certificate Principal Balance thereof is reduced to zero;
(v) To
the
Class M-4 Certificates, from any remaining Principal Distribution Amount for
such Distribution Date, the Class M-4 Principal Distribution Amount, until
the
Certificate Principal Balance thereof is reduced to zero;
(vi) To
the
Class M-5 Certificates, from any remaining Principal Distribution Amount for
such Distribution Date, the Class M-5 Principal Distribution Amount, until
the
Certificate Principal Balance thereof is reduced to zero;
(vii) To
the
Class M-6 Certificates, from any remaining Principal Distribution Amount for
such Distribution Date, the Class M-6 Principal Distribution Amount, until
the
Certificate Principal Balance thereof is reduced to zero;
(viii) To
the
Class B-1 Certificates, from any remaining Principal Distribution Amount for
such Distribution Date, the Class B-1 Principal Distribution Amount, until
the
Certificate Principal Balance thereof is reduced to zero;
(ix) To
the
Class B-2 Certificates, from any remaining Principal Distribution Amount for
such Distribution Date, the Class B-2 Principal Distribution Amount, until
the
Certificate Principal Balance thereof is reduced to zero;
(x) To
the
Class B-3 Certificates, from any remaining Principal Distribution Amount for
such Distribution Date, the Class B-3 Principal Distribution Amount, until
the
Certificate Principal Balance thereof is reduced to zero; and
(xi) To
the
Class B-4 Certificates, from any remaining Principal Distribution Amount for
such Distribution Date, the Class B-4 Principal Distribution Amount, until
the
Certificate Principal Balance thereof is reduced to zero.
(3) Any
Excess Cashflow shall be distributed in the following manner and order of
priority:
(A) to
the
Class A Certificates, (a) first,
any
remaining Interest Carry Forward Amount due with respect to such Class to the
extent not fully paid pursuant to clause (a)(1)(A) above and Section 4.14(d)
and
(b) second,
any
Unpaid Realized Loss Amount for such Class for such Distribution Date in
accordance with the Applied Realized Loss Amount allocated to such Class to
the
extent not fully paid pursuant to Section 4.14(d);
(B) from
any
remaining Excess Cashflow, sequentially, to the Class X-0, Xxxxx X-0, Class
M-3,
Class M-4, Class M-5, Class M-6, Class B-1, Class B-2, Class B-3 and Class
B-4
Certificates, in that order, an amount equal to the Interest Carry Forward
Amount for each such Class for such Distribution Date, to the extent not fully
paid pursuant to Section 4.14(d);
(C) from
any
remaining Excess Cashflow otherwise distributable to the Class C Interest and
the Class C Certificates, to the Reserve Fund, (i) first, to pay to the Class
A
Certificates any Basis Risk Shortfall Carry Forward Amount for such Class for
such Distribution Date, if any, to the extent not fully paid pursuant to Section
4.14(d) and to the extent such amount exceeds the amounts then on deposit in
the
Reserve Fund, and (ii) second, to maintain a balance in the Reserve Fund equal
to the Reserve Fund Deposit;
(D) from
any
remaining Excess Cashflow otherwise distributable to the Class C Interest and
the Class C Certificates, to the Reserve Fund, (i) first, to pay to the Class
X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class B-1, Class
B-2, Class B-3 and Class B-4 Certificates, sequentially in that order, any
Basis
Risk Shortfall Carry Forward Amount for each such Class for such Distribution
Date,
if any,
to
the
extent not fully paid pursuant to Section 4.14(d) and to the extent such amount
exceeds the amounts then on deposit in the Reserve Fund, and (ii) second, to
maintain a balance in the Reserve Fund equal to the Reserve Fund
Deposit;
(E) from
any
remaining Excess Cashflow, sequentially to the Class A, Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class B-1, Class B-2, Class B-3
and
Class B-4 Certificates, in that order, the amount of Relief Act Shortfalls
and
any Prepayment Interest Shortfalls allocated to such Classes of Certificates,
to
the extent not previously reimbursed;
(F) from
any
remaining Excess Cashflow, to the Swap Administrator for payment to the Swap
Provider, any Swap Termination Payments due to a Swap Provider Trigger Event
owed by the Trust Fund (to the extent not paid by the Swap Administrator from
any upfront payment received pursuant to any replacement interest rate swap
agreement that may be entered into by the Supplemental Interest Trust
Trustee);
(G) from
any
remaining Excess Cashflow, to the Class C Interest and Class C Certificates,
an
amount equal to the Class C Distribution Amount reduced by amounts distributed
in clauses (C) and (D) above; and
(H) from
any
remaining Excess Cashflow to each of the Class R-1, Class R-2, Class R-3 and
Class RX Certificates, based on the related REMIC in which such amounts
remain.
On
each
Distribution Date, all amounts in respect of Prepayment Charges shall be
distributed to the Holders of the Class C Certificates, provided that such
distributions shall not be in reduction of the principal balance thereof.
In
addition, notwithstanding the foregoing clause (a)(2), to the extent a Class
IO
Distribution Amount is payable from principal collections, Principal
Distribution Amounts will be deemed paid to the most subordinate Class of
Regular Certificates, until the Certificate Principal Balance thereof has been
reduced to zero, and such amount will be paid pursuant to Section
4.14(f).
In
addition, notwithstanding the foregoing, on any Distribution Date after the
Distribution Date on which the Certificate Principal Balance of a Class of
Class
A, Class M or Class B Certificates has been reduced to zero, that Class of
Certificates will be retired and will no longer be entitled to distributions,
including distributions in respect of Prepayment Interest Shortfalls or Basis
Risk Shortfall Carry Forward Amounts.
(b) In
addition to the foregoing distributions, with respect to any Subsequent
Recoveries, the Company or the related Servicer, as applicable, shall deposit
such funds into the Protected Account pursuant to Section 5.01(b)(iii). If,
after taking into account such Subsequent Recoveries, the amount of a Realized
Loss is reduced, the amount of such Subsequent Recoveries will be applied to
increase the Certificate Principal Balance of the related Class of Certificates
with the highest payment priority to which Realized Losses have been allocated,
but not by more than the amount of Realized Losses previously allocated to
that
Class of Certificates pursuant to Section 6.05; provided, however, to the extent
that no reductions to a Certificate Principal Balance of any Class of
Certificates currently exists as the result of a prior allocation of a Realized
Loss, such Subsequent Recoveries will be applied as Excess Cashflow. The amount
of any remaining Subsequent Recoveries will be applied to increase the
Certificate Principal Balance of the Class of Certificates with the next highest
payment priority, up to the amount of such Realized Losses previously allocated
to that Class of Certificates pursuant to Section 6.05, and so on. Holders
of
such Certificates will not be entitled to any payment in respect of Current
Interest on the amount of such increases for any Interest Accrual Period
preceding the Distribution Date on which such increase occurs. Any such
increases shall be applied to the Certificate Principal Balance of each
Certificate of such Class in accordance with its respective Percentage
Interest.
(c) Subject
to Section 11.02 hereof respecting the final distribution, on each Distribution
Date the Securities Administrator shall make distributions to each
Certificateholder of record on the preceding Record Date either by wire transfer
in immediately available funds to the account of such Holder at a bank or other
entity having appropriate facilities therefor, if such Holder has so notified
the Securities Administrator at least 5 Business Days prior to the related
Record Date, or, if not, by check mailed by first class mail to such
Certificateholder at the address of such Holder appearing in the Certificate
Register. Notwithstanding the foregoing, but subject to Section 11.02 hereof
respecting the final distribution, distributions with respect to Certificates
registered in the name of a Depository shall be made to such Depository in
immediately available funds.
(d) On
or
before 5:00 p.m. Eastern time on the fourth Business Day immediately preceding
each Distribution Date (or at a time and date as is mutually agreed upon by
the
Securities Administrator and the Master Servicer), the Master Servicer shall
deliver the Remittance Report to the Securities Administrator.
Section
6.05 Allocation
of Realized Losses.
(a) All
Realized Losses on the Mortgage Loans shall be allocated by the Trustee on
each
Distribution Date as follows: first, to Excess Spread as part of the payment
in
respect of the Extra Principal Distribution Amount for such Distribution Date;
second, to the Class C Interest and Class C Certificates, until the Certificate
Principal Balance or Uncertificated Principal Balance thereof, as applicable,
has been reduced to zero; third, to the Class B-4 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero; fourth, to
the
Class B-3 Certificates, until the Certificate Principal Balance thereof has
been
reduced to zero; fifth, to the Class B-2 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; sixth, to the Class B-1
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; seventh, to the Class M-6 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; eighth, to the Class M-5 Certificates,
until the Certificate Principal Balance thereof has been reduced to zero; ninth,
to the Class M-4 Certificates, until the Certificate Principal Balance thereof
has been reduced to zero; tenth, to the Class M-3 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero; eleventh, to
the
Class M-2 Certificates, until the Certificate Principal Balance thereof has
been
reduced to zero; twelfth, to the Class M-1 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and thirteenth, to the Class
A Certificates. All Realized Losses to be allocated to the Certificate Principal
Balances of all Classes on any Distribution Date shall be so allocated after
the
actual distributions to be made on such date as provided above. All references
above to the Certificate Principal Balance of any Class of Certificates shall
be
to the Certificate Principal Balance of such Class immediately prior to the
relevant Distribution Date, before reduction thereof by any Realized Losses,
in
each case to be allocated to such Class of Certificates, on such Distribution
Date.
(b) Any
allocation of Realized Losses to a Class of Certificates or the Class C Interest
on any Distribution Date shall be made by reducing the Certificate Principal
Balance or Uncertificated Principal Balance thereof by the amount so allocated;
any allocation of Realized Losses to the Excess Spread shall be made by reducing
the amount otherwise payable in respect of the Class C Interest and the Class
C
Certificates pursuant to clause (G) of Section 6.04(a)(3).
Once
Realized Losses have been allocated to a Class of Class A, Class M or Class
B
Certificates, such amounts with respect to such Certificates will no longer
accrue interest nor will such amounts in respect of interest be reinstated
thereafter.
As
used
herein, an allocation of a Realized Loss on a “pro rata basis” among two or more
specified Classes of Certificates means an allocation on a pro rata basis,
among
the various Classes so specified, to each such Class of Certificates on the
basis of their then outstanding Certificate Principal Balances prior to giving
effect to distributions to be made on such Distribution Date. All Realized
Losses and all other losses allocated to a Class of Certificates hereunder
will
be allocated among the Certificates of such Class in proportion to the
Percentage Interests evidenced thereby.
(c) (i) All
Realized Losses on the Mortgage Loans shall be allocated on each Distribution
Date to REMIC I Regular Interest I-1-A through REMIC I Regular Interest I-45-B,
starting with the lowest numerical denomination until the Uncertificated
Principal Balance of each such REMIC I Regular Interest has been reduced to
zero; provided that, for REMIC I Regular Interests with the same numerical
denomination, such Realized Losses shall be allocated pro
rata
between
such REMIC I Regular Interests.
(ii) All
Realized Losses on the Mortgage Loans shall be allocated on each Distribution
Date to the following REMIC II Regular Interests in the following specified
percentages: first, to Uncertificated Accrued Interest payable to REMIC II
Regular Interest AA and REMIC II Regular Interest ZZ up to an aggregate amount
equal to the REMIC II Interest Loss Allocation Amount (without duplication
of
shortfalls allocated pursuant to Section 1.02), 98.00% and 2.00%, respectively;
second, to the Uncertificated Principal Balances of REMIC II Regular Interest
AA
and REMIC II Regular Interest ZZ up to an aggregate amount equal to the REMIC
II
Principal Loss Allocation Amount, 98.00% and 2.00%, respectively; third, to
the
Uncertificated Principal Balances of REMIC II Regular Interest AA, REMIC II
Regular Interest B-4 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest B-4 has been reduced to zero; fourth, to the Uncertificated Principal
Balances of REMIC II Regular Interest AA, REMIC II Regular Interest B-3 and
REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until
the
Uncertificated Principal Balance of REMIC II Regular Interest B-3 has been
reduced to zero; fifth, to the Uncertificated Principal Balances of REMIC II
Regular Interest AA, REMIC II Regular Interest B-2 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest B-2 has been reduced to zero; sixth, to
the
Uncertificated Principal Balances of REMIC II Regular Interest AA, REMIC II
Regular Interest B-1 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest B-1 has been reduced to zero; seventh, to the Uncertificated Principal
Balances of REMIC II Regular Interest AA, REMIC II Regular Interest M-6 and
REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until
the
Uncertificated Principal Balance of REMIC II Regular Interest M-6 has been
reduced to zero; eighth, to the Uncertificated Principal Balances of REMIC
II
Regular Interest AA, REMIC II Regular Interest M-5 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest M-5 has been reduced to zero; ninth, to
the
Uncertificated Principal Balances of REMIC II Regular Interest AA, REMIC II
Regular Interest M-4 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest M-4 has been reduced to zero; tenth, to the Uncertificated Principal
Balances of REMIC II Regular Interest AA, REMIC II Regular Interest M-3 and
REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until
the
Uncertificated Principal Balance of REMIC II Regular Interest M-3 has been
reduced to zero; eleventh, to the Uncertificated Principal Balances of REMIC
II
Regular Interest AA, REMIC II Regular Interest M-2 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest M-2 has been reduced to zero; twelfth,
to
the Uncertificated Principal Balances of REMIC II Regular Interest AA, REMIC
II
Regular Interest M-1 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest M-1 has been reduced to zero; and thirteenth, to the Uncertificated
Principal Balances of REMIC II Regular Interest AA, REMIC II Regular Interest
A
and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until
the Uncertificated Principal Balance of REMIC II Regular Interest A has been
reduced to zero.
Section
6.06 Monthly
Statements to Certificateholders.
(a) Not
later
than each Distribution Date, the Securities Administrator shall prepare and
make
available to each Holder of Certificates, the Trustee, the Swap Provider, the
Master Servicer and the Depositor a statement setting forth for the
Certificates:
(i) the
applicable record dates, accrual periods, determination dates for calculating
distributions and general distribution dates;
(ii) the
total
cash flows received and the general sources thereof;
(iii) the
amount, if any, of fees or expenses accrued and paid, with an identification
of
the payee and the general purpose of such fees including the related amount
of
the Servicing Fees paid to or retained by the applicable Servicer for the
related Due Period;
(iv) the
amount of the related distribution to Holders of the Class A, Class M and Class
B Certificates (by class) allocable to principal, separately identifying (A)
the
aggregate amount of any Principal Prepayments included therein, (B) the
aggregate of all scheduled payments of principal included therein and (C) the
Extra Principal Distribution Amount (if any);
(v) the
amount of such distribution to Holders of the Class A, Class M and Class B
Certificates allocable to interest and the portion thereof (if any), provided
by
the Swap Agreement and the amount of coverage remaining;
(vi) the
Interest Carry Forward Amounts and any Basis Risk Shortfall Carry Forward
Amounts for the Class A, Class M and Class B Certificates (if any);
(vii) the
Pass-Through Rate for each Class of Class A, Class M and Class B Certificates
with respect to the current Accrual Period, and, if applicable, whether such
Pass-Through Rate was limited by the related Net
WAC
Cap Rate;
(viii) the
Certificate Principal Balance of the Class A, Class M and Class B Certificates
before and after giving effect (i) to all distributions allocable to principal
on such Distribution Date and (ii) the allocation of any Applied Realized Loss
Amounts for such Distribution Date;
(ix) the
number and Stated Principal Balance of all the Mortgage Loans for such
Distribution Date, together with updated pool composition information including
the following: weighted average mortgage rate and weighted average remaining
term;
(x) the
aggregate amount of Advances included in the distribution on such Distribution
Date (including the general purpose of such Advances), the aggregate amount
of
unreimbursed Advances as of the end of the Due Period, and the general source
of
funds for reimbursements;
(xi) the
number and aggregate Stated Principal Balance of the Mortgage Loans (A)
Delinquent, exclusive of Mortgage Loans in foreclosure, (1) 30 days Delinquent,
(2) 60 days Delinquent and (3) 90 days or more Delinquent, (B) in foreclosure
and Delinquent (1) 30 days Delinquent, (2) 60 days Delinquent and (3) 90 days
or
more Delinquent, in each case as of the close of business on the last day of
the
calendar month preceding such Distribution Date and (C) in bankruptcy and
delinquent (1) 30 days Delinquent, (2) 60 days Delinquent and (3) 90 days or
more Delinquent, in each case as of the close of business on the last day of
the
calendar month preceding such Distribution Date;
(xii) the
amount of, if any, of excess cashflow or excess spread and the application
of
such excess cashflow;
(xiii) with
respect to any Mortgage Loan that was liquidated during the preceding calendar
month, the aggregate Stated Principal Balance of, and Realized Loss on, such
Mortgage Loans as of the end of the Due Period;
(xiv) whether
a
Trigger Event exists;
(xv) information
on loss, delinquency or other tests used for determining early amortization,
liquidation, stepdowns or other performance triggers as more completely
described in the prospectus supplement and whether the trigger was
met;
(xvi) the
total
number and principal balance of any real estate owned or REO Properties as
of
the end of the related Due Period;
(xvii) the
cumulative Realized Losses through the end of the preceding month;
(xviii) the
amount of the distribution made on such Distribution Date to the Holders of
the
Class C Certificates allocable to Prepayment Charges;
(xix) the
Sixty-Day Plus Delinquency Percentage
(xx) if
applicable, material modifications, extensions or waivers to Mortgage Loan
terms, fees, penalties or payments during the preceding calendar month or that
have become material over time;
(xxi) material
breaches of Mortgage Loan representations or warranties or transaction
covenants;
(xxii) the
amount of the Prepayment Charges remitted by the master servicer and the amount
on deposit in
the
reserve fund;
(xxiii) the
amount of any Net Swap Payment payable to the Trust, any Net Swap Payment
payable to the Swap Provider, any Swap Termination Payment payable to the Trust
and any Swap Termination Payment payable to the Swap Provider.
(xxiv) information
regarding any new issuance of securities backed by the same asset pool, any
pool
asset changes, such as additions or removals of Mortgage Loans from the Trust
Fund, if applicable; and
(xxv) any
material changes in the solicitation, credit-granting, underwriting,
origination, acquisition or Mortgage Loan selection criteria or procedures,
as
applicable, used to originate, acquire or select Mortgage Loans for the Trust
Fund.
The
Depositor covenants that if there is a material change in the solicitation,
credit-granting, underwriting, origination, acquisition or Mortgage Loan
selection criteria or procedures, as applicable, used to originate, acquire
or
select Mortgage Loans for the Trust Fund that it will notify the Securities
Administrator five calendar days before each Distribution Date, and if no such
notification occurs, the Securities Administrator has no obligation to report
with respect to (xxv). The Depositor covenants to the Securities Administrator
that there will be no new issuance of securities backed by the same asset pool,
so the Securities Administrator will only be responsible in (xxiv) above for
reporting any pool asset changes, such as additions or removals of Mortgage
Loans from the Trust Fund.
The
foregoing information and reports shall be prepared and determined by the
Securities Administrator based solely on Mortgage Loan data provided to the
Securities Administrator by the Master Servicer (in a format agreed to by the
Securities Administrator and the Master Servicer) no later than four (4)
Business Days (or at a time and date as is mutually agreed upon by the
Securities Administrator and the Master Servicer), prior to the Distribution
Date. In preparing or furnishing the foregoing information, the Securities
Administrator shall be entitled to rely conclusively on the accuracy of the
information or data regarding the Mortgage Loans and the related REO Property
that has been provided to the Securities Administrator by the Master Servicer,
and the Securities Administrator shall not be obligated to verify, recompute,
reconcile or recalculate any such information or data. The Securities
Administrator shall be entitled to conclusively rely on the Mortgage Loan data
provided by the Master Servicer and shall have no liability for any errors
in
such Mortgage Loan data.
The
Securities Administrator will make such statement (and, at its option, any
additional files containing the same information in an alternative format)
available each month to the parties hereto, the Certificateholders and each
Rating Agency via the Securities Administrator’s internet website. The
Securities Administrator’s internet website shall initially be located at
xxx.xxxxxxxx.xxx.
Assistance in using the website can be obtained by calling the Securities
Administrator at (000) 000-0000. Parties that are unable to use the above
distribution option are entitled to have a paper copy mailed to them via first
class mail by calling the Securities Administrator and indicating such. The
Securities Administrator shall have the right to change the way such statements
are distributed in order to make such distribution more convenient and/or more
accessible to the above parties and the Securities Administrator shall provide
timely and adequate notification to all above parties regarding any such
changes.
As
a
condition to access the Securities Administrator’s internet website, the
Securities Administrator may require registration and the acceptance of a
disclaimer. The Securities Administrator will not be liable for the
dissemination of information in accordance with this Agreement.
(b) The
Securities Administrator’s responsibility for making the above information
available to the Certificateholders is limited to the availability, timeliness
and accuracy of the information derived from the Master Servicer, the Company
and the related Servicers. The Securities Administrator will make available
a
copy of each statement provided pursuant to this Section 6.06 to each Rating
Agency on its website at xxx.xxxxxxxx.xxx.
(c) Within
a
reasonable period of time after the end of each calendar year, the Securities
Administrator shall cause to be furnished upon written request to each Person
who at any time during the calendar year was a Certificateholder, a statement
containing the information set forth in clauses (a)(i) and (a)(ii) of this
Section 6.06 aggregated for such calendar year or applicable portion thereof
during which such Person was a Certificateholder. Such obligation of the
Securities Administrator shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Securities
Administrator pursuant to any requirements of the Code as from time to time
in
effect.
(d) The
Securities Administrator shall furnish quarterly to the Holders of the Residual
Certificates each applicable Form 1066Q and shall respond promptly to written
requests made not more frequently than quarterly by any Holder of a Residual
Certificate with respect to the following matters:
(i) The
original projected principal and interest cash flows on the Closing Date on
each
class of Regular Interests and Residual Interests created hereunder and on
the
related Mortgage Loans, based on the Prepayment Assumption;
(ii) The
projected remaining principal and interest cash flows as of the end of any
calendar quarter with respect to each class of Regular Interests and Residual
Interests created hereunder and the related Mortgage Loans, based on the
Prepayment Assumption;
(iii) The
applicable Prepayment Assumption and any interest rate assumptions used in
determining the projected principal and interest cash flows described
above;
(iv) The
original issue discount (or, in the case of the Mortgage Loans, market discount)
or premium accrued or amortized through the end of such calendar quarter with
respect to each class of Regular Interests or Residual Interests created
hereunder and to the related Mortgage Loans, together with each constant yield
to maturity used in computing the same;
(v) The
treatment of losses realized with respect to the related Mortgage Loans or
the
Regular Interests created hereunder, including the timing and amount of any
cancellation of indebtedness income of a REMIC with respect to such Regular
Interests or bad debt deductions claimed with respect to the related Mortgage
Loans;
(vi) The
amount and timing of any non-interest expenses of a REMIC; and
(vii) Any
taxes
(including penalties and interest) imposed on the REMIC, including, without
limitation, taxes on “prohibited transactions,” “contributions” or “net income
from foreclosure property” or state or local income or franchise
taxes.
The
information pursuant to clauses (i), (ii), (iii) and (iv) above shall be
provided by the Depositor pursuant to Section 10.12.
Section
6.07 REMIC
Designations and REMIC Distributions.
(a) The
Securities Administrator on behalf of the Trustee shall elect that each of
REMIC
I, REMIC II, REMIC III, REMIC IV and REMIC V shall be treated as a REMIC under
Section 860D of the Code. Any inconsistencies or ambiguities in this Agreement
or in the administration of this Agreement shall be resolved in a manner that
preserves the validity of such REMIC elections. The assets of REMIC I shall
include the Mortgage Loans and all interest owing in respect of and principal
due thereon, the Distribution Account, the Master Servicer Collection Account,
the Protected Accounts maintained by the Company and the related Servicer,
any
REO Property, any proceeds of the foregoing and any other assets related to
the
Mortgage Loans subject to this Agreement (other than the Reserve Fund, any
Prepayment Charge Waiver Amounts and, for the avoidance of doubt, the
Supplemental Interest Trust, the Swap Agreement, the Swap Account and any rights
or obligations in respect of the Swap Administration Agreement). The REMIC
I
Regular Interests shall constitute the assets of REMIC II. The REMIC II Regular
Interests shall constitute the assets of REMIC III. The Class C Interest shall
constitute the assets of REMIC IV. The Class IO Interest shall constitute the
assets of REMIC V.
(b) (1)On
each
Distribution Date, the following amounts, in the following order of priority,
shall be distributed by REMIC I to REMIC II on account of the REMIC I Regular
Interests or withdrawn from the Distribution Account and distributed to the
Holders of the Class R-1 Certificates, as the case may be:
(i) from
Interest Funds and Principal Funds, in each case determined without regard
to
the related clause (2)(ii) of the definitions thereof, to holders of each of
the
REMIC I Regular Interests I-1-A through I-45-B, pro
rata,
in an
amount equal to (A) the Uncertificated Accrued Interest for such REMIC I Regular
Interests for such Distribution Date, plus (B) any amounts payable in respect
thereof remaining unpaid from previous Distribution Dates;
(ii) to
the
extent of Interest Funds and Principal Funds, in each case determined without
regard to the related clause (2)(ii) of the definitions thereof, remaining
after
the distribution made pursuant to clause (i) above, to REMIC I Regular Interests
I-1-A through I-45-B, starting with the lowest numerical denomination, until
the
Uncertificated Principal Balances of each such REMIC I Regular Interest is
reduced to zero; provided that, for REMIC I Regular Interests with the same
numerical denomination, such payments of principal shall be allocated
pro
rata
between
such REMIC I Regular Interests; and
(iii) any
remaining amount to the Holders of the Class R-1 Certificates.
(2) On
each
Distribution Date, amounts representing Prepayment Charges on the Mortgage
loans
shall be deemed distributed to the REMIC I Regular Interests, pro
rata, provided
that such amounts shall not reduce the Uncertificated Principal Balances of
the
REMIC I Regular Interests.
(c) (1) On
each
Distribution Date, the following amounts, in the following order of priority,
shall be distributed by REMIC II to REMIC III on account of the REMIC II Regular
Interests or withdrawn from the Distribution Account and distributed to the
Holders of the Class R-2 Certificates, as the case may be:
(i) from
Interest Funds and Principal Funds, in each case determined without regard
to
the related clause (2)(ii) of the definitions thereof, to the holders of REMIC
II Regular Interest IO, in an amount equal to (A) the Uncertificated Accrued
Interest for such REMIC II Regular Interest for such Distribution Date, plus
(B)
any amounts in respect thereof remaining unpaid from previous Distribution
Dates;
(ii) to
the
extent of the Interest Funds and Principal Funds, in each case determined
without regard to the related clause (2)(ii) of the definitions thereof,
remaining after the distribution pursuant to clause (i), to the holders of
each
REMIC II Regular Interest (other than REMIC II Regular Interest IO),
pro
rata,
in an
amount equal to (A) the Uncertificated Accrued Interest for such REMIC II
Regular Interest for such Distribution Date, plus (B) any amounts in respect
thereof remaining unpaid from previous Distribution Dates. Amounts payable
as
Uncertificated Accrued Interest in respect of REMIC II Regular Interest ZZ
shall
be reduced when the REMIC II Overcollateralization Amount is less than the
REMIC
II Required Overcollateralization Amount, by the lesser of (x) the amount of
such difference and (y) the Maximum Uncertificated Accrued Interest Deferral
Amount, and such amount will be payable to the holders of each REMIC II Regular
Interest for which a Class A, Class M or Class B Certificate is the
Corresponding Certificate in the same proportion as the Extra Principal
Distribution Amount is allocated to the Corresponding Certificates for each
such
REMIC II Regular Interest, and the Uncertificated Principal Balance of REMIC
II
Regular Interest ZZ shall be increased by such amount;
(iii) to
the
holders of REMIC II Regular Interests (other than REMIC II Regular Interest
IO)
in an amount equal to the remainder of the Interest Funds and Principal Funds,
in each case determined without regard to the related clause (2)(ii) of the
definitions thereof, for such Distribution Date after the distributions made
pursuant to clauses (i) and (ii) above, allocated as follows:
(A) 98%
of
such remainder to the holders of REMIC II Regular Interest AA, until the
Uncertificated Principal Balance of such REMIC II Regular Interest is reduced
to
zero;
(B) 2%
of
such remainder, first, to the holders of each REMIC II Regular Interest for
which a Class A, Class M or Class B Certificate is the Corresponding
Certificate, in an aggregate amount equal to 1% of and in the same proportion
as
principal payments are allocated to the Corresponding Certificates for each
such
REMIC II Regular Interest, until the Uncertificated Principal Balances of such
REMIC II Regular Interests are reduced to zero; and second, to the holders
of
REMIC II Regular Interest ZZ, until the Uncertificated Principal Balance of
such
REMIC II Regular Interest is reduced to zero; and
(C) any
remaining amount to the Holders of the Class R-2 Certificates.
(2) On
each
Distribution Date, 100% of the Prepayment Charges deemed distributed on the
REMIC I Regular Interests shall be distributed, pro
rata, to
the
holders of the REMIC II Regular Interests (other than REMIC II Regular Interest
IO), provided that such amounts shall not reduce the Uncertificated Principal
Balances of the REMIC II Regular Interests.
(d) On
each
Distribution Date, interest shall be deemed payable from REMIC III to the
holders of each REMIC III Regular Interest the ownership of which is represented
by the Class A, Class M and Class B Certificates at a pass-through rate equal
to
the lesser of (i) the Pass-Through Rate for the Corresponding Certificate
determined without regard to the Net WAC Cap Rate and (ii) the Net WAC Cap
Rate
for the REMIC III Regular Interest the ownership of which is represented by
the
Corresponding Certificate for such Distribution Date, in each case on a
principal balance equal to the Certificate Principal Balance of the
Corresponding Certificate for such Distribution Date. For the avoidance of
doubt, principal shall be payable to, and shortfalls, losses and prepayments
shall be allocable to, the REMIC III Regular Interests the ownership of which
is
represented by the Class A, Class M and Class B Certificates as such amounts
are
payable and allocable to the Corresponding Certificates.
(e) On
each
Distribution Date, an amount equal to the aggregate amount distributed pursuant
to Sections 6.04(a)(3)(C), (D) and (G) on such date shall be deemed distributed
from REMIC III to REMIC IV in respect of the Class C Distribution Amount
distributable to the Class C Interest, and 100% of the Prepayment Charges deemed
distributed on the REMIC II Regular Interests shall be deemed distributed from
REMIC III to REMIC IV in respect of the Class C Interest.
(f) On
each
Distribution Date, 100% of the amounts deemed distributed on REMIC II Regular
Interest IO on such date shall be deemed distributed by REMIC III to REMIC
V in
respect of the Class IO Interest. Such amounts shall be deemed distributed
by
REMIC V in respect of REMIC V Regular Interest IO for deposit into the
Supplemental Interest Trust.
ARTICLE
VII
THE
CERTIFICATES
Section
7.01 The
Certificates.
The
Certificates shall be substantially in the forms attached hereto as Exhibits
A-1
through A-5. The Certificates shall be issuable in registered form, in the
minimum dollar denominations, integral dollar multiples in excess thereof
(except that one Certificate of each Class may be issued in a different amount
which must be in excess of the applicable minimum dollar denomination) and
aggregate dollar denominations as set forth in the following table:
|
Class
|
Minimum
Denomination
|
Integral
Multiple
in
Excess
of
Minimum
|
Original
Certificate
Principal
Balance or Notional Amount
|
|||
|
A
|
$
|
100,000
|
$
|
1.00
|
$ |
351,075,000.00
|
|
M-1
|
$
|
100,000
|
$
|
1.00
|
$ |
20,108,000.00
|
|
M-2
|
$
|
100,000
|
$
|
1.00
|
$ |
20,108,000.00
|
|
M-3
|
$
|
100,000
|
$
|
1.00
|
$ |
7,165,000.00
|
|
M-4
|
$
|
100,000
|
$
|
1.00
|
$ |
6,471,000.00
|
|
M-5
|
$
|
100,000
|
$
|
1.00
|
$ |
6,240,000.00
|
|
M-6
|
$
|
100,000
|
$
|
1.00
|
$ |
6,009,000.00
|
|
B-1
|
$
|
100,000
|
$
|
1.00
|
$ |
5,316,000.00
|
|
B-2
|
$
|
100,000
|
$
|
1.00
|
$ |
4,622,000.00
|
|
B-3
|
$
|
100,000
|
$
|
1.00
|
$ |
5,778,000.00
|
|
B-4
|
$
|
100,000
|
$
|
1.00
|
$ |
6,240,000.00
|
|
C
|
$
|
10%
|
$
|
1%
|
$ |
462,245,008.63 (1)
|
|
R-1
|
$
|
100%
|
$
|
X/X
|
X/X
|
|
|
X-0
|
$
|
100%
|
$
|
X/X
|
X/X
|
|
|
X-0
|
$
|
100%
|
$
|
N/A
|
N/A
|
|
|
RX
|
$
|
100%
|
$
|
N/A
|
N/A
|
|
(1) This
is a
Notional Amount.
The
Certificates shall be executed by manual or facsimile signature on behalf of
the
Securities Administrator by an authorized officer. Certificates bearing the
manual or facsimile signatures of individuals who were, at the time when such
signatures were affixed, authorized to sign on behalf of the Securities
Administrator shall bind the Securities Administrator, notwithstanding that
such
individuals or any of them have ceased to be so authorized prior to the
authentication and delivery of such Certificates or did not hold such offices
at
the date of such authentication and delivery. No Certificate shall be entitled
to any benefit under this Agreement, or be valid for any purpose, unless there
appears on such Certificate the countersignature of the Securities Administrator
by manual signature, and such countersignature upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been
duly
countersigned and delivered hereunder. All Certificates shall be dated the
date
of their countersignature. On the Closing Date, the Securities Administrator
shall authenticate the Certificates to be issued at the written direction of
the
Depositor, or any affiliate thereof.
The
Depositor shall provide, or cause to be provided, to the Securities
Administrator on a continuous basis, an adequate inventory of Certificates
to
facilitate transfers.
Section
7.02 Certificate
Register; Registration of Transfer and Exchange of Certificates.
(a) The
Securities Administrator shall maintain, or cause to be maintained in accordance
with the provisions of Section 7.09 hereof, a Certificate Register for the
Trust
Fund in which, subject to the provisions of subsections (b) and (c) below and
to
such reasonable regulations as it may prescribe, the Securities Administrator
shall provide for the registration of Certificates and of Transfers and
exchanges of Certificates as herein provided. Upon surrender for registration
of
Transfer of any Certificate, the Securities Administrator shall authenticate
and
deliver, in the name of the designated transferee or transferees, one or more
new Certificates of the same Class and of like aggregate Percentage
Interest.
At
the
option of a Certificateholder, Certificates may be exchanged for other
Certificates of the same Class in authorized denominations and evidencing the
same aggregate Percentage Interest upon surrender of the Certificates to be
exchanged at the office or agency of the Securities
Administrator.
Whenever any Certificates are so surrendered for exchange, the Securities
Administrator
shall
execute, authenticate, and deliver the Certificates that the Certificateholder
making the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of Transfer or exchange shall be accompanied by
a
written instrument of Transfer in form satisfactory to the Securities
Administrator
duly
executed by the holder thereof or his attorney duly authorized in
writing.
No
service charge to the Certificateholders shall be made for any registration
of
Transfer or exchange of Certificates, but payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
Transfer or exchange of Certificates may be required.
All
Certificates surrendered for registration of Transfer or exchange shall be
canceled and subsequently destroyed by the Securities
Administrator
in
accordance with the Securities
Administrator’s
customary procedures.
(b) Subject
to Section 7.07 and, in the case of any Global Certificate or Private
Certificate upon the satisfaction of the conditions set forth below, upon
surrender for registration of transfer of any Certificate at any office or
agency of the Securities Administrator maintained for such purpose, the
Securities Administrator shall sign, countersign and shall deliver, in the
name
of the designated transferee or transferees, a new Certificate of a like Class
and aggregate Percentage Interest, but bearing a different number.
(c) Subject
to Section 7.02(g), so long as a Global Certificate of such Class is outstanding
and is held by or on behalf of the Depository, transfers of beneficial interests
in such Global Certificate, or transfers by Holders of Individual Certificates
of such Class to transferees that take delivery in the form of beneficial
interests in the Global Certificate, may be made only in accordance with this
Section 7.02(c) and in accordance with the rules of the Depository:
(i) In
the
case of a beneficial interest in the Global Certificate being transferred to
an
Institutional Accredited Investor, such transferee shall be required to take
delivery in the form of an Individual Certificate or Certificates and the
Securities Administrator shall register such transfer only upon compliance
with
the provisions of Section 7.02(h).
(ii) In
the
case of a beneficial interest in a Class of Global Certificates being
transferred to a transferee that takes delivery in the form of an Individual
Certificate or Certificates of such Class, except as set forth in clause (i)
above, the Securities Administrator shall register such transfer only upon
compliance with the provisions of Section 7.02(h).
(iii) In
the
case of an Individual Certificate of a Class being transferred to a transferee
that takes delivery in the form of a beneficial interest in a Global Certificate
of such Class, the Securities Administrator shall register such transfer if
the
transferee has provided the Securities Administrator with a Rule 144A and
Related Matters Certificate or comparable evidence as to its QIB
status.
(iv) No
restrictions shall apply with respect to the transfer or registration of
transfer of a beneficial interest in the Global Certificate of a Class to a
transferee that takes delivery in the form of a beneficial interest in the
Global Certificate of such Class; provided that each such transferee shall
be
deemed to have made such representations and warranties contained in the Rule
144A and Related Matters Certificate as are sufficient to establish that it
is a
QIB.
(d) Subject
to Section 7.02(g), an exchange of a beneficial interest in a Global Certificate
of a Class for an Individual Certificate or Certificates of such Class, an
exchange of an Individual Certificate or Certificates of a Class for a
beneficial interest in the Global Certificate of such Class and an exchange
of
an Individual Certificate or Certificates of a Class for another Individual
Certificate or Certificates of such Class (in each case, whether or not such
exchange is made in anticipation of subsequent transfer, and, in the case of
the
Global Certificate of such Class, so long as such Certificate is outstanding
and
is held by or on behalf of the Depository) may be made only in accordance with
this Section 7.02(d) and in accordance with the rules of the
Depository:
(i) A
Holder
of a beneficial interest in a Global Certificate of a Class may at any time
exchange such beneficial interest for an Individual Certificate or Certificates
of such Class.
(ii) A
Holder
of an Individual Certificate or Certificates of a Class may exchange such
Certificate or Certificates for a beneficial interest in the Global Certificate
of such Class if such holder furnishes to the Securities Administrator a Rule
144A and Related Matters Certificate or comparable evidence as to its QIB
status.
(iii) A
Holder
of an Individual Certificate of a Class may exchange such Certificate for an
equal aggregate principal amount of Individual Certificates of such Class in
different authorized denominations without any certification.
(e) (i)Upon
acceptance for exchange or transfer of an Individual Certificate of a Class
for
a beneficial interest in a Global Certificate of such Class as provided herein,
the Securities Administrator shall cancel such Individual Certificate and shall
(or shall request the Depository to) endorse on the schedule affixed to the
applicable Global Certificate (or on a continuation of such schedule affixed
to
the Global Certificate and made a part thereof) or otherwise make in its books
and records an appropriate notation evidencing the date of such exchange or
transfer and an increase in the certificate balance of the Global Certificate
equal to the certificate balance of such Individual Certificate exchanged or
transferred therefor.
(ii) Upon
acceptance for exchange or transfer of a beneficial interest in a Global
Certificate of a Class for an Individual Certificate of such Class as provided
herein, the Securities Administrator shall (or shall request the Depository
to)
endorse on the schedule affixed to such Global Certificate (or on a continuation
of such schedule affixed to such Global Certificate and made a part thereof)
or
otherwise make in its books and records an appropriate notation evidencing
the
date of such exchange or transfer and a decrease in the certificate balance
of
such Global Certificate equal to the certificate balance of such Individual
Certificate issued in exchange therefor or upon transfer thereof.
(f) Any
Individual Certificate issued in exchange for or upon transfer of another
Individual Certificate or of a beneficial interest in a Global Certificate
shall
bear the applicable legends set forth in Exhibit A-2.
(g) Subject
to the restrictions on transfer and exchange set forth in this Section 7.02,
the
Holder of any Individual Certificate may transfer or exchange the same in whole
or in part (in an initial certificate balance equal to the minimum authorized
denomination set forth in Section 7.01 above or any integral multiple of $1.00
in excess thereof) by surrendering such Certificate at the Corporate Trust
Office, or at the office of any transfer agent, together with an executed
instrument of assignment and transfer satisfactory in form and substance to
the
Securities Administrator in the case of transfer and a written request for
exchange in the case of exchange. The Holder of a beneficial interest in a
Global Certificate may, subject to the rules and procedures of the Depository,
cause the Depository (or its nominee) to notify the Securities Administrator
in
writing of a request for transfer or exchange of such beneficial interest for
an
Individual Certificate or Certificates. Following a proper request for transfer
or exchange, the Securities Administrator shall, within five Business Days
of
such request made at the Corporate Trust Office, sign, countersign and deliver
at the Corporate Trust Office, to the transferee (in the case of transfer)
or
Holder (in the case of exchange) or send by first class mail at the risk of
the
transferee (in the case of transfer) or Holder (in the case of exchange) to
such
address as the transferee or Holder, as applicable, may request, an Individual
Certificate or Certificates, as the case may require, for a like aggregate
Percentage Interest and in such authorized denomination or denominations as
may
be requested. The presentation for transfer or exchange of any Individual
Certificate shall not be valid unless made at the Corporate Trust Office by
the
registered Holder in person, or by a duly authorized
attorney-in-fact.
(h) No
Transfer of a Private Certificate shall be made unless such Transfer is made
pursuant to an effective registration statement under the Securities Act and
any
applicable state securities laws or is exempt from the registration requirements
under the Securities Act and such state securities laws. In the event that
a
Transfer is to be made in reliance upon an exemption from the Securities Act
and
such laws, in order to assure compliance with the Securities Act and such laws,
the Certificateholder desiring to effect such Transfer and such
Certificateholder’s prospective transferee shall each certify to the Trustee and
the Securities Administrator in writing the facts (or shall be deemed to certify
in the case of a Book-Entry Certificate) surrounding the Transfer by (x)(i)
the
delivery to the Securities Administrator by the Certificateholder desiring
to
effect such transfer of a certificate substantially in the form set forth in
Exhibit D (the “Transferor Certificate”) and (ii) the delivery by the
Certificateholder’s prospective transferee of (A) a letter in substantially the
form of Exhibit E (the “Investment Letter”) if the prospective transferee is an
Institutional Accredited Investor or (B) a letter in substantially the form
of
Exhibit F (the “Rule 144A and Related Matters Certificate”) if the prospective
transferee is a QIB or (y) there shall be delivered to the Trustee and the
Securities Administrator an Opinion of Counsel addressed to the Trustee and
the
Securities Administrator that such Transfer may be made pursuant to an exemption
from the Securities Act, which Opinion of Counsel shall not be an expense of
the
Depositor, the Seller, the Master Servicer, the Securities
Administrator
or the
Trustee. Notwithstanding the provisions of the immediately preceding sentence,
no restrictions shall apply with respect to the transfer or registration of
transfer of a beneficial interest in any Certificate that is a Global
Certificate of a Class to a transferee that takes delivery in the form of a
beneficial interest in the Global Certificate of such Class provided that each
such transferee shall be deemed to have made such representations and warranties
contained in the Rule 144A and Related Matters Certificate as are sufficient
to
establish that it is a QIB. The Securities Administrator shall provide to any
Holder of a Private Certificate and any prospective transferee designated by
any
such Holder, information regarding the Certificates and the Mortgage Loans
and
such other information as shall be necessary to satisfy the condition to
eligibility set forth in Rule 144A(d)(4) for Transfer of any such Certificate
without registration thereof under the Securities Act pursuant to the
registration exemption provided by Rule 144A. The Trustee, the Securities
Administrator and the Master Servicer shall cooperate with the Depositor in
providing the Rule 144A information referenced in the preceding sentence,
including providing to the Depositor such information regarding the
Certificates, the Mortgage Loans and other matters regarding the Trust Fund
as
the Depositor shall reasonably request to meet its obligation under the
preceding sentence. Each Holder of a Private Certificate desiring to effect
such
Transfer shall, and does hereby agree to, indemnify the Trustee, the Depositor,
the Seller, the Securities Administrator and the Master Servicer against any
liability that may result if the Transfer is not so exempt or is not made in
accordance with such federal and state laws.
No
transfer of any Class C Certificate shall be made unless the transferee of
such
Class C Certificate provides to the Securities Administrator the appropriate
tax
certification form (i.e., IRS Form W-9 or IRS Form W-8BEN, W-8IMY, or W-8ECI,
as
applicable (or any successor form thereto)), as a condition to such transfer
and
agrees to update such forms (i) upon expiration of any such form, (ii) as
required under then applicable U.S. Treasury regulations and (iii) promptly
upon
learning that any IRS Form W-9 or IRS Form W-8BEN, W-8IMY, or W-8ECI, as
applicable (or any successor form thereto), has become obsolete or incorrect.
Upon receipt of any such tax certification form from a transferee of any Class
C
Certificate, the Securities Administrator shall provide a copy of such tax
certification form to the Supplemental Interest Trust Trustee. The Supplemental
Interest Trust Trustee shall provide a copy of any such tax certification form
to the Swap Provider.
The
Securities Administrator shall be entitled to rely conclusively on any
certificate required by this Section 7.02 to be executed in connection with
the
transfer of any Certificate, and shall be entitled to presume conclusively
the
continuing accuracy thereof from time to time, in each case without further
inquiry or investigation.
The
Securities Administrator shall not be responsible for ascertaining whether
any
transfer complies with, or for otherwise monitoring or determining compliance
with, the requirements or terms of the 1933 Act, applicable state securities
laws, ERISA or the Code; except that if a Certificate is required by the terms
of this Section 7.02 to be provided to the Securities Administrator by a
prospective transferor or transferee, the Securities Administrator shall examine
the same to determine whether it conforms substantially on its face to the
applicable requirements of this Section 7.02 and that if an opinion of counsel
is provided, the Securities Administrator shall examine the same to determine
whether it meets the requirements hereof.
No
Transfer of an ERISA Restricted Certificate or Class B-4 Certificate shall
be
made at any time unless either (i) the transferee of such Certificate provides
a
representation, or is deemed to represent in the case of a Global Certificate,
to the Securities Administrator acceptable to and in form and substance
satisfactory to the Securities Administrator to the effect that such transferee
is not a Plan, or a Person acting on behalf of a Plan or using the assets of
a
Plan, or (ii) in the case of any such Certificate presented for registration
in
the name of a Plan, or a trustee of a Plan or any other person acting on behalf
of a Plan, the Securities Administrator shall have received an Opinion of
Counsel for the benefit of the Trustee, the Securities Administrator and the
Master Servicer and on which they may rely, satisfactory to the Securities
Administrator, to the effect that the purchase and holding of such Certificate
are permissible under applicable law, will not result in any prohibited
transactions under ERISA or Section 4975 of the Code and will not subject the
Trustee, the Securities Administrator, the Master Servicer or the Depositor
to
any obligation in addition to those expressly undertaken in this Agreement,
which Opinion of Counsel shall not be an expense of the Trustee, the Securities
Administrator, the Master Servicer or the Depositor, or (iii) in the case of
a
Class B-4 Certificate, the transferee provides a representation, or is deemed
to
represent in the case of the Global Certificate, or an opinion of counsel to
the
effect that the proposed transfer or holding of such Class B-4 Certificate
and
the servicing, management and operation of the Trust and its assets: (I) will
not result in any prohibited transaction which is not covered under a prohibited
transaction exemption (“PTE”), including but not limited to XXX 00-00, XXX
00-00, XXX 00-0, XXX 95-60 or PTE 96-23 and (II) will not give rise to any
obligation on the part of the Depositor, the Master Servicer, the Securities
Administrator or the Trustee in addition to those expressly undertaken in this
Agreement. Notwithstanding anything else to the contrary herein, any purported
transfer of an ERISA Restricted Certificate to or on behalf of a Plan without
the delivery of the Opinion of Counsel as described above shall be void and
of
no effect; provided that the restriction set forth in this sentence shall not
be
applicable if there has been delivered to the Trustee and the Securities
Administrator an Opinion of Counsel meeting the requirements of clause (ii)
of
the first sentence of this paragraph. Neither the Trustee, the Securities
Administrator nor the Master Servicer shall be required to monitor, determine
or
inquire as to compliance with the transfer restrictions with respect to any
ERISA Restricted Certificate that is a Book-Entry Certificate, and neither
the
Trustee nor the Master Servicer shall have any liability for transfers of any
such Book-Entry Certificates made through the book-entry facilities of any
Depository or between or among participants of the Depository or Certificate
Owners made in violation of the transfer restrictions set forth herein. Neither
the Trustee, the Securities Administrator nor the Master Servicer shall be
under
any liability to any Person for any registration of transfer of any ERISA
Restricted Certificate that is in fact not permitted by this Section 7.02(h)
or
for making any payments due on such Certificate to the Holder thereof or taking
any other action with respect to such Holder under the provisions of this
Agreement.
Prior
to
the termination of the related Supplemental Interest Trust, no Transfer of
a
related Class A Certificate or Class M or Class B Certificate (other than a
Class B-4 Certificate) shall be made unless either (i) the Securities
Administrator shall have received a representation from the transferee
of such Certificate acceptable to and in form and substance satisfactory
to the
Securities Administrator, or is deemed to represent in the case of a Global
Certificate, that such transferee is not an employee benefit plan subject
to
Section 406 of ERISA or a plan subject to Section 4975 of the Code (either
a
"Plan"), or a Person acting on behalf of a Plan or using the assets a Plan,
or
(ii) the transferee provides a representation, or is deemed to represent
in the
case of the Global Certificate that (A) such plan is an accredited investor
within the meaning of the Exemption and (B) the proposed transfer or holding
of
such Certificate are eligible for exemptive relief under Prohibited Transaction
Class Exemption ("PTCE") 84-14, XXXX 00-00, XXXX 00-0, XXXX 95-60 or PTCE
96-23.
Subsequent
to the termination of the Supplemental Interest Trust, each beneficial owner
of
a related Class M or Class B Certificate (other than a Class B-4
Certificate) or any interest therein shall be deemed to have represented,
by
virtue of its acquisition or holding of that certificate or interest therein,
that either (a)(i) it is not a Plan or investing with "Plan Assets", (ii)
it has
acquired and is holding such certificate in reliance on the Exemption, and
that
it understands that there are certain conditions to the availability of the
Exemption, including that the certificate must be rated, at the time of
purchase, not lower than "BBB-" (or its equivalent) by S&P, Fitch or
Xxxxx’x, and the certificate is so rated or (iii) (1) it is an insurance
company, (2) the source of funds used to acquire or hold the certificate
or
interest therein is an "insurance company general account," as such term
is
defined in PTCE 95-60, and (3) the conditions in Sections I and III of PTCE
95-60 have been satisfied.
Neither
the Trustee, the Securities Administrator nor the Master Servicer will be
required to monitor, determine or inquire as to compliance with the transfer
restrictions with respect to the Global Certificates. Any attempted or purported
transfer of any Certificate in violation of the provisions of this Section
7.02
shall be void ab initio and such Certificate shall be considered to have been
held continuously by the prior permitted Certificateholder. Any transferor
of
any Certificate in violation of such provisions, shall indemnify and hold
harmless the Trustee, the Securities Administrator and the Master Servicer
from
and against any and all liabilities, claims, costs or expenses incurred by
the
Trustee, the Securities Administrator or the Master Servicer as a result of
such
attempted or purported transfer. Neither the Securities Administrator shall
have
any liability for transfer of any such Global Certificates in or through
book-entry facilities of any Depository or between or among Depository
Participants or Certificate Owners made in violation of the transfer
restrictions set forth herein. The Securities Administrator shall be entitled,
but not obligated, to recover from any Holder of any ERISA Restricted
Certificate that was in fact a Plan or a Person acting on behalf of a Plan
at
the time it became a Holder or, at such subsequent time as it became a Plan
or
Person acting on behalf of a Plan, all payments made on such ERISA Restricted
Certificate at and after either such time. Any such payments so recovered by
the
Securities Administrator shall be paid and delivered by the Securities
Administrator to the last preceding Holder of such Certificate that is not
a
Plan or Person acting on behalf of a Plan.
(i) Each
Person who has or who acquires any Ownership Interest in a Residual Certificate
shall be deemed by the acceptance or acquisition of such Ownership Interest
to
have agreed to be bound by the following provisions, and the rights of each
Person acquiring any Ownership Interest in a Residual Certificate are expressly
subject to the following provisions:
(i) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall be a Permitted Transferee and shall promptly notify the Securities
Administrator
of any
change or impending change in its status as a Permitted Transferee.
(ii) No
Ownership Interest in a Residual Certificate may be registered on the Closing
Date or thereafter transferred, and the Securities
Administrator
shall
not register the Transfer of any Residual Certificate unless, in addition to
the
certificates required to be delivered to the Securities
Administrator
under
subsection (b) above, the Securities
Administrator
shall
have been furnished with an affidavit (a “Transfer Affidavit”) of the initial
owner or the proposed transferee in the form attached hereto as Exhibit
C.
(iii) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall agree (A) to obtain a Transfer Affidavit from any other Person to whom
such Person attempts to Transfer its Ownership Interest in a Residual
Certificate, (B) to obtain a Transfer Affidavit from any Person for whom such
Person is acting as nominee, trustee or agent in connection with any Transfer
of
a Residual Certificate and (C) not to Transfer its Ownership Interest in a
Residual Certificate or to cause the Transfer of an Ownership Interest in a
Residual Certificate to any other Person if it has actual knowledge that such
Person is not a Permitted Transferee.
(iv) Any
attempted or purported Transfer of any Ownership Interest in a Residual
Certificate in violation of the provisions of this Section 7.02(i) shall be
absolutely null and void and shall vest no rights in the purported Transferee.
If any purported transferee shall become a Holder of a Residual Certificate
in
violation of the provisions of this Section 7.02(i), then the last preceding
Permitted Transferee shall be restored to all rights as Holder thereof
retroactive to the date of registration of Transfer of such Residual
Certificate. Neither the Securities Administrator nor the Trustee shall be
under
liability to any Person for any registration of Transfer of a Residual
Certificate that is in fact not permitted by Section 7.02(h) and this Section
7.02(i) or for making any payments due on such Certificate to the Holder thereof
or taking any other action with respect to such Holder under the provisions
of
this Agreement so long as the Transfer was registered after receipt of the
related Transfer Affidavit. The Securities Administrator shall be entitled
but
not obligated to recover from any Holder of a Residual Certificate that was
in
fact not a Permitted Transferee at the time it became a Holder or, at such
subsequent time as it became other than a Permitted Transferee, all payments
made on such Residual Certificate at and after either such time. Any such
payments so recovered by the Securities
Administrator
shall be
paid and delivered by the Securities Administrator to the last preceding
Permitted Transferee of such Certificate.
(v) The
Master Servicer shall make available within 60 days of written request from
the
Securities
Administrator,
all
information necessary to compute any tax imposed under Section 860E(e) of the
Code as a result of a Transfer of an Ownership Interest in a Residual
Certificate to any Holder who is not a Permitted Transferee.
The
restrictions on Transfers of a Residual Certificate set forth in this Section
7.02(i) shall cease to apply (and the applicable portions of the legend on
a
Residual Certificate may be deleted) with respect to Transfers occurring after
delivery to the Securities Administrator of an Opinion of Counsel addressed
to
the Securities Administrator, which Opinion of Counsel shall not be an expense
of the Trustee, the Securities Administrator, the Seller or the Master Servicer
to the effect that the elimination of such restrictions, or any Transfer of
a
Residual Certificate allowed by such elimination, will not cause REMIC I, REMIC
II, REMIC III, REMIC IV or REMIC V, as applicable, to fail to qualify as a
REMIC
at any time that the Certificates are outstanding or result in the imposition
of
any tax on the Trust Fund, a Certificateholder or another Person. Each Person
holding or acquiring any Ownership Interest in a Residual Certificate hereby
consents to any amendment of this Agreement that, based on an Opinion of Counsel
addressed to the Securities Administrator and furnished to the Securities
Administrator, is reasonably necessary (a) to ensure that the record ownership
of, or any beneficial interest in, a Residual Certificate is not transferred,
directly or indirectly, to a Person that is not a Permitted Transferee and
(b)
to provide for a means to compel the Transfer of a Residual Certificate that
is
held by a Person that is not a Permitted Transferee to a Holder that is a
Permitted Transferee.
(j) The
preparation and delivery of all certificates and opinions referred to above
in
this Section 7.02 shall not be an expense of the Trust Fund, the Trustee, the
Depositor, the Seller, the Securities
Administrator
or the
Master Servicer.
Section
7.03 Mutilated,
Destroyed, Lost or Stolen Certificates.
If
(a)
any mutilated Certificate is surrendered to the Securities Administrator, or
the
Securities Administrator receives evidence to its satisfaction of the
destruction, loss or theft of any Certificate and of the ownership thereof
and
(b) there is delivered to the Securities Administrator such security or
indemnity as may be required by them to save the Securities Administrator and
the Trustee harmless, then, in the absence of notice to the Securities
Administrator that such Certificate has been acquired by a bona fide purchaser,
the Securities Administrator shall execute, authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like Class, tenor and Percentage Interest.
In
connection with the issuance of any new Certificate under this Section 7.03,
the
Securities Administrator may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto
and
any other expenses (including the fees and expenses of the Securities
Administrator) connected therewith. Any replacement Certificate issued pursuant
to this Section 7.03 shall constitute complete and indefeasible evidence of
ownership in the Trust Fund, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time. All Certificates
surrendered to the Securities Administrator under the terms of this Section
7.03
shall be canceled and destroyed by the Securities Administrator in accordance
with its standard procedures without liability on its part.
Section
7.04 Persons
Deemed Owners.
The
Securities Administrator, the Trustee and any agent of the Securities
Administrator, the Trustee may treat the person in whose name any Certificate
is
registered as the owner of such Certificate for the purpose of receiving
distributions as provided in this Agreement and for all other purposes
whatsoever, and neither the Securities Administrator, the Trustee, nor any
agent
of the Securities Administrator or the Trustee shall be affected by any notice
to the contrary.
Section
7.05 Access
to
List of Certificateholders’ Names and Addresses.
If
three
or more Certificateholders, or in the case of Book-Entry Certificates,
Certificate Owners (a) request such information in writing from the Securities
Administrator, (b) state that such Certificateholders or Certificate Owners
desire to communicate with other Certificateholders or Certificate Owners with
respect to their rights under this Agreement or under the Certificates, and
(c)
provide a copy of the communication that such Certificateholders or Certificate
Owners propose to transmit or if the Depositor or the Master Servicer shall
request such information in writing from the Securities Administrator, then
the
Securities Administrator shall, within ten Business Days after the receipt
of
such request, provide the Depositor, the Master Servicer or such
Certificateholders or Certificate Owners at such recipients’ expense the most
recent list of the Certificateholders of the Trust Fund held by the Securities
Administrator, if any. The Depositor and every Certificateholder and Certificate
Owner, by receiving and holding a Certificate, agree that the Securities
Administrator shall not be held accountable by reason of the disclosure of
any
such information as to the list of the Certificateholders hereunder, regardless
of the source from which such information was derived.
Section
7.06 Book-Entry
Certificates.
The
Regular Certificates (other than the Class C Certificates), upon original
issuance, shall be issued in the form of one or more typewritten Certificates
representing the Book-Entry Certificates, to be delivered to the Depository
by
or on behalf of the Depositor. Such Certificates shall initially be registered
on the Certificate Register in the name of the Depository or its nominee, and
no
Certificate Owner of such Certificates will receive a definitive certificate
representing such Certificate Owner’s interest in such Certificates, except as
provided in Section 7.08. Unless and until definitive, fully registered
Certificates (“Definitive Certificates”) have been issued to the Certificate
Owners of such Certificates pursuant to Section 7.08:
(a) the
provisions of this Section shall be in full force and effect;
(b) the
Depositor, the Securities
Administrator
and the
Trustee may deal with the Depository and the Depository Participants for all
purposes (including the making of distributions) as the authorized
representative of the respective Certificate Owners of such
Certificates;
(c) registration
of the Book-Entry Certificates may not be transferred by the Securities
Administrator except to another Depository;
(d) the
rights of the respective Certificate Owners of such Certificates shall be
exercised only through the Depository and the Depository Participants and shall
be limited to those established by law and agreements between the Owners of
such
Certificates and the Depository and/or the Depository Participants. Pursuant
to
the Depository Agreement, unless and until Definitive Certificates are issued
pursuant to Section 7.08, the Depository will make book-entry transfers among
the Depository Participants and receive and transmit distributions of principal
and interest on the related Certificates to such Depository
Participants;
(e) the
Depository may collect its usual and customary fees, charges and expenses from
its Depository Participants;
(f) the
Securities
Administrator
may rely
and shall be fully protected in relying upon information furnished by the
Depository with respect to its Depository Participants; and
(g) to
the
extent that the provisions of this Section conflict with any other provisions
of
this Agreement, the provisions of this Section shall control.
For
purposes of any provision of this Agreement requiring or permitting actions
with
the consent of, or at the direction of, Certificateholders evidencing a
specified percentage of the aggregate unpaid principal amount of any Class
of
Certificates, such direction or consent may be given by Certificate Owners
(acting through the Depository and the Depository Participants) owning
Book-Entry Certificates evidencing the requisite percentage of principal amount
of such Class of Certificates.
The
Private Certificates shall initially be held in fully registered certificated
form. If at any time the Holders of all of the Certificates of one or more
such
Classes request that the Securities Administrator cause such Class to become
Global Certificates, the Depositor (with the assistance of the Securities
Administrator) will take such action as may be reasonably required to cause
the
Depository to accept such Class or Classes for trading if it may legally be
so
traded. If at anytime there are to be Global Certificates, the Global
Certificates shall be delivered to the Depository by the Depositor or deposited
with the Securities Administrator as custodian for the Depository.
All
transfers by Certificate Owners of such respective Classes of Book-Entry
Certificates and any Global Certificates shall be made in accordance with the
procedures established by the Depository Participant or brokerage firm
representing such Certificate Owners. Each Depository Participant shall only
transfer Book-Entry Certificates of Certificate Owners it represents or of
brokerage firms for which it acts as agent in accordance with the Depository’s
normal procedures.
Section
7.07 Notices
to Depository.
Whenever
any notice or other communication is required to be given to Certificateholders
of a Class with respect to which Book-Entry Certificates have been issued,
unless and until Definitive Certificates shall have been issued to the related
Certificate Owners, the Securities Administrator shall give all such notices
and
communications to the Depository.
Section
7.08 Definitive
Certificates.
If,
after
Book-Entry Certificates have been issued with respect to any Certificates,
(a)
the Depositor or the Depository advises the Securities Administrator that the
Depository is no longer willing or able to discharge properly its
responsibilities under the Depository Agreement with respect to such
Certificates and the Depositor is unable to locate a qualified successor or
(b)
the Depositor, with the consent of Depository Participants, advises the
Securities Administrator that it elects to terminate the book-entry system
with
respect to such Certificates through the Depository, then the Securities
Administrator shall notify all Certificate Owners of such Certificates, through
the Depository, of the occurrence of any such event and of the availability
of
Definitive Certificates to applicable Certificate Owners requesting the same.
The Depositor shall provide the Securities Administrator with an adequate
inventory of certificates to facilitate the issuance and transfer of Definitive
Certificates. Upon surrender to the Securities Administrator of any such
Certificates by the Depository, accompanied by registration instructions from
the Depository for registration, the Securities Administrator shall countersign
and deliver such Definitive Certificates. Neither the Depositor nor the
Securities Administrator shall be liable for any delay in delivery of such
instructions and each may conclusively rely on, and shall be protected in
relying on, such instructions.
In
addition, if an Event of Default has occurred and is continuing, each
Certificate Owner materially adversely affected thereby may at its option
request a Definitive Certificate evidencing such Certificate Owner’s Voting
Rights in the related Class of Certificates. In order to make such request,
such
Certificate Owner shall, subject to the rules and procedures of the Depository,
provide the Depository or the related Depository Participant with directions
for
the Securities Administrator to exchange or cause the exchange of the
Certificate Owner’s interest in such Class of Certificates for an equivalent
Voting Right in fully registered definitive form. Upon receipt by the Securities
Administrator of instructions from the Depository directing the Securities
Administrator to effect such exchange (such instructions to contain information
regarding the Class of Certificates and the Certificate Principal Balance being
exchanged, the Depository Participant account to be debited with the decrease,
the registered holder of and delivery instructions for the definitive
Certificate, and any other information reasonably required by the Securities
Administrator), (i) the Securities Administrator shall instruct the Depository
to reduce the related Depository Participant’s account by the aggregate
Certificate Principal Balance of the definitive Certificate, (ii) the Securities
Administrator shall execute, authenticate and deliver, in accordance with the
registration and delivery instructions provided by the Depository, a definitive
Certificate evidencing such Certificate Owner’s Voting Rights in such Class of
Certificates and (iii) the Securities Administrator shall execute and
authenticate a new Book-Entry Certificate reflecting the reduction in the
Certificate Principal Balance of such Class of Certificates by the amount of
the
definitive Certificates.
Section
7.09 Maintenance
of Office or Agency.
The
Securities Administrator will maintain or cause to be maintained at its expense
an office or offices or agency or agencies located at LaSalle Bank National
Association, 000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000, Attn: Global Securities and
Trust
Services Group - SACO 2006-9,
where
Certificates may be surrendered for registration of transfer or exchange. The
Securities Administrator initially designates its Corporate Trust Office, as
the
office for such purposes. The Securities Administrator will give prompt written
notice to the Certificateholders of any change in such location of any such
office or agency.
ARTICLE
VIII
THE
DEPOSITOR, THE COMPANY AND THE MASTER SERVICER
Section
8.01 Liabilities
of the Depositor, the Company and the Master Servicer.
Each
of
the Depositor, the Company and the Master Servicer shall be liable in accordance
herewith only to the extent of the obligations specifically imposed upon and
undertaken by it herein.
Section
8.02 Merger
or
Consolidation of the Depositor, the Company or the Master Servicer.
(a) Each
of
the Depositor, the Company and the Master Servicer will keep in full force
and
effect its existence, rights and franchises as a limited liability company
under
the laws of the state of its formation, a corporation under the laws of the
state of its incorporation or as a national banking association under federal
law, as applicable, 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, the Certificates or any of the Mortgage Loans
and to perform its duties under this Agreement.
(b) Any
Person into which the Depositor, the Company or the Master Servicer may be
merged or consolidated, or any corporation resulting from any merger or
consolidation to which the Depositor, the Company or the Master Servicer shall
be a party, or any Person succeeding to the business of the Depositor, the
Company or the Master Servicer, shall be the successor of the Depositor, the
Company or the Master Servicer hereunder, without the execution or filing of
any
paper or further act on the part of any of the parties hereto, anything herein
to the contrary notwithstanding.
Section
8.03 Indemnification
of the Trustee, the Master Servicer and the Securities
Administrator.
(a) The
Master Servicer agrees to indemnify the Indemnified Persons for, and to hold
them harmless against, any loss, liability or expense (including reasonable
legal fees and disbursements of counsel) incurred on their part that may be
sustained in connection with, arising out of, or relating to, any claim or
legal
action (i) related to the Master Servicer’s failure to perform its duties in
compliance with this Agreement (except as any such loss, liability or expense
shall be otherwise reimbursable pursuant to this Agreement) or (ii) incurred
by
reason of the Master Servicer’s willful misfeasance, bad faith or gross
negligence in the performance of its duties hereunder or by reason of reckless
disregard of obligations and duties hereunder, provided, in each case, that
with
respect to any such claim or legal action (or pending or threatened claim or
legal action), the affected Indemnified Person shall have given the Master
Servicer and EMC written notice thereof promptly after such Person shall have
with respect to such claim or legal action knowledge thereof; provided, however
that the failure to give such notice shall not relieve the Master Servicer
of
its indemnification obligations hereunder except to the extent the Master
Servicer is prejudiced thereby. This indemnity shall survive the resignation
or
removal of the Trustee, Master Servicer or the Securities Administrator and
the
termination of this Agreement.
(b) The
Company agrees to indemnify the Indemnified Persons and to hold them harmless
from and against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees and related costs, judgments, and any other costs,
fees
and expenses that the Indemnified Persons may sustain in any way related to
(i)
the failure of the Company to perform in any way its duties hereunder and
service the EMC Mortgage Loans in strict compliance with the terms of this
Agreement, (ii) breach of any representation or warranty of the Company
contained herein or (iii) incurred by reason of the Company’s willful
misfeasance, bad faith or negligence in the performance of its duties hereunder
or by reason of reckless disregard of its obligations and duties hereunder.
The
Company shall immediately notify the Master Servicer and the Trustee if a claim
is made by a third party with respect to this Agreement or the EMC Mortgage
Loans, assume (with the consent of the Master Servicer and the Trustee and
with
counsel reasonably satisfactory to the Master Servicer and the Trustee) the
defense of any such claim and pay all expenses in connection therewith,
including counsel fees, and promptly pay, discharge and satisfy any judgment
or
decree which may be entered against it or any Indemnified Person in respect
of
such claim but failure of the Company to give such notice shall not limit its
obligations hereunder. The Company agrees that it will not enter into any
settlement of any such claim without the consent of the Indemnified Persons
unless such settlement includes an unconditional release of such Indemnified
Persons from all liability that is the subject matter of such claim. The
provisions of this Section 8.03(b) shall survive termination of this
Agreement.
(c) EMC
will
indemnify any Indemnified Person for any loss, liability or expense of any
Indemnified Person not otherwise paid or covered pursuant to subsection (b)
above. Such indemnification shall survive termination of this
Agreement.
Section
8.04 Limitations
on Liability of the Depositor, the Company, the Master Servicer and
Others.
(a) Subject
to the obligation of the Company and the Master Servicer to indemnify the
Indemnified Persons pursuant to Section 8.03, neither the Depositor, the
Company, the Master Servicer nor any of the directors, officers, employees
or
agents of the Depositor, the Company and the Master Servicer shall be under
any
liability to the Indemnified Persons, the Trust Fund or the Certificateholders
for taking any action or for refraining from taking any action in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Depositor, the Company, the Master Servicer
or any such Person against any breach of warranties or representations made
herein or any liability which would otherwise be imposed by reason of such
Person’s willful misfeasance, bad faith or gross negligence in the performance
of duties or by reason of reckless disregard of obligations and duties
hereunder.
(b) The
Depositor, the Company, the Master Servicer and the Securities Administrator
and
any of their respective directors, officers, employees or agents 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.
(c) The
Depositor, the Company, the Master Servicer, the Securities Administrator,
the
Trustee, each Custodian, LaSalle Bank National Association in its individual
capacity and any director, officer, employee or agent of the Depositor, the
Company, the Master Servicer, the Securities Administrator, the Trustee and
each
Custodian shall be indemnified by the Trust and held harmless thereby against
any loss, liability or expense (including reasonable legal fees and
disbursements of counsel) incurred on their part that may be sustained in
connection with, arising out of, or related to, any claim or legal action
(including any pending or threatened claim or legal action) relating to, or
the
performance of its obligations under, this Agreement, the Assignment Agreement,
the Custodial Agreements, the Certificates or Servicing Agreements, other than
(i) in the case of the Company, the Master Servicer or the Securities
Administrator, any such loss, liability or expense related to the Company’s or
the Master Servicer’s or Securities Administrator’s failure to perform its
respective duties in compliance with this Agreement or (ii) in the case of
the
Company, the Master Servicer or the Securities Administrator, any such loss,
liability or expense incurred by reason of the Company’s or the Master
Servicer’s or the Securities Administrator’s willful misfeasance, bad faith or
gross negligence in the performance of duties hereunder, or by reason of
reckless disregard of obligations and duties hereunder or under the Custodial
Agreement, as applicable, (iii) in the case of the Trustee, any such loss,
liability or expense incurred by reason of the Trustee’s willful misfeasance,
bad faith or negligence in the performance of its duties hereunder, or by reason
of its reckless disregard of obligations and duties hereunder and (iv) in the
case of either Custodian, any such loss, liability or expense incurred by reason
of such Custodian’s willful misfeasance, bad faith or negligence in the
performance of its duties under the related Custodial Agreement, or by reason
of
its reckless disregard of obligations and duties thereunder. Such
indemnification shall survive termination of this Agreement.
(d) None
of
the Depositor, the Company, the Master Servicer or the Securities Administrator
shall be under any obligation to appear in, prosecute or defend any legal action
that is not incidental to its duties under this Agreement and that in its
opinion may involve it in any expense or liability; provided, however, the
Master Servicer may in its discretion, undertake any such action which it may
deem necessary or desirable with respect to this Agreement and the rights and
duties of the parties hereto and the interests of the Certificateholders
hereunder. In such event, the legal expenses and costs of such action and any
liability resulting therefrom (except any loss, liability or expense incurred
by
reason of willful misfeasance, bad faith or negligence in the performance of
duties hereunder or by reason of reckless disregard of obligations and duties
hereunder) shall be expenses, costs and liabilities of the Trust Fund, and
the
Master Servicer shall be entitled to be reimbursed therefor out of the Master
Servicer Collection Account as provided by Section 5.02. Nothing in this
Subsection 8.04(d) shall affect the Master Servicer’s obligation to master
service the Mortgage Loans pursuant to Section 4.01.
(e) In
taking
or recommending any course of action pursuant to this Agreement, unless
specifically required to do so pursuant to this Agreement, the Master Servicer
shall not be required to investigate or make recommendations concerning
potential liabilities which the Trust might incur as a result of such course
of
action by reason of the condition of the Mortgaged Properties but shall give
notice to the Trustee if it has notice of such potential
liabilities.
(f) The
Master Servicer shall not be liable for any acts or omissions of the Company
or
the related Servicers.
(g) The
Master Servicer may perform any of its duties hereunder or exercise its rights
hereunder either directly of through Affiliates, agents or
attorneys.
Section
8.05 Master
Servicer and Company Not to Resign.
(a) Except
as
provided in Section 8.07, the Master Servicer shall not resign from the
obligations and duties hereby imposed on it except (i) with the prior consent
of
the Trustee (which
consent shall not be unreasonably withheld or delayed)
or (ii)
upon a determination that any such duties hereunder are no longer permissible
under applicable law and such impermissibility cannot be cured. Any such
determination permitting the resignation of the Master Servicer shall be
evidenced by an Opinion of Counsel, addressed to and delivered to, the Trustee.
No such resignation by the Master Servicer shall become effective until the
Trustee or a successor to the Master Servicer reasonably satisfactory to the
Trustee shall have assumed the responsibilities and obligations of the Master
Servicer in accordance with Section 9.02 hereof. The Trustee shall notify each
Rating Agency of the resignation of the Master Servicer.
(b) The
Company shall not resign from the obligations and duties hereby imposed on
it
except (i) upon the assignment of its servicing duties with respect to all
or a
portion of the EMC Mortgage Loans to an institution that is a Xxxxxx Xxx and
Xxxxxxx Mac approved seller/servicer in good standing that has a net worth
of
not less than $15,000,000 and with the prior written consent of the Master
Servicer (which consent shall not be unreasonably withheld or delayed) or (ii)
upon the determination that its duties hereunder are no longer permissible
under
applicable law and such incapacity cannot be cured by the Company. Any
determination permitting the resignation of the Company shall be evidenced
by an
Opinion of Counsel to such effect addressed to and delivered, to the Master
Servicer and the Trustee which Opinion of Counsel shall be in form and substance
acceptable to the Master Servicer and the Trustee. No appointment of a successor
to the Company shall be effective hereunder unless (a) the Rating Agencies
have
confirmed in writing that such appointment will not result in a downgrade,
qualification or withdrawal of the then current ratings assigned to the
Certificates, (b) such successor shall have represented that it is meets the
eligibility criteria set forth in clause (i) above, and (c) such successor
has
agreed to assume the obligations of the Company hereunder to the extent of
the
EMC Mortgage Loans to be serviced by such successor. The Company shall provide
a
copy of the written confirmation of the Rating Agencies and the agreement
executed by such successor to the Master Servicer and the Trustee. No such
resignation shall become effective until a qualified successor or the Master
Servicer shall have assumed the Company’s responsibilities and obligations
hereunder. The Company shall notify the Master Servicer, the Trustee and the
Rating Agencies of the resignation of the Company or the assignment of all
or a
portion of its servicing duties hereunder in accordance with this Section
8.05.
Section
8.06 Successor
Master Servicer.
In
connection with the appointment of any Successor Master Servicer or the
assumption of the duties of the Master Servicer, EMC or the Trustee may make
such arrangements for the compensation of such Successor Master Servicer out
of
payments on the Mortgage Loans as EMC or the Trustee and such Successor Master
Servicer shall agree. If the Successor Master Servicer does not agree that
such
market value is a fair price, such Successor Master Servicer shall obtain two
quotations of market value from third parties actively engaged in the servicing
of single-family mortgage loans. In no event shall the compensation of any
Successor Master Servicer exceed that permitted the Master Servicer hereunder
without the consent of all of the Certificateholders.
Section
8.07 Sale
and
Assignment of Master Servicing.
The
Master Servicer may sell and assign its rights and delegate its duties and
obligations in their entirety as Master Servicer under this Agreement and EMC
may terminate the Master Servicer without cause and select a new Master
Servicer; provided, however, that: (i) the purchaser or transferee accepting
such assignment and delegation (a) shall be a Person which shall be qualified
to
service mortgage loans for Xxxxxx Mae or Xxxxxxx Mac; (b) shall have a net
worth
of not less than $15,000,000 (unless otherwise approved by each Rating Agency
pursuant to clause (ii) below) and meets the eligibility requirements herein
to
serve as Master Servicer and Securities Administrator; (c) shall be reasonably
satisfactory to the Trustee (as evidenced in a writing signed by the Trustee);
and (d) shall execute and deliver to the Trustee an agreement, in form and
substance reasonably satisfactory to the Trustee, which contains an assumption
by such Person of the due and punctual performance and observance of each
responsibility, covenant and condition of the Master Servicer and the Securities
Administrator under this Agreement and each Custodial Agreement from and after
the effective date of such assumption agreement; (ii) each Rating Agency shall
be given prior written notice of the identity of the proposed successor to
the
Master Servicer and each Rating Agency’s rating of the Certificates in effect
immediately prior to such assignment, sale and delegation will not be
downgraded, qualified or withdrawn as a result of such assignment, sale and
delegation, as evidenced by a letter to such effect delivered to the Master
Servicer, the Securities Administrator and the Trustee; and (iii) the Master
Servicer assigning and selling the master servicing shall deliver to the Trustee
an Officer’s Certificate and an Opinion of Counsel addressed to the Trustee,
each stating that all conditions precedent to such action under this Agreement
have been satisfied and such action is permitted by and complies with the terms
of this Agreement.
ARTICLE
IX
DEFAULT;
TERMINATION OF MASTER SERVICER; TERMINATION OF COMPANY
Section
9.01 Events
of
Default.
“Event
of
Default,” wherever used herein, means any one of the following
events:
(i) any
failure by the Master Servicer to remit to the Securities Administrator any
amounts received or collected by the Master Servicer in respect of the Mortgage
Loans and required to be remitted by it hereunder (other than any Advance),
which failure shall continue unremedied for one Business Day after the date
on
which written notice of such failure shall have been given to the Master
Servicer by the Trustee or the Depositor, or to the Trustee and the Master
Servicer by the Holders of Certificates evidencing not less than 25% of the
Voting Rights evidenced by the Certificates; or
(ii) other
than with respect to clause (viii) below, any failure by the Master Servicer
to
observe or perform in any material respect any other of the covenants or
agreements on the part of the Master Servicer contained in this Agreement or
any
breach of a representation or warranty by the Master Servicer, which failure
or
breach shall continue unremedied for a period of 60 days after the date on
which
written notice of such failure shall have been given to the Master Servicer
by
the Trustee or the Depositor, or to the Trustee and the Master Servicer by
the
Holders of Certificates evidencing not less than 25% of the Voting Rights
evidenced by the Certificates; or
(iii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
in
the premises for the appointment of a receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs, shall have
been entered against the Master Servicer and such decree or order shall have
remained in force undischarged or unstayed for a period of 60 consecutive days;
or
(iv) the
Master Servicer shall consent to the appointment of a receiver or liquidator
in
any insolvency, readjustment of debt, marshalling of assets and liabilities
or
similar proceedings of or relating to the Master Servicer or all or
substantially all of the property of the Master Servicer; or
(v) the
Master Servicer shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of, or commence a
voluntary case under, any applicable insolvency or reorganization statute,
make
an assignment for the benefit of its creditors, or voluntarily suspend payment
of its obligations; or
(vi) the
Master Servicer assigns or delegates its duties or rights under this Agreement
in contravention of the provisions permitting such assignment or delegation
under Sections 8.05 or 8.07;
(vii) The
Master Servicer fails to deposit or cause to be deposited in the Distribution
Account any Advance (other than a Nonrecoverable Advance) by 5:00 p.m. New
York
City time on the first Business Day preceding the Distribution Date;
or
(viii) failure
by the Master Servicer to duly perform, within the required time period, its
obligations under Sections 3.16, 3.17 or 3.18 which failure continues unremedied
at the end of the cure period set forth under such Sections.
If
an
Event of Default shall occur, then, and in each and every such case, so long
as
such Event of Default shall not have been remedied, the Trustee may, and at
the
written direction of the Holders of Certificates evidencing not less than 25%
of
the Voting Rights evidenced by the Certificates or at the written direction
of
the Trustee shall in the case of any Event of Default described in clauses
(i)
through (vi) and clause (viii) above, by notice in writing to the Master
Servicer and the Swap Provider, with a copy to each
Rating
Agency may,
terminate all of the rights and obligations (but not the liabilities) of the
Master Servicer (and the Securities Administrator if the Master Servicer and
the
Securities Administrator are the same entity) under this Agreement and in and
to
the Mortgage Loans and the proceeds thereof, other than its rights as a
Certificateholder hereunder. On or after the receipt by the Master Servicer
of
such written notice, all authority and power of the Master Servicer (and, if
applicable, the Securities Administrator) hereunder, whether with respect to
the
Mortgage Loans or otherwise, shall pass to and be vested in the Trustee, or
any
Successor Master Servicer appointed pursuant to Section 9.02 (a “Successor
Master Servicer” and, if applicable, “Successor Securities Administrator”). Such
Successor Master Servicer shall thereupon if such Successor Master Servicer
is a
successor to the Master Servicer, make any Advance required by Article IV,
subject, in the case of the Trustee, to Section 9.02. The Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the terminated
Master Servicer and, if applicable, the terminated Securities Administrator,
as
attorney- in-fact or otherwise, any and all documents and other instruments,
and
to 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 any Mortgage Loans and related documents, or
otherwise. Unless expressly provided in such written notice, no such termination
shall affect any obligation of the Master Servicer to pay amounts owed pursuant
to Article VIII or Article X. The Master Servicer and, if applicable, the
Securities Administrator agrees to cooperate with the Trustee in effecting
the
termination of the Master Servicer’s and, if applicable, the Securities
Administrator’s responsibilities and rights hereunder, including, without
limitation, the transfer to the applicable Successor Master Servicer of all
cash
amounts which shall at the time be credited to the Master Servicer Collection
Account maintained pursuant to Section 5.05, or thereafter be received with
respect to the applicable Mortgage Loans. The Trustee shall promptly notify
each
Rating
Agency
of the
occurrence of an Event of Default actually
known to a Responsible Officer of the Trustee.
Notwithstanding
any termination of the activities of the Master Servicer hereunder, the Master
Servicer shall be entitled to receive, out of any late collection of a Scheduled
Payment on a Mortgage Loan that was due prior to the notice terminating the
Master Servicer’s rights and obligations as Master Servicer hereunder and
received after such notice, that portion thereof to which the Master Servicer
would have been entitled pursuant to Section 5.02 and to receive any other
amounts payable to the Master Servicer hereunder the entitlement to which arose
prior to the termination of its activities hereunder.
Notwithstanding
the foregoing, if an Event of Default described in clause (vii) of this Section
9.01 shall occur, the Trustee shall, by notice in writing to the Master
Servicer, which may be delivered by telecopy, immediately terminate all of
the
rights and obligations of the Master Servicer thereafter arising under this
Agreement, but without prejudice to any rights it may have as a Holder of the
Certificates or to reimbursement of Monthly Advances and other advances of
its
own funds, and the Trustee shall act as provided in Section 9.02 to carry out
the duties of the Master Servicer, including the obligation to make any Monthly
Advance the nonpayment of which was an Event of Default described in clause
(vii) of this Section 9.01. Any such action taken by the Trustee must be prior
to the distribution on the relevant Distribution Date.
Section
9.02 Trustee
to Act; Appointment of Successor.
On
and
after the time the Master Servicer receives a notice of termination pursuant
to
Section 9.01 hereof the Trustee shall automatically become the successor to
the
Master Servicer with respect to the transactions set forth or provided for
herein and after a transition period (not to exceed 90 days), shall be subject
to all the responsibilities, duties and liabilities relating thereto placed
on
the Master Servicer by the terms and provisions hereof; provided, however,
that
the
Company shall have the right to either (a) immediately assume the duties of
the
Master Servicer or (b) select a Successor Master Servicer;
provided, further, however that, pursuant to Article V hereof, the Trustee
in
its capacity as Successor Master Servicer shall be responsible for making any
Advances required to be made by the Master Servicer immediately upon the
termination of the Master Servicer and any such Advance shall be made on the
Distribution Date on which such Advance was required to be made by the
predecessor Master Servicer. Effective on the date of such notice of
termination, as compensation therefor, the Trustee shall be entitled to all
compensation, reimbursement of expenses and indemnification that the Master
Servicer would have been entitled to if it had continued to act hereunder,
provided, however, that the Trustee shall not be (i) liable for any acts or
omissions of the Master Servicer, (ii) obligated to make Advances if it is
prohibited from doing so under applicable law, (iii) responsible for expenses
of
the Master Servicer pursuant to Section 2.03 or (iv) obligated to deposit losses
on any Permitted Investment directed by the Master Servicer. Notwithstanding
the
foregoing, the Trustee may, if it shall be unwilling to so act, or shall, if
it
is prohibited by applicable law from making Advances pursuant to Article VI
or
if it is otherwise unable to so act, appoint, or petition a court of competent
jurisdiction to appoint, any established mortgage loan servicing institution
the
appointment of which does not adversely affect the then current rating of the
Certificates by each
Rating
Agency
as the
successor to the Master Servicer hereunder in the assumption of all or any
part
of the responsibilities, duties or liabilities of the Master Servicer hereunder.
Any Successor Master Servicer shall (i) be an institution that is a Xxxxxx
Mae
and Xxxxxxx Mac approved seller/servicer in good standing, that has a net worth
of at least $15,000,000, and (ii) be willing to act as successor servicer of
any
Mortgage Loans under this Agreement or the related Servicing Agreement with
respect to which the Company or the original Servicer has been terminated as
servicer, and shall have executed and delivered to the Depositor and the Trustee
an agreement accepting such delegation and assignment, that contains an
assumption by such Person of the rights, powers, duties, responsibilities,
obligations and liabilities of the Master Servicer (other than any liabilities
of the Master Servicer hereof incurred prior to termination of the Master
Servicer under Section 9.01 or as otherwise set forth herein), with like effect
as if originally named as a party to this Agreement, provided that each Rating
Agency shall have acknowledged in writing that its rating of the Certificates
in
effect immediately prior to such assignment and delegation will not be qualified
or reduced as a result of such assignment and delegation. If the Trustee assumes
the duties and responsibilities of the Master Servicer in accordance with this
Section 9.02, the Trustee shall not resign as Master Servicer until a Successor
Master Servicer has been appointed and has accepted such appointment. Pending
appointment of a successor to the Master Servicer hereunder, the Trustee, unless
the Trustee is prohibited by law from so acting, shall act in such capacity
as
hereinabove provided. In connection with such appointment and assumption, the
Trustee may make such arrangements for the compensation of such successor out
of
payments on Mortgage Loans or otherwise as it and such successor shall agree;
provided that no such compensation unless agreed to by the Certificateholders
shall be in excess of that permitted the Master Servicer hereunder. The Trustee
and such successor shall take such action, consistent with this Agreement,
as
shall be necessary to effectuate any such succession. Neither the Trustee nor
any other Successor Master Servicer shall be deemed to be in default hereunder
by reason of any failure to make, or any delay in making, any distribution
hereunder or any portion thereof or any failure to perform, or any delay in
performing, any duties or responsibilities hereunder, in either case caused
by
the failure of the Master Servicer and the Securities Administrator to deliver
or provide, or any delay in delivering or providing, any monies, information,
documents or records to it.
The
costs
and expenses of the Trustee in connection with the termination of the Master
Servicer, appointment of a Successor Master Servicer and, if applicable, any
transfer of master servicing, including, without limitation, all costs and
expenses associated with the complete transfer of all master servicing data
and
the completion, correction or manipulation of such master servicing data as
may
be required by the Trustee to correct any errors or insufficiencies in the
master servicing data or otherwise to enable the Trustee or the Successor Master
Servicer to master service the Mortgage Loans properly and effectively, to
the
extent not previously paid by the terminated Master Servicer, shall be payable
to the Trustee pursuant to Section 10.05.
Section
9.03 Notification
to Certificateholders.
(a) Upon
any
termination of or appointment of a successor to the Master Servicer, the Trustee
shall give prompt written notice thereof to Certificateholders, the Swap
Provider and to each Rating Agency.
(b) Within
60
days after the occurrence of any Event of Default, the Trustee shall transmit
by
mail to all Certificateholders and the Swap Provider notice of each such Event
of Default hereunder actually known to a Responsible Officer of the Trustee,
unless such Event of Default shall have been cured or waived.
Section
9.04 Waiver
of
Defaults.
The
Trustee shall transmit by mail to all Certificateholders and the Swap Provider,
within 60 days after the occurrence of any Event of Default actually known
to a
Responsible Officer of the Trustee, unless such Event of Default shall have
been
cured, notice of each such Event of Default hereunder known to the Trustee.
The
Holders of Certificates evidencing not less than 51% of the Voting Rights
may,
on
behalf of all Certificateholders, waive any default by the Master Servicer
in
the performance of its obligations hereunder and the consequences thereof,
except a default in the making of or the causing to be made of any required
remittances to the Securities Administrator. Upon any such waiver of a past
default, such default shall be deemed to cease to exist, and any Event of
Default arising therefrom shall be deemed to have been timely 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. The Trustee shall give notice of any such waiver to
each
Rating
Agency.
Section
9.05 Company
Default.
In
case
one or more of the following events of default by the Company (each, a “Company
Default”) shall occur and be continuing, that is to say:
(i) any
failure by the Company to remit to the Master Servicer any payment required
to
be made under the terms of this Agreement on any Remittance Date;
or
(ii) failure
on the part of the Company duly to observe or perform in any material respect
any other of the covenants or agreements on the part of the Company set forth
in
this Agreement (other than Sections 3.16, 3.17 or 3.18) on the part of the
Company set forth in this Agreement, the breach of which has a material adverse
effect and which continue unremedied for a period of sixty 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 and
such
failure shall be deemed to have a material adverse effect) after the date on
which written notice of such failure, requiring the same to be remedied, shall
have been given to the Company by the Master Servicer; or
(iii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
bankruptcy, readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the Company and such decree or order shall have
remained in force undischarged or unstayed for a period of sixty days;
or
(iv) the
Company 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 Company
or
of or relating to all or substantially all of its property; or
(v) the
Company shall admit in writing its inability to pay its debts generally as
they
become due, file a petition to take advantage of any applicable insolvency
or
reorganization statute, make an assignment for the benefit of its creditors,
or
voluntarily suspend payment of its obligations; or
(vi) the
Company attempts to assign its right to servicing compensation hereunder or
the
Company attempts 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 except
as
otherwise permitted herein; or
(vii) the
Company ceases to be qualified to transact business in any jurisdiction where
it
is currently so qualified, but only to the extent such non-qualification
materially and adversely affects the Company’s ability to perform its
obligations hereunder; or
(viii) failure
by the Company to duly perform, within the required time period, its obligations
under Section 3.16, Section 3.17 or Section 3.18;
then,
and
in each and every such case, so long as a Company Default shall not have been
remedied, the Master Servicer, by notice in writing to the Company may, in
addition to whatever rights the Master Servicer and the Trustee on behalf of
the
Certificateholders may have under Section 8.03 and at law or equity to damages,
including injunctive relief and specific performance, terminate all the rights
and obligations of the Company under this Agreement and in and to the EMC
Mortgage Loans and the proceeds thereof without compensating the Company for
the
same. On or after the receipt by the Company of such written notice, all
authority and power of Company under this Agreement, whether with respect to
the
EMC Mortgage Loans or otherwise, shall pass to and be vested in the Master
Servicer after a transition period (not to exceed 90 days). Upon written request
from the Master Servicer, the Company shall prepare, execute and deliver, any
and all documents and other instruments, place in the Master Servicer’s
possession all Mortgage Files relating to the EMC Mortgage Loans, 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 EMC Mortgage Loans and related documents,
or
otherwise, at the Company’s sole expense. The Company agrees to cooperate with
the Master Servicer in effecting the termination of the Company’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 Company to its Protected Account or Escrow
Account or thereafter received with respect to the EMC Mortgage Loans or any
related REO Property.
The
costs
and expenses of the Master Servicer in connection with the termination of the
Company, appointment of a successor to the Company, and, if applicable, any
transfer of servicing, including, without limitation, all costs and expenses
associated with the complete transfer of all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the
Master Servicer or other successor to the Company to correct any errors or
insufficiencies in the servicing data or otherwise to enable the Master Servicer
or such successor to service the related Mortgage Loans properly and
effectively, to the extent not previously paid by the terminated Company, shall
be payable to the Master Servicer or such successor pursuant to Section
5.07.
Section
9.06 Waiver
of
Company Defaults.
The
Master Servicer, may waive only by written notice any default by the Company
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 Company
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 in writing.
ARTICLE
X
CONCERNING
THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
Section
10.01 Duties
of
Trustee and the Securities Administrator.
(a) The
Trustee, prior to the occurrence of an Event of Default and after the curing
or
waiver of all Events of Default which may have occurred, and the Securities
Administrator each undertake to perform such duties and only such duties as
are
specifically set forth in this Agreement as duties of the Trustee and the
Securities Administrator, respectively. If an Event of Default has occurred
and
has not been cured or waived, the Trustee shall exercise such of the rights
and
powers vested in it by this Agreement, and the same degree of care and skill
in
their exercise, as a prudent person would exercise under the circumstances
in
the conduct of such Person’s own affairs.
(b) Upon
receipt of all resolutions, certificates, statements, opinions, reports,
documents, orders or other instruments which are specifically required to be
furnished to the Trustee or the Securities Administrator pursuant to any
provision of this Agreement, the Trustee or the Securities Administrator,
respectively, shall examine them to determine whether they are in the form
required by this Agreement; provided, however, that neither the Trustee or
the
Securities Administrator shall be responsible for the accuracy or content of
any
resolution, certificate, statement, opinion, report, document, order or other
instrument furnished by the Master Servicer, the Company or pursuant to any
provision of this Agreement; provided, further, that neither the Trustee nor
the
Securities Administrator shall be responsible for the accuracy or verification
of any calculation provided to it pursuant to this Agreement.
(c) On
each
Distribution Date, the Securities Administrator shall make monthly distributions
and the final distribution to the Certificateholders from funds in the
Distribution Account as provided in Sections 6.04 and 11.01 herein.
(d) No
provision of this Agreement shall be construed to relieve the Trustee or the
Securities Administrator from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct; provided, however,
that:
(i) Prior
to
the occurrence of an Event of Default, and after the curing or waiver of all
such Events of Default which may have occurred with respect to the Trustee
and
at all times with respect to the Securities Administrator, the duties and
obligations of the Trustee and the Securities Administrator shall be determined
solely by the express provisions of this Agreement, neither the Trustee nor
the
Securities Administrator shall be liable except for the performance of their
respective duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this Agreement
against the Trustee or the Securities Administrator and, in the absence of
bad
faith on the part of the Trustee or the Securities Administrator, respectively,
the Trustee or the Securities Administrator, respectively, may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the Trustee
or
the Securities Administrator, respectively, and conforming to the requirements
of this Agreement;
(ii) Neither
the Trustee nor the Securities Administrator shall be liable in its individual
capacity for an error of judgment made in good faith by a Responsible Officer
or
Responsible Officers of the Trustee or the Securities Administrator,
respectively, unless it shall be proved that the Trustee or the Securities
Administrator, respectively, was negligent in ascertaining the pertinent
facts;
(iii) Neither
the Trustee nor the Securities Administrator shall be liable with respect to
any
action taken, suffered or omitted to be taken by it in good faith in accordance
with the directions of the Holders of Certificates evidencing not less than
25%
of the aggregate Voting Rights of the Certificates (or such other percentage
as
specifically set forth herein), if such action or non-action relates to the
time, method and place of conducting any proceeding for any remedy available
to
the Trustee or the Securities Administrator, respectively, or exercising any
trust or other power conferred upon the Trustee or the Securities Administrator,
respectively, under this Agreement;
(iv) The
Trustee shall not be required to take notice or be deemed to have notice or
knowledge of any default or Event of Default unless a Responsible Officer of
the
Trustee shall have actual knowledge thereof. In the absence of such knowledge,
the Trustee may conclusively assume there is no such default or Event of
Default;
(v) Anything
in this Agreement to the contrary notwithstanding, in no event shall the Trustee
or the Securities Administrator be liable for special, indirect or consequential
loss or damage of any kind whatsoever (including but not limited to lost
profits), even if the Trustee or the Securities Administrator, respectively, has
been advised of the likelihood of such loss or damage and regardless of the
form
of action; and
(vi) None
of
the Securities Administrator, the Master Servicer, the Company, the Seller,
the
Depositor, the Trustee or the Custodians shall be responsible for the acts
or
omissions of the other, it being understood that this Agreement shall not be
construed to render them partners, joint venturers or agents of one
another.
Neither
the Trustee nor the Securities
Administrator
shall be
required to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder, or in the exercise of any
of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or adequate indemnity against such risk or liability
is
not reasonably assured to it, and none of the provisions contained in this
Agreement shall in any event require the Trustee or the Securities
Administrator
to
perform, or be responsible for the manner of performance of, any of the
obligations of the Master Servicer or the Company hereunder or the related
Servicer under the related Servicing Agreement. The Trustee is here by
authorized and directed to enter into the Assignment Agreements.
(e) All
funds
received by the Securities Administrator and required to be deposited in the
Distribution Account pursuant to this Agreement will be promptly so deposited
by
the Securities Administrator.
Section
10.02 Certain
Matters Affecting the Trustee and the Securities Administrator.
(a) Except
as
otherwise provided in Section 10.01:
(i) The
Trustee and the Securities Administrator may rely and shall be protected in
acting or refraining from acting in reliance on any resolution or certificate
of
the Depositor, the Seller, the Company or the Master Servicer or the related
Servicer, any certificates of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal, bond
or
other paper or document believed by it to be genuine and to have been signed
or
presented by the proper party or parties;
(ii) The
Trustee and the Securities Administrator may consult with counsel and any advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection with respect to any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such advice or
Opinion of Counsel;
(iii) Neither
the Trustee nor the Securities Administrator shall be under any obligation
to
exercise any of the trusts or powers vested in it by this Agreement, other
than
its obligation to give notices pursuant to this Agreement, or to institute,
conduct or defend any litigation hereunder or in relation hereto at the request,
order or direction of any of the Certificateholders pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered to the
Trustee or the Securities Administrator, as applicable, security or indemnity
reasonable to it against the costs, expenses and liabilities which may be
incurred therein or thereby. Nothing contained herein shall, however, relieve
the Trustee of the obligation, upon the occurrence of an Event of Default of
which a Responsible Officer of the Trustee has actual knowledge (which has
not
been cured or waived), to exercise such of the rights and powers vested in
it by
this Agreement, and to use the same degree of care and skill in their exercise,
as a prudent person would exercise under the circumstances in the conduct of
his
own affairs;
(iv) Neither
the Trustee nor the Securities Administrator shall be liable in its individual
capacity for any action taken, suffered or omitted by it in good faith and
believed by it to be authorized or within the discretion or rights or powers
conferred upon it by this Agreement;
(v) Neither
the Trustee nor the Securities Administrator shall be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond or other paper or document, unless requested in writing to do
so
by Holders of Certificates evidencing not less than 25% of the aggregate Voting
Rights of the Certificates and provided that the payment within a reasonable
time to the Trustee or the Securities Administrator, as applicable, of the
costs, expenses or liabilities likely to be incurred by it in the making of
such
investigation is, in the opinion of the Trustee or the Securities Administrator,
as applicable, reasonably assured to the Trustee or the Securities
Administrator, as applicable, by the security afforded to it by the terms of
this Agreement. The Trustee or the Securities Administrator may require
reasonable indemnity against such expense or liability as a condition to taking
any such action. The reasonable expense of every such examination shall be
paid
by the Certificateholders requesting the investigation;
(vi) The
Trustee and the Securities Administrator may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or through Affiliates,
agents or attorneys; provided, however, that the Trustee may not appoint any
paying agent other than the Securities Administrator to perform any paying
agent
functions under this Agreement without the express written consent of the Master
Servicer, which consents will not be unreasonably withheld. Neither the Trustee
nor the Securities Administrator shall be liable or responsible for the
misconduct or negligence of any of the Trustee’s or the Securities
Administrator’s agents or attorneys or paying agent appointed hereunder by the
Trustee or the Securities Administrator with due care and, when required, with
the consent of the Master Servicer;
(vii) Should
the Trustee or the Securities Administrator deem the nature of any action
required on its part to be unclear or ambiguous, the Trustee or the Securities
Administrator, respectively, may require prior to such action that it be
provided by the Depositor with reasonable further instructions; the right of
the
Trustee or the Securities Administrator to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and neither
the
Trustee nor the Securities Administrator shall not be accountable for other
than
its negligence or willful misconduct in the performance of any such
act;
(viii) Neither
the Trustee nor the Securities Administrator shall be required to give any
bond
or surety with respect to the execution of the trust created hereby or the
powers granted hereunder, except as provided in Section 10.07; and
(ix) Neither
the Trustee nor the Securities Administrator shall have any duty to conduct
any
affirmative investigation as to the occurrence of any condition requiring the
repurchase of any Mortgage Loan by any Person pursuant to this Agreement, or
the
eligibility of any Mortgage Loan for purposes of this Agreement.
(b) The
Securities Administrator is hereby directed by the Depositor to execute and
deliver the Swap Administration Agreement (and any amendments or supplements
to
the Swap Administration Agreement as may be requested by the Majority Class
C
Certificateholder, regarding the distributions to be made to it or its designees
thereunder). Amounts payable by the Securities Administrator on any Distribution
Date to the Swap Administrator shall be paid by the Securities Administrator
as
provided herein. The Securities Administrator in its individual capacity shall
have no responsibility for any of the undertakings, agreements or
representations with respect to the Swap Agreement or the Swap Administration
Agreement, including, without limitation, for making any payments
thereunder.
It
is
acknowledged and agreed that the Person serving as Securities Administrator
hereunder shall also serve as Swap Administrator under the Swap Administration
Agreement and act as Supplemental Interest Trust Trustee under the Swap
Agreement. The Securities Administrator, the Swap Administrator and the
Supplemental Interest Trust Trustee are hereby directed by the Depositor to
execute and deliver the Swap Administration Agreement (and any amendments or
supplements to the Swap Administration Agreement as may be requested by the
Majority Class C Certificateholder, regarding the distributions to be made
to it
or its designees thereunder) and the Supplemental Interest Trust Trustee is
hereby directed to execute and deliver the Swap Agreement and to make the
representations required therein. The Swap Administrator shall not have any
liability for any failure or delay in payments to the Trust which are required
under the Swap Administration Agreement where such failure or delay is due
to
the failure or delay of the Swap Provider in making such payment to the Swap
Administrator. LaSalle in its individual capacity and as Swap Administrator,
the
Securities Administrator and the Supplemental Interest Trust Trustee shall
be
entitled to be indemnified and held harmless by the Trust from and against
any
and all losses, claims, expenses or other liabilities that arise by reason
of or
in connection with the performance or observance by each of the Swap
Administrator, the Securities Administrator and the Supplemental Interest Trust
Trustee of its duties or obligations under the Swap Agreement or the Swap
Administration Agreement, except to the extent that the same is due to the
Swap
Administrator’s, the Securities Administrator’s or the Supplemental Interest
Trust Trustee’s gross negligence, willful misconduct or fraud. Any Person
appointed as successor trustee pursuant to Section 9.02 shall also be required
to serve as successor Swap Administrator and successor supplemental interest
trust trustee under the Swap Agreement and the Swap Administration
Agreement.
Section
10.03 Trustee
and Securities Administrator Not Liable for Certificates or Mortgage
Loans.
The
recitals contained herein and in the Certificates (other than the signature
and
countersignature of the Securities
Administrator
on the
Certificates) shall be taken as the statements of the Depositor, and neither
the
Trustee nor the Securities Administrator shall have any responsibility for
their
correctness. Neither the Trustee nor the Securities Administrator makes any
representation as to the validity or sufficiency of, the Certificates (other
than the signature and countersignature of the Securities Administrator on
the
Certificates), any Custodial Agreement or of any Mortgage Loan. The Securities
Administrator’s signature and countersignature (or countersignature of its
agent) on the Certificates shall be solely in its capacity as Securities
Administrator and shall not constitute the Certificates an obligation of the
Securities Administrator in any other capacity. Neither the Trustee nor the
Securities Administrator shall be accountable for the use or application by
the
Depositor of any of the Certificates or of the proceeds of such Certificates,
or
for the use or application of any funds paid to the Depositor with respect
to
the Mortgage Loans. Subject to Section 2.06, neither the Trustee nor the
Securities Administrator shall be responsible for the legality or validity
of
this Agreement, any Custodial Agreement or any document or instrument relating
to this Agreement, the validity of the execution of this Agreement or of any
supplement hereto or instrument of further assurance, or the validity, priority,
perfection or sufficiency of the security for the Certificates issued hereunder
or intended to be issued hereunder. Neither the Trustee nor the Securities
Administrator shall at any time have any responsibility or liability for or
with
respect to the legality, validity and enforceability of any Mortgage or any
Mortgage Loan, or the perfection and priority of any Mortgage or the maintenance
of any such perfection and priority, or for or with respect to the sufficiency
of the Trust Fund or its ability to generate the payments to be distributed
to
Certificateholders, under this Agreement. The Trustee shall not be responsible
for filing any financing or continuation statement in any public office at
any
time or to otherwise perfect or maintain the perfection of any security interest
or lien granted to the Trustee hereunder or to record this
Agreement.
Section
10.04 Trustee
and Securities Administrator May Own Certificates.
Each
of
the Trustee and the Securities Administrator in its individual capacity or
in
any capacity other than as Trustee or the Securities Administrator hereunder
may
become the owner or pledgee of any Certificates with the same rights it would
have if it were not the Trustee or the Securities Administrator, as applicable,
and may otherwise deal with the parties hereto.
Section
10.05 Trustee’s
and Securities Administrator’s Fees and Expenses.
The
fees
and expenses of the Trustee and the Securities Administrator shall be paid
in
accordance with a side letter agreement with the Master Servicer and at the
expense of the Master Servicer. In addition, the Securities Administrator shall
be entitled to any investment income on amounts on deposit in the Master
Servicer Collection Account and the Distribution Account. In addition, the
Trustee and the Securities Administrator will be entitled to recover from the
Master Servicer Collection Account pursuant to Section 5.07 all reasonable
out-of-pocket expenses, disbursements and advances and the expenses of the
Trustee and the Securities Administrator, respectively, incurred in the course
of its respective engagement hereunder, including without limitation in
connection with any Event of Default, any breach of this Agreement or any claim
or legal action (including any pending or threatened claim or legal action)
incurred or made by the Trustee or the Securities Administrator, respectively,
in the administration of the trusts hereunder (including the reasonable
compensation, expenses and disbursements of its counsel) except any such
expense, disbursement or advance as may arise from its negligence or intentional
misconduct or which is the responsibility of the Certificateholders hereunder.
If funds in the Master Servicer Collection Account are insufficient therefor,
the Trustee and the Securities Administrator shall recover such expenses,
disbursements or advances from EMC and EMC hereby agrees to pay such expenses,
disbursements or advances upon demand. Such compensation and reimbursement
obligation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust.
Section
10.06 Eligibility
Requirements for Trustee and Securities Administrator.
The
Trustee and any successor Trustee and the Securities Administrator and any
successor Securities Administrator shall during the entire duration of this
Agreement be a state bank or trust company or a national banking association
organized and doing business under the laws of a state or the United States
of
America, authorized under such laws to exercise corporate trust powers, having
a
combined capital and surplus and undivided profits of at least $50,000,000,
subject to supervision or examination by federal or state authority and rated
“Baa2” or higher by Moody’s
with
respect to any outstanding long-term unsecured unsubordinated debt, and, in
the
case of a successor Trustee or successor Securities Administrator other than
pursuant to Section 10.10, rated in one of the two highest long-term debt
categories by each
Rating
Agency
or
otherwise acceptable to each
Rating Agency.
The
Trustee shall not be an Affiliate of the Master Servicer. If the Trustee
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for
the
purposes of this Section 10.06 the combined capital and surplus of such
corporation shall be deemed to be its total equity capital (combined capital
and
surplus) as set forth in its most recent report of condition so published.
In
case at any time the Trustee or the Securities Administrator, as applicable,
shall cease to be eligible in accordance with the provisions of this Section
10.06, the Trustee or the Securities Administrator shall resign immediately
in
the manner and with the effect specified in Section 10.08.
Section
10.07 Insurance.
The
Trustee
and the
Securities Administrator, at their own expense,
shall
at all times (A) maintain and keep in full force and effect: (i) fidelity
insurance, (ii) theft of documents insurance and (iii) forgery insurance (which
may be collectively satisfied by a “Financial Institution Bond” and/or a
“Bankers’ Blanket Bond”) or (B) in the case of the Securities Administrator,
self insure if LaSalle Bank National Association maintains with any Rating
Agency the equivalent of a long term unsecured debt rating of “A”. All such
insurance shall be in amounts, with standard coverage and subject to
deductibles, as are customary for insurance typically maintained by banks or
their affiliates which act as custodians for investor-owned mortgage pools.
A
certificate of an officer of the Trustee or
the
Securities Administrator
as to
the Trustee’s or
the
Securities Administrator’s, respectively,
compliance with this Section 10.07 shall be furnished to any Certificateholder
upon reasonable written request.
Section
10.08 Resignation
and Removal of Trustee and Securities Administrator.
The
Trustee and the Securities Administrator may at any time resign (including,
in
the case of the Securities Administrator being affiliated with the Master
Servicer, in connection with the resignation or termination of the Master
Servicer) and be discharged from the Trust hereby created by giving written
notice thereof to the Depositor, the Swap Provider, the Seller, the Securities
Administrator (or the Trustee, if the Securities Administrator resigns) and
the
Master Servicer, with a copy to each
Rating
Agency.
Upon
receiving such notice of resignation, the Depositor shall promptly appoint
a
successor trustee or successor securities administrator, as applicable, (and
in
the case of the Securities Administrator’s removal, the Trustee may appoint a
successor securities administrator) by written instrument, in triplicate, one
copy of which instrument shall be delivered to each of the resigning trustee
or
securities administrator, as applicable, and the successor trustee or securities
administrator, as applicable. If no successor trustee or successor securities
administrator shall have been so appointed and have accepted appointment within
30 days after the giving of such notice of resignation, the resigning Trustee
or
Securities Administrator may petition any court of competent jurisdiction for
the appointment of a successor trustee or securities administrator.
If
at any
time (i) the Trustee or the Securities Administrator shall cease to be eligible
in accordance with the provisions of Section 10.06 hereof and shall fail to
resign after written request thereto by the Depositor, (ii) the Trustee or
the
Securities Administrator shall become incapable of acting, or shall be adjudged
as bankrupt or insolvent, or a receiver of the Trustee or the Securities
Administrator or of its property shall be appointed, or any public officer
shall
take charge or control of the Trustee or the Securities Administrator or of
its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, or (iii)(A) a tax is imposed with respect to the Trust Fund by
any
state in which the Trustee or the Securities Administrator or the Trust Fund
is
located, (B) the imposition of such tax would be avoided by the appointment
of a
different trustee or securities administrator and (C) the Trustee or the
Securities Administrator, as applicable, fails to indemnify the Trust Fund
against such tax, then the Depositor or the Master Servicer may remove the
Trustee or the Securities Administrator , as applicable, (and in the case of
the
Securities Administrator’s ineligibility, the Trustee may appoint a successor
securities administrator) and appoint a successor trustee or successor
securities administrator, as applicable, by written instrument, in multiple
copies, a copy of which instrument shall be delivered to the Trustee, the
Securities Administrator, the Master Servicer and the successor trustee or
successor securities administrator, as applicable.
The
Holders evidencing at least 51% of the Voting Rights of each Class of
Certificates may at any time remove the Trustee or Securities Administrator
and
appoint a successor trustee or securities administrator by written instrument
or
instruments, in multiple copies, signed by such Holders or their
attorneys-in-fact duly authorized, one complete set of which instruments shall
be delivered by the successor trustee or successor securities administrator
to
each of the Master Servicer, the Trustee or Securities Administrator so removed
and the successor trustee or securities administrator so appointed. Notice
of
any removal of the Trustee or Securities Administrator shall be given to each
Rating Agency by the related successor.
Any
resignation or removal of the Trustee or the Securities Administrator and
appointment of a successor trustee or securities administrator pursuant to
any
of the provisions of this Section 10.08 shall become effective upon acceptance
of appointment by the successor trustee or securities administrator as provided
in Section 10.09 hereof.
Section
10.09 Successor
Trustee or Securities Administrator.
Any
successor trustee or securities administrator appointed as provided in Section
10.08 hereof shall execute, acknowledge and deliver to the Depositor, to its
predecessor trustee or predecessor securities administrator, as applicable,
and
the Master Servicer an instrument accepting such appointment hereunder and
thereupon the resignation or removal of the predecessor trustee or securities
administrator shall become effective and such successor trustee or securities
administrator without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
hereunder, with the like effect as if originally named as trustee or securities
administrator herein.
No
successor trustee or securities administrator shall accept appointment as
provided in this Section 10.09 unless at the time of such acceptance such
successor trustee or securities administrator shall be eligible under the
provisions of Section 10.07 hereof and its appointment shall not adversely
affect the then current rating of the Certificates.
Upon
acceptance of appointment by a successor trustee or securities administrator
as
provided in this Section 10.09, the successor trustee or securities
administrator shall mail notice of the succession of such trustee or securities
administrator hereunder to all Holders of Certificates. If the successor trustee
or securities administrator fails to mail such notice within ten days after
acceptance of appointment, the Depositor shall cause such notice to be mailed
at
the expense of the Trust Fund.
Section
10.10 Merger
or
Consolidation of Trustee or Securities Administrator.
Any
corporation, state bank or national banking association into which the Trustee
or the Securities Administrator may be merged or converted or with which it
may
be consolidated or any corporation, state bank or national banking association
resulting from any merger, conversion or consolidation to which the Trustee
or
the Securities Administrator shall be a party, or any corporation, state bank
or
national banking association succeeding to substantially all of the corporate
trust business of the Trustee or of the business of the Securities
Administrator, shall be the successor of the Trustee or the Securities
Administrator hereunder, provided that such corporation shall be eligible under
the provisions of Section 10.06 hereof without the execution or filing of any
paper or further act on the part of any of the parties hereto, anything herein
to the contrary notwithstanding.
Section
10.11 Appointment
of Co-Trustee or Separate Trustee.
Notwithstanding
any other provisions of this Agreement, at any time, for the purpose of meeting
any legal requirements of any jurisdiction in which any part of the Trust Fund
or property securing any Mortgage Note may at the time be located, the Master
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund,
and
to vest in such Person or Persons, in such capacity and for the benefit of
the
Certificateholders, such title to the Trust Fund or any part thereof, whichever
is applicable, and, subject to the other provisions of this Section 10.11,
such
powers, duties, obligations, rights and trusts as the Master Servicer and the
Trustee may consider necessary or desirable. If the Master Servicer shall not
have joined in such appointment within 15 days after the receipt by it of a
request to do so, or in the case an Event of Default shall have occurred and
be
continuing, the Trustee alone shall have the power to make such appointment.
No
co-trustee or separate trustee hereunder shall be required to meet the terms
of
eligibility as a successor trustee under Section 10.06 and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 10.09.
Every
separate trustee and co-trustee shall, to the extent permitted by law, be
appointed and act subject to the following provisions and
conditions:
(i) All
rights, powers, duties and obligations conferred or imposed upon the Trustee,
except for the obligation of the Trustee under this Agreement to advance funds
on behalf of the Master Servicer, shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Trustee joining in such act), except
to
the extent that under any law of any jurisdiction in which any particular act
or
acts are to be performed (whether a Trustee hereunder or as a Successor Master
Servicer hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust Fund or any portion thereof in
any
such jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(ii) No
trustee hereunder shall be held personally liable by reason of any act or
omission of any other trustee hereunder; and
(iii) The
Trustee may at any time accept the resignation of or remove any separate trustee
or co-trustee.
Any
notice, request or other writing given to the Trustee shall be deemed to have
been given to each of the then separate trustees and co-trustees, as effectively
as if given to each of them. Every instrument appointing any separate trustee
or
co-trustee shall refer to this Agreement and the conditions of this Article
X.
Each separate trustee and co-trustee, upon its acceptance of the trusts
conferred, shall be vested with the estates or property specified in its
instrument of appointment, either jointly with the Trustee or separately, as
may
be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to
the
Master Servicer and the Depositor.
Any
separate trustee or co-trustee may, at any time, constitute the Trustee its
agent or attorney-in-fact, with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement
on
its behalf and in its name. If any separate trustee or co- trustee shall die,
become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
Section
10.12 Tax
Matters.
It
is
intended that the Trust Fund shall constitute, and that the affairs of the
Trust
Fund shall be conducted so that each REMIC formed hereunder qualifies as, a
“real estate mortgage investment conduit” as defined in and in accordance with
the REMIC Provisions. In furtherance of such intention, the Securities
Administrator covenants and agrees that it shall act as agent (and the
Securities Administrator is hereby appointed to act as agent) on behalf of
the
Trust Fund. The Securities Administrator, as agent on behalf of the Trust Fund,
shall do or refrain from doing, as applicable, the following: (a) the Securities
Administrator shall prepare and file, or cause to be prepared and filed, in
a
timely manner, U.S. Real Estate Mortgage Investment Conduit Income Tax Returns
(Form 1066 or any successor form adopted by the Internal Revenue Service) and
prepare and file or cause to be prepared and filed with the Internal Revenue
Service and applicable state or local tax authorities income tax or information
returns for each taxable year with respect to each such REMIC containing such
information and at the times and in the manner as may be required by the Code
or
state or local tax laws, regulations, or rules, and furnish, or cause to be
furnished, to Certificateholders the schedules, statements or information at
such times and in such manner as may be required thereby; (b) the Securities
Administrator shall apply for an employer identification number with the
Internal Revenue Service via a Form SS-4 or other comparable method for each
REMIC that is or becomes a taxable entity, and within thirty days of the Closing
Date, furnish or cause to be furnished to the Internal Revenue Service, on
Forms
8811 or as otherwise may be required by the Code, the name, title, address,
and
telephone number of the Person that the Holders of the Certificates may contact
for tax information relating thereto, together with such additional information
as may be required by such Form, and update such information at the time or
times in the manner required by the Code for the Trust Fund; (c) the Securities
Administrator on behalf of the Trustee shall make, or cause to be made
elections, on behalf of each REMIC formed hereunder to be treated as a REMIC
on
the federal tax return of such REMIC for its first taxable year (and, if
necessary, under applicable state law); (d) the Securities Administrator shall
prepare and forward, or cause to be prepared and forwarded, to the
Certificateholders and to the Internal Revenue Service and, if necessary, state
tax authorities, all information returns and reports as and when required to
be
provided to them in accordance with the REMIC Provisions, including without
limitation, the calculation of any original issue discount using the Prepayment
Assumption; (e) the Securities Administrator shall provide information necessary
for the computation of tax imposed on the transfer of a Residual Certificate
to
a Person that is not a Permitted Transferee, or an agent (including a broker,
nominee or other middleman) of a Person that is not a Permitted Transferee,
or a
pass-through entity in which a Person that is not a Permitted Transferee is
the
record holder of an interest (the reasonable cost of computing and furnishing
such information may be charged to the Person liable for such tax); (f) each
of
the Securities Administrator and the Trustee shall, to the extent under its
control, conduct the affairs of the Trust Fund at all times that any
Certificates are outstanding so as to maintain the status of each REMIC formed
hereunder as a REMIC under the REMIC Provisions; (g) neither the
Trustee nor the Securities Administrator shall knowingly or intentionally take
any action or omit to take any action that could (i) cause the termination
of
the REMIC status of any REMIC formed hereunder or (ii) result in the imposition
of a tax upon the Trust Fund (including but not limited to the tax on prohibited
transactions as defined in Section 860F(a)(2) of the Code and the tax on
contributions to a REMIC set forth in Section 860G(d) of the Code);
(h) the
Securities Administrator shall pay, from the sources specified in this Section
10.12, the amount of any federal, state and local taxes, including prohibited
transaction taxes as described below, imposed on any REMIC formed hereunder
prior to the termination of the Trust Fund when and as the same shall be due
and
payable (but such obligation shall not prevent the Securities Administrator
or
any other appropriate Person from contesting any such tax in appropriate
proceedings and shall not prevent the Securities Administrator from withholding
payment of such tax, if permitted by law, pending the outcome of such
proceedings); (i) the Trustee shall sign or cause to be signed federal, state
or
local income tax or information returns or any other document prepared by the
Securities Administrator pursuant to this Section 10.12 requiring a signature
thereon by the Trustee; (j) the Securities Administrator shall maintain records
relating to each REMIC formed hereunder including but not limited to the income,
expenses, assets and liabilities of each such REMIC and adjusted basis of the
Trust Fund property determined at such intervals as may be required by the
Code,
as may be necessary to prepare the foregoing returns, schedules, statements
or
information; (k) the Securities Administrator shall, for federal income tax
purposes, maintain books and records with respect to the REMICs on a calendar
year and on an accrual basis; (l) none of the Trustee, the Master Servicer
or
the Securities Administrator shall enter into any arrangement not otherwise
provided for in this Agreement by which the REMICs will receive a fee or other
compensation for services nor permit the REMICs to receive any income from
assets other than “qualified mortgages” as defined in Section 860G(a)(3) of the
Code or “permitted investments” as defined in Section 860G(a)(5) of the Code;
and (l) as and when necessary and appropriate, the Securities Administrator,
at
the expense of the Trust Fund, shall represent the Trust Fund in any
administrative or judicial proceedings relating to an examination or audit
by
any governmental taxing authority, request an administrative adjustment as
to
any taxable year of any REMIC formed hereunder, enter into settlement agreements
with any governmental taxing agency, extend any statute of limitations relating
to any tax item of the Trust Fund, and otherwise act on behalf of each REMIC
formed hereunder in relation to any tax matter involving any such
REMIC.
In
order
to enable each of the Trustee and the Securities Administrator to perform its
duties as set forth herein, the Depositor shall provide, or cause to be
provided, to the Trustee or the Securities Administrator within 10 days after
the Closing Date all information or data that the Trustee or the Securities
Administrator requests in writing and determines to be relevant for tax purposes
to the valuations and offering prices of the Certificates, including, without
limitation, the price, yield, prepayment assumption and projected cash flows
of
the Certificates and the Mortgage Loans. Thereafter, the Depositor shall provide
to the Trustee or the Securities Administrator promptly upon written request
therefor, any such additional information or data that the Trustee or the
Securities Administrator may, from time to time, request in order to enable
the
Trustee or the Securities Administrator to perform its duties as set forth
herein. The Depositor hereby indemnifies each of the Trustee and the Securities
Administrator for any losses, liabilities, damages, claims or expenses of the
Trustee or the Securities Administrator arising from any errors or
miscalculations of the Trustee or the Securities Administrator that result
from
any failure of the Depositor to provide, or to cause to be provided, accurate
information or data to the Trustee or the Securities Administrator, as
applicable, on a timely basis.
In
the
event that any tax is imposed on “prohibited transactions” of any of REMIC I,
REMIC II, REMIC III, REMIC IV or REMIC V as defined in Section 860F(a)(2) of
the
Code, on the “net income from foreclosure property” of the Trust Fund as defined
in Section 860G(c) of the Code, on any contribution to any of REMIC I, REMIC
II,
REMIC III, REMIC IV or REMIC V after the Startup Day pursuant to Section 860G(d)
of the Code, or any other tax is imposed, including, without limitation, any
federal, state or local tax or minimum tax imposed upon any of REMIC I, REMIC
II, REMIC III, REMIC IV or REMIC V, and is not paid as otherwise provided for
herein, such tax shall be paid (i) by the Master Servicer or the Securities
Administrator, if any such tax arises out of or results from a breach by the
Master Servicer or the Securities Administrator of any of its obligations under
this Agreement, provided, however, in no event shall the Master Servicer or
the
Securities Administrator have any liability (1) for any action or omission
that
is taken in accordance with and compliance with the express terms of, or which
is expressly permitted by the terms of, this Agreement, (2) for any losses
other
than arising out of a negligent performance by the Master Servicer or the
Securities Administrator of its duties and obligations set forth herein, or
(3)
for any special or consequential damages to Certificateholders (in addition
to
payment of principal and interest on the Certificates), (ii) by any party hereto
(other than the Master Servicer or the Securities Administrator) to the extent
any such tax arises out of or results from a breach by such other party of
any
of its obligations under this Agreement or (iii) in all other cases, or in
the
event that any liable party hereto fails to honor its obligations under the
preceding clauses (i) or (ii), first, with amounts otherwise to be distributed
to the Class R Certificateholders (pro rata), and second, with amounts otherwise
to be distributed to the Holders of the following other Certificates in the
following order of priority: first, to the Class B-4 Certificates, second,
to
the Class B-3 Certificates, third, to the Class B-2 Certificates, fourth, to
the
Class B-1 Certificates, fifth, to the Class M-6 Certificates, sixth, to the
Class M-5 Certificates, seventh, to the Class M-4 Certificates, eighth, to
the
Class M-3 Certificates, ninth, to the Class M-2 Certificates, tenth, to the
Class M-1 Certificates, and eleventh, to the Class A Certificates.
Notwithstanding anything to the contrary contained herein, to the extent that
any taxes described in the preceding sentence are payable by the Holder of
any
such Certificates, the Securities Administrator is hereby authorized to retain
on any Distribution Date from the Holders of the Class R Certificates (and,
if
necessary, second, from the Holders of the other relevant Certificates in the
priority specified in the preceding sentence), funds otherwise distributable
to
such Holders in an amount sufficient to pay such taxes. The Securities
Administrator shall include in its Monthly Statement amounts allocated to the
relevant Certificates, taking into account the priorities described in the
second preceding sentence. The Securities Administrator shall promptly notify
in
writing the party liable for any such tax of the amount thereof and the due
date
for the payment thereof.
The
Trustee, the Master Servicer and the Securities Administrator each agree that,
in the event it should obtain any information necessary for the other party
to
perform its obligations pursuant to this Section 10.12, it will promptly notify
and provide such information to such other party.
Notwithstanding
the foregoing, with respect to the preparation and filing of tax returns in
the
event that the right to receive payments in respect of Basis Risk Shortfall
Carry Forward Amounts could be treated as a partnership among the Holders of
the
Class A, Class M, Class B and Class C Certificates, the Securities Administrator
shall not be required to prepare and file partnership tax returns on behalf
of
the Trust Fund or portion thereof unless it receives additional reasonable
compensation for the preparation of such filings and written notification from
either an officer or tax counsel for the Depositor recognizing the creation
of a
partnership for federal income tax purposes.
Notwithstanding
any other provision of this Agreement, the Securities Administrator shall comply
with all federal withholding requirements respecting payments to
Certificateholders of interest or original issue discount that the Securities
Administrator reasonably believes are applicable under the Code. The consent
of
Certificateholders shall not be required for such withholding. In the event
the
Securities Administrator does withhold any amount from interest or original
issue discount payments or advances thereof to any Certificateholder pursuant
to
federal withholding requirements, the Securities Administrator shall indicate
the amount withheld to such Certificateholders.
Section
10.13 REMIC-Related
Covenants.
For
as
long as each REMIC shall exist, the Trustee and the Securities Administrator
shall act in accordance herewith to assure continuing treatment of such REMIC
as
a REMIC, and the Trustee and the Securities Administrator shall comply with
any
directions of the Seller, the Company, the Servicer or the Master Servicer
to
assure such continuing treatment. In furtherance, but not in limitation, of
the
foregoing, neither the Trustee nor the Securities Administrator shall (a) sell
or permit the sale of all or any portion of the Mortgage Loans or of any
investment of deposits in an Account unless such sale is as a result of a
repurchase of the Mortgage Loans pursuant to this Agreement or the Trustee
and
the Securities Administrator has received a REMIC Opinion addressed to the
Securities Administrator and the Trustee prepared at the expense of the Trust
Fund; (b) other than with respect to a substitution pursuant to the Mortgage
Loan Purchase Agreement or Section 2.03 of this Agreement, as applicable, accept
any contribution to any REMIC after the Startup Day without receipt of a REMIC
Opinion; or (c) acquire any assets for any REMIC other than any REO Property
after the Startup Day without receipt of a REMIC Opinion.
ARTICLE
XI
TERMINATION
Section
11.01 Termination
upon Liquidation or Repurchase of all Mortgage Loans.
Subject
to Section 11.03, the obligations and responsibilities of the Depositor, the
Master Servicer, the Securities Administrator, the Seller and the Trustee
created hereby with respect to the Trust Fund shall terminate upon the earlier
of (a) the exercise by the Majority Class C Certificateholder of its right
to
purchase all of the Mortgage Loans (and REO Properties) remaining in the Trust
Fund at a price (the “Mortgage Loan Purchase Price”) equal to the sum of (i)
100% of the Stated Principal Balance of each Mortgage Loan (other than in
respect of REO Property), (ii) accrued interest thereon at the applicable
Mortgage Rate to, but not including, the first day of the month of such
purchase, (iii) the appraised value of any REO Property in the Trust Fund (up
to
the Stated Principal Balance of the related Mortgage Loan), such appraisal
to be
conducted by an appraiser mutually agreed upon by the related servicer and
the
Trustee and (iv) unreimbursed out-of pocket costs of the Company, the Servicers
or the Master Servicer, including unreimbursed Servicing Advances and the
principal portion of any unreimbursed Advances made on the Mortgage Loans prior
to the exercise of such repurchase right (v) any unreimbursed costs and expenses
of the Trustee and the Securities Administrator payable pursuant to Section
10.05 or of the Custodian pursuant to the Custodial Agreement and (vi)
any
Swap
Termination Payment (which shall include any Net Swap Payment payable by the
Trust Fund for the final Distribution Date) payable to the Swap Provider which
remains unpaid or which is due to the exercise of such option (the “Swap
Optional Termination Payment”) and
(b)
the later of (i) the maturity or other liquidation (or any Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund and the
disposition of all REO Property and (ii) the distribution to Certificateholders
of all amounts required to be distributed to them pursuant to this Agreement.
In
no
event shall the Trust Fund created hereby continue beyond the earlier of (i)
the
expiration of 21 years from the death of the last survivor of the descendants
of
Xxxxxx X. Xxxxxxx, the late Ambassador of the United States to the Court of
St.
Xxxxx, living on the date hereof and (ii) the Latest Possible Maturity
Date.
The
right
to repurchase all Mortgage Loans and REO Properties by the Majority Class C
Certificateholder pursuant to clause (a) in the preceding paragraph shall be
conditioned upon the Stated Principal Balance of all of the Mortgage Loans
in
the Trust Fund, at the time of any such repurchase, aggregating 20% or less
of
the aggregate Cut-off Date Principal Balance of all of the Mortgage Loans.
If
the Majority Class C Certificateholder elects to terminate the Trust Fund
pursuant to this Section 11.01, at least 20 days prior to the date notice is
to
be mailed to the Certificateholders, the Majority Class C Certificateholder
shall notify the Depositor, the Master Servicer, the Securities Administrator,
the Trustee and the Swap Provider of the date the Majority Class C
Certificateholder intends to terminate the Trust Fund. The Master Servicer
shall
remit the related Mortgage Loan Purchase Price to the Securities Administrator
on the Business Day prior to the Distribution Date for such Optional Termination
by the Majority Class C Certificateholder, as applicable.
Only
an
amount equal to the Mortgage Loan Purchase Price less any Swap Optional
Termination Payment shall be made available for distribution to the Regular
Certificates. Any Swap Optional Termination Payment paid as part of the Mortgage
Loan Purchase Price and deposited into the Distribution Account shall be
withdrawn by the Securities Administrator from the Distribution Account and
remitted to the Supplemental Interest Trust to be paid in accordance with
Section 4.14(c). The Swap Optional Termination Payment shall not be part of
any
REMIC and shall not be paid into any account which is part of any REMIC.
Notwithstanding
the foregoing, the provisions of Section 8.03 hereof shall survive the
termination of this Agreement.
Section
11.02 Final
Distribution on the Certificates.
(i) If
on any
Determination Date, (i) the Master Servicer determines that there are no related
Outstanding Mortgage Loans and no other funds or assets in the Trust Fund other
than the funds in the Master Servicer Collection Account, the Master Servicer
shall direct the Securities Administrator to send a final distribution notice
promptly to each related Certificateholder or (ii) the Securities Administrator
determines that a Class of Certificates shall be retired after a final
distribution on such Class, the Securities Administrator shall notify the
related Certificateholders within five (5) Business Days after such
Determination Date that the final distribution in retirement of such Class
of
Certificates is scheduled to be made on the immediately following Distribution
Date. Any final distribution made pursuant to the immediately preceding sentence
shall be made only upon presentation and surrender of the related Certificates
at the Corporate Office of the Securities Administrator.
(ii) Notice
of
any termination of the Trust Fund, specifying the Distribution Date on which
related Certificateholders may surrender their Certificates for payment of
the
final distribution and cancellation, shall be given promptly by the Securities
Administrator by letter to Certificateholders mailed not later than two Business
Days after the Determination Date in the month of such final distribution.
Any
such notice shall specify (a) the Distribution Date upon which final
distribution on the Certificates shall be made upon presentation and surrender
of Certificates at the office therein designated, (b) the amount of such final
distribution, (c) the location of the office or agency at which such
presentation and surrender must be made and (d) that the Record Date otherwise
applicable to such Distribution Date is not applicable, distributions being
made
only upon presentation and surrender of the Certificates at the office therein
specified. The Securities Administrator will give such notice to each Rating
Agency at the time such notice is given to Certificateholders.
(iii) In
the
event such notice is given, the Master Servicer shall cause all funds in the
Master Servicer Collection Account to be remitted to the Securities
Administrator for deposit in the Distribution Account on the second Business
Day
prior to the applicable Distribution Date in an amount equal to the final
distribution in respect of the Certificates. Upon such final deposit with
respect to the Trust Fund and the receipt by the Custodian of a Request for
Release therefor, the Custodian shall promptly release to the Master Servicer,
as applicable the Mortgage Files for the Mortgage Loans and the Trustee shall
execute and deliver any documents prepared and delivered to it which are
necessary to transfer any REO Property.
(iv) Upon
presentation and surrender of the Certificates, the Securities Administrator
shall cause to be distributed to Certificateholders of each Class in accordance
with the Remittance Report the amounts allocable to such Certificates held
in
the Distribution Account in the order and priority set forth in Section 6.04
hereof on the final Distribution Date and in proportion to their respective
Percentage Interests.
(v) In
the
event that any affected Certificateholders shall not surrender Certificates
for
cancellation within six months after the date specified in the above mentioned
written notice, the Securities Administrator shall give a second written notice
to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
six months after the second notice all the applicable Certificates shall not
have been surrendered for cancellation, the Securities Administrator may take
appropriate steps, or may appoint an agent to take appropriate steps, to contact
the remaining Certificateholders concerning surrender of their Certificates,
and
the cost thereof shall be paid out of the funds and other assets that remain
a
part of the Trust Fund. If within one year after the second notice all related
Certificates shall not have been surrendered for cancellation, the related
Residual Certificateholders shall be entitled to all unclaimed funds and other
assets of the Trust Fund that remain subject hereto.
Section
11.03 Additional
Termination Requirements.
(a) Upon
exercise by the Majority Class C Certificateholder of its purchase option as
provided in Section 11.01, the Trust Fund shall be terminated in accordance
with
the following additional requirements, unless each of the Trustee and the
Securities Administrator have been supplied with an Opinion of Counsel addressed
to the Trustee and the Securities Administrator, at the expense of the Majority
Class C Certificateholder, to the effect that the failure of the Trust Fund
to
comply with the requirements of this Section 11.03 will not (i) result in the
imposition of taxes on “prohibited transactions” of a REMIC, or (ii) cause a
REMIC to fail to qualify as a REMIC at any time that any Certificates are
outstanding:
(1) The
Majority Class C Certificateholder shall establish a 90-day liquidation period
for REMIC I, REMIC II, REMIC III, REMIC IV and REMIC V and notify the Trustee
and Securities Administrator thereof, and the Securities Administrator shall
in
turn specify the first day of such period in a statement attached to the tax
returns for REMIC I, REMIC II, REMIC III, REMIC IV and REMIC V pursuant to
Treasury Regulation Section 1.860F-1. The Majority Class C Certificateholder
shall satisfy all the requirements of a qualified liquidation under Section
860F
of the Code and any regulations thereunder with respect to each REMIC related
to
the terminated Trust Fund, as evidenced by an Opinion of Counsel addressed
to
the Securities Administrator and the Trustee obtained at the expense of the
Majority Class C Certificateholder;
(2) During
such 90-day liquidation period, and at or prior to the time of making the final
payment on the Certificates, the Securities Administrator on behalf of the
Trustee shall sell all of the assets of REMIC I for cash; and
(3) At
the
time of the making of the final payment on the Certificates, the Securities
Administrator shall distribute or credit, or cause to be distributed or
credited, to the Holders of the Residual Certificates all cash on hand (other
than cash retained to meet claims), and REMIC I shall terminate at that
time.
(b) By
their
acceptance of the Certificates, the Holders thereof hereby authorize the
adoption of a 90-day liquidation period and plan of complete liquidation for
the
each related REMIC, which authorization shall be binding upon all successor
Certificateholders.
(c) The
Securities Administrator, as agent for each REMIC, hereby agrees to adopt and
sign such a plan of complete liquidation meeting the requirements for a
qualified liquidation under Section 860F of the Code and any regulations
thereunder upon the written request of the Majority Class C Certificateholder
and the receipt of the Opinion of Counsel referred to in Section 11.03(a)(1),
and to take such other action in connection therewith as may be reasonably
requested by the Majority Class C Certificateholder.
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
Section
12.01 Amendment.
This
Agreement may be amended from time to time by parties hereto without the consent
of any of the Certificateholders to cure any ambiguity, to correct or supplement
any provisions herein (including to give effect to the expectations of
investors), to
comply
with any changes in the Code, to revise any provisions to reflect the
obligations of the parties to this Agreement as they relate to Regulation
AB,
to
change the manner in which the Master Servicer Collection Account maintained
by
the Master Servicer or the Protected Account maintained by the Company is
maintained or to make such other provisions with respect to matters or questions
arising under this Agreement as shall not be inconsistent with any other
provisions herein if such action shall not, as evidenced by an Opinion of
Counsel addressed to the Trustee (which opinion shall be an expense of the
party
requesting such opinion but in any case shall not be an expense of the Trustee),
adversely affect in any material respect the interests of any Certificateholder;
provided that any such amendment shall be deemed not to adversely affect in
any
material respect the interests of the Certificateholders and no such Opinion
of
Counsel shall be required if the Person requesting such amendment obtains a
letter from each
Rating
Agency
stating
that such amendment would not result in the downgrading or withdrawal of the
respective ratings then assigned to the Certificates.
Notwithstanding
the foregoing, without the consent of the Certificateholders, the parties hereto
may at any time and from time to time amend this Agreement to modify, eliminate
or add to any of its provisions to such extent as shall be necessary or
appropriate to maintain the qualification of any of REMIC
I,
REMIC II, REMIC III, REMIC IV or REMIC V as
a
REMIC under the Code or to avoid or minimize the risk of the imposition of
any
tax on any of REMIC
I,
REMIC II, REMIC III, REMIC IV or REMIC V pursuant
to the Code that would be a claim against any of REMIC
I,
REMIC II, REMIC III, REMIC IV or REMIC V
at any
time prior to the final redemption of the Certificates, provided that the
Trustee, the Securities Administrator have been provided an Opinion of Counsel
addressed to the Trustee and the Securities Administrator, which opinion shall
be an expense of the party requesting such opinion but in any case shall not
be
an expense of the Trustee, the Securities Administrator or the Trust Fund,
to
the effect that such action is necessary or appropriate to maintain such
qualification or to avoid or minimize the risk of the imposition of such a
tax.
This
Agreement may also be amended from time to time by the parties hereto with
the
consent
of Holders of the Certificates evidencing over 50% of the aggregate Certificate
Principal Balance of the Certificates, or with the consent of the holders of
each Class of Certificates affected thereby evidencing over 50% of the aggregate
Certificate Principal Balance of that Class, as applicable, for
the
purpose of adding any provisions to or changing in any manner or eliminating
any
of the provisions of this Agreement or of modifying in any manner the rights
of
the Holders of Certificates; provided that no such amendment shall (i) reduce
in
any manner the amount of, or delay the timing of, payments required to be
distributed on any Certificate without the consent of the Holder of such
Certificate, (ii) cause any of REMIC
I,
REMIC II, REMIC III, REMIC IV or REMIC V to
cease
to qualify as a REMIC or (iii) reduce the aforesaid percentages of Certificates
of each Class the Holders of which are required to consent to any such amendment
without the consent of the Holders of all Certificates of such Class then
outstanding.
Notwithstanding
any contrary provision of this Agreement, the Trustee shall not consent to
any
amendment to this Agreement unless it shall have first received an Opinion
of
Counsel addressed to the Trustee and the Securities Administrator, which opinion
shall be an expense of the party requesting such amendment but in any case
shall
not be an expense of the Trustee or the Securities Administrator, to the effect
that such amendment will not (other than an amendment pursuant to clause (ii)
of, and in accordance with, the preceding paragraph) cause the imposition of
any
tax on any of REMIC I, REMIC II, REMIC III, REMIC IV or REMIC V or the
Certificateholders or cause any of REMIC I, REMIC II, REMIC III, REMIC IV or
REMIC V to cease to qualify as a REMIC at any time that any Certificates are
outstanding. Further, nothing in this Agreement shall require the Trustee to
enter into an amendment without receiving an Opinion of Counsel, satisfactory
to
the Trustee (i) that such amendment is permitted and is not prohibited by this
Agreement and (ii) that all requirements for amending this Agreement (including
any consent of the applicable Certificateholders) have been complied
with.
Notwithstanding
any of the other provisions of this Section 12.01, none of the Depositor, the
Master Servicer, the Company, the Securities Administrator or the Trustee shall
enter into any amendment to Section 4.14 or Section 6.04(a)(3)(F) of this
Agreement without the prior written consent of the Swap Provider, which consent
shall not be unreasonably withheld, and shall not enter into an amendment that
has a materially adverse effect on the Swap Provider without the prior written
consent of the Swap Provider, which consent shall not be unreasonably
withheld.
Promptly
after the execution of any amendment to this Agreement requiring the consent
of
Certificateholders, the Securities Administrator shall furnish written
notification of the substance of such amendment to each Certificateholder,
the
Swap Provider and each
Rating
Agency.
It
shall
not be necessary for the consent of Certificateholders under this Section to
approve the particular form of any proposed amendment, but it shall be
sufficient if such consent shall approve the substance thereof. The manner
of
obtaining such consents and of evidencing the authorization of the execution
thereof by Certificateholders shall be subject to such reasonable regulations
as
the Trustee may prescribe.
Section
12.02 Recordation
of Agreement; Counterparts.
To
the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all of the counties
or other comparable jurisdictions in which any or all of the Mortgaged
Properties are situated, and in any other appropriate public recording office
or
elsewhere. The Master Servicer shall effect such recordation at the Trust’s
expense upon the request in writing of a Certificateholder, but only if such
direction is accompanied by an Opinion of Counsel (provided at the expense
of
the Certificateholder requesting recordation) to the effect that such
recordation would materially and beneficially affect the interests of the
Certificateholders or is required by law.
For
the
purpose of facilitating the recordation of this Agreement as herein provided
and
for other purposes, this Agreement may be executed simultaneously in any number
of counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same
instrument.
Section
12.03 Governing
Law.
THIS
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF (OTHER THAN
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAWS).
Section
12.04 Intention
of Parties.
It
is the
express intent of the parties hereto that the conveyance of the Mortgage Notes,
Mortgages, assignments of Mortgages, title insurance policies and any
modifications, extensions and/or assumption agreements and private mortgage
insurance policies relating to the Mortgage Loans by the Seller to the
Depositor, and by the Depositor to the Trustee be, and be construed as, an
absolute sale thereof to the Depositor or the Trustee, as applicable. It is,
further, not the intention of the parties that such conveyance be deemed a
pledge thereof by each Seller to the Depositor, or by the Depositor to the
Trustee. However, in the event that, notwithstanding the intent of the parties,
such assets are held to be the property of the Seller or the Depositor, as
applicable, or if for any other reason the Mortgage Loan Purchase Agreement
or
this Agreement is held or deemed to create a security interest in such assets,
then (i) the Mortgage Loan Purchase Agreement and this Agreement shall each
be
deemed to be a security agreement within the meaning of the Uniform Commercial
Code of the State of New York and (ii) the conveyance provided for in the
Mortgage Loan Purchase Agreement from the Seller to the Depositor, and the
conveyance provided for in this Agreement from the Depositor to the Trustee,
shall be deemed to be an assignment and a grant by the Seller or the Depositor,
as applicable, for the benefit of the Certificateholders of a security interest
in all of the assets that constitute the Trust Fund, whether now owned or
hereafter acquired.
The
Depositor for the benefit of the Certificateholders shall, to the extent
consistent with this Agreement, take such actions as may be necessary to ensure
that, if this Agreement were deemed to create a security interest in the assets
of the Trust Fund, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of the Agreement.
Section
12.05 Notices.
(a) The
Securities Administrator shall use
its
best efforts to
promptly
provide notice to each Rating Agency and the Swap Provider with respect to
each
of the following of which a Responsible Officer of the Securities Administrator
has actual knowledge:
(i) Any
material change or amendment to this Agreement;
(ii) The
occurrence of any Event of Default that has not been cured;
(iii) The
resignation or termination of the Master Servicer, the Securities Administrator
or the Trustee and the appointment of any successor;
(iv) The
repurchase or substitution of Mortgage Loans pursuant to Sections 2.02, 2.03,
3.05 and 11.01; and
(v) The
final
payment to Certificateholders.
(b) All
directions, demands and notices hereunder shall be in writing and shall be
deemed to have been duly given when delivered at or mailed by registered mail,
return receipt requested, postage prepaid, or by recognized overnight courier,
or by facsimile transmission to a number provided by the appropriate party
if
receipt of such transmission is confirmed to (i) in the case of the Depositor,
Bear Xxxxxxx Asset Backed Securities I LLC, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Chief Counsel and with respect to Regulation AB
notifications to the Depositor at xxxxxxxxxxxxxxxxxx@xxxx.xxx; (ii) in the
case
of EMC or the Company, EMC Mortgage Corporation, 0000 Xxxx Xxxxx Xxxxx,
Xxxxxxxxxx, Xxxxx 00000 (Facsimile: (000) 000-0000), attention: President or
General Counsel or such other address as may be hereafter furnished to the
other
parties hereto by the Master Servicer in writing; (iii) in the case of the
Trustee, at its Corporate Trust Office or such other address as the Trustee
may
hereafter furnish to the other parties hereto, (iv) in the case of the Master
Servicer or the Securities Administrator, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxxx 00000, Attention: Global Securities and Trust Services
Group-SACO 2006-9 or such other address as may be hereafter furnished to the
other parties hereto by the Securities Administrator in writing, (v) in the
case
of Moody’s, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Home Equity
Monitoring, or such other address as may be hereafter furnished to the other
parties hereto by Moody’s in writing, (vi) in the case of Standard & Poor’s,
a division of The XxXxxx-Xxxx Companies, Inc., 00 Xxxxx Xxxxxx, 00xx Xxxxx,
Xxx
Xxxx, Xxx Xxxx 00000 or such other address as may be hereafter furnished to
the
other parties hereto by Standard & Poor’s in writing and (vii) in the case
of the Swap Provider, Wachovia Bank, N.A., 000
Xxxxx
Xxxxxxx Xxxxxx, XX-0, Xxxxxxxxx, XX 00000-0000, Attention: Xxxxx X.
Xxxxx.
Any
notice delivered to EMC, the Master Servicer, the Securities Administrator
or
the Trustee under this Agreement shall be effective only upon receipt. Any
notice required or permitted to be mailed to a Certificateholder, unless
otherwise provided herein, shall be given by first-class mail, postage prepaid,
at the address of such Certificateholder as shown in the Certificate Register;
any notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the
Certificateholder receives such notice.
Section
12.06 Severability
of Provisions.
If
any
one or more of the covenants, agreements, provisions or terms of this Agreement
shall be for any reason whatsoever held invalid, 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
or of the Certificates or the rights of the Holders thereof.
Section
12.07 Assignment.
Notwithstanding
anything to the contrary contained herein, except as provided pursuant to
Section 8.02, this Agreement may not be assigned by the Master Servicer,
EMC
or the
Depositor.
Section
12.08 Limitation
on Rights of Certificateholders.
The
death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder’s legal
representative or heirs to claim an accounting or to take any action or commence
any proceeding in any court for a petition or winding up of the Trust Fund,
or
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No
Certificateholder shall have any right to vote (except as provided herein)
or in
any manner otherwise control the operation and management of the Trust Fund,
or
the obligations of the parties hereto, nor shall anything herein set forth
or
contained in the terms of the Certificates be construed so as to constitute
the
Certificateholders from time to time as partners or members of an association;
nor shall any Certificateholder be under any liability to any third party by
reason of any action taken by the parties to this Agreement pursuant to any
provision hereof.
No
Certificateholder shall have any right by virtue or by availing itself of any
provisions of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of an Event
of Default and of the continuance thereof, as hereinbefore provided, the Holders
of Certificates evidencing not less than 25% of the Voting Rights evidenced
by
the Certificates shall also have made written request to the Trustee to
institute such action, suit or proceeding in its own name as Trustee hereunder
and shall have offered to the Trustee such reasonable indemnity as it may
require against the costs, expenses, and liabilities to be incurred therein
or
thereby, and the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity shall have neglected or refused to institute any such
action, suit or proceeding; it being understood and intended, and being
expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing itself
or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, or to obtain or
seek
to obtain priority over or preference to any other such Holder or to enforce
any
right under this Agreement, except in the manner herein provided and for the
common benefit of all Certificateholders. For the protection and enforcement
of
the provisions of this Section 12.08, each and every Certificateholder and
the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section
12.09 Inspection
and Audit Rights.
The
Master Servicer agrees that, on reasonable prior notice, it will permit any
representative of the Depositor or the Trustee during the Master Servicer’s
normal business hours, to examine all the books of account, records, reports
and
other papers of the Master Servicer relating to the Mortgage Loans, to make
copies and extracts therefrom, to cause such books to be audited by independent
certified public accountants selected by the Depositor and the Trustee and
to
discuss its affairs, finances and accounts relating to such Mortgage Loans
with
its officers, employees and independent public accountants (and by this
provision the Master Servicer hereby authorizes such accountants to discuss
with
such representative such affairs, finances and accounts), all at such reasonable
times and as often as may be reasonably requested. Any out-of-pocket expense
incident to the exercise by the Depositor or the Trustee of any right under
this
Section 12.09 shall be borne by the party requesting such inspection, subject
to
such party’s right to reimbursement hereunder (in the case of the Trustee,
pursuant to Section 10.05 hereof.
Section
12.10 Certificates
Nonassessable and Fully Paid.
It
is the
intention of the Depositor that Certificateholders shall not be personally
liable for obligations of the Trust Fund, that the interests in the Trust Fund
represented by the Certificates shall be nonassessable for any reason
whatsoever, and that the Certificates, upon due authentication thereof by the
Securities Administrator pursuant to this Agreement, are and shall be deemed
fully paid.
Section
12.11 Third
Party Rights.
The
Swap
Provider shall be an express third-party beneficiary of this Agreement to the
extent of its express rights to receive any payments under this Agreement
or
any
other express rights of
the
Swap Provider explicitly
stated in this Agreement,
and
shall have the right to enforce such rights under this
Agreement as if it were a party hereto. The Swap Administrator shall be an
express third-party beneficiary of this Agreement to the extent of its express
rights to receive any payments under this Agreement or
any
other express rights of
the
Swap Administrator explicitly
stated in this Agreement,
and
shall have the right to enforce such rights under this
Agreement as if it were a party hereto.
*
*
*
IN
WITNESS WHEREOF, the Depositor, the Seller, the Company, the Master Servicer,
the Securities Administrator and the Trustee have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of
the
day and year first above written.
|
BEAR
XXXXXXX ASSET BACKED
SECURITIES
I LLC,
as
Depositor
|
||||||||||||||
|
By:
|
/s/
Xxxxxx X. Xxxxxxxxx, Xx.
|
|||||||||||||
|
Name:
|
Xxxxxx
X. Xxxxxxxxx, Xx.
|
|||||||||||||
|
Title:
|
Vice
President
|
|||||||||||||
|
EMC
MORTGAGE CORPORATION,
as
Seller and Company
|
||||||||||||||
|
By:
|
/s/ Xxxxxxx Xxxxxxx, Xx. | |||||||||||||
|
Name:
|
Xxxxxxx Xxxxxxx, Xx. | |||||||||||||
|
Title:
|
Executive Vice President | |||||||||||||
|
LASALLE
BANK NATIONAL
ASSOCIATION,
as
Master Servicer and Securities Administrator
|
||||||||||||||
|
By:
|
/s/ Xxxx Xxxxx | |||||||||||||
|
Name:
|
Xxxx Xxxxx | |||||||||||||
|
Title:
|
Vice President | |||||||||||||
|
CITIBANK,
N.A.,
as
Trustee
|
||||||||||||||
|
By:
|
/s/ Xxxx Xxxxxx | |||||||||||||
|
Name:
|
Xxxx Xxxxxx | |||||||||||||
|
Title:
|
Assistant Vice President | |||||||||||||
|
STATE
OF NEW YORK
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
On
this
30th
day of
August, 2006, before me, a notary public in and for said State, appeared Xxxxxx
X. Xxxxxxxxx, Xx., personally known to me on the basis of satisfactory evidence
to be an authorized representative of Bear Xxxxxxx Asset Backed Securities
I
LLC, one of the companies that executed the within instrument, and also known
to
me to be the person who executed it on behalf of such limited liability company
and acknowledged to me that such limited liability company executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
|
Notary
Public
|
[Notarial
Seal]
|
STATE
OF TEXAS
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF DALLAS
|
)
|
On
this
30th
day of
August, 2006, before me, a notary public in and for said State, appeared
_______________________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of EMC Mortgage Corporation, one
of
the corporations that executed the within instrument, and also known to me
to be
the person who executed it on behalf of such corporation and acknowledged to
me
that such corporation executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
|
Notary
Public
|
[Notarial
Seal]
|
STATE
OF ILLINOIS
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF
|
)
|
On
this
30th
day of
August, 2006, before me, a notary public in and for said State, appeared
___________, personally known to me on the basis of satisfactory evidence to
be
a(n) __________________ of LaSalle Bank National Association that executed
the
within instrument, and also known to me to be the person who executed it on
behalf of such national banking association, and acknowledged to me that such
national banking association executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
|
Notary
Public
|
[Notarial
Seal]
|
STATE
OF NEW YORK
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
On
this
30th
day of
August, 2006, before me, a notary public in and for said State, appeared
________________, personally known to me on the basis of satisfactory evidence
to be an authorized representative of Citibank, N.A. that executed the within
instrument, and also known to me to be the person who executed it on behalf
of
such national banking association, and acknowledged to me that such national
banking association executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
|
Notary
Public
|
EXHIBIT
A-1
FORM
OF CLASS A CERTIFICATES
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A “REGULAR
INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF
1986 (THE “CODE”).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY THE
PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY,
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN
BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL
BALANCE BY INQUIRY OF THE SECURITIES ADMINISTRATOR NAMED
HEREIN.
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
PRIOR
TO THE TERMINATION OF THE SUPPLEMENTAL INTEREST TRUST, ANY PERSON ACQUIRING
A
CERTIFICATE SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS IN SECTION 7.02(h)
OF THE POOLING AND SERVICING AGREEMENT
|
Certificate
No. 1
|
Adjustable
Rate
|
|
Class
A
|
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date:
August
1, 2006
|
Aggregate
Initial Certificate Principal
Balance
of this Certificate as of the Cut-off
Date:
$[__________]
|
|
First
Distribution Date:
September
25, 2006
|
Initial
Certificate Principal Balance of this
Certificate
as of the Cut-off Date:
$[__________]
|
|
Master
Servicer and Securities Administrator:
LaSalle
Bank National Association
|
CUSIP:
[__________]
|
|
Last
Scheduled Distribution Date:
September
25, 2036
|
MORTGAGE-BACKED
CERTIFICATE
SERIES
2006-9
evidencing
a Percentage Interest in the distributions allocable to the Class A Certificates
with respect to a Trust Fund consisting primarily of a pool of certain fixed
rate, junior lien one- to four-family fixed and adjustable interest rate
mortgage loans sold by BEAR XXXXXXX ASSET BACKED SECURITIES I LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer, the Securities Administrator or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by
any
governmental entity or by Bear Xxxxxxx Asset Backed Securities I LLC, the
Master
Servicer, the Securities Administrator or the Trustee or any of their affiliates
or any other person. None of Bear Xxxxxxx Asset Backed Securities I LLC,
the
Master Servicer or any of their affiliates will have any obligation with
respect
to any certificate or other obligation secured by or payable from payments
on
the Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional, closed-end, second lien, fixed and adjustable
rate
mortgage loans secured by one- to four- family residences (collectively,
the
“Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed Securities I LLC (“BSABS
I”). The Mortgage Loans were sold by EMC Mortgage Corporation (“EMC”) to BSABS
I. LaSalle Bank National Association will act as master servicer of the Mortgage
Loans (in that capacity, the “Master Servicer,” which term includes any
successors thereto under the Agreement referred to below). The Trust Fund
was
created pursuant to the Pooling and Servicing Agreement, dated as of the
Cut-off
Date specified above (the “Agreement”), among BSABS I, as depositor (the
“Depositor”), EMC Mortgage Corporation as seller and company, LaSalle Bank
National Association, as Master Servicer and securities administrator (the
“Securities Administrator”) and Citibank, N.A., as trustee (the “Trustee”), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, capitalized terms used herein shall have
the
meaning ascribed to them in the Agreement. This Certificate is issued under
and
is subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
Interest
on this Certificate will accrue from and including the 25th day of the calendar
month preceding the month in which a Distribution Date (as hereinafter defined)
occurs to and including the 24th day of the calendar month in which that
Distribution Date occurs on the Certificate Principal Balance hereof at a
per
annum rate equal to the Pass-Through Rate set forth above. The Securities
Administrator will distribute on the 25th day of each month, or, if such
25th
day is not a Business Day, the immediately following Business Day (each,
a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the Business Day immediately preceding such Distribution Date,
an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount (of interest and principal, if any) required to
be
distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date
in the
month following the latest scheduled maturity date of any Mortgage Loan and
is
not likely to be the date on which the Certificate Principal Balance of this
Class of Certificates will be reduced to zero.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice. The initial Certificate Principal Balance of this
Certificate is set forth above. The Certificate Principal Balance hereof
will be
reduced to the extent of distributions allocable to principal hereon and
any
Realized Losses allocable hereto.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that neither the
Trustee
nor the Securities Administrator is liable to the Certificateholders for
any
amount payable under this Certificate or the Agreement or, except as expressly
provided in the Agreement, subject to any liability under the
Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator and the Trustee.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Certificates
evidencing over 50% of the aggregate Certificate Principal Balance of the
Certificates, or with the consent of the Holders of each Class of Certificates
affected thereby evidencing over 50% of the aggregate Certificate Principal
Balance of that class, as applicable. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in lieu hereof whether or not notation of such consent is made
upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
Prior
to
the termination of the Supplemental Interest Trust, any transferee of this
Certificate shall be deemed to make the representations in Section 7.02(h)
of
the Agreement.
The
Certificates are issuable only as registered Certificates without coupons
and in
the Classes and denominations specified in the Agreement. As provided in
the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Securities Administrator,
the
Trustee and any agent of any of them may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none
of the
Depositor, the Master Servicer, the Securities Administrator, the Trustee
or any
such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of
the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust Fund
created by the Agreement continue beyond the earlier of (i) the expiration
of 21
years after the death of certain persons identified in the Agreement and
(ii)
the Latest Possible Maturity Date (as defined in the Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated:
____________, 2006
|
LASALLE
BANK NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Securities Administrator
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class A Certificates referred to in the within-mentioned
Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION,
Authorized signatory of LaSalle
Bank National Association , not in its individual
capacity but solely as Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
Dated:
|
|
|
Signature
by or on behalf of assignor
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
|
The
assignee should include the following for purposes of
distribution:
|
|||||||
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-2
Form
of
Class M-[1][2][3][4][5][6] Certificates
THIS
CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES
[,]
[THE CLASS M-1 CERTIFICATES] [,] [THE CLASS M-2 CERTIFICATES] [,] [THE CLASS
M-3
CERTIFICATES] [,] [THE CLASS M-4 CERTIFICATES] [,] [THE CLASS M-5 CERTIFICATES]
[,] [AND] [THE CLASS M-6 CERTIFICATES] AS DESCRIBED IN THE AGREEMENT (AS
DEFINED
BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A “REGULAR
INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF
1986 (THE “CODE”).
EACH
HOLDER OF A CERTIFICATE OR BENEFICIAL OWNERSHIP SHALL BE DEEMED TO HAVE MADE
THE
REPRESENTATIONS SET FORTH IN SECTION 7.02(h) OF THE POOLING AND SERVICING
AGREEMENT.
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY THE
PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY,
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN
BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL
BALANCE BY INQUIRY OF THE SECURITIES ADMINISTRATOR NAMED
HEREIN.
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
|
Certificate
No.1
|
Adjustable
Rate
|
|
Class
M-[1][2][3][4][5][6] Subordinate
|
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date:
August
1, 2006
|
Aggregate
Initial Certificate Principal
Balance
of this Certificate as of the Cut-off
Date:
$[__________]
|
|
First
Distribution Date:
September
25, 2006
|
Initial
Certificate Principal Balance of this
Certificate
as of the Cut-off Date:
$[__________]
|
|
Master
Servicer and Securities Administrator:
LaSalle
Bank National Association
|
CUSIP:
[__________]
|
|
Last
Scheduled Distribution Date:
September
25, 2036
|
|
SACO
I
TRUST 2006-9
MORTGAGE-BACKED
CERTIFICATE
SERIES
2006-9
evidencing
a Percentage Interest in the distributions allocable to the Class
M-[1][2][3][4][5][6] Certificates with respect to a Trust Fund consisting
primarily of a pool of certain fixed rate, junior lien one- to four-family
fixed
and adjustable interest rate mortgage loans sold by BEAR XXXXXXX ASSET BACKED
SECURITIES I LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer, the Securities Administrator or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by
any
governmental entity or by Bear Xxxxxxx Asset Backed Securities I LLC, the
Master
Servicer, the Securities Administrator or the Trustee or any of their affiliates
or any other person. None of Bear Xxxxxxx Asset Backed Securities I LLC,
the
Master Servicer or any of their affiliates will have any obligation with
respect
to any certificate or other obligation secured by or payable from payments
on
the Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional, closed-end, second lien, fixed and adjustable
rate
mortgage loans secured by one- to four- family residences (collectively,
the
“Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed Securities I LLC (“BSABS
I”). The Mortgage Loans were sold by EMC Mortgage Corporation (“EMC”) to BSABS
I. LaSalle Bank National Association will act as master servicer of the Mortgage
Loans (in that capacity, the “Master Servicer,” which term includes any
successors thereto under the Agreement referred to below). The Trust Fund
was
created pursuant to the Pooling and Servicing Agreement, dated as of the
Cut-off
Date specified above (the “Agreement”), among BSABS I, as depositor (the
“Depositor”), EMC Mortgage Corporation as seller and company, LaSalle Bank
National Association, as Master Servicer and securities administrator (the
“Securities Administrator”) and Citibank, N.A., as trustee (the “Trustee”), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, capitalized terms used herein shall have
the
meaning ascribed to them in the Agreement. This Certificate is issued under
and
is subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
Interest
on this Certificate will accrue from and including the 25th day of the calendar
month preceding the month in which a Distribution Date (as hereinafter defined)
occurs to and including the 24th day of the calendar month in which that
Distribution Date occurs on the Certificate Principal Balance hereof at a
per
annum rate equal to the Pass-Through Rate set forth above. The Securities
Administrator will distribute on the 25th day of each month, or, if such
25th
day is not a Business Day, the immediately following Business Day (each,
a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the Business Day immediately preceding such Distribution Date,
an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount (of interest and principal, if any) required to
be
distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date
in the
month following the latest scheduled maturity date of any Mortgage Loan and
is
not likely to be the date on which the Certificate Principal Balance of this
Class of Certificates will be reduced to zero.
Each
holder of a Certificate or beneficial ownership shall be deemed to have made
the
representations set forth in Section 7.02(h) of the Pooling and Servicing
Agreement.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice. The initial Certificate Principal Balance of this
Certificate is set forth above. The Certificate Principal Balance hereof
will be
reduced to the extent of distributions allocable to principal hereon and
any
Realized Losses allocable hereto.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that neither the
Trustee
nor the Securities Administrator is liable to the Certificateholders for
any
amount payable under this Certificate or the Agreement or, except as expressly
provided in the Agreement, subject to any liability under the
Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator and the Trustee.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Certificates
evidencing over 50% of the aggregate Certificate Principal Balance of the
Certificates, or with the consent of the Holders of each Class of Certificates
affected thereby evidencing over 50% of the aggregate Certificate Principal
Balance of that class, as applicable. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in lieu hereof whether or not notation of such consent is made
upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Securities Administrator,
the
Trustee and any agent of any of them may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none
of the
Depositor, the Master Servicer, the Securities Administrator, the Trustee
or any
such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of
the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust Fund
created by the Agreement continue beyond the earlier of (i) the expiration
of 21
years after the death of certain persons identified in the Agreement and
(ii)
the Latest Possible Maturity Date (as defined in the Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated:
____________, 2006
|
LASALLE
BANK NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Securities Administrator
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class M-[1][2][3][4][5][6] Certificates referred to in the
within-mentioned Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION,
Authorized signatory of LaSalle
Bank National Association , not in its individual
capacity but solely as Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
Dated:
|
|
|
Signature
by or on behalf of assignor
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
|
The
assignee should include the following for purposes of
distribution:
|
|||||||
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-3
FORM
OF
CLASS B-[1][2][3][4]
CERTIFICATES
THIS
CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES,
CLASS M CERTIFICATES [,] [AND] [CLASS B-2 CERTIFICATES] [,] [AND] [CLASS
[,] B-3
CERTIFICATES] AS DESCRIBED IN THE AGREEMENT (AS DEFINED
BELOW).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY THE
PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE THERETO. ACCORDINGLY,
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN
BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL
BALANCE BY INQUIRY OF THE SECURITIES ADMINISTRATOR NAMED
HEREIN.
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A “REGULAR
INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF
1986, AS AMENDED (THE “CODE”).
EACH
HOLDER OF A CERTIFICATE OR BENEFICIAL OWNERSHIP SHALL BE DEEMED TO HAVE MADE
THE
REPRESENTATIONS SET FORTH IN SECTION 7.02(h) OF THE POOLING AND SERVICING
AGREEMENT.
[For
Class B-4] [THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND
MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT
AND
LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS THAT ARE EXEMPT FROM REGISTRATION
UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN ACCORDANCE
WITH THE PROVISIONS OF SECTION 7.02(h) OF THE AGREEMENT.]
[For
Class B-4] [NOTWITHSTANDING THE PREVIOUS PARAGRAPH, A CERTIFICATION WILL
NOT BE
REQUIRED WITH RESPECT TO THE TRANSFER OF THIS CERTIFICATE TO A DEPOSITORY,
OR
FOR ANY SUBSEQUENT TRANSFER OF THIS CERTIFICATE FOR SO LONG AS THIS CERTIFICATE
IS A BOOK-ENTRY CERTIFICATE. ANY TRANSFEREE OF THIS CERTIFICATE WILL BE DEEMED
TO HAVE REPRESENTED BY VIRTUE OF ITS PURCHASE OR HOLDING OF THIS CERTIFICATE
(OR
INTEREST HEREIN) THAT SUCH TRANSFEREE IS A “QUALIFIED INSTITUTIONAL BUYER”
WITHIN THE MEANING OF RULE 144A UNDER THE 1933 ACT.]
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
[For
Class B-4] [THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY,
OR
ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH
IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974,
AS
AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS THAT THE PROPOSED TRANSFER
AND
HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND OPERATION OF THE
TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION WHICH
IS
NOT COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED TRANSACTION EXEMPTION,
INCLUDING, BUT NOT LIMITED TO, PROHIBITED TRANSACTION EXEMPTION (“PTE”) 84-14,
XXX 00-00, XXX 00-0, XXX 95-60 OR PTE 96-23 AND (II) WILL NOT GIVE RISE TO
ANY
DIFFERENT OR ADDITIONAL OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE MASTER
SERVICER, THE SECURITIES ADMINISTRATOR OR THE TRUSTEE, WHICH WILL BE DEEMED
REPRESENTED BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE
OR
UNLESS THE OPINION SPECIFIED IN SECTION 7.02 OF THE AGREEMENT IS
PROVIDED.]
|
Certificate
No. [_]
|
Adjustable
Rate
|
|
Class
B-[1][2][3][4] Subordinate
|
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date:
August
1, 2006
|
Aggregate
Initial Certificate Principal
Balance
of this Certificate as of the Cut-off
Date:
$[__________]
|
|
First
Distribution Date:
September
25, 2006
|
Initial
Certificate Principal Balance of this
Certificate
as of the Cut-off Date:
$[__________]
|
|
Master
Servicer and Securities Administrator:
LaSalle
Bank National Association
|
CUSIP:
[__________]
|
|
Last
Scheduled Distribution Date:
September
25, 2036
|
|
SACO
I
TRUST 2006-9
MORTGAGE-BACKED
CERTIFICATE
SERIES
2006-9
evidencing
a Percentage Interest in the distributions allocable to the Class B-[1][2][3][4]
Certificates with respect to a Trust Fund consisting primarily of a pool
of
certain fixed rate, junior lien one- to four-family fixed and adjustable
interest rate mortgage loans sold by BEAR XXXXXXX ASSET BACKED SECURITIES
I
LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer or the Trustee referred to below or any of their
affiliates or any other person. Neither this Certificate nor the underlying
Mortgage Loans are guaranteed or insured by any governmental entity or by
Bear
Xxxxxxx Asset Backed Securities I LLC, the Master Servicer or the Trustee
or any
of their affiliates or any other person. None of Bear Xxxxxxx Asset Backed
Securities I LLC, the Master Servicer or any of their affiliates will have
any
obligation with respect to any certificate or other obligation secured by
or
payable from payments on the Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional, closed-end, second lien, fixed and adjustable
rate
mortgage loans secured by one- to four- family residences (collectively,
the
“Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed Securities I LLC (“BSABS
I”). The Mortgage Loans were sold by EMC Mortgage Corporation (“EMC”) to BSABS
I. LaSalle Bank National Association will act as master servicer of the Mortgage
Loans (in that capacity, the “Master Servicer,” which term includes any
successors thereto under the Agreement referred to below). The Trust Fund
was
created pursuant to the Pooling and Servicing Agreement, dated as of the
Cut-off
Date specified above (the “Agreement”), among BSABS I, as depositor (the
“Depositor”), EMC Mortgage Corporation as seller and company, LaSalle Bank
National Association, as Master Servicer and securities administrator (the
“Securities Administrator”) and Citibank, N.A., as trustee (the “Trustee”), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, capitalized terms used herein shall have
the
meaning ascribed to them in the Agreement. This Certificate is issued under
and
is subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
[For
Class B-1, Class B-2 and Class B-3] [Interest
on this Certificate will accrue from and including the 25th day of the calendar
month preceding the month in which a Distribution Date (as hereinafter defined)
occurs to and including the 24th day of the calendar month in which that
Distribution Date occurs on the Certificate Principal Balance hereof at a
per
annum rate equal to the Pass-Through Rate set forth above. The Securities
Administrator will distribute on the 25th day of each month, or, if such
25th
day is not a Business Day, the immediately following Business Day (each,
a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the Business Day immediately preceding such Distribution Date,
an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount (of interest and principal, if any) required to
be
distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date
in the
month following the latest scheduled maturity date of any Mortgage Loan and
is
not likely to be the date on which the Certificate Principal Balance of this
Class of Certificates will be reduced to zero.]
[For
Class B-4] [Interest on this Certificate will accrue from and including the
25th
day of the calendar month preceding the month in which a Distribution Date
(as
hereinafter defined) occurs (or, with respect to the first accrual period,
the
Closing Date) to and including the 24th day of the calendar month in which
that
Distribution Date occurs on the Certificate Principal Balance hereof at a
per
annum rate equal to the Pass-Through Rate set forth above and as further
described in the Agreement. The Securities Administrator will distribute
on the
25th day of each month, or, if such 25th day is not a Business Day, the
immediately following Business Day (each, a “Distribution Date”), commencing on
the First Distribution Date specified above, to the Person in whose name
this
Certificate is registered at the close of business on the Business Day
immediately preceding such Distribution Date so long as this Certificate
remains
in book-entry form (and otherwise, the close of business on the last Business
Day of the month immediately preceding the month of such Distribution date),
an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount (of interest and principal, if any) required to
be
distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date
in the month following the latest scheduled maturity date of any Mortgage
Loan.]
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice. The initial Certificate Principal Balance of this
Certificate is set forth above. The Certificate Principal Balance hereof
will be
reduced to the extent of distributions allocable to principal hereon and
any
Realized Losses allocable hereto.
[For
Class B-4] [No
transfer of this Class B-4 Certificate will be made unless such transfer
is (i)
exempt from the registration requirements of the Securities Act of 1933,
as
amended, and any applicable state securities laws or is made in accordance
with
said Act and laws and (ii) made in accordance with Section 7.02 of the
Agreement. Notwithstanding the foregoing, the certifications will not be
required with respect to the transfer of this Certificate to a Depository,
or
for any subsequent transfer of this Certificate for so long as this Certificate
is a Book-Entry Certificate.]
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that neither the
Trustee
nor the Securities Administrator is liable to the Certificateholders for
any
amount payable under this Certificate or the Agreement or, except as expressly
provided in the Agreement, subject to any liability under the
Agreement.
Each
holder of a Certificate or beneficial ownership shall be deemed to have made
the
representations set forth in Section 7.02(h) of the Agreement.
[For
Class B-4] [This Certificate may not be acquired directly or indirectly by,
or
on behalf of, an employee benefit plan or other retirement arrangement which
is
subject to Title I of the Employee Retirement Income Security Act of 1974,
as
amended, or Section 4975 of the Internal Revenue Code of 1986, as amended,
unless the transferee certifies or represents that the proposed transfer
and
holding of a Certificate and the servicing, management and operation of the
trust and its assets: (i) will not result in any prohibited transaction which
is
not covered under an individual or class prohibited transaction exemption,
including, but not limited to, Prohibited Transaction Exemption (“PTE”) 84-14,
XXX 00-00, XXX 00-0, XXX 95-60 or PTE 96-23 and (ii) will not give rise to
any
additional obligations on the part of the Depositor, the Master Servicer
or the
Trustee, which will be deemed represented by an owner of a Book-Entry
Certificate or a Global Certificate or unless an opinion specified in section
7.02 of the Agreement is provided.]
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator and the Trustee.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Certificates
evidencing over 50% of the aggregate Certificate Principal Balance of the
Certificates, or with the consent of the Holders of each Class of Certificates
affected thereby evidencing over 50% of the aggregate Certificate Principal
Balance of that class, as applicable. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in lieu hereof whether or not notation of such consent is made
upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Securities Administrator,
the
Trustee and any agent of any of them may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none
of the
Depositor, the Master Servicer, the Securities Administrator, the Trustee
or any
such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of
the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust Fund
created by the Agreement continue beyond the earlier of (i) the expiration
of 21
years after the death of certain persons identified in the Agreement and
(ii)
the Latest Possible Maturity Date (as defined in the Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated:
____________, 2006
|
LASALLE
BANK NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Securities Administrator
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class B-[1][2][3][4] Certificates referred to in the within-mentioned
Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION,
Authorized signatory of LaSalle
Bank National Association , not in its individual
capacity but solely as Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
Dated:
|
|
|
Signature
by or on behalf of assignor
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
|
The
assignee should include the following for purposes of
distribution:
|
|||||||
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-4
FORM
OF CLASS C CERTIFICATES
THIS
CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES,
THE
CLASS M CERTIFICATES AND THE CLASS B CERTIFICATES AS DESCRIBED IN THE AGREEMENT
(AS DEFINED BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A “REGULAR
INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF
1986 (THE “CODE”).
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE
MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE
144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
(A
“QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF
A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT
TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF
AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN “INSTITUTIONAL ACCREDITED INVESTOR”
WITHIN THE MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION
D
UNDER THE ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN
SUCH
PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT,
SUBJECT TO (A) THE RECEIPT BY THE SECURITIES ADMINISTRATOR OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY
THE
SECURITIES ADMINISTRATOR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE SECURITIES
ADMINISTRATOR THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER
APPLICABLE JURISDICTION.
NO
TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 7.02(h) OF THE AGREEMENT
OR
AN OPINION OF COUNSEL SATISFACTORY TO THE SECURITIES ADMINISTRATOR THAT THE
PURCHASE AND HOLDING OF THIS CERTIFICATE ARE PERMISSIBLE UNDER APPLICABLE
LAW,
WILL NOT CONSTITUTE OR RESULT IN ANY NON-EXEMPT PROHIBITED TRANSACTIONS UNDER
SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
(“ERISA”) OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE TRUSTEE, THE
SECURITIES ADMINISTRATOR, THE MASTER SERVICER OR THE DEPOSITOR TO ANY OBLIGATION
OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN THE
AGREEMENT.
|
Certificate
No.1
|
Percentage
Interest: 100%
|
|
Class
C
|
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date:
August
1, 2006
|
Initial
Certificate Notional Amount of this
Certificate
as of the Cut-off Date:
$[__________]
|
|
First
Distribution Date:
September
25, 2006
|
Aggregate
Certificate Notional Amount of this
Certificate
as of the Cut-off Date:
$[__________]
|
|
Master
Servicer and Securities Administrator:
LaSalle
Bank National Association
|
CUSIP:
[__________]
|
|
Last
Scheduled Distribution Date:
September
25, 2036
|
|
SACO
I
TRUST 2006-9
MORTGAGE-BACKED
CERTIFICATE
SERIES
2006-9
evidencing
a Percentage Interest in the distributions allocable to the Class C Certificates
with respect to a Trust Fund consisting primarily of a pool of certain fixed
rate, junior lien one- to four-family fixed and adjustable interest rate
mortgage loans sold by BEAR XXXXXXX ASSET BACKED SECURITIES I LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer, the Securities Administrator or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by
any
governmental entity or by Bear Xxxxxxx Asset Backed Securities I LLC, the
Master
Servicer, the Securities Administrator or the Trustee or any of their affiliates
or any other person. None of Bear Xxxxxxx Asset Backed Securities I LLC,
the
Master Servicer or any of their affiliates will have any obligation with
respect
to any certificate or other obligation secured by or payable from payments
on
the Certificates.
This
certifies that ______________ is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional, closed-end, second lien, fixed and adjustable
rate
mortgage loans secured by one- to four- family residences (collectively,
the
“Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed Securities I LLC (“BSABS
I”). The Mortgage Loans were sold by EMC Mortgage Corporation (“EMC”) to BSABS
I. LaSalle Bank National Association will act as master servicer of the Mortgage
Loans (in that capacity, the “Master Servicer,” which term includes any
successors thereto under the Agreement referred to below). The Trust Fund
was
created pursuant to the Pooling and Servicing Agreement, dated as of the
Cut-off
Date specified above (the “Agreement”), among BSABS I, as depositor (the
“Depositor”), EMC Mortgage Corporation as seller and company, LaSalle Bank
National Association, as Master Servicer and securities administrator (the
“Securities Administrator”) and Citibank, N.A., as trustee (the “Trustee”), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, capitalized terms used herein shall have
the
meaning ascribed to them in the Agreement. This Certificate is issued under
and
is subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
The
Securities Administrator will distribute on the 25th day of each month, or,
if
such 25th day is not a Business Day, the immediately following Business Day
(each, a “Distribution Date”), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered
at
the close of business on the last day (or if such last day is not a Business
Day, the Business Day immediately preceding such last day) of the calendar
month
immediately preceding the month in which the Distribution Date occurs, an
amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates
of the
same Class as this Certificate.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice.
No
transfer of this Certificate shall be made unless the transfer is made pursuant
to an effective registration statement under the Securities Act of 1933,
as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Securities Administrator shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder’s prospective transferee, substantially in the
forms attached to the Agreement as Exhibit D and either Exhibit E or Exhibit
F,
as applicable, and (ii) in all other cases, an Opinion of Counsel satisfactory
to it that such transfer may be made without such registration or qualification
(which Opinion of Counsel shall not be an expense of the Trust Fund or of
the
Depositor, the Securities Administrator, the Trustee, or the Master Servicer
in
their respective capacities as such), together with copies of the written
certification(s) of the Holder of the Certificate desiring to effect the
transfer and/or such Holder’s prospective transferee upon which such Opinion of
Counsel is based. Neither the Depositor, the Trustee nor the Securities
Administrator is obligated to register or qualify the Class of Certificates
specified on the face hereof under the 1933 Act or any other securities law
or
to take any action not otherwise required under the Agreement to permit the
transfer of such Certificates without registration or qualification. Any
Holder
desiring to effect a transfer of this Certificate shall be required to indemnify
the Trustee, the Securities Administrator, the Depositor, the Seller and
the
Master Servicer against any liability that may result if the transfer is
not so
exempt or is not made in accordance with such federal and state
laws.
No
transfer of this Class C Certificate will be made unless the Securities
Administrator shall have received either (i) the opinion of counsel set forth
in
Section 7.02(h) of the Agreement or (ii) a representation letter under Section
7.02 of the Agreement, in the form as described by the Agreement, stating
that
the transferee is not an employee benefit or other plan subject to the
prohibited transaction provisions of ERISA or Section 4975 of the Code (a
“Plan”), or any other person acting, directly or indirectly, on behalf of or
purchasing any Certificate with “plan assets” of any Plan.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that neither the
Trustee
nor the Securities Administrator is liable to the Certificateholders for
any
amount payable under this Certificate or the Agreement or, except as expressly
provided in the Agreement, subject to any liability under the
Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Trustee and Securities Administrator.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Certificates
evidencing over 50% of the aggregate Certificate Principal Balance of the
Certificates, or with the consent of the Holders of each Class of Certificates
affected thereby evidencing over 50% of the aggregate Certificate Principal
Balance of that class, as applicable. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in lieu hereof whether or not notation of such consent is made
upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Securities Administrator,
the
Trustee and any agent of any of them may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none
of the
Depositor, the Master Servicer, the Securities Administrator, the Trustee
or any
such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of
the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust Fund
created by the Agreement continue beyond the earlier of (i) the expiration
of 21
years after the death of certain persons identified in the Agreement and
(ii)
the Latest Possible Maturity Date (as defined in the Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated:
____________, 2006
|
LASALLE
BANK NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Securities Administrator
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class C Certificates referred to in the within-mentioned
Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION,
Authorized signatory of LaSalle
Bank National Association , not in its individual
capacity but solely as Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
Dated:
|
|
|
Signature
by or on behalf of assignor
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
|
The
assignee should include the following for purposes of
distribution:
|
|||||||
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-5
Form
of Class R-[1][2][3][X] Certificates
THIS
CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED STATES PERSON
OR A
DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “RESIDUAL INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
NO
TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 7.02(h) OF THE AGREEMENT
OR
AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE PURCHASE AND HOLDING
OF THIS CERTIFICATE ARE PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT CONSTITUTE
OR
RESULT IN ANY NON EXEMPT PROHIBITED TRANSACTIONS UNDER SECTION 406 OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION
4975 OF THE CODE AND WILL NOT SUBJECT THE TRUSTEE, MASTER SERVICER OR THE
DEPOSITOR TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN
IN THE
AGREEMENT.
ANY
RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF
THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE SECURITIES
ADMINISTRATOR THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY
STATE
OR POLITICAL SUBDIVISION THEREOF, ANY POSSESSION OF THE UNITED STATES, OR
ANY
AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING (OTHER THAN AN INSTRUMENTALITY
WHICH IS A CORPORATION IF ALL OF ITS ACTIVITIES ARE SUBJECT TO TAX AND EXCEPT
FOR XXXXXXX MAC, A MAJORITY OF ITS BOARD OF DIRECTORS IS NOT SELECTED BY
SUCH
GOVERNMENTAL UNIT), (B) A FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION,
OR
ANY AGENCY OR INSTRUMENTALITY OF EITHER OF THE FOREGOING, (C) ANY ORGANIZATION
(OTHER THAN CERTAIN FARMERS’ COOPERATIVES DESCRIBED IN SECTION 521 OF THE CODE)
WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH
ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE (INCLUDING
THE TAX IMPOSED BY SECTION 511 OF THE CODE ON UNRELATED BUSINESS TAXABLE
INCOME), (D) RURAL ELECTRIC AND TELEPHONE COOPERATIVES DESCRIBED IN SECTION
1381(a)(2)(C) OF THE CODE, (E) AN ELECTING LARGE PARTNERSHIP UNDER SECTION
775(a) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A),
(B),
(C), (D) OR (E) BEING HEREIN REFERRED TO AS A “DISQUALIFIED ORGANIZATION”), OR
(F) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2) SUCH TRANSFEREE IS A UNITED
STATES PERSON UNDER SECTION 7701 OF THE CODE, (3) NO PURPOSE OF SUCH TRANSFER
IS
TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (4) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE
PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO
A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION OR A
NON-UNITED STATES PERSON, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL
FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A
CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED TO,
THE
RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE
BY
ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE
PROVISIONS OF THIS PARAGRAPH.
|
Certificate
No.1
|
|
|
Class
R-[1][2][3][X]
|
Percentage
Interest: 100%
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date:
August
1, 2006
|
|
|
First
Distribution Date:
September
25, 2006
|
|
|
Master
Servicer and Securities Administrator:
LaSalle
Bank National Association
|
CUSIP:
[__________]
|
|
Last
Scheduled Distribution Date:
September
25, 2036
|
|
SACO
I
TRUST 2006-9
MORTGAGE-BACKED
CERTIFICATE
SERIES
2006-9
evidencing
a fractional undivided interest in the distributions allocable to the Class
R-[1][2][3][X] Certificates with respect to a Trust Fund consisting primarily
of
a pool of certain fixed rate, junior lien one- to four-family fixed and
adjustable interest rate mortgage loans sold by BEAR XXXXXXX ASSET BACKED
SECURITIES I LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer, the Securities Administrator or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by
any
governmental entity or by Bear Xxxxxxx Asset Backed Securities I LLC, the
Master
Servicer, the Securities Administrator or the Trustee or any of their affiliates
or any other person. None of Bear Xxxxxxx Asset Backed Securities I LLC,
the
Master Servicer or any of their affiliates will have any obligation with
respect
to any certificate or other obligation secured by or payable from payments
on
the Certificates.
This
certifies that Bear, Xxxxxxx Securities Corp is the registered owner of the
Percentage Interest evidenced hereby in the beneficial ownership interest
of
Certificates of the same Class as this Certificate in a trust (the “Trust Fund”)
generally consisting of conventional, closed-end, second lien, fixed and
adjustable rate mortgage loans secured by one- to four- family residences
(collectively, the “Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed
Securities I LLC (“BSABS I”). The Mortgage Loans were sold by EMC Mortgage
Corporation (“EMC”) to BSABS I. LaSalle Bank National Association will act as
master servicer of the Mortgage Loans (in that capacity, the “Master Servicer,”
which term includes any successors thereto under the Agreement referred to
below). The Trust Fund was created pursuant to the Pooling and Servicing
Agreement, dated as of the Cut-off Date specified above (the “Agreement”), among
BSABS I, as depositor (the “Depositor”), EMC Mortgage Corporation as seller and
company, LaSalle Bank National Association, as Master Servicer and securities
administrator (the “Securities Administrator”) and Citibank, N.A., as trustee
(the “Trustee”), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, capitalized terms
used
herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
Each
Holder of this Certificate will be deemed to have agreed to be bound by the
restrictions set forth in the Agreement to the effect that (i) each person
holding or acquiring any Ownership Interest in this Certificate must be a
Permitted Transferee, (ii) the transfer of any Ownership Interest in this
Certificate will be conditioned upon the delivery to the Trustee of, among
other
things, an affidavit to the effect that it is a Permitted Transferee, (iii)
any
attempted or purported transfer of any Ownership Interest in this Certificate
in
violation of such restrictions will be absolutely null and void and will
vest no
rights in the purported transferee, and (iv) if any person other than a
Permitted Transferee acquires any Ownership Interest in this Certificate
in
violation of such restrictions, then the Depositor will have the right, in
its
sole discretion and without notice to the Holder of this Certificate, to
sell
this Certificate to a purchaser selected by the Depositor, which purchaser
may
be the Depositor, or any affiliate of the Depositor, on such terms and
conditions as the Depositor may choose.
The
Securities Administrator will distribute on the 25th day of each month, or,
if
such 25th day is not a Business Day, the immediately following Business Day
(each, a “Distribution Date”), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered
at
the close of business on the last day (or if such last day is not a Business
Day, the Business Day immediately preceding such last day) of the calendar
month
immediately preceding the month in which the Distribution Date occurs, an
amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates
of the
same Class as this Certificate.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice.
No
transfer of this Class R-[1][2][3][X] Certificate will be made unless the
Trustee and Securities Administrator shall have received either (i) the opinion
of counsel set forth in Section 7.02(h) of the Agreement or (ii) a
representation letter under Section 7.02 of the Agreement, in the form as
described by the Agreement, stating that the transferee is not an employee
benefit or other plan subject to the prohibited transaction provisions of
ERISA
or Section 4975 of the Code (a “Plan”), or any other person acting, directly or
indirectly, on behalf of or purchasing any Certificate with “plan assets” of any
Plan.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
and the
Securities Administrator are not liable to the Certificateholders for any
amount
payable under this Certificate or the Agreement or, except as expressly provided
in the Agreement, subject to any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator and the Trustee.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Certificates
evidencing over 50% of the aggregate Certificate Principal Balance of the
Certificates, or with the consent of the Holders of each Class of Certificates
affected thereby evidencing over 50% of the aggregate Certificate Principal
Balance of that class, as applicable. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in lieu hereof whether or not notation of such consent is made
upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Securities Administrator,
the
Trustee and any agent of any of them may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none
of the
Depositor, the Master Servicer, the Securities Administrator, the Trustee
or any
such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto) of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of
the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust Fund
created by the Agreement continue beyond the earlier of (i) the expiration
of 21
years after the death of certain persons identified in the Agreement and
(ii)
the Latest Possible Maturity Date (as defined in the Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated:
____________, 2006
|
LASALLE
BANK NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Securities Administrator
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class R-[1][2][3][X] Certificates referred to in the within-mentioned
Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION,
Authorized signatory of LaSalle
Bank National Association , not in its individual
capacity but solely as Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
Dated:
|
|
|
Signature
by or on behalf of assignor
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
|
The
assignee should include the following for purposes of
distribution:
|
|||||||
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
B
MORTGAGE
LOAN SCHEDULE
EXHIBIT
C
FORM
OF
TRANSFER AFFIDAVIT
|
Affidavit
pursuant to Section 860E(e)(4) of the Internal Revenue Code of
1986, as
amended, and for other purposes
|
|
STATE
OF
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF
|
)
|
[NAME
OF
OFFICER], being first duly sworn, deposes and says:
1. That
he/she is [Title of Officer] of [Name of Investor] (the “Investor”), a [savings
institution] [corporation] duly organized and existing under the laws of
[the
State of _____] [the United States], on behalf of which he makes this
affidavit.
2. That
(i)
the Investor is not a “disqualified organization” as defined in Section
860E(e)(5) of the Internal Revenue Code of 1986, as amended (the “Code”), or an
electing large partnership as defined in Section 775(a) of the Code, and
will
not be a disqualified organization or an electing large partnership as of
[Closing Date] [date of purchase]; (ii) it is not acquiring the SACO I Trust
2006-9, Series 2006-9, Class R[-1][-2][-3][X] Certificates (the “Residual
Certificates”) for the account of a disqualified organization or an electing
large partnership; (iii) it consents to any amendment of the Pooling and
Servicing Agreement that shall be deemed necessary by Bear Xxxxxxx Asset
Backed
Securities I LLC (upon advice of counsel) to constitute a reasonable arrangement
to ensure that the Residual Certificates will not be owned directly or
indirectly by a disqualified organization or an electing large partnership;
and
(iv) it will not transfer such Residual Certificates unless (a) it has received
from the transferee an affidavit in substantially the same form as this
affidavit containing these same seven representations and (b) as of the time
of
the transfer, it does not have actual knowledge that such affidavit is
false.
3. That
the
Investor is one of the following: (i) a citizen or resident of the United
States, (ii) a corporation or partnership (including an entity treated as
a
corporation or partnership for federal income tax purposes) created or organized
in, or under the laws of, the United States or any state thereof or the District
of Columbia (except, in the case of a partnership, to the extent provided
in
regulations), provided that no partnership or other entity treated as a
partnership for United States federal income tax purposes shall be treated
as a
United States person within the meaning of the Code unless all persons that
own
an interest in such partnership either directly or through any entity that
is
not a corporation for United States federal income tax purposes are United
States persons, (iii) an estate whose income is subject to United States
federal
income tax regardless of its source, or (iv) a trust other than a “foreign
trust” as defined in Section 7701 (a)(31) of the Code.
4. That
the
Investor’s taxpayer identification number is
______________________.
5. That
no
purpose of the acquisition of the Residual Certificates is to avoid or impede
the assessment or collection of tax.
6. That
the
Investor understands that, as the holder of the Residual Certificates, the
Investor may incur tax liabilities in excess of any cash flows generated
by such
Residual Certificates.
7. That
the
Investor intends to pay taxes associated with holding the Residual Certificates
as they become due.
IN
WITNESS WHEREOF, the Investor has caused this instrument to be executed on
its
behalf, pursuant to authority of its Board of Directors, by its [Title of
Officer] this ____ day of _________, 20__.
|
[NAME
OF INVESTOR]
|
|||||||||||||
|
By:
|
|||||||||||||
|
Name:
|
[Name
of Officer]
|
||||||||||||
|
Title:
|
[Title
of Officer]
|
||||||||||||
|
[Address
of Investor for receipt of distributions]
|
|||||||||||||
|
Address
of Investor for receipt of tax
information:
|
|||||||||||||
Personally
appeared before me the above-named [Name of Officer], known or proved to
me to
be the same person who executed the foregoing instrument and to be the [Title
of
Officer] of the Investor, and acknowledged to me that he/she executed the
same
as his/her free act and deed and the free act and deed of the
Investor.
Subscribed
and sworn before me this ___ day of _________, 20___.
NOTARY
PUBLIC
COUNTY
OF
STATE
OF
My
commission expires the ___ day of ___________________, 20___.
EXHIBIT
D
FORM
OF
TRANSFEROR CERTIFICATE
______________,
200___
Bear
Xxxxxxx Asset Backed Securities I LLC
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Attention:
SACO I Trust 2006-9
|
Re:
|
SACO
I Trust 2006-9, Mortgage-Backed Certificates, Series 2006-9 (the
“Certificates”), including the Class [__] Certificates
(the “Privately Offered
Certificates”)
|
Ladies
and Gentlemen:
In
connection with the sale by ___________ (the “Seller”) to ________ (the
“Purchaser”) of $_________ Initial Certificate Principal Balance of
Mortgage-Backed Certificates, Series 2006-9, Class _____ (the “Certificates”),
issued pursuant to the Pooling and Servicing Agreement (the “Pooling and
Servicing Agreement”), dated as of August 1, 2006, among Bear Xxxxxxx Asset
Backed Securities I LLC, as depositor (the “Depositor”), EMC Mortgage
Corporation, as seller and as company, LaSalle Bank National Association
as
master servicer and securities administrator and Citibank, N.A., as trustee
(the
“Trustee”). The Seller hereby certifies, represents and warrants to, a covenants
with, the Depositor and the Trustee that:
Neither
the Seller nor anyone acting on its behalf (a) has offered, pledged, sold,
disposed of or otherwise transferred any Certificate, any interest in any
Certificate or any other similar security to any person in any manner, (b)
has
solicited any offer to buy or to accept a pledge, disposition or other transfer
of any Certificate, any interest in any Certificate or any other similar
security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate
or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner,
or
(e) has taken any other action, that (as to any of (a) through (e) above)
would
constitute a distribution of the Certificates under the Securities Act of
1933
(the “Act”), that would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or that would require
registration or qualification pursuant thereto. The Seller will not act in
any
manner set forth in the foregoing sentence with respect to any Certificate.
The
Seller has not and will not sell or otherwise transfer any of the Certificates,
except in compliance with the provisions of the Pooling and Servicing
Agreement.
|
Very
truly yours,
|
||||||||||||||
|
(Seller)
|
||||||||||||||
|
By:
|
||||||||||||||
|
Name:
|
||||||||||||||
|
Title:
|
||||||||||||||
EXHIBIT
E
FORM
OF
INVESTMENT LETTER (NON-RULE 144A)
[Date]
[SELLER]
Bear
Xxxxxxx Asset Backed Securities I LLC
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
|
Re:
|
SACO
I Trust 2006-9, Mortgage-Backed Certificates, Series 2006-9 (the
“Certificates”), including the Class [__] Certificates
(the “Privately Offered
Certificates”)
|
Dear
Ladies and Gentlemen:
In
connection with our purchase of Privately Offered Certificates, we confirm
that:
|
(i)
|
we
understand that the Privately Offered Certificates are not being
registered under the Securities Act of 1933, as amended (the “Act”) or any
applicable state securities or “Blue Sky” laws, and are being sold to us
in a transaction that is exempt from the registration requirements
of such
laws;
|
|
|
(ii)
|
any
information we desired concerning the Certificates, including the
Privately Offered Certificates, the trust in which the Certificates
represent the entire beneficial ownership interest (the “Trust”) or any
other matter we deemed relevant to our decision to purchase Privately
Offered Certificates has been made available to us;
|
|
|
(iii)
|
we
are able to bear the economic risk of investment in Privately Offered
Certificates; we are an institutional “accredited investor” as defined in
Section 501(a) of Regulation D promulgated under the Act and a
sophisticated institutional investor;
|
|
|
(iv)
|
we
are acquiring Privately Offered Certificates for our own account,
not as
nominee for any other person, and not with a present view to any
distribution or other disposition of the Privately Offered
Certificates;
|
|
|
(v)
|
we
agree the Privately Offered Certificates must be held indefinitely
by us
(and may not be sold, pledged, hypothecated or in any way disposed
of)
unless subsequently registered under the Act and any applicable
state
securities or “Blue Sky” laws or an exemption from the registration
requirements of the Act and any applicable state securities or
“Blue Sky”
laws is available;
|
|
|
(vi)
|
we
agree that in the event that at some future time we wish to dispose
of or
exchange any of the Privately Offered Certificates (such disposition
or
exchange not being currently foreseen or contemplated), we will
not
transfer or exchange any of the Privately Offered Certificates
unless:
|
|
|
(A)
(1) the sale is to an Eligible Purchaser (as defined below), (2)
if
required by the Pooling and Servicing Agreement (as defined below)
a
letter to substantially the same effect as either this letter or,
if the
Eligible Purchaser is a Qualified Institutional Buyer as defined
under
Rule 144A of the Act, the Rule 144A and Related Matters Certificate
in the
form attached to the Pooling and Servicing Agreement (as defined
below)
(or such other documentation as may be acceptable to the Trustee)
is
executed promptly by the purchaser and delivered to the addressees
hereof
and (3) all offers or solicitations in connection with the sale,
whether
directly or through any agent acting on our behalf, are limited
only to
Eligible Purchasers and are not made by means of any form of general
solicitation or general advertising whatsoever; and
|
||
|
(B)
if the Privately Offered Certificate is not registered under the
Act (as
to which we acknowledge you have no obligation), the Privately
Offered
Certificate is sold in a transaction that does not require registration
under the Act and any applicable state securities or “blue sky” laws and,
if LaSalle Bank National Association. (the “Securities Administrator”) so
requests, a satisfactory Opinion of Counsel is furnished to such
effect,
which Opinion of Counsel shall be an expense of the transferor
or the
transferee;
|
||
|
(vii)
|
we
agree to be bound by all of the terms (including those relating
to
restrictions on transfer) of the Pooling and Servicing, pursuant
to which
the Trust was formed; we have reviewed carefully and understand
the terms
of the Pooling and Servicing Agreement;
|
|
|
(viii)
|
we
either: (i) are not acquiring the Privately Offered Certificate
directly
or indirectly by, or on behalf of, an employee benefit plan or
other
retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, and/or section
4975 of
the Internal Revenue Code of 1986, as amended, or (ii) have provided
the
Opinion of Counsel required by the Agreement,
or
(iii) in the case of the Class B-4 Certificates, the transfer (1)
will not
result in a prohibited transaction which is not covered by Prohibited
Transaction Exemption (“PTE”) 84-14, XXX 00-00, XXX 00-0, XXX 95-60 or PTE
96-23 and (2) will not give rise to any additional obligations
on the part
of the Depositor, the Securities Administrator, the Master Servicer
or the
Trustee.
|
|
|
(ix)
|
We
understand that each of the Privately Offered Certificates bears,
and will
continue to bear, a legend to substantiate the following effect:
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES
THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A
“QIB”),
PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT
OF A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER,
RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(2)
PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE
SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN
“INSTITUTIONAL ACCREDITED INVESTOR” WITHIN THE MEANING THEREOF IN RULE
501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT OR ANY
ENTITY IN
WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING
NOT
FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO
(A) THE
RECEIPT BY THE SECURITIES ADMINISTRATOR OF A LETTER SUBSTANTIALLY
IN THE
FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE SECURITIES
ADMINISTRATOR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE SECURITIES
ADMINISTRATOR THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS
IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR
IN EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED
STATES AND ANY OTHER APPLICABLE JURISDICTION. [In
the case of the Class B-4 Certificates]: THIS
CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF
OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH
IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974,
AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS
AMENDED, UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS THAT THE
PROPOSED
TRANSFER AND HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT
AND
OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY
PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER PROHIBITED TRANSACTION
EXEMPTION (“PTE”) 84-14, XXX 00-00, XXX 00-0, XXX 95-60 OR PTE 96-23 AND
(II) WILL NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON THE PART
OF THE
DEPOSITOR, THE MASTER SERVICER OR THE SECURITIES ADMINISTRATOR,
WHICH WILL
BE DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR
A GLOBAL
CERTIFICATE OR UNLESS AN OPINION SPECIFIED IN SECTION 7.02 OF THE
AGREEMENT IS PROVIDED.
|
|
“Eligible
Purchaser”
means a
corporation, partnership or other entity which we have reasonable grounds
to
believe and do believe (i) can make representations with respect to itself
to
substantially the same effect as the representations set forth herein, and
(ii)
is either a Qualified Institutional Buyer as defined under Rule 144A of the
Act
or an institutional “Accredited Investor” as defined under Rule 501 of the
Act.
Terms
not
otherwise defined herein shall have the meanings assigned to them in the
Pooling
and Servicing Agreement, dated as of August 1, 2006, among Bear Xxxxxxx Asset
Backed Securities I LLC, as depositor (the “Depositor”), EMC Mortgage
Corporation, as seller and as company, LaSalle Bank National Association
as
master servicer and securities administrator and Citibank, N.A., as Trustee
(the
“Pooling and Servicing Agreement”).
If
the
Purchaser proposes that its Certificates be registered in the name of a nominee
on its behalf, the Purchaser has identified such nominee below, and has caused
such nominee to complete the Nominee Acknowledgment at the end of this
letter.
Name
of
Nominee (if any): __________________________
IN
WITNESS WHEREOF, this document has been executed by the undersigned who is
duly
authorized to do so on behalf of the undersigned Eligible Purchaser on the
___
day of ________, 20___.
|
Very
truly yours,
|
|||||||||||||
|
[PURCHASER]
|
|||||||||||||
|
By:
|
|||||||||||||
|
(Authorized
Officer)
|
|||||||||||||
|
By:
|
|||||||||||||
|
(Attorney-in-fact)
|
|||||||||||||
Nominee
Acknowledgment
The
undersigned hereby acknowledges and agrees that as to the Certificates being
registered in its name, the sole beneficial owner thereof is and shall be
the
Purchaser identified above, for whom the undersigned is acting as
nominee.
|
[NAME
OF NOMINEE]
|
|||||||||||||
|
By:
|
|||||||||||||
|
(Authorized
Officer)
|
|||||||||||||
|
By:
|
|||||||||||||
|
(Attorney-in-fact)
|
|||||||||||||
EXHIBIT
F
FORM
OF
RULE 144A AND RELATED MATTERS CERTIFICATE
[SELLER]
Bear
Xxxxxxx Asset Backed Securities I LLC
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
|
Re:
|
SACO
I Trust 2006-9, Mortgage-Backed Certificates, Series 2006-9 (the
“Certificates”), including the Class [__] Certificates
(the “Privately Offered
Certificates”)
|
Dear
Ladies and Gentlemen:
In
connection with our purchase of Privately Offered Certificates, the undersigned
certifies to each of the parties to whom this letter is addressed that it
is a
qualified institutional buyer (as defined in Rule 144A under the Securities
Act
of 1933, as amended (the “Act”)) as follows:
1. It
owned
and/or invested on a discretionary basis eligible securities (excluding
affiliate’s securities, bank deposit notes and CD’s, loan participations,
repurchase agreements, securities owned but subject to a repurchase agreement
and swaps), as described below:
Date:
______________, 20__ (must be on or after the close of its most recent fiscal
year)
Amount:
$
_____________________; and
2. The
dollar amount set forth above is:
|
a.
|
greater
than $100 million and the undersigned is one of the following
entities:
|
|
(1)
|
[_]
|
an
insurance company as defined in Section 2(13) of the Act1 ;
or
|
||
|
(2)
|
[_]
|
an
investment company registered under the Investment Company Act
or any
business development company as defined in Section 2(a)(48) of
the
Investment Company Act of 1940; or
|
||
|
(3)
|
[_]
|
a
Small Business Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; or
|
||
|
(4)
|
[_]
|
a
plan (i) established and maintained by a state, its political
subdivisions, or any agency or instrumentality of a state or its
political
subdivisions, the laws of which permit the purchase of securities
of this
type, for the benefit of its employees and (ii) the governing investment
guidelines of which permit the purchase of securities of this type;
or
|
||
|
(5)
|
[_]
|
a
business development company as defined in Section 202(a)(22) of
the
Investment Advisers Act of 1940; or
|
||
|
(6)
|
[_]
|
a
corporation (other than a U.S. bank, savings and loan association
or
equivalent foreign institution), partnership, Massachusetts or
similar
business trust, or an organization described in Section 501(c)(3)
of the
Internal Revenue Code; or
|
||
|
(7)
|
[_]
|
a
U.S. bank, savings and loan association or equivalent foreign institution,
which has an audited net worth of at least $25 million as demonstrated
in
its latest annual financial statements; or
|
||
|
(8)
|
[_]
|
an
investment adviser registered under the Investment Advisers Act;
or
|
||
|
b.
|
[_]
|
greater
than $10 million, and the undersigned is a broker-dealer registered
with
the SEC; or
|
||
|
c.
|
[_]
|
less
than $10 million, and the undersigned is a broker-dealer registered
with
the SEC and will only purchase Rule 144A securities in transactions
in
which it acts as a riskless principal (as defined in Rule 144A);
or
|
||
|
d.
|
[_]
|
less
than $100 million, and the undersigned is an investment company
registered
under the Investment Company Act of 1940, which, together with
one or more
registered investment companies having the same or an affiliated
investment adviser, owns at least $100 million of eligible securities;
or
|
||
|
e.
|
[_]
|
less
than $100 million, and the undersigned is an entity, all the equity
owners
of which are qualified institutional
buyers.
|
||
The
undersigned further certifies that it is purchasing a Privately Offered
Certificate for its own account or for the account of others that independently
qualify as “Qualified Institutional Buyers” as defined in Rule 144A. It is aware
that the sale of the Privately Offered Certificates is being made in reliance
on
its continued compliance with Rule 144A. It is aware that the transferor
may
rely on the exemption from the provisions of Section 5 of the Act provided
by
Rule 144A. The undersigned understands that the Privately Offered Certificates
may be resold, pledged or transferred only to (i) a person reasonably believed
to be a Qualified Institutional Buyer that purchases for its own account
or for
the account of a Qualified Institutional Buyer to whom notice is given that
the
resale, pledge or transfer is being made in reliance in Rule 144A, or (ii)
an
institutional “accredited investor,” as such term is defined under Rule 501 of
the Act in a transaction that otherwise does not constitute a public
offering.
The
undersigned agrees that if at some future time it wishes to dispose of or
exchange any of the Privately Offered Certificates, it will not transfer
or
exchange any of the Privately Offered Certificates to a Qualified Institutional
Buyer without first obtaining a Rule 144A and Related Matters Certificate
in the
form hereof from the transferee and delivering such certificate to the
addressees hereof. Prior to making any transfer of Privately Offered
Certificates, if the proposed Transferee is an institutional “accredited
investor,” the transferor shall obtain from the transferee and deliver to the
addressees hereof an Investment Letter in the form attached to the Pooling
and
Servicing Agreement, dated as of August 1, 2006, among Bear Xxxxxxx Asset
Backed
Securities I LLC, as depositor (the “Depositor”), EMC Mortgage Corporation, as
seller and as company, LaSalle Bank National Association as master servicer
and
securities administrator and Citibank, N.A., as Trustee, pursuant to which
the
Certificates were issued.
The
undersigned certifies that it either: (i) is not acquiring the Privately
Offered
Certificates directly or indirectly by, or on behalf of, an employee benefit
plan or other retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, and/or section 4975 of
the
Internal Revenue Code of 1986, as amended, or (ii) has provided the Opinion
of
Counsel required by the Agreement or (iii) in the case of the Class B-4
Certificates, the transfer (1) will not result in a prohibited transaction
which
is not covered by Prohibited Transaction Exemption (“PTE”) 84-14, XXX 00-00, XXX
00-0, XXX 95-60 or PTE 96-23 and (2) will not give rise to any additional
obligations on the part of the Depositor, the Securities Administrator, the
Master Servicer or the Trustee.
If
the
Purchaser proposes that its Certificates be registered in the name of a nominee
on its behalf, the Purchaser has identified such nominee below, and has caused
such nominee to complete the Nominee Acknowledgment at the end of this
letter.
Name
of
Nominee (if any): ________________________
1 A
purchase by an insurance company for one or more of its separate accounts,
as
defined by Section 2(a)(37) of the Investment Company Act of 1940,
which are
neither registered nor required to be registered thereunder, shall
be deemed to
be a purchase for the account of such insurance company.
IN
WITNESS WHEREOF, this document has been executed by the undersigned who is
duly
authorized to do so on behalf of the undersigned Eligible Purchaser on the
____
day of ___________, 20___.
|
Very
truly yours,
|
|||||||||||||
|
[PURCHASER]
|
|||||||||||||
|
By:
|
|||||||||||||
|
(Authorized
Officer)
|
|||||||||||||
|
By:
|
|||||||||||||
|
(Attorney-in-fact)
|
|||||||||||||
Nominee
Acknowledgment
The
undersigned hereby acknowledges and agrees that as to the Certificates being
registered in its name, the sole beneficial owner thereof is and shall be
the
Purchaser identified above, for whom the undersigned is acting as
nominee.
|
[NAME
OF NOMINEE]
|
|||||||||||||
|
By:
|
|||||||||||||
|
(Authorized
Officer)
|
|||||||||||||
|
By:
|
|||||||||||||
|
(Attorney-in-fact)
|
|||||||||||||
EXHIBIT
G
FORM
OF
REQUEST FOR RELEASE
|
To:
|
LaSalle
Bank National Association
|
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
|
RE:
|
Pooling
and Servicing Agreement, dated as of August 1, 2006, among Bear
Xxxxxxx
Asset Backed Securities I LLC, as Depositor, EMC Mortgage Corporation,
as
seller and as company, LaSalle Bank National Association as master
servicer and securities administrator and Citibank, N.A., as
Trustee
|
In
connection with the administration of the Mortgage Loans held by you pursuant
to
the above-captioned Pooling and Servicing Agreement, we request the release,
and
hereby acknowledge receipt, of the Mortgage File for the Mortgage Loan described
below, for the reason indicated.
Mortgage
Loan Number:
Mortgagor
Name, Address & Zip Code:
Reason
for Requesting Documents (check one):
|
_____
|
1.
|
Mortgage
Paid in Full and proceeds have been deposited into the Custodial
Account
|
||
|
_____
|
2.
|
Foreclosure
|
||
|
_____
|
3.
|
Substitution
|
||
|
_____
|
4.
|
Other
Liquidation
|
||
|
_____
|
5.
|
Nonliquidation
|
Reason:_________________________________
|
|
|
_____
|
6.
|
California
Mortgage Loan paid in full
|
||
|
By:
|
||||||||
|
(authorized
signer)
|
||||||||
|
Issuer:
|
||||||||
|
Address:
|
||||||||
|
Date:
|
EXHIBIT
H
DTC
LETTER OF REPRESENTATIONS
[Provided
Upon Request]
EXHIBIT
I
SCHEDULE
OF MORTGAGE LOANS WITH LOST NOTES
[Provided
Upon Request]
EXHIBIT
J
FORM
OF
LASALLE CUSTODIAL AGREEMENT
THIS
CUSTODIAL AGREEMENT (as amended and supplemented from time to time, the
“Agreement”), dated as of August 30, 2006, by and among CITIBANK, N.A., not
individually but solely as trustee under the Pooling and Servicing Agreement
defined below (in such capacity, including its successors under the Pooling
and
Servicing Agreement defined below, the “Trustee”), BEAR XXXXXXX ASSET BACKED
SECURITIES I LLC, as depositor (together with any successor in interest,
the
“Depositor”), EMC MORTGAGE CORPORATION, as seller (in such capacity, “EMC” or
the “Seller”) and as company (in such capacity, together with any successor in
interest or successor under the Pooling and Servicing Agreement referred
to
below, the “Company”) and LASALLE BANK NATIONAL ASSOCIATION, as master servicer
(together with any successor in interest, the “Master Servicer”), securities
administrator (in that capacity, the “Securities Administrator”) and as
custodian (in such capacity, together with any successor in interest or any
successor in interest or any successor appointed hereunder, the
“Custodian”).
WITNESSETH
THAT:
WHEREAS,
the Depositor, EMC, the Master Servicer, the Securities Administrator and
the
Trustee have entered into a Pooling and Servicing Agreement, dated as of
August
1, 2006, relating to the issuance of SACO I Trust 2006-9, Mortgage-Backed
Certificates, Series 2006-9 (as in effect on the date of this Agreement,
and as
amended and supplemented from time to time, the “Pooling and Servicing
Agreement”).
WHEREAS,
the Custodian has agreed to act as agent for the Trustee on behalf of the
Certificateholders for the purposes of receiving and holding certain documents
and other instruments delivered by the Depositor, the Seller or the Master
Servicer under the Pooling and Servicing Agreement and the Servicers, if
any,
under their respective Servicing Agreements, all upon the terms, conditions
and
obligations and subject to the limitations hereinafter set forth. In the
event
any custodian terms, conditions and obligations are defined in the Pooling
and
Servicing Agreement, this custodial agreement shall supercede;
NOW,
THEREFORE, in consideration of the premises and the mutual covenants and
agreements hereinafter set forth, the Trustee, the Depositor, the Seller,
the
Master Servicer, the Company and the Custodian hereby agree as
follows:
ARTICLE
I
DEFINITIONS
Section
1.1 Definitions.
For
purposes of this Agreement, the following terms shall have the indicated
meanings unless the context or use indicates another or different meaning
and
intent, the definitions of such terms are equally applicable to the singular
and
the plural forms of such terms, the words “herein,” “hereof” and “hereunder” and
other words of similar import refer to this Agreement as a whole and not
to any
particular section or other subdivision, and section references refer to
sections of this Agreement.
“Agreement”
shall mean this Custodial Agreement, as further supplemented or amended from
time to time.
“Business
Day” shall mean any day other than (i) a Saturday or a Sunday, or (ii) a day on
which banking institutions in The City of New York, New York, Chicago, Illinois,
Minneapolis, Minnesota or the city in which the Corporate Trust Office of
the
Trustee or the principal office of the Master Servicer is located are authorized
or obligated by law or executive order to be closed.
“Closing
Date” shall mean August 30, 2006.
“EMC
Flow
Loans” shall mean the Mortgage Loans purchased by EMC pursuant to a flow loan
purchase agreement.
“Master
Servicer” shall mean LaSalle Bank National Association, in its capacity as
master servicer, and its successors and assigns.
“MERS”
shall mean Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.
“MERS
Mortgage Loan” shall mean any Mortgage Loan registered with MERS on the MERS®
system.
“MERS®
System” shall mean the system of recording transfers of Mortgages electronically
maintained by MERS.
“MIN”
shall mean the Mortgage Identification Number for Mortgage Loans registered
with
MERS on the MERS System.
“MOM
Loan” shall mean with respect to any Mortgage Loan, MERS acting as the mortgagee
of such Mortgage Loan, solely as nominee for the originator of such Mortgage
Loan and its successors and assigns, at the origination thereof.
“Mortgage”
shall mean the mortgage, deed of trust or other instrument creating a first
or
second lien on or first or second priority ownership interest in an estate
in
fee simple in real property securing a Mortgage Note.
“Mortgage
Assignment” shall mean an assignment of the Mortgage in recordable form,
sufficient under the laws of the jurisdiction wherein the related Mortgaged
Property is located to reflect the sale of the Mortgage.
“Mortgage
File” shall have the meaning set forth in Section 2 hereof.
“Mortgage
Loan” shall mean a first or subordinate lien mortgage loan or a first or
subordinate lien home equity line of credit on a one-to-four family residential
property.
“Mortgage
Loan Schedule” shall mean the electronic schedule of Mortgage Loans identified
in Schedule A.
“Mortgaged
Property” shall mean the real property securing repayment of a Mortgage
Loan.
“Mortgagor”
shall mean the obligor on a Mortgage Note.
“Note”
shall mean any promissory note or other evidence of indebtedness evidencing
the
indebtedness of a Mortgagor under a Mortgage Loan.
“Servicer”
shall mean the related servicer of the Mortgage Loans.
“Trustee”
shall mean Citibank, N.A., a national banking association, not in its individual
capacity, but solely in its capacity as trustee for the benefit of the
Certificateholders under this Agreement, and any successor thereto, and any
corporation or national banking association resulting from or surviving any
consolidation or merger to which it or its successors may be a party and
any
successor trustee as may from time to time be serving as successor trustee
hereunder.
Any
Capitalized terms used in this Agreement and not defined herein shall have
the
meanings assigned in the Pooling and Servicing Agreement, unless otherwise
required by the context herein.
ARTICLE
II
CUSTODY
OF MORTGAGE DOCUMENTS
Section
2.1 Custodian
to Act as Agent: Acceptance of Mortgage Files.
The
Custodian, as the duly appointed custodial agent of the Trustee for these
purposes, acknowledges (subject to any exceptions noted in the Initial
Certification referred to in Section 2.3(a)) receipt of the Mortgage Files
relating to the Mortgage Loans identified on Schedule A attached hereto (the
“Mortgage Loan Schedule”) and declares that it holds and will hold such Mortgage
Files as agent for the Trustee, in trust, for the use and benefit of all
present
and future Certificateholders.
Section
2.2 Recordation
of Assignments.
If any
Mortgage File includes one or more assignments of Mortgage that have not
been
recorded and the related Mortgage Loan is not a MERS Loan or the Custodian
has
not received written instructions from the Seller or the Trustee that the
related Mortgaged Properties are located in jurisdictions under the laws
of
which the recordation of such assignment is not necessary to protect the
Trustee’s interest therein, each such assignment shall be delivered by the
Custodian to the Seller for the purpose of recording it in the appropriate
public office for real property records, and the Seller, at no expense to
the
Custodian, shall promptly cause to be recorded in the appropriate public
office
for real property records each such assignment of Mortgage and, upon receipt
thereof from such public office, shall return each such assignment of Mortgage
to the Custodian.
Section
2.3 Review
of Mortgage Files.
(a) The
documents set forth in the definition “Mortgage File” herein shall be delivered
and released to the Custodian relating to each of the Mortgage Loans to be
purchased on a Closing Date. The related Mortgage Loans shall be identified
in
the Mortgage Loan Schedule in electronic format which shall be delivered
to the
Custodian by EMC at least two Business Days prior to each Closing Date. On
or
prior to the Closing Date, the Custodian shall deliver to EMC, the Master
Servicer and the Trustee an Initial Certification in the form annexed hereto
as
Exhibit One evidencing receipt (subject to any exceptions noted therein)
of a
Mortgage File for each of the Mortgage Loans listed on Schedule A attached
hereto (the “Mortgage Loan Schedule”).
(b) Within
90
days thereafter, the Custodian agrees, for the benefit of Certificateholders
to
review each such document, and shall deliver to EMC, the Master Servicer
and the
Trustee an Interim Certification in the form annexed hereto as Exhibit Two
to
the effect that all such documents have been executed and received and that
such
documents relate to the Mortgage Loans identified on the Mortgage Loan Schedule,
except for any exceptions listed on Schedule A attached to such Interim
Certification. The Custodian shall be under no duty or obligation to inspect,
review or examine said documents, instruments, certificates or other papers
to
determine that the same are genuine, enforceable, or appropriate for the
represented purpose or that they have actually been recorded or that they
are
other than what they purport to be on their face.
(c) Not
later
than 180 days after the Closing Date, the Custodian shall review, for the
benefit of Certificateholders, the Mortgage Files and deliver to EMC, the
Master
Servicer and the Trustee a Final Certification in the form annexed hereto
as
Exhibit Three evidencing whether each document required to be recorded has
been
returned from the recording office with evidence of recording thereon and
the
Custodian has received either an original or a copy thereof. If the Custodian
finds any document missing, or to be unrelated, determined on the basis of
the
mortgagor name, original principal balance and loan number, to the mortgage
loans identified on the Mortgage Loan Schedule or to appear defective on
its
face, the Custodian shall note such defect in the exception report attached
to
the Final Certification and shall promptly notify the Trustee.
(d) In
reviewing the Mortgage Files as provided herein, the Custodian shall make
no
representation as to and shall not be responsible to verify (i) the validity,
legality, enforceability, due authorization, recordability, sufficiency or
genuineness of any of the documents included in any Mortgage File or (ii)
the
collectibility, insurability, effectiveness or suitability of any of the
documents in any Mortgage File.
In
performing any such review, the Custodian may conclusively rely on the purported
due execution and genuineness of any such document and on the purported
genuineness of any signature thereon.
Upon
receipt of written request from EMC, the Master Servicer, the Securities
Administrator or the Trustee, the Custodian shall as soon as practicable
supply
such entity with a list of all of the documents relating to the Mortgage Loans
missing from the Mortgage Files.
Section
2.4 Custodian
to Cooperate: Release of Mortgage Files.
Upon
receipt of written notice per Exhibit Four or Electronic Release Request
per
Exhibit Five from the Trustee that EMC has repurchased a Mortgage Loan pursuant
to Article II of the Pooling and Servicing Agreement, and a request for release
(a “Request for Release”) confirming that the purchase price therefor has been
paid as required under the Pooling and Servicing Agreement, then the Custodian
agrees to promptly release to EMC the related Mortgage File.
Upon
the
Custodian’s receipt of a Request for Release from the Master Servicer
substantially in the form of Exhibit Four attached hereto or Electronic Release
Request per Exhibit Five, stating that it has received payment in full of
a
Mortgage Loan or that payment in full will be escrowed in a manner customary
for
such purposes, the Custodian agrees promptly to release to the Company or
the
related Servicer, the related Mortgage File. The Depositor shall deliver
to the
Custodian and the Custodian agrees to review in accordance with the provisions
of the Custodial Agreement the Mortgage Note and other documents constituting
the Mortgage File with respect to any Replacement Mortgage Loan.
From
time
to time as is appropriate for the servicing or foreclosure of any Mortgage
Loan,
the Company or the related Servicer, as applicable, shall deliver to the
Custodian a Request for Release per Exhibit Four or Electronic Release Request
per Exhibit Five requesting that possession of all of the Mortgage File be
released to the Company or the related Servicer, as applicable, and certifying
as to the reason for such release. Upon receipt of the foregoing, the Custodian
shall deliver the Mortgage File to the Company or the related Servicer, as
applicable. All Mortgage Files so released to the Company or the related
Servicer, as applicable, shall be held by it in trust for the Trustee for
the
use and benefit of all present and future Certificateholders. The Company
or the
related Servicer, as applicable, shall cause each Mortgage File or any document
therein so released to be returned to the Custodian when the need therefore
by
the Company or the related Servicer, as applicable, no longer exists, unless
(i)
the Mortgage Loan has been liquidated, or (ii) the Mortgage File or such
document has been delivered to an attorney, or to a public trustee or other
public official as required by law, for purposes of initiating or pursuing
legal
action or other proceedings for the foreclosure of the Mortgaged Property
either
judicially or non-judicially, and the Company or the related Servicer, as
applicable, has delivered to the Custodian a certificate of a Servicing Officer
certifying as to the name and address of the Person to which such Mortgage
File
or such document was delivered and the purpose or purposes of such
delivery.
At
any
time that the Company, the Master Servicer or the related Servicer is required
to deliver to the Custodian a Request for Release, the Company, the Master
Servicer or the related Servicer, as applicable, shall deliver two copies
of the
Request for Release if delivered in hard copy or the Company, the Master
Servicer or the related Servicer, as applicable, may furnish such Request
for
Release electronically to the Custodian, in which event the Servicing Officer
or
the Master Servicing Officer, as applicable, transmitting the same shall
be
deemed to have signed the Request for Release. In connection with any Request
for Release of a Mortgage File because of a repurchase of a Mortgage Loan,
such
Request for Release shall be accompanied by an assignment of mortgage, without
recourse, representation or warranty from the Trustee to EMC (unless such
Mortgage Loan is a MOM Loan) and the related Mortgage Note shall be endorsed
without recourse, representation or warranty by the Trustee (unless such
Mortgage Loans is registered on the MERS System) and be returned to EMC.
In
connection with any Request for Release of a Mortgage File because of the
payment in full of a Mortgage Loan, such Request for Release shall be
accompanied by a certificate of satisfaction or other similar instrument
to be
executed by or on behalf of the Trustee and returned to the Company, the
Master
Servicer or the related Servicer, as applicable.
Section
2.5 Assumption
Agreements.
In the
event that any assumption agreement, substitution of liability agreement
or sale
of servicing agreement is entered into with respect to any Mortgage Loan
subject
to this Agreement, the Master Servicer shall enforce any obligation of the
related Servicer, to the extent set forth in the Servicing Agreement or with
respect to EMC as company, the Pooling and Servicing Agreement, to notify
the
Custodian that such assumption or substitution agreement has been completed
by
forwarding to the Custodian the original of such assumption or substitution
agreement, which shall be added to the related Mortgage File and, for all
purposes, shall be considered a part of such Mortgage File to the same extent
as
all other documents and instruments constituting parts thereof.
ARTICLE
III
CONCERNING
THE CUSTODIAN
Section
3.1 Custodian
as Bailee and Agent of the Trustee.
With
respect to each Mortgage Note, Mortgage and other documents constituting
each
Mortgage File which are delivered to the Custodian, the Custodian is exclusively
the bailee and custodial agent of the Trustee and has no instructions to
hold
any Mortgage Note or Mortgage for the benefit of any person other than the
Trustee and the Certificateholders and undertakes to perform such duties
and
only such duties as are specifically set forth in this Agreement. Except
upon
compliance with the provisions of Section 2.4 of this Agreement, no Mortgage
Note, Mortgage or Mortgage File shall be delivered by the Custodian to the
Seller, the Depositor, any Servicer, the Securities Administrator or the
Master
Servicer or otherwise released from the possession of the
Custodian.
Section
3.2 Custodian
May Own Certificates.
The
Custodian in its individual or any other capacity may become the owner or
pledgee of interests in the Mortgage Loans with the same rights it would
have if
it were not Custodian.
Section
3.3 Master
Servicer to Pay Custodian’s Fees and Expenses.
The
Master Servicer covenants and agrees to pay pursuant to a separate fee schedule
to the Custodian from time to time, and the Custodian shall be entitled to,
reasonable compensation for all services rendered by it in the exercise and
performance of any of the powers and duties hereunder of the Custodian, and
the
Master Servicer will pay or reimburse the Custodian (which payment or
reimbursement shall be reimbursed to the Master Servicer pursuant to the
Pooling
and Servicing Agreement) upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Custodian in accordance
with
any of the provisions of this Agreement (including the reasonable compensation
and the expenses and disbursements of its counsel and of all persons not
regularly in its employ), except any such expense, disbursement or advance
as
may arise from its negligence or bad faith.
Section
3.4 Custodian
May Resign; Trustee May Remove Custodian.
The
Custodian may resign from the obligations and duties hereby imposed upon
it as
such obligations and duties relate to its acting as Custodian of the Mortgage
Loans. Upon receiving such written notice of resignation, the Trustee shall
either take custody of the Mortgage Files itself and give prompt written
notice
thereof to the Depositor, the Master Servicer, the Securities Administrator
and
the Custodian, or promptly appoint a successor Custodian by written instrument,
in duplicate, one copy of which instrument shall be delivered to the resigning
Custodian and one copy to the successor Custodian. If the Trustee shall not
have
taken custody of the Mortgage Files and no successor Custodian shall have
been
so appointed and have accepted appointment within 30 days after the giving
of
such written notice of resignation, the resigning Custodian may petition
any
court of competent jurisdiction for the appointment of a successor
Custodian.
The
Trustee may remove the Custodian at any time upon 60 days prior written notice
to the Custodian. In such event, the Trustee shall appoint, or petition a
court
of competent jurisdiction to appoint, a successor Custodian hereunder. Any
successor Custodian shall be a depository institution subject to supervision
or
examination by federal or state authority, shall be able to satisfy the other
requirements contained in Section 3.6 and shall be unaffiliated with the
Master
Servicer, Securities Administrator and the Depositor.
Any
resignation or removal of the Custodian and appointment of a successor Custodian
pursuant to any of the provisions of this Section 3.4 shall become effective
upon acceptance of appointment by the successor Custodian. The Trustee shall
give prompt notice to the Depositor and the Master Servicer of the appointment
of any successor Custodian. Notwithstanding anything to the contrary set
forth
herein, no successor Custodian shall be appointed by the Trustee without
the
prior approval of the Depositor and the Master Servicer.
Section
3.5 Merger
or Consolidation of Custodian.
Any
Person into which the Custodian may be merged or converted or with which
it may
be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Custodian shall be a party, or any Person succeeding
to the business of the Custodian, shall be the successor of the Custodian
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 that such successor is a depository institution
subject to supervision or examination by federal or state authority and is
able
to satisfy the other requirements contained in Section 3.6.
Section
3.6 Representations
of the Custodian.
The
Custodian hereby represents that it is a depository institution subject to
supervision or examination by a federal or state authority, has a combined
capital and surplus of at least $15,000,000 and is qualified to do business
in
the jurisdictions in which it will hold any Mortgage File.
Section
3.7 Limitation
on Liability.
Neither
the Custodian nor any of its directors, officers, agents or employees, shall
be
liable for any action taken or omitted to be taken by it or them hereunder
or in
connection herewith in good faith and believed (which belief may be based
upon
the opinion or advice of counsel selected by it in the exercise of reasonable
care) by it or them to be within the purview of this Agreement, except for
its
or their own negligence, lack of good faith or willful misconduct. The Custodian
and any director, officer, employee or agent of the Custodian 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. In no event shall the
Custodian or its directors, officers, agents and employees be held liable
for
any special, indirect or consequential damages resulting from any action
taken
or omitted to be taken by it or them hereunder or in connection herewith
even if
advised of the possibility of such damages.
Notwithstanding
anything herein to the contrary, the Custodian agrees to indemnify the Trust
Fund and the Trustee and each of their respective officers, directors and
agents
for any and all liabilities, obligations, losses, damages, payments, costs
or
expenses of any kind whatsoever that may be imposed on, incurred by or asserted
against the Trustee or the Trust Fund, due to any negligent performance by
the
Custodian of its duties and responsibilities under this Agreement; provided,
however, that the Custodian shall not be liable to any of the foregoing Persons
for any amount and any portion of any such amount resulting from the willful
misfeasance, bad faith or negligence of such person, or the Custodian’s reliance
on instructions from the Trustee, the Securities Administrator or the Master
Servicer. The provisions of this Section 3.7 shall survive the termination
of
this Custodial Agreement.
LaSalle
Bank National Association, as Custodian and in its individual capacity, and
its
directors, officers, employees and agents shall be entitled to indemnification
and defense from the Trust Fund for any loss, liability or expense incurred
without negligence, willful misconduct, bad faith on their part, arising
out of,
or in connection with, the acceptance or administration of the custodial
arrangement created hereunder, including the costs and expenses of defending
themselves against any claim or liability in connection with the exercise
or
performance of any of their powers or duties hereunder.
Section
3.8 Limitation
of Duties.
The
Custodian in its capacity as such:
(a) in
the
course of its review of the Mortgage Files, shall not be required to make
determinations (1) of a legal nature or (2) as to the authority of any officer
or agent of the Master Servicer, Trustee or other entity who has executed
(or
certified with respect to) any document which is part of the Mortgage File;
(b) shall
have no duties or obligations other than those specifically set forth herein
or
as may subsequently be agreed upon in writing by the parties hereto and shall
use the same degree of care and skill as is reasonably expected of financial
institutions acting in comparable capacities;
(c) will
be
regarded as making no representations and having no responsibilities as to
the
validity, sufficiency, value, genuineness, ownership or transferability of
any
Mortgage Loans and will not be required to and will not make any representations
as to the validity, value or genuineness of the Mortgage Loans;
(d) shall
not
be obligated to take any legal action hereunder which might in its judgment
involve any expense or liability unless it has been furnished with reasonable
indemnity;
(e) may
rely
on and shall be protected in acting upon any certificate, instrument, opinion,
notice, letter, telegram or other document, or any security, delivered to
it and
reasonably believed by it to be genuine and to have been signed by the Master
Servicer, the Securities Administrator or the Trustee;
(f) may
rely
on and shall be protected in acting upon the written instructions of the
Master
Servicer or the Trustee and such employees and representatives of the Master
Servicer, the Securities Administrator and the Trustee, as applicable, may
hereinafter designate in writing;
(g) may
consult counsel satisfactory to it (including counsel for the Trustee or
the
Master Servicer) and the opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered, or
omitted by it hereunder in good faith and in accordance with the opinion
of such
counsel (provided that the fees of such counsel in connection with such
consultation and opinion shall be paid by the Custodian); and
(h) shall
not
be liable for any error of judgment, or for any act done or step taken or
omitted by it, in good faith, or for any mistake of fact or law, or for anything
which it may do or refrain from doing in connection therewith, except in
the
case of a breach of any of the Custodian’s obligations hereunder, negligence or
willful misconduct.
The
Custodian shall be held to the same standard of conduct, and shall be entitled
to the same protections, privileges and immunities as other custodians acting
in
a custodial capacity are generally afforded.
No
covenant or agreement contained herein shall be deemed to be the covenant
or
agreement of any member of the Board of Directors, or any director, officer,
agent, employee or representative of the Trustee, Master Servicer, Securities
Administrator or the Custodian in his or her individual capacity and none
of
such persons shall be subject to any personal liability or accountability
by
reason of the execution of this Agreement, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any assessment
or
penalty, or otherwise.
ARTICLE
IV
COMPLIANCE
WITH REGULATION AB
Section
4.1 Intent
of the Parties; Reasonableness.
The
parties hereto acknowledge and agree that the purpose of this Article IV
is to
facilitate compliance by the Depositor with the provisions of Regulation
AB and
related rules and regulations of the Commission. The Depositor shall not
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 under the Securities Act and the Exchange Act. Each of the parties
hereto 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 mortgage-backed
securities markets, advice of counsel, or otherwise, and agrees to comply
with
requests made by the Depositor in good faith for delivery of information
under
these provisions on the basis of evolving interpretations of Regulation AB.
The
Custodian shall cooperate reasonably with the Depositor to deliver to the
Depositor (including any of its assignees or designees), any and all disclosure,
statements, reports, certifications, records and any other information necessary
in the reasonable, good faith determination of the Depositor to permit the
Depositor to comply with the provisions of Regulation AB.
Section
4.2 Additional
Representations and Warranties of the Custodian.
(a) The
Custodian shall be deemed to represent to the Depositor as of the date hereof
and on each date on which information is provided to the Depositor under
Section
4.3 that, except as disclosed in writing to the Depositor prior to such date:
(i) there are no aspects of its financial condition that could have a material
adverse effect on the performance by it of its Custodian obligations under
this
Agreement or any other Securitization Transaction as to which it is the
custodian; (ii) there are no material legal or governmental proceedings pending
(or known to be contemplated) against it; and (iii) there are no affiliations,
relationships or transactions relating to the Custodian with respect to the
Depositor or any sponsor, issuing entity, servicer, trustee, originator,
significant obligor, enhancement or support provider or other material
transaction party (other than the master servicer and the securities
administrator) (as such terms are used in Regulation AB) relating to the
Securitization Transaction contemplated by the Agreement, as identified by
the
Depositor to the Custodian in writing as of the Closing Date (each, a
“Transaction Party”).
(b) If
so
requested by the Depositor on any date following the Closing Date, the Custodian
shall, within five Business Days following such request, confirm in writing
the
accuracy of the representations and warranties set forth in paragraph (a)
of
this Section or, if any such representation and warranty is not accurate
as of
the date of such confirmation, provide reasonably adequate disclosure of
the
pertinent facts, in writing, to the requesting party. Any such request from
the
Depositor shall not be given more than once each calendar quarter, unless
the
Depositor shall have a reasonable basis for a determination that any of the
representations and warranties may not be accurate.
Section
4.3 Additional
Information to Be Provided by the Custodian.
For so
long as the Trust is subject to the reporting obligations under the Exchange
Act, for the purpose of satisfying the Depositor 's reporting obligation
under
the Exchange Act with respect to any class of publicly offered Certificates,
the
Custodian shall (a) notify the Depositor in writing of any material litigation
or governmental proceedings pending against the Custodian that would be material
to Certificateholders, and (b) provide to the Depositor (and the Securities
Administrator) unless the Custodian and the Securities Administrator are
the
same party a written description of such proceedings. Any notices and
descriptions required under this Section 4.3 shall be given no later than
five
Business Days prior to the Determination Date following the month in which
the
Custodian has knowledge of the occurrence of the relevant event. As of the
date
the Depositor, the Securities Administrator files each Report on Form 10-D
or
Form 10-K with respect to the Certificates, the Custodian will be deemed
to
represent that any information previously provided under this Section 4.3,
if
any, is materially correct and does not have any material omissions unless
the
Custodian has provided an update to such information.
Section
4.4 Report
on Assessment of Compliance and Attestation.
On or
before March 15th of each calendar year that the Trust is subject to the
reporting requirements of the Exchange Act beginning in 2007, the Custodian
shall:
(a) deliver
to the Securities Administrator and the Depositor a report regarding the
Custodian’s assessment of compliance (an “Assessment of Compliance”) with the
Servicing Criteria during the preceding calendar year, as required under
Rules
13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation AB. The
Assessment of Compliance, as set forth in Regulation AB, must contain (i)
a
statement by such officer of its responsibility for assessing compliance
with
the Servicing Criteria applicable to the Custodian, (ii) a statement by such
officer that the Custodian used the Servicing Criteria attached as Exhibit
Six
hereto, and which will also be attached to the Assessment of Compliance,
to
assess compliance with the Servicing Criteria applicable to the Custodian,
(iii)
an assessment by such officer of the Custodian’s compliance with the applicable
Servicing Criteria for the period consisting of the preceding calendar year,
including disclosure of any material instance of noncompliance with respect
thereto during such period, which assessment shall be based on the activities
the Custodian performs with respect to asset-based securities transactions
taken
as a whole involving the Custodian, that are backed by the same asset type
as
the Mortgage Loans, (iv) a statement that a registered public accounting
firm
has issued an attestation report on the Custodian’s Assessment of Compliance for
the period consisting of the preceding calendar year, and (v) a statement
as to
which of the Servicing Criteria, if any, are not applicable to the Custodian,
which statement shall be based on the activities the Custodian performs with
respect to asset-backed securities transactions taken as a whole involving
the
Custodian, that are backed by the same asset type as the Mortgage Loans.
Such
report at a minimum shall address each of the Servicing Criteria specified
on
Exhibit Six hereto which are indicated as applicable to the Custodian;
and
(b) deliver
to the Securities Administrator and the Depositor an Attestation Report (an
“Attestation Report”) by a registered public accounting firm that attests to,
and reports on, the Assessment of Compliance made by the Custodian, as required
by Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122(b) of Regulation
AB, which Attestation Report must be made in accordance with standards for
attestation reports issued or adopted by the Public Company Accounting Oversight
Board.
(c) Notwithstanding
the foregoing, an Assessment of Compliance is not required to be delivered
by
the Custodian unless it is required as part of a Form 10-K with respect to
the
Trust Fund.
Section
4.5 Indemnification;
Remedies.
(a) The
Custodian shall indemnify the Depositor, each affiliate of the Depositor,
the
Securities Administrator, the Master Servicer and each broker dealer acting
as
underwriter, placement agent or initial purchaser of the Certificates or
each
Person who controls any of such parties (within the meaning of Section 15
of the
Securities Act and Section 20 of the Exchange Act); and the respective present
and former directors, officers, employees and agents of each of the foregoing,
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 any failure by the Custodian to deliver any
report
on assessment of compliance or accountants’ attestation when and as required
under this Article IV.
(b) In
the
case of any failure of performance described in clause (ii) of Section 4.5(a),
the Custodian shall promptly reimburse the Depositor for all costs reasonably
incurred by the Depositor in order to obtain the information, report,
certification, accountants’ letter or other material not delivered as required
by the Custodian.
ARTICLE
V
MISCELLANEOUS
PROVISIONS
Section
5.1 Notices. All
notices, requests, consents and demands and other communications required
under
this Agreement or pursuant to any other instrument or document delivered
hereunder shall be in writing and, unless otherwise specifically provided,
may
be delivered personally, by telegram or telex, or by registered or certified
mail, postage prepaid, return receipt requested, at the addresses specified
on
the signature page hereof (unless changed by the particular party whose address
is stated herein by similar notice in writing), in which case the notice
will be
deemed delivered when received.
Section
5.2 Amendments.
No
modification or amendment of or supplement to this Agreement shall be valid
or
effective unless the same is in writing and signed by all parties hereto.
The
Trustee shall give prompt notice to the Custodian of any amendment or supplement
to the Pooling and Servicing Agreement and furnish the Custodian with written
copies thereof.
Section
5.3 GOVERNING
LAW.
THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF
OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
Section
5.4 Recordation
of Agreement.
To the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all the counties
or
other comparable jurisdictions in which any or all of the properties subject
to
the Mortgages are situated, and in any other appropriate public recording
office
or elsewhere, such recordation to be effected by the Depositor and at the
Trust’s expense, but only upon direction accompanied by an Opinion of Counsel
reasonably satisfactory to the Depositor to the effect that the failure to
effect such recordation is likely to materially and adversely affect the
interests of the Certificateholders.
For
the
purpose of facilitating the recordation of this Agreement as herein provided
and
for other purposes, this Agreement may be executed simultaneously in any
number
of counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same
instrument.
Section
5.5 Severability
of Provisions. If
any one or more of the covenants, agreements, provisions or terms of this
Agreement shall be for any reason whatsoever held invalid, 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
or of the Certificates or the rights of the holders thereof.
[Signature
Page Attached]
IN
WITNESS WHEREOF, this Agreement is executed as of the date first above
written.
|
Address:
000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
SACO I Trust, Series 2006-9
Telecopy:
(000) 000-0000
|
CITIBANK,
N.A., not individually but solely as Trustee
By:__________________________________
Name:
Title:
|
|
Address:
000
Xxxxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
|
BEAR
XXXXXXX ASSET BACKED SECURITIES I LLC
By:__________________________________
Name:
Title:
|
|
Address:
0000
Xxxx Xxxxx Xxxxx
Xxxxxxxxxx,
Xxxxx 00000
(Facsimile:
(000) 000-0000)
Attention:
President or General Counsel
|
EMC
MORTGAGE CORPORATION
By:__________________________________
Name:
Title:
|
|
Address:
0000
Xxxxx Xx., Xxxxx 000
Xxx
Xxxxx Xxxxxxx, Xxxxxxxx 00000
|
LASALLE
BANK NATIONAL ASSOCIATION,
as Custodian
By:__________________________________
Name:
Title:
|
|
Address:
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
|
LASALLE
BANK NATIONAL ASSOCIATION, as Master Servicer and Securities
Administrator
By:__________________________________
Name:
Title:
|
|
STATE
OF NEW YORK
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared _________________ known to me to be a(n) __________________of Citibank,
N.A., one of the parties that executed the within agreement, and also known
to
me to be the person who executed the within agreement on behalf of said party
and acknowledged to me that such party executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[SEAL]
|
STATE
OF NEW YORK
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared ____________, known to me to be a _________________ of Bear Xxxxxxx
Asset Backed Securities I LLC, and also known to me to be the person who
executed the within instrument on behalf of said party, and acknowledged
to me
that such party executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[SEAL]
|
)
|
||
|
)
|
ss.:
|
|
|
COUNTY
OF DALLAS
|
)
|
On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared ____________________, known to me to be a(n)
_____________________ of EMC Mortgage Corporation, one of the parties that
executed the within instrument, and also known to me to be the person who
executed the within instrument on behalf of said party, and acknowledged
to me
that such party executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[Notarial
Seal]
|
STATE
OF ILLINOIS
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF___________
|
)
|
On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared ___________________, known to me to be a(n) __________________ of
LaSalle Bank National Association, one of the parties that executed the within
instrument, and also known to me to be the person who executed it on behalf
of
said party, and acknowledged to me that such party executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[Notarial
Seal]
|
STATE
OF ILLINOIS
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF___________
|
)
|
On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared _______________, known to me to be an _______________ of LaSalle
Bank
National Association, one of the parties that executed the within instrument,
and also known to me to be the person who executed it on behalf of said party,
and acknowledged to me that such party executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[Notarial
Seal]
SCHEDULE
A
MORTGAGE
LOAN SCHEDULE
(Provided
upon request)
EXHIBIT
ONE
FORM
OF
CUSTODIAN INITIAL CERTIFICATION
August
30,
2006
Citibank,
N.A.
000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Structured Finance - SACO I Trust, Series 2006-9
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000X
Attn:
Global Securities and Trust Services - SACO I Trust 2006-9
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
XX 00000
Attention:
SACO I Inc., Series 2006-9
|
Re:
|
Custodial
Agreement, dated as of August 30, 2006, by and among Citibank,
N.A.,
LaSalle Bank National Association, Bear Xxxxxxx Asset Backed Securities
I
LLC and EMC Mortgage Corporation relating to SACO I Trust 2006-9,
Mortgage-Backed Certificates, Series
2006-9
|
Ladies
and Gentlemen:
In
accordance with Section 2.3(a) of the above-captioned Custodial Agreement,
the
undersigned, as Custodian, hereby certifies that it has received the following
documents with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule, with any exceptions listed on Schedule A attached hereto: (i) an
original note, including any riders thereto, endorsed without recourse to
the
order of blank or to “Citibank, N.A., as Trustee for certificateholders of SACO
I Trust 2006-9, Mortgage Pass-Through Certificates, Series 2006-9 under the
Pooling and Servicing Agreement dated as of August 1, 2006 for SACO I Trust
2006-9 Mortgage Pass-Through Certificates, Series 2006-9,” and showing an
unbroken chain of endorsements from the original payee thereof to the person
endorsing it to the Trustee; (ii) an original mortgage and, if the related
mortgage loan is a MERS Loan, registered with MERS, noting the presence of
the
mortgage identification number and language indicating that such mortgage
loan
is a MERS Loan, which shall have been recorded (or, for Mortgage Loans other
than the EMC Flow Loans, if the original is not available, a copy) with evidence
of such recording indicated thereon (or if clause (x) in the proviso below
applies, shall be in recordable form); (iii) unless the mortgage loan is
a MERS
Loan, the assignment (either an original or a copy, which may be in the form
of
a blanket assignment if permitted in the jurisdiction in which the mortgage
property is located) to the Trustee of the mortgage with respect to each
mortgage loan in the name of ___________________________, which shall have
been
recorded (of if clause (x) in the proviso below applies, shall be in recordable
form); (iv) an original or a copy of all intervening assignments of the
mortgage, if any, with evidence of recording thereon; (v) the original policy
of
title insurance or mortgagee’s certificate of title insurance or commitment or
binder for title insurance, if available, or a copy thereof, or, in the event
that such original title insurance policy is unavailable, a photocopy thereof,
or in lieu thereof, a current lien search on the related mortgaged property;
and
(vi) originals or copies of all available assumption, modification or
substitution agreements, if any; provided, however, that in lieu of the
foregoing, the Seller may deliver the following documents, under the
circumstances set forth below: (x) if any mortgage (other than the mortgages
related to the EMC Flow Loans), assignment thereof to the Trustee or intervening
assignments thereof have been delivered or are being delivered to recording
offices for recording and have not been returned in time to permit their
delivery as specified above, the Depositor may deliver a true copy thereof
with
a certification by the Seller or the title company issuing the commitment
for
title insurance, on the face of such copy, substantially as follows: “Certified
to be a true and correct copy of the original, which has been transmitted
for
recording”; and (y) in lieu of the mortgage notes relating to the Mortgage Loans
identified in the list attached hereto, the Depositor may deliver a lost
note
affidavit and indemnity and a copy of the original note, if
available.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the above-captioned Custodial Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION, as Custodian
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
SCHEDULE
A
(PROVIDED
UPON REQUEST)
EXHIBIT
TWO
FORM
OF
CUSTODIAN INTERIM CERTIFICATION
[DATE]
Citibank,
N.A.
000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Structured Finance - SACO I Trust, Series 2006-9
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Attn:
Global Securities and Trust Services - SACO I Trust 2006-9
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
XX 00000
Attention:
SACO I Inc., Series 2006-9
|
Re:
|
Custodial
Agreement, dated as of August 30, 2006, by and among Citibank,
N.A.,
LaSalle Bank National Association, Bear Xxxxxxx Asset Backed Securities
I
LLC and EMC Mortgage Corporation relating to SACO I Trust 2006-9,
Mortgage-Backed Certificates, Series
2006-9
|
Ladies
and Gentlemen:
In
accordance with Section 2.3(b) of the above-captioned Custodial Agreement,
the
undersigned, as Custodian, hereby certifies that it has received and reviewed
the documents described in its initial certification dated August 30, 2006
and
has determined that: all documents have been executed and received and that
such
documents relate to the Mortgage Loans identified on the Mortgage Loan Schedule,
with any exceptions listed on Schedule A attached hereto.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the above-captioned Custodial Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION, as Custodian
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
SCHEDULE
A
(PROVIDED
UPON REQUEST)
EXHIBIT
THREE
FORM
OF
CUSTODIAN FINAL CERTIFICATION
[DATE]
Citibank,
N.A.
000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Structured Finance - SACO I Trust, Series 2006-9
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Attn:
Global Securities and Trust Services - SACO I Trust 2006-9
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
XX 00000
Attention:
SACO I Inc., Series 2006-9
|
Re:
|
Custodial
Agreement, dated as of August 30, 2006, by and among Citibank,
N.A.,
LaSalle Bank National Association, Bear Xxxxxxx Asset Backed Securities
I
LLC and EMC Mortgage Corporation relating to SACO I Trust 2006-9,
Mortgage-Backed Certificates, Series
2006-9
|
Ladies
and Gentlemen:
In
accordance with Section 2.3(c) of the above-captioned Custodial Agreement,
the
undersigned, as Custodian, hereby certifies that it has received and reviewed
the documents described in its initial certification dated August 30, 2006
and
has determined that: all documents have been executed and received and that
such
documents relate to the Mortgage Loans identified on the Mortgage Loan Schedule,
with any exceptions listed on Schedule A attached hereto.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the above-captioned Custodial Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION, as Custodian
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
SCHEDULE
A
(PROVIDED
UPON REQUEST)
EXHIBIT
FOUR
FORM
OF
REQUEST FOR RELEASE OF DOCUMENTS AND RECEIPT
To: [Name/Address
of Owner]
Attention:
|
Re:
|
Custodial
Agreement, dated as of August 30, 2006, by and among Citibank,
N.A.,
LaSalle Bank National Association, Bear Xxxxxxx Asset Backed Securities
I
LLC and EMC Mortgage Corporation relating to SACO I Trust 2006-9,
Mortgage-Backed Certificates, Series
2006-9
|
In
connection with the Mortgage Files that you hold pursuant to the Custodial
Agreement, we request the release, and acknowledge receipt of the Mortgage
file/[specify document] for the Mortgage Loan described below, the reason
indicated.
Mortgagor’s
Name, Address and Zip Code:
Mortgage
Loan Number:
Reason
for Requesting Documents: (check one)
_____
1.
Mortgage Loan paid in full. ([The Master Servicer] [A Servicer] [the Trustee]
hereby certifies that all amounts received in connection therewith have been
credited to
__________________________________________________________________________.)
_____
2.
Mortgage Loan in foreclosure.
_____
3.
Repurchase. (The [Master Servicer] [Trustee] hereby certifies that the
repurchase price has been credited to
_____________________________________________.)
_____
4.
Mortgage Loan liquidated by _______________________________________. ([The
Master Servicer] [A Servicer] [The Trustee] hereby certifies that all proceeds
of the foreclosure, insurance, condemnation or other liquidation have been
finally received and credited to
_____________________________________.
_____
5.
Other (explain):
|
By:
|
||
|
(authorized
signer)
|
||
|
Issuer:
|
||
|
Address:
|
||
|
Date:
|
||
EXHIBIT
FIVE
ELECTRONIC
RELEASE REQUEST (Excel)
|
Collateral
Release Tasks
|
|
|
|
|
|
Required
Field Header
|
Description
|
|
|
|
|
customer
|
Value
can be constant of '1018'
|
|
|
|
|
poolnum
|
pool
number if available, can be left blank as well
|
|
|
|
|
loanid
|
EMC
loan#, required field
|
|
|
|
|
loc_code
|
Codes
must be mutually agreed upon with custodian. Examples are PDPO=
loans
released for payoff, FORC = loans released for foreclosure, OLIQ=
loans
released for repurchase, NLIQ = loans released for
non-liquidation/correction.
|
|
|
|
|
rel_code
|
Codes
must be mutually agreed upon with custodian. Examples are
1
=
payoff, 2 = foreclosure, 4 = repurchase, 5 =
non-liquidation.
|
|
|
|
|
rel_doclist
|
Can
be left blank
|
|
|
|
|
notation
|
“Name
of Person File Being Released To @ Company Name” (i.e. Xxxxxx
Xxxxx@EMC)
|
|
|
|
|
reqstr
|
Can
be left blank
|
|
|
|
|
reqstr_sig
|
Signatory
code assigned to requestor, TBD
|
|
|
|
|
amend
|
0
=
new release request, 1= amend an existing released record (i.e.
FORC to
PDPO)
|
EXHIBIT
SIX
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by the Custodian shall address,
at a
minimum, the criteria identified below as “Applicable Servicing
Criteria”:
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
General
Servicing Considerations
|
||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements
|
|
|
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 pool assets 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 pool assets 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.
|
|
|
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 institutions” 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
reconciliations; 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 pool assets serviced by the
servicer.
|
|
|
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 pool assets is maintained as required by the transaction
agreements or related asset pool documents.
|
√
|
|
1122(d)(4)(ii)
|
Pool
assets 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
|
√1
|
|
1122(d)(4)(iv)
|
Payments
on pool assets, including any payoffs, made in accordance with
the related
pool asset 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 pool asset documents.
|
|
|
1122(d)(4)(v)
|
The
servicer’s records regarding the pool assets 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 pool asset (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.
|
|
|
1122(d)(4)(vii)
|
Loss
mitigation of recovery actions (e.g., forbearance plans, modifications
and
deed 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
documents.
|
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period
a pool
asset is delinquent in accordance with the transaction agreements.,
Such
records are maintained in at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent pool assets 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 pool assets with variable
rates
are computed based on the related pool asset 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 pool asset 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 pool asset documents
and state
laws; and (C) such funds are returned to the obligor within 3-
calendar
days of full repayment of the related pool asset, or such other
number of
days specified in the transaction agreements.
|
|
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax ore 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 service at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
|
|
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.
|
|
|
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.
|
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible funds are recognized and recorded
in
accordance with the transaction agreements.
|
|
|
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.
|
|
1
Only
with respect to the logistics of adding, removing or substituting loan
files.
EXHIBIT
K
FORM
OF
XXXXX FARGO CUSTODIAL AGREEMENT
THIS
CUSTODIAL AGREEMENT (as amended and supplemented from time to time, the
“Agreement”), dated as of August 30, 2006, by and among CITIBANK, N.A., not
individually but solely as trustee under the Pooling and Servicing Agreement
defined below (in such capacity, including its successors under the Pooling
and
Servicing Agreement defined below, the “Trustee”), BEAR XXXXXXX ASSET BACKED
SECURITIES I LLC, as depositor (together with any successor in interest,
the
“Depositor”), EMC MORTGAGE CORPORATION as seller (in such capacity, “EMC” or the
“Seller”) and as company (together with any successor in interest or successor
under the Pooling and Servicing Agreement referred to below, the “Company”),
LASALLE
BANK NATIONAL ASSOCIATION, as master servicer (together
with any successor in interest or successor under the Pooling and Servicing
Agreement referred to below, the “Master Servicer”) and securities administrator
(together with any successor in interest or successor under the Pooling and
Servicing Agreement referred to below, the “Securities Administrator”) and XXXXX
FARGO BANK, N.A., as custodian (together with any successor in interest or
any
successor appointed hereunder, the “Custodian”).
WITNESSETH
THAT:
WHEREAS,
the Depositor, EMC, the Master Servicer, the Securities Administrator and
the
Trustee have entered into a Pooling and Servicing Agreement, dated as of
August
1, 2006, relating to the issuance of SACO I Trust 2006-9, Mortgage-Backed
Certificates, Series 2006-9 (as in effect on the date of this Agreement,
and as
amended and supplemented from time to time, the “Pooling and Servicing
Agreement”) and all custodian obligations are defined herein. In the event any
custodian obligations are defined in the Pooling and Servicing Agreement,
this
custodial agreement shall supercede.
WHEREAS,
the Custodian has agreed to act as agent for the Trustee on behalf of the
Certificateholders for the purposes of receiving and holding certain documents
and other instruments delivered by the Depositor, the Seller or the Master
Servicer under the Pooling and Servicing Agreement and the Servicers under
their
respective Servicing Agreements, all upon the terms and conditions and subject
to the limitations hereinafter set forth. In the event any custodian terms,
conditions and obligations are defined in the Pooling and Servicing Agreement,
this custodial agreement shall supercede;
NOW,
THEREFORE, in consideration of the premises and the mutual covenants and
agreements hereinafter set forth, the Trustee, the Depositor, the Seller,
the
Master Servicer, the Company and the Custodian hereby agree as
follows:
ARTICLE
I
DEFINITIONS
Capitalized
terms used in this Agreement and not defined herein shall have the meanings
assigned in the Pooling and Servicing Agreement, unless otherwise required
by
the context herein.
ARTICLE
II
CUSTODY
OF MORTGAGE DOCUMENTS
Section
2.1 Custodian
to Act as Agent: Acceptance of Mortgage Files.
The
Custodian, as the duly appointed custodial agent of the Trustee for these
purposes, acknowledges (subject to any exceptions noted in the Initial
Certification referred to in Section 2.3(a)) receipt of the Mortgage Files
relating to the Mortgage Loans identified on the schedule attached hereto
(the
“Mortgage Files”) and declares that it holds and will hold such Mortgage Files
as agent for the Trustee, in trust, for the use and benefit of all present
and
future Certificateholders.
Section
2.2 Recordation
of Assignments.
If any
Mortgage File includes one or more assignments of Mortgage that have not
been
recorded pursuant to the provisions of Section 2.01 of the Pooling and Servicing
Agreement and the related Mortgage Loan is not a MOM Loan or the related
Mortgaged Properties are located in jurisdictions specifically excluded by
the
Opinion of Counsel delivered to the Trustee pursuant to Section 2.01 of the
Pooling and Servicing Agreement, each such assignment shall be delivered
by the
Custodian to the related Seller for the purpose of recording it in the
appropriate public office for real property records, and the Sellers, at
no
expense to the Custodian, shall promptly cause to be recorded in the appropriate
public office for real property records each such assignment of Mortgage
and,
upon receipt thereof from such public office, shall return each such assignment
of Mortgage to the Custodian.
Section
2.3 Review
of Mortgage Files.
(a) On
or
prior to the Closing Date, in accordance with Section 2.02 of the Pooling
and
Servicing Agreement, the Custodian shall deliver to EMC, the Master Servicer
and
the Trustee an Initial Certification in the form annexed hereto as Exhibit
One
evidencing receipt (subject to any exceptions noted therein) of a Mortgage
File
for each of the Mortgage Loans listed on Schedule A attached hereto (the
“Mortgage Loan Schedule”).
(b) Within
90
days of the Closing Date, the Custodian agrees, for the benefit of
Certificateholders, to review, in accordance with the provisions of Section
2.02
of the Pooling and Servicing Agreement, each such document, and shall deliver
to
EMC, the Master Servicer and the Trustee an Interim Certification in the
form
annexed hereto as Exhibit Two to the effect that all such documents have
been
executed and received and that such documents relate to the Mortgage Loans
identified on the Mortgage Loan Schedule, except for any exceptions listed
on
Schedule A attached to such Interim Certification. The Custodian shall be
under
no duty or obligation to inspect, review or examine said documents, instruments,
certificates or other papers to determine that the same are genuine,
enforceable, or appropriate for the represented purpose or that they have
actually been recorded or that they are other than what they purport to be
on
their face.
(c) Not
later
than 180 days after the Closing Date, the Custodian shall review, for the
benefit of Certificateholders, the Mortgage Files as provided in Section
2.02 of
the Pooling and Servicing Agreement and deliver to the Seller, the Master
Servicer and the Trustee a Final Certification in the form annexed hereto
as
Exhibit Three evidencing the completeness of the Mortgage Files.
(d) In
reviewing the Mortgage Files as provided herein and in the Pooling and Servicing
Agreement, the Custodian shall make no representation as to and shall not
be
responsible to verify (i) the validity, legality, enforceability, due
authorization, recordability, sufficiency or genuineness of any of the documents
included in any Mortgage File or (ii) the collectability, insurability,
effectiveness or suitability of any of the documents in any Mortgage
File.
Upon
receipt of written request from EMC, the Master Servicer or the Trustee,
the
Custodian shall as soon as practicable supply such Person with a list of
all of
the documents relating to the Mortgage Loans missing from the Mortgage
Files.
Section
2.4 Notification
of Breaches of Representations and Warranties.
Upon
discovery by the Custodian of a breach of any representation or warranty
made by
the Depositor as set forth in the Pooling and Servicing Agreement with respect
to a Mortgage Loan relating to a Mortgage File, the Custodian shall give
prompt
written notice to the Depositor, the Master Servicer and the
Trustee.
Section
2.5 Custodian
to Cooperate: Release of Mortgage Files.
Upon
receipt of written notice from the Master Servicer or Trustee that EMC has
repurchased one or more Mortgage Loans pursuant to Article II of the Pooling
and
Servicing Agreement, and a request for release (a “Request for Release”)
confirming that the purchase price therefor has been deposited in the Master
Servicer Collection Account or the Distribution Account, then the Custodian
agrees to promptly release to EMC the related Mortgage Files.
Upon
the
Custodian’s receipt of a Request for Release substantially in the form of
Exhibit G to the Pooling and Servicing Agreement signed by a Servicing Officer
of a Servicer, stating that it has received payment in full of a Mortgage
Loan
or that payment in full will be escrowed in a manner customary for such
purposes, the Custodian agrees promptly to release to such Servicer, the
related
Mortgage File. The Depositor shall deliver to the Custodian and the Custodian
agrees to review in accordance with the provisions of this Agreement the
Mortgage Note and other documents constituting the Mortgage File with respect
to
any Replacement Mortgage Loan.
From
time
to time as is appropriate for the servicing or foreclosure of any Mortgage
Loan,
including, for this purpose, the Company or the related Servicer, as applicable,
shall deliver to the Custodian a Request for Release signed by a Servicing
Officer requesting that possession of all of the Mortgage File be released
to
the Company or the related Servicer, as applicable, and certifying as to
the
reason for such release and that such release will not invalidate any insurance
coverage provided in respect of the Mortgage Loan. Upon receipt of the
foregoing, the Custodian shall deliver the Mortgage File to the Company or
the
related Servicer, as applicable. All Mortgage Files so released to the Company
or the related Servicer, as applicable, shall be held by it in trust for
the
Trustee for the use and benefit of all present and future Certificateholders.
The Company or the related Servicer, as applicable, shall cause each Mortgage
File or any document therein so released to be returned to the Custodian
when
the need therefore by the Company or the related Servicer, as applicable,
no
longer exists, unless (i) the Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been deposited in
the
Master Servicer Collection Account or the Distribution Account or (ii) the
Mortgage File or such document has been delivered to an attorney, or to a
public
trustee or other public official as required by law, for purposes of initiating
or pursuing legal action or other proceedings for the foreclosure of the
Mortgaged Property either judicially or non-judicially, and the Company or
the
related Servicer, as applicable, has delivered to the Custodian a certificate
of
a Servicing Officer certifying as to the name and address of the Person to
which
such Mortgage File or such document was delivered and the purpose or purposes
of
such delivery.
At
any
time that the Company or the related Servicer is required to deliver to the
Custodian a Request for Release, the Company or the related Servicer, as
applicable, shall deliver two copies of the Request for Release if delivered
in
hard copy or the Company or the related Servicer, as applicable, may furnish
such Request for Release electronically to the Custodian, in which event
the
Servicing Officer transmitting the same shall be deemed to have signed the
Request for Release. In connection with any Request for Release of a Mortgage
File because of a repurchase of a Mortgage Loan, such Request for Release
shall
be accompanied by an assignment of mortgage, without recourse, representation
or
warranty from the Trustee to EMC (unless such Mortgage Loan is a MOM Loan)
and
the related Mortgage Note shall be endorsed without recourse, representation
or
warranty by the Trustee and be returned to EMC; provided, however, that in
the
case of a Mortgage Loan that is registered on the MERS System, no assignment
of
mortgage or endorsement of the Mortgage Note by the Trustee shall be required.
In connection with any Request for Release of a Mortgage File because of
the
payment in full of a Mortgage Loan, such Request for Release shall be
accompanied by a certificate of satisfaction or other similar instrument
to be
executed by or on behalf of the Trustee and returned to the Company or the
related Servicer, as applicable.
Section
2.6 Assumption
Agreements.
In the
event that any assumption agreement, substitution of liability agreement
or sale
of servicing agreement is entered into with respect to any Mortgage Loan
subject
to this Agreement in accordance with the terms and provisions of the Pooling
and
Servicing Agreement, the Master Servicer shall enforce any obligation of
the
related Servicer under the related Servicing Agreement, or in the case of
EMC as
company, the Pooling and Servicing Agreement, to notify the Custodian that
such
assumption or substitution agreement has been completed by forwarding to
the
Custodian the original of such assumption or substitution agreement, which
shall
be added to the related Mortgage File and, for all purposes, shall be considered
a part of such Mortgage File to the same extent as all other documents and
instruments constituting parts thereof.
ARTICLE
III
CONCERNING
THE CUSTODIAN
Section
3.1 Custodian
as Bailee and Agent of the Trustee.
With
respect to each Mortgage Note, Mortgage and other documents constituting
each
Mortgage File which are delivered to the Custodian, the Custodian is exclusively
the bailee and custodial agent of the Trustee and has no instructions to
hold
any Mortgage Note or Mortgage for the benefit of any person other than the
Trustee and the Certificateholders and undertakes to perform such duties
and
only such duties as are specifically set forth in this Agreement and in the
Pooling and Servicing Agreement. Except upon compliance with the provisions
of
Section 2.5 of this Agreement, no Mortgage Note, Mortgage or Mortgage File
shall
be delivered by the Custodian to the Company, the Depositor, any Servicer,
the
Securities Administrator or the Master Servicer or otherwise released from
the
possession of the Custodian.
Section
3.2 Custodian
May Own Certificates.
The
Custodian and its affiliates in their individual or any other capacity may
become the owner or pledgee of Certificates with the same rights such persons
would have if the Custodian were not Custodian hereunder.
Section
3.3 Custodian’s
Fees and Expenses.
The
Master Servicer covenants and agrees to pay to the Custodian from time to
time a
fee as agreed upon by such parties as reasonable compensation for all services
rendered by it in the exercise and performance of any of the powers and duties
hereunder of the Custodian. Upon its request, the Custodian shall be paid
or
reimbursed from the Trust Fund for all reasonable expenses, disbursements
and
advances incurred or made by the Custodian in accordance with any of the
provisions of this Agreement (including the reasonable compensation and the
expenses and disbursements of its legal counsel and of all persons not regularly
in its employ), except any such expense, disbursement or advance as may arise
from the Custodian’s negligence or bad faith or to the extent that such cost or
expense is indemnified by the Depositor pursuant to the Pooling and Servicing
Agreement.
Section
3.4 Custodian
May Resign; Trustee May Remove Custodian.
The
Custodian may resign from the obligations and duties hereby imposed upon
it as
such obligations and duties relate to its acting as Custodian of the Mortgage
Loans hereunder. Upon receiving such written notice of resignation, the Trustee
shall either take custody of the Mortgage Files itself and give prompt written
notice thereof to the Depositor, the Master Servicer and the Custodian, or
promptly appoint a successor Custodian by written instrument, in duplicate,
one
copy of which instrument shall be delivered to the resigning Custodian and
one
copy to the successor Custodian. If the Trustee shall not have taken custody
of
the Mortgage Files and no successor Custodian shall have been so appointed
and
have accepted appointment within 30 days after the giving of such written
notice
of resignation, the resigning Custodian may petition any court of competent
jurisdiction for the appointment of a successor Custodian.
The
Trustee, at the direction of 25% of the Certificateholders, shall remove
the
Custodian at any time upon 60 days prior written notice to Custodian. In
such
event, the Trustee shall appoint, or petition a court of competent jurisdiction
to appoint, a successor Custodian hereunder. Any successor Custodian shall
be a
depository institution subject to supervision or examination by federal or
state
authority shall be able to satisfy the other requirements contained in Section
3.6 and shall be unaffiliated with the Master Servicer, the Company and the
Depositor.
Any
resignation or removal of the Custodian and appointment of a successor Custodian
pursuant to any of the provisions of this Section 3.4 shall become effective
upon acceptance of appointment by the successor Custodian. The Trustee shall
give prompt notice to the Depositor and the Master Servicer of the appointment
of any successor Custodian. Notwithstanding anything to the contrary set
forth
herein, no successor Custodian shall be appointed by the Trustee without
the
prior approval of the Depositor and the Master Servicer.
Section
3.5 Merger
or Consolidation of Custodian.
Any
Person into which the Custodian may be merged or converted or with which
it may
be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Custodian shall be a party, or any Person succeeding
to the business of the Custodian (by sale of assets, stock or a combination
of
both), shall be the successor of the Custodian 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 that such
successor is a depository institution subject to supervision or examination
by
federal or state authority and is able to satisfy the other requirements
contained in Section 3.6.
Section
3.6 Representations
of the Custodian.
The
Custodian hereby represents that it is a depository institution subject to
supervision or examination by a federal or state authority, has a combined
capital and surplus of at least $15,000,000 and is qualified to do business
in
the jurisdictions in which it will hold any Mortgage File.
Section
3.7 Limitation
on Liability.
Neither
the Custodian nor any of its directors, officers, agents or employees, shall
be
liable for any action taken or omitted to be taken by it or them hereunder
or in
connection herewith in good faith and believed (which belief may be based
upon
the opinion or advice of counsel selected by it in the exercise of reasonable
care) by it or them to be within the purview of this Agreement, except for
its
or their own negligence, bad faith or willful misconduct. The Custodian and
any
director, officer, employee or agent of the Custodian 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. In no event shall the Custodian
or its directors, officers, agents and employees be held liable for any special,
indirect or consequential damages (“Special Damages”) resulting from any action
taken or omitted to be taken by it or them hereunder or in connection herewith
even if advised of the possibility of such damages.
Notwithstanding
anything herein to the contrary, the Custodian agrees to indemnify the Trust
Fund and the Trustee and each of their respective officers, directors and
agents
for any and all liabilities, obligations, losses, damages, payments, costs
or
expenses of any kind whatsoever (except Special Damages) that may be imposed
on,
incurred by or asserted against the Trustee or the Trust Fund, due to any
act or
omission by the Custodian with respect to the Mortgage Files; provided, however,
that the Custodian shall not be liable to any of the foregoing Persons for
any
amount and any portion of any such amount resulting from the willful
misfeasance, bad faith or negligence of such Person. The provisions of this
Section 3.7 shall survive the termination of this Custodial
Agreement.
The
Custodian and its directors, officers, employees and agents shall be entitled
to
indemnification and defense from the Trust Fund for any loss, liability damages,
payments, costs or expense incurred without negligence, willful misconduct,
bad
faith on their part, arising out of, or in connection with, the acceptance
or
administration of the custodial arrangement created hereunder, including
without
limitation the costs and expenses of defending themselves against any claim
or
liability in connection with the exercise or performance of any of their
powers
or duties hereunder.
ARTICLE
IV
COMPLIANCE
WITH REGULATION AB
Section
4.1 Intent
of the Parties; Reasonableness.
The
parties hereto acknowledge and agree that the purpose of this Article IV
is to
facilitate compliance by the Depositor with the provisions of Regulation
AB and
related rules and regulations of the Commission. The Depositor shall not
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 under the Securities Act and the Exchange Act. Each of the parties
hereto 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 mortgage-backed
securities markets, advice of counsel, or otherwise, and agrees to comply
with
requests made by the Depositor in good faith for delivery of information
under
these provisions on the basis of evolving interpretations of Regulation AB.
The
Custodian shall cooperate reasonably with the Depositor to deliver to the
Depositor (including any of its assignees or designees), any and all disclosure,
statements, reports, certifications, records and any other information necessary
in the reasonable, good faith determination of the Depositor to permit the
Depositor to comply with the provisions of Regulation AB.
Section
4.2 Additional
Representations and Warranties of the Custodian.
(a) The
Custodian hereby represents and warrants that the information set forth in
the
Prospectus Supplement under the caption “Description of the Certificates - The
Custodians” (the “Custodian Disclosure”) does not contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the light
of
the circumstances under which they were made, not misleading.
(e) The
Custodian shall be deemed to represent to the Depositor as of the date hereof
and on each date on which information is provided to the Depositor under
Section
4.3 that, except as disclosed in writing to the Depositor prior to such date:
(i) there are no aspects of its financial condition that could have a material
adverse effect on the performance by it of its Custodian obligations under
this
Agreement or any other Securitization Transaction as to which it is the
custodian; (ii) there are no material legal or governmental proceedings pending
(or known to be contemplated) against it; and (iii) there are no affiliations,
relationships or transactions relating to the Custodian with respect to the
Depositor or any sponsor, issuing entity, servicer, trustee, originator,
significant obligor, enhancement or support provider or other material
transaction party (as such terms are used in Regulation AB) relating to the
Securitization Transaction contemplated by the Agreement, as identified by
the
Depositor to the Custodian in writing as of the Closing Date (each, a
“Transaction Party”).
(f) If
so
requested by the Depositor on any date following the Closing Date, the Custodian
shall, within five Business Days following such request, confirm in writing
the
accuracy of the representations and warranties set forth in paragraph (a)
of
this Section or, if any such representation and warranty is not accurate
as of
the date of such confirmation, provide reasonably adequate disclosure of
the
pertinent facts, in writing, to the requesting party. Any such request from
the
Depositor shall not be given more than once each calendar quarter, unless
the
Depositor shall have a reasonable basis for a determination that any of the
representations and warranties may not be accurate.
Section
4.3 Additional
Information to Be Provided by the Custodian.
For so
long as the Certificates are outstanding, for the purpose of satisfying the
Depositor's reporting obligation under the Exchange Act with respect to any
class of Certificates, the Custodian shall (a) notify the Depositor in writing
of any material litigation or governmental proceedings pending against the
Custodian that would be material to Certificateholders, and (b) provide to
the
Depositor a written description of such proceedings. Any notices and
descriptions required under this Section 4.3 shall be given no later than
five
Business Days prior to the Determination Date following the month in which
the
Custodian has knowledge of the occurrence of the relevant event. As of the
date
the Depositor, the Securities Administrator or Master Servicer files each
Report
on Form 10-D or Form 10-K with respect to the Certificates, the Custodian
will
be deemed to represent that any information previously provided under this
Section 4.3, if any, is materially correct and does not have any material
omissions unless the Custodian has provided an update to such
information.
Section
4.4 Report
on Assessment of Compliance and Attestation.
On or
before March 15th of each calendar year, the Custodian shall:
(a) deliver
to Securities Administrator and the Depositor a report regarding the Custodian’s
assessment of compliance (an “Assessment of Compliance”) with the Servicing
Criteria during the preceding calendar year, as required under Rules 13a-18
and
15d-18 of the Exchange Act and Item 1122 of Regulation AB. The Assessment
of
Compliance, as set forth in Regulation AB, must contain (i) a statement by
such
officer of its responsibility for assessing compliance with the Servicing
Criteria applicable to the Custodian, (ii) a statement by such officer that
the
Custodian used the Servicing Criteria attached as Exhibit Four hereto, and
which
will also be attached to the Assessment of Compliance, to assess compliance
with
the Servicing Criteria applicable to the Custodian, (iii) an assessment by
such
officer of the Custodian’s compliance with the applicable Servicing Criteria for
the period consisting of the preceding calendar year, including disclosure
of
any material instance of noncompliance with respect thereto during such period,
which assessment shall be based on the activities the Custodian performs
with
respect to asset-based securities transactions taken as a whole involving
the
Custodian, that are backed by the same asset type as the Mortgage Loans,
(iv) a
statement that a registered public accounting firm has issued an attestation
report on the Custodian’s Assessment of Compliance for the period consisting of
the preceding calendar year, and (v) a statement as to which of the Servicing
Criteria, if any, are not applicable to the Custodian, which statement shall
be
based on the activities the Custodian performs with respect to asset-backed
securities transactions taken as a whole involving the Custodian, that are
backed by the same asset type as the Mortgage Loans. Such report at a minimum
shall address each of the Servicing Criteria specified on Exhibit Four hereto
which are indicated as applicable to the Custodian; and
(b) deliver
to the Securities Administrator and the Depositor an Attestation Report (an
“Attestation Report”) by a registered public accounting firm that attests to,
and reports on, the Assessment of Compliance made by the Custodian, as required
by Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122(b) of Regulation
AB, which Attestation Report must be made in accordance with standards for
attestation reports issued or adopted by the Public Company Accounting Oversight
Board.
(c) Notwithstanding
the foregoing, an Assessment of Compliance is not required to be delivered
by
the Custodian unless it is required as part of a Form 10-K with respect to
the
Trust Fund.
Section
4.5 Indemnification;
Remedies.
(a) The
Custodian shall indemnify the Depositor, each affiliate of the Depositor,
the
Securities Administrator, the Master Servicer and each broker dealer acting
as
underwriter, placement agent or initial purchaser of the Certificates or
each
Person who controls any of such parties (within the meaning of Section 15
of the
Securities Act and Section 20 of the Exchange Act); and the respective present
and former directors, officers, employees and agents of each of the foregoing,
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 the
Custodian Disclosure and any information, report, certification, accountants’
attestation or other material provided under this Article IV by or on behalf
of
the Custodian (collectively, the “Custodian Information”), or (B) the omission
or alleged omission to state in the Custodian Information a material fact
required to be stated in the Custodian Information or necessary in order
to make
the statements therein, in the light of the circumstances under which they
were
made, not misleading; or
(ii) any
failure by the Custodian to deliver any information, report, certification,
accountants’ attestation or other material when and as required under this
Article IV.
(b) In
the
case of any failure of performance described in clause (ii) of Section 4.5(a),
the Custodian shall promptly reimburse the Depositor for all costs reasonably
incurred by the Depositor in order to obtain the information, report,
certification, accountants’ letter or other material not delivered as required
by the Custodian.
ARTICLE
V
MISCELLANEOUS
PROVISIONS
Section
5.1 Notices.
All
notices, requests, consents and demands and other communications required
under
this Agreement or pursuant to any other instrument or document delivered
hereunder shall be in writing and, unless otherwise specifically provided,
may
be delivered personally, by telegram or telex, or by registered or certified
mail, postage prepaid, return receipt requested, at the addresses specified
on
the signature page hereof (unless changed by the particular party whose address
is stated herein by similar notice in writing), in which case the notice
will be
deemed delivered when received.
Section
5.2 Amendments.
No
modification or amendment of or supplement to this Agreement shall be valid
or
effective unless the same is in writing and signed by all parties hereto.
The
Trustee shall give prompt notice to the Custodian of any amendment or supplement
to the Pooling and Servicing Agreement and furnish the Custodian with written
copies thereof.
Section
5.3 GOVERNING
LAW.
THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF
OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
Section
5.4 Recordation
of Agreement.
To the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all the counties
or
other comparable jurisdictions in which any or all of the properties subject
to
the Mortgages are situated, and in any other appropriate public recording
office
or elsewhere, such recordation to be effected by the Depositor and at the
Trust’s expense, but only upon direction accompanied by an Opinion of Counsel
reasonably satisfactory to the Depositor to the effect that the failure to
effect such recordation is likely to materially and adversely affect the
interests of the Certificateholders.
For
the
purpose of facilitating the recordation of this Agreement as herein provided
and
for other purposes, this Agreement may be executed simultaneously in any
number
of counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same
instrument.
Section
5.5 Severability
of Provisions.
If any
one or more of the covenants, agreements, provisions or terms of this Agreement
shall be for any reason whatsoever held invalid, 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
or of the Certificates or the rights of the holders thereof.
[Signature
Page Follows]
IN
WITNESS WHEREOF, this Agreement is executed as of the date first above
written.
|
Address:
000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
SACO I Trust, Series 2006-9
Telecopy
(000) 000-0000
|
CITIBANK,
N.A., as Trustee
By:__________________________________
Name:
Title:
|
|
Address:
000
Xxxxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
|
BEAR
XXXXXXX ASSET BACKED SECURITIES I LLC
By:__________________________________
Name:
Title:
|
|
Address:
0000
Xxxx Xxxxx Xxxxx
Xxxxxxxxxx,
Xxxxx 00000
(Facsimile:
(000) 000-0000)
Attention:
President or General Counsel
|
EMC
MORTGAGE CORPORATION
By:__________________________________
Name:
Title:
|
|
Address:
0000
00xx Xxxxxx Xxxxxxxxx, XX 0031
Xxxxxxxxxxx,
XX 00000
Attention:
SACO I 2006-9
|
XXXXX
FARGO BANK, N.A., as Custodian
By:__________________________________
Name:
Title:
|
|
Address:
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
XX 00000
|
LASALLE
BANK NATIONAL ASSOCIATION, as Master Servicer and Securities
Administrator
By:__________________________________
Name:
Title:
|
|
STATE
OF NEW YORK
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared _________________ known to me to be a(n) __________________of Citibank,
N.A., one of the parties that executed the within agreement, and also known
to
me to be the person who executed the within agreement on behalf of said party
and acknowledged to me that such party executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[SEAL]
|
STATE
OF NEW YORK
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF NEW YORK
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)
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On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared _____________, known to me to be a _________________ of Bear Xxxxxxx
Asset Backed Securities I LLC, and also known to me to be the person who
executed the within instrument on behalf of said party, and acknowledged
to me
that such party executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[SEAL]
|
STATE
OF TEXAS
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)
|
|
|
)
|
ss.:
|
|
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COUNTY
OF DALLAS
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)
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On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared _______________________, known to me to be a(n) __________________
of
EMC Mortgage Corporation, one of the parties that executed the within
instrument, and also known to me to be the person who executed the within
instrument on behalf of said party, and acknowledged to me that such party
executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[SEAL]
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STATE
OF MINNESOTA
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)
|
|
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)
|
ss.:
|
|
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COUNTY
OF HENNEPIN
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)
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On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared _________________ known to me to be a(n) __________________of Xxxxx
Fargo Bank, N.A., one of the parties that executed the within agreement,
and
also known to me to be the person who executed the within agreement on behalf
of
said party and acknowledged to me that such party executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[SEAL]
|
STATE
OF ILLINOIS
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)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF___________
|
)
|
On
the
30th
day of
August 2006 before me, a notary public in and for said State, personally
appeared ____________________ known to me to be a(n) ____________________of
LaSalle Bank National Association, one of the parties that executed the within
agreement, and also known to me to be the person who executed the within
agreement on behalf of said party and acknowledged to me that such party
executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
|
Notary
Public
|
[SEAL]
SCHEDULE
A
MORTGAGE
LOAN SCHEDULE
(Provided
upon request)
EXHIBIT
ONE
FORM
OF
CUSTODIAN INITIAL CERTIFICATION
August
30,
2006
Citibank,
N.A.
000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Structured Finance - SACO I Trust, Series 2006-9
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Attn:
Global Securities and Trust Services - SACO I Trust 2006-9
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
XX 00000
(Facsimile:
(000) 000-0000)
Attention:
President or General Counsel
Attention:
SACO I Inc., Series 2006-9
|
Re:
|
Custodial
Agreement, dated as of August 30, 2006, by and among Bear Xxxxxxx
Asset
Backed Securities I LLC, EMC Mortgage Corporation, Citibank, N.A.,
LaSalle
Bank National Association and Xxxxx Fargo Bank, N.A. relating to
SACO I
Trust 2006-9, Mortgage-Backed Certificates, Series 2006-9
|
Ladies
and Gentlemen:
In
accordance with Section 2.3(a) of the above-captioned Custodial Agreement,
and
subject to Section 2.02(a) of the Pooling and Servicing Agreement, the
undersigned, as Custodian, hereby certifies that it has received a Mortgage
File
(which contains an original Mortgage Note or lost note affidavit) to the
extent
required in Section 2.01 of the Pooling and Servicing Agreement with respect
to
each Mortgage Loan listed in the Mortgage Loan Schedule, with any exceptions
listed on Schedule A attached hereto.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the above-captioned Custodial Agreement.
|
XXXXX
FARGO BANK, N.A.
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
SCHEDULE
A
(PROVIDED
UPON REQUEST)
EXHIBIT
TWO
FORM
OF
CUSTODIAN INTERIM CERTIFICATION
[DATE]
Citibank,
N.A.
000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Structured Finance - SACO I Trust, Series 2006-9
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Attn:
Global Securities and Trust Services - SACO I Trust 2006-9
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
XX 00000
(Facsimile:
(000) 000-0000)
Attention:
President or General Counsel
Attention:
SACO I Inc., Series 2006-9
|
Re:
|
Custodial
Agreement, dated as of August 30, 2006, by and among Bear Xxxxxxx
Asset
Backed Securities I LLC, EMC Mortgage Corporation, Citibank, N.A.,
LaSalle
Bank National Association and Xxxxx Fargo Bank, N.A. relating to
SACO I
Trust 2006-9, Mortgage-Backed Certificates, Series 2006-9
|
Ladies
and Gentlemen:
In
accordance with Section 2.3(b) of the above-captioned Custodial Agreement
and
subject to Section 2.02(a) of the Pooling and Servicing Agreement, the
undersigned, as Custodian, hereby certifies that it has received a Mortgage
File
to the extent required pursuant to Section 2.01 of the Pooling and Servicing
Agreement with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule, and it has reviewed the Mortgage File and the Mortgage Loan Schedule
and has determined that: all required documents have been executed and received
and that such documents relate to the Mortgage Loans identified on the Mortgage
Loan Schedule, with any exceptions listed on Schedule A attached
hereto.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the above-captioned Custodial Agreement.
|
XXXXX
FARGO BANK, N.A.
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
SCHEDULE
A
(PROVIDED
UPON REQUEST)
EXHIBIT
THREE
FORM
OF
CUSTODIAN FINAL CERTIFICATION
[DATE]
Citibank,
N.A.
000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Structured Finance - SACO I Trust, Series 2006-9
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Attn:
Global Securities and Trust Services - SACO I Trust 2006-9
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
XX 00000
(Facsimile:
(000) 000-0000)
Attention:
President or General Counsel
Attention:
SACO I Inc., Series 2006-9
|
Re:
|
Custodial
Agreement, dated as of August 30, 2006, by and among Bear Xxxxxxx
Asset
Backed Securities I LLC, EMC Mortgage Corporation, Citibank, N.A.,
LaSalle
Bank National Association and Xxxxx Fargo Bank, N.A. relating to
SACO I
Trust 2006-9, Mortgage-Backed Certificates, Series
2006-9
|
Ladies
and Gentlemen:
In
accordance with Section 2.3(c) of the above-captioned Custodial
Agreement
and,
subject to Section 2.02(a) of the Pooling and Servicing Agreement, the
undersigned, as Custodian, hereby certifies that it has received a Mortgage
File
to the extent required pursuant to Section 2.01 of the Pooling and Servicing
Agreement with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule, and it has reviewed the Mortgage File and the Mortgage Loan Schedule
and has determined that: all required documents have been executed and received
and that such documents relate to the Mortgage Loans identified on the Mortgage
Loan Schedule, with any exceptions listed on Schedule A attached
hereto.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the above-captioned Custodial Agreement or in the Pooling and Servicing
Agreement, as applicable.
|
XXXXX
FARGO BANK, N.A.
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
SCHEDULE
A
(PROVIDED
UPON REQUEST)
EXHIBIT
FOUR
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by the Custodian shall address,
at a
minimum, the criteria identified below as “Applicable Servicing
Criteria”:
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
General
Servicing Considerations
|
||
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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
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|
|
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 pool assets 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 pool assets 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.
|
|
|
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.
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|
|
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 institutions” 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.
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|
|
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
reconciliations; 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 pool assets serviced by the
servicer.
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|
|
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 pool assets is maintained as required by the transaction
agreements or related asset pool documents.
|
√
|
|
1122(d)(4)(ii)
|
Pool
assets 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 pool assets, including any payoffs, made in accordance with
the related
pool asset 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 pool asset documents.
|
|
|
1122(d)(4)(v)
|
The
servicer’s records regarding the pool assets 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 pool asset (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.
|
|
|
1122(d)(4)(vii)
|
Loss
mitigation of recovery actions (e.g., forbearance plans, modifications
and
deed 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
documents.
|
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period
a pool
asset is delinquent in accordance with the transaction agreements.,
Such
records are maintained in at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent pool assets 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 pool assets with variable
rates
are computed based on the related pool asset 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 pool asset 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 pool asset documents
and state
laws; and (C) such funds are returned to the obligor within 3-
calendar
days of full repayment of the related pool asset, or such other
number of
days specified in the transaction agreements.
|
|
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax ore 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 service at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
|
|
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.
|
|
|
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.
|
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible funds are recognized and recorded
in
accordance with the transaction agreements.
|
|
|
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.
|
|
EXHIBIT
L
FORM
OF
MORTGAGE LOAN PURCHASE AGREEMENT
MORTGAGE
LOAN PURCHASE AGREEMENT, dated as of August 30, 2006, as amended and
supplemented by any and all amendments hereto (collectively, “this
Agreement”),
by
and between EMC MORTGAGE CORPORATION, a Delaware corporation (the “Mortgage Loan
Seller”) and BEAR XXXXXXX ASSET BACKED SECURITIES I LLC, a Delaware limited
liability company (the “Purchaser”).
Upon
the
terms and subject to the conditions of this Agreement, the Mortgage Loan
Seller
agrees to sell, and the Purchaser agrees to purchase, certain conventional,
closed-end, fixed rate junior-lien mortgage loans secured by one- to four-family
residences (collectively, the “Mortgage
Loans”)
as
described herein. The Purchaser intends to deposit the Mortgage Loans into
a
trust fund (the “Trust
Fund”)
and
create SACO I Trust 2006-9, Mortgage-Backed Certificates, Series 2006-9 (the
“Certificates”),
under
a pooling and servicing agreement, to be dated as of August 1, 2006 (the
“Pooling
and Servicing Agreement”),
among
the Purchaser, as depositor, EMC, as seller and as company, LaSalle Bank
National Association, as master servicer (in that capacity, the “Master
Servicer”)
and
securities administrator (in that capacity, the “Securities Administrator”) and
Citibank, N.A., as trustee (the “Trustee”).
The
Purchaser has filed with the Securities and Exchange Commission (the
“Commission”)
a
registration statement on Form S-3 (Number 333-131374) relating to its
Mortgage-Backed Certificates and the offering of certain series thereof
(including certain classes of the Certificates) from time to time in accordance
with Rule 415 under the Securities Act of 1933, as amended, and the rules
and
regulations of the Commission promulgated thereunder (the “Securities
Act”).
Such
registration statement, when it became effective under the Securities Act,
and
the prospectus relating to the public offering of certain classes of the
Certificates by the Purchaser (the “Public
Offering”),
as
each may be amended or supplemented from time to time pursuant to the Securities
Act or otherwise, are referred to herein as the “Registration
Statement”
and
the
“Prospectus,”
respectively. The “Free
Writing Prospectus”
shall
mean the free writing prospectus, dated August 10, 2006. The
“Prospectus
Supplement”
shall mean that supplement, dated August [__], 2006 to the Prospectus, dated
June 7, 2006, relating to certain classes of Certificates. With
respect to the Public Offering of certain classes of the Certificates, Bear,
Xxxxxxx & Co. Inc. (“Bear
Xxxxxxx”)
and the
Purchaser have entered into a terms agreement, dated as of August 10, 2006,
to
an underwriting agreement, dated April 13, 2006 (together, the “Underwriting
Agreement”)
between
Bear Xxxxxxx and the Purchaser.
Now,
therefore, in consideration of the premises and the mutual agreements set
forth
herein, the parties hereto agree as follows:
SECTION
1. Definitions.
Certain
terms are defined herein. Capitalized terms used herein but not defined herein
shall have the meanings specified in the Pooling and Servicing Agreement.
The
following other terms are defined as follows:
Acquisition
Price:
With
respect to the Mortgage Loan Seller and the sale of the Mortgage Loans, cash
in
an amount equal to $ *
(plus
$ *
in
accrued interest) and the retained certificates.
Bear
Xxxxxxx:
Bear,
Xxxxxxx & Co. Inc.
Closing
Date:
August
30, 2006.
Custodial
Agreement:
Any of
the LaSalle Custodial Agreement or Xxxxx Fargo Custodial Agreement.
Custodian:
Any of
LaSalle, as custodian under the LaSalle Custodial Agreement or Xxxxx Fargo,
as
custodian under the Xxxxx Fargo Custodial Agreement.
Cut-off
Date:
August
1, 2006.
Cut-off
Date Balance:
Shall
mean $[__________].
Deleted
Mortgage Loan:
A
Mortgage Loan replaced or to be replaced by a Replacement Mortgage
Loan.
Due
Date:
As to
any Mortgage Loan, the date in each month on which the related Scheduled
Payment
is due, as set forth in the related Mortgage Note.
EMC:
EMC
Mortgage Corporation.
EMC
Flow Loans:
The
Mortgage Loans purchased by EMC pursuant to a flow loan purchase
agreement.
LaSalle:
LaSalle
Bank National Association, or its successors in interest.
LaSalle
Custodial Agreement:
The
custodial agreement, dated as of August 30, 2006, among the Depositor, the
Mortgage Loan Seller, the Master Servicer and the Securities Administrator,
the
Trustee and LaSalle Bank National Association as Custodian relating to the
Mortgage Loans identified in such custodial agreement.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS®
System:
The
system of recording transfers of Mortgages electronically maintained by
MERS.
Moody’s:
Xxxxx’x
Investors Service, Inc., or its successors in interest.
Mortgage:
The
mortgage or deed of trust or other instrument creating a first or junior
lien on
an interest in an estate in fee simple in real property securing a Mortgage
Note.
* Please
contact Bear Xxxxxxx for pricing information.
Mortgage
File:
The
items referred to in Exhibit
1
pertaining to a particular Mortgage Loan and any additional documents required
to be added to such documents pursuant to this Agreement.
Mortgage
Rate:
The
annual rate of interest borne by a Mortgage Note as stated herein.
Mortgagor:
The
obligor(s) on a Mortgage Note.
Net
Mortgage Rate:
As to
each Mortgage Loan, and at any time, the per annum rate equal to the Mortgage
Rate less the sum of (i) the Servicing Fee Rate, (ii) the Trustee Fee Rate
and
(iii) the rate at which the LPMI Fee is calculated, if any.
Opinion
of Counsel:
A
written opinion of counsel, who may be counsel for the Mortgage Loan Seller
or
the Purchaser, reasonably acceptable to the Trustee.
Person:
Any
legal person, including any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
Purchase
Price:
With
respect to any Mortgage Loan required to be purchased by the Mortgage Loan
Seller pursuant to the applicable provisions of this Agreement, an amount
equal
to the sum of (i) 100% of the principal remaining unpaid on such Mortgage
Loan
as of the date of purchase (including if a foreclosure has already occurred,
the
principal balance of the related Mortgage Loan at the time the Mortgaged
Property was acquired), (ii) accrued and unpaid interest thereon at the Mortgage
Rate through and including the last day of the month of purchase and (iii)
any
costs and damages (if any) incurred by the Trust in connection with any
violation of such Mortgage Loan of any anti-predatory lending laws.
Rating
Agencies:
Moody’s
and Standard & Poor’s, each a “Rating Agency”.
Replacement
Mortgage Loan:
A
mortgage loan substituted for a Deleted Mortgage Loan which must meet on
the
date of such substitution the requirements stated herein and in the Pooling
and
Servicing Agreement; upon such substitution, such mortgage loan shall be
a
“Mortgage Loan” hereunder.
Securities
Act:
The
Securities Act of 1933, as amended.
Standard
& Poor’s:
Standard & Poor’s, a division of The XxXxxx-Xxxx Companies, Inc. or its
successors in interest.
Value:
The
value of the Mortgaged Property at the time of origination of the related
Mortgage Loan, such value being the lesser of (i) the value of such property
set
forth in an appraisal accepted by the applicable originator of the Mortgage
Loan
or (ii) the sales price of such property at the time of
origination.
Xxxxx
Fargo:
Xxxxx
Fargo Bank, National Association, or its successor in interest.
Xxxxx
Fargo Custodial Agreement:
The
custodial agreement, dated as of August 30, 2006, among the Depositor, the
Mortgage Loan Seller, the Master Servicer and Securities Administrator, the
Trustee and Xxxxx Fargo Bank, National Association as Custodian relating
to the
Mortgage Loans identified in such custodial agreement.
SECTION
2. Purchase
and Sale of the Mortgage Loans and Related Rights.
(a) Upon
satisfaction of the conditions set forth in Section 10 hereof, the Mortgage
Loan
Seller agrees to sell, and the Purchaser agrees to purchase Mortgage Loans sold
by the Mortgage Loan Seller having an aggregate outstanding principal balance
as
of the Cut-off Date equal to the Cut-off Date Balance.
(b) The
closing for the purchase and sale of the Mortgage Loans and the closing for
the
issuance of the Certificates will take place on the Closing Date at the office
of the Purchaser’s counsel in New York, New York or such other place as the
parties shall agree.
(c) Upon
the
satisfaction of the conditions set forth in Section 10 ereof, on the Closing
Date, the Purchaser shall pay to the Mortgage Loan Seller the Acquisition
Price
for the Mortgage Loans sold by the Mortgage Loan Seller in immediately available
funds by wire transfer to such account or accounts as shall be designated
by the
Mortgage Loan Seller.
SECTION
3. Mortgage
Loan Schedules.
The
Mortgage Loan Seller agrees to provide to the Purchaser as of the date hereof
a
preliminary listing of the Mortgage Loans (the “Preliminary
Mortgage Loan Schedule”)
setting forth the information listed on Exhibit 2 to this Agreement with
respect
to each of the Mortgage Loans being sold by the Mortgage Loan Seller. If
there
are changes to the Preliminary Mortgage Loan Schedule, the Mortgage Loan
Seller
shall provide to the Purchaser as of the Closing Date a final schedule (the
“Final
Mortgage Loan Schedule”)
setting forth the information listed on Exhibit
2
to this
Agreement with respect to each of the Mortgage Loans being sold by the Mortgage
Loan Seller to the Purchaser. The Final Mortgage Loan Schedule shall be
delivered to the Purchaser on the Closing Date, shall be attached to an
amendment to this Agreement to be executed on the Closing Date by the parties
hereto and shall be in form and substance mutually agreed to by the Mortgage
Loan Seller and the Purchaser (the “Amendment”).
If
there are no changes to the Preliminary Mortgage Loan Schedule, the Preliminary
Mortgage Loan Schedule shall be the Final Mortgage Loan Schedule for all
purposes hereof.
SECTION
4. Mortgage
Loan Transfer.
(a) The
Purchaser will be entitled to all scheduled payments of principal and interest
on the Mortgage Loans due after the Cut-off Date (regardless of when actually
collected) and all payments thereof. The Mortgage Loan Seller will be entitled
to all scheduled payments of principal and interest on the Mortgage Loans
sold
by it to the Purchaser due on or before the Cut-off Date (including payments
collected after the Cut-off Date) and all payments thereof. Such principal
amounts and any interest thereon belonging to the Mortgage Loan Seller as
described above will not be included in the aggregate outstanding principal
balance of the Mortgage Loans as of the Cut-off Date as set forth on the
Final
Mortgage Loan Schedule.
(b) Pursuant
to various conveyancing documents to be executed on the Closing Date and
pursuant to the Pooling and Servicing Agreement, the Purchaser will assign
on
the Closing Date all of its right, title and interest in and to the Mortgage
Loans to the Trustee for the benefit of the Certificateholders. In connection
with the transfer and assignment of the Mortgage Loans, the Mortgage Loan
Seller
has delivered or will deliver or cause to be delivered to the Trustee, or
the
Custodian on behalf of the Trustee, by the Closing Date or such later date
as is
agreed to by the Purchaser and the Mortgage Loan Seller (each of the Closing
Date and such later date is referred to as a “Mortgage
File Delivery Date”),
the
items of the respective Custodian’s Mortgage File, provided,
however,
that in
lieu of the foregoing, the Mortgage Loan Seller may deliver the following
documents, under the circumstances set forth below: (x) in lieu of the original
Mortgage (other than the Mortgages related to the EMC Flow Loans), assignments
to the Trustee or intervening assignments thereof which have been delivered,
are
being delivered or will upon receipt of recording information relating to
the
Mortgage required to be included thereon, be delivered to recording offices
for
recording and have not been returned in time to permit their delivery as
specified above, the Mortgage Loan Seller may deliver a true copy thereof
with a
certification by the Mortgage Loan Seller or the Master Servicer, on the
face of
such copy, substantially as follows: “Certified to be a true and correct copy of
the original, which has been transmitted for recording;” (y) in lieu of the
Mortgage (other than the Mortgages related to the EMC Flow Loans), assignments
to the Trustee or intervening assignments thereof, if the applicable
jurisdiction retains the originals of such documents or if the originals
are
lost (in each case, as evidenced by a certification from the Mortgage Loan
Seller or the Master Servicer to such effect), the Mortgage Loan Seller may
deliver photocopies of such documents containing an original certification
by
the judicial or other governmental authority of the jurisdiction where such
documents were recorded; and (z) in lieu of the Mortgage Notes relating to
the
Mortgage Loans, each identified in the list delivered by the Purchaser to
the
Trustee on the Closing Date and attached hereto as Exhibit
5
the
Mortgage Loan Seller may deliver lost note affidavits and indemnities of
the
Mortgage Loan Seller; and provided further, however, that in the case of
Mortgage Loans which have been prepaid in full after the Cut-off Date and
prior
to the Closing Date, the Mortgage Loan Seller, in lieu of delivering the
above
documents, may deliver to the Trustee a certification by the Mortgage Loan
Seller or the Master Servicer to such effect. The Mortgage Loan Seller shall
deliver such original documents (including any original documents as to which
certified copies had previously been delivered) or such certified copies
to the
Trustee, or the related Custodian on behalf of the Trustee, promptly after
they
are received. The Mortgage Loan Seller shall cause the Mortgage and intervening
assignments, if any, and the assignment of the Mortgage to be recorded not
later
than 180 days after the Closing Date unless such assignment is not required
to
be recorded under the terms set forth in Section 6(a) hereof.
(c) In
connection with the assignment of any Mortgage Loan registered on the MERS®
System, the Mortgage Loan Seller further agrees that it will cause, at the
Mortgage Loan Seller’s own expense, within 30 days after the Closing Date, the
MERS® System to indicate that such Mortgage Loans have been assigned by the
Mortgage Loan Seller to the Purchaser and by the Purchaser to the Trustee
in
accordance with this Agreement for the benefit of the Certificateholders
by
including (or deleting, in the case of Mortgage Loans which are repurchased
in
accordance with this Agreement) in such computer files (a) the code in the
field
which identifies the specific Trustee and (b) the code in the field “Pool Field”
which identifies the series of the Certificates issued in connection with
such
Mortgage Loans. The Mortgage Loan Seller further agrees that it will not,
and
will not permit the Master Servicer or related Servicer to, alter the codes
referenced in this paragraph with respect to any Mortgage Loan during the
term
of the Pooling and Servicing Agreement unless and until such Mortgage Loan
is
repurchased in accordance with the terms of the Pooling and Servicing
Agreement.
(d) The
Mortgage Loan Seller and the Purchaser acknowledge hereunder that all of
the
Mortgage Loans will ultimately be assigned to Citibank, N.A., as Trustee
for the
benefit of the Certificateholders, on the date hereof.
SECTION
5. Examination
of Mortgage Files.
(a) On
or
before the Mortgage File Delivery Date, the Mortgage Loan Seller will have
made
the Mortgage Files available to the Purchaser or its agent for examination
which
may be at the offices of the Trustee or the Mortgage Loan Seller and/or the
Mortgage Loan Seller’s custodian. The fact that the Purchaser or its agent has
conducted or has failed to conduct any partial or complete examination of
the
Mortgage Files shall not affect the Purchaser’s rights to demand cure,
repurchase, substitution or other relief as provided in this Agreement. In
furtherance of the foregoing, the Mortgage Loan Seller shall make the Mortgage
Files available to the Purchaser or its agent from time to time so as to
permit
the Purchaser to confirm the Mortgage Loan Seller’s compliance with the delivery
and recordation requirements of this Agreement and the Pooling and Servicing
Agreement. In addition, upon request of the Purchaser, the Mortgage Loan
Seller
agrees to provide to the Purchaser, Bear Xxxxxxx and to any investors or
prospective investors in the Certificates information regarding the Mortgage
Loans and their servicing, to make the Mortgage Files available to the
Purchaser, Bear Xxxxxxx and to such investors or prospective investors (which
may be at the offices of the related Mortgage Loan Seller and/or the Mortgage
Loan Seller’s custodian) and to make available personnel knowledgeable about the
Mortgage Loans for discussions with the Purchaser, Bear Xxxxxxx and such
investors or prospective investors, upon reasonable request during regular
business hours, sufficient to permit the Purchaser, Bear Xxxxxxx and such
investors or potential investors to conduct such due diligence as any such
party
reasonably believes is appropriate.
(b) Pursuant
to the Pooling and Servicing Agreement, on the Closing Date the Trustee (or
the
Custodian as obligated under the applicable Custodial Agreement), for the
benefit of the Certificateholders, will review items of the Mortgage Files
as
set forth on Exhibit
1
and will
deliver to the Mortgage Loan Seller an initial certification in the form
attached as Exhibit One to the applicable Custodial Agreement.
(c) Within
90
days of the Closing Date, the Trustee or the related Custodian on its behalf
shall, in accordance with the provisions of Section 2.02 of the Pooling and
Servicing Agreement, deliver to the Mortgage Loan Seller and the Trustee
an
Interim Certification in the form attached as Exhibit Two to the applicable
Custodial Agreement to the effect that all such documents have been executed
and
received and that such documents relate to the Mortgage Loans identified
on the
Mortgage Loan Schedule, except for any exceptions listed on Schedule A attached
to such Interim Certification. The related Custodian shall be under no duty
or
obligation to inspect, review or examine said documents, instruments,
certificates or other papers to determine that the same are genuine,
enforceable, or appropriate for the represented purpose or that they have
actually been recorded or that they are other than what they purport to be
on
their face.
(d) The
Trustee or the related Custodian on its behalf will review the Mortgage Files
within 180 days of the Closing Date and will deliver to the Mortgage Loan
Seller
and the Master Servicer, and if reviewed by the related Custodian, the Trustee,
a final certification substantially in the form of Exhibit 3 to the applicable
Custodial Agreement. If the Trustee or the related Custodian on its behalf
is
unable to deliver a final certification with respect to the items listed
in
Exhibit
1
due to
any document that is missing, has not been executed, is unrelated, determined
on
the basis of the Mortgagor name, original principal balance and loan number,
to
the Mortgage Loans identified in the Final Mortgage Loan Schedule (a
“Material
Defect”),
the
Trustee or the related Custodian on its behalf shall notify the Mortgage
Loan
Seller of such Material Defect. The Mortgage Loan Seller shall correct or
cure
any such Material Defect within 90 days from the date of notice from the
Trustee, the Depositor or the Master Servicer of the Material Defect and
if the
Mortgage Loan Seller does not correct or cure such Material Defect within
such
period and such defect materially and adversely affects the interests of
the
Certificateholders in the related Mortgage Loan, the Mortgage Loan Seller
will,
in accordance with the terms of the Pooling and Servicing Agreement, within
90
days of the date of notice, provide the Trustee with a Replacement Mortgage
Loan
(if within two years of the Closing Date) or purchase the related Mortgage
Loan
at the applicable Purchase Price; provided,
however,
that if
such defect relates solely to the inability of the Mortgage Loan Seller to
deliver the original security instrument or intervening assignments thereof,
or
a certified copy because the originals of such documents, or a certified
copy,
have not been returned by the applicable jurisdiction, the Mortgage Loan
Seller
shall not be required to purchase such Mortgage Loan if the Mortgage Loan
Seller
delivers such original documents or certified copy promptly upon receipt,
but in
no event later than 360 days after the Closing Date. The foregoing repurchase
obligation shall not apply in the event that the Mortgage Loan Seller cannot
deliver such original or copy of any document submitted for recording to
the
appropriate recording office in the applicable jurisdiction because such
document has not been returned by such office; provided that the Mortgage
Loan
Seller shall instead deliver a recording receipt of such recording office
or, if
such receipt is not available, a certificate of the Mortgage Loan Seller
or a
Servicing Officer confirming that such documents have been accepted for
recording, and delivery to the Trustee shall be effected by the Mortgage
Loan
Seller within thirty days of its receipt of the original recorded
document.
(e) At
the
time of any substitution, the Mortgage Loan Seller shall deliver or cause
to be
delivered the Replacement Mortgage Loan, the related Mortgage File and any
other
documents and payments required to be delivered in connection with a
substitution pursuant to the Pooling and Servicing Agreement. At the time
of any
purchase or substitution, the Trustee shall (i) assign the selected Mortgage
Loan to the Mortgage Loan Seller and shall release or cause the related
Custodian to release the documents (including, but not limited to, the Mortgage,
Mortgage Note and other contents of the Mortgage File) in the possession
of the
Trustee or the related Custodian, as applicable relating to the Deleted Mortgage
Loan and (ii) execute and deliver such instruments of transfer or assignment,
in
each case without recourse, as shall be necessary to vest in the Mortgage
Loan
Seller title to such Deleted Mortgage Loan.
SECTION
6. Recordation
of Assignments of Mortgage.
(a) The
Mortgage Loan Seller will, promptly after the Closing Date, cause each Mortgage
and each assignment of Mortgage from the Mortgage Loan Seller to the Trustee,
and all unrecorded intervening assignments, if any, delivered on or prior
to the
Closing Date, to be recorded in all recording offices in the jurisdictions
where
the related Mortgaged Properties are located; provided,
however,
the
Mortgage Loan Seller need not cause to be recorded any assignment which relates
to a Mortgage Loan that is a MOM Loan or for which the related Mortgaged
Property is located in any jurisdiction under the laws of which, as evidenced
by
an Opinion of Counsel delivered by the Mortgage Loan Seller to the Trustee
and
the Rating Agencies, the recordation of such assignment is not necessary
to
protect the Trustee’s interest in the related Mortgage Loan; provided,
however,
notwithstanding the delivery of any Opinion of Counsel, each assignment of
Mortgage shall be submitted for recording by the Mortgage Loan Seller in
the
manner described above, at no expense to the Trust Fund or Trustee, upon
the
earliest to occur of (i) reasonable direction by the Holders of Certificates
evidencing Percentage Interests aggregating not less than 25% of the Trust,
(ii)
the occurrence of an Event of Default, (iii) the occurrence of a bankruptcy,
insolvency or foreclosure relating to the Mortgage Loan Seller under the
Pooling
and Servicing Agreement, (iv) the occurrence of a servicing transfer or an
assignment of the servicing as described in Section 8.05(b) of the Pooling
and
Servicing Agreement or (iv) with respect to any one assignment of Mortgage,
the
occurrence of a bankruptcy, insolvency or foreclosure relating to the Mortgagor
under the related Mortgage.
While
each such Mortgage or assignment is being recorded, if necessary, the Mortgage
Loan Seller shall leave or cause to be left with the Trustee or the related
Custodian on its behalf a certified copy of such Mortgage or assignment.
In the
event that, within 180 days of the Closing Date, the Trustee has not been
provided with an Opinion of Counsel as described above or received evidence
of
recording with respect to each Mortgage Loan delivered to the Purchaser pursuant
to the terms hereof or as set forth above and the related Mortgage Loan is
not a
MOM Loan, the failure to provide evidence of recording or such Opinion of
Counsel shall be considered a Material Defect, and the provisions of Section
5(c) and (d) shall apply. All customary recording fees and reasonable expenses
relating to the recordation of the assignments of mortgage to the Trustee
or the
Opinion of Counsel, as the case may be, shall be borne by the Mortgage Loan
Seller.
(b) It
is the
express intent of the parties hereto that the conveyance of the Mortgage
Loans
by the Mortgage Loan Seller to the Purchaser, as contemplated by this Agreement
be, and be treated as, a sale. It is, further, not the intention of the parties
that such conveyance be deemed a pledge of the Mortgage Loans by the Mortgage
Loan Seller to the Purchaser to secure a debt or other obligation of the
Mortgage Loan Seller. However, in the event that, notwithstanding the intent
of
the parties, the Mortgage Loans are held by a court to continue to be property
of the Mortgage Loan Seller, then (a) this Agreement shall also be deemed
to be
a security agreement within the meaning of Articles 8 and 9 of the applicable
Uniform Commercial Code; (b) the transfer of the Mortgage Loans provided
for
herein shall be deemed to be a grant by the Mortgage Loan Seller to the
Purchaser of a security interest in all of the Mortgage Loan Seller’s right,
title and interest in and to the Mortgage Loans and all amounts payable to
the
holders of the Mortgage Loans in accordance with the terms thereof and all
proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, instruments, securities or other property, to the extent the Purchaser
would otherwise be entitled to own such Mortgage Loans and proceeds pursuant
to
Section 4 hereof, including all amounts, other than investment earnings,
from
time to time held or invested in any accounts created pursuant to the Pooling
and Servicing Agreement, whether in the form of cash, instruments, securities
or
other property; (c) the possession by the Purchaser or the Trustee (or the
related Custodian on its behalf) of Mortgage Notes and such other items of
property as constitute instruments, money, negotiable documents or chattel
paper
shall be deemed to be “possession by the secured party” for purposes of
perfecting the security interest pursuant to Section 9-305 (or comparable
provision) of the applicable Uniform Commercial Code; and (d) notifications
to
persons holding such property, and acknowledgments, receipts or confirmations
from persons holding such property, shall be deemed notifications to, or
acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of the Purchaser for the purpose of perfecting
such security interest under applicable law. Any assignment of the interest
of
the Purchaser pursuant to any provision hereof or pursuant to the Pooling
and
Servicing Agreement shall also be deemed to be an assignment of any security
interest created hereby. The Mortgage Loan Seller and the Purchaser shall,
to
the extent consistent with this Agreement, take such actions as may be
reasonably necessary to ensure that, if this Agreement were deemed to create
a
security interest in the Mortgage Loans, such security interest would be
deemed
to be a perfected security interest of first priority under applicable law
and
will be maintained as such throughout the term of the Pooling and Servicing
Agreement.
SECTION
7. Representations
and Warranties of the Mortgage Loan Seller Concerning the Mortgage
Loans.
The
Mortgage Loan Seller hereby represents and warrants to the Purchaser as of
the
Closing Date or such other date as may be specified below with respect to
each
Mortgage Loan:
(a) the
information set forth in the Mortgage Loan Schedule hereto is true and correct
in all material respects;
(b) immediately
prior to the transfer to the Purchaser, the Mortgage Loan Seller was the
sole
owner of beneficial title and holder of each Mortgage and Mortgage Note relating
to the Mortgage Loans and is conveying the same free and clear of any and
all
liens, claims, encumbrances, participation interests, equities, pledges,
charges
or security interests of any nature and the Mortgage Loan Seller has full
right
and authority to sell or assign the same pursuant to this
Agreement;
(c) each
Mortgage Loan at the time it was made complied in all material respects with
all
applicable local, state and federal laws and regulations, including, without
limitation, usury, equal credit opportunity, disclosure and recording laws
and
all applicable predatory abusive and fair lending laws; and each Mortgage
Loan
has been serviced in all material respects in accordance with all applicable
local, state and federal laws and regulations, including, without limitation,
usury, equal credit opportunity, disclosure and recording laws and all
applicable anti-predatory lending laws and the terms of the related Mortgage
Note, the Mortgage and other loan documents;
(d) there
is
no monetary default existing under any Mortgage or the related Mortgage Note
and
there is no material event which, with the passage of time or with notice
and
the expiration of any grace or cure period, would constitute a default, breach
or event of acceleration; and neither the Mortgage Loan Seller, any of its
affiliates nor any servicer of any related Mortgage Loan has taken any action
to
waive any default, breach or event of acceleration; and no foreclosure action
is
threatened or has been commenced with respect to the Mortgage Loan;
(e) the
terms
of the Mortgage Note and the Mortgage have not been impaired, waived, altered
or
modified in any respect, except by written instruments, (i) if required by
law
in the jurisdiction where the Mortgaged Property is located, or (ii) to protect
the interests of the Trustee on behalf of the Certificateholders;
(f) no
selection procedure reasonably believed by the Mortgage Loan Seller to be
adverse to the interests of the Certificateholders was utilized in selecting
the
Mortgage Loans;
(g) each
Mortgage is a valid and enforceable junior lien on the property securing
the
related Mortgage Note and each Mortgaged Property is owned by the Mortgagor
in
fee simple (except with respect to common areas in the case of condominiums,
PUDs and de minimis
PUDs) or
by leasehold for a term longer than the term of the related Mortgage, subject
only to (i) the lien of current real property taxes and assessments, (ii)
covenants, conditions and restrictions, rights of way, easements and other
matters of public record as of the date of recording of such Mortgage, such
exceptions being acceptable to mortgage lending institutions generally or
specifically reflected in the appraisal obtained in connection with the
origination of the related Mortgage Loan or referred to in the lender’s title
insurance policy delivered to the originator of the related Mortgage Loan
and
(iii) other matters to which like properties are commonly subject which do
not
materially interfere with the benefits of the security intended to be provided
by such Mortgage;
(h) there
is
no mechanics’ lien or claim for work, labor or material affecting the premises
subject to any Mortgage which is or may be a lien prior to, or equal with,
the
lien of such Mortgage except those which are insured against by the title
insurance policy referred to in clause (m) below;
(i) there
was
no delinquent tax or assessment lien against the property subject to any
Mortgage, except where such lien was being contested in good faith and a
stay
had been granted against levying on the property;
(j) there
is
no valid offset, defense or counterclaim to any Mortgage Note or Mortgage,
including the obligation of the Mortgagor to pay the unpaid principal and
interest on such Mortgage Note;
(k) the
physical property subject to any Mortgage is free of material damage and
is in
good repair and there is no proceeding pending or threatened for the total
or
partial condemnation of any Mortgaged Property;
(l) the
Mortgaged Property and all improvements thereon comply with all requirements
of
any applicable zoning and subdivision laws and ordinances;
(m) with
respect to any junior lien Mortgage Loan, other than any Piggyback Loan that
has
an initial principal amount less than or equal to $200,000, (a) a lender’s title
insurance policy or binder, or other assurance of title customary in the
relevant jurisdiction therefore in a form acceptable to Xxxxxx Xxx or Xxxxxxx
Mac, was issued on the date that each Mortgage Loan was created by a title
insurance company which, to the best of the related Mortgage Loan Seller’s
knowledge, was qualified to do business in the jurisdiction where the related
Mortgaged Property is located, insuring the related seller and its successors
and assigns. The related Mortgage Loan Seller is the sole insured under such
lender’s title insurance policy, and such policy, binder or assurance is valid
and remains in full force and effect, and each such policy, binder or assurance
shall contain all applicable endorsements including a negative amortization
endorsement, if applicable, or (b) a lien search was conducted at the time
of
origination with respect to the related Mortgaged Property.;
(n) at
the
time of origination, each Mortgaged Property was the subject of an appraisal
which conformed to the underwriting requirements of the originator of the
Mortgage Loan and, the appraisal is in a form acceptable to Xxxxxx Mae or
Xxxxxxx Mac;
(o) the
improvements on each Mortgaged Property securing a Mortgage Loan are insured
(by
an insurer which is acceptable to the Mortgage Loan Seller) against loss
by fire
and such hazards as are covered under a standard extended coverage endorsement
in the locale in which the Mortgaged Property is located, in an amount which
is
not less than the lesser of the maximum insurable value of the improvements
securing such Mortgage Loan or the outstanding principal balance of the Mortgage
Loan, but in no event in an amount less than an amount that is required to
prevent the Mortgagor from being deemed to be a co-insurer thereunder; if
the
improvement on the Mortgaged Property is a condominium unit, it is included
under the coverage afforded by a blanket policy for the condominium project;
if
upon origination of the related Mortgage Loan, the improvements on the Mortgaged
Property were in an area identified as a federally designated flood area,
a
flood insurance policy is in effect in an amount representing coverage not
less
than the least of (i) the outstanding principal balance of the Mortgage Loan,
(ii) the restorable cost of improvements located on such Mortgaged Property
or
(iii) the maximum coverage available under federal law; and each Mortgage
obligates the Mortgagor thereunder to maintain the insurance referred to
above
at the Mortgagor’s cost and expense;
(p) each
Mortgage Loan constitutes a "qualified mortgage" under Section 860G(a)(3)(A)
of
the Code and Treasury Regulation Section 1.860G-2(a)(1), (2), (4), (5), (6),
(7)
and (9) without reliance on the provisions of Treasury Regulation Section
1.860G-2(a)(3) or Treasury Regulation Section 1.860G-2(f)(2) or any other
provision that would allow a Mortgage Loan to be treated as a “qualified
mortgage” notwithstanding its failure to meet the requirements of Section
860G(a)(3)(A) of the Code and Treasury Regulation Section 1.860G-2(a)(1),
(2),
(4), (5), (6), (7) and (9);
(q) none
of
the Mortgage Loans are (a) loans subject to 12 CFR Part 226.31, 12 CFR Part
226.32 or 12 CFR Part 226.34 of Regulation Z, the regulation implementing
TILA,
which implements the Home Ownership and Equity Protection Act of 1994, as
amended or (b) “high cost home,” “covered” (excluding home loans defined as
“covered home loans” in the New Jersey Home
Ownership Security Act of 2002 that were originated between November 26,
2003
and July 7, 2004), “high risk home” or “predatory” loans under any applicable
state, federal or local law (or a similarly classified loan using different
terminology under a law imposing heightened regulatory scrutiny or additional
legal liability for residential mortgage loans having high interest rates,
points and/or fees);
(r) the
information set forth in Schedule A of the Prospectus Supplement with respect
to
the Mortgage Loans
is true
and correct in all material respects;
(s) no
Mortgage Loan (a) is a “high cost loan” or “covered loan” as applicable (as such
terms are defined in the then current Standard & Poor’s LEVELS® Glossary,
which is now Version 5.6(d), Appendix E, attached hereto as Exhibit 6) or
(b)
was originated on or after October 1, 2002 through March 6, 2003 and is governed
by the Georgia Fair Lending Act;
(t) each
Mortgage Loan was originated in accordance with the underwriting guidelines
of
the related originator;
(u) each
original Mortgage has been recorded or is in the process of being recorded
in
accordance with the requirements of Section 2.01 of the Pooling and Servicing
Agreement in the appropriate jurisdictions wherein such recordation is required
to perfect the lien thereof for the benefit of the Trust Fund;
(v) the
related Mortgage File contains each of the documents and instruments listed
in
Section 2.01 of the Pooling and Servicing Agreement, subject to any exceptions,
substitutions and qualifications as are set forth in such Section;
(w) the
Mortgage Loans are currently being serviced in accordance with accepted
servicing practices;
(x) with
respect to each Mortgage Loan that has a prepayment penalty feature, each
such
prepayment penalty is enforceable and will be enforced by the Mortgage Loan
Seller and each prepayment penalty
is
permitted pursuant to federal, state and local law. In addition, with respect
to
each Mortgage Loan (i) no Mortgage Loan will impose a prepayment penalty
for a
term in excess of five years from the date such Mortgage Loan was originated
and
(ii) such prepayment penalty is at least equal to the lesser of (A) the maximum
amount permitted under applicable law and (B) six months interest at the
related
Mortgage Rate on the amount prepaid in excess of 20% of the original principal
balance of such Mortgage Loan; and
(y) If
any of
the Mortgage Loans are secured by a leasehold interest, with respect to each
leasehold interest: the use of leasehold estates for residential properties
is
an accepted practice in the area where the related Mortgaged Property is
located; residential property in such area consisting of leasehold estates
is
readily marketable; the lease is recorded and no party is in any way in breach
of any provision of such lease; the leasehold is in full force and effect
and is
not subject to any prior lien or encumbrance by which the leasehold could
be
terminated or subject to any charge or penalty; and the remaining term of
the
lease does not terminate less than ten years after the maturity date of such
Mortgage Loan.
It
is
understood and agreed that the representations and warranties set forth in
this
Section 7 will inure to the benefit of the Purchaser, its successors and
assigns, notwithstanding any restrictive or qualified endorsement on any
Mortgage Note or assignment of Mortgage or the examination of any Mortgage
File.
Upon any substitution for a Mortgage Loan, the representations and warranties
set forth above shall be deemed to be made by the Mortgage Loan Seller as
to any
Replacement Mortgage Loan as of the date of substitution.
Upon
discovery or receipt of notice by the Mortgage Loan Seller, the Purchaser
or the
Trustee of a breach of any representation or warranty of the Mortgage Loan
Seller set forth in this Section 7 which materially and adversely affects
the
value of the interests of the Purchaser, the Certificateholders or the Trustee
in any of the Mortgage Loans delivered to the Purchaser pursuant to this
Agreement, the party discovering or receiving notice of such breach shall
give
prompt written notice to the others. In the case of any such breach of a
representation or warranty set forth in this Section 7, within 90 days from
the
date of discovery by the Mortgage Loan Seller, or the date the Mortgage Loan
Seller is notified by the party discovering or receiving notice of such breach
(whichever occurs earlier), the Mortgage Loan Seller will (i) cure such breach
in all material respects, (ii) purchase the affected Mortgage Loan at the
applicable Purchase Price or (iii) if within two years of the Closing Date,
substitute a qualifying Replacement Mortgage Loan in exchange for such Mortgage
Loan; provided that, (A) in the case of a breach of the representation and
warranty concerning the Mortgage Loan Schedule contained in clause (a) of
this
Section 7, if such breach is material and relates to any field on the Mortgage
Loan Schedule which identifies any Prepayment Charge or (B) in the case of
a
breach of the representation contained in clause (x) of this Section 7, then,
in
each case, in lieu of purchasing such Mortgage Loan from the Trust Fund at
the
Purchase Price, the Mortgage Loan Seller shall pay the amount of the Prepayment
Charge (net of any amount previously collected by or paid to the Trust Fund
in
respect of such Prepayment Charge) from its own funds and without reimbursement
therefor, and the Mortgage Loan Seller shall have no obligation to repurchase
or
substitute for such Mortgage Loan. The obligations of the Mortgage Loan Seller
to cure, purchase or substitute a qualifying Replacement Mortgage Loan shall
constitute the Purchaser’s, the Trustee’s and the Certificateholder’s sole and
exclusive remedy under this Agreement or otherwise respecting a breach of
representations or warranties hereunder with respect to the Mortgage Loans,
except for the obligation of the Mortgage Loan Seller to indemnify the Purchaser
for such breach as set forth in and limited by Section 13 hereof.
Any
cause
of action against the Mortgage Loan Seller or relating to or arising out
of a
breach by the Mortgage Loan Seller of any representations and warranties
made in
this Section 7 shall accrue as to any Mortgage Loan upon (i) discovery of
such
breach by the Mortgage Loan Seller or notice thereof by the party discovering
such breach and (ii) failure by the Mortgage Loan Seller to cure such breach,
purchase such Mortgage Loan or substitute a qualifying Replacement Mortgage
Loan
pursuant to the terms hereof.
SECTION
8. Representations
and Warranties Concerning the Mortgage Loan Seller.
As of
the date hereof and as of the Closing Date, the Mortgage Loan Seller represents
and warrants to the Purchaser as to itself in the capacity indicated as
follows:
(a) the
Mortgage Loan Seller (i) is a corporation duly organized, validly existing
and
in good standing under the laws of the State of Delaware and (ii) is qualified
and in good standing to do business in each jurisdiction where such
qualification is necessary, except where the failure so to qualify would
not
reasonably be expected to have a material adverse effect on the Mortgage
Loan
Seller’s business as presently conducted or on the Mortgage Loan Seller’s
ability to enter into this Agreement and to consummate the transactions
contemplated hereby;
(b) the
Mortgage Loan Seller has full power to own its property, to carry on its
business as presently conducted and to enter into and perform its obligations
under this Agreement;
(c) the
execution and delivery by the Mortgage Loan Seller of this Agreement has
been
duly authorized by all necessary action on the part of the Mortgage Loan
Seller;
and neither the execution and delivery of this Agreement, nor the consummation
of the transactions herein contemplated, nor compliance with the provisions
hereof or thereof, will conflict with or result in a breach of, or constitute
a
default under, any of the provisions of any law, governmental rule, regulation,
judgment, decree or order binding on the Mortgage Loan Seller or its properties
or the charter or by-laws of the Mortgage Loan Seller, except those conflicts,
breaches or defaults which would not reasonably be expected to have a material
adverse effect on the Mortgage Loan Seller’s ability to enter into this
Agreement and to consummate the transactions contemplated hereby;
(d) the
execution, delivery and performance by the Mortgage Loan Seller of this
Agreement and the consummation of the transactions contemplated hereby do
not
require the consent or approval of, the giving of notice to, the registration
with, or the taking of any other action in respect of, any state, federal
or
other governmental authority or agency, except those consents, approvals,
notices, registrations or other actions as have already been obtained, given
or
made and, in connection with the recordation of the Mortgages, powers of
attorney or assignments of Mortgages not yet completed;
(e) this
Agreement has been duly executed and delivered by the Mortgage Loan Seller
and,
assuming due authorization, execution and delivery by the Purchaser or the
parties thereto, constitutes a valid and binding obligation of the Mortgage
Loan
Seller enforceable against it in accordance with its terms (subject to
applicable bankruptcy and insolvency laws and other similar laws affecting
the
enforcement of the rights of creditors generally);
(f) there
are
no actions, suits or proceedings pending or, to the knowledge of the Mortgage
Loan Seller, threatened against the Mortgage Loan Seller, before or by any
court, administrative agency, arbitrator or governmental body (i) with respect
to any of the transactions contemplated by this Agreement or (ii) with respect
to any other matter which in the judgment of the Mortgage Loan Seller could
reasonably be expected to be determined adversely to the Mortgage Loan Seller
and if determined adversely to the Mortgage Loan Seller materially and adversely
affect the Mortgage Loan Seller’s ability to perform its obligations under this
Agreement and the Mortgage Loan Seller is not in default with respect to
any
order of any court, administrative agency, arbitrator or governmental body
so as
to materially and adversely affect the transactions contemplated by this
Agreement; and
(g) the
Mortgage Loan Seller’s Information (as defined in Section 13(a) hereof) does not
include any untrue statement of a material fact or omit to state a material
fact
necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading.
SECTION
9. Representations
and Warranties Concerning the Purchaser.
As of
the date hereof and as of the Closing Date, the Purchaser represents and
warrants to the Mortgage Loan Seller as follows:
(a) the
Purchaser (i) is a limited liability company duly organized, validly existing
and in good standing under the laws of the State of Delaware and (ii) is
qualified and in good standing to do business in each jurisdiction where
such
qualification is necessary, except where the failure so to qualify would
not
reasonably be expected to have a material adverse effect on the Purchaser’s
business as presently conducted or on the Purchaser’s ability to enter into this
Agreement and to consummate the transactions contemplated hereby;
(b) the
Purchaser has full power to own its property, to carry on its business as
presently conducted and to enter into and perform its obligations under this
Agreement;
(c) the
execution and delivery by the Purchaser of this Agreement has been duly
authorized by all necessary action on the part of the Purchaser; and neither
the
execution and delivery of this Agreement, nor the consummation of the
transactions herein contemplated, nor compliance with the provisions hereof,
will conflict with or result in a breach of, or constitute a default under,
any
of the provisions of any law, governmental rule, regulation, judgment, decree
or
order binding on the Purchaser or its properties or the certificate of formation
or limited liability company agreement of the Purchaser, except those conflicts,
breaches or defaults which would not reasonably be expected to have a material
adverse effect on the Purchaser’s ability to enter into this Agreement and to
consummate the transactions contemplated hereby or thereby;
(d) the
execution, delivery and performance by the Purchaser of this Agreement and
the
consummation of the transactions contemplated hereby or thereby do not require
the consent or approval of, the giving of notice to, the registration with,
or
the taking of any other action in respect of, any state, federal or other
governmental authority or agency, except those consents, approvals, notices,
registrations or other actions as have already been obtained, given or
made;
(e) this
Agreement has been duly executed and delivered by the Purchaser and, assuming
due authorization, execution and delivery by the Mortgage Loan Seller,
constitutes a valid and binding obligation of the Purchaser enforceable against
it in accordance with its terms (subject to applicable bankruptcy and insolvency
laws and other similar laws affecting the enforcement of the rights of creditors
generally);
(f) there
are
no actions, suits or proceedings pending or, to the knowledge of the Purchaser,
threatened against the Purchaser, before or by any court, administrative
agency,
arbitrator or governmental body (i) with respect to any of the transactions
contemplated by this Agreement or (ii) with respect to any other matter which
in
the judgment of the Purchaser could reasonably be expected to be determined
adversely to the Purchaser and if determined adversely to the Purchaser
materially and adversely affect the Purchaser’s ability to perform its
obligations under this Agreement; and the Purchaser is not in default with
respect to any order of any court, administrative agency, arbitrator or
governmental body so as to materially and adversely affect the transactions
contemplated by this Agreement; and
(g) the
Purchaser’s Information (as defined in Section 13(b) hereof) does not include
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading.
SECTION
10. Conditions
to Closing.
(a) The
obligations of the Purchaser under this Agreement will be subject to the
satisfaction, on or prior to the Closing Date, of the following
conditions:
(1) Each
of
the obligations of the Mortgage Loan Seller required to be performed at or
prior
to the Closing Date pursuant to the terms of this Agreement shall have been
duly
performed and complied with in all material respects; all of the representations
and warranties of the Mortgage Loan Seller under this Agreement shall be
true
and correct as of the date or dates specified in all material respects; and
no
event shall have occurred which, with notice or the passage of time, would
constitute a default under this Agreement or the Pooling and Servicing
Agreement; and the Purchaser shall have received certificates to that effect
signed by authorized officers of each of the Mortgage Loan Seller.
(2) The
Purchaser shall have received all of the following closing documents, in
such
forms as are agreed upon and reasonably acceptable to the Purchaser, duly
executed by all signatories other than the Purchaser as required pursuant
to the
respective terms thereof:
(i) If
required pursuant to Section 3 hereof, the Amendment dated as of the Closing
Date and any documents referred to therein;
(ii) If
required pursuant to Section 3 hereof, the Final Mortgage Loan Schedule
containing the information set forth on Exhibit
2
hereto,
one copy to be attached to each counterpart of the Amendment;
(iii) The
Pooling and Servicing Agreement, in form and substance reasonably satisfactory
to the Trustee and the Purchaser, and all documents required thereby duly
executed by all signatories;
(iv) A
certificate of an officer of the Mortgage Loan Seller dated as of the Closing
Date, in a form reasonably acceptable to the Purchaser, and attached thereto
the
resolutions of the Mortgage Loan Seller authorizing the transactions
contemplated by this Agreement, together with copies of the articles of
incorporation, by-laws and certificate of good standing of the Mortgage Loan
Seller;
(v) One
or
more opinions of counsel from the Mortgage Loan Seller’s counsel otherwise in
form and substance reasonably satisfactory to the Purchaser the Trustee and
each
Rating Agency;
(vi) A
letter
from each of the Rating Agencies giving each Class of Certificates set forth
on
Schedule A hereto the rating set forth therein; and
(vii) Such
other documents, certificates (including additional representations and
warranties) and opinions as may be reasonably necessary to secure the intended
ratings from each Rating Agency for the Certificates.
(3) The
Certificates to be sold to Bear Xxxxxxx pursuant to the Underwriting Agreement
and the Purchase Agreement shall have been issued and sold to Bear
Xxxxxxx.
(4) The
Mortgage Loan Seller shall have furnished to the Purchaser such other
certificates of its officers or others and such other documents and opinions
of
counsel to evidence fulfillment of the conditions set forth in this Agreement
and the transactions contemplated hereby as the Purchaser and their respective
counsel may reasonably request.
(b) The
obligations of the Mortgage Loan Seller under this Agreement shall be subject
to
the satisfaction, on or prior to the Closing Date, of the following
conditions:
(1) The
obligations of the Purchaser required to be performed by it on or prior to
the
Closing Date pursuant to the terms of this Agreement shall have been duly
performed and complied with in all material respects, and all of the
representations and warranties of the Purchaser under this Agreement shall
be
true and correct in all material respects as of the date hereof and as of
the
Closing Date, and no event shall have occurred which would constitute a breach
by it of the terms of this Agreement or the Pooling and Servicing Agreement,
and
the Mortgage Loan Seller shall have received a certificate to that effect
signed
by an authorized officer of the Purchaser.
(2) The
Mortgage Loan Seller shall have received copies of all of the following closing
documents, in such forms as are agreed upon and reasonably acceptable to
the
Mortgage Loan Seller, duly executed by all signatories other than the related
Mortgage Loan Seller as required pursuant to the respective terms
thereof:
(i) If
required pursuant to Section 3 hereof, the Amendment dated as of the Closing
Date and any documents referred to therein;
(ii) The
Pooling and Servicing Agreement, in form and substance reasonably satisfactory
to the Mortgage Loan Seller and the Trustee, and all documents required thereby
duly executed by all signatories;
(iii) A
certificate of an officer of the Purchaser dated as of the Closing Date,
in a
form reasonably acceptable to the Mortgage Loan Seller and attached thereto
the
written consent of the member of the Purchaser authorizing the transactions
contemplated by this Agreement, the Pooling and Servicing Agreement, together
with copies of the Purchaser’s certificate of formation, limited liability
company agreement and evidence as to the good standing of the Purchaser dated
as
of a recent date;
(iv) One
or
more opinions of counsel from the Purchaser’s counsel in form and substance
reasonably satisfactory to the Mortgage Loan Seller, the Trustee and the
Rating
Agencies; and
(v) Such
other documents, certificates (including additional representations and
warranties) and opinions as may be reasonably necessary to secure the intended
rating from each Rating Agency for the Certificates.
SECTION
11. Fees
and Expenses.
Subject
to Section 16 hereof, the Mortgage Loan Seller shall pay on the Closing Date
or
such later date as may be agreed to by the Purchaser (i) the fees and expenses
of the Mortgage Loan Seller’s attorneys and the reasonable fees and expenses of
the Purchaser’s attorneys, (ii) the fees and expenses of Deloitte & Touche
LLP, (iii) the fee for the use of Purchaser’s Registration Statement based on
the aggregate original principal amount of the Certificates and the filing
fee
of the Commission as in effect on the date on which the Registration Statement
was declared effective, (iv) the fees and expenses including counsel’s fees and
expenses in connection with any “blue sky” and legal investment matters, (v) the
fees and expenses of the Trustee which shall include without limitation the
fees
and expenses of the Trustee (and the fees and disbursements of its counsel)
with
respect to (A) legal and document review of this Agreement, the Pooling and
Servicing Agreement, the Certificates and related agreements, (B) attendance
at
the Closing and (C) review of the Mortgage Loans to be performed by the Trustee
or the related Custodian on its behalf, (vi) the expenses for printing or
otherwise reproducing the Certificates, the Prospectus and the Prospectus
Supplement, (vii) the fees and expenses of each Rating Agency (both initial
and
ongoing), (viii) the fees and expenses relating to the preparation and
recordation of mortgage assignments (including intervening assignments, if
any
and if available, to evidence a complete chain of title from the originator
to
the Trustee) from the Mortgage Loan Seller to the Trustee or the expenses
relating to the Opinion of Counsel referred to in Section 6(a) hereof, as
the
case may be and (ix) Mortgage File due diligence expenses and other
out-of-pocket expenses incurred by the Purchaser in connection with the purchase
of the Mortgage Loans and by Bear Xxxxxxx in connection with the sale of
the
Certificates. The Mortgage Loan Seller additionally agrees to pay directly
to
any third party on a timely basis the fees provided for above which are charged
by such third party and which are billed periodically.
SECTION
12. Accountants’
Letters.
(a) Deloitte
& Touche LLP
will
review the characteristics of a sample of the Mortgage Loans described in
the
Final Mortgage Loan Schedule and will compare those characteristics to the
description of the Mortgage Loans contained in the Free Writing Prospectus
under
the captions “Summary—The Mortgage Loans” and “The Mortgage Pool” and in
Schedule A thereto. Deloitte & Touche LLP
will
review the characteristics of a sample of the Mortgage Loans described in
the
Final Mortgage Loan Schedule and will compare those characteristics to the
description of the Mortgage Loans contained in the Prospectus Supplement
under
the captions “Summary—The Mortgage Loans” and “The Mortgage Pool” and in
Schedule A thereto. The Mortgage Loan Seller will cooperate with the Purchaser
in making available all information and taking all steps reasonably necessary
to
permit such accountants to complete the review and to deliver the letters
required of them under the Underwriting Agreement. Deloitte & Touche
LLP
will
also confirm certain calculations as set forth under the caption “Yield,
Prepayment and Maturity Considerations” in the Prospectus
Supplement.
(b) To
the
extent statistical information with respect to the Mortgage Loan Seller’s
servicing portfolio is included in the Prospectus Supplement under the caption
“Master
Servicing and Servicing of the Mortgage Loans,”
a
letter from the certified public accountant for the Mortgage Loan Seller
will be
delivered to the Purchaser dated the date of the Prospectus Supplement, in
the
form previously agreed to by the Mortgage Loan Seller and the Purchaser,
with
respect to such statistical information.
SECTION
13. Indemnification.
(a) The
Mortgage Loan Seller shall indemnify and hold harmless the Purchaser and
its
directors, officers and controlling persons (as defined in Section 15 of
the
Securities Act) from and against any loss, claim, damage or liability or
action
in respect thereof, to which they or any of them may become subject, under
the
Securities Act or otherwise, insofar as such loss, claim, damage, liability
or
action arises out of, or is based upon any untrue statement of a material
fact
contained in the Mortgage
Loan Seller’s Information
as
identified in Exhibit
3,
the
omission to state in the Free Writing Prospectus, the Prospectus Supplement
or
Prospectus (or any amendment thereof or supplement thereto approved by the
Mortgage Loan Seller and in which additional Mortgage Loan Seller’s Information
is identified), in reliance upon and in conformity with Mortgage Loan Seller’s
Information a material fact required to be stated therein or necessary to
make
the statements therein in light of the circumstances in which they were made,
not misleading; and the Mortgage Loan Seller shall reimburse the Purchaser
and
each other indemnified party for any legal and other expenses reasonably
incurred by them in connection with investigating or defending or preparing
to
defend against any such loss, claim, damage, liability or action.
(b) The
foregoing indemnity agreement is in addition to any liability which the Mortgage
Loan Seller otherwise may have to the Purchaser or any other such indemnified
party.
(c) The
Purchaser shall indemnify and hold harmless the Mortgage Loan Seller and
its
respective directors, officers and controlling persons (as defined in Section
15
of the Securities Act) from and against any loss, claim, damage or liability
or
action in respect thereof, to which they or any of them may become subject,
under the Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon any untrue statement
of a
material fact contained in the Purchaser’s
Information
as
identified in Exhibit
4,
the
omission to state in the Prospectus Supplement or Prospectus (or any amendment
thereof or supplement thereto approved by the Purchaser and in which additional
Purchaser’s Information is identified), in reliance upon and in conformity with
the Purchaser’s Information, a material fact required to be stated therein or
necessary to make the statements therein in light of the circumstances in
which
they were made, not misleading; and the Purchaser shall reimburse the Mortgage
Loan Seller and each other indemnified party for any legal and other expenses
reasonably incurred by them in connection with investigating or defending
or
preparing to defend any such loss, claim, damage, liability or action. The
foregoing indemnity agreement is in addition to any liability which the
Purchaser otherwise may have to the Mortgage Loan Seller or any other such
indemnified party.
(d) Promptly
after receipt by an indemnified party under subsection (a) or (b) above of
notice of the commencement of any action, such indemnified party shall, if
a
claim in respect thereof is to be made against the indemnifying party under
such
subsection, notify each party against whom indemnification is to be sought
in
writing of the commencement thereof (but the failure so to notify an
indemnifying party shall not relieve it from any liability which it may have
under this Section 13 except to the extent that it has been prejudiced in
any
material respect by such failure or from any liability which it may have
otherwise). In case any such action is brought against any indemnified party,
and it notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the extent
it
may elect by written notice delivered to the indemnified party promptly (but,
in
any event, within 30 days) after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the foregoing, the
indemnified party or parties shall have the right to employ its or their
own
counsel in any such case, but the fees and expenses of such counsel shall
be at
the expense of such indemnified party or parties unless (i) the employment
of
such counsel shall have been authorized in writing by one of the indemnifying
parties in connection with the defense of such action, (ii) the indemnifying
parties shall not have employed counsel to have charge of the defense of
such
action within a reasonable time after notice of commencement of the action,
or
(iii) such indemnified party or parties shall have reasonably concluded that
there is a conflict of interest between itself or themselves and the
indemnifying party in the conduct of the defense of any claim or that the
interests of the indemnified party or parties are not substantially co-extensive
with those of the indemnifying party (in which case the indemnifying parties
shall not have the right to direct the defense of such action on behalf of
the
indemnified party or parties), in any of which events such fees and expenses
shall be borne by the indemnifying parties (provided,
however,
that
the indemnifying party shall be liable only for the fees and expenses of
one
counsel in addition to one local counsel in the jurisdiction involved. Anything
in this subsection to the contrary notwithstanding, an indemnifying party
shall
not be liable for any settlement or any claim or action effected without
its
written consent; provided,
however,
that
such consent was not unreasonably withheld.
(e) If
the
indemnification provided for in paragraphs (a) and (b) of this Section 13
shall
for any reason be unavailable to an indemnified party in respect of any loss,
claim, damage or liability, or any action in respect thereof, referred to
in
Section 13, then the indemnifying party shall in lieu of indemnifying the
indemnified party contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in
respect
thereof, in such proportion as shall be appropriate to reflect the relative
benefits received by the Mortgage Loan Seller on the one hand and the Purchaser
on the other from the purchase and sale of the Mortgage Loans, the offering
of
the Certificates and the other transactions contemplated hereunder. No person
found liable for a fraudulent misrepresentation shall be entitled to
contribution from any person who is not also found liable for such fraudulent
misrepresentation.
(f) The
parties hereto agree that reliance by an indemnified party on any publicly
available information or any information or directions furnished by an
indemnifying party shall not constitute negligence, bad faith or willful
misconduct by such indemnified party.
SECTION
14. Notices.
All
demands, notices and communications hereunder shall be in writing but may
be
delivered by facsimile transmission subsequently confirmed in writing. Notices
to the Mortgage Loan Seller shall be directed to EMC Mortgage Corporation,
0000
Xxxx Xxxxx Xxxxx, Xxxxxxxxxx, Xxxxx 00000, (Telecopy: (972-444-2880)),
attention: President or General Counsel; notices to the Purchaser shall be
directed to Bear Xxxxxxx Asset Backed Securities I LLC, 000 Xxxxxxx Xxxxxx,
Xxx
Xxxx, Xxx Xxxx 00000, (Telecopy: (212-272-7206)), Attention: Chief Counsel;
or
to any other address as may hereafter be furnished by one party to the other
party by like notice. Any such demand, notice or communication
hereunder shall be deemed to have been received on the date received at the
premises of the addressee (as evidenced, in the case of registered or certified
mail, by the date noted on the return receipt) provided that it is received
on a
business day during normal business hours and, if received after normal business
hours, then it shall be deemed to be received on the next business
day.
SECTION
15. Transfer
of Mortgage Loans.
The
Purchaser retains the right to assign the Mortgage Loans and any or all of
its
interest under this Agreement to the Trustee without the consent of the Mortgage
Loan Seller, and, upon such assignment, the Trustee shall succeed to the
applicable rights and obligations of the Purchaser hereunder; provided, however,
the Purchaser shall remain entitled to the benefits set forth in Sections
11, 13
and 17 hereto and as provided in Section 2(a). Notwithstanding the foregoing,
the sole and exclusive right and remedy of the Trustee with respect to a
breach
of representation or warranty of the Mortgage Loan Seller shall be the cure,
purchase or substitution obligations of the Mortgage Loan Seller contained
in
Sections 5 and 7 hereof.
SECTION
16. Termination.
This
Agreement may be terminated (a) by the mutual consent of the parties hereto
prior to the Closing Date, (b) by the Purchaser, if the conditions to the
Purchaser’s obligation to close set forth under Section 10(a) hereof are not
fulfilled as and when required to be fulfilled or (c) by the Mortgage Loan
Seller, if the conditions to the Mortgage Loan Seller’s obligation to close set
forth under Section 10(b) hereof are not fulfilled as and when required to
be
fulfilled. In the event of termination pursuant to clause (b), the Mortgage
Loan
Seller shall pay, and in the event of termination pursuant to clause (c),
the
Purchaser shall pay, all reasonable out-of-pocket expenses incurred by the
other
in connection with the transactions contemplated by this Agreement. In the
event
of a termination pursuant to clause (a), each party shall be responsible
for its
own expenses.
SECTION
17. Representations,
Warranties and Agreements to Survive Delivery.
All
representations, warranties and agreements contained in this Agreement, or
contained in certificates of officers of the Mortgage Loan Seller submitted
pursuant hereto, shall remain operative and in full force and effect and
shall
survive delivery of the Mortgage Loans to the Purchaser (and by the Purchaser
to
the Trustee). Subsequent to the delivery of the Mortgage Loans to the Purchaser,
the Mortgage Loan Seller’s representations and warranties contained herein with
respect to the Mortgage Loans shall be deemed to relate to the Mortgage Loans
actually delivered to the Purchaser and included in the Final Mortgage Loan
Schedule and any Replacement Mortgage Loan and not to those Mortgage Loans
deleted from the Preliminary Mortgage Loan Schedule pursuant to Section 3
hereof
prior to the Closing.
SECTION
18. Severability.
If any
provision of this Agreement shall be prohibited or invalid under applicable
law,
this Agreement shall be ineffective only to such extent, without invalidating
the remainder of this Agreement.
SECTION
19. Counterparts.
This
Agreement may be executed in counterparts, each of which will be an original,
but which together shall constitute one and the same agreement.
SECTION
20. Amendment.
This
Agreement cannot be amended or modified in any manner without the prior written
consent of each party.
SECTION
21. GOVERNING
LAW.
THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF
OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
SECTION
22. Further
Assurances.
Each of
the parties agrees to execute and deliver such instruments and take such
actions
as another party may, from time to time, reasonably request in order to
effectuate the purpose and to carry out the terms of this Agreement including
any amendments hereto which may be required by either Rating
Agency.
SECTION
23. Successors
and Assigns.
(a) This
Agreement shall bind and inure to the benefit of and be enforceable by the
Mortgage Loan Seller and the Purchaser and their permitted successors and
assigns and, to the extent specified in Section 13 hereof, Bear Xxxxxxx,
and
their directors, officers and controlling persons (within the meaning of
federal
securities laws), to the extent of its rights as a third party beneficiary
hereunder. The Mortgage Loan Seller acknowledges and agrees that the Purchaser
may assign its rights under this Agreement (including, without limitation,
with
respect to the Mortgage Loan Seller’s representations and warranties respecting
the Mortgage Loans) to the Trustee. Any person into which the Mortgage Loan
Seller may be merged or consolidated (or any person resulting from any merger
or
consolidation involving the Mortgage Loan Seller), any person resulting from
a
change in form of the Mortgage Loan Seller or any person succeeding to the
business of the Mortgage Loan Seller, shall be considered the “successor” of the
Mortgage Loan Seller hereunder and shall be considered a party hereto without
the execution or filing of any paper or any further act or consent on the
part
of any party hereto. Except as provided in the two preceding sentences, this
Agreement cannot be assigned, pledged or hypothecated by either party hereto
without the written consent of the other parties to this Agreement and any
such
assignment or purported assignment shall be deemed null and void.
SECTION
24. The
Mortgage Loan Seller.
The
Mortgage Loan Seller will keep in full force and effect its existence, all
rights and franchises as a corporation or a limited liability company, as
the
case may be, under the laws of the State of its incorporation and will obtain
and preserve its qualification to do business as a foreign corporation or
a
limited liability company, as the case may be, in each jurisdiction in which
such qualification is necessary to perform its obligations under this
Agreement.
SECTION
25. Entire
Agreement.
This
Agreement contains the entire agreement and understanding between the parties
with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements, understandings, inducements and conditions, express
or implied, oral or written, of any nature whatsoever with respect to the
subject matter hereof.
SECTION
26. No
Partnership.
Nothing
herein contained shall be deemed or construed to create a partnership or
joint
venture between the parties hereto.
[Signature
Page Follows]
IN
WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto
by their respective duly authorized officers as of the date first above
written.
|
EMC
MORTGAGE CORPORATION
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
|
BEAR
XXXXXXX ASSET BACKED SECURITIES I LLC
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
EXHIBIT
1
CONTENTS
OF MORTGAGE FILE
With
respect to each Mortgage Loan, the Mortgage File shall include each of the
following items, which shall be available for inspection by the Purchaser
or its
designee, and which shall be delivered to the Purchaser or its designee pursuant
to the terms of this Agreement.
(i) The
original Mortgage Note, including any riders thereto, endorsed without recourse
to the order of blank or to “Citibank, N.A.”, as Trustee for certificateholders
of SACO I Trust, Mortgage-Backed Certificates, Series 2006-9,” and showing to
the extent available to the Mortgage Loan Seller an unbroken chain of
endorsements from the original payee thereof to the Person endorsing it to
the
Trustee;
(ii) the
original Mortgage and, if the related Mortgage Loan is a MOM Loan, noting
the
presence of the MIN and language indicating that such Mortgage Loan is a
MOM
Loan, which shall have been recorded (or, for Mortgage Loans other than the
EMC
Flow Loans, if the original is not available, a copy), with evidence of such
recording indicated thereon (or if clause (x) in the proviso below applies,
shall be in recordable form);
(iii) unless
the Mortgage Loan is a MOM Loan, the assignment (either an original or a
copy,
which may be in the form of a blanket assignment if permitted in the
jurisdiction in which the Mortgaged Property is located) to the Trustee of
the
Mortgage with respect to each Mortgage Loan in the name of “Citibank, N.A., as
Trustee for certificateholders of SACO I Trust, Mortgage-Backed Certificates,
Series 2006-9,” which shall have been recorded (or if clause (x) in the proviso
below applies, shall be in recordable form);
(iv) an
original or a copy of all intervening assignments of the Mortgage, if any,
to
the extent available to the Mortgage Loan Seller, with evidence of recording
thereon;
(v) the
original policy of title insurance or mortgagee’s certificate of title insurance
or commitment or binder for title insurance, if available, or a copy thereof,
or, in the event that such original title insurance policy is unavailable,
a
photocopy thereof, or in lieu thereof, a current lien search on the related
Mortgaged Property and
(vi) originals
or copies of all available assumption, modification or substitution agreements,
if any; provided, however, that in lieu of the foregoing, the related Mortgage
Loan Seller may deliver the following documents, under the circumstances
set
forth below: (x) if any Mortgage, assignment thereof to the Trustee or
intervening assignments thereof have been delivered or are being delivered
to
recording offices for recording and have not been returned in time to permit
their delivery as specified above, the Mortgage Loan Seller may deliver or
may
cause to be delivered a true copy thereof with a certification by the related
Mortgage Loan Seller or the Master Servicer, on the face of such copy,
substantially as follows: “Certified to be a true and correct copy of the
original, which has been transmitted for recording”; (y) in lieu of the
Mortgage, assignments to the Trustee or intervening assignments thereof,
if the
applicable jurisdiction retains the originals of such documents or if the
originals are lots (in each case, as evidenced by a certification from the
Mortgage Loan Seller or the Master Servicer to such effect), the Mortgage
Loan
Seller may deliver photocopies of such documents containing an original
certification by the judicial or other governmental authority of the
jurisdiction where such documents were recorded; and (z) in lieu of the Mortgage
Notes relating to the Mortgage Loans identified in the list set forth in
Exhibit
J to the Pooling and Servicing Agreement, the Mortgage Loan Seller may deliver
a
lost note affidavit and indemnities of the Mortgage Loan Seller; and provided,
further, however, that in the case of Mortgage Loans which have been prepaid
in
full after the Cut-Off Date and prior to the Closing Date, the Mortgage Loan
Seller, in lieu of delivering the above documents, may deliver to the Trustee
a
certification by the Mortgage Loan Seller or the Master Servicer to such
effect.
In the case of the documents referred to in clause (x) above, the Mortgage
Loan
Seller shall deliver such documents to the Trustee or its Custodian promptly
after they are received. The Mortgage Loan Seller shall cause, at its expense,
the Mortgage and intervening assignments, if any, and to the extent required
in
accordance with the foregoing, the assignment of the Mortgage to the Trustee
to
be submitted for recording promptly after the Closing Date; provided that
the
Mortgage Loan Seller need not cause to be recorded any assignment (a) in
any
jurisdiction under the laws of which, as evidenced by an Opinion of Counsel
addressed to the Trustee delivered by the Mortgage Loan Seller to the Trustee
and the Rating Agencies, the recordation of such assignment is not necessary
to
protect the Trustee’s interest in the related Mortgage Loan or (b) if MERS is
identified on the Mortgage or on a properly recorded assignment of the Mortgage
as mortgagee of record solely as nominee for the Mortgage Loan Seller and
its
successors and assigns. In the event that the Mortgage Loan Seller, the
Purchaser or the Master Servicer gives written notice to the Trustee that
a
court has recharacterized the sale of the Mortgage Loans as a financing,
the
Mortgage Loan Seller shall submit or cause to be submitted for recording
as
specified above or, should the Mortgage Loan Seller fail to perform such
obligations, the Master Servicer shall cause each such previously unrecorded
assignment to be submitted for recording as specified above at the expense
of
the Trust. In the event a Mortgage File is released to the Mortgage Loan
Seller
or the Master Servicer as a result of such Person having completed a Request
for
Release, the Custodian shall, if not so completed, complete the assignment
of
the related Mortgage in the manner specified in clause (iii) above.
EXHIBIT
2
MORTGAGE
LOAN SCHEDULE INFORMATION
The
Preliminary and Final Mortgage Loan Schedules shall set forth the following
information with respect to each Mortgage Loan:
(a) the
city,
state and zip code of the Mortgaged Property;
(b) the
property type;
(c) the
Mortgage Rate;
(d) the
Servicing Fee Rate;
(e) the
Master Servicer’s Fee Rate;
(f) the
LPMI
Fee, if applicable;
(g) the
Trustee Fee Rate, if applicable;
(h) the
Net
Rate;
(i) the
maturity date;
(j) the
stated original term to maturity;
(k) the
stated remaining term to maturity;
(l) the
original Principal Balance;
(m) the
first
payment date;
(n) the
principal and interest payment in effect as of the Cut-off Date;
(o) the
unpaid Principal Balance as of the Cut-off Date;
(p) the
Loan-to-Value Ratio at origination;
(q) the
insurer of any Primary Mortgage Insurance Policy;
(r) the
MIN
with respect to each MOM Loan;
(s) the
Gross
Margin, if applicable;
(t) the
next
Adjustment Date, if applicable;
(u) the
Maximum Lifetime Mortgage Rate, if applicable;
(v) the
Minimum Lifetime Mortgage Rate, if applicable;
(w) the
Periodic Rate Cap, if applicable;
(x) the
Loan
Group, if applicable;
(y) a
code
indicating whether the Mortgage Loan is negatively amortizing;
(z) which
Mortgage Loans adjust after an initial fixed-rate period of one, two, three,
five, seven or ten years or any other period;
(aa) the
Prepayment Charge, if any;
(bb) lien
position (e.g., first lien or second lien);
(cc) a
code
indicating whether the Mortgage Loan is has a balloon payment;
(dd) a
code
indicating whether the Mortgage Loan is an interest-only loan;
(ee) the
interest-only term, if applicable;
(ff) the
Mortgage Loan Seller; and
(gg) the
original amortization term.
Such
schedule also shall set forth for all of the Mortgage Loans, the total number
of
Mortgage Loans, the total of each of the amounts described under (n) and
(j)
above, the weighted average by principal balance as of the Cut-off Date of
each
of the rates described under (c) through (h) above, and the weighted average
remaining term to maturity by unpaid principal balance as of the Cut-off
Date.
EXHIBIT
3
MORTGAGE
LOAN SELLER’S INFORMATION
All
information in the Prospectus Supplement described under the following captions:
“SUMMARY — The Mortgage Loans,” “THE MORTGAGE POOL”, “THE SPONSOR” and “SCHEDULE
A — Mortgage Loan Statistical Data.”
EXHIBIT
4
PURCHASER’S
INFORMATION
All
information in the Prospectus Supplement and the Prospectus, except the Mortgage
Loan Seller’s Information.
EXHIBIT
5
SCHEDULE
OF LOST NOTES
Available
Upon Request
EXHIBIT
6
REVISED
April 18, 0000
XXXXXXXX
X - Standard & Poor’s Predatory Lending Categories
Standard
& Poor’s has categorized loans governed by anti-predatory lending laws in
the Jurisdictions listed below into three categories based upon a combination
of
factors that include (a) the risk exposure associated with the assignee
liability and (b) the tests and thresholds set forth in those laws. Note
that
certain loans classified by the relevant statute as Covered are included
in
Standard & Poor’s High Cost Loan Category because they included thresholds
and tests that are typical of what is generally considered High Cost by the
industry.
Standard
& Poor’s High Cost Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
|
Arkansas
|
Arkansas
Home Loan Protection Act,
Ark.
Code Xxx. §§ 00-00-000 et
seq.
Effective
July 16, 2003
|
High
Cost Home Loan
|
|
Cleveland
Heights, OH
|
Ordinance
No. 72-2003 (PSH), Mun.
Code
§§ 757.01 et
seq.
Effective
June 2, 2003
|
Covered
Loan
|
|
Colorado
|
Consumer
Equity Protection, Colo. Stat.
Xxx.
§§ 5-3.5-101 et
seq.
Effective
for covered loans offered or entered into on or after January
1, 2003.
Other provisions of the Act took effect on June 7, 2002
|
Covered
Loan
|
|
Connecticut
|
Connecticut
Abusive Home Loan
Lending
Practices Act, Conn. Gen. Stat.
§§
36a-746 et
seq.
Effective
October 1, 2001
|
High
Cost Home Loan
|
|
District
of Columbia
|
Home
Loan Protection Act, D.C. Code
§§
26-1151.01 et
seq.
Effective
for loans closed on or after January 28, 2003
|
Covered
Loan
|
|
Florida
|
Fair
Lending Act, Fla. Stat. Xxx. §§
494.0078
et
seq.
Effective
October 2, 2002
|
High
Cost Home Loan
|
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
|
Georgia
(Oct. 1, 2002 -
Mar.
6, 2003)
|
Georgia
Fair Lending Act, Ga. Code
Xxx.
§§ 7-6A-1 et
seq.
Effective
October 1, 2002 - March 6 2003
|
High
Cost Home Loan
|
|
Georgia
as amended
(Mar.
7, 2003 - current)
|
Georgia
Fair Lending Act, Ga. Code
Xxx.
§§ 7-6A-1 et
seq.
Effective
for loans closed on or after
March
7, 2003
|
High
Cost Home Loan
|
|
HOEPA
Section 32
|
Home
Ownership and Equity Protection
Act
of 1994, 15 U.S.C. § 1639, 12
C.F.R.
§§ 226.32 and 226.34
Effective
October 1, 1995, amendments
October
1, 2002
|
High
Cost Loan
|
|
Illinois
|
High
Risk Home Loan Act, Ill. Comp.
Stat.
tit. 815, §§ 137/5 et
seq.
Effective
January 1, 2004 (prior to this date, regulations under
Residential
Mortgage
License Act effective from May 14, 2001)
|
High
Risk Home Loan
|
|
Kansas
|
Consumer
Credit Code, Kan. Stat. Xxx.
§§
16a-1-101 et
seq.
Sections
16a-1-301 and 16a-3-207 became effective April 14, 1999;
Section
16a-3-308a became effective July 1, 1999
|
High
Loan to Value Consumer Loan (id.
§
16a-3-207) and;
|
|
High
APR Consumer Loan (id.
§
16a-3-308a)
|
||
|
Kentucky
|
2003
KY H.B. 000 - Xxxx Xxxx Xxxx
Xxxx
Xxx, Xx. Rev. Stat. §§ 360.100 et seq.
Effective
June 24, 2003
|
High
Cost Home Loan
|
|
Maine
|
Truth
in Lending, Me. Rev. Stat. tit. 9-
A,
§§ 8-101 et
seq.
Effective
September 29, 1995 and as amended from time to time
|
High
Rate High Fee Mortgage
|
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
|
Massachusetts
|
Part
40 and Part 32, 209 C.M.R. §§
32.00
et
seq.
and 209 C.M.R. §§ 40.01 et
seq.
Effective
March 22, 2001 and amended from time to time
|
High
Cost Home Loan
|
|
Nevada
|
Assembly
Xxxx No. 284, Nev. Rev. Stat.
§§
598D.010 et
seq.
Effective
October 1, 2003
|
Home
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security
Act
of 2002, N.J. Rev. Stat. §§ 46:10B- 22 et
seq.
Effective
for loans closed on or after November 27, 2003
|
High
Cost Home Loan
|
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev.
Stat.
§§ 58-21A-1 et
seq.
Effective
as of January 1, 2004; Revised
as
of February 26, 2004
|
High
Cost Home Loan
|
|
New
York
|
N.Y.
Banking Law Article 6-1
Effective
for applications made on or after April 1, 2003
|
High
Cost Home Loan
|
|
North
Carolina
|
Restrictions
and Limitations on High
Cost
Home Loans, N.C. Gen. Stat. §§ 24-1.1E et
seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines
of
credit)
|
High
Cost Home Loan
|
|
Ohio
|
H.B.
386 (codified in various sections of the Ohio Code), Ohio Rev.
Code Xxx.
§§ 1349.25 et
seq.
Effective
May 24, 2002
|
Covered
Loan
|
|
Oklahoma
|
Consumer
Credit Code (codified in various sections of Title 14A)
Effective
July 1, 2000; amended effective January 1, 2004
|
Subsection
10 Mortgage
|
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
|
South
Carolina
|
South
Carolina High Cost and
Consumer
Home Loans Act, S.C. Code
Xxx.
§§ 37-23-10 et
seq.
Effective
for loans taken on or after January 1, 2004
|
High
Cost Home Loan
|
|
West
Virginia
|
West
Virginia Residential Mortgage Lender, Broker and Servicer Act,
W.
Va.
Code Xxx. §§ 31-17-1 et
seq.
Effective
June 5, 0000
|
Xxxx
Xxxxxxxx Mortgage Loan Act Loan
|
Standard
& Poor’s Covered Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
|
Georgia
(Oct. 1, 2002 -
Mar.
6, 2003)
|
Georgia
Fair Lending Act, Ga. Code
Xxx.
§§ 7-6A-1 et
seq.
Effective
October 1, 2002 - March 6, 2003
|
Covered
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security
Act
of 2002, N.J. Rev. Stat. §§ 46:10B 22 et
seq.
Effective
November 27, 2003 - July 5, 2004
|
Covered
Home Loan
|
Standard
& Poor’s Home Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
|
Georgia
(Oct. 1, 2002 -
Mar.
6, 2003)
|
Georgia
Fair Lending Act, Ga. Code
Xxx.
§§ 7-6A-1 et
seq.
Effective
October 1, 2002 - March 6, 2003
|
Home
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security
Act
of 2002, N.J. Rev. Stat. §§ 46:10B- 22 et
seq.
Effective
for loans closed on or after November 27, 2003
|
Home
Loan
|
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev. Stat. §§ 58-21A-1 et
seq.
Effective
as of January 1, 2004; Revised as of February 26, 2004
|
Home
Loan
|
|
North
Carolina
|
Restrictions
and Limitations on High Cost Home Loans, N.C. Gen. Stat. §§
24-1.1E
et
seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines
of
credit)
|
Consumer
Home Loan
|
|
South
Carolina
|
South
Carolina High Cost and Consumer Home Loans Act, S.C. Code Xxx.
§§ 37-23-10
et
seq.
Effective
for loans taken on or after January 1, 2004
|
Consumer
Home Loan
|
SCHEDULE
A
REQUIRED
RATINGS FOR EACH CLASS OF CERTIFICATES
Public
Certificates
|
Class
|
Standard
& Poor’s
|
Moody’s
|
|
A
|
AAA
|
Aaa
|
|
M-1
|
AA+
|
Aa1
|
|
M-2
|
AA
|
Aa2
|
|
M-3
|
AA-
|
Aa3
|
|
M-4
|
A+
|
A1
|
|
X-0
|
X
|
X0
|
|
X-0
|
X-
|
X0
|
|
X-0
|
BBB+
|
Baa1
|
|
B-2
|
BBB
|
Baa2
|
|
B-3
|
BBB-
|
Baa3
|
None
of
the above ratings has been lowered, qualified or withdrawn since the dates
of
issuance of such ratings by the Rating Agencies.
Private
Certificates
|
Class
|
Standard
& Poor’s
|
Moody’s
|
|
X-0
|
[XXx]
|
[Xx0]
|
|
C
|
Not
Rated
|
Not
Rated
|
|
R-1
|
Not
Rated
|
Not
Rated
|
|
R-2
|
Not
Rated
|
Not
Rated
|
|
R-3
|
Not
Rated
|
Not
Rated
|
|
RX
|
Not
Rated
|
Not
Rated
|
EXHIBIT
M
FORM
OF
BACK-UP CERTIFICATION
Re: The
[ ]
agreement dated as of [ ],
200[ ] (the “Agreement”), among [IDENTIFY PARTIES]
I,
________________________________, the _______________________ of [NAME OF
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:
(1) 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] [Securities Administrator] [Trustee] pursuant to the Agreement
(collectively, the “Company Servicing Information”);
(2) 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;
(3) 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];
(4) 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
(5) 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
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: _________________________
By:
Name:
________________________________
Title:
________________________________
EXHIBIT
N
INTEREST
RATE SWAP AGREEMENT
 |
SWAP
TRANSACTION CONFIRMATION
|
|
|
|
|
Date:
|
August
30, 2006
|
|
To:
|
LaSalle
Bank National Association, not individually, but solely as Supplemental
Interest Trust Trustee on behalf of the Supplemental Interest
Trust (each as defined herein) with respect to SACO I Trust 2006-9,
Mortgage-Backed Certificates, Series 2006-9
|
|
Phone:
|
000-000-0000
|
|
Fax:
|
000-000-0000
|
|
Attention:
|
Global
Securities and Trust Services Group - SACO I Trust
2006-9
|
|
From:
|
Wachovia
Bank, N.A.
|
|
Ref.
No:
|
0000000
|
The
purpose of this letter agreement ("Agreement") is to confirm the terms and
conditions of the current Transaction entered into on the Trade Date specified
below (the "Transaction") between Wachovia Bank, N.A. ("Wachovia") and
LaSalle Bank National Association, not individually, but solely as trustee
(the
“Supplemental Interest Trust Trustee”) on behalf of the supplemental interest
trust with respect to the SACO I Trust 2006-9, Mortgage-Backed Certificates,
Series 2006-9 (the “Supplemental Interest Trust”) (“Counterparty”) created under
the Pooling and Servicing Agreement, dated as of August 1, 2006, among Bear
Xxxxxxx Asset Backed Securities I LLC, a Delaware limited liability company,
as
depositor (the “Depositor”), EMC Mortgage Corporation, a Delaware corporation,
as seller (in such capacity, the “Seller”) and as company (in such capacity, the
“Company”), LaSalle Bank National Association, a national banking association,
as master servicer (in such capacity, the “Master Servicer”) and as securities
administrator (in such capacity, the “Securities Administrator”), and Citibank,
N.A., a national banking association, as trustee (the “Trustee”) (the
“Pooling and Servicing Agreement”). This Agreement, which evidences a complete
and binding agreement between you and us to enter into the Transaction on
the
terms set forth below, constitutes a "Confirmation" as referred to in the
"ISDA
Form Master Agreement" (as defined below), as well as a “Schedule” as referred
to in the ISDA Form Master Agreement.
1. This
Agreement is subject to the 2000
ISDA Definitions (the
“Definitions”), as published by the International Swaps and Derivatives
Association, Inc. (“ISDA”). Any reference to a “Swap Transaction” in the
Definitions is deemed to be a reference to a “Transaction” for purposes of this
Agreement, and any reference to a “Transaction” in this Agreement is deemed to
be a reference to a “Swap Transaction” for purposes of the Definitions. You and
we have agreed to enter into this Agreement in lieu of negotiating a Schedule
to
the 1992 ISDA Master Agreement (Multicurrency—Cross Border) form (the "ISDA Form
Master Agreement"); rather, an ISDA Form Master Agreement with such elections
and modifications as set forth herein shall be deemed to have been executed
by
you and us on the date we entered into the Transaction, and this Agreement
shall
form part of, supplement and be subject to such ISDA Form Master Agreement.
For
the avoidance of doubt, the Transaction described herein shall be the sole
Transaction governed by such ISDA Form Master Agreement. Each term capitalized
but not defined herein or
in the Definitions
shall
have the meaning assigned thereto in the Pooling and Servicing Agreement.
In the
event of any inconsistency between the provisions of this Agreement and the
Definitions or the ISDA Form Master Agreement, this Agreement shall prevail
for
purposes of the Transaction. Each reference to a “Section” (unless specifically
referencing the Pooling and Servicing Agreement) or to a “Section” “of this
Agreement” will be construed as a reference to a Section of the ISDA Form Master
Agreement.
2. The
terms
of the particular Transaction to which this Confirmation relates are as
follows:
|
Type
of Transaction:
|
Interest
Rate Swap
|
|
Notional
Amount:
|
With
respect to any Calculation Period, the amount set forth for such
period on
Schedule I attached hereto.
|
|
Trade
Date:
|
August
16, 2006
|
|
Effective
Date:
|
August
30, 2006
|
|
Termination
Date:
|
May
25, 2010, subject to adjustment in accordance with the Business
Day
Convention; provided, however, that for the purpose of determining
the
final Fixed Rate Payer Period End Date, Termination Date shall
be subject
to No Adjustment.
|
Fixed
Amount:
|
Fixed
Rate Payer:
|
Counterparty
|
|
Fixed
Rate Payer
|
|
|
Period
End Dates:
|
The
25th
calendar day of each month during the Term of this Transaction,
commencing
September 25, 2006, and ending on the Termination Date, with No
Adjustment.
|
|
Fixed
Rate Payer
|
|
|
Payment
Dates:
|
Early
Payment shall be applicable. The Fixed Rate Payer Payment Date
shall be
one (1) Business Day preceding each Fixed Rate Payer Period End
Date.
|
|
Fixed
Rate:
|
5.265%
|
|
Fixed
Amount:
|
To
be determined in accordance with the following formula:
|
|
100*Fixed
Rate*Notional Amount*Fixed Rate Day Count
Fraction
|
Fixed
Rate Day
Count
Fraction: 30/360
Floating
Amounts:
|
Floating
Rate Payer:
|
Wachovia
|
|
Floating
Rate Payer
|
|
|
Period
End Dates:
|
The
25th
calendar day of each month during the Term of this Transaction,
commencing
September 25, 2006, and ending on the Termination Date, subject
to
adjustment in accordance with the Business Day
Convention.
|
|
Floating
Rate Payer
|
|
|
Payment
Dates:
|
Early
Payment shall be applicable. The Floating Rate Payer Payment Date
shall be
one (1) Business Day preceding each Floating Rate Payer Period
End
Date.
|
|
Floating
Rate Option:
|
USD-LIBOR-BBA
|
|
Floating
Amount:
|
To
be determined in accordance with the following formula:
|
|
100*Floating
Rate Option*Notional Amount*Floating Rate Day Count
Fraction
|
|
|
Designated
Maturity:
|
One
month
|
|
Floating
Rate Day
|
|
|
Count
Fraction:
|
Actual/360
|
|
Reset
Dates:
|
The
first day of each Calculation Period.
|
|
Compounding:
|
Inapplicable
|
|
Business
Days:
|
New York and Illinois
|
|
Business
Day Convention:
|
Following
|
|
Calculation
Agent:
|
Wachovia
|
|
3.
|
Provisions
Deemed Incorporated in a Schedule to the Master
Agreement:
|
Part
1. Termination
Provisions.
For
purposes of the Master Agreement:
(a) “Specified
Entity” is not applicable to Wachovia or Counterparty for any purpose.
(b) “Breach
of Agreement” provision of Section 5(a)(ii) will not apply to Wachovia or
Counterparty.
(c) “Credit
Support Default” provisions of Section 5(a)(iii) will apply to Wachovia (if
Wachovia enters into or delivers a Credit Support Document and posts collateral
or provides a guarantee or other contingent agreement pursuant to Part 5(h)
below), and will not apply to Counterparty.
(d) “Misrepresentation”
provisions of Section 5(a)(iv) will not apply to Wachovia or
Counterparty.
(e) “Specified
Transaction” is not applicable to Wachovia or Counterparty for any purpose, and,
accordingly, Section 5(a)(v) shall not apply to Wachovia or
Counterparty.
(f) The
“Cross Default” provisions of Section 5(a)(vi) will not apply to Wachovia or to
Counterparty.
(g) The
“Bankruptcy” provision of Section 5(a)(vii)(2) will not apply to
Counterparty.
(h) The
“Credit Event Upon Merger” provisions of Section 5(b)(iv) will not apply to
Wachovia or Counterparty.
(i) The
“Automatic Early Termination” provision of Section 6(a) will not apply to
Wachovia or to Counterparty.
(j) Payments
on Early Termination. For the purpose of Section 6(e) of this
Agreement:
(i) Market
Quotation will apply.
(ii) the
Second Method will apply.
(k) “Termination
Currency” means United States Dollars.
|
(l)
|
Gross
Up. The provisions of Section 2(d)(i)(4) and 2(d)(ii) of the printed
ISDA
Form Master Agreement shall not apply to Counterparty and Counterparty
shall not be required to pay any additional amounts referred to
therein.
|
Part
2. Tax
Representations.
|
(a)
Payer Representations. For the purpose of Section 3(e) of this
Agreement,
each of Wachovia and the Counterparty makes the following
representation:
|
|
It
is not required by any applicable law, as modified by the practice
of any
relevant governmental revenue authority, of any Relevant Jurisdiction
to
make any deduction or withholding for or on account of any Tax
from any
payment (other than interest under Section 2(e), 6(d)(ii) or 6(e)
of this
Agreement) to be made by it to the other party under this Agreement.
In
making this representation, it may rely on:
|
(i) the
accuracy of any representations made by the other party pursuant to Section
3(f)
of this Agreement;
(ii) the
satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) of
this
Agreement and the accuracy and effectiveness of any document provided by
the
other party pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement;
and
|
(iii) the satisfaction of the agreement of the other party contained
in
Section 4(d) of this Agreement, provided that it shall not be a
breach of
this representation where reliance is placed on clause (ii) and
the other
party does not deliver a form or document under Section 4(a)(iii)
by
reason of material prejudice to its legal or commercial position.
|
(b)
Payee
Representations. For the purpose of Section 3(f) of this Agreement:
(i) Party
A
makes the following representation(s):
(A) It
is a
national banking association organized or formed under the laws of the United
States and is a United States resident for United States federal income tax
purposes.
(B) Party
A
makes no other Payee Tax Representations.
|
(ii)
|
Party
B makes the following
representation(s):
|
(A) Party
B
is a common law trust formed under the laws of the State of New
York.
Part
3.
Agreement
to Deliver Documents. For
the
purpose of Section 4(a):
(1) Tax
forms, documents, or certificates to be delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
|
Wachovia
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form W-9
(or successor thereto), together with appropriate attachments,
that
eliminates U.S. federal withholding and backup withholding tax
on payments
to Wachovia under this Agreement.
|
(A)
before the first Payment Date under this Agreement, (B) promptly
upon
reasonable demand by the other party and (C) promptly upon learning
that
any such form previously provided by the party has become obsolete
or
incorrect.
|
|
Counterparty
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form W-9
(or successor thereto), together with appropriate attachments,
that
eliminates U.S. federal withholding and backup withholding tax
on payments
to Counterparty under this Agreement.
|
(A)
before the first Payment Date under this Agreement, (B) promptly
upon
reasonable demand by the other party and (C) promptly upon learning
that
any such form previously provided by the party has become obsolete
or
incorrect.
|
(2) Other
documents to be delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
Covered
by Section 3(d) Representation
|
|
|
Wachovia
and
the
Counterparty
|
Any
documents required by the receiving party to evidence the authority
of the
delivering party or its Credit Support Provider, if any, for it
to execute
and deliver this Agreement, any Confirmation , and any Credit Support
Documents to which it is a party, and to evidence the authority
of the
delivering party or its Credit Support Provider to perform its
obligations
under this Agreement, such Confirmation and/or Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement and such
Confirmation
|
Yes
|
|
|
Wachovia
and
the
Counterparty
|
A
certificate of an authorized officer of the party, as to the incumbency
and authority of the respective officers of the party signing this
Agreement, any relevant Credit Support Document, or any Confirmation,
as
the case may be
|
Upon
the execution and delivery of this Agreement and such
Confirmation
|
Yes
|
|
|
Wachovia
|
Annual
Report of Wachovia Corporation containing consolidated financial
statements certified by independent certified public accountants
and
prepared in accordance with generally accepted accounting principles
in
the country in which such party is organized
|
To
be made available on
xxxx://xxxxxxxx.xxx/xxxxxx/xxxx/0,,000_000_000,00.xxxx as soon
as
available and in any event within 90 days after the end of each
fiscal
year of Party A
|
Yes
|
|
|
Wachovia
|
Quarterly
Financial Statements of Wachovia Corporation containing unaudited,
consolidated financial statements of such party’s fiscal quarter prepared
in accordance with generally accepted accounting principles in
the country
in which such party is organized
|
To
be made available on
xxxx://xxxxxxxx.xxx/xxxxxx/xxxx/0,,000_000_000,00.xxxx as soon
as
available and in any event within 30 days after the end of each
fiscal
quarter of Party A
|
Yes
|
|
|
Wachovia
and the Counterparty
|
An
opinion of counsel with respect to the due authorization, execution
and
enforceability of this Agreement, acceptable to the other party
hereto.
|
Upon
the execution and delivery of this Agreement
|
Yes
|
Part
4.
Miscellaneous.
|
(a)
|
Address
for Notices: For the purposes of Section 12(a) of this
Agreement:
|
Address
for notices or communications to Wachovia:
Wachovia
Bank, National Association
000
Xxxxx
Xxxxxxx, XX-0
Xxxxxxxxx,
XX 00000-0000
Attention:
Xxxxx X. Xxxxx
Senior
Vice President, Risk Management
Fax:
(000) 000-0000
Phone:
(000) 000-0000
(For
all
purposes)
Address
for notices or communications to the Counterparty:
Address:
LaSalle Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
XX 00000
Attention:
Global Securities and Trust Services Group
SACO
I
Trust 2006-9
Facsimile:
000-000-0000
Phone:
000-000-0000
(For
all
purposes)
(b) Process
Agent. For the purpose of Section 13(c):
Wachovia
appoints as its
Process
Agent: Not
Applicable
Counterparty
appoints as its
Process
Agent:
Not
Applicable
(c) Offices.
The provisions of Section 10(a) will not apply to this Agreement; neither
Wachovia nor the Counterparty has any Offices other than as set forth in
the
Notices Section and Wachovia agrees that, for purposes of Section 6(b) of
this
Agreement, it shall not in future have any Office other than one in the United
States.
|
(d)
|
Multibranch
Party. For the purpose of Section 10(c) of this
Agreement:
|
Wachovia
is not a Multibranch Party.
|
Counterparty
is not a Multibranch Party.
|
(e) Credit
Support Document.
|
Wachovia:
|
None
or, in that event that Wachovia posts collateral under a Credit
Support
Annex or provides a guarantee or other contingent agreement pursuant
to
Part 5(h) below, such Credit Support Annex or guarantee or other
contingent agreement.
|
|
Counterparty:
|
Not
Applicable
|
|
(f)
|
Credit
Support Provider.
|
|
Wachovia:
|
None
or, in that event that Wachovia provides a guarantee or other contingent
agreement pursuant to Part 5(h) below, such guarantor or other
provider of
credit support.
|
|
Counterparty:
|
Not
Applicable
|
(g) Governing
Law. The parties to this Agreement hereby agree that the law of the State
of New
York shall govern their rights and duties in whole, without regard to the
conflict of law provisions thereof other than New York General Obligations
Law
Sections 5-1401 and 5-1402.
(h) Netting
of Payments. The parties agree that subparagraph (ii) of Section 2(c) of
the
ISDA Form Master Agreement will apply to any Transaction.
(i) “Affiliate”.
Counterparty shall be deemed not to have any Affiliates for purposes of this
Agreement.
Part
5.
Others
Provisions.
(a) Severability. If
any
term, provision, covenant, or condition of this Agreement, or the application
thereof to any party or circumstance, shall be held to be invalid or
unenforceable (in whole or in part) for any reason, the remaining terms,
provisions, covenants, and conditions hereof shall continue in full force
and
effect as if this Agreement had been executed with the invalid or unenforceable
portion eliminated, so long as this Agreement as so modified continues to
express, without material change, the original intentions of the parties
as to
the subject matter of this Agreement and the deletion of such portion of
this
Agreement will not substantially impair the respective benefits or expectations
of the parties; provided, however, that this severability provision shall
not be
applicable if any provision of Section 2, 5, 6, or 13 (or any definition
or
provision in Section 14 to the extent it relates to, or is used in or in
connection with any such Section) shall be so held to be invalid or
unenforceable.
The
parties shall endeavor to engage in good faith negotiations to replace any
invalid or unenforceable term, provision, covenant or condition with a valid
or
enforceable term, provision, covenant or condition, the economic effect of
which
comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
(b) Consent
to Recording. Each party hereto consents to the monitoring or recording,
at any
time and from time to time, by the other party of any and all communications
between officers or employees of the parties, waives any further notice of
such
monitoring or recording, and agrees to notify its officers and employees
of such
monitoring or recording.
(c) Waiver
of
Jury Trial. Each
party waives any right it may have to a trial by jury in respect of any
Proceedings relating to this Agreement or any Credit Support Document.
(d) Set-Off.
Notwithstanding any provision of this Agreement or any other existing or
future
agreement, each party irrevocably waives any and all rights it may have to
set
off, net, recoup or otherwise withhold or suspend or condition payment or
performance of any obligation between it and the other party hereunder against
any obligation between it and the other party under any other agreements;
provided that nothing herein shall be construed to waive or otherwise limit
the
netting provisions contained in Sections 2(c)(ii) or Section 6(e) of this
Agreement or the setoff rights contained in the Credit Support Annex. The
provisions for Set-off set forth in Section 6(e) of the ISDA Form Master
Agreement shall not apply for purposes of this Transaction.
(e) Additional
Definitional Provisions.
As
used
in this Agreement, the following terms shall have the meanings set forth
below,
unless the context clearly requires otherwise:
“Moody’s”
means Xxxxx’x Investors Service, Inc., or any successor.
“S&P”
means Standard & Poor's Ratings Services, or any successor.
(f) Supplemental
Interest Trust Trustee Liability Limitations. It is expressly understood
and
agreed by the parties hereto that (a) this Agreement is executed by LaSalle
Bank
National Association (“LaSalle”) not
in
its individual capacity, but solely as Supplemental Interest Trust Trustee
under
the Pooling and Servicing Agreement in the exercise of the powers and authority
conferred and invested in it thereunder; (b) LaSalle has been directed pursuant
to the Pooling and Servicing Agreement to enter into this Agreement and to
perform its obligations hereunder; (c) each of the representations, undertakings
and agreements herein made on behalf of the Trust is made and intended not
as
personal representations of the Trustee but is made and intended for the
purpose
of binding only the Trust; and (d) under no circumstances shall LaSalle
in its individual capacity be personally liable for any payments hereunder
or
for the breach or failure of any obligation, representation, warranty or
covenant made or undertaken under this Agreement.
(g)
Additional Termination Events. Additional Termination Events will apply:
(i)
If a
Rating Agency Downgrade has occurred and Wachovia has not complied with Part
5(h) below, then an Additional Termination Event shall have occurred with
respect to Wachovia and Wachovia shall be the sole Affected Party with respect
to such Additional Termination Event.
(ii)
If,
at any time, a mandatory redemption, auction call redemption, optional
redemption, tax redemption, clean-up call, termination upon liquidation or
repurchase in full of all mortgage loans or other prepayment in full or
repayment in full of all Certificates outstanding occurs under the Pooling
and
Servicing Agreement (or any notice is given to that effect and such notice
is
not capable of being rescinded), then an Additional Termination Event shall
have
occurred with respect to Counterparty and Counterparty shall be the sole
Affected Party with respect to such Additional Termination Event.; provided,
however, that notwithstanding Section 6(b)(iv) of the ISDA Form Master
Agreement, both Wachovia and Counterparty shall have the right to designate
an
Early Termination Date in respect of this Additional Termination Event;
provided, further, that the Early Termination Date in respect of this Additional
Termination Event shall not be prior to the final distribution date for the
Certificates.
(iii)
If,
upon the occurrence of a Swap Disclosure Event (as defined in Part 5(n) below)
Wachovia has not complied with any of the provisions set forth in clause
(iii)
of Part 5(n) below, then an Additional Termination Event shall have occurred
with respect to Wachovia and Wachovia shall be the sole Affected Party with
respect to such Additional Termination Event.
(iv)
If
the Trustee is unable to pay with respect to the Class A Certificates either
(i)
any related Current Interest or (ii) any amount in respect of principal required
to be paid pursuant to the terms of the Pooling and Servicing Agreement,
then an
Additional Termination Event shall have occurred with respect to Counterparty
and Counterparty shall be the sole Affected Party with respect to such
Additional Termination Event.
(v)
If
the Pooling and Servicing Agreement is amended in a manner which could have
a
material adverse effect on Wachovia without the prior written consent of
Wachovia, where such consent is required under the Pooling and Servicing
Agreement (such consent not to be unreasonably withheld), then an Additional
Termination Event shall have occurred with respect to Counterparty and
Counterparty shall be the sole Affected Party with respect to such Additional
Termination Event.
(h)
Rating Agency Downgrade. In the event that (i) Wachovia’s short-term unsecured
and unsubordinated debt rating is reduced below “A-1” by S&P, or if such
short-term debt rating is below “A-1” or Wachovia does not have a short-term
debt rating from S&P, Wachovia’s long-term unsecured and unsubordinated debt
rating is reduced below “A+” by S&P, or (ii) Wachovia’s long-term unsecured
and unsubordinated debt rating is reduced below “A1” by Moody’s or its
short-term unsecured and unsubordinated debt rating is reduced below “P1” by
Moody’s, or, in the event that Wachovia does not have a short-term rating from
Moody’s, if Wachovia’s long-term unsecured and unsubordinated debt rating is
reduced below “Aa3” by Moody’s (and together with S&P, the “Swap Rating
Agencies” and such rating thresholds, “Approved Rating Thresholds” and any such
reduction below the Approved Rating Thresholds, a “Collateral Rating Downgrade
Event”), then within 30 days after such Collateral Rating Downgrade Event by one
or more Swap Rating Agencies (unless, within 30 days after such Collateral
Rating Downgrade Event, each such Swap Rating Agency, as applicable, has
reconfirmed the rating of the SACO I Trust 2006-9, Mortgage-Backed Certificates,
Series 2006-9 (the
“Certificates”) and any notes backed by the Certificates (the “Notes”), which
was in effect immediately prior to such Collateral Rating Downgrade Event),
Wachovia shall, at its own expense, subject to the Rating Agency Condition,
either (i) seek another entity to replace Wachovia as party to this Agreement
that meets or exceeds the Approved Rating Thresholds on terms substantially
similar to this Agreement, (ii) obtain a guaranty of, or a contingent agreement
of another person with the Approved Rating Thresholds, to honor, Wachovia’s
obligations under this Agreement, or (iii) post collateral which will be
sufficient to restore the ratings of the Certificates and any Notes in effect
immediately prior to such Collateral Rating Downgrade Event (assuming for
this
purpose that no rating downgrade or withdrawal of the Certificates or Notes
unrelated to the Collateral Rating Downgrade Event has occurred since the
Collateral Rating Downgrade Event). In the event that Wachovia’s long-term
unsecured and unsubordinated debt rating is withdrawn or reduced below “BBB-” by
S&P (a “Required Rating Downgrade Event”), then within 10 Business Days
after such rating withdrawal or downgrade, Wachovia shall, subject to the
Rating
Agency Condition and at its own expense, either (i) secure another entity
to
replace Wachovia as party to this Agreement that meets or exceeds the Approved
Rating Thresholds on terms substantially similar to this Agreement or (ii)
obtain a guaranty of, or a contingent agreement of another person with the
Approved Rating Thresholds, to honor, Wachovia’s obligations under this
Agreement. For purposes of this provision, “Rating Agency Condition” means, with
respect to any particular proposed act or omission to act hereunder that
the
party acting or failing to act must consult with each of the Swap Rating
Agencies then providing a rating of the Certificates and any Notes and receive
from each of the Swap Rating Agencies a prior written confirmation that the
proposed action or inaction would not cause a downgrade or withdrawal of
the
then-current rating of any Certificates or Notes. For purposes of this
Agreement, the occurrence of either a Collateral Rating Downgrade Event or
a
Required Rating Downgrade Event may be referred to as a rating agency downgrade
(a “Rating Agency Downgrade”).
(i)
Payment Instructions. Wachovia hereby agrees that, unless notified in writing
by
the Supplemental Interest Trust Trustee of other payment instructions, any
and
all amounts payable by Wachovia to the Counterparty under this Agreement
shall
be paid to the Swap Administrator at the account specified in paragraph 4
below.
Wachovia shall be entitled to rely on any written notice or communication
from
the Supplemental Interest Trust Trustee to that effect which is delivered
to
Wachovia in accordance with Section 12 hereof.
(j)
Section 3 of the ISDA Form Master Agreement is hereby amended by adding at
the
end thereof the following subsection (g):
“(g) Relationship
Between Parties.
Each
party represents to the other party on each date when it enters into a
Transaction that:--
(1) Nonreliance.
(i) It
is not relying on any statement or representation of the other party regarding
the Transaction (whether written or oral), other than the representations
expressly made in this Agreement or the Confirmation in respect of that
Transaction and (ii) it has consulted with its own legal, regulatory, tax,
business, investment, financial and accounting advisors to the extent it
has
deemed necessary, and it has made its own investment, hedging and trading
decisions based upon its own judgment and upon any advice from such advisors
as
it has deemed necessary and not upon any view expressed by the other
party.
(2)
Evaluation
and Understanding.
(i)
It
has the capacity to evaluate (internally or through independent professional
advice) the Transaction and has made its own decision subject to Section
6(n) of
this Agreement to enter into the Transaction; and
(ii)
It
understands the terms, conditions and risks of the Transaction and is willing
and able to accept those terms and conditions and to assume those risks,
financially and otherwise.
(3)
Purpose.
It is
entering into the Transaction for the purposes of managing its borrowings
or
investments, hedging its underlying assets or liabilities or in connection
with
a line of business.
(4)
Status
of Parties.
The
other party is not acting as an agent, fiduciary or advisor for it in respect
of
the Transaction.
(5)
Eligible
Contract Participant.
It is
an “eligible swap participant” as such term is defined in Section 35.1(b)(2) of
the regulations (17 C.F.R. 35) promulgated under, and an “eligible contract
participant” as defined in Section 1(a)(12) of the Commodity Exchange Act, as
amended.”
(k)
Non-Recourse. Notwithstanding any provision herein or in the ISDA Form Master
Agreement to the contrary, the obligations of Counterparty hereunder are
limited
recourse obligations of Counterparty, payable solely from the Supplemental
Interest Trust, including the Derivative Account and the proceeds thereof,
in
accordance with the terms of the Pooling and Servicing Agreement. In the
event
that the Supplemental Interest Trust, including the Derivative Account and
the
proceeds thereof, should be insufficient to satisfy all claims outstanding
and
following the realization of the Derivative Account and the proceeds thereof,
any claims against or obligations of Counterparty under the ISDA Form Master
Agreement or any other confirmation thereunder still outstanding shall be
extinguished and thereafter not revive. The Supplemental Interest Trust Trustee
shall not have liability for any failure or delay in making a payment hereunder
to Wachovia due to any failure or delay in receiving amounts in the Derivative
Account from the Trust created pursuant to the Pooling and Servicing Agreement.
(l) Transfer,
Amendment and Assignment. No transfer, amendment, waiver, supplement, assignment
or other modification of this Agreement shall be permitted by either party
unless each of Moody’s and S&P has
been
provided prior notice of the same and confirms in writing (including by
facsimile transmission) that it will not downgrade, withdraw or otherwise
modify
its then-current ratings of any Certificates or Notes.
(m)
Proceedings. Wachovia shall not institute against, or cause any other person
to
institute against, or join any other person in instituting against Counterparty,
the Supplemental Interest Trust, or the trust formed pursuant to the Pooling
and
Servicing Agreement, any bankruptcy, reorganization, arrangement, insolvency
or
liquidation proceedings or other proceedings under any federal or state
bankruptcy or similar law for a period of one year (or, if longer, the
applicable preference period) and one day following payment in full of the
Certificates and any Notes; provided, that nothing herein shall preclude,
or be
deemed to estop, Wachovia from taking any action in any case or proceeding
voluntarily filed or commenced by or on behalf of Counterparty, the Supplemental
Interest Trust, or the trust formed pursuant to the Pooling and Servicing
Agreement by a party other than Wachovia or in any involuntary case or
proceeding after it has commenced. This provision will survive the termination
of this Agreement.
(n)
Compliance
with Regulation AB.
(i)
Wachovia agrees and acknowledges that Bear
Xxxxxxx Asset Backed Securities I LLC
(the
“Depositor”) may be required under Regulation AB, as defined in the Pooling and
Servicing Agreement, to disclose certain financial information regarding
Wachovia or its group of affiliated entities, if applicable, depending on
the
aggregate “significance percentage” of this Agreement and any other derivative
contracts between Wachovia or its group of affiliated entities, if applicable,
and Counterparty, as calculated from time to time in accordance with Item
1115
of Regulation AB.
(ii)
It
shall be a swap disclosure event (“Swap Disclosure Event”) if, on any Business
Day after the date hereof for so long as the Issuing Entity is required to
file
periodic reports under the Exchange Act with respect to the Certificates,
Counterparty or the Depositor requests from Wachovia the applicable financial
information described in Item 1115(b) of Regulation AB (such request to be
based
on a reasonable determination by the Depositor, based on "significance
estimates" made in substantially the same manner as that used in the Sponsor's
internal risk management process in respect of similar instruments and furnished
by the Sponsor to the Depositor, or if the Sponsor does not furnish such
significance estimates to the Depositor, based on a determination of such
significance estimates by the Depositor in a manner that it deems reasonable)
(the “Swap Financial Disclosure”).
(iii)
Upon the occurrence of a Swap Disclosure Event, Wachovia, at its own expense,
within ten (10) calendar days, shall either (1)(a) either (i) provide to
the
Depositor the current Swap Financial Disclosure in an XXXXX-compatible format
(for example, such information may be provided in Microsoft Word® or Microsoft
Excel® format but not in .pdf format) or (ii) provide written consent to the
Depositor to incorporation by reference of such current Swap Financial
Disclosure that are filed with the Securities and Exchange Commission in
the
Exchange Act Reports of the Depositor, (b) if applicable, cause its outside
accounting firm to provide its consent to filing or incorporation by reference
in the Exchange Act Reports of the Depositor of such accounting firm’s report
relating to their audits of such current Swap Financial Disclosure, and (c)
provide to the Depositor any updated Swap Financial Disclosure with respect
to
Wachovia or any entity that consolidates Wachovia within five days of the
release of any such updated Swap Financial Disclosure; (2) subject to the
Rating
Agency Condition, secure another entity to replace Wachovia as party to this
Agreement on terms substantially similar to this Agreement, which entity
(or a
guarantor therefor) meets or exceeds the Approved Rating Thresholds and which
entity complies with the requirements of Item 1115 of Regulation AB and clause
(1) above, (3) subject to the Rating Agency Condition, obtain a guaranty
of
Wachovia’s obligations under this Agreement from an affiliate of Wachovia that
complies with the financial information disclosure requirements of Item 1115
of
Regulation AB, and cause such affiliate to provide Swap Financial Disclosure
and
any future Swap Financial Disclosure and other information pursuant to clause
(1), such that disclosure provided in respect of such affiliate will satisfy
any
disclosure requirements applicable to the Swap Provider, or (4) transfer
Eligible Collateral to Counterparty's Custodian in an amount (taking into
account any amount posted pursuant to paragraph (o) of this Agreement, if
any)
which is sufficient, as reasonably determined in good faith by the Depositor,
to
reduce the aggregate significance percentage below 10% (or, so long as Wachovia
is able to provide the Swap Financial Disclosure required pursuant to Item
1115(b)(1) of Regulation AB, below 20%, in the event Wachovia is requested
to
provide the Swap Financial Disclosure required pursuant to Item 1115(b)(2)
of
Regulation AB).
(iv)
Third Party Beneficiary. Depositor shall be an express third party beneficiary
of this Agreement as if a party hereto to the extent of Depositor’s rights
explicitly specified herein.
(o)
The
ISDA Form Master Agreement is hereby amended as follows:
The
word
“third” shall be replaced by the word “first” in the third line of Section
5(a)(i) of the ISDA Form Master Agreement.
(p)
FDIC
Requirements. Party A represents that it is a bank subject to the requirements
of 12 U.S.C. § 1823(e), its execution, delivery and performance of this
Agreement (including the Credit Support Annex and each Confirmation) have
been
approved by its board of directors or its loan committee, such approval is
reflected in the minutes of said board of directors or loan committee, and
this
Agreement (including the Credit Support Annex and each Confirmation) will
be
maintained as one of its official records continuously from the time of its
execution (or in the case of any Confirmation, continuously until such time
as
the relevant Transaction matures and the obligations therefor are satisfied
in
full).
(q) Permitted
Transfer upon Tax Events. Notwithstanding Section 7 of this Agreement, at
any
time at which a Tax Event or Tax Event Upon Merger exists with respect to
Wachovia, Wachovia may, with prior written consent of Counterparty (such
consent
not to be unreasonably withheld) transfer, in whole but not in part, all
of its
rights and obligations under this Agreement in a transfer which meets all
of the
following requirements:
|
(A)
The transferee is a recognized dealer in interest rate swaps organized
under the laws of the United States of America or a jurisdiction
located
in the United States of America (or another jurisdiction reasonably
acceptable to Counterparty that, at the time of the transfer, maintains
(or its proposed guarantor maintains) the Approved Rating Thresholds
from
each Rating Agency;
|
(B)
The
Rating Agency Condition is satisfied with respect to such transfer;
(C)
Neither an Event of Default with respect to the transferee nor a Termination
Event would exist immediately after that transfer;
(D)
The
transferee executes and delivers a written agreement reasonably satisfactory
to
Counterparty in which the transferee, among other things, legally and
effectively accepts all the rights and assumes all the obligations of Wachovia
under this Agreement; and
(E)
As of
the date of such transfer neither the Transferee nor Counterparty will be
required to withhold or deduct on account of any Tax from any payments under
this Agreement in excess of what would have been required to be withheld
or
deducted in the absence of such transfer.
4. Account
Details and
Settlement
Information: Payments
to Wachovia:
Wachovia
Bank, N.A.
CIB
Group, ABA 05300219
Ref:
Derivative Desk (Trade No: 1555475 )
CIB
Group, ABA 000000000
Account
#: 04659360006116
Payments
to Counterparty:
Swap
Account
LaSalle
Bank
ABA
#
000000000
LaSalle
CHGO/CTR/BNF:/LaSalle Trust
Acct
#
724032.3
Attn:
Xxxxx X. Xxxxxx 000-000-0000
This
Agreement may be executed in several counterparts, each of which shall be
deemed
an original but all of which together shall constitute one and the same
instrument.
We
are
very pleased to have executed this Transaction with you and we look forward
to
completing other transactions with you in the near future.
Very
truly yours,
Wachovia
Bank, N.A.
|
By:
|
|
|
Name:
|
|
|
Title:
|
Counterparty,
acting through its duly authorized signatory, hereby agrees to, accepts and
confirms the terms of the foregoing as of the Trade Date.
LaSalle
Bank National Association, not individually, but solely as Supplemental Interest
Trust
Trustee
on behalf of the Supplemental Interest Trust with respect to SACO I Trust
2006-9
Mortgage-Backed
Certificates, Series 2006-9
|
By:
|
|
|
Name:
|
|
|
Title:
|
SCHEDULE
I
(all
such
dates subject to No Adjustment with respect to Fixed Payments and adjustment
in
accordance with the Following Business Day Convention with respect to Floating
Payments)
|
From
and including
|
To
but excluding
|
Notional
Amount (USD)
|
|
Effective
Date
|
9/25/2006
|
4,622,450.09
|
|
9/25/2006
|
10/25/2006
|
4,458,090.00
|
|
10/25/2006
|
11/25/2006
|
4,299,560.00
|
|
11/25/2006
|
12/25/2006
|
4,146,660.00
|
|
12/25/2006
|
1/25/2007
|
3,999,180.00
|
|
1/25/2007
|
2/25/2007
|
3,856,930.00
|
|
2/25/2007
|
3/25/2007
|
3,719,740.00
|
|
3/25/2007
|
4/25/2007
|
3,587,410.00
|
|
4/25/2007
|
5/25/2007
|
3,459,780.00
|
|
5/25/2007
|
6/25/2007
|
3,336,680.00
|
|
6/25/2007
|
7/25/2007
|
3,217,950.00
|
|
7/25/2007
|
8/25/2007
|
3,103,430.00
|
|
8/25/2007
|
9/25/2007
|
2,992,980.00
|
|
9/25/2007
|
10/25/2007
|
2,886,450.00
|
|
10/25/2007
|
11/25/2007
|
2,783,710.00
|
|
11/25/2007
|
12/25/2007
|
2,684,610.00
|
|
12/25/2007
|
1/25/2008
|
2,589,030.00
|
|
1/25/2008
|
2/25/2008
|
2,496,850.00
|
|
2/25/2008
|
3/25/2008
|
2,407,940.00
|
|
3/25/2008
|
4/25/2008
|
2,322,190.00
|
|
4/25/2008
|
5/25/2008
|
2,239,480.00
|
|
5/25/2008
|
6/25/2008
|
2,159,720.00
|
|
6/25/2008
|
7/25/2008
|
2,082,780.00
|
|
7/25/2008
|
8/25/2008
|
2,008,580.00
|
|
8/25/2008
|
9/25/2008
|
1,937,020.00
|
|
9/25/2008
|
10/25/2008
|
1,868,000.00
|
|
10/25/2008
|
11/25/2008
|
1,801,430.00
|
|
11/25/2008
|
12/25/2008
|
1,737,230.00
|
|
12/25/2008
|
1/25/2009
|
1,675,310.00
|
|
1/25/2009
|
2/25/2009
|
1,615,590.00
|
|
2/25/2009
|
3/25/2009
|
1,557,990.00
|
|
3/25/2009
|
4/25/2009
|
1,502,440.00
|
|
4/25/2009
|
5/25/2009
|
1,448,870.00
|
|
5/25/2009
|
6/25/2009
|
1,397,200.00
|
|
6/25/2009
|
7/25/2009
|
1,347,370.00
|
|
7/25/2009
|
8/25/2009
|
1,299,310.00
|
|
8/25/2009
|
9/25/2009
|
1,252,960.00
|
|
9/25/2009
|
10/25/2009
|
1,208,250.00
|
|
10/25/2009
|
11/25/2009
|
1,165,140.00
|
|
11/25/2009
|
12/25/2009
|
1,123,560.00
|
|
12/25/2009
|
1/25/2010
|
1,083,460.00
|
|
1/25/2010
|
2/25/2010
|
1,044,790.00
|
|
2/25/2010
|
3/25/2010
|
1,007,490.00
|
|
3/25/2010
|
4/25/2010
|
971,530.00
|
|
4/25/2010
|
Termination
Date
|
936,840.00
|
EXHIBIT
O
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
Definitions
Primary
Servicer - transaction party having borrower contact
Master
Servicer - aggregator of pool assets
Securities
Administrator - waterfall calculator
Back-up
Servicer - named in the transaction (in the event a Back up Servicer becomes
the
Primary Servicer, follow Primary Servicer obligations)
Custodian
- safe keeper of pool assets
Trustee
-
fiduciary of the transaction
Note:
The
definitions above describe the essential function that the party performs,
rather than the party’s title. So, for example, in a particular transaction, the
trustee may perform the “paying agent” and “securities administrator” functions,
while in another transaction, the securities administrator may perform these
functions.
Where
there are multiple checks for criteria the attesting party will identify
in
their management assertion that they are attesting only to the portion of
the
distribution chain they are responsible for in the related transaction
agreements.
Key: X
- obligation
|
Reg
AB Reference
|
Servicing
Criteria
|
Primary
Servicer
|
Master
Servicer
|
Securities
Admin
|
Custodian
|
Trustee
(nominal)
|
|
General
Servicing Considerations
|
||||||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
|
X
|
X
|
X
|
||
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
|
X
|
X
|
|||
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the Pool Assets 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.
|
X
|
X
|
|||
|
Cash
Collection and Administration
|
||||||
|
1122(d)(2)(i)
|
Payments
on pool assets are deposited into the appropriate custodial bank
accounts
and related bank clearing accounts no more than two business
days
following receipt, or such other number of days specified in
the
transaction agreements.
|
X
|
X
|
X
|
||
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
X
|
X
|
X
|
||
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are
made,
reviewed and approved as specified in the transaction agreements.
|
X
|
X
|
X
|
||
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of over collateralization, are
separately
maintained (e.g., with respect to commingling of cash) as set
forth in the
transaction agreements.
|
X
|
X
|
X
|
||
|
1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institution” with respect to
a foreign financial institution means a foreign financial institution
that
meets the requirements of Rule 13k-1(b)(1) of the Securities
Exchange Act.
|
X
|
X
|
X
|
||
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized access.
|
X
|
||||
|
1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities
related
bank accounts, including custodial accounts and related bank
clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliation; and (D) contain explanations for reconciling
items. These
reconciling items are resolved within 90 calendar days of their
original
identification, or such other number of days specified in the
transaction
agreements.
|
X
|
X
|
X
|
||
|
Investor
Remittances and Reporting
|
||||||
|
1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission,
are
maintained in accordance with the transaction agreements and
applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance
with the
terms specified in the transaction agreements; (C) are filed
with the
Commission as required by its rules and regulations; and (D)
agree with
investors’ or the trustee’s records as to the total unpaid principal
balance and number of Pool Assets serviced by the Servicer.
|
X
|
X
|
X
|
||
|
1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with
timeframes,
distribution priority and other terms set forth in the transaction
agreements.
|
X
|
X
|
X
|
||
|
1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the
Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
|
X
|
X
|
X
|
||
|
1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank statements.
|
X
|
X
|
X
|
||
|
Pool
Asset Administration
|
||||||
|
1122(d)(4)(i)
|
Collateral
or security on pool assets is maintained as required by the transaction
agreements or related pool asset documents.
|
X
|
X
|
|||
|
1122(d)(4)(ii)
|
Pool
assets and related documents are safeguarded as required by the
transaction agreements
|
X
|
X
|
|||
|
1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements
in the
transaction agreements.
|
X
|
X
|
X
|
X1 (only
with respect to LaSalle as Custodian)
|
|
|
1122(d)(4)(iv)
|
Payments
on pool assets, including any payoffs, made in accordance with
the related
pool asset 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 pool asset documents.
|
X
|
||||
|
1122(d)(4)(v)
|
The
Servicer’s records regarding the pool assets agree with the Servicer’s
records with respect to an obligor’s unpaid principal balance.
|
X
|
||||
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor's pool assets
(e.g.,
loan modifications or re-agings) are made, reviewed and approved
by
authorized personnel in accordance with the transaction agreements
and
related pool asset documents.
|
X
|
X
|
|||
|
1122(d)(4)(vii)
|
Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
and
deeds in lieu of foreclosure, foreclosures and repossessions,
as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
agreements.
|
X
|
X
|
|||
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period
a pool
asset 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 pool assets including, for
example,
phone calls, letters and payment rescheduling plans in cases
where
delinquency is deemed temporary (e.g., illness or unemployment).
|
X
|
||||
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for pool assets with variable
rates
are computed based on the related pool asset documents.
|
X
|
X
|
|||
|
1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts):
(A) such
funds are analyzed, in accordance with the obligor’s pool asset 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 pool asset documents
and state
laws; and (C) such funds are returned to the obligor within 30
calendar
days of full repayment of the related pool assets, or such other
number of
days specified in the transaction agreements.
|
X
|
||||
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax or insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that
such support
has been received by the servicer at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
X
|
||||
|
1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the Servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
X
|
||||
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of
days
specified in the transaction agreements.
|
X
|
||||
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
X
|
X
|
|||
|
1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set
forth in
the transaction agreements.
|
X
|
X
|
1
Only with respect to the logistics
of adding,
removing or substituting loan files.
EXHIBIT
P
FORM
10-D, FORM 8-K AND FORM 10-K
REPORTING
RESPONSIBILITY
As
to
each item described below, the entity indicated as the Responsible Party
shall
be primarily responsible for reporting the information to the party identified
as responsible for preparing the Securities Exchange Act Reports pursuant
to
Section 3.18 of the Pooling and Servicing Agreement.
Under
Item 1 of Form 10-D: a) items marked “monthly statements to certificateholders”
are required to be included in the periodic Distribution Date statement under
Section 6.06 of the Pooling and Servicing Agreement, provided by the Securities
Administrator based on information received from the party providing such
information to the Securities Administrator; and b) items marked “Form 10-D
report” are required to be in the Form 10-D report but not the monthly
statements to certificateholders, provided by the party indicated. Information
under all other Items of Form 10-D is to be included in the Form 10-D report.
All such information and any other Items of Form 8-K and Form 10-K set forth
in
this exhibit shall be sent to the Securities Administrator and the
Depositor.
|
Form
|
Item
|
Description
|
Servicers
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
(nominal)
|
Depositor
|
Sponsor
|
|
10-D
|
Must
be filed within 15 days of the distribution date for the asset-backed
securities.
|
||||||||
|
1
|
Distribution
and Pool Performance Information
|
||||||||
|
Item
1121(a) - Distribution and Pool Performance
Information
|
|||||||||
|
(1)
Any applicable record dates, accrual dates, determination dates
for
calculating distributions and actual distribution dates for the
distribution period.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(2)
Cash flows received and the sources thereof for distributions,
fees and
expenses.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(3)
Calculated amounts and distribution of the flow of funds for
the period
itemized by type and priority of payment, including:
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(i)
Fees or expenses accrued and paid, with an identification of
the general
purpose of such fees and the party receiving such fees or
expenses.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(ii)
Payments accrued or paid with respect to enhancement or other
support
identified in Item 1114 of Regulation AB (such as insurance premiums
or
other enhancement maintenance fees), with an identification of
the general
purpose of such payments and the party receiving such
payments.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(iii)
Principal, interest and other distributions accrued and paid
on the
asset-backed securities by type and by class or series and any
principal
or interest shortfalls or carryovers.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(iv)
The amount of excess cash flow or excess spread and the disposition
of
excess cash flow.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(4)
Beginning and ending principal balances of the asset-backed
securities.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(5)
Interest rates applicable to the pool assets and the asset-backed
securities, as applicable. Consider providing interest rate information
for pool assets in appropriate distributional groups or incremental
ranges.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(6)
Beginning and ending balances of transaction accounts, such as
reserve
accounts, and material account activity during the period.
|
X
(monthly
statements to certificateholders)
(only
with respect to reserve accounts)
|
||||||||
|
(7)
Any amounts drawn on any credit enhancement or other support
identified in
Item 1114 of Regulation AB, as applicable, and the amount of
coverage
remaining under any such enhancement, if known and
applicable.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(8)
Number and amount of pool assets at the beginning and ending
of each
period, and updated pool composition information, such as weighted
average
coupon, weighted average remaining term, pool factors and prepayment
amounts.
|
X
(monthly
statements to certificateholders)
|
Updated
pool composition information fields to be as specified by Depositor
from
time to time
|
|||||||
|
(9)
Delinquency and loss information for the period.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
In
addition, describe any material changes to the information specified
in
Item 1100(b)(5) of Regulation AB regarding the pool assets.
(methodology)
|
X
|
X
|
|||||||
|
(10)
Information on the amount, terms and general purpose of any advances
made
or reimbursed during the period, including the general use of
funds
advanced and the general source of funds for
reimbursements.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(11)
Any material modifications, extensions or waivers to pool asset
terms,
fees, penalties or payments during the distribution period or
that have
cumulatively become material over time.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(12)
Material breaches of pool asset representations or warranties
or
transaction covenants.
|
X
|
X
|
X
(if
agreed upon by the parties)
|
X
|
|||||
|
(13)
Information on ratio, coverage or other tests used for determining
any
early amortization, liquidation or other performance trigger
and whether
the trigger was met.
|
X
(monthly
statements to certificateholders)
|
||||||||
|
(14)
Information regarding any new issuance of asset-backed securities
backed
by the same asset pool,
|
X
|
||||||||
|
information
regarding any pool asset changes (other than in connection with
a pool
asset converting into cash in accordance with its terms), such
as
additions or removals in connection with a prefunding or revolving
period
and pool asset substitutions and repurchases (and purchase rates,
if
applicable), and cash flows available for future purchases, such
as the
balances of any prefunding or revolving accounts, if
applicable.
|
X
|
X
|
X
|
X
|
|||||
|
Disclose
any material changes in the solicitation, credit-granting, underwriting,
origination, acquisition or pool selection criteria or procedures,
as
applicable, used to originate, acquire or select the new pool
assets.
|
X
|
X
|
|||||||
|
Item
1121(b) - Pre-Funding or Revolving Period Information
Updated
pool information as required under Item 1121(b).
|
X
|
||||||||
|
2
|
Legal
Proceedings
|
||||||||
|
Item
1117 - Legal proceedings pending against the following entities,
or their
respective property, that is material to Certificateholders,
including
proceedings known to be contemplated by governmental
authorities:
|
|||||||||
|
Sponsor
(Seller)
|
X
|
||||||||
|
Depositor
|
X
|
||||||||
|
Trustee
|
|||||||||
|
Issuing
entity
|
X
|
||||||||
|
Master
Servicer, affiliated Servicer, other Servicer servicing 20% or
more of
pool assets at time of report, other material servicers
|
X
|
X
|
|||||||
|
Securities
Administrator
|
X
|
||||||||
|
Originator
of 20% or more of pool assets as of the Cut-off Date
|
X
|
||||||||
|
Custodian
|
X
|
||||||||
|
3
|
Sales
of Securities and Use of Proceeds
|
||||||||
|
Information
from Item 2(a) of Part II of Form 10-Q:
With
respect to any sale of securities by the sponsor, depositor or
issuing
entity, that are backed by the same asset pool or are otherwise
issued by
the issuing entity, whether or not registered, provide the sales
and use
of proceeds information in Item 701 of Regulation S-K. Pricing
information
can be omitted if securities were not registered.
|
X
|
||||||||
|
4
|
Defaults
Upon Senior Securities
|
||||||||
|
Information
from Item 3 of Part II of Form 10-Q:
Report
the occurrence of any Event of Default (after expiration of any
grace
period and provision of any required notice)
|
X
(only
with respect to any servicer event of default)
|
||||||||
|
5
|
Submission
of Matters to a Vote of Certificateholders
|
||||||||
|
Information
from Item 4 of Part II of Form 10-Q
|
X
|
||||||||
|
6
|
Significant
Obligors of Pool Assets
|
||||||||
|
Item
1112(b) - Significant
Obligor Financial Information*
|
X
|
||||||||
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Item.
|
|||||||||
|
7
|
Significant
Enhancement Provider Information
|
||||||||
|
Item
1114(b)(2) - Credit Enhancement Provider Financial
Information*
|
|||||||||
|
Determining
applicable disclosure threshold
|
X
|
||||||||
|
Requesting
required financial information or effecting incorporation by
reference
|
X
|
||||||||
|
Item
1115(b) - Derivative Counterparty Financial
Information*
|
|||||||||
|
Determining
current maximum probable exposure
|
X
|
||||||||
|
Determining
current significance percentage
|
X
|
||||||||
|
Requesting
required financial information or effecting incorporation by
reference
|
X
|
||||||||
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Items.
|
|||||||||
|
8
|
Other
Information
|
||||||||
|
Disclose
any information required to be reported on Form 8-K during the
period
covered by the Form 10-D but not reported
|
The
Responsible Party for the applicable Form 8-K item as indicated
below.
|
||||||||
|
9
|
Exhibits
|
||||||||
|
Distribution
report
|
X
|
||||||||
|
Exhibits
required by Item 601 of Regulation S-K, such as material
agreements
|
X
|
||||||||
|
8-K
|
Must
be filed within four business days of an event reportable on
Form
8-K.
|
||||||||
|
1.01
|
Entry
into a Material Definitive Agreement
|
||||||||
|
Disclosure
is required regarding entry into or amendment of any definitive
agreement
that is material to the securitization, even if depositor is
not a
party.
Examples:
servicing agreement, custodial agreement.
Note:
disclosure not required as to definitive agreements that are
fully
disclosed in the prospectus
|
X
|
X
|
X
|
X
|
X
|
||||
|
1.02
|
Termination
of a Material Definitive Agreement
|
X
|
X
|
X
|
X
|
X
|
|||
|
Disclosure
is required regarding termination of any definitive agreement
that is
material to the securitization (other than expiration in accordance
with
its terms), even if depositor is not a party.
Examples:
servicing agreement, custodial agreement.
|
|||||||||
|
1.03
|
Bankruptcy
or Receivership
|
||||||||
|
Disclosure
is required regarding the bankruptcy or receivership, if known
to the
Master Servicer, with respect to any of the following:
Sponsor
(Seller), Depositor, Master Servicer, affiliated Servicer, other
Servicer
servicing 20% or more of pool assets at time of report, other
material
servicers, Securities Administrator, Trustee, significant obligor,
credit
enhancer (10% or more), derivatives counterparty,
Custodian
|
X
|
X
|
X
|
X
|
X
|
X
|
|||
|
2.04
|
Triggering
Events that Accelerate or Increase a Direct Financial Obligation
or an
Obligation under an Off-Balance Sheet Arrangement
[in
this transaction there is no off-balance sheet
arrangement]
|
||||||||
|
Includes
an early amortization, performance trigger or other event, including
event
of default, that would materially alter the payment priority/distribution
of cash flows/amortization schedule.
Disclosure
will be made of events other than waterfall triggers which are
disclosed
in the monthly statements to certificateholders.
[in
this transaction there will be no events other than waterfall
triggers]
|
X
|
||||||||
|
3.03
|
Material
Modification to Rights of Certificateholders
|
||||||||
|
Disclosure
is required of any material modification to documents defining
the rights
of Certificateholders, including the Pooling and Servicing
Agreement
|
X
|
X
|
|||||||
|
5.03
|
Amendments
to Articles of Incorporation or Bylaws; Change in Fiscal
Year
|
||||||||
|
Disclosure
is required of any amendment “to the governing documents of the issuing
entity”
|
X
|
||||||||
|
5.06
|
Change
in Shell Company Status
|
||||||||
|
[Not
applicable to ABS issuers]
|
X
|
||||||||
|
6.01
|
ABS
Informational and Computational Material
|
||||||||
|
[Not
included in reports to be filed under Section 3.18]
|
X
|
||||||||
|
6.02
|
Change
of Servicer or Trustee
|
||||||||
|
Requires
disclosure of any removal, replacement, substitution or addition
of any
master servicer, affiliated servicer, other servicer servicing
10% or more
of pool assets at time of report, other material servicers, securities
administrator or trustee.
|
X
|
X
|
X
|
X
|
|||||
|
Reg
AB disclosure about any new servicer is also required.
|
X
|
||||||||
|
Reg
AB disclosure about any new trustee is also required.
|
X (to
the extent required by successor trustee)
|
||||||||
|
Reg
AB disclosure about any new securities administrator is also
required.
|
X
|
||||||||
|
6.03
|
Change
in Credit Enhancement or Other External Support
|
||||||||
|
Covers
termination of any enhancement in manner other than by its terms,
the
addition of an enhancement, or a material change in the enhancement
provided. Applies to external credit enhancements as well as
derivatives.
|
X
|
X
|
|||||||
|
Reg
AB disclosure about any new enhancement provider is also
required.
|
X
|
X
|
|||||||
|
6.04
|
Failure
to Make a Required Distribution
|
X
|
|||||||
|
6.05
|
Securities
Act Updating Disclosure
|
||||||||
|
If
any material pool characteristic differs by 5% or more at the
time of
issuance of the securities from the description in the final
prospectus,
provide updated Reg AB disclosure about the actual asset
pool.
|
X
|
|
|||||||
|
If
there are any new servicers or originators required to be disclosed
under
Regulation AB as a result of the foregoing, provide the information
called
for in Items 1108 and 1110 respectively.
|
X
|
||||||||
|
7.01
|
Regulation
FD Disclosure
|
X
|
X
|
X
|
X
|
X
|
|||
|
8.01
|
Other
Events
|
||||||||
|
Any
event, with respect to which information is not otherwise called
for in
Form 8-K, that the registrant deems of importance to
Certificateholders.
|
X
|
||||||||
|
9.01
|
Financial
Statements and Exhibits
|
The
Responsible Party applicable to reportable event.
|
|||||||
|
10-K
|
Must
be filed within 90 days of the fiscal year end for the
registrant.
|
||||||||
|
9B
|
Other
Information
|
||||||||
|
Disclose
any information required to be reported on Form 8-K during the
fourth
quarter covered by the Form 10-K but not reported
|
The
Responsible Party for the applicable Form 8-K Item as indicated
above.
|
||||||||
|
15
|
Exhibits
and Financial Statement Schedules
|
||||||||
|
Item
1112(b) - Significant
Obligor Financial Information
|
X
|
||||||||
|
Item
1114(b)(2) - Credit Enhancement Provider Financial
Information
|
|||||||||
|
Determining
applicable disclosure threshold
|
X
|
||||||||
|
Requesting
required financial information or effecting incorporation by
reference
|
X
|
||||||||
|
Item
1115(b) - Derivative Counterparty Financial
Information
|
|||||||||
|
Determining
current maximum probable exposure
|
X
|
||||||||
|
Determining
current significance percentage
|
X
|
||||||||
|
Requesting
required financial information or effecting incorporation by
reference
|
X
|
||||||||
|
Item
1117 - Legal proceedings pending against the following entities,
or their
respective property, that is material to Certificateholders,
including
proceedings known to be contemplated by governmental
authorities:
|
|||||||||
|
Sponsor
(Seller)
|
X
|
||||||||
|
Depositor
|
X
|
||||||||
|
Trustee
|
|||||||||
|
Issuing
entity
|
X
|
||||||||
|
Master
Servicer, affiliated Servicer, other Servicer servicing 20% or
more of
pool assets at time of report, other material servicers
|
X
|
X
|
|||||||
|
Securities
Administrator
|
X
|
||||||||
|
Originator
of 20% or more of pool assets as of the Cut-off Date
|
X
|
||||||||
|
Custodian
|
X
|
||||||||
|
Item
1119 - Affiliations and relationships between the following entities,
or
their respective affiliates, that are material to
Certificateholders:
|
|||||||||
|
Sponsor
(Seller)
|
X
|
||||||||
|
Depositor
|
X
|
||||||||
|
Trustee
|
|||||||||
|
Master
Servicer, affiliated Servicer, other Servicer servicing 20% or
more of
pool assets at time of report, other material servicers
|
X
|
X
|
|||||||
|
Securities
Administrator
|
X
|
||||||||
|
Originator
|
X
|
||||||||
|
Custodian
|
X
|
||||||||
|
Credit
Enhancer/Support Provider
|
X
|
||||||||
|
Significant
Obligor
|
X
|
||||||||
|
Item
1122 - Assessment of Compliance with Servicing
Criteria
|
X
|
X
|
X
|
X
|
|||||
|
Item
1123 - Servicer Compliance Statement
|
X
|
X
|
X
|
||||||
EXHIBIT
Q
ADDITIONAL
DISCLOSURE NOTIFICATION
Bear
Xxxxxxx Asset Backed Securities I LLC
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Fax:
(000) 000-0000
E-mail:
xxxxxxxxxxxxxxxxxx@xxxx.xxx
LaSalle
Bank National Association as Securities Administrator
000
X.
XxXxxxx Xx., Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Fax:
(000) 000-0000
E-mail:
xxxxx@xxxxxxx.xxx
Attn:
Global Securities and Trust Services Group - SACO I TRUST 2006-9 - SEC REPORT
PROCESSING
RE:
**Additional Form [ ]
Disclosure**Required
Ladies
and Gentlemen:
In
accordance with Section 3.18 of the Pooling and Servicing Agreement, dated
as of
August 1, 2006, among Bear Xxxxxxx Asset Backed Securities I LLC, as depositor,
EMC Mortgage Corporation, as Seller and as company, LaSalle Bank National
Association, as master servicer and as securities administrator, and Citibank,
N.A., as trustee. The Undersigned, as [Name of Party], hereby notifies you
that
certain events have come to our attention that [will][may] need to be disclosed
on Form [ ].
Description
of Additional Form [ ]
Disclosure:
List
of
Any Attachments hereto to be included in the Additional Form [ ]
Disclosure:
Any
inquiries related to this notification should be directed to [ ], phone
number: [ ]; email address:
[
].
|
[NAME
OF PARTY],
as
[role]
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
EXHIBIT
R-1
FORM
OF
FIRST TENNESSEE SERVICING AGREEMENT
EMC
MORTGAGE CORPORATION
Purchaser,
FIRST
TENNESSEE MORTGAGE SERVICES, INC.
Servicer,
FIRST
HORIZON HOME LOAN CORPORATION
Seller,
PURCHASE,
WARRANTIES AND SERVICING AGREEMENT
Dated
as
of September 1, 2003
(Fixed
and Adjustable Rate Mortgage Loans)
TABLE
OF CONTENTS
ARTICLE
I
Section
1.01 Defined Terms2
ARTICLE
II
Section
2.01 Agreement to Purchase
Section
2.02 Purchase Price
Section
2.03 Servicing of Mortgage Loans
Section
2.04 Record Title and Possession of Mortgage Files; Maintenance
of Servicing Files
Section
2.05 Books and Records
Section
2.06 Transfer of Mortgage Loans
Section
2.07 Delivery of Mortgage Loan Documents
Section
2.08 Quality Control Procedures
Section
2.09 Near-term Principal Prepayments; Near Term Payment Defaults
Section
2.10 Modification of Obligations
ARTICLE
III
Section
3.01 Representations and Warranties of the Company
Section
3.02 Representations and Warranties as to Individual
Mortgage Loans
Section
3.03 Repurchase; Substitution
Section
3.04 Representations and Warranties of the Purchaser
ARTICLE
IV
Section
4.01 Company to Act as Servicer
Section
4.02 Collection of Mortgage Loan Payments
Section
4.03 Realization Upon Defaulted Mortgage Loans
Section
4.04 Establishment of Custodial Accounts; Deposits
in Custodial Accounts
Section
4.05 Permitted Withdrawals from the Custodial
Account
Section
4.06 Establishment of Escrow Accounts; Deposits
in Escrow Accounts
Section
4.07 Permitted Withdrawals From Escrow Account
Section
4.08 Payment of Taxes, Insurance and Other Charges;
Maintenance of Primary Mortgage Insurance
Policies; Collections Thereunder
Section
4.09 Transfer of Accounts
Section
4.10 Maintenance of Hazard Insurance
Section
4.11 Maintenance of Mortgage Impairment Insurance
Policy
Section
4.12 Fidelity Bond, Errors and Omissions Insurance
Section
4.13 Title, Management and Disposition of REO Property
Section
4.14 Notification of Maturity Date
ARTICLE
V
Section
5.01 Distributions
Section
5.02 Statements to the Purchaser
Section
5.03 Monthly Advances by the Company
Section
5.04 Liquidation Reports
ARTICLE
VI
Section
6.01 Assumption Agreements
Section
6.02 Satisfaction of Mortgages and Release of Mortgage Files
Section
6.03 Servicing Compensation
Section
6.04 Annual Statement as to Compliance
Section
6.05 Annual Independent Certified Public Accountants’ Servicing
Report
Section
6.06 Purchaser’s Right to Examine Company Records
ARTICLE
VII
Section
7.01 Company Shall Provide Information as Reasonably Required
ARTICLE
VIII
Section
8.01 Indemnification; Third Party Claims
Section
8.02 Merger or Consolidation of the Company
Section
8.03 Limitation on Liability of the Company and Others
Section
8.04 Company Not to Assign or Resign
Section
8.05 No Transfer of Servicing
ARTICLE
IX
Section
9.01 Events of Default
Section
9.02 Waiver of Defaults
ARTICLE
X
Section
10.01 Termination
Section
10.02 Termination without cause
ARTICLE
XI
Section
11.01 Successor to the Company
Section
11.02 Amendment
Section
11.03 Recordation of Agreement
Section
11.04 Governing Law
Section
11.05 Notices
Section
11.06 Severability of Provisions
Section
11.07 Exhibits
Section
11.08 General Interpretive Principles
Section
11.09 Reproduction of Documents
Section
11.10 Confidentiality of Information
Section
11.11 Recordation of Assignment of Mortgage
Section
11.12 Assignment by Purchaser
Section
11.13 No Partnership
Section
11.14 Execution: Successors and Assigns
Section
11.15 Entire Agreement
Section
11.16 No Solicitation
Section
11.17 Closing
Section
11.18 Cooperation of Company with Reconstitution
EXHIBITS
| A |
Contents
of Mortgage File
|
| B |
Custodial
Account Letter Agreement
|
| C |
Escrow
Account Letter Agreement
|
| D |
Form
of Assignment, Assumption and Recognition
Agreement
|
| E |
Form
of Trial Balance
|
| F |
[reserved]
|
| G |
Request
for Release of Documents and
Receipt
|
| H |
Company’s
Underwriting Guidelines
|
| I |
Form
of Term Sheet
|
This
is a
Purchase, Warranties and Servicing Agreement, dated as of September 1,
2003 and
is executed among EMC MORTGAGE CORPORATION, as Purchaser, with offices
located
at Mac Xxxxxx Xxxxx XX, 000 Xxxxxx Xxxxx Xxxxx, Xxxxx 000, Xxxxxx, Xxxxx
00000
(the "Purchaser"), FIRST TENNESSEE MORTGAGE SERVICES, INC., as servicer
(the
“Servicer”) with offices located at 0000
Xxxxxxx Xxx, Xxxxxx, Xxxxx 00000 and FIRST HORIZON HOME LOAN CORPORATION,
as
seller (the “Seller”) with offices located at 0000 Xxxxxxx Xxx, Xxxxxx, Xxxxx
00000 (the Servicer and the Seller together referred to as the
"Company").
W I T N E S S E T H
:
WHEREAS,
the Purchaser has heretofore agreed to purchase from the Company and the
Company
has heretofore agreed to sell to the Purchaser, from time to time, certain
Mortgage Loans on a servicing retained basis;
WHEREAS,
each of the Mortgage Loans is secured by a mortgage, deed of trust or other
security instrument creating a first lien on a residential dwelling located
in
the jurisdiction indicated on the Mortgage Loan Schedule, which is annexed
to
the related Term Sheet; and
WHEREAS,
the Purchaser and the Company wish to prescribe the representations and
warranties of the Company with respect to itself and the Mortgage Loans
and the
management, servicing and control of the Mortgage Loans;
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of
which is
hereby acknowledged, the Purchaser and the Company agree as
follows:
ARTICLE
I
DEFINITIONS
Section
1.01 Defined
Terms.
Whenever
used in this Agreement, the following words and phrases, unless the context
otherwise requires, shall have the following meaning specified in this
Article:
Accepted
Servicing Practices:
With
respect to any Mortgage Loan, those mortgage servicing practices (including
collection procedures) of prudent mortgage banking institutions which service
mortgage loans of the same type as such Mortgage Loan in the jurisdiction
where
the related Mortgaged Property is located, and which are in accordance
with
Xxxxxx Mae servicing practices and procedures, for MBS pool mortgages,
as
defined in the Xxxxxx Xxx Guides including future updates.
Adjustment
Date:
As to
each adjustable rate Mortgage Loan, the date on which the Mortgage Interest
Rate
is adjusted in accordance with the terms of the related Mortgage
Note.
Agreement:
This
Purchase, Warranties and Servicing Agreement including all exhibits hereto,
amendments hereof and supplements hereto.
Appraised
Value:
With
respect to any Mortgaged Property, the value thereof as determined by an
appraisal made for the originator of the Mortgage Loan at the time of
origination of the Mortgage Loan by an appraiser who met the requirements
of the
Company and Xxxxxx Mae.
Assignment:
An
individual assignment of the Mortgage, notice of transfer or equivalent
instrument, in recordable form, sufficient under the laws of the jurisdiction
wherein the related Mortgaged Property is located to reflect of record
the sale
or transfer of the Mortgage Loan.
BIF:
The
Bank Insurance Fund, or any successor thereto.
Business
Day:
Any day
other than: (i) a Saturday or Sunday, or (ii) a legal holiday in the State
of
New York or State of Texas, or (iii) a day on which banks in the State
of New
York or State of Texas are authorized or obligated by law or executive
order to
be closed.
Closing
Date:
With
respect to any Mortgage Loan, the date stated on the related Term Sheet.
Code: The
Internal Revenue Code of 1986, or any successor statute thereto.
Company:
Reference
to the Seller and Servicer.
Company's
Officer's Certificate:
A
certificate signed by the Chairman of the Board, President, any Vice President
or Treasurer of Company stating the date by which Company expects to receive
any
missing documents sent for recording from the applicable recording
office.
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.
Confirmation:
The
trade confirmation letter between the Purchaser and the Company which relates
to
the Mortgage Loans.
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.
Current
Appraised Value: With
respect to any Mortgaged Property, the value thereof as determined by an
appraisal made for the Company (by an appraiser who met the requirements
of the
Company and Xxxxxx Xxx) at the request of a Mortgagor for the purpose of
canceling a Primary Mortgage Insurance Policy in accordance with federal,
state
and local laws and regulations or otherwise made at the request of the
Company
or Mortgagor.
Current
LTV: The
ratio
of the Stated Principal Balance of a Mortgage Loan to the Current Appraised
Value of the Mortgaged Property.
Custodial
Account:
Each
separate demand account or accounts created and maintained pursuant to
Section
4.04 which shall be entitled "[_____________________], in trust for the
[Purchaser], Owner of Adjustable Rate Mortgage Loans" and shall be established
in an Eligible Account, in the name of the Person that is the "Purchaser"
with
respect to the related Mortgage Loans.
Custodian:
With
respect to any Mortgage Loan, the entity stated on the related Term Sheet,
and
its successors and assigns, as custodian for the Purchaser.
Cut-off
Date:
With
respect to any Mortgage Loan, the date stated on the related Term Sheet.
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.
Due
Date:
The day
of the month on which the Monthly Payment is due on a Mortgage Loan, exclusive
of any days of grace, which is the first day of the month.
Due
Period:
With
respect to any Remittance Date, the period commencing on the second day
of the
month preceding the month of such Remittance Date and ending on the first
day of
the month of the Remittance Date.
Eligible
Account:
An
account established and maintained: (i) within FDIC insured accounts created,
maintained and monitored by the Company so that all funds deposited therein
are
fully insured, or (ii) as a trust account with the corporate trust department
of
a depository institution or trust company organized under the laws of the
United
States of America or any one of the states thereof or the District of Columbia
which is not affiliated with the Company (or any sub-servicer) or (iii)
with an
entity which is an institution whose deposits are insured by the FDIC,
the
unsecured and uncollateralized long-term debt obligations of which shall
be
rated “A2” or higher by Standard & Poor’s and “A” or higher by Fitch, Inc.
or one of the two highest short-term ratings by any applicable Rating Agency,
and which is either (a) a federal savings association duly organized, validly
existing and in good standing under the federal banking laws, (b) an institution
duly organized, validly existing and in good standing under the applicable
banking laws of any state, (c) a national banking association under the
federal
banking laws, or (d) a principal subsidiary of a bank holding company,
or (iv)
if ownership of the Mortgage Loans is evidenced by mortgaged-backed securities,
the equivalent required ratings of each Rating Agency, and held such that
the
rights of the Purchaser and the owner of the Mortgage Loans shall be fully
protected against the claims of any creditors of the Company (or any
sub-servicer) and of any creditors or depositors of the institution in
which
such account is maintained or (v) in a separate non-trust account without
FDIC
or other insurance in an Eligible Institution. In the event that a Custodial
Account is established pursuant to clause (iii), (iv) or (v) of the preceding
sentence, the Company shall provide the Purchaser with written notice on
the
Business Day following the date on which the applicable institution fails
to
meet the applicable ratings requirements.
Eligible
Institution:
An
institution having (i) the highest short-term debt rating, and one of the
two
highest long-term debt ratings of each Rating Agency; or (ii) with respect
to
any Custodial Account, an unsecured long-term debt rating of at least one
of the
two highest unsecured long-term debt ratings of each Rating Agency.
Equity
Take-Out Refinanced Mortgage Loan:
A
Refinanced Mortgage Loan the proceeds of which were in excess of the outstanding
principal balance of the existing mortgage loan as defined in the Xxxxxx
Xxx
Guide(s).
Escrow
Account:
Each
separate trust account or accounts created and maintained pursuant to Section
4.06 which shall be entitled "[__________________], in trust for the
[Purchaser], Owner of Adjustable Rate Mortgage Loans, and various Mortgagors"
and shall be established in an Eligible Account, in the name of the Person
that
is the "Purchaser" with respect to the related Mortgage Loans.
Escrow
Payments:
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 9.01.
Xxxxxx
Mae: The
Federal National Mortgage Association, or any successor thereto.
Xxxxxx
Xxx Guide(s):
The
Xxxxxx Mae Selling Guide and the Xxxxxx Xxx Servicing Guide and all amendments
or additions thereto.
FDIC:
The
Federal Deposit Insurance Corporation, or any successor thereto.
FHLMC:
The
Federal Home Loan Mortgage Corporation, or any successor thereto.
FHLMC
Guide:
The
FHLMC Single Family Seller/Servicer Guide and all amendments or additions
thereto.
Fidelity
Bond:
A
fidelity bond to be maintained by the Company pursuant to Section
4.12.
FIRREA:
The
Financial Institutions Reform, Recovery, and Enforcement Act of
1989.
First
Remittance Date:
With
respect to any Mortgage Loan, the Remittance Date occurring in the month
following the month in which the related Closing Date occurs.
GAAP:
Generally accepted accounting principles, consistently applied.
HUD:
The
United States Department of Housing and Urban Development or any successor
thereto.
Index:
With
respect to any adjustable rate Mortgage Loan, the index identified on the
Mortgage Loan Schedule and set forth in the related Mortgage Note for the
purpose of calculating the interest rate thereon.
Initial
Rate Cap: As
to
each adjustable rate Mortgage Loan, where applicable, the maximum increase
or
decrease in the Mortgage Interest Rate on the first Adjustment
Date.
Insurance
Proceeds:
With
respect to each Mortgage Loan, proceeds of insurance policies insuring
the
Mortgage Loan or the related Mortgaged Property.
Lifetime
Rate Cap:
As to
each adjustable rate Mortgage Loan, the maximum Mortgage Interest Rate
over the
term of such Mortgage Loan.
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.
Loan-to-Value
Ratio or LTV:
With
respect to any Mortgage Loan, the ratio of the original outstanding principal
amount of the Mortgage Loan, to (i) the Appraised Value of the Mortgaged
Property as of the Origination Date with respect to a Refinanced Mortgage
Loan,
and (ii) the lesser of the Appraised Value of the Mortgaged Property as
of the
Origination Date or the purchase price of the Mortgaged Property with respect
to
all other Mortgage Loans.
Margin:
With
respect to each adjustable rate Mortgage Loan, the fixed percentage amount
set
forth in each related Mortgage Note which is added to the Index in order
to
determine the related Mortgage Interest Rate, as set forth in the Mortgage
Loan
Schedule.
Monthly
Advance:
The
aggregate of the advances made by the Company on any Remittance Date pursuant
to
Section 5.03.
Monthly
Payment:
The
scheduled monthly payment of principal and interest on a Mortgage Loan
which is
payable by a Mortgagor under the related Mortgage Note.
Mortgage:
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.
Mortgage
File:
The
mortgage documents pertaining to a particular Mortgage Loan which are specified
in Exhibit A hereto and any additional documents required to be added to
the
Mortgage File pursuant to this Agreement.
Mortgage
Impairment Insurance Policy:
A
mortgage impairment or blanket hazard insurance policy as described in
Section
4.11.
Mortgage
Interest Rate:
The
annual rate at which interest accrues on any Mortgage Loan, which may be
adjusted from time to time for an adjustable rate Mortgage Loan, in accordance
with the provisions of the related Mortgage Note.
Mortgage
Loan:
An
individual mortgage loan which is the subject of this Agreement, each Mortgage
Loan originally sold and subject to this Agreement being identified on
the
Mortgage Loan Schedule attached to the related Term Sheet, which Mortgage
Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
REO Disposition Proceeds, and all other rights, benefits, proceeds and
obligations arising from or in connection with such Mortgage Loan, excluding
replaced or repurchased mortgage loans.
Mortgage
Loan Documents:
The
documents listed in
Exhibit A.
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
Loan Schedule:
The
schedule of Mortgage Loans annexed to the related Term Sheet, such schedule
setting forth the following information with respect to each Mortgage Loan
in
the related Mortgage Loan Package:
(1) the
Company's Mortgage Loan identifying number;
(2) the
Mortgagor's first and last name;
(3)
the
street address of the Mortgaged Property including the city, state and
zip
code;
(4) a
code
indicating whether the Mortgaged Property is owner-occupied, a second home
or an
investor property;
(5) the
type
of residential property constituting the Mortgaged Property;
| (6) |
the
original months to maturity of the Mortgage
Loan;
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(7) the
remaining months to maturity from the related Cut-off Date, based on the
original amortization schedule and, if different, the maturity expressed
in the
same manner but based on the actual amortization schedule;
(8) the
Sales
Price, if applicable, Appraised Value and Loan-to-Value Ratio, at
origination;
(9) the
Mortgage Interest Rate as of origination and as of the related Cut-off
Date;
with respect to each adjustable rate Mortgage Loan, the initial Adjustment
Date,
the next Adjustment Date immediately following the related Cut-off Date,
the
Index, the Margin, the Initial Rate Cap, if any, Periodic Rate Cap, if
any,
minimum Mortgage Interest Rate under the terms of the Mortgage Note and
the
Lifetime Rate Cap;
(10) the
Origination Date of the Mortgage Loan;
(11) the
stated maturity date;
(12) the
amount of the Monthly Payment at origination;
(13) the
amount of the Monthly Payment as of the related Cut-off Date;
(14) the
original principal amount of the Mortgage Loan;
(15) the
scheduled Stated Principal Balance of the Mortgage Loan as of the close
of
business on the related Cut-off Date, after deduction of payments of principal
due on or before the related Cut-off Date whether or not collected;
(16)
a
code
indicating the purpose of the Mortgage Loan (i.e., purchase, rate and term
refinance, equity take-out refinance);
(17)
a
code
indicating the documentation style (i.e. full, alternative, etc.);
(18) the
number of times during the twelve (12) month period preceding the related
Closing Date that any Monthly Payment has been received after the month
of its
scheduled due date;
(19) the
date
on which the first payment is or was due;
| (20) |
a
code indicating whether or not the Mortgage Loan is the subject
of a
Primary Mortgage Insurance Policy and the name of the related
insurance
carrier;
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(21)
a
code
indicating whether or not the Mortgage Loan is currently convertible and
the
conversion spread;
(22)
the
last
Due Date on which a Monthly Payment was actually applied to the unpaid
principal
balance of the Mortgage Loan.
(23)
product
type (i.e. fixed, adjustable, 3/1, 5/1, etc.);
| (24) |
credit
score and/or mortgage score, if
applicable;
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(25) a
code
indicating whether or not the Mortgage Loan is the subject of a Lender
Primary
Mortgage Insurance Policy and the name of the related insurance carrier
and the
Lender Paid Mortgage Insurance Rate;
(26)a
code
indicating whether or not the Mortgage Loan has a prepayment penalty and
if so,
the amount and term thereof; and
(27) the
Current Appraised Value of the Mortgage Loan and Current LTV, if
applicable.
With
respect to the Mortgage Loans in the aggregate, the Mortgage Loan Schedule
attached to the related Term Sheet shall set forth the following information,
as
of the related Cut-off Date:
(1) the
number of Mortgage Loans;
(2) the
current aggregate outstanding principal balance of the Mortgage
Loans;
(3) the
weighted average Mortgage Interest Rate of the Mortgage Loans;
(4) the
weighted average maturity of the Mortgage Loans; and
(5)
the
weighted average months to next Adjustment Date;
Mortgage
Note:
The
note or other evidence of the indebtedness of a Mortgagor secured by a
Mortgage.
Mortgaged
Property:
The
underlying real property securing repayment of a Mortgage Note, consisting
of a
single parcel of real estate considered to be real estate under the laws
of the
state in which such real property is located which may include condominium
units
and planned unit developments, improved by a residential dwelling; 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,
a
leasehold estate of the Mortgage, the term of which is equal to or longer
than
the term of the Mortgage.
Mortgagor:
The
obligor on a Mortgage Note.
Nonrecoverable
Advance:
Any
portion of a Monthly Advance or Servicing Advance previously made or proposed
to
be made by the Company pursuant to this Agreement, that, in the good faith
judgment of the Company, will not or, in the case of a proposed advance,
would
not, be ultimately recoverable by it from the related Mortgagor or the
related
Liquidation Proceeds, Insurance Proceeds, Condemnation Proceeds or otherwise
with respect to the related Mortgage Loan.
OCC:
Office
of the Comptroller of the Currency, or any successor thereto.
Officers'
Certificate:
A
certificate signed by the Chairman of the Board, the Vice Chairman of the
Board,
the President, a Senior Vice President or a Vice President or by the Treasurer
or the Secretary or one of the Assistant Treasurers or Assistant Secretaries
of
the Company, and delivered to the Purchaser as required by this
Agreement.
Opinion
of Counsel:
A
written opinion of counsel, who may be an employee of the party on behalf
of
whom the opinion is being given, reasonably acceptable to the
Purchaser.
Origination
Date:
The
date on which a Mortgage Loan funded, which date shall not, in connection
with a
Refinanced Mortgage Loan, be the date of the funding of the debt being
refinanced, but rather the closing of the debt currently outstanding under
the
terms of the Mortgage Loan Documents.
OTS:
Office
of Thrift Supervision, or any successor thereto.
Periodic
Rate Cap:
As to
each adjustable rate Mortgage Loan, the maximum increase or decrease in
the
Mortgage Interest Rate on any Adjustment Date, as set forth in the related
Mortgage Note and the related Mortgage Loan Schedule.
Permitted
Investments:
Any one
or more of the following obligations or securities:
(i) direct
obligations of, and obligations fully guaranteed by the United States of
America
or any agency or instrumentality of the United States of America the obligations
of which are backed by the full faith and credit of the United States of
America;
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(ii)
(a) demand or time deposits, federal funds or bankers' acceptances
issued
by any depository institu-tion or trust company incorporated
under the
laws of the United States of America or any state thereof and
subject to
supervision and examination by federal and/or state banking authorities,
provided that the commercial paper and/or the short-term deposit
rating
and/or the long-term unsecured debt obligations or deposits of
such
depository institution or trust company at the time of such investment
or
contractual commitment providing for such investment are rated
in one of
the two highest rating categories by each Rating Agency and (b)
any other
demand or time deposit or certificate of deposit that is fully
insured by
the FDIC;
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(iii)
repurchase obligations with a term not to exceed thirty (30)
days and with
respect to (a) any security described in clause (i) above and
entered into
with a depository institution or trust company (acting as principal)
described in clause (ii)(a) above;
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(iv)
securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States
of America or
any state thereof that are rated in one of the two highest rating
categories by each Rating Agency at the time of such in-vestment
or
contractual commitment providing for such investment; provided,
however,
that securities issued by any particular corporation will not
be Permitted
Investments to the extent that investments therein will cause
the then
outstanding principal amount of secur-ities issued by such corporation
and
held as Permitted Investments to exceed 10% of the aggregate
outstand-ing
principal balances of all of the Mortgage Loans and Permitted
Investments;
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(v)
commercial paper (including both non-interest-bearing discount
obligations
and interest-bearing obliga-tions payable on demand or on a specified
date
not more than one year after the date of issuance there-of) which
are
rated in one of the two highest rating categories by each Rating
Agency at
the time of such investment;
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(vi)
any other demand, money market or time deposit, obligation, security
or
investment as may be acceptable to each Rating Agency as evidenced
in
writing by each Rating Agency; and
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(vii)
any money market funds the collateral of which consists of obligations
fully guaranteed by the United States of America or any agency
or
instru-ment-al-ity of the United States of America the obligations
of
which are backed by the full faith and credit of the United States
of
America (which may include repurchase obligations secured by
collateral
described in clause (i)) and other securities and which money
market funds
are rated in one of the two highest rating categories by each
Rating
Agency.
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provided,
however,
that no
instrument or security shall be a Permitted Investment if such instrument
or
security evidences a right to receive only interest payments with respect
to the
ob-li-ga-tions underlying such instrument or if such security provides
for
payment of both principal and interest with a yield to matur-ity in excess
of
120% of the yield to maturity at par or if such investment or security
is
purchased at a price greater than par.
Person:
Any
individual, corporation, partnership, joint venture, association, joint-stock
company, limited liability company, trust, unincorporated organization
or
government or any agency or political subdivision thereof.
Prepayment
Interest Shortfall:
With
respect to any Remittance Date, for each Mortgage Loan that was the subject
of a
Principal Prepayment during the related Prepayment Period, an amount equal
to
the excess of one month’s interest at the applicable Mortgage Loan Remittance
Rate on the amount of such Principal Prepayment over the amount of interest
(adjusted to the Mortgage Loan Remittance Rate) actually paid by the related
Mortgagor with respect to such Prepayment Period.
Prepayment
Period: With
respect to any Remittance Date, the calendar month preceding the month
in which
such Remittance Date occurs.
Primary
Mortgage Insurance Policy:
Each
primary policy of mortgage insurance represented to be in effect pursuant
to
Section 3.02(hh), or any replacement policy therefor obtained by the Company
pursuant to Section 4.08.
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 full or partial
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.
Purchase
Price:
As
defined in Section 2.02.
Purchaser:
EMC
Mortgage Corporation, its successors in interest and assigns.
Qualified
Appraiser:
An
appraiser, duly appointed by the Company, who had no interest, direct or
indirect in the related Mortgaged Property or in any loan made on the security
thereof, and whose compensation is not affected by the approval or disapproval
of the Mortgage Loan, and such appraiser and the appraisal made by such
appraiser both satisfy the requirements of Title XI of FIRREA and the
regulations promulgated thereunder and the requirements of Xxxxxx Xxx,
all as in
effect on the date the Mortgage Loan was originated.
Qualified
Insurer:
An
insurance company duly qualified as such under the laws of the states in
which
the related Mortgaged Property is 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 or FHLMC.
Rating
Agency:
Standard & Poor's, Fitch, Inc. or, in the event that some or all of the
ownership of the Mortgage Loans is evidenced by mortgage-backed securities,
the
nationally recognized rating agencies issuing ratings with respect to such
securities, if any.
Refinanced
Mortgage Loan:
A
Mortgage Loan which was made to a Mortgagor who owned the Mortgaged Property
prior to the origination of such Mortgage Loan and the proceeds of which
were
used in whole or part to satisfy an existing mortgage.
REMIC:
A "real
estate mortgage investment conduit," as such term is defined in Section
860D of
the Code.
REMIC
Provisions:
The
provisions of the federal income tax law relating to REMICs, which appear
at
Sections 860A through 860G of the Code, and the related provisions and
regulations promulgated thereunder, as the foregoing may be in effect from
time
to time.
Remittance
Date:
The
18th day of any month, beginning with the First Remittance Date, or if
such 18th
day is not a Business Day, the first Business Day immediately preceding
such
18th day.
REO
Disposition:
The
final sale by the Company of any REO Property.
REO
Disposition Proceeds:
Amounts
received by the Company in connection with a related REO
Disposition.
REO
Property:
A
Mortgaged Property acquired by the Company on behalf of the Purchaser as
described in Section 4.13.
Repurchase
Price:
With
respect to any Mortgage Loan, a price equal to (i) the product of the greater
of
100% or the percentage of par as stated in the Confirmation multiplied
by the
Stated Principal
Balance
of such Mortgage Loan on the repurchase date, plus
(ii)
interest on such outstanding principal balance at the Mortgage Loan Remittance
Rate from the last date through which interest has been paid and distributed
to
the Purchaser to the end of the month of repurchase, plus, (iii) third
party
expenses incurred in connection with the transfer of the Mortgage Loan
being
repurchased; less amounts received or advanced in respect of such repurchased
Mortgage Loan which are being held in the Custodial Account for distribution
in
the month of repurchase.
SAIF:
The
Savings Association Insurance Fund, or any successor thereto.
Sales
Price: With
respect to any Mortgage Loan the proceeds of which were used by the Mortgagor
to
acquire the related Mortgaged Property, the amount paid by the related
Mortgagor
for such Mortgaged Property.
Seller:
First
Horizon Home Loan Corporation, its successors in interest and assigns,
as
permitted by this Agreement.
Servicer:
First
Tennessee Mortgage Services, Inc., its successors in interest and assigns,
as
permitted by this Agreement.
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 Company 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, elections, 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 Company specifies
the
Mortgage Loan(s) to which such expenses relate and, upon Purchaser’s request,
provides documentation supporting such expense (which documentation would
be
acceptable to Xxxxxx Xxx), and provided further that any such enforcement,
administrative or judicial proceeding does not arise out of a breach of
any
representation, warranty or covenant of the Company hereunder), (c) the
management and liquidation of the Mortgaged Property if the Mortgaged Property
is acquired in full or partial 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 Primary Mortgage Insurance Policy
premiums and fire and hazard insurance coverage, (e) any expenses reasonably
sustained by the Company with respect to the liquidation of the Mortgaged
Property in accordance with the terms of this Agreement and (f) compliance
with
the obligations under Section 4.08.
Servicing
Fee:
With
respect to each Mortgage Loan, the amount of the annual fee the Purchaser
shall
pay to the Company, which shall, for a period of one full month, be equal
to
one-twelfth of the product of (a) the Servicing Fee Rate and (b) the outstanding
principal balance of such Mortgage Loan. Such fee shall be payable monthly,
computed on the basis of the same principal amount and period respecting
which
any related interest payment on a Mortgage Loan is computed. The obligation
of
the Purchaser to pay the Servicing Fee is limited to, and the Servicing
Fee is
payable solely from, the interest portion of such Monthly Payment collected
by
the Company, or as otherwise provided under Section 4.05 and in accordance
with
the Xxxxxx Mae Guide(s). Any fee payable to the Company for administrative
services related to any REO Property as described in Section 4.13 shall
be
payable from Liquidation Proceeds of the related REO Property.
Servicing
Fee Rate:
As set
forth in the Term Sheet.
Servicing
File:
With
respect to each Mortgage Loan, the file retained by the Company consisting
of
originals of all documents in the Mortgage File which are not delivered
to the
Purchaser and copies of the Mortgage Loan Documents listed in Exhibit A,
the
originals of which are delivered to the Purchaser or its designee pursuant
to
Section 2.04.
Servicing
Officer:
Any
officer of the Company 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 Company to the Purchaser upon request, as such
list
may from time to time be amended.
Stated
Principal Balance:
As to
each Mortgage Loan as of any date of determination, (i) the principal balance
of
such Mortgage Loan at the Cut-off Date after giving effect to payments
of
principal due on or before such date, whether or not received, minus (ii)
all
amounts previously distributed to the Purchaser with respect to the Mortgage
Loan representing payments or recoveries of principal or advances in lieu
thereof.
Subservicer:
Any
subservicer which is subservicing the Mortgage Loans pursuant to a Subservicing
Agreement. Any subservicer shall meet the qualifications set forth in Section
4.01.
Subservicing
Agreement:
An
agreement between the Company and a Subservicer, if any, for the servicing
of
the Mortgage Loans.
Term
Sheet:
A
supplemental agreement in the form attached hereto as Exhibit I which shall
be
executed and delivered by the Company and the Purchaser to provide for
the sale
and servicing pursuant to the terms of this Agreement of the Mortgage Loans
listed on Schedule I attached thereto, which supplemental agreement shall
contain certain specific information relating to such sale of such Mortgage
Loans and may contain additional covenants relating to such sale of such
Mortgage Loans.
ARTICLE
II
PURCHASE
OF MORTGAGE LOANS; SERVICING OF MORTGAGE LOANS;
RECORD
TITLE AND POSSESSION OF MORTGAGE FILES;
BOOKS
AND RECORDS; CUSTODIAL AGREEMENT;
DELIVERY
OF MORTGAGE LOAN DOCUMENTS
Section
2.01 Agreement
to Purchase.
The
Company agrees to sell and the Purchaser agrees to purchase the Mortgage
Loans
having an aggregate Stated Principal Balance on the related Cut-off Date
set
forth in the related Term Sheet in an amount as set forth in the Confirmation,
or in such other amount as agreed by the Purchaser and the Company as evidenced
by the actual aggregate Stated Principal Balance of the Mortgage Loans
accepted
by the Purchaser on the related Closing Date, with servicing retained by
the
Company. The Company shall deliver the related Mortgage Loan Schedule attached
to the related Term Sheet for the Mortgage Loans to be purchased on the
related
Closing Date to the Purchaser at least two (2) Business Days prior to the
related Closing Date. The Mortgage Loans shall be sold pursuant to this
Agreement, and the related Term Sheet shall be executed and delivered on
the
related Closing Date.
Section
2.02 Purchase
Price.
The
Purchase Price for each Mortgage Loan shall be the percentage of par as
stated
in the Confirmation (subject to adjustment as provided therein), multiplied
by
the Stated Principal Balance, as of the related Cut-off Date, of the Mortgage
Loan listed on the related Mortgage Loan Schedule attached to the related
Term
Sheet, after application of scheduled payments of principal due on or before
the
related Cut-off Date whether or not collected.
In
addition to the Purchase Price as described above, the Purchaser shall
pay to
the Company, at closing, accrued interest on the Stated Principal Balance
of
each Mortgage Loan as of the related Cut-off Date at the Mortgage Loan
Remittance Rate of each Mortgage Loan from the related Cut-off Date through
the
day prior to the related Closing Date, inclusive.
The
Purchase Price plus accrued interest as set forth in the preceding paragraph
shall be paid on the related Closing Date by wire transfer of immediately
available funds.
Purchaser
shall be entitled to (1) all scheduled principal due after the related
Cut-off
Date, (2) all other recoveries of principal collected on or after the related
Cut-off Date (provided, however, that all scheduled payments of principal
due on
or before the related Cut-off Date and collected by the Company or any
successor
servicer after the related Cut-off Date shall belong to the Company), and
(3)
all payments of interest on the Mortgage Loans net of applicable Servicing
Fees
(minus that portion of any such payment which is allocable to the period
prior
to the related Cut-off Date). The outstanding principal balance of each
Mortgage
Loan as of the related Cut-off Date is determined after application of
payments
of principal due on or before the related Cut-off Date whether or not collected,
together with any unscheduled principal prepayments collected prior to
the
related Cut-off Date; provided, however, that payments of scheduled principal
and interest prepaid for a Due Date beyond the related Cut-off Date shall
not be
applied to the principal balance as of the related Cut-off Date. Such prepaid
amounts shall be the property of the Purchaser. The Company shall deposit
any
such prepaid amounts into the Custodial Account, which account is established
for the benefit of the Purchaser for subsequent remittance by the Company
to the
Purchaser.
Section
2.03 Servicing
of Mortgage Loans.
Simultaneously
with the execution and delivery of each Term Sheet, the Company does hereby
agree to directly service the Mortgage Loans listed on the related Mortgage
Loan
Schedule attached to the related Term Sheet subject to the terms of this
Agreement and the related Term Sheet. The rights of the Purchaser to receive
payments with respect to the related Mortgage Loans shall be as set forth
in
this Agreement.
Section
2.04 Record
Title and Possession of Mortgage Files; Maintenance of Servicing
Files.
As
of the
related Closing Date, the Company sold, transferred, assigned, set over
and
conveyed to the Purchaser, without recourse, on a servicing retained basis,
and
the Company hereby acknowledges that the Purchaser has, but subject to
the terms
of this Agreement and the related Term Sheet, all the right, title and
interest
of the Company in and to the Mortgage Loans. Company will deliver the Mortgage
Files to the Custodian designated by Purchaser, on or before the related
Closing
Date, at the expense of the Company. The Company shall maintain a Servicing
File
consisting of 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
Servicing File shall contain all documents necessary to service the Mortgage
Loans. The possession of each Servicing File by the Company is at the will
of
the Purchaser, for the sole purpose of servicing the related Mortgage Loan,
and
such retention and possession by the Company is in a custodial capacity
only.
From the related Closing Date, the ownership of each Mortgage Loan, including
the Mortgage Note, the Mortgage, the contents of the related Mortgage File
and
all rights, benefits, proceeds and obligations arising therefrom or in
connection therewith, has been vested in the Purchaser. All rights arising
out
of the Mortgage Loans including, but not limited to, all funds received
on or in
connection with the Mortgage Loans and all records or documents with respect
to
the Mortgage Loans prepared by or which come into the possession of the
Company
shall be received and held by the Company in trust for the benefit of the
Purchaser as the owner of the Mortgage Loans. Any portion of the Mortgage
Files
retained by the Company shall be appropriately identified in the Company's
computer system to clearly reflect the ownership of the Mortgage Loans
by the
Purchaser. The Company shall release its custody of the contents of the
Mortgage
Files only in accordance with written instructions of the Purchaser, except
when
such release is required as incidental to the Company's servicing of the
Mortgage Loans or is in connection with a repurchase of any Mortgage Loan
or
Loans with respect thereto pursuant to this Agreement and the related Term
Sheet, such written instructions shall not be required.
Section
2.05 Books
and Records.
The
sale
of each Mortgage Loan shall be reflected on the Company's balance sheet
and
other financial statements as a sale of assets by the Company. The Company
shall
be responsible for maintaining, and shall maintain, a complete set of books
and
records for the Mortgage Loans that shall be appropriately identified in
the
Company's computer system to clearly reflect the ownership of the Mortgage
Loan
by the Purchaser. In particular, the Company shall maintain in its possession,
available for inspection by the Purchaser, or its designee and shall deliver
to
the Purchaser upon demand, evidence of compliance with all federal, state
and
local laws, rules and regulations, and requirements of Xxxxxx Xxx or FHLMC,
as
applicable, including but not limited to documentation as to the method
used in
determining the applicability of the provisions of the Flood Disaster Protection
Act of 1973, as amended, to the Mortgaged Property, documentation evidencing
insurance coverage of any condominium project as required by Xxxxxx Mae
or
FHLMC, and periodic inspection reports as required by Section 4.13. To
the
extent that original documents are not required for purposes of realization
of
Liquidation Proceeds or Insurance Proceeds, documents maintained by the
Company
may be in the form of microfilm or microfiche.
The
Company shall maintain with respect to each Mortgage Loan and shall make
available for inspection by any Purchaser or its designee the related Servicing
File during the time the Purchaser retains ownership of a Mortgage Loan
and
thereafter in accordance with applicable laws and regulations.
In
addition to the foregoing, Company shall provide to any supervisory agents
or
examiners that regulate Purchaser, including but not limited to, the OTS,
the
FDIC and other similar entities, access, during normal business hours,
upon
reasonable advance notice to Company and without cost to Company or such
supervisory agents or examiners, to any documentation regarding the Mortgage
Loans that may be required by any applicable regulator.
Section
2.06. Transfer
of Mortgage Loans.
The
Company shall keep at its servicing office books and records in which,
subject
to such reasonable regulations as it may prescribe, the Company 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 Company shall be under no obligation to deal with any person
with
respect to this Agreement or any Mortgage Loan unless a notice of the transfer
of such Mortgage Loan has been delivered to the Company in accordance with
this
Section 2.06 and the books and records of the Company show such person
as the
owner of the Mortgage Loan. The Purchaser may, subject to the terms of
this
Agreement, sell and 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 Company unless such transferee shall agree in writing
to be
bound by the terms of this Agreement and an original counterpart of the
instrument of transfer in an Assignment and Assumption of this Agreement
substantially in the form of Exhibit D hereto executed by the transferee
shall
have been delivered to the Company. The Purchaser also shall advise the
Company
of the transfer. Upon receipt of notice of the transfer, the Company shall
xxxx
its books and records to reflect the ownership of the Mortgage Loans of
such
assignee, and the previous Purchaser shall be released from its obligations
hereunder with respect to the Mortgage Loans sold or transferred.
Section
2.07 Delivery
of Mortgage Loan Documents.
The
Company shall deliver and release to the Purchaser or its designee the
Mortgage
Loan Documents in accordance with the terms of this Agreement and the related
Term Sheet. The documents enumerated as items (1), (2), (3), (4), (5),
(6), (7),
(8), (9) and (16) in Exhibit A hereto shall be delivered by the Company
to the
Purchaser or its designee no later than three (3) Business Days prior to
the
related Closing Date pursuant to a bailee letter agreement. All other documents
in Exhibit A hereto, together with all other documents executed in connection
with the Mortgage Loan that Company may have in its possession, shall be
retained by the Company in trust for the Purchaser. If the Company cannot
deliver the original recorded Mortgage Loan Documents or the original policy
of
title insurance, including riders and endorsements thereto, on the related
Closing Date, the Company shall, promptly upon receipt thereof and in any
case
not later than 120 days from the related Closing Date, deliver such original
documents, including original recorded documents, to the Purchaser or its
designee (unless the Company is delayed in making such delivery by reason
of the
fact that such documents shall not have been returned by the appropriate
recording office). If delivery is not completed within 120 days solely
due to
delays in making such delivery by reason of the fact that such documents
shall
not have been returned by the appropriate recording office, Company shall
deliver such document to Purchaser, or its designee, within such time period
as
specified in a Company's Officer's Certificate. In the event that documents
have
not been received by the date specified in the Company's Officer's Certificate,
a subsequent Company's Officer's Certificate shall be delivered by such
date
specified in the prior Company's Officer's Certificate, stating a revised
date
for receipt of documentation. The procedure shall be repeated until the
documents have been received and delivered. If delivery is not completed
within
180 days solely due to delays in making such delivery by reason of the
fact that
such documents shall not have been returned by the appropriate recording
office,
the Company shall continue to use its best efforts to effect delivery as
soon as
possible thereafter, provided that if such documents are not delivered
by the
270th day from the date of the related Closing Date, the Company shall
repurchase the related Mortgage Loans at the Repurchase Price in accordance
with
Section 3.03 hereof.
The
Company shall pay all initial recording fees, if any, for the assignments
of
mortgage and any other fees in connection with the transfer of all original
documents to the Purchaser or its designee. Company shall prepare, in recordable
form, all assignments of mortgage necessary to assign the Mortgage Loans
to
Purchaser, or its designee. Company shall be responsible for recording
the
assignments of mortgage.
Company
shall provide an original or duplicate original of the title insurance
policy to
Purchaser or its designee within ninety (90) days of the receipt of the
recorded
documents (required for issuance of such policy) from the applicable recording
office.
Any
review by the Purchaser, or its designee, of the Mortgage Files shall in
no way
alter or reduce the Company's obligations hereunder.
If
the
Purchaser or its designee discovers any defect with respect to a Mortgage
File,
the Purchaser shall, or shall cause its designee to, give written specification
of such defect to the Company which may be given in the exception report
or the
certification delivered pursuant to this Section 2.07, or otherwise in
writing
and the Company shall cure or repurchase such Mortgage Loan in accordance
with
Section 3.03.
The
Company shall forward to the Purchaser, or its designee, original documents
evidencing an assumption, modification, consolidation or extension of any
Mortgage Loan entered into in accordance with Section 4.01 or 6.01 within
one
week of their execution; provided, however, that the Company shall provide
the
Purchaser, or its designee, with a certified true copy of any such document
submitted for recordation within one week 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 sixty (60) days of its submission
for
recordation.
From
time
to time the Company may have a need for Mortgage Loan Documents to be released
from Purchaser, or its designee. Purchaser shall, or shall cause its designee,
upon the written request of the Company, within ten (10) Business Days,
deliver
to the Company, any requested documentation previously delivered to Purchaser
as
part of the Mortgage File, provided that such documentation is promptly
returned
to Purchaser, or its designee, when the Company no longer requires possession
of
the document, and provided that during the time that any such documentation
is
held by the Company, such possession is in trust for the benefit of Purchaser.
Company shall indemnify Purchaser, and its designee, from and against any
and
all losses, claims, damages, penalties, fines, forfeitures, costs and expenses
(including court costs and reasonable attorney's fees) resulting from or
related
to the loss, damage, or misplacement of any documentation delivered to
Company
pursuant to this paragraph.
Section
2.08 Quality
Control Procedures.
The
Company 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
must be
capable of evaluating and monitoring the overall quality of its loan production
and servicing activities. The program is to ensure that the Mortgage Loans
are
originated and serviced in accordance with prudent mortgage banking practices
and accounting principles; guard against dishonest, fraudulent, or negligent
acts; and guard against errors and omissions by officers, employees, or
other
authorized persons.
Section
2.09 Near-term
Principal Prepayments in Full; Near Term Payment Defaults
In
the
event any Principal Prepayment in full is made by a Mortgagor on or prior
to
three months after the related Closing Date, the Company shall remit to
the
Purchaser an amount equal to the excess, if any, of the Purchase Price
Percentage over par multiplied by the amount of such Principal Prepayment
in
full. Such remittance shall be made by the Company to Purchaser not later
than
five (5) Business Days after notice to the Company.
In
the
event either of the first three (3) scheduled Monthly Payments which are
due
under any Mortgage Loan after the related Cut-off Date are not made during
the
month in which such Monthly Payments are due, then not later than five
(5)
Business Days after notice to the Company by Purchaser (and at Purchaser’s sole
option), the Company, shall repurchase such Mortgage Loan from the Purchaser
pursuant to the repurchase provisions contained in this Subsection
3.03.
Section
2.10 Modification
of Obligations.
Purchaser
may, without any notice to Company, extend, compromise, renew, release,
change,
modify, adjust or alter, by operation of law or otherwise, any of the
obligations of the Mortgagors or other persons obligated under a Mortgage
Loan
without releasing or otherwise affecting the obligations of Company under
this
Agreement, or with respect to such Mortgage Loan, except to the extent
Purchaser’s extension, compromise, release, change, modification, adjustment, or
alteration affects Company’s ability to collect the Mortgage Loan or realize on
the security of the Mortgage, but then only to the extent such action has
such
effect.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF
THE
COMPANY; REPURCHASE; REVIEW OF MORTGAGE LOANS
Section
3.01 Representations
and Warranties of the Company.
Each
the
Seller and Servicer represents, warrants and covenants to the Purchaser
that, as
of the related Closing Date or as of such date specifically provided
herein:
(a) The
Company is a corporation, duly organized, validly existing and in good
standing
under the laws of the State of Kansas and has all licenses necessary to
carry
out its business as now being conducted, and is licensed and qualified
to
transact business in and is in good standing under the laws of each state
in
which any Mortgaged Property is located or is otherwise exempt under applicable
law from such licensing or qualification or is otherwise not required under
applicable law to effect such licensing or qualification and no demand
for such
licensing or qualification has been made upon such Company by any such
state,
and in any event such Company is in compliance with the laws of any such
state
to the extent necessary to ensure the enforceability of each Mortgage Loan
and
the servicing of the Mortgage Loans in accordance with the terms of this
Agreement. The Servicer is a wholly owned subsidiary of the Seller;
(b)
The
Company has the full power and authority and legal right to hold, transfer
and
convey each Mortgage Loan, to sell each Mortgage Loan and to execute, deliver
and perform, and to enter into and consummate all transactions contemplated
by
this Agreement and the related Term Sheet and to conduct its business as
presently conducted, has duly authorized the execution, delivery and performance
of this Agreement and the related Term Sheet and any agreements contemplated
hereby, has duly executed and delivered this Agreement and the related
Term
Sheet, and any agreements contemplated hereby, and this Agreement and the
related Term Sheet and each Assignment to the Purchaser and any agreements
contemplated hereby, constitutes a legal, valid and binding obligation
of the
Company, enforceable against it in accordance with its terms, and all requisite
corporate action has been taken by the Company to make this Agreement and
the
related Term Sheet and all agreements contemplated hereby valid and binding
upon
the Company in accordance with their terms;
(c)
Neither the execution and delivery of this Agreement and the related Term
Sheet,
nor the origination or purchase of the Mortgage Loans by the Company, the
sale
of the Mortgage Loans to the Purchaser, the consummation of the transactions
contemplated hereby, or the fulfillment of or compliance with the terms
and
conditions of this Agreement and the related Term Sheet will conflict with
any
of the terms, conditions or provisions of the Company's charter or by-laws
or
materially conflict with or result in a material breach of any of the terms,
conditions or provisions of any legal restriction or any agreement or instrument
to which the Company 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 material violation of any law, rule, regulation, order, judgment or
decree
to which the Company or its properties are subject, or impair the ability
of the
Purchaser to realize on the Mortgage Loans.
(d)
There
is no litigation, suit, proceeding or investigation pending or, to the
best of
Company’s knowledge, threatened, or any order or decree outstanding, with
respect to the Company which, either in any one instance or in the aggregate,
is
reasonably likely to have a material adverse effect on the sale of the
Mortgage
Loans, the execution, delivery, performance or enforceability of this Agreement
and the related Term Sheet, or which is reasonably likely to have a material
adverse effect on the financial condition of the Company.
(e)
No
consent, approval, authorization or order of any court or governmental
agency or
body is required for the execution, delivery and performance by the Company
of
or compliance by the Company with this Agreement or the related Term Sheet,
or
the sale of the Mortgage Loans and delivery of the Mortgage Files to the
Purchaser or the consummation of the transactions contemplated by this
Agreement
or the related Term Sheet, except for consents, approvals, authorizations
and
orders which have been obtained;
(f)
The
consummation of the transactions contemplated by this Agreement or the
related
Term Sheet is in the ordinary course of business of the Company and Company,
and
the transfer, assignment and conveyance of the Mortgage Notes and the Mortgages
by the Company pursuant to this Agreement or the related Term Sheet are
not
subject to bulk transfer or any similar statutory provisions in effect
in any
applicable jurisdiction;
(g)
The
origination and servicing practices used by the Company and any prior originator
or servicer with respect to each Mortgage Note and Mortgage have been legal
and
in accordance with applicable laws and regulations and the Mortgage Loan
Documents, and in all material respects proper and prudent in the mortgage
origination and servicing business. Each Mortgage Loan has been serviced
in all
material respects with Accepted Servicing Practices. With respect to escrow
deposits and payments that the Company, on behalf of an investor, is entitled
to
collect, all such payments are in the possession of, or under the control
of,
the Company, and there exist no deficiencies in connection therewith for
which
customary arrangements for repayment thereof have not been made. All escrow
payments have been collected in full compliance with state and federal
law and
the provisions of the related Mortgage Note and Mortgage. As to any Mortgage
Loan that is the subject of an escrow, escrow of funds is not prohibited
by
applicable law and has been established in an amount sufficient to pay
for every
escrowed item that remains unpaid and has been assessed but is not yet
due and
payable. No escrow deposits or other charges or payments due under the
Mortgage
Note have been capitalized under any Mortgage or the related Mortgage
Note;
(h)
The
Company used no selection procedures that identified the Mortgage Loans
as being
less desirable or valuable than other comparable mortgage loans in the
Company's
portfolio at the related Cut-off Date;
(i) The
Company will treat the sale of the Mortgage Loans to the Purchaser as a
sale for
reporting and accounting purposes and, to the extent appropriate, for federal
income tax purposes;
(j) Company
is an approved seller/servicer of residential mortgage loans for Xxxxxx
Xxx,
FHLMC and HUD, with such facilities, procedures and personnel necessary
for the
sound servicing of such mortgage loans. The Company is duly qualified,
licensed,
registered and otherwise authorized under all applicable federal, state
and
local laws, and regulations, if applicable, meets the minimum capital
requirements set forth by the OCC, and is in good standing to sell mortgage
loans to and service mortgage loans for Xxxxxx Mae and FHLMC and no event
has
occurred which would make Company unable to comply with eligibility requirements
or which would require notification to either Xxxxxx Xxx or FHLMC;
(k) The
Company does not believe, nor does it have any cause or reason to believe,
that
it cannot perform each and every covenant contained in this Agreement or
the
related Term Sheet. The Company is solvent and the sale of the Mortgage
Loans
will not cause the Company to become insolvent. The sale of the Mortgage
Loans
is not undertaken with the intent to hinder, delay or defraud any of the
Company's creditors;
(l) No
statement, tape, diskette, form, report or other document prepared by,
or on
behalf of, Company pursuant to this Agreement or the related Term Sheet
or in
connection with the transactions contemplated hereby, contains or will
contain
any statement that is or will be inaccurate or misleading in any material
respect;
(m)
The
Company 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 Company, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans
pursuant
to this Agreement. In the opinion of Company, the consideration received
by
Company upon the sale of the Mortgage Loans to Purchaser under this Agreement
and the related Term Sheet constitutes fair consideration for the Mortgage
Loans
under current market conditions.
(n)
Company
has delivered to the Purchaser financial statements of its parent, for
its last
two complete fiscal years. All such financial information fairly presents
the
pertinent results of operations and financial position for the period identified
and has been prepared in accordance with GAAP consistently applied throughout
the periods involved, except as set forth in the notes thereto. There has
been
no change in the business, operations, financial condition, properties
or assets
of the Company since the date of the Company’s financial information that would
have a material adverse effect on its ability to perform its obligations
under
this Agreement;
(o)
The
Company has not dealt with any broker, investment banker, agent or other
person
that may be entitled to any commission or compensation in connection with
the
sale of the Mortgage Loans;
Section
3.02 Representations
and Warranties as to Individual Mortgage Loans.
References
in this Section to percentages of Mortgage Loans refer in each case to
the
percentage of the aggregate Stated Principal Balance of the Mortgage Loans
as of
the related Cut-off Date, based on the outstanding Stated Principal Balances
of
the Mortgage Loans as of the related Cut-off Date, and giving effect to
scheduled Monthly Payments due on or prior to the related Cut-off Date,
whether
or not received. References to percentages of Mortgaged Properties refer,
in
each case, to the percentages of expected aggregate Stated Principal Balances
of
the related Mortgage Loans (determined as described in the preceding sentence).
The Company hereby represents and warrants to the Purchaser, as to each
Mortgage
Loan, as of the related Closing Date as follows:
(a)
The
information set forth in the Mortgage Loan Schedule attached to the related
Term
Sheet is true, complete and correct in all material respects as of the
related
Cut-Off Date;
(b) The
Mortgage creates a valid, subsisting and enforceable first lien or a first
priority ownership interest in an estate in fee simple in real property
securing
the related Mortgage Note subject to principles of equity, bankruptcy,
insolvency and other laws of general application affecting the rights of
creditors;
(c)
All
payments due prior to the related Cut-off Date for such Mortgage Loan have
been
made as of the related Closing Date; the Mortgage Loan has not been dishonored;
there are no material defaults under the terms of the Mortgage Loan; the
Company
has not advanced its own funds, or induced, solicited or knowingly received
any
advance of funds from a party other than the owner of the Mortgaged Property
subject to the Mortgage, directly or indirectly, for the payment of any
amount
required by the Mortgage Loan. As of the related Closing Date, all of the
Mortgage Loans will have an actual interest paid to date of their related
Cut-off Date(or later) and will be due for the scheduled monthly payment
next
succeeding the Cut-off Date (or later), as evidenced by a posting to Company's
servicing collection system. No payment under any Mortgage Loan is delinquent
as
of the related Closing Date nor has any scheduled payment been delinquent
at any
time during the twelve (12) months prior to the month of the related Closing
Date. For purposes of this paragraph, a Mortgage Loan will be deemed delinquent
if any payment due thereunder was not paid by the Mortgagor in the month
such
payment was due;
(d)
There
are no defaults by Company in complying with the terms of the Mortgage,
and all
taxes, governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due
and
owing have been paid, or escrow funds have been established in an amount
sufficient to pay for every such escrowed item which remains unpaid and
which
has been assessed but is not yet due and payable;
(e)
The
terms of the Mortgage Note and the Mortgage have not been impaired, waived,
altered or modified in any respect, except by written instruments which
have
been recorded to the extent any such recordation is required by law, or,
necessary to protect the interest of the Purchaser. No instrument of waiver,
alteration or modification has been executed except in connection with
a
modification agreement and which modification agreement is part of the
Mortgage
File and the terms of which are reflected in the related Mortgage Loan
Schedule,
and no Mortgagor has been released, in whole or in part, from the terms
thereof
except in connection with an assumption agreement and which assumption
agreement
is part of the Mortgage File and the terms of which are reflected in the
related
Mortgage Loan Schedule; the substance of any such waiver, alteration or
modification has been approved by the issuer of any related Primary Mortgage
Insurance Policy and title insurance policy, to the extent required by
the
related policies;
(f)
The
Mortgage Note and the Mortgage are not subject to any right of rescission,
set-off, counterclaim or defense, including, without limitation, the defense
of
usury, nor will the operation of any of the terms of the Mortgage Note
or the
Mortgage, or the exercise of any right thereunder, render the Mortgage
Note or
Mortgage unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including the defense of
usury,
and no such right of rescission, set-off, counterclaim or defense has been
asserted with respect thereto; and as of the related Closing Date the Mortgagor
was not a debtor in any state or federal bankruptcy or insolvency
proceeding;
(g)
All
buildings or other customarily insured improvements upon the Mortgaged
Property
are insured by a Qualified Insurer, against loss by fire, hazards of extended
coverage and such other hazards as are provided for in the Xxxxxx Mae or
FHLMC
Guide, as well as all additional requirements set forth in Section 4.10
of this
Agreement. All such standard hazard policies are in full force and effect
and
contain a standard mortgagee clause naming the Company and its successors
in
interest and assigns as loss payee and such clause is still in effect and
all
premiums due thereon have been paid. If required by the Flood Disaster
Protection Act of 1973, as amended, the Mortgage Loan is covered by a flood
insurance policy meeting the requirements of the current guidelines of
the
Federal Insurance Administration which policy conforms to Xxxxxx Xxx or
FHLMC
requirements, as well as all additional requirements set forth in Section
4.10
of this Agreement. Such policy was issued by a Qualified Insurer. The Mortgage
obligates the Mortgagor thereunder to maintain all such insurance at the
Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to maintain such insurance at the
Mortgagor's cost and expense and to seek reimbursement therefor from the
Mortgagor. Neither the Company (nor any prior originator or servicer of
any of
the Mortgage Loans) nor any Mortgagor has engaged in any act or omission
which
has impaired or would impair the coverage of any such policy, the benefits
of
the endorsement provided for herein, or the validity and binding effect
of
either;
(h)
Any
and all requirements of any federal, state or local law including, without
limitation, usury, truth-in-lending, real estate settlement procedures,
consumer
credit protection, equal credit opportunity or disclosure laws applicable
to the
Mortgage Loan have been complied with in all material respects. None
of
the Mortgage Loans are (a) loans subject to 12 CFR Part 226.31, 12 CFR
Part
226.32 or 12 CFR Part 226.34 of Regulation Z, the regulation implementing
TILA,
which implements the Home Ownership and Equity Protection Act of 1994,
as
amended or (b) classified and/or defined as a “high cost”, "covered", or
“predatory” loan under any other state, federal or local law or regulation or
ordinance, including, but not limited to, the States of Georgia and North
Carolina and the City of New York. The
Company maintains, and shall maintain, evidence of such compliance as required
by applicable law or regulation and shall make such evidence available
for
inspection at the Company's office during normal business hours upon reasonable
advance notice;
(i)
The
Mortgage has not been satisfied, canceled or subordinated, in whole or
in part,
or rescinded, and the Mortgaged Property has not been released from the
lien of
the Mortgage, in whole or in part nor has any instrument been executed
that
would effect any such release, cancellation, subordination or rescission.
The
Company has not waived the performance by the Mortgagor of any action,
if the
Mortgagor’s failure to perform such action would cause the Mortgage Loan to be
in default, nor has the Company waived any default resulting from any action
or
inaction by the Mortgagor;
(j) The
Mortgage is a valid, subsisting, enforceable and perfected first lien on
the
Mortgaged Property, including all buildings on the Mortgaged Property and
all
installations and mechanical, electrical, plumbing, heating and air conditioning
systems affixed to such buildings, and all additions, alterations and
replacements made at any time with respect to the foregoing securing the
Mortgage Note's original principal balance subject to principles of equity,
bankruptcy, insolvency and other laws of general application affecting
the
rights of creditors. The Mortgage and the Mortgage Note do not contain
any
evidence of any security interest or other interest or right thereto. Such
lien
is free and clear of all adverse claims, liens and encumbrances having
priority
over the first lien of the Mortgage subject only to (1) the lien of
non-delinquent current real property taxes and assessments not yet due
and
payable, (2) covenants, conditions and restrictions, rights of way, easements
and other matters of the public record as of the date of recording which
are
acceptable to mortgage lending institutions generally and either (A) which
are
referred to in the lender’s title insurance policy delivered to the originator
or otherwise considered in the appraisal made for the originator of the
Mortgage
Loan, or (B) which do not adversely affect the residential use or Appraised
Value of the Mortgaged Property as set forth in such appraisal, and (3)
other
matters to which like properties are commonly subject which do not individually
or in the aggregate materially interfere with the benefits of the security
intended to be provided by the Mortgage or the use, enjoyment, value or
marketability of the related Mortgaged Property. Any security agreement,
chattel
mortgage or equivalent document related to and delivered in connection
with the
Mortgage Loan establishes and creates a valid, subsisting, enforceable
and
perfected first lien and first priority security interest on the property
described therein, and the Company has the full right to sell and assign
the
same to the Purchaser;
(k)
The
Mortgage Note and the related Mortgage are original and genuine and each
is the
legal, valid and binding obligation of the maker thereof, enforceable in
all
respects in accordance with its terms subject to principles of equity,
bankruptcy, insolvency and other laws of general application affecting
the
rights of creditors, and the Company has taken all action necessary to
transfer
such rights of enforceability to the Purchaser. All parties to the Mortgage
Note
and the Mortgage had the legal capacity to enter into the Mortgage Loan
and to
execute and deliver the Mortgage Note and the Mortgage. The Mortgage Loan
Documents are on forms acceptable to Xxxxxx Mae and FHLMC. The Mortgage
Note and
the Mortgage have been duly and properly executed by such parties. No fraud,
error, omission, misrepresentation, negligence or similar occurrence with
respect to a Mortgage Loan has taken place on the part of Company or the
Mortgagor, or on the part of any other party involved in the origination
or
servicing of the Mortgage Loan. The proceeds of the Mortgage Loan have
been
fully disbursed and there is no requirement for future advances thereunder,
and
any and all requirements as to completion of any on-site or off-site
improvements and as to disbursements of any escrow funds therefor have
been
complied with. All costs, fees and expenses incurred in making or closing
the
Mortgage Loan and the recording of the Mortgage were paid, and the Mortgagor
is
not entitled to any refund of any amounts paid or due under the Mortgage
Note or
Mortgage;
(l)
The
Company is the sole owner and holder of the Mortgage Loan and the indebtedness
evidenced by the Mortgage Note. Upon the sale of the Mortgage Loan to the
Purchaser, the Company will retain the Mortgage File or any part thereof
with
respect thereto not delivered to the Purchaser or the Purchaser’s designee in
trust only for the purpose of servicing and supervising the servicing of
the
Mortgage Loan. Immediately prior to the transfer and assignment to the
Purchaser, the Mortgage Loan, including the Mortgage Note and the Mortgage,
were
not subject to an assignment, sale or pledge to any person other than Purchaser,
and the Company had good and marketable title to and was the sole owner
thereof
and had full right to transfer and sell the Mortgage Loan to the Purchaser
free
and clear of any encumbrance, equity, lien, pledge, charge, claim or security
interest and has the full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign
the
Mortgage Loan pursuant to this Agreement and following the sale of the
Mortgage
Loan, the Purchaser will own such Mortgage Loan free and clear of any
encumbrance, equity, participation interest, lien, pledge, charge, claim
or
security interest. The Company intends to relinquish all rights to possess,
control and monitor the Mortgage Loan, except for the purposes of servicing
the
Mortgage Loan as set forth in this Agreement. After the related Closing
Date,
the Company will not have any right to modify or alter the terms of the
sale of
the Mortgage Loan and the Company will not have any obligation or right
to
repurchase the Mortgage Loan or substitute another Mortgage Loan, except
as
provided in this Agreement, or as otherwise agreed to by the Company and
the
Purchaser;
(m)
Each
Mortgage Loan is covered by an ALTA lender's title insurance policy or
other
generally acceptable form of policy or insurance acceptable to Xxxxxx Xxx
or
FHLMC (including adjustable rate endorsements), issued by a title insurer
acceptable to Xxxxxx Mae or FHLMC and qualified to do business in the
jurisdiction where the Mortgaged Property is located, insuring (subject
to the
exceptions contained in (j)(1), (2) and (3) above) the Company, its successors
and assigns, as to the first priority lien of the Mortgage in the original
principal amount of the Mortgage Loan and against any loss by reason of
the
invalidity or unenforceability of the lien resulting from the provisions
of the
Mortgage providing for adjustment in the Mortgage Interest Rate and Monthly
Payment. Where required by state law or regulation, the Mortgagor has been
given
the opportunity to choose the carrier of the required mortgage title insurance.
The Company, its successors and assigns, is the sole insured of such lender's
title insurance policy, such title insurance policy has been duly and validly
endorsed to the Purchaser or the assignment to the Purchaser of the Company's
interest therein does not require the consent of or notification to the
insurer
and such lender's title insurance policy is in full force and effect and
will be
in full force and effect upon the consummation of the transactions contemplated
by this Agreement. No claims have been made under such lender's title insurance
policy, and no prior holder or servicer of the related Mortgage, including
the
Company, nor any Mortgagor, has done, by act or omission, anything which
would
impair the coverage of such lender's title insurance policy;
(n)
There
is no default, breach, violation or event of acceleration existing under
the
Mortgage or the related Mortgage Note and no event which, with the passage
of
time or with notice and the expiration of any grace or cure period, would
constitute a default, breach, violation or event permitting acceleration;
and
neither the Company, nor any prior mortgagee has waived any default, breach,
violation or event permitting acceleration;
(o)
There
are no mechanics' or similar liens or claims which have been filed for
work,
labor or material (and no rights are outstanding that under law could give
rise
to such liens) affecting the related Mortgaged Property which are or may
be
liens prior to or equal to the lien of the related Mortgage;
(p)
All
improvements subject to the Mortgage which were considered in determining
the
appraised value of the Mortgaged Property lie wholly within the boundaries
and
building restriction lines of the Mortgaged Property (and wholly within
the
project with respect to a condominium unit) and no improvements on adjoining
properties encroach upon the Mortgaged Property except those which are
insured
against by the title insurance policy referred to in clause (m) above and
all
improvements on the property comply with all applicable zoning and subdivision
laws and ordinances;
(q)
Each
Mortgage Loan was originated by or for the Company pursuant to, and conforms
with, the Company’s underwriting guidelines attached as Exhibit H hereto. The
Mortgage Loan bears interest at an adjustable rate (if applicable) as set
forth
in the related Mortgage Loan Schedule, and Monthly Payments under the Mortgage
Note are due and payable on the first day of each month. The Mortgage contains
the usual and enforceable provisions of the Company at the time of origination
for the acceleration of the payment of the unpaid principal amount of the
Mortgage Loan if the related Mortgaged Property is sold without the prior
consent of the mortgagee thereunder;
(r)
The
Mortgaged Property is not subject to any material damage. At origination
of the
Mortgage Loan there was not, since origination of the Mortgage Loan there
has
not been, and there currently is no proceeding pending for the total or
partial
condemnation of the Mortgaged Property. The Company has not received
notification that any such proceedings are scheduled to commence at a future
date;
(s)
The
related Mortgage contains customary and enforceable provisions such as
to render
the rights and remedies of the holder thereof adequate for the realization
against the Mortgaged Property of the benefits of the security provided
thereby,
including, (1) in the case of a Mortgage designated as a deed of trust,
by
trustee's sale, and (2) otherwise by judicial foreclosure. There is no
homestead
or other exemption available to the Mortgagor which would interfere with
the
right to sell the Mortgaged Property at a trustee's sale or the right to
foreclose the Mortgage;
(t)
If
the Mortgage constitutes a deed of trust, a trustee, authorized and duly
qualified if required under applicable law to act as such, has been properly
designated and currently so serves and is named in the Mortgage, and no
fees or
expenses, except as may be required by local law, are or will become payable
by
the Purchaser to the trustee under the deed of trust, except in connection
with
a trustee's sale or attempted sale after default by the Mortgagor;
(u)
The
Mortgage File contains an appraisal of the related Mortgaged Property signed
prior to the final approval of the mortgage loan application by a Qualified
Appraiser, approved by the Company, who had no interest, direct or indirect,
in
the Mortgaged Property or in any loan made on the security thereof, and
whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan, and the appraisal and appraiser both satisfy the requirements of
Xxxxxx
Xxx or FHLMC and Title XI of the Federal Institutions Reform, Recovery,
and
Enforcement Act of 1989 and the regulations promulgated thereunder, all
as in
effect on the date the Mortgage Loan was originated. The appraisal is in
a form
acceptable to Xxxxxx Mae or FHLMC;
(v)
All
parties which have had any interest in the Mortgage, whether as mortgagee,
assignee, pledgee or otherwise, are (or, during the period in which they
held
and disposed of such interest, were) (A) in compliance with any and all
applicable licensing requirements of the laws of the state wherein the
Mortgaged
Property is located, and (B) (1) organized under the laws of such state,
or (2)
qualified to do business in such state, or (3) federal savings and loan
associations or national banks or a Federal Home Loan Bank or savings bank
having principal offices in such state, or (4) not doing business in such
state;
(w)
The
related Mortgage Note is not and has not been secured by any collateral
except
the lien of the corresponding Mortgage and the security interest of any
applicable security agreement or chattel mortgage referred to above and
such
collateral does not serve as security for any other obligation;
(x)
The
Mortgagor has received and has executed, where applicable, all disclosure
materials required by applicable law with respect to the making of such
mortgage
loans;
(y)
The
Mortgage Loan does not contain balloon or "graduated payment" features.
Unless
otherwise indicated on the related Mortgage Loan Schedule, no Mortgage
Loan is
subject to a buydown agreement or contains any buydown provision;
(z)
The
Mortgagor is not in bankruptcy and, the Mortgagor is not insolvent and
the
Company has no knowledge of any circumstances or conditions with respect
to the
Mortgage, the Mortgaged Property, the Mortgagor or the Mortgagor's credit
standing that could reasonably be expected to cause investors to regard
the
Mortgage Loan as an unacceptable investment, cause the Mortgage Loan to
become
delinquent, or materially adversely affect the value or marketability of
the
Mortgage Loan;
(aa)
Each
Mortgage Loan bears interest based upon a thirty (30) day month and a three
hundred and sixty (360) day year. The Mortgage Loans have an original term
to
maturity of not more than thirty (30) years, with interest payable in arrears
on
the first day of each month. As to each adjustable rate Mortgage Loan,
on each
applicable Adjustment Date, the Mortgage Interest Rate will be adjusted
to equal
the sum of the Index, plus the applicable Margin; provided, that the Mortgage
Interest Rate, on each applicable Adjustment Date, will not increase by
more
than the Initial Rate Cap or Periodic Rate Cap, as applicable. Over the
term of
each adjustable rate Mortgage Loan, the Mortgage Interest Rate will not
exceed
such Mortgage Loan's Lifetime Rate Cap. None of the Mortgage Loans are
“interest-only” Mortgage Loans or “negative amortization” Mortgage Loans. With
respect to each adjustable rate Mortgage Loan, each Xxxx-xxxx Note requires
a
monthly payment which is suffi-cient (a) during the period prior to the
first
adjust-ment to the Mortgage Interest Rate, to fully amortize the original
principal balance over the original term thereof and to pay interest at
the
related Mortgage Interest Rate, and (b) during the period following each
Adjust-ment Date, to fully amortize the outstanding principal balance as
of the
first day of such period over the then remaining term of such Mortgage
Note and
to pay interest at the related Mortgage Interest Rate. With respect to
each
adjustable rate Mortgage Loan, the Mortgage Note provides that when the
Mortgage
Interest Rate changes on an Adjustment Date, the then outstanding principal
balance will be reamortized over the remaining life of the Mortgage Loan.
No
Mortgage Loan contains terms or provi-sions which would result in negative
amortization. None of the Mortgage Loans contain a conversion feature which
would cause the Mortgage Loan interest rate to convert to a fixed interest
rate.
None of the Mortgage Loans are considered agricultural loans;
(bb)
(INTENTIONALLY LEFT BLANK)
(cc)
(INTENTIONALLY LEFT BLANK)
(dd)
(INTENTIONALLY LEFT BLANK)
(ee)
(INTENTIONALLY LEFT BLANK)
(ff)
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(gg)
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(hh) In
the
event the Mortgage Loan had an LTV at origination greater than 80.00%,
the
excess of the principal balance of the Mortgage Loan over 75.0% of the
Appraised
Value of the Mortgaged Property with respect to a Refinanced Mortgage Loan,
or
the lesser of the Appraised Value or the purchase price of the Mortgaged
Property with respect to a purchase money Mortgage Loan was insured as
to
payment defaults by a Primary Mortgage Insurance Policy issued by a Qualified
Insurer. No Mortgage Loan has an LTV over 95%. All provisions of such Primary
Mortgage Insurance Policy have been and are being complied with, such policy
is
in full force and effect, and all premiums due thereunder have been paid.
No
Mortgage Loan requires payment of such premiums, in whole or in part, by
the
Purchaser. No action, inaction, or event has occurred and no state of facts
exists that has, or will result in the exclusion from, denial of, or defense
to
coverage. Any Mortgage Loan subject to a Primary Mortgage Insurance Policy
obligates the Mortgagor thereunder to maintain the Primary Mortgage Insurance
Policy, subject to state and federal law, and to pay all premiums and charges
in
connection therewith. No action has been taken or failed to be taken, on
or
prior to the Closing Date which has resulted or will result in an exclusion
from, denial of, or defense to coverage under any Primary Mortgage Insurance
Policy (including, without limitation, any exclusions, denials or defenses
which
would limit or reduce the availability of the timely payment of the full
amount
of the loss otherwise due thereunder to the insured) whether arising out
of
actions, representations, errors, omissions, negligence, or fraud of the
Company
or the Mortgagor, or for any other reason under such coverage; The mortgage
interest rate for the Mortgage Loan as set forth on the related Mortgage
Loan
Schedule is net of any such insurance premium. None of the Mortgage Loans
are
subject to “lender-paid” mortgage insurance;
(ii) The
Assignment is in recordable form and is acceptable for recording under
the laws
of the jurisdiction in which the Mortgaged Property is located;
(jj) Unless
otherwise indicated on the related Mortgage Loan Schedule, none of the
Mortgage
Loans are secured by an interest in a leasehold estate. The Mortgaged Property
is located in the state identified in the related Mortgage Loan Schedule
and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a townhouse, or a two-to four-family dwelling,
or
an individual condominium unit in a condominium project, or an individual
unit
in a planned unit development or a de minimis planned unit development,
provided, however, that no residence or dwelling is a single parcel of
real
property with a manufactured home not affixed to a permanent foundation,
or a
mobile home. Any
non-warrantable condominium unit, condominium unit or planned unit development
conforms with the Company’s underwriting guidelines. As
of the
date of origination, no portion of any Mortgaged Property was used for
commercial purposes, and since the Origination Date, no portion of any
Mortgaged
Property has been, or currently is, used for commercial purposes;
(kk) Payments
on the Mortgage Loan commenced no more than sixty (60) days after the funds
were
disbursed in connection with the Mortgage Loan. The Mortgage Note is payable
on
the first day of each month in monthly installments of principal and interest,
which installments are subject to change due to the adjustments to the
Mortgage
Interest Rate on each Adjustment Date, with interest calculated and payable
in
arrears. Each of the Mortgage Loans will amortize fully by the stated maturity
date, over an original term of not more than thirty years from commencement
of
amortization;
(ll) As
of the
Closing Date of the Mortgage Loan, the Mortgage Property was lawfully occupied
under applicable law, and all inspections, licenses and certificates required
to
be made or issued with respect to all occupied portions of the Mortgaged
Property and, with respect to the use and occupancy of the same, including
but
not limited to certificates of occupancy and fire underwriting certificates,
have been made or obtained from the appropriate authorities;
(mm) There
is
no pending action or proceeding directly involving the Mortgaged Property
in
which compliance with any environmental law, rule or regulation is an issue;
there is no violation of any environmental law, rule or regulation with
respect
to the Mortgaged Property; and the Company has not received any notice
of any
environmental hazard on the Mortgaged Property and nothing further remains
to be
done to satisfy in full all requirements of each such law, rule or regulation
constituting a prerequisite to use and enjoyment of said property;
(nn) The
Mortgagor has not notified the Company, and the Company has no knowledge
of any
relief requested or allowed to the Mortgagor under the Soldiers' and Sailors'
Civil Relief Act of 1940;
(oo)
No
Mortgage Loan is a construction or rehabilitation Mortgage Loan or was
made to
facilitate the trade-in or exchange of a Mortgaged Property;
(pp) The
Mortgagor for each Mortgage Loan is a natural person;
(qq) None
of
the Mortgage Loans are Co-op Loans;
(rr)
With
respect to each Mortgage Loan that has a prepayment penalty feature, each
such
prepayment penalty is enforceable and will be enforced by the Company and
each
prepayment penalty is permitted pursuant to federal, state and local law.
No
Mortgage Loan will impose a prepayment penalty for a term in excess of
five
years from the date such Mortgage Loan was originated. Except as otherwise
set
forth on the Mortgage Loan Schedule, with respect to each Mortgage Loan
that
contains a prepayment penalty, such prepayment penalty is at least equal
to the
lesser of (A) the maximum amount permitted under applicable law and (B)
six
months interest at the related Mortgage Interest Rate on the amount prepaid
in
excess of 20% of the original principal balance of such Mortgage
Loan;
(ss)
With
respect to each Mortgage Loan either (i) the fair market value of the Mortgaged
Property securing such Mortgage Loan was at least equal to 80 percent of
the
original principal balance of such Mortgage Loan at the time such Mortgage
Loan
was originated or (ii) (a) the Mortgage Loan is only secured by the Mortgage
Property and (b) substantially all of the proceeds of such Mortgage Loan
were
used to acquire or to improve or protect the Mortgage Property. For the
purposes
of the preceding sentence, if the Mortgage Loan has been significantly
modified
other than as a result of a default or a reasonable foreseeable default,
the
modified Mortgage Loan will be viewed as having been originated on the
date of
the modification;
(tt)
The
Mortgage Loan was originated by a mortgagee approved by the Secretary of
Housing
and Urban Development pursuant to sections 203 and 211 of the National
Housing
Act, a savings and loan association, a savings bank, a commercial bank,
credit
union, insurance company or similar institution which is supervised and
examined
by a federal or state authority;
(uu)
None
of the Mortgage Loans are simple interest Mortgage Loans and none of the
Mortgaged Properties are timeshares;
(vv)
All
of the terms of the Mortgage pertaining to interest rate adjustments, payment
adjustments and adjustments of the outstanding principal balance are
enforceable, all such adjustments have been properly made, including the
mailing
of required notices, and such adjustments do not and will not affect the
priority of the Mortgage lien. With respect to each Mortgage Loan which
has
passed its initial Adjustment Date, Company has performed an audit of the
Mortgage Loan to determine whether all interest rate adjustments have been
made
in accordance with the terms of the Mortgage Note and Mortgage; and
(ww)
Each
Mortgage Note, each Mortgage, each Assignment and any other documents required
pursuant to this Agreement to be delivered to the Purchaser or its designee,
or
its assignee for each Mortgage Loan, have been, on or before the related
Closing
Date, delivered to the Purchaser or its designee, or its assignee.
Section
3.03 Repurchase;
Substitution.
It
is
understood and agreed that the representations and warranties set forth
in
Sections 3.01 and 3.02 shall survive the sale of the Mortgage Loans and
delivery
of the Mortgage Loan Documents to the Purchaser, or its designee, and shall
inure to the benefit of the Purchaser, notwithstanding any restrictive
or
qualified endorsement on any Mortgage Note or Assignment or the examination,
or
lack of examination, of any Mortgage File. Upon discovery by either the
Company
or the Purchaser of a breach of any of the foregoing representations and
warranties which materially and adversely affects the value of the Mortgage
Loans or the interest of the Purchaser in any Mortgage Loan, the party
discovering such breach shall give prompt written notice to the other.
The
Company shall have a period of sixty (60) days from the earlier of its
discovery
or its receipt of notice of any such breach within which to correct or
cure such
breach. The Company hereby covenants and agrees that if any such breach
is not
corrected or cured within such sixty day period, the Company shall, at
the
Purchaser's option and not later than ninety (90) days of its discovery
or its
receipt of notice of such breach, repurchase such Mortgage Loan at the
Repurchase Price or, with the Purchaser's prior consent and at Purchaser’s sole
option, substitute a Mortgage Loan as provided below. In the event that
any such
breach shall involve any representation or warranty set forth in Section
3.01,
and such breach is not cured within sixty (60) days of the earlier of either
discovery by or notice to the Company of such breach, all Mortgage Loans
shall,
at the option of the Purchaser, be repurchased by the Company at the Repurchase
Price. Any such repurchase shall be accomplished by wire transfer of immediately
available funds to Purchaser in the amount of the Repurchase Price.
If
the
Company is required to repurchase any Mortgage Loan pursuant to this Section
3.03, the Company may, with the Purchaser's prior consent and at Purchaser’s
sole option, within ninety (90) days from the related Closing Date, remove
such
defective Mortgage Loan from the terms of this Agreement and substitute
another
mortgage loan for such defective Mortgage Loan, in lieu of repurchasing
such
defective Mortgage Loan. Any substitute Mortgage Loan is subject to Purchaser
acceptability. Any substituted Loans will comply with the representations
and
warranties set forth in this Agreement as of the substitution date
The
Company shall amend the related Mortgage Loan Schedule to reflect the withdrawal
of the removed Mortgage Loan from this Agreement and the substitution of
such
substitute Mortgage Loan therefor. Upon such amendment, the Purchaser shall
review the Mortgage File delivered to it relating to the substitute Mortgage
Loan. In the event of such a substitution, accrued interest on the substitute
Mortgage Loan for the month in which the substitution occurs and any Principal
Prepayments made thereon during such month shall be the property of the
Purchaser and accrued interest for such month on the Mortgage Loan for
which the
substitution is made and any Principal Prepayments made thereon during
such
month shall be the property of the Company. The principal payment on a
substitute Mortgage Loan due on the Due Date in the month of substitution
shall
be the property of the Company and the principal payment on the Mortgage
Loan
for which the substitution is made due on such date shall be the property
of the
Purchaser.
For
any
month in which the Company is permitted to substitute one or more substitute
Mortgage Loans, the Company will determine the amount (if any) by which
the
aggregate Stated Principal Balance (after application of the principal
portion
of all scheduled payments due in the month of substitution) of all the
substitute Mortgage Loans in the month of substitution is less then the
aggregate Stated Principal Balance (after application of the principal
portion
of the scheduled payment due in the month of substitution) of the such
replaced
Mortgage Loan. An amount equal to the aggregate of such deficiencies described
in the preceding sentence for any Remittance Date shall be deposited into
the
Custodial Account by the Company on the related Determination Date in the
month
following the calendar month during which the substitution occurred.
It
is
understood and agreed that the obligation of the Company set forth in this
Section 3.03 to cure, repurchase or substitute for a defective Mortgage
Loan,
and to indemnify Purchaser pursuant to Section 8.01, constitute the sole
remedies of the Purchaser respecting a breach of the foregoing representations
and warranties. If the Company fails to repurchase or substitute for a
defective
Mortgage Loan in accordance with this Section 3.03, or fails to cure a
defective
Mortgage Loan to Purchaser's reasonable satisfaction in accordance with
this
Section 3.03, or to indemnify Purchaser pursuant to Section 8.01, that
failure
shall be an Event of Default and the Purchaser shall be entitled to pursue
all
remedies available in this Agreement as a result thereof. No provision
of this
paragraph shall affect the rights of the Purchaser to terminate this Agreement
for cause, as set forth in Sections 10.01 and 11.01.
Any
cause
of action against the Company relating to or arising out of the breach
of any
representations and warranties made in Sections 3.01 and 3.02 shall accrue
as to
any Mortgage Loan upon (i) the earlier of discovery of such breach by the
Company or notice thereof by the Purchaser to the Company, (ii) failure
by the
Company to cure such breach or repurchase such Mortgage Loan as specified
above,
and (iii) demand upon the Company by the Purchaser for compliance with
this
Agreement.
In
the
event that any Mortgage Loan is held by a REMIC, notwithstanding any contrary
provision of this Agreement, with respect to any Mortgage Loan that is
not in
default or as to which no default is imminent, no substitution pursuant
to
Subsection 3.03 shall be made after the applicable REMIC's "start up day"
(as
defined in Section 860G(a) (9) of the Code), unless the Company has obtained
an
Opinion of Counsel to the effect that such substitution will not (i) result
in
the imposition of taxes on "prohibited transactions" of such REMIC (as
defined
in Section 860F of the Code) or otherwise subject the REMIC to tax, or
(ii)
cause the REMIC to fail to qualify as a REMIC at any time.
Section
3.04 Representations
and Warranties of the Purchaser.
The
Purchaser represents, warrants and convenants to the Company that, as of
the
related Closing Date or as of such date specifically provided
herein:
(a)The
Purchaser is a corporation, dully organized validly existing and in good
standing under the laws of the State of Delaware and is qualified to transact
business in, is in good standing under the laws of, and possesses all licenses
necessary for the conduct of its business in, each state in which any Mortgaged
Property is located or is otherwise except or not required under applicable
law
to effect such qualification or license;
(b)The
Purchaser has full power and authority to hold each Mortgage Loan, to purchase
each Mortgage Loan pursuant to this Agreement and the related Term Sheet
and to
execute, deliver and perform, and to enter into and consummate all transactions
contemplated by this Agreement and the related Term Sheet and to conduct
its
business as presently conducted, has duly authorized the execution, delivery
and
performance of this Agreement and the related Term Sheet, has duly executed
and
delivered this Agreement and the related Term Sheet;
(c) None
of
the execution and delivery of this Agreement and the related Term Sheet,
the
purchase of the Mortgage Loans, the consummation of the transactions
contemplated hereby, or the fulfillment of or compliance with the terms
and
conditions of this Agreement and the related Term Sheet will conflict with
any
of the terms, conditions or provisions of the Purchaser’s charter or by-laws or
materially conflict with or result in a material breach of any of the terms,
conditions or provisions
of any legal restriction or any agreement or instrument to which the Purchaser
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 material violation
of
any law, rule, regulation, order, judgment or decree to which the Purchaser
or
its property is subject;
(d) There
is
no litigation pending or to the best of the Purchaser’s knowledge, threatened
with respect to the Purchaser which is reasonably likely to have a material
adverse effect on the purchase of the related Mortgage Loans, the execution,
delivery or enforceability of this Agreement and the related Term Sheet,
or
which is reasonably likely to have a material adverse effect on the financial
condition of the Purchaser;
(e) No
consent, approval, authorization or order of any court or governmental
agency or
body is required for the execution, delivery and performance by the Purchaser
of
or compliance by the Purchaser with this Agreement and the related Term
Sheet,
the purchase of the Mortgage Loans or the consummation of the transactions
contemplated by this Agreement and the related Term Sheet except for consents,
approvals, authorizations and orders which have been obtained;
(f) The
consummation of the transactions contemplated by this Agreement and the
related
Term Sheet is in the ordinary course of business of the Purchaser;
(h) The
Purchaser will treat the purchase of the Mortgage Loans from the Company
as a
purchase for reporting, tax and accounting purposes; and
(i) The
Purchaser does not believe, nor does it have any cause or reason to believe,
that it cannot perform each and every of its covenants contained in this
Agreement and the related Term Sheet.
The
Purchaser shall indemnify the Company and hold it harmless against any
claims,
proceedings, losses, damages, penalties, fines, forfeitures, reasonable
and
necessary legal fees and related costs, judgments, and other costs and
expenses
resulting from a breach by the Purchaser of the representations and warranties
contained in this Section 3.04. It is understood and agreed that the obligations
of the Purchaser set forth in this Section 3.04 to indemnify the Seller
as
provided herein constitute the sole remedies of the Seller respecting a
breach
of the foregoing representations and warranties.
ARTICLE
IV
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
Section
4.01 Company
to Act as Servicer.
The
Company, as independent contract servicer, shall service and administer
the
Mortgage Loans in accordance with this Agreement and the related Term Sheet
and
with Accepted Servicing Practices, and shall have full power and authority,
acting alone, to do or cause to be done any and all things in connection
with
such servicing and administration which the Company may deem necessary
or
desirable and consistent with the terms of this Agreement and the related
Term
Sheet and with Accepted Servicing Practices and exercise the same care
that it
customarily employs for its own account. Except as set forth in this Agreement
and the related Term Sheet, the Company shall service the Mortgage Loans
in
strict compliance with the servicing provisions of the Xxxxxx Xxx Guides
(special servicing option), which include, but are not limited to, provisions
regarding the liquidation of Mortgage Loans, the collection of Mortgage
Loan
payments, the payment of taxes, insurance and other charges, the maintenance
of
hazard insurance with a Qualified Insurer, the maintenance of mortgage
impairment insurance, the maintenance of fidelity bond and errors and omissions
insurance, inspections, the restoration of Mortgaged Property, the maintenance
of Primary Mortgage Insurance Policies, insurance claims, the title, management
and disposition of REO Property, permitted withdrawals with respect to
REO
Property, liquidation reports, and reports of foreclosures and abandonments
of
Mortgaged Property, the transfer of Mortgaged Property, the release of
Mortgage
Files, annual statements, and examination of records and facilities. In
the
event of any conflict, inconsistency or discrepancy between any of the
servicing
provisions of this Agreement and the related Term Sheet and any of the
servicing
provisions of the Xxxxxx Mae Guides, the provisions of this Agreement and
the
related Term Sheet shall control and be binding upon the Purchaser and
the
Company.
Consistent
with the terms of this Agreement and the related Term Sheet, the Company
may
waive, modify or vary any term of any Mortgage Loan or consent to the
postponement of any such term or in any manner grant indulgence to any
Mortgagor
if in the Company's reasonable and prudent determination such waiver,
modification, postponement or indulgence is not materially adverse to the
Purchaser, provided, however, that unless the Company has obtained the
prior
written consent of the Purchaser, the Company shall not permit any modification
with respect to any Mortgage Loan that would change the Mortgage Interest
Rate,
defer for more than ninety days or forgive any payment of principal or
interest,
reduce or increase the outstanding principal balance (except for actual
payments
of principal) or change the final maturity date on such Mortgage Loan.
In the
event of any such modification which has been agreed to in writing by the
Purchaser and which permits the deferral of interest or principal payments
on
any Mortgage Loan, the Company shall, on the Business Day immediately preceding
the Remittance Date in any month in which any such principal or interest
payment
has been deferred, deposit in the Custodial Account from its own funds,
in
accordance with Section 4.04, the difference between (a) such month's principal
and one month's interest at the Mortgage Loan Remittance Rate on the unpaid
principal balance of such Mortgage Loan and (b) the amount paid by the
Mortgagor. The Company shall be entitled to reimbursement for such advances
to
the same extent as for all other advances pursuant to Section 4.05. Without
limiting the generality of the foregoing, the Company shall continue, and
is
hereby authorized and empowered, to prepare, execute and deliver, 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. Notwithstanding anything
herein to the contrary, the Company may not enter into a forbearance agreement
or similar arrangement with respect to any Mortgage Loan which runs more
than
180 days after the first delinquent Due Date. Any such agreement shall
be
approved by Purchaser and, if required, by the Primary Mortgage Insurance
Policy
insurer, if required.
Notwithstanding
anything to the contrary contained in this Agreement, the Company shall
not make
or permit any modification, waiver or amendment of any term of any Mortgage
Loan
that would cause any REMIC created under the trust agreement pursuant to
any
Reconstitution to fail to qualify as a REMIC or result in the imposition
of any
tax under Section 860F(a) or Section 860G(d) of the Code.
The
Company shall not permit the creation of any “interests” (within the meaning of
Section 860G of the Code) in any REMIC. The Company shall not enter into
any
arrangement by which a REMIC will receive a fee or other compensation for
services nor permit a REMIC to receive any income from assets other than
“qualified mortgages” as defined in Section 860G(a)(3) of the Code or “permitted
investments” as defined in Section 860G(a)(5) of the Code.
In
servicing and administering the Mortgage Loans, the Company shall employ
Accepted Servicing Practices, giving due consideration to the Purchaser's
reliance on the Company. Unless a different time period is stated in this
Agreement or the related Term Sheet, Purchaser shall be deemed to have
given
consent in connection with a particular matter if Purchaser does not
affirmatively grant or deny consent within five (5) Business Days from
the date
Purchaser receives a second written request for consent for such matter
from
Company as servicer.
The
Mortgage Loans may be subserviced by a Subservicer on behalf of the Company
provided that the Subservicer is an entity that engages in the business
of
servicing loans, and in either case shall be authorized to transact business,
and licensed to service mortgage loans, in the state or states where the
related
Mortgaged Properties it is to service are situated, if and to the extent
required by applicable law to enable the Subservicer to perform its obligations
hereunder and under the Subservicing Agreement, and in either case shall
be a
FHLMC or Xxxxxx Xxx approved mortgage servicer in good standing, and no
event
has occurred, including but not limited to a change in insurance coverage,
which
would make it unable to comply with the eligibility requirements for lenders
imposed by Xxxxxx Mae or for seller/servicers imposed by Xxxxxx Xxx or
FHLMC, or
which would require notification to Xxxxxx Mae or FHLMC. In addition, each
Subservicer will obtain and preserve its qualifications to do business
as a
foreign corporation and its licenses to service mortgage loans, in each
jurisdiction in which such qualifications and/or licenses are or shall
be
necessary to protect the validity and enforceability of this Agreement,
or any
of the Mortgage Loans and to perform or cause to be performed its duties
under
the related Subservicing Agreement. The Company may perform any of its
servicing
responsibilities hereunder or may cause the Subservicer to perform any
such
servicing responsibilities on its behalf, but the use by the Company of
the
Subservicer shall not release the Company from any of its obligations hereunder
and the Company shall remain responsible hereunder for all acts and omissions
of
the Subservicer as fully as if such acts and omissions were those of the
Company. The Company shall pay all fees and expenses of the Subservicer
from its
own funds, and the Subservicer's fee shall not exceed the Servicing Fee.
Company
shall notify Purchaser promptly in writing upon the appointment of any
Subservicer.
At
the
cost and expense of the Company, without any right of reimbursement from
the
Custodial Account, the Company shall be entitled to terminate the rights
and
responsibilities of the Subservicer and arrange for any servicing
responsibilities to be performed by a successor subservicer meeting the
requirements in the preceding paragraph, provided, however, that nothing
contained herein shall be deemed to prevent or prohibit the Company, at
the
Company's option, from electing to service the related Mortgage Loans itself.
In
the event that the Company's responsibilities and duties under this Agreement
are terminated pursuant to Section 4.13, 8.04, 9.01 or 10.01 and if requested
to
do so by the Purchaser, the Company shall at its own cost and expense terminate
the rights and responsibilities of the Subservicer effective as of the
date of
termination of the Company. The Company shall pay all fees, expenses or
penalties necessary in order to terminate the rights and responsibilities
of the
Subservicer from the Company's own funds without reimbursement from the
Purchaser.
Notwithstanding
any of the provisions of this Agreement relating to agreements or arrangements
between the Company and the Subservicer or any reference herein to actions
taken
through the Subservicer or otherwise, the Company shall not be relieved
of its
obligations to the Purchaser and shall be obligated to the same extent
and under
the same terms and conditions as if it alone were servicing and administering
the Mortgage Loans. The Company shall be entitled to enter into an agreement
with the Subservicer for indemnification of the Company by the Subservicer
and
nothing contained in this Agreement shall be deemed to limit or modify
such
indemnification. The Company will indemnify and hold Purchaser harmless
from any
loss, liability or expense arising out of its use of a Subservicer to perform
any of its servicing duties, responsibilities and obligations
hereunder.
Any
Subservicing Agreement and any other transactions or services relating
to the
Mortgage Loans involving the Subservicer shall be deemed to be between
the
Subservicer and Company alone, and the Purchaser shall have no obligations,
duties or liabilities with respect to the Subservicer including no obligation,
duty or liability of Purchaser to pay the Subservicer's fees and expenses.
For
purposes of distributions and advances by the Company pursuant to this
Agreement, the Company shall be deemed to have received a payment on a
Mortgage
Loan when the Subservicer has received such payment.
Section
4.02 Collection
of Mortgage Loan Payments.
Continuously
from the date hereof until the date each Mortgage Loan ceases to be subject
to
this Agreement, the Company will proceed diligently to collect all payments
due
under each Mortgage Loan when the same shall become due and payable and
shall,
to the extent such procedures shall be consistent with this Agreement,
Accepted
Servicing Practices, and the terms and provisions of any related Primary
Mortgage Insurance Policy, follow such collection procedures as it follows
with
respect to mortgage loans comparable to the Mortgage Loans and held for
its own
account. Further, the Company will take special care in ascertaining and
estimating annual escrow payments, and all other charges that, as provided
in
the Mortgage, will become due and payable, so that the installments payable
by
the Mortgagors will be sufficient to pay such charges as and when they
become
due and payable.
In
no
event will the Company waive its right to any prepayment penalty or premium
without the prior written consent of Purchaser and Company will use diligent
efforts to collect same when due except as otherwise provided in the prepayment
penalty provisions provided in the Mortgage Loan Documents.
Section
4.03 Realization
Upon Defaulted Mortgage
The
Company shall use its best efforts, consistent with the procedures that
the
Company would use in servicing loans for its own account, consistent with
Accepted Servicing Practices, any Primary Mortgage Insurance Policies and
the
best interest of Purchaser, to foreclose upon or otherwise comparably convert
the ownership of properties securing such of the Mortgage Loans as come
into and
continue in default and as to which no satisfactory arrangements can be
made for
collection of delinquent payments pursuant to Section 4.01. Foreclosure
or
comparable proceedings shall be initiated within ninety (90) days of default
for
Mortgaged Properties for which no satisfactory arrangements can be made
for
collection of delinquent payments, subject to state and federal law and
regulation. The Company shall use its best efforts to realize upon defaulted
Mortgage Loans in such manner as will maximize the receipt of principal
and
interest by the Purchaser, taking into account, among other things, the
timing
of foreclosure proceedings. The foregoing is subject to the provisions
that, in
any case in which a Mortgaged Property shall have suffered damage, the
Company
shall not be required to expend its own funds toward the restoration of
such
property unless it shall determine in its discretion (i) that such restoration
will increase the proceeds of liquidation of the related Mortgage Loan
to the
Purchaser after reimbursement to itself for such expenses, and (ii) that
such
expenses will be recoverable by the Company through Insurance Proceeds
or
Liquidation Proceeds from the related Mortgaged Property, as contemplated
in
Section 4.05. Company shall obtain prior approval of Purchaser as to repair
or
restoration expenses in excess of ten thousand dollars ($10,000). The Company
shall notify the Purchaser in writing of the commencement of foreclosure
proceedings and not less than 5 days prior to the acceptance or rejection
of any
offer of reinstatement. The Company shall be responsible for all costs
and
expenses incurred by it in any such proceedings or functions; provided,
however,
that it shall be entitled to reimbursement thereof from the related property,
as
contemplated in Section 4.05. Notwithstanding anything to the contrary
contained
herein, in connection with a foreclosure or acceptance of a deed in lieu
of
foreclosure, in the event the Company 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, such an inspection or review is to be conducted
by a
qualified inspector at the Purchaser's expense. Upon completion of the
inspection, the Company 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 Company shall
proceed
with respect to the Mortgaged Property.
Notwithstanding
anything to the contrary contained herein, the Purchaser may, at the Purchaser's
sole option, terminate the Company as servicer of any Mortgage Loan which
becomes ninety (90) days or greater delinquent in payment of a scheduled
Monthly
Payment, without payment of any termination fee with respect thereto, provided
that the Company shall on the date said termination takes effect be reimbursed
for any unreimbursed Monthly Advances of the Company's funds made pursuant
to
Section 5.03 and any unreimbursed Servicing Advances and Servicing Fees
in each
case relating to the Mortgage Loan underlying such delinquent Mortgage
Loan
notwithstanding anything to the contrary set forth in Section 4.05. In
the event
of any such termination, the provisions of Section 11.01 hereof shall apply
to
said termination and the transfer of servicing responsibilities with respect
to
such delinquent Mortgage Loan to the Purchaser or its designee.
If
a
REMIC election has been made with respect to the arrangement under which
the
Mortgage Loans and REO Property are held, the Company shall not take any
action,
cause the REMIC to take any action or fail to take (or fail to cause to
be
taken) any action that, under the REMIC Provisions, if taken or not taken,
as
the case may be, could (i) endanger the status of the REMIC as a REMIC
or (ii)
result in the imposition of a tax upon the REMIC (including but not limited
to
the tax on “prohibited transactions” as defined Section 860G(a)(2) of the Code
and the tax on “contributions” to a REMIC set forth in Section 860(D) of the
Code) unless the Company has received an Opinion of Counsel (at the expense
of
the party seeking to take such action) to the effect that the contemplated
action will not endanger such REMIC status or result in the imposition
of any
such tax.
Section
4.04 Establishment
of Custodial Accounts; Deposits in Custodial Accounts.
The
Company shall segregate and hold all funds collected and received pursuant
to
each Mortgage Loan separate and apart from any of its own funds and general
assets and shall establish and maintain one or more Custodial Accounts.
The
Custodial Account shall be an Eligible Account. Funds shall be deposited
in the
Custodial Account within 48 hours of receipt, and shall at all times be
insured
by the FDIC up to the FDIC insurance limits, or must be invested in Permitted
Investments for the benefit of the Purchaser. Funds deposited in the Custodial
Account may be drawn on by the Company in accordance with Section 4.05.
The
creation of any Custodial Account shall be evidenced by a letter agreement
in
the form shown in Exhibit B hereto. The original of such letter agreement
shall
be furnished to the Purchaser on the Closing Date, and upon the request
of any
subsequent Purchaser.
The
Company shall deposit in the Custodial Account on a daily basis, and retain
therein the following payments and collections received or made by it subsequent
to the Cut-off Date, or received by it prior to the Cut-off Date but allocable
to a period subsequent thereto, other than in respect of principal and
interest
on the Mortgage Loans due on or before the Cut-off Date:
(i) all
payments on account of principal, including Principal Prepayments, on the
Mortgage Loans;
(ii)
all
payments on account of interest on the Mortgage Loans adjusted to the Mortgage
Loan Remittance Rate;
(iii)
all
Liquidation Proceeds;
(iv)
any
amounts required to be deposited by the Company in connection with any
REO
Property pursuant to Section 4.13 and in connection therewith, the Company
shall
provide the Purchaser with written detail itemizing all of such
amounts;
(v)
all
Insurance Proceeds including amounts required to be deposited pursuant
to
Sections 4.08, 4.10 and 4.11, other than proceeds to be held in the Escrow
Account and applied to the restoration or repair of the Mortgaged Property
or
released to the Mortgagor in accordance with Accepted Servicing Practices,
the
Mortgage Loan Documents or applicable law;
(vi)
all
Condemnation Proceeds affecting any Mortgaged Property which are not released
to
the Mortgagor in accordance with Accepted Servicing Practices, the loan
documents or applicable law;
(vii)
any
Monthly Advances;
(viii)
with
respect to each full or partial Principal Prepayment, any Prepayment Interest
Shortfalls, to the extent of the Company’s aggregate Servicing Fee received with
respect to the related Prepayment Period;
(ix)
any
amounts required to be deposited by the Company pursuant to Section 4.10
in
connection with the deductible clause in any blanket hazard insurance policy,
such deposit shall be made from the Company's own funds, without reimbursement
therefor; and
(x)
any
amounts required to be deposited in the Custodial Account pursuant to Section
4.01, 4.13 or 6.02.
The
foregoing requirements for deposit in the Custodial Account shall be exclusive,
it being understood and agreed that, without limiting the generality of
the
foregoing, payments in the nature of late payment charges and assumption
fees,
to the extent permitted by Section 6.01, need not be deposited by the Company
in
the Custodial Account. Any interest paid on funds deposited in the Custodial
Account by the depository institution shall accrue to the benefit of the
Company
and the Company shall be entitled to retain and withdraw such interest
from the
Custodial Account pursuant to Section 4.05 (iv). The Purchaser shall not
be
responsible for any losses suffered with respect to investment of funds
in the
Custodial Account.
Section
4.05 Permitted
Withdrawals From the Custodial Account.
The
Company may, from time to time, withdraw from the Custodial Account for
the
following purposes:
(i) to
make
payments to the Purchaser in the amounts and in the manner provided for
in
Section 5.01;
(ii)
to
reimburse itself for Monthly Advances, the Company's right to reimburse
itself
pursuant to this subclause (ii) being limited to amounts received on the
related
Mortgage Loan which represent late collections (net of the related Servicing
Fees) of principal and/or interest respecting (or
to
amounts received on the related Mortgage Loan as a whole if the Monthly
Advance
is made due to a shortfall in a Monthly Payment made by a Mortgagor entitled
to
relief under the Soldiers and Sailors Civil Relief Act of 1940)
respecting which
any
such advance was made, it being understood that, in the case of such
reimbursement, the Company's right thereto shall be prior to the rights
of the
Purchaser, except that, where the Company is required to repurchase a Mortgage
Loan, pursuant to Section 3.03, the Company's right to such reimbursement
shall
be subsequent to the payment to the Purchaser of the Repurchase Price pursuant
to such Section and all other amounts required to be paid to the Purchaser
with
respect to such Mortgage Loan;
(iii)
to
reimburse itself for unreimbursed Servicing Advances and any unpaid Servicing
Fees(or REO administration fees described in Section 4.13), the Company's
right
to reimburse itself pursuant to this subclause (iii) with respect to any
Mortgage Loan being limited to related proceeds from Liquidation Proceeds,
Condemnation Proceeds and Insurance Proceeds in accordance with the relevant
provisions of the Xxxxxx Xxx Guides or as otherwise set forth in this Agreement;
any recovery shall be made upon liquidation of the REO Property;
(iv) to
pay to
itself as part of its servicing compensation (a) any interest earned on
funds in
the Custodial Account (all such interest to be withdrawn monthly not later
than
each Remittance Date), and (b) the Servicing Fee from that portion of any
payment or recovery as to interest with respect to a particular Mortgage
Loan;
(v) to
pay to
itself with respect to each Mortgage Loan that has been repurchased pursuant
to
Section 3.03 all amounts received thereon and not distributed as of the
date on
which the related repurchase price is determined,
(vi) to
transfer funds to another Eligible Account in accordance with Section 4.09
hereof;
(vii) to
remove
funds inadvertently placed in the Custodial Account by the Company;
(vi) to
clear
and terminate the Custodial Account upon the termination of this Agreement;
and
(vii)to
reimburse itself for Nonrecoverable Advances to the extent not reimbursed
pursuant to clause (ii) or clause (iii).
Section
4.06 Establishment
of Escrow Accounts; Deposits
in Escrow Accounts.
The
Company shall segregate and hold all funds collected and received pursuant
to
each Mortgage Loan which constitute Escrow Payments separate and apart
from any
of its own funds and general assets and shall establish and maintain one
or more
Escrow Accounts. The Escrow Account shall be an Eligible Account. Funds
deposited in each Escrow Account shall at all times be insured in a manner
to
provide maximum insurance under the insurance limitations of the FDIC,
or must
be invested in Permitted Investments. Funds
deposited in the Escrow Account may be drawn on by the Company in accordance
with Section 4.07. The creation of any Escrow Account shall be evidenced
by a
letter agreement in the form shown in Exhibit C. The original of such letter
agreement shall be furnished to the Purchaser on the Closing Date, and
upon
request to any subsequent purchaser.
The
Company 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;
(ii) all
Insurance Proceeds which are to be applied to the restoration or repair
of any
Mortgaged Property; and
(iii) all
Servicing Advances for Mortgagors whose Escrow Payments are insufficient
to
cover escrow disbursements.
The
Company shall make withdrawals from the Escrow Account only to effect such
payments as are required under this Agreement, and for such other purposes
as
shall be as set forth or in accordance with Section 4.07. The Company shall
be
entitled to retain any interest paid on funds deposited in the Escrow Account
by
the depository institution other than interest on escrowed funds required
by law
to be paid to the Mortgagor and, to the extent required by law, the Company
shall pay interest on escrowed funds to the Mortgagor notwithstanding that
the
Escrow Account is non-interest bearing or that interest paid thereon is
insufficient for such purposes. The
Purchaser shall not be responsible for any losses suffered with respect
to
investment of funds in the Escrow Account.
Section
4.07 Permitted
Withdrawals From Escrow Account.
Withdrawals
from the Escrow Account may be made by Company only:
(i) to
effect
timely payments of ground rents, taxes, assessments, water rates, Primary
Mortgage Insurance Policy premiums, if applicable, fire and hazard insurance
premiums, condominium assessments and comparable items;
(ii) to
reimburse Company for any Servicing Advance made by Company with respect
to a
related Mortgage Loan but only from amounts received on the related Mortgage
Loan which represent late payments or collections of Escrow Payments
thereunder;
(iii) to
refund
to the Mortgagor any funds as may be determined to be overages;
(iv) for
transfer to the Custodial Account in accordance with the terms of this
Agreement;
(v) for
application to restoration or repair of the Mortgaged Property;
(vi) to
pay to
the Company, or to the Mortgagor to the extent required by law, any interest
paid on the funds deposited in the Escrow Account;
(vii)
to
clear
and terminate the Escrow Account on the termination of this Agreement.
As part
of its servicing duties, the Company shall pay to the Mortgagors interest
on
funds in Escrow Account, to the extent required by law, and to the extent
that
interest earned on funds in the Escrow Account is insufficient, shall pay
such
interest from its own funds, without any reimbursement therefor;
and
(viii)
to
pay to
the Mortgagors or other parties Insurance Proceeds deposited in accordance
with
Section 4.06.
Section
4.08 Payment
of Taxes, Insurance and Other Charges;
Maintenance of Primary Mortgage Insurance
Policies; Collections Thereunder.
With
respect to each Mortgage Loan, the Company shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates
and other
charges which are or may become a lien upon the Mortgaged Property and
the
status of primary mortgage insurance 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 and at a time appropriate for
securing maximum discounts allowable, employing for such purpose deposits
of the
Mortgagor in the Escrow Account which shall have been estimated and accumulated
by the Company in amounts sufficient for such purposes, as allowed under
the
terms of the Mortgage or applicable law. To the extent that the Mortgage
does
not provide for Escrow Payments, the Company shall determine that any such
payments are made by the Mortgagor at the time they first become due. The
Company assumes full responsibility for the timely payment of all such
bills and
shall effect timely payments of all such bills irrespective of the Mortgagor's
faithful performance in the payment of same or the making of the Escrow
Payments
and shall make advances from its own funds to effect such payments.
The
Company will maintain in full force and effect Primary Mortgage Insurance
Policies issued by a Qualified Insurer with respect to each Mortgage Loan
for
which such coverage is herein required. Such coverage will be terminated
only
with the approval of Purchaser, or as required by applicable law or regulation.
The Company will not cancel or refuse to renew any Primary Mortgage Insurance
Policy in effect on the Closing Date that is required to be kept in force
under
this Agreement unless a replacement Primary Mortgage Insurance Policy for
such
canceled or nonrenewed policy is obtained from and maintained with a Qualified
Insurer. The Company shall not take any action which would result in
non-coverage under any applicable Primary Mortgage Insurance Policy of
any loss
which, but for the actions of the Company would have been covered thereunder.
In
connection with any assumption or substitution agreement entered into or
to be
entered into pursuant to Section 6.01, the Company shall promptly notify
the
insurer under the related Primary Mortgage Insurance Policy, if any, of
such
assumption or substitution of liability in accordance with the terms of
such
policy and shall take all actions which may be required by such insurer
as a
condition to the continuation of coverage under the Primary Mortgage Insurance
Policy. If such Primary Mortgage Insurance Policy is terminated as a result
of
such assumption or substitution of liability, the Company shall obtain
a
replacement Primary Mortgage Insurance Policy as provided above.
In
connection with its activities as servicer, the Company agrees to prepare
and
present, on behalf of itself and the Purchaser, claims to the insurer under
any
Private Mortgage Insurance Policy in a timely fashion in accordance with
the
terms of such Primary Mortgage Insurance Policy and, in this regard, to
take
such action as shall be necessary to permit recovery under any Primary
Mortgage
Insurance Policy respecting a defaulted Mortgage Loan. Pursuant to Section
4.04,
any amounts collected by the Company under any Primary Mortgage Insurance
Policy
shall be deposited in the Custodial Account, subject to withdrawal pursuant
to
Section 4.05.
Section
4.09 Transfer
of Accounts.
The
Company may transfer the Custodial Account or the Escrow Account to a different
Eligible Account from time to time. Such transfer shall be made only upon
obtaining the prior written consent of the Purchaser, which consent will
not be
unreasonably withheld.
Section
4.10 Maintenance
of Hazard Insurance.
The
Company shall cause to be maintained for each Mortgage Loan fire and hazard
insurance with extended coverage as is acceptable to Xxxxxx Mae or FHLMC
and
customary in the area where the Mortgaged Property is located in an amount
which
is equal to the lesser of (i) the maximum insurable value of the improvements
securing such Mortgage Loan or (ii) the greater of (a) the outstanding
principal
balance of the Mortgage Loan, and (b) an amount such that the proceeds
thereof
shall be sufficient to prevent the Mortgagor and/or the mortgagee from
becoming
a co-insurer. If required by the Flood Disaster Protection Act of 1973,
as
amended, each Mortgage Loan shall be covered by a flood insurance policy
meeting
the requirements of the current guidelines of the Federal Insurance
Administration in effect with an insurance carrier acceptable to Xxxxxx
Xxx or
FHLMC, in an amount representing coverage not less than the least of (i)
the
outstanding principal balance of the Mortgage Loan, (ii) the maximum insurable
value of the improvements securing such Mortgage Loan or (iii) the maximum
amount of insurance which is available under the Flood Disaster Protection
Act
of 1973, as amended. If at any time during the term of the Mortgage Loan,
the
Company determines in accordance with applicable law and pursuant to the
Xxxxxx
Mae Guides that 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 Flood Disaster Protection Act of 1973, as amended,
the
Company 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 Company shall immediately force place the required flood insurance
on the
Mortgagor’s behalf. The Company 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, and, to the extent required and available under the Flood Disaster
Protection Act of 1973, as amended, flood insurance in an amount as provided
above. Any amounts collected by the Company under any such policies other
than
amounts to be deposited in the Escrow Account and applied to the restoration
or
repair of the Mortgaged Property or REO Property, or released to the Mortgagor
in accordance with Accepted Servicing Practices, shall be deposited in
the
Custodial Account, subject to withdrawal pursuant to Section 4.05. It is
understood and agreed that no other additional insurance need be required
by the
Company of the Mortgagor or maintained on property acquired in respect
of the
Mortgage Loan, other than pursuant to this Agreement, the Xxxxxx Xxx Guides
or
such applicable state or federal laws and regulations as shall at any time
be in
force and as shall require such additional insurance. All such policies
shall be
endorsed with standard mortgagee clauses with loss payable to the Company
and
its successors and/or assigns and shall provide for at least thirty days
prior
written notice of any cancellation, reduction in the amount or material
change
in coverage to the Company. The Company shall not interfere with the Mortgagor's
freedom of choice in selecting either his insurance carrier or agent, provided,
however, that the Company shall not accept any such insurance policies
from
insurance companies unless such companies are Qualified Insurers.
Section
4.11 Maintenance
of Mortgage Impairment Insurance Policy.
In
the
event that the Company shall obtain and maintain a blanket policy issued
by a
Qualified Insurer insuring against hazard losses on all of the Mortgage
Loans,
then, to the extent such policy provides coverage in an amount equal to
the
amount required pursuant to Section 4.10 and otherwise complies with all
other
requirements of Section 4.10, it shall conclusively be deemed to have satisfied
its obligations as set forth in Section 4.10, it being understood and agreed
that such policy may contain a deductible clause, in which case the Company
shall, in the event that there shall not have been maintained on the related
Mortgaged Property or REO Property a policy complying with Section 4.10,
and
there shall have been a loss which would have been covered by such policy,
deposit in the Custodial Account the amount not otherwise payable under
the
blanket policy because of such deductible clause. In connection with its
activities as servicer of the Mortgage Loans, the Company agrees to prepare
and
present, on behalf of the Purchaser, claims under any such blanket policy
in a
timely fashion in accordance with the terms of such policy. Upon request
of the
Purchaser, the Company shall cause to be delivered to the Purchaser a certified
true copy of such policy and shall use its best efforts to obtain a statement
from the insurer thereunder that such policy shall in no event be terminated
or
materially modified without thirty (30) days' prior written notice to the
Purchaser.
Section
4.12 Fidelity
Bond, Errors and Omissions Insurance.
The
Company shall maintain, at its own expense, a blanket fidelity bond and
an
errors and omissions insurance policy, with broad coverage with responsible
companies on all officers, employees or other persons acting in any capacity
with regard to the Mortgage Loan to handle funds, money, documents and
papers
relating to the Mortgage Loan. The Fidelity Bond shall be in the form of
the
Mortgage Banker's Blanket Bond and shall protect and insure the Company
against
losses, including forgery, theft, embezzlement and fraud of such persons.
The
errors and omissions insurance shall protect and insure the Company against
losses arising out of errors and omissions and negligent acts of such persons.
Such errors and omissions insurance shall also protect and insure the Company
against losses in connection with the failure to maintain any insurance
policies
required pursuant to this Agreement and the release or satisfaction of
a
Mortgage Loan without having obtained payment in full of the indebtedness
secured thereby. No provision of this Section 4.12 requiring the Fidelity
Bond
or errors and omissions insurance shall diminish or relieve the Company
from its
duties and obligations as set forth in this Agreement. The minimum coverage
under any such bond and insurance policy shall be at least equal to the
corresponding amounts required by Xxxxxx Mae in the Xxxxxx Xxx Guides.
Upon
request by the Purchaser, the Company shall deliver to the Purchaser a
certificate from the surety and the insurer as to the existence of the
Fidelity
Bond and errors and omissions insurance policy and shall obtain a statement
from
the surety and the insurer that such Fidelity Bond or insurance policy
shall in
no event be terminated or materially modified without thirty (30) days'
prior
written notice to the Purchaser. The Company shall notify the Purchaser
within
five (5) business days of receipt of notice that such Fidelity Bond or
insurance
policy will be, or has been, materially modified or terminated. The Purchaser
(or any party having the status of Purchaser hereunder) and any subsidiary
thereof and their successors or assigns as their interests may appear must
be
named as loss payees on the Fidelity Bond and as additional insured on
the
errors and omissions policy. Upon request by Purchaser, Company shall provide
Purchaser with an insurance certificate certifying coverage under this
Section
4.12, and will provide an update to such certificate upon request, or upon
renewal or material modification of coverage.
Section
4.13 Title,
Management and Disposition of REO Property.
In
the
event that title to the Mortgaged Property is acquired in foreclosure or
by deed
in lieu of foreclosure, the deed or certificate of sale shall be taken
in the
name of the Purchaser or its designee, or in the event the Purchaser or
its
designee 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 Company
from an
attorney duly licensed to practice law in the state where the REO Property
is
located. Any Person or Persons holding such title other than the Purchaser
shall
acknowledge in writing that such title is being held as nominee for the
benefit
of the Purchaser.
The
Company shall notify the Purchaser in accordance with the Xxxxxx Xxx Guides
of
each acquisition of REO Property upon such acquisition (and, in any event,
shall
provide notice of the consummation of any foreclosure sale within three
(3)
Business Days of the date Company receives notice of such consummation),
together with a copy of the drive by appraisal or brokers price opinion
of the
Mortgaged Property obtained in connection with such acquisition. The Purchaser
shall thereafter assume the responsibility for marketing such REO property
and
shall be disposed of by the Purchaser. No Servicing Fee shall be assessed
or
otherwise accrue on any REO Property from and after the date on which it
becomes
an REO Property.
The
Company shall, either itself or through an agent selected by the Company,
and in
accordance with the Xxxxxx Mae Guides manage, conserve, protect and operate
each
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,
until
such time the REO Property is conveyed to the Purchaser for final disposition.
The Company shall cause each REO Property to be inspected promptly upon
the
acquisition of title thereto and shall cause each REO Property to be inspected
at least monthly thereafter or more frequently as required by the circumstances.
The Company shall make or cause to be made a written report of each such
inspection and such reports shall be retained in the Mortgage File. The
Company
shall file
all
necessary mortgage insurance claims.
Section
4.14 Notification
of Maturity Date.
With
respect to each Mortgage Loan, the Company shall execute and deliver to
the
Mortgagor any and all necessary notices required under applicable law and
the
terms of the related Mortgage Note and Mortgage regarding the maturity
date if
required under applicable law.
ARTICLE
V
PAYMENTS
TO THE PURCHASER
Section
5.01 Distributions.
On
each
Remittance Date, the Company shall distribute by wire transfer of immediately
available funds to the Purchaser (i) all amounts credited to the Custodial
Account as of the close of business on the preceding Determination Date,
net of
charges against or withdrawals from the Custodial Account pursuant to Section
4.05, plus (ii) all Monthly Advances, if any, which the Company is obligated
to
distribute pursuant to Section 5.03, plus, (iii) interest at the Mortgage
Loan
Remittance Rate on any Principal Prepayment from the date of such Principal
Prepayment through the end of the month for which disbursement is made
provided
that the Company’s obligation as to payment of such interest shall be limited to
the Servicing Fee earned during the month of the distribution, minus (iv)
any
amounts attributable to Monthly Payments collected but due on a Due Date
or
Dates subsequent to the preceding Determination Date, which amounts shall
be
remitted on the Remittance Date next succeeding the Due Period for such
amounts.
It is understood that, by operation of Section 4.04, the remittance on
the first
Remittance Date with respect to Mortgage Loans purchased pursuant to the
related
Term Sheet is to include principal collected after the Cut-off Date through
the
preceding Determination Date plus interest, adjusted to the Mortgage Loan
Remittance Rate collected through such Determination Date exclusive of
any
portion thereof allocable to the period prior to the Cut-off Date, with
the
adjustments specified in clauses (ii), (iii) and (iv) above.
With
respect to any remittance received by the Purchaser after the Remittance
Date,
the Company 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 three (3) percentage points, but in no event greater than the maximum
amount permitted by applicable law. Such interest shall cover the period
commencing with the day following the Business Day such payment was due
and
ending with the Business Day on which such payment is made to the Purchaser,
both inclusive. The payment by the Company of any such interest shall not
be
deemed an extension of time for payment or a waiver of any Event of Default
by
the Company. On each Remittance Date, the Company shall provide a remittance
report detailing all amounts being remitted pursuant to this Section
5.01.
Section
5.02 Statements
to the Purchaser.
The
Company shall furnish to Purchaser an individual loan accounting report,
as of
the last Business Day of each month, in the Company's assigned loan number
order
to document Mortgage Loan payment activity on an individual Mortgage Loan
basis.
With respect to each month, the corresponding individual loan accounting
report
shall be received by the Purchaser no later than the fifth Business Day
of the
following month on a disk or tape or other computer-readable format in
such
format as may be mutually agreed upon by both Purchaser and Company, and
no
later than the fifth Business Day of the following month in hard copy,
and shall
contain the following:
(i)
With
respect to each Monthly Payment, the amount of such remittance allocable
to
principal (including a separate breakdown of any Principal Prepayment,
including
the date of such prepayment, and any prepayment penalties or premiums,
along
with a detailed report of interest on principal prepayment amounts remitted
in
accordance with Section 4.04);
(ii)
with
respect to each Monthly Payment, the amount of such remittance allocable
to
interest;
(iii)
the
amount of servicing compensation received by the Company during the prior
distribution period;
(iv)
the
aggregate Stated Principal Balance of the Mortgage Loans;
(v)
the
aggregate of any expenses reimbursed to the Company during the prior
distribution period pursuant to Section 4.05;
(vi)
The
number and aggregate outstanding principal balances of Mortgage Loans (a)
delinquent (1) 30 to 59 days, (2) 60 to 89 days, (3) 90 days or more; (b)
as to
which foreclosure has commenced; and (c) as to which REO Property has been
acquired; and
The
Company shall also provide a trial balance, sorted in Purchaser's assigned
loan
number order, in the form of Exhibit E hereto, with each such
Report.
The
Company shall prepare and file any and all information statements or other
filings required to be delivered to any governmental taxing authority or
to
Purchaser pursuant to any applicable law with respect to the Mortgage Loans
and
the transactions contemplated hereby. In addition, the Company shall provide
Purchaser with such information concerning the Mortgage Loans as is necessary
for Purchaser to prepare its federal income tax return as Purchaser may
reasonably request from time to time.
In
addition, not more than sixty (60) days after the end of each calendar
year, the
Company shall furnish to each Person who was a Purchaser at any time during
such
calendar year 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.
Section
5.03 Monthly
Advances by the Company.
Not
later
than the close of business on the Business Day preceding each Remittance
Date,
the Company shall deposit in the Custodial Account an amount equal to all
payments not previously advanced by the Company, whether or not deferred
pursuant to Section 4.01, of principal (due after the Cut-off Date) and
interest
not allocable to the period prior to the Cut-off Date, adjusted to the
Mortgage
Loan Remittance Rate, which were due on a Mortgage Loan and delinquent
at the
close of business on the related Determination Date;
provided, however that the Company shall not be obligated to advance any
shortfall arising as a result of application of the Soldiers’ and Sailors’ Civil
Relief Act of 1940 to any Mortgage Loan. .
The
Company's obligation to make such Monthly Advances as to any Mortgage Loan
will
continue through the last Monthly Payment due prior to the payment in full
of
the Mortgage Loan, or through the Remittance Date prior to the date on
which the
Mortgaged Property liquidates (including Insurance Proceeds, proceeds from
the
sale of REO Property or Condemnation Proceeds) with respect to the Mortgage
Loan
unless the Company deems such advance to be a Nonrecoverable Advance. In
such
event, the Company shall deliver to the Purchaser an Officer's Certificate
of
the Company to the effect that an officer of the Company has reviewed the
related Mortgage File and has made the reasonable determination that any
additional advances are nonrecoverable.
Section
5.04 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 Company shall
submit to
the Purchaser a liquidation report with respect to such Mortgaged Property
in a
form mutually acceptable to Company and Purchaser. The Company shall also
provide reports on the status of REO Property containing such information
as
Purchaser may reasonably require.
Section
5.05 Prepayment
Interest Shortfalls.
Not
later
than the close of business on the Business Day preceding each Remittance
Date in
the month following the related Prepayment Period, the Company shall deposit
in
the Custodial Account an amount equal to any Prepayment Interest Shortfalls
with
respect to such Prepayment Period, which in the aggregate shall not exceed
the
Company’s aggregate Servicing Fee received with respect to the related Due
Period.
ARTICLE
VI
GENERAL
SERVICING PROCEDURES
Section
6.01 Assumption
Agreements.
The
Company will, to the extent it has knowledge of any conveyance or prospective
conveyance by any Mortgagor of the Mortgaged Property (whether by absolute
conveyance or by contract of sale, and whether or not the Mortgagor remains
or
is to remain liable under the Mortgage Note and/or the Mortgage), exercise
its
rights to accelerate the maturity of such Mortgage Loan under any "due-on-sale"
clause to the extent permitted by law; provided, however, that the Company
shall
not exercise any such rights if prohibited by law or the terms of the Mortgage
Note from doing so or if the exercise of such rights would impair or threaten
to
impair any recovery under the related Primary Mortgage Insurance Policy,
if any.
If the Company reasonably believes it is unable under applicable law to
enforce
such "due-on-sale" clause, the Company, with the approval of the Purchaser,
will
enter into an assumption agreement with the person to whom the Mortgaged
Property has been conveyed or is proposed to be conveyed, pursuant to which
such
person becomes liable under the Mortgage Note and, to the extent permitted
by
applicable state law, the Mortgagor remains liable thereon. Where an assumption
is allowed pursuant to this Section 6.01, the Company, with the prior consent
of
the Purchaser and the primary mortgage insurer, if any, is authorized to
enter
into a substitution of liability agreement with the person to whom the
Mortgaged
Property has been conveyed or is proposed to be conveyed pursuant to which
the
original mortgagor is released from liability and such Person is substituted
as
mortgagor and becomes liable under the related Mortgage Note. Any such
substitution of liability agreement shall be in lieu of an assumption agreement.
In
connection with any such assumption or substitution of liability, the Company
shall follow the underwriting practices and procedures of the Company.
With
respect to an assumption or substitution of liability, the Mortgage Interest
Rate borne by the related Mortgage Note, the amount of the Monthly Payment
and
the maturity date may not be changed (except pursuant to the terms of the
Mortgage Note). If the credit of the proposed transferee does not meet
such
underwriting criteria, the Company diligently shall, to the extent permitted
by
the Mortgage or the Mortgage Note and by applicable law, accelerate the
maturity
of the Mortgage Loan. The Company shall notify the Purchaser that any such
substitution of liability or assumption agreement has been completed by
forwarding to the Purchaser the original of any such substitution of liability
or assumption agreement, which document shall be added to the related Mortgage
File and shall, for all purposes, be considered a part of such Mortgage
File to
the same extent as all other documents and instruments constituting a part
thereof. All fees collected by the Company for entering into an assumption
or
substitution of liability agreement shall belong to the Company.
Notwithstanding
the foregoing paragraphs of this Section or any other provision of this
Agreement, the Company shall not be deemed to be in default, breach or
any other
violation of its obligations hereunder by reason of any assumption of a
Mortgage
Loan by operation of law or any assumption which the Company may be restricted
by law from preventing, for any reason whatsoever. For purposes of this
Section
6.01, the term "assumption" is deemed to also include a sale of the Mortgaged
Property subject to the Mortgage that is not accompanied by an assumption
or
substitution of liability agreement.
Section
6.02 Satisfaction
of Mortgages and Release of Mortgage Files.
Upon
the
payment in full of any Mortgage Loan, or the receipt by the Company of
a
notification that payment in full will be escrowed in a manner customary
for
such purposes, the Company will immediately notify the Purchaser by a
certification, which certification shall include a statement to the effect
that
all amounts received or to be received in connection with such payment
which are
required to be deposited in the Custodial Account pursuant to Section 4.04
have
been or will be so deposited, of a Servicing Officer and shall request
delivery
to it of the portion of the Mortgage File held by the Purchaser. The Purchaser
shall no later than five Business Days after receipt of such certification
and
request, release or cause to be released to the Company, the related Mortgage
Loan Documents and, upon its receipt of such documents, the Company shall
promptly prepare and deliver to the Purchaser the requisite satisfaction
or
release. No later than five (5) Business Days following its receipt of
such
satisfaction or release, the Purchaser shall deliver, or cause to be delivered,
to the Company the release or satisfaction properly executed by the owner
of
record of the applicable mortgage or its duly appointed attorney in fact.
No
expense incurred in connection with any instrument of satisfaction or deed
of
reconveyance shall be chargeable to the Custodial Account.
In
the
event the Company satisfies or releases a Mortgage without having obtained
payment in full of the indebtedness secured by the Mortgage or should it
otherwise prejudice any right the Purchaser may have under the mortgage
instruments, the Company, upon written demand, shall remit within two (2)
Business Days to the Purchaser the then outstanding principal balance of
the
related Mortgage Loan by deposit thereof in the Custodial Account. The
Company
shall maintain the Fidelity Bond and errors and omissions insurance insuring
the
Company against any loss it may sustain with respect to any Mortgage Loan
not
satisfied in accordance with the procedures set forth herein.
From
time
to time and as appropriate for the servicing or foreclosure of the Mortgage
Loan, including for the purpose of collection under any Primary Mortgage
Insurance Policy, the Purchaser shall, upon request of the Company and
delivery
to the Purchaser of a servicing receipt signed by a Servicing Officer,
release
the portion of the Mortgage File held by the Purchaser to the Company.
Such
servicing receipt shall obligate the Company to return the related Mortgage
documents to the Purchaser when the need therefor by the Company no longer
exists, unless the Mortgage Loan has been liquidated and the Liquidation
Proceeds relating to the Mortgage Loan have been deposited in the Custodial
Account or the Mortgage File or such document has been delivered to an
attorney,
or to a public trustee or other public official as required by law, for
purposes
of initiating or pursuing legal action or other proceedings for the foreclosure
of the Mortgaged Property either judicially or non-judicially, and the
Company
has delivered to the Purchaser a certificate of a Servicing Officer certifying
as to the name and address of the Person to which such Mortgage File or
such
document was delivered and the purpose or purposes of such delivery. Upon
receipt of a certificate of a Servicing Officer stating that such Mortgage
Loan
was liquidated, the servicing receipt shall be released by the Purchaser
to the
Company.
Section
6.03 Servicing
Compensation.
As
compensation for its services hereunder, the Company shall be entitled
to
withdraw from the Custodial Account (to the extent of interest payments
collected on the Mortgage Loans) or to retain from interest payments collected
on the Mortgage Loans, the amounts provided for as the Company's Servicing
Fee,
subject to payment of compensating interest on Principal Prepayments as
capped
by the Servicing Fee pursuant to Section 5.01 (iii). Additional servicing
compensation in the form of assumption fees, as provided in Section 6.01,
and
late payment charges or otherwise shall be retained by the Company to the
extent
not required to be deposited in the Custodial Account. No Servicing Fee
shall be
payable in connection with partial Monthly Payments. The Company shall
be
required to pay all expenses incurred by it in connection with its servicing
activities hereunder and shall not be entitled to reimbursement therefor
except
as specifically provided for.
Section
6.04 Annual
Statement as to Compliance.
The
Company will deliver to the Purchaser not later than 90 days following
the end
of each fiscal year of the Company beginning in March 2004, an Officers'
Certificate stating, as to each signatory thereof, that (i) a review of
the
activities of the Company during the preceding calendar year and of performance
under this Agreement has been made under such officers' supervision, and
(ii) to
the best of such officers' knowledge, based on such review, the Company
has
fulfilled all of its obligations under this Agreement throughout such year,
or,
if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officers and the nature and
status of
cure provisions thereof. Copies of such statement shall be provided by
the
Company to the Purchaser upon request.
Section
6.05 Annual
Independent Certified Public Accountants' Servicing Report.
Within
ninety (90) days of Company's fiscal year end beginning in March 2004,
the
Company 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 the Purchaser to the effect that such firm has examined
certain documents and records relating to the Company's servicing of mortgage
loans of the same type as the Mortgage Loans pursuant to servicing agreements
substantially similar to this Agreement, which agreements may include this
Agreement, and that, on the basis of such an examination, conducted
substantially in the uniform single audit program for mortgage bankers,
such
firm is of the opinion that the Company's servicing has been conducted
in
compliance with the agreements examined pursuant to this Section 6.05,
except
for (i) such exceptions as such firm shall believe to be immaterial, and
(ii)
such other exceptions as shall be set forth in such statement. Copies of
such
statement shall be provided by the Company to the Purchaser. In addition,
on an
annual basis, Company shall provided Purchaser with copies of its audited
financial statements.
Section
6.06 Purchaser's
Right to Examine Company Records.
The
Purchaser shall have the right to examine and audit upon reasonable notice
to
the Company, during business hours or at such other times as might be reasonable
under applicable circumstances, any and all of the books, records, documentation
or other information of the Company, or held by another for the Company
or on
its behalf or otherwise, which relates to the performance or observance
by the
Company of the terms, covenants or conditions of this Agreement.
The
Company shall provide to the Purchaser and any supervisory agents or examiners
representing a state or federal governmental agency having jurisdiction
over the
Purchaser, including but not limited to OTS, FDIC and other similar entities,
access to any documentation regarding the Mortgage Loans in the possession
of
the Company which may be required by any applicable regulations. Such access
shall be afforded without charge, upon reasonable request, during normal
business hours and at the offices of the Company, and in accordance with
the
FDIC, OTS, or any other similar federal or state regulations, as
applicable.
ARTICLE
VII
REPORTS
TO BE PREPARED BY SERVICER
Section
7.01 Company
Shall Provide Information as Reasonably Required.
The
Company shall furnish to the Purchaser during the term of this Agreement,
such
periodic, special or other reports, information or documentation, whether
or not
provided for herein, as shall be necessary, reasonable or appropriate in
respect
to the Purchaser, or otherwise in respect to the Mortgage Loans and the
performance of the Company under this Agreement, including any reports,
information or documentation reasonably required to comply with any regulations
regarding any supervisory agents or examiners of the Purchaser all such
reports
or information to be as provided by and in accordance with such applicable
instructions and directions as the Purchaser may reasonably request in
relation
to this Agreement or the performance of the Company under this Agreement.
The
Company agrees to execute and deliver all such instruments and take all
such
action as the Purchaser, from time to time, may reasonably request in order
to
effectuate the purpose and to carry out the terms of this
Agreement.
In
connection with marketing the Mortgage Loans, the Purchaser may make available
to a prospective purchaser audited financial statements of the Company
for the
most recently completed two (2) fiscal years for which such statements
are
available, as well as a Consolidated Statement of Condition at the end
of the
last two (2) fiscal years covered by any Consolidated Statement of Operations.
If it has not already done so, the Company shall furnish promptly to the
Purchaser or a prospective purchaser copies of the statements specified
above.
The
Company shall make reasonably available to the Purchaser or any prospective
Purchaser a knowledgeable financial or accounting officer for the purpose
of
answering questions and to permit any prospective purchaser to inspect
the
Company’s servicing facilities for the purpose of satisfying such prospective
purchaser that the Company has the ability to service the Mortgage Loans
as
provided in this Agreement.
ARTICLE
VIII
THE
SERVICER
Section
8.01 Indemnification;
Third Party Claims.
The
Company agrees to indemnify the Purchaser and hold it harmless against
any and
all claims, losses, damages, penalties, fines, forfeitures, legal fees
and
related costs, judgments, and any other costs, fees and expenses that the
Purchaser may sustain in any way related to the failure of the Company
to
observe and perform its duties, obligations, covenants, and agreements
to
service the Mortgage Loans in strict compliance with the terms of this
Agreement. The Company agrees to indemnify the Purchaser and hold it harmless
against any and all claims, losses, damages, penalties, fines, forfeitures,
legal fees and related costs, judgments, and any other costs, fees and
expenses
that the Purchaser may sustain in any way from any claim, demand, defense
or
assertion based on or grounded upon, or resulting from any assertion based
on,
grounded upon or resulting from a breach or alleged breach of any of the
representation or warranty set forth in Sections 3.01 or 3.02 of this Agreement.
The Company shall immediately notify the Purchaser if a claim is made by
a third
party against Company with respect to this Agreement or the Mortgage Loans,
assume (with the consent of the Purchaser) the defense of any such claim
and pay
all expenses in connection therewith, including counsel fees, whether or
not
such claim is settled prior to judgment, and promptly pay, discharge and
satisfy
any judgment or decree which may be entered against it or the Purchaser
in
respect of such claim. The Company shall follow any written instructions
received from the Purchaser in connection with such claim. The Purchaser
shall
promptly reimburse the Company for all amounts advanced by it pursuant
to the
two preceding sentences except when the claim relates to the failure of
the
Company to service and administer the Mortgages in strict compliance with
the
terms of this Agreement, the breach of representation or warranty set forth
in
Sections 3.01 or 3.02, or the negligence, bad faith or willful misconduct
of
Company. The provisions of this Section 8.01 shall survive termination
of this
Agreement.
Section
8.02 Merger
or Consolidation of the Company.
The
Company 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 Company may be merged or consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Company
shall be a party, or any Person succeeding to the business of the Company
whether or not related to loan servicing, shall be the successor of the
Company
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 (i) having a GAAP net worth of not less than $25,000,000,
(ii)
the deposits of which are insured by the FDIC, SAIF and/or BIF, and which
is a
HUD-approved mortgagee whose primary business is in origination and servicing
of
first lien mortgage loans, and (iii) who is a Xxxxxx Xxx or FHLMC approved
seller/servicer in good standing.
Section
8.03 Limitation
on Liability of the Company and Others.
Neither
the Company nor any of the officers, employees or agents of the Company
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 made in good faith; provided, however, that this provision
shall not
protect the Company or any such person against any breach of warranties
or
representations made herein, or failure to perform its obligations in strict
compliance with any standard of care set forth in this Agreement, or any
liability which would otherwise be imposed by reason of negligence, bad
faith or
willful misconduct, or any breach of the terms and conditions of this Agreement.
The Company and any officer, employee or agent of the Company may rely
in good
faith on any document of any kind prima facie properly executed and submitted
by
the Purchaser respecting any matters arising hereunder. The Company 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 reasonable opinion may involve it in any
expenses or liability; provided, however, that the Company may, with the
consent
of the Purchaser, undertake any such action which it may deem necessary
or
desirable in respect to this Agreement and the rights and duties of the
parties
hereto. In such event, the reasonable legal expenses and costs of such
action
and any liability resulting therefrom shall be expenses, costs and liabilities
for which the Purchaser will be liable, and the Company shall be entitled
to be
reimbursed therefor from the Purchaser upon written demand.
Section
8.04 Company
Not to Assign or Resign.
The
Company shall not assign this Agreement or resign from the obligations
and
duties hereby imposed on it except by mutual consent of the Company and
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
Company. Any such determination permitting the resignation of the Company
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 Company's responsibilities and obligations hereunder in
the
manner provided in Section 11.01.
Section
8.05 No
Transfer of Servicing.
With
respect to the retention of the Company to service the Mortgage Loans hereunder,
the Company acknowledges that the Purchaser has acted in reliance upon
the
Company's independent status, the adequacy of its servicing facilities,
plan,
personnel, records and procedures, its integrity, reputation and financial
standing and the continuance thereof. Without in any way limiting the generality
of this Section, the Company shall not either assign this Agreement or
the
servicing hereunder or delegate its rights or duties hereunder or any portion
thereof, or sell or otherwise dispose of all or substantially all of its
property or assets, without the prior written approval of the Purchaser,
which
consent shall be granted or withheld in the Purchaser's sole
discretion.
Without
in any way limiting the generality of this Section 8.05, in the event that
the
Company either shall assign this Agreement or the servicing responsibilities
hereunder or delegate its duties hereunder or any portion thereof without
(i)
satisfying the requirements set forth herein or (ii) the prior written
consent
of the Purchaser, then the Purchaser shall have the right to terminate
this
Agreement, without any payment of any penalty or damages and without any
liability whatsoever to the Company (other than with respect to accrued
but
unpaid Servicing Fees and Servicing Advances remaining unpaid) or any third
party.
ARTICLE
IX
DEFAULT
Section
9.01 Events
of Default.
In
case
one or more of the following Events of Default by the Company shall occur
and be
continuing, that is to say:
(i)
any
failure by the Company to remit to the Purchaser any payment required to
be made
under the terms of this Agreement which continues unremedied for a period
of one
(1) Business Day; or
(ii)
failure on the part of the Company duly to observe or perform in any material
respect any other of the covenants or agreements on the part of the Company
set
forth in this Agreement which continues unremedied for a period of thirty
(30)
days after the date on which written notice of such failure, requiring
the same
to be remedied, shall have been given to the Company by the Purchaser;
or
(iii)
a
decree or order of a court or agency or supervisory authority having
jurisdiction for the appointment of a conservator or receiver or liquidator
in
any insolvency, bankruptcy, readjustment of debt, marshalling of assets
and
liabilities or similar proceedings, or for the winding-up or liquidation
of its
affairs, shall have been entered against the Company and such decree or
order
shall have remained in force undischarged or unstayed for a period of sixty
days; or
(iv)
the
Company shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshalling
of
assets and liabilities or similar proceedings of or relating to the Company
or
of or relating to all or substantially all of its property; or
(v)
the
Company shall admit in writing its inability to pay its debts generally
as they
become due, file a petition to take advantage of any applicable insolvency
or
reorganization statute, make an assignment for the benefit of its creditors,
or
voluntarily suspend payment of its obligations; or
(vi)
Company ceases to be approved by either Xxxxxx Xxx or FHLMC as a mortgage
loan
seller or servicer for more than thirty days; or
(vii)
the
Company attempts to assign its right to servicing compensation hereunder
or the
Company 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
(viii)
the Company ceases to be (a) licensed to service first lien residential
mortgage
loans in any jurisdiction in which a Mortgaged Property is located and
such
licensing is required, and (b) qualified to transact business in any
jurisdiction where it is currently so qualified, but only to the extent
such
non-qualification materially and adversely affects the Company's ability
to
perform its obligations hereunder; or
(ix)
the
Company fails to meet the eligibility criteria set forth in the last sentence
of
Section 8.02.
Then,
and
in each and every such case, so long as an Event of Default shall not have
been
remedied, the Purchaser, by notice in writing to the Company (except in
the case
of an Event of Default under clauses (iii), (iv) or (v) above, in which
case,
automatically and without notice) Company may, in addition to whatever
rights
the Purchaser may have under Sections 3.03 and 8.01 and at law or equity
or to
damages, including injunctive relief and specific performance, terminate
all the
rights and obligations of the Company under this Agreement and in and to
the
Mortgage Loans and the proceeds thereof without compensating the Company
for the
same. On or after the receipt by the Company of such written notice (or,
in the
case of an Event of Default under clauses (iii), (iv) or (v) above, in
which
case, automatically and without notice), all authority and power of the
Company
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
11.01. Upon written request from the Purchaser, the Company 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 Company's
sole
expense. The Company agrees to cooperate with the Purchaser and such successor
in effecting the termination of the Company'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 Company to the Custodial Account or Escrow Account or thereafter received
with respect to the Mortgage Loans or any REO Property.
Section
9.02 Waiver
of Defaults.
The
Purchaser may waive only by written notice any default by the Company 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 in writing.
ARTICLE
X
TERMINATION
Section
10.01 Termination.
The
respective obligations and responsibilities of the Company shall terminate
upon:
(i) the later of the final payment or other liquidation (or any advance
with
respect thereto) of the last Mortgage Loan and the disposition of all remaining
REO Property and the remittance of all funds due hereunder; or (ii) by
mutual
consent of the Company and the Purchaser in writing; or (iii) termination
with
cause under the terms of this Agreement.
ARTICLE
XI
MISCELLANEOUS
PROVISIONS
Section
11.01 Successor
to the Company.
Prior
to
termination of Company's responsibilities and duties under this Agreement
pursuant to Sections 4.13, 8.04, 9.01, 10.01 (ii) or (iii), the Purchaser
shall
(i) succeed to and assume all of the Company's responsibilities, rights,
duties
and obligations under this Agreement, or (ii) appoint a successor having
the
characteristics set forth in Section 8.02 hereof and which shall succeed
to all
rights and assume all of the responsibilities, duties and liabilities of
the
Company under this Agreement prior to the termination of Company's
responsibilities, duties and liabilities under this Agreement. In connection
with such appointment and assumption, the Purchaser may make such arrangements
for the compensation of such successor out of payments on Mortgage Loans
as the
Purchaser and such successor shall agree. In the event that the Company's
duties, responsibilities and liabilities under this Agreement should be
terminated pursuant to the aforementioned Sections, the Company shall discharge
such duties and responsibilities during the period from the date it acquires
knowledge of such termination until the effective date thereof with the
same
degree of diligence and prudence which it is obligated to exercise under
this
Agreement, and shall take no action whatsoever that might impair or prejudice
the rights or financial condition of its successor. The resignation or
removal
of Company pursuant to the aforementioned Sections shall not become effective
until a successor shall be appointed pursuant to this Section and shall
in no
event relieve the Company of the representations and warranties made pursuant
to
Sections 3.01, 3.02 and 3.03 and the remedies available to the Purchaser
thereunder and under Section 8.01, it being understood and agreed that
the
provisions of such Sections 3.01, 3.02, 3.03 and 8.01 shall be applicable
to the
Company notwithstanding any such resignation or termination of the Company,
or
the termination of this Agreement.
Any
successor appointed as provided herein shall execute, acknowledge and deliver
to
the Company and to the Purchaser an instrument accepting such appointment,
whereupon such successor shall become fully vested with all the rights,
powers,
duties, responsibilities, obligations and liabilities of the Company, with
like
effect as if originally named as a party to this Agreement. Any termination
or
resignation of the Company or this Agreement pursuant to Section 4.13,
8.04,
9.01 or 10.01 shall not affect any claims that the Purchaser may have against
the Company arising prior to any such termination or resignation.
The
Company shall promptly deliver to the successor the funds in the Custodial
Account and the Escrow Account and the Mortgage Files and related documents
and
statements held by it hereunder and the Company shall account for all funds.
The
Company shall execute and deliver such instruments and do such other things
all
as may reasonably be required to more fully and definitely vest and confirm
in
the successor all such rights, powers, duties, responsibilities, obligations
and
liabilities of the Company. The successor shall make arrangements as it
may deem
appropriate to reimburse the Company for unrecovered Servicing Advances
which
the successor retains hereunder and which would otherwise have been recovered
by
the Company pursuant to this Agreement but for the appointment of the successor
servicer.
Upon
a
successor's acceptance of appointment as such, the Company shall notify
by mail
the Purchaser of such appointment.
Section
11.02 Amendment.
This
Agreement may be amended from time to time by the Company and the Purchaser
by
written agreement signed by the Company and the Purchaser.
Section
11.03 Recordation
of Agreement.
To
the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all the counties
or
other comparable jurisdictions in which any of the properties subject to
the
Mortgages are situated, and in any other appropriate public recording office
or
elsewhere, such recordation to be effected by the Company at the Company's
expense on direction of the Purchaser accompanied by an opinion of counsel
to
the effect that such recordation materially and beneficially affects the
interest of the Purchaser or is necessary for the administration or servicing
of
the Mortgage Loans.
Section
11.04 Governing
Law.
This
Agreement and the related Term Sheet shall be governed by and construed
in
accordance with the laws of the State of New York except to the extent
preempted
by Federal law. The obligations, rights and remedies of the parties hereunder
shall be determined in accordance with such laws.
Section
11.05 Notices.
Any
demands, notices or other communications permitted or required hereunder
shall
be in writing and shall be deemed conclusively to have been given if personally
delivered at or mailed by registered mail, postage prepaid, and return
receipt
requested or certified mail, return receipt requested, or transmitted by
telex,
telegraph or telecopier and confirmed by a similar mailed writing, as
follows:
(i)
if
to the
Company:
First
Horizon Home Loan Corporation
0000
Xxxxxxx Xxx
Xxxxxx,
Xxxxx 00000
Attention:
Capital Markets Department
Telecopier
No.: [___________]
First
Tennessee Mortgage Services, Inc.
0000
Xxxxxxx Xxx
Xxxxxx,
Xxxxx 00000
Attention:
Capital Markets Department
Telecopier
No.: [___________]
(ii) if
to the
Purchaser:
EMC
Mortgage Corporation
Mac
Xxxxxx Xxxxx XX,
000
Xxxxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxx,
Xxxxx 00000
Attention:
Xx. Xxxxxx Xxxxx
Telecopier
No.: (000) 000-0000
With
a
copy to:
Bear
Xxxxxxx Mortgage Capital Corporation
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxx Xxxxxxxx
or
such
other address as may hereafter be furnished to the other party by like
notice.
Any such demand, notice or communication hereunder shall be deemed to have
been
received on the date delivered to or received at the premises of the addressee
(as evidenced, in the case of registered or certified mail, by the date
noted on
the return receipt).
Section
11.06 Severability
of Provisions.
Any
part,
provision, representation or warranty of this Agreement and the related
Term
Sheet which is prohibited or which is held to be void or unenforceable
shall be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any part, provision,
representation or warranty of this Agreement which is prohibited or
unenforceable or is held to be void or unenforceable in any jurisdiction
shall
be ineffective, as to such jurisdiction, to the extent of such prohibition
or
unenforceability without invalidating the remaining provisions hereof,
and any
such prohibition or unenforceability in any jurisdiction as to any Mortgage
Loan
shall not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the parties hereto
waive any provision of law that prohibits or renders void or unenforceable
any
provision hereof. If the invalidity of any part, provision, representation
or
warranty of this Agreement shall deprive any party of the economic benefit
intended to be conferred by this Agreement, the parties shall negotiate,
in good
faith, to develop a structure the economic effect of which is nearly as
possible
the same as the economic effect of this Agreement without regard to such
invalidity.
Section
11.07 Exhibits.
The
exhibits to this Agreement are hereby incorporated and made a part hereof
and
are an integral part of this Agreement.
Section
11.08 General
Interpretive Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
(i)
the
terms
defined in this Agreement have the meanings assigned to them in this Agreement
and include the plural as well as the singular, and the use of any gender
herein
shall be deemed to include the other gender;
(ii)
accounting
terms not otherwise defined herein have the meanings assigned to them in
accordance with generally accepted accounting principles;
(iii)
references
herein to "Articles", "Sections", Subsections", "Paragraphs", and other
subdivisions without reference to a document are to designated Articles,
Sections, Subsections, Paragraphs and other subdivisions of this
Agreement;
(iv)
a
reference to a Subsection without further reference to a Section is a reference
to such Subsection as contained in the same Section in which the reference
appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(v)
the
words
"herein", "hereof ", "hereunder" and other words of similar import refer
to this
Agreement as a whole and not to any particular provision;
(vi)
the
term
"include" or "including" shall mean without limitation by reason of enumeration;
and
(viii)
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
11.09 Reproduction
of Documents.
This
Agreement and all documents relating thereto, including, without limitation,
(i)
consents, waivers and modifications which may hereafter be executed, (ii)
documents received by any party at the closing, and (iii) financial statements,
certificates and other information previously or hereafter furnished, may
be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in
any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in
evidence.
Section
11.10 Confidentiality
of Information.
Each
party recognizes that, in connection with this Agreement, it may become
privy to
non-public information regarding the financial condition, operations and
prospects of the other party. Each party agrees to keep all non-public
information regarding the other party strictly confidential, and to use
all such
information solely in order to effectuate the purpose of the Agreement,
provided
that each party may provide confidential information to its employees,
agents
and affiliates who have a need to know such information in order to effectuate
the transaction, provided further that such information is identified as
confidential non-public information. In addition, confidential information
may
be provided to a regulatory authority with supervisory power over Purchaser,
provided such information is identified as confidential non-public
information.
Notwithstanding
other provisions of this Section 16.14 or any other express or implied
agreement, arrangement, or understanding to the contrary, the Company and
Purchaser (the “Parties”) agree that the Parties (and their employees,
representatives and other agents) may disclose to any and all persons,
without
limitation of any kind from the commencement of discussions, the purported
or
claimed U.S. federal income tax treatment of the purchase of the Mortgage
Loans
and related transactions covered by this letter agreement (“tax treatment”) and
any fact that may be relevant to understanding the tax treatment (“tax
structure”) and all materials of any kind (including opinions or other tax
analyses) that are provided to the Parties relating to such tax treatment
and
tax structure, except where confidentiality is reasonably necessary to
comply
with securities laws.
Section
11.11 Recordation
of Assignments of Mortgage.
To
the
extent permitted by applicable law, each of the Assignments is subject
to
recordation in all appropriate public offices for real property records
in all
the counties or other comparable jurisdictions in which any or all of the
Mortgaged Properties are situated, and in any other appropriate public
recording
office or elsewhere, such recordation to be effected by and at the Company’s
expense in the event recordation is either necessary under applicable law
or
requested by the Purchaser at its sole option.
Section
11.12 Assignment.
The
Purchaser shall have the right, without the consent of the Company, 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
substantially in the form of Exhibit D hereto and the assignee or designee
shall
accede to the rights and obligations hereunder of the Purchaser with respect
to
such Mortgage Loans. In no event shall Purchaser sell a partial interest
in any
Mortgage Loan without the written consent of Company, which consent shall
not be
unreasonably denied. All references to the Purchaser in this Agreement
shall be
deemed to include its assignee or designee. The Company shall have the
right,
only with the consent of the Purchaser or otherwise in accordance with
this
Agreement, to assign, in whole or in part, its interest under this Agreement
with respect to some or all of the Mortgage Loans.
Section
11.13 No
Partnership.
Nothing
herein contained shall be deemed or construed to create a co-partnership
or
joint venture between the parties hereto and the services of the Company
shall
be rendered as an independent contractor and not as agent for
Purchaser.
Section
11.14 Execution:
Successors and Assigns.
This
Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed,
shall
be deemed to be an original; such counterparts, together, shall constitute
one
and the same agreement. Subject to this Agreement shall inure to the benefit
of
and be binding upon the Company and the Purchaser and their respective
successors and assigns.
Section
11.15 Entire
Agreement.
The
Company acknowledges that no representations, agreements or promises were
made
to the Company by the Purchaser or any of its employees other than those
representations, agreements or promises specifically contained herein and
in the
Confirmation. The Confirmation and this Agreement and the related Term
Sheet
sets forth the entire understanding between the parties hereto; provided,
however, only this Agreement and the related Term Sheet shall be binding
upon
all successors of both parties. In the event of any inconsistency between
the
Confirmation and this Agreement, this Agreement and the related Term Sheet
shall
control.
Section
11.16. No
Solicitation.
From
and
after the Closing Date, the Company agrees that it will not take any action
or
permit or cause any action to be taken by any of its agents or affiliates,
to
personally, by telephone or mail, solicit the borrower or obligor under
any
Mortgage Loan to refinance the Mortgage Loan, in whole or in part, without
the
prior written consent of the Purchaser. Notwithstanding the foregoing,
it is
understood and agreed that (i) promotions undertaken by the Company or
any
affiliate of the Company which are directed to the general public at large,
or
segments thereof, provided that no segment shall consist primarily of the
Mortgage Loans, including, without limitation, mass mailing based on
commercially acquired mailing lists, newspaper, radio and television
advertisements and (ii) responses to unsolicited requests or inquiries
made by a
Mortgagor or an agent of a Mortgagor, shall not constitute solicitation
under
this Section 11.16. This Section 11.16 shall not be deemed to preclude
the
Company or any of its affiliates from soliciting any Mortgagor for any
other
financial products or services. The Company shall use its best efforts
to
prevent the sale of the name of any Mortgagor to any Person who is not
affiliate
of the Company.
Section
11.17. Closing.
The
closing for the purchase and sale of the Mortgage Loans shall take place
on the
related Closing Date. The closing shall be either: by telephone, confirmed
by
letter or wire as the parties shall agree, or conducted in person, at such
place
as the parties shall agree.
The
closing for the Mortgage Loans to be purchased on the related Closing Date
shall
be subject to each of the following conditions:
(a) at
least
one (1) Business Day prior to the related Closing Date, the Company shall
deliver to the Purchaser a magnetic diskette, or transmit by modem, a listing
on
a loan-level basis of the information contained in the related Mortgage
Loan
Schedule attached to the related Term Sheet;
(b) all
of
the representations and warranties of the Company under this Agreement
shall be
materially true and correct as of the related Closing Date and no event
shall
have occurred which, with notice or the passage of time, would constitute
a
material default under this Agreement;
(c) the
Purchaser shall have received, or the Purchaser's attorneys shall have
received
in escrow, all documents required pursuant to this Agreement, the related
Term
Sheet, an opinion of counsel and an officer's certificate, all in such
forms as
are agreed upon and acceptable to the Purchaser, duly executed by all
signatories other than the Purchaser as required pursuant to the terms
hereof;
(d) the
Company shall have delivered and released to the Purchaser (or its designee)
on
or prior to the related Closing Date all documents required pursuant to
the
terms of this Agreement and the related Term Sheet; and
(e) all
other
terms and conditions of this Agreement, the related Term Sheet and the
Confirmation shall have been materially complied with.
Subject
to the foregoing conditions, the Purchaser shall pay to the Company on
the
related Closing Date the Purchase Price, plus accrued interest pursuant
to
Section 2.02 of this Agreement, by wire transfer of immediately available
funds
to the account designated by the Company.
Section
11.18. Cooperation
of Company with a Reconstitution.
The
Company and the Purchaser agree that with respect to some or all of the
Mortgage
Loans, on or after the related Closing Date, on one or more dates (each
a
"Reconstitution Date") at the Purchaser's sole option and with Purchaser’s best
efforts to provide notice to the Company fifteen (15) days prior to the
Reconstitution Date, the Purchaser may effect one or more sales, but in
no event
greater than three (3) per pool of Mortgage Loan sold under the related
Term
Sheet (each, a "Reconstitution") of some or all of the Mortgage Loans then
subject to this Agreement, without recourse, to:
(a)
one or
more third party purchasers in one or more in whole loan transfers (each,
a
"Whole Loan Transfer"); or
(b) one
or
more trusts or other entities to be formed as part of one or more pass-through
transfers (each, a "Pass-Through Transfer").
The
Company agrees to execute in connection with any agreements among the Purchaser,
the Company, and any servicer in connection with a Whole Loan Transfer,
an
Assignment, Assumption and Recognition Agreement substantially in the form
of
Exhibit D hereto, or, at Purchaser’s request, a seller's warranties and
servicing agreement or a participation and servicing agreement or similar
agreement in form and substance reasonably acceptable to the parties, and
in
connection with a Pass-Through Transfer, a pooling and servicing agreement
in
form and substance reasonably acceptable to the parties, (collectively
the
agreements referred to herein are designated, the "Reconstitution Agreements").
It is understood that any such Reconstitution Agreements will not contain
any
greater obligations on the part of Company than are contained in this
Agreement.
With
respect to each Whole Loan Transfer and each Pass-Through Transfer entered
into
by the Purchaser, the Company 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 (each, a "Reconstitution Date"). In
that
connection, the Company shall provide to such servicer or issuer, as the
case
may be, and any other participants in such Reconstitution: (i) any and
all
information (including servicing portfolio information) and appropriate
verification of information (including servicing portfolio information)
which
may be reasonably available to the Company, whether through letters of
its
auditors and counsel or otherwise, as the Purchaser or any such other
participant shall request upon reasonable demand; and (ii) such additional
representations, warranties, covenants, opinions of counsel, letters from
auditors, and certificates of public officials or officers of the Company
as are
reasonably agreed upon by the Company and the Purchaser or any such other
participant. In connection with each Pass-Through Transfer, the Company
agrees
to provide reasonable and customary indemnification to the Purchaser and
its
affilates for disclosure contained in any offering document relating to
the
Company or its affilates, the Mortgage Loans and the underwriting standards
of
the Mortgage Loans. The Purchaser shall be responsible for the costs relating
to
the delivery of such information.
The
Purchaser agrees that in no event shall the related Servicing Fee Rate
be
reduced for any Mortgage Loan that is subject to a Reconstitution without
the
written consent of the Servicer.
All
Mortgage Loans not sold or transferred pursuant to a Reconstitution shall
remain
subject to, and serviced in accordance with the terms of, this Agreement and
the
related Term Sheet, and with respect thereto this Agreement and the related
Term
Sheet shall remain in full force and effect.
Section
11.19. Reporting
with Respect to a Reconstitution.
The
Company agrees that with respect to any Mortgage Loan sold or transferred
pursuant to a Reconstitution as described in Section 11.18 of this Agreement
(a
“Reconstituted Mortgage Loan”), the Company, at its expense, shall provide the
Purchaser with the information set forth in Exhibit J attached hereto for
each
Reconstituted Mortgage Loan in such electronic format as may be mutually
agreed
upon by both Purchaser and Company.
Section
11.20 Obligations
of the Sellers
The
obligations, liability and indemnification of each of the Seller and the
Servicer under this Agreement are joint and several.
IN
WITNESS WHEREOF, the Company and the Purchaser have caused their names
to be
signed hereto by their respective officers thereunto duly authorized as
of the
day and year first above written.
EMC
MORTGAGE CORPORATION
Purchaser
By:________________________
Name:
Title:
FIRST
HORIZON HOME LOAN
CORPORATION
Seller
By:
_______________________
Name:
Title:
FIRST
TENNESSEE MORTGAGE
SERVICES,
INC.
Servicer
By:
_______________________
Name:
Title:
EXHIBIT
A
CONTENTS
OF MORTGAGE FILE
With
respect to each Mortgage Loan, the Mortgage File shall include each of
the
following items, which shall be available for inspection by the Purchaser,
and
which shall be retained by the Company in the Servicing File or delivered
to the
Purchaser or its designee pursuant to Sections 2.04 and 2.05 of the Purchase,
Warranties and Servicing Agreement.
1.
The
original Mortgage Note endorsed "Pay to the order of
____________________________________________________, without recourse,"
and
signed via original signature in the name of the Company by an authorized
officer, with all intervening endorsements showing a complete chain of
title
from the originator to the Company, together with any applicable riders.
In no
event may an endorsement be a facsimile endorsement. If the Mortgage Loan
was
acquired by the Company in a merger, the endorsement must be by "[Company],
successor by merger to the [name of predecessor]". If the Mortgage Loan
was
acquired or originated by the Company while doing business under another
name,
the endorsement must be by "[Company] formerly known as [previous name]".
Mortgage Notes may be in the form of a lost note affidavit subject to Purchaser
acceptability.
2.
The
original Mortgage (together with a standard adjustable rate mortgage rider)
with
evidence of recording thereon, or a copy thereof certified by the public
recording office in which such mortgage has been recorded or, if the original
Mortgage has not been returned from the applicable public recording office,
a
true certified copy, certified by the Company.
3.
The
original or certified copy, certified by the Company, of the Primary Mortgage
Insurance Policy, if required.
4. The
original Assignment, from the Company to _____________________________________,
or in accordance with Purchaser's instructions, which assignment shall,
but for
any blanks requested by Purchaser, be in form and substance acceptable
for
recording. If the Mortgage Loan was acquired or originated by the Company
while
doing business under another name, the Assignment must be by "[Company]
formerly
known as [previous name]". If the Mortgage Loan was acquired by the Company
in a
merger, the endorsement must be by "[Company], successor by merger to the
[name
of predecessor]". None of the Assignments are blanket assignments of
mortgage.
5. The
original policy of title insurance, including riders and endorsements thereto,
or if the policy has not yet been issued, a written commitment or interim
binder
or preliminary report of title issued by the title insurance or escrow
company.
6. Originals
of all recorded intervening Assignments, or copies thereof, certified by
the
public recording office in which such Assignments have been recorded showing
a
complete chain of title from the originator to the Company, with evidence
of
recording thereon, or a copy thereof certified by the public recording
office in
which such Assignment has been recorded or, if the original Assignment
has not
been returned from the applicable public recording office, a true certified
copy, certified by the Company.
7. Originals,
or copies thereof certified by the public recording office in which such
documents have been recorded, of each assumption, extension, modification,
written assurance or substitution agreements, if applicable, or if the
original
of such document has not been returned from the applicable public recording
office, a true certified copy, certified by the Company.
8. If
the
Mortgage Note or Mortgage or any other material document or instrument
relating
to the Mortgage Loan has been signed by a person on behalf of the Mortgagor,
the
original or copy of power of attorney or other instrument that authorized
and
empowered such person to sign bearing evidence that such instrument has
been
recorded, if so required in the appropriate jurisdiction where the Mortgaged
Property is located, or a copy thereof certified by the public recording
office
in which such instrument has been recorded or, if the original instrument
has
not been returned from the applicable public recording office, a true certified
copy, certified by the Company.
9. reserved.
10. Mortgage
Loan closing statement (Form HUD-1) and any other truth-in-lending or real
estate settlement procedure forms required by law.
11.
Residential loan application.
12. Uniform
underwriter and transmittal summary (Xxxxxx Xxx Form 1008) or reasonable
equivalent.
13. Credit
report on the mortgagor.
14. Business
credit report, if applicable.
15. Residential
appraisal report and attachments thereto.
16. The
original of any guarantee executed in connection with the Mortgage
Note.
17. Verification
of employment and income except for Mortgage Loans originated under a limited
documentation program, all in accordance with Company's underwriting
guidelines.
18. Verification
of acceptable evidence of source and amount of down payment, in accordance
with
Company's underwriting guidelines.
19. Photograph
of the Mortgaged Property (may be part of appraisal).
20. Survey
of
the Mortgaged Property, if any.
21. Sales
contract, if applicable.
22. If
available, termite report, structural engineer’s report, water portability and
septic certification.
23. Any
original security agreement, chattel mortgage or equivalent executed in
connection with the Mortgage.
24. Name
affidavit, if applicable.
Notwithstanding
anything to the contrary herein, Company may provide one certificate for
all of
the Mortgage Loans indicating that the documents were delivered for
recording.
EXHIBIT
B
CUSTODIAL
ACCOUNT LETTER AGREEMENT
______________,
2003
To: [_______________________]
(the
"Depository")
As
"Company" under the Purchase, Warranties and Servicing Agreement, dated
as of
[_____________________] 1, 200[_] (the "Agreement"), we hereby authorize
and
request you to establish an account, as a Custodial Account pursuant to
Section
4.04 of the Agreement, to be designated as
"[______________________________________], in trust for the [Purchaser],
Owner
of Adjustable Rate Mortgage Loans". All deposits in the account shall be
subject
to withdrawal therefrom by order signed by the Company. This letter is
submitted
to you in duplicate. Please execute and return one original to us.
| [__________________________] | |
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
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 up to applicable limits by the Federal Deposit Insurance Corporation
through the Bank Insurance Fund or the Savings Association Insurance Fund
or
will be invested in Permitted Investments as defined in the
Agreement.
| [__________________________] | |
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
EXHIBIT
C
ESCROW
ACCOUNT LETTER AGREEMENT
_____________,
2003
To: [_______________________]
(the
"Depository")
As
“Company” under the Purchase Warranties and Servicing Agreement, dated as of
[____________________]1, 200[_] (the "Agreement"), we hereby authorize
and
request you to establish an account, as an Escrow Account pursuant to Section
4.06 of the Agreement, to be designated as "[__________________________],
in
trust for the [Purchaser], Owner of Adjustable Rate Mortgage Loans, and
various
Mortgagors." All deposits in the account shall be subject to withdrawal
therefrom by order signed by the Company. This letter is submitted to you
in
duplicate. Please execute and return one original to us.
| [__________________________] | |
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
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 up to applicable limits by the Federal Deposit Insurance Corporation
through the Bank Insurance Fund or the Savings Association Insurance Fund
or
will be invested in Permitted Investments as defined in the
Agreement.
| [__________________________] | |
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
EXHIBIT
D
FORM
OF
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
This
is a
Purchase, Assignment, Assumption and Recognition Agreement (this “PAAR
Agreement”) made as of __________, 200__, among EMC Mortgage Corporation (the
“Assignor”), ___________________ (the “Assignee”), and _______________________
(the “Company”).
In
consideration of the mutual promises contained herein the parties hereto
agree
that the residential mortgage loans (the “Assigned Loans”) listed on Attachment
1 annexed hereto (the "Assigned Loan Schedule") now serviced by Company
for
Assignor and its successors and assigns pursuant to the Purchase, Warranties
and
Servicing Agreement, dated as of _________, 200__, between Assignor and
Company
(the “Purchase Agreement”) shall be subject to the terms of this PAAR Agreement.
Capitalized terms used herein but not defined shall have the meanings ascribed
to them in the Purchase Agreement.
Purchase,
Assignment and Assumption
1. Assignor
hereby grants, transfers and assigns to Assignee all of the right, title
and
interest of Assignor in the Assigned Loans and, as they relate to the Assigned
Loans, all of its right, title and interest in, to and under the Purchase
Agreement.
2. Simultaneously
with the execution hereof, (i) Assignee shall pay to Assignor the “Funding
Amount” as set forth in that certain letter agreement, dated as of _________
____, between Assignee and Assignor (the “Confirmation”) and (ii) Assignor, at
its expense, shall have caused to be delivered to Assignee or its designee
the
Mortgage File for each Assigned Loan in Assignor's or its custodian's
possession, as set forth in the Purchase Agreement, along with, for each
Assigned Loan, an endorsement of the Mortgage Note from the Company, in
blank,
and an assignment of mortgage in recordable form from the Company, in blank.
Assignee shall pay the Funding Amount by wire transfer of immediately available
funds to the account specified by Assignor. Assignee shall be entitled
to all
scheduled payments due on the Assigned Loans after ___________, 200__ and
all
unscheduled payments or other proceeds or other recoveries on the Assigned
Loans
received on and after _____________, 200__.
Representations,
Warranties and Covenants
3. Assignor
warrants and represents to Assignee and Company as of the date
hereof:
(a) Attached
hereto as Attachment 2 is a true and accurate copy of the Purchase Agreement,
which agreement is in full force and effect as of the date hereof and the
provisions of which have not been waived, amended or modified in any respect,
nor has any notice of termination been given thereunder;
(b) Assignor
is the lawful owner of the Assigned Loans with full right to transfer the
Assigned Loans and any and all of its interests, rights and obligations
under
the Purchase Agreement as they relate to the Assigned Loans, free and clear
from
any and all claims and encumbrances; and upon the transfer of the Assigned
Loans
to Assignee as contemplated herein, Assignee shall have good title to each
and
every Assigned Loan, as well as any and all of Assignee’s interests, rights and
obligations under the Purchase Agreement as they relate to the Assigned
Loans,
free and clear of any and all liens, claims and encumbrances;
(c) There
are
no offsets, counterclaims or other defenses available to Company with respect
to
the Assigned Loans or the Purchase Agreement;
(d) Assignor
has no knowledge of, and has not received notice of, any waivers under,
or any
modification of, any Assigned Loan;
(e) Assignor
is duly organized, validly existing and in good standing under the laws
of the
jurisdiction of its incorporation, and has all requisite power and authority
to
acquire, own and sell the Assigned Loans;
(f) Assignor
has full corporate power and authority to execute, deliver and perform
its
obligations under this PAAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this
PAAR
Agreement is in the ordinary course of Assignor’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignor’s charter or by-laws or any legal restriction, or any material
agreement or instrument to which Assignor is now a party or by which it
is
bound, or result in the violation of any law, rule, regulation, order,
judgment
or decree to which Assignor or its property is subject. The execution,
delivery
and performance by Assignor of this PAAR Agreement and the consummation
by it of
the transactions contemplated hereby, have been duly authorized by all
necessary
corporate action on part of Assignor. This PAAR Agreement has been duly
executed
and delivered by Assignor and, upon the due authorization, execution and
delivery by Assignee and Company, will constitute the valid and legally
binding
obligation of Assignor enforceable against Assignor in accordance with
its terms
except as enforceability may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws now or hereafter in effect
relating
to creditors’ rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(g) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignor in connection with the execution, delivery or performance by Assignor
of this PAAR Agreement, or the consummation by it of the transactions
contemplated hereby; and
(h) Neither
Assignor nor anyone acting on its behalf has offered, transferred, pledged,
sold
or otherwise disposed of the Assigned Loans or any interest in the Assigned
Loans, or solicited any offer to buy or accept a transfer, pledge or other
disposition of the Assigned Loans, or any interest in the Assigned Loans
or
otherwise approached or negotiated with respect to the Assigned Loans,
or any
interest in the Assigned Loans with any Person in any manner, or made any
general solicitation by means of general advertising or in any other manner,
or
taken any other action which would constitute a distribution of the Assigned
Loans under the Securities Act of 1933, as amended (the “1933 Act”) or which
would render the disposition of the Assigned Loans a violation of Section
5 of
the 1933 Act or require registration pursuant thereto.
4. Assignee
warrants and represents to, and covenants with, Assignor and Company as
of the
date hereof:
(a) Assignee
is duly organized, validly existing and in good standing under the laws
of the
jurisdiction of its organization and has all requisite power and authority
to
acquire, own and purchase the Assigned Loans;
(b) Assignee
has full corporate power and authority to execute, deliver and perform
its
obligations under this PAAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this
PAAR
Agreement is in the ordinary course of Assignee’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignee’s charter or by-laws or any legal restriction, or any material
agreement or instrument to which Assignee is now a party or by which it
is
bound, or result in the violation of any law, rule, regulation, order,
judgment
or decree to which Assignee or its property is subject. The execution,
delivery
and performance by Assignee of this PAAR Agreement and the consummation
by it of
the transactions contemplated hereby, have been duly authorized by all
necessary
corporate action on part of Assignee. This PAAR Agreement has been duly
executed
and delivered by Assignee and, upon the due authorization, execution and
delivery by Assignor and Company, will constitute the valid and legally
binding
obligation of Assignee enforceable against Assignee in accordance with
its terms
except as enforceability may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws now or hereafter in effect
relating
to creditors’ rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(c) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignee in connection with the execution, delivery or performance by Assignee
of this PAAR Agreement, or the consummation by it of the transactions
contemplated hereby; and
(d) Assignee
agrees to be bound as “Purchaser” by all of the terms, covenants and conditions
of the Purchase Agreement with respect to the Assigned Loans, and from
and after
the date hereof, Assignee assumes for the benefit of each of Assignor and
Company all of Assignor's obligations as “Purchaser” thereunder but solely with
respect to such Assigned Loans.
5. Company
warrants and represents to, and covenant with, Assignor and Assignee as
of the
date hereof:
(a)
Attached
hereto as Attachment 2 is a true and accurate copy of the Purchase Agreement,
which agreement is in full force and effect as of the date hereof and the
provisions of which have not been waived, amended or modified in any respect,
nor has any notice of termination been given thereunder;
(b)
Company
is duly organized, validly existing and in good standing under the laws
of the
jurisdiction of its incorporation, and has all requisite power and authority
to
service the Assigned Loans and otherwise to perform its obligations under
the
Purchase Agreement;
| (c) |
Company
has full corporate power and authority to execute, deliver and
perform its
obligations under this PAAR Agreement, and to consummate the
transactions
set forth herein. The consummation of the transactions contemplated
by
this PAAR Agreement is in the ordinary course of Company’s business and
will not conflict with, or result in a breach of, any of the
terms,
conditions or provisions of Company’s charter or by-laws or any legal
restriction, or any material agreement or instrument to which
Company is
now a party or by which it is bound, or result in the violation
of any
law, rule, regulation, order, judgment or decree to which Company
or its
property is subject. The execution, delivery and performance
by Company of
this PAAR Agreement and the consummation by it of the transactions
contemplated hereby, have been duly authorized by all necessary
corporate
action on part of Company. This PAAR Agreement has been duly
executed and
delivered by Company, and, upon the due authorization, execution
and
delivery by Assignor and Assignee, will constitute the valid
and legally
binding obligation of Company, enforceable against Company in
accordance
with its terms except as enforceability may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws
now or
hereafter in effect relating to creditors’ rights generally, and by
general principles of equity regardless of whether enforceability
is
considered in a proceeding in equity or at
law;
|
| (d) |
No
consent, approval, order or authorization of, or declaration,
filing or
registration with, any governmental entity is required to be
obtained or
made by Assignee in connection with the execution, delivery or
performance
by Company of this PAAR Agreement, or the consummation by it
of the
transactions contemplated hereby;
and
|
| (e) |
No
event has occurred
from the Closing Date to the date hereof which would render the
representations and warranties as to the related Assigned Loans
made by
the Company in Sections 3.01 and 3.02 of the Purchase Agreement
to be
untrue in any material respect.
|
| (f) |
Neither
this AAR Agreement nor any certification, statement, report or
other
agreement, document or instrument furnished or to be furnished
by the
Company pursuant to this AAR Agreement contains or will contain
any
materially untrue statement of fact or omits or will omit to
state a fact
necessary to make the statements contained therein not
misleading.
|
Recognition
of Assignee
6. From
and
after the date hereof, Company shall recognize Assignee as owner of the
Assigned
Loans and will service the Assigned Loans in accordance with the Purchase
Agreement. It is the intention of Assignor, Company and Assignee that this
PAAR
Agreement shall be binding upon and for the benefit of the respective successors
and assigns of the parties hereto. Neither Company nor Assignor shall amend
or
agree to amend, modify, waiver, or otherwise alter any of the terms or
provisions of the Purchase Agreement which amendment, modification, waiver
or
other alteration would in any way affect the Assigned Loans without the
prior
written consent of Assignee.
Miscellaneous
7. All
demands, notices and communications related to the Assigned Loans, the
Purchase
Agreement and this PAAR Agreement shall be in writing and shall be deemed
to
have been duly given if personally delivered at or mailed by registered
mail,
postage prepaid, as follows:
(a) In
the
case of Company,
____________________
____________________
____________________
____________________
____________________
With
a
copy to ______________________________________.
| (b) |
In
the case of Assignor,
|
____________________
____________________
____________________
____________________
____________________
(c)
In
the
case of Assignee,
EMC
Mortgage Corporation
Mac
Xxxxxx Xxxxx XX
000
Xxxxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxx,
Xxxxx 00000
Attention:
Xxxxxxx Xxxxx
Telecopier
No.: (000) 000-0000
with
a
copy to:
___________________
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
___________
Telecopier
No.: (212) 272-____
8. Each
party will pay any commissions it has incurred and the fees of its attorneys
in
connection with the negotiations for, documenting of and closing of the
transactions contemplated by this PAAR Agreement.
9. This
PAAR
Agreement shall be construed in accordance with the laws of the State of
New
York, without regard to conflicts of law principles, and the obligations,
rights
and remedies of the parties hereunder shall be determined in accordance
with
such laws.
10. No
term
or provision of this PAAR Agreement may be waived or modified unless such
waiver
or modification is in writing and signed by the party against whom such
waiver
or modification is sought to be enforced.
11. This
PAAR
Agreement shall inure to the benefit of the successors and assigns of the
parties hereto. Any entity into which Assignor, Assignee or Company may
be
merged or consolidated shall, without the requirement for any further writing,
be deemed Assignor, Assignee or Company, respectively, hereunder.
12. This
PAAR
Agreement shall survive the conveyance of the Assigned Loans, the assignment
of
the Purchase Agreement to the extent of the Assigned Loans by Assignor
to
Assignee and the termination of the Purchase Agreement.
13. This
PAAR
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.
14. In
the
event that any provision of this PAAR Agreement conflicts with any provision
of
the Purchase Agreement with respect to the Assigned Loans, the terms of
this
PAAR Agreement shall control. In the event that any provision of this PAAR
Agreement conflicts with any provision of the Confirmation with respect
to the
Assigned Loans, the terms of this PAAR Agreement shall control.
[Modification
of Purchase Agreement
15. The
Company and Assignor hereby amend the Purchase Agreement as
follows:
(a) The
following definitions are added to Section 1.01 of the Purchase
Agreement:
Securities
Administrator: ________________________
Supplemental
PMI Insurer: ________________________
Supplemental
PMI Policy: The
primary guarantee insurance policy of the Supplemental PMI Insurer attached
hereto as Exhibit J, or any successor Supplemental PMI Policy given to
the
Servicer by the Assignee.
Trustee:
________________________
(b) The
following definition is amended and restated:
Insurance
Proceeds: Proceeds
of any Primary Mortgage Insurance Policy, the Supplemental PMI Policy,
any title
policy, any hazard insurance policy or any other insurance policy covering
a
Mortgage Loan or other related Mortgaged Property, including any amounts
required to be deposited in the Custodial Account pursuant to Section 4.04,
to
the extent such proceeds are not to be applied to the restoration of the
related
Mortgaged Property or released to the Mortgagor in accordance with Accepted
Servicing Practices.
(c) The
following are added as the fourth, fifth and sixth paragraphs of Section
4.08:
“In
connection with its activities as servicer, the Company agrees to prepare
and
present, on behalf of itself and the Purchaser, claims to the Supplemental
PMI
Insurer with respect to the Supplemental PMI Policy and, in this regard,
to take
such action as shall be necessary to permit recovery under any Supplemental
PMI
Policy respecting a defaulted Mortgage Loan. Pursuant to Section 4.04,
any
amounts collected by the Company under any Supplemental PMI Policy shall
be
deposited in the Custodial Account, subject to withdrawal pursuant to Section
4.05.
In
accordance with the Supplemental PMI Policy, the Company shall provide
to the
Supplemental PMI Insurer any required information regarding the Mortgage
Loans.
The
Company shall provide to the [Securities Administrator] on a monthly basis
via
computer tape, or other mutually acceptable format, the unpaid principal
balance, insurer certificate number, lender loan number, and premium due
the
Supplemental PMI Insurer for each Mortgage Loan covered by the Supplemental
PMI
Policy. In addition, the Company agrees to forward to the Purchaser and
the
[Securities Administrator] any statements or other reports given by the
Supplemental PMI Insurer to the Servicer in connection with a claim under
the
Supplemental PMI Policy.”
(d) Clause
(vi) of Section 6.1 is amended to read as follows:
“Company
ceases to be approved by either Xxxxxx Xxx or FHLMC as a mortgage loan
seller or
servicer for more than thirty days, or the Company fails to meet the servicer
eligibility requirements of the Supplemental PMI Insurer; or”]
(e) Section
____ Annual
Statement as to Compliance.
The
Company will deliver to the Master Servicer on or before March 15 of each
year,
beginning with March 15, 200__, an Officers' Certificate stating that (i)
a
review of the activities of the Company during the preceding calendar year
and
of performance under this Agreement has been made under such officers'
supervision, (ii) the Company has fully complied with the provisions of
this
Agreement and (iii) to the best of such officers' knowledge, based on such
review, the Company has fulfilled all of its obligations under this Agreement
throughout such year, or, if there has been a default in the fulfillment
of any
such obligation, specifying each such default known to such officer and
the
nature and status thereof.
(f) Section
____ Annual Certification.
(a)
The
Company will deliver to the Master Servicer, on or before March 15 of each
year
beginning March 15, 200__ a certification in the form attached hereto as
Exhibit
__ with respect to the servicing reports delivered by the Company pursuant
to
this Agreement, the Company’s compliance with the servicing obligations set
forth in this Agreement and any other information within the control of
the
Company. Such certification shall be signed by the senior officer in charge
of
servicing of the Company. In addition, the Company shall provide such other
information with respect to the Mortgage Loans and the servicing and
administration thereof within the control of the Company which shall be
required
to enable the Master Servicer, Trustee or Depositor, as applicable, to
comply
with the reporting requirements of the Securities and Exchange Act of 1934,
as
amended.
IN
WITNESS WHEREOF, the parties hereto have executed this PAAR Agreement as
of the
day and year first above written.
EMC
MORTGAGE CORPORATION
Assignor
By:______________________________
Name:____________________________
Title:_________________________
_________________________________
Assignee
By:______________________________
Name:____________________________
Title:_________________________
_________________________________
Company
By:______________________________
Name:____________________________
Title:_________________________
EXHIBIT
___
FORM
OF
COMPANY CERTIFICATION
I,
[identify certifying individual], certify to the [Trustee] [Seller] [Securities
Administrator] [Mortgage Loan Seller] [Purchaser] and [Master Servicer]
that:
1. I
have
reviewed the servicing reports prepared by [COMPANY] (the “Company”) pursuant to
the [Servicing Agreement] (the “Servicing Agreement”), dated as of __________
between __________ and the Company (as modified by the AAR Agreement (as
defined
below) and delivered to [MASTER SERVICER] (the “Master Servicer”) pursuant to
the Assignment, Assumption and Recognition Agreement (the “AAR Agreement”),
dated as of __________ among [ASSIGNOR] as Assignor, Company and [ASSIGNEE],
as
Assignee.
2. Based
on
my knowledge, the information in these reports, taken as a whole, does
not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in light of the circumstances under
which
such statements were made, not misleading as of the last day of the period
covered by such servicing reports.
3. Based
on
my knowledge, the servicing information required to be provided to the
Master
Servicer under the Servicing Agreement and the AAR Agreement is included
in
these reports.
4. I
am
responsible for reviewing the activities performed the Company under the
Servicing Agreement and the AAR Agreement and based upon the review required
under the Servicing Agreement and the AAR Agreement, and except as disclosed
in
the Annual Statement of Compliance, the Company has fulfilled its obligations
under the Servicing Agreement and the AAR Agreement.
5. I
have
disclosed to the Master Servicer's certified public accountants all significant
deficiencies relating to the Company's compliance with the minimum servicing
standards in accordance with a review conduced in compliance with the Uniform
Single Attestation Program for Mortgage Bankers or similar standard as
set forth
in the Servicing Agreement and the AAR Agreement.
Capitalized
terms used but not defined herein have the meanings ascribed to them in
the AAR
Agreement.
Date:_________________
_____________________
[Signature]
[Title]
ATTACHMENT
1
ASSIGNED
LOAN SCHEDULE
ATTACHMENT
2
PURCHASE,
WARRANTIES AND SERVICING AGREEMENT
EXHIBIT
E
FORM
OF
TRIAL BALANCE
| · |
S50Y
- Scheduled/Scheduled Monthly Remittance
Report
|
| · |
P139
- Monthly Trial Balance Report
|
| · |
S214
- Monthly Pay-off Report
|
| · |
S215
- Monthly Actual Collections Report EXHIBIT
G
|
REQUEST
FOR RELEASE OF DOCUMENTS AND RECEIPT
RE: Mortgage
Loan #___________________________________________
BORROWER:_________________________________________________
PROPERTY:
__________________________________________________
Pursuant
to a Purchase, Warranties and Servicing Agreement (the "Agreement") between
the
Company and the Purchaser, the undersigned hereby certifies that he or
she is an
officer of the Company requesting release of the documents for the reason
specified below. The undersigned further certifies that:
(Check
one of the items below)
_____ On
_________________, the above captioned mortgage loan was paid in full or
that
the Company has been notified that payment in full has been or will be
escrowed.
The Company hereby certifies that all amounts with respect to this loan
which
are required under the Agreement have been or will be deposited in the
Custodial
Account as required.
_____ The
above
captioned loan is being repurchased pursuant to the terms of the Agreement.
The
Company hereby certifies that the repurchase price has been credited to
the
Custodial Account as required under the Agreement.
_____ The
above
captioned loan is being placed in foreclosure and the original documents
are
required to proceed with the foreclosure action. The Company hereby certifies
that the documents will be returned to the Purchaser in the event of
reinstatement.
_____ Other
(explain)
_______________________________________________________
_______________________________________________________
All
capitalized terms used herein and not defined shall have the meanings assigned
to them in the Agreement.
Based
on
this certification and the indemnities provided for in the Agreement, please
release to the Company all original mortgage documents in your possession
relating to this loan.
Dated:_________________
By:________________________________
Signature
___________________________________
Title
Send
documents to: _____________________________________________
_____________________________________________
_____________________________________________
Acknowledgement:
Purchaser
hereby acknowledges that all original documents previously released on
the above
captioned mortgage loan have been returned and received by the
Purchaser.
Dated:________________
By:________________________________
Signature
_______________________________
Title
EXHIBIT
H
COMPANY’S
UNDERWRITING GUIDELINES
EXHIBIT
I
TERM
SHEET
This
TERM
SHEET (the "Term Sheet") dated _____________, among First Horizon Home
Loan
Corporation, a Kansas corporation, located at 0000 Xxxxxxx Xxx, Xxxxxx,
Xxxxx
00000 (the “Seller”), First Tennessee Mortgage Services, Inc., as servicer (the
“Servicer”), a Kansas corporation, located at 0000 Xxxxxxx Xxx, Xxxxxx, Xxxxx
00000 (the Servicer and the Seller together referred to as the "Company")
and
EMC Mortgage Corporation, a Delaware corporation, located at Mac Xxxxxx
Xxxxx
XX, 000 Xxxxxx Xxxxx Xxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000 (the "Purchaser")
is
made pursuant to the terms and conditions of that certain Purchase, Warranties
and Servicing Agreement (the "Agreement") dated as of September 1, 2003,
among
the Servicer, the Seller and the Purchaser, the provisions of which are
incorporated herein as if set forth in full herein, as such terms and conditions
may be modified or supplemented hereby. All initially capitalized terms
used
herein unless otherwise defined shall have the meanings ascribed thereto
in the
Agreement.
The
Purchaser hereby purchases from the Seller and the Seller hereby sells
to the
Purchaser, all of the Seller’s right, title and interest in and to the Mortgage
Loans described on the Mortgage Loan Schedule annexed hereto as Schedule
I,
pursuant to and in accordance with the terms and conditions set forth in
the
Agreement, as same may be supplemented or modified hereby. Hereinafter,
the
Servicer shall service the Mortgage Loans for the benefit of the Purchaser
and
all subsequent transferees of the Mortgage Loans pursuant to and in accordance
with the terms and conditions set forth in the Agreement.
1. Definitions
For
purposes of the Mortgage Loans to be sold pursuant to this Term Sheet,
the
following terms shall have the following meanings:
Aggregate
Principal Balance
(as
of
the Cut-Off Date):
Closing
Date:
Custodian:
Cut-off
Date:
Initial
Weighted Average
Mortgage
Loan Remittance Rate:
Mortgage
Loan:
Purchase
Price Percentage:
Servicing
Fee Rate:
Additional
Closing Conditions:
In
addition to the conditions specified in the Agreement, the obligation of
each of
the Company and the Purchaser is subject to the fulfillment, on or prior
to the
applicable Closing Date, of the following additional conditions: [None].
Additional
Loan Documents:
In
addition to the contents of the Mortgage File specified in the Agreement,
the
following documents shall be delivered with respect to the Mortgage Loans:
[None]
[Additional]
[Modification] of Representations and Warranties:
[In
addition to the representations and warranties set forth in the Agreement,
as of
the date hereof, the Company makes the following additional representations
and
warranties with respect to the Mortgage Loans: [None]. [Notwithstanding
anything
to the contrary set forth in the Agreement, with respect to each Mortgage
Loan
to be sold on the Closing Date, the representation and warranty set forth
in
Section ______ of the Agreement shall be modified to read as
follows:]
Except
as
modified herein, Section ______ of the Agreement shall remain in full force
and
effect as of the date hereof.
IN
WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto
by their respective duly authorized officers as of the date first above
written.
FIRST
HORIZON HOME
LOAN CORPORATION
By:______________________________
Name:____________________________
Title:_________________________
EMC
MORTGAGE
CORPORATION
By:______________________________
Name:____________________________
Title:_________________________
FIRST
TENNESSEE
MORTGAGE SERVICES, INC.
By:______________________________
Name:____________________________
Title:_________________________
SCHEDULE
I
MORTGAGE
LOAN SCHEDULE
EXHIBIT
J
RECONSTITUTED
MORTGAGE LOAN REPORTING
(a) Servicer
Mortgage Loan Number
(b) FNMA
Mortgage Loan Number (if applicable)
(c) Lender/Seller
Mortgage Loan Number (if
available)
(d) Scheduled
Balance (scheduled end of month balance reporting to Master
Servicer/Trustee)
(e) Actual
Balance (actual end of month balance received from Mortgagor)
(f) Gross
Rate (current gross rate)
(g) Net
Rate
(current passthrough)
(h) Last
Payment Date (LPI_DATE in Fannie's Laser Reporting)
(i)
Delinquency
Month (if available)
(j) Default
Flag, i.e. FC, REO, etc. (if available)
(k) Pay-In-Full
Date (Mortgage Loan paid off by Mortgagor)
(l) Foreclosure
start date
(m) Foreclosure
end date
(n) REO
Property date
(o) With
respect to Liquidated Mortgage Loans:
(i)
amount of loss or gain (as applicable)
(ii)
the
date of the loss or gain.
(iii)
the
liquidation reason (paid in full or repurchased out of deal)
(p) Fannie's
Laser Reporting
(i) Action
Code (for default or paid off Mortgage Loans; i.e. 60, 65, etc.)
(ii) Action Date
(iii)
Remit Prin (submitted principal amount)
(iv)
Remit Int (submitted interest amount)
(v)
Pool/Invest indicator (indicating Schedule/Schedule or Actual/Actual
pool)
AMENDMENT
NO. 1 TO PURCHASE, WARRANTIES
AND
SERVICING AGREEMENT
THIS
AMENDMENT NO. 1, effective as of May 14, 2004, amends the Purchase, Warranties
and Servicing Agreement among EMC Mortgage Corporation (the “Purchaser”), First
Tennessee Mortgage Services, Inc., as servicer (the “Servicer”) and First
Horizon Home Loan Corporation (the “Seller”, and together with the Servicer, the
“Company”), previously entered into as of September 1, 2003 (the “Agreement”).
RECITALS
WHEREAS,
the Company sells to the Purchaser, and the Purchaser purchases from the
Company, from time to time, pursuant to the Agreement, certain conventional
residential Mortgage Loans on a servicing retained basis; and
WHEREAS,
in connection with future sales of Mortgage Loans to the Purchaser, the
Company
and the Purchaser wish to amend the Agreement as set forth below.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants hereinafter
set forth and for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Purchaser and the Company agree to
amend
the Agreement as follows:
1. Section
3.02(h) of the Agreement shall be deleted in its entirety and replaced
with the
following:
(h) Each
Mortgage Loan complies with, and the Company has complied with, applicable
local, state and federal laws, regulations and other requirements including,
without limitation, usury, equal credit opportunity, real estate settlement
procedures, the Federal Truth-In-Lending Act, disclosure laws and all applicable
predatory and abusive lending laws and consummation of the transactions
contemplated hereby, including without limitation, the receipt of interest
by
the owner of such Mortgage Loan, will not involve the violation of any
such
laws, rules or regulations. None
of
the Mortgage Loans are (a) Mortgage Loans subject to 12 CFR Part 226.31,
12 CFR
Part 226.32 or 226.34 of Regulation Z, the regulation implementing TILA,
which
implements the Home Ownership and Equity Protection Act of 1994, as amended,
or
(b) except as may be provided in subparagraph (c) below, classified and/or
defined, as a “high cost”, “threshold”, “predatory” “high risk home loan” or
“covered” loan (or a similarly classified loan using different terminology under
a law imposing additional legal liability for mortgage loans having high
interest rates, points and or/fees) under any other applicable state, federal
or
local law including, but not limited to, the States of Georgia, New York,
North
Carolina, Arkansas, Kentucky or New Mexico or (c) Mortgage Loans subject
to the
New Jersey Home Ownership Security Act of 2002 (the “Act”), unless such Mortgage
Loan is a (1) “Home Loan” as defined in the Act that is a first lien Mortgage
Loan, which is not a “High Cost Home Loan” as defined in the Act or (2) “Covered
Home Loan” as defined in the Act that is a first lien purchase money Mortgage
Loan, which is not a High Cost Home Loan under the Act. In addition to
and
notwithstanding anything to the contrary herein, no Mortgage Loan for which
the
Mortgaged Property is located in New Jersey is a Home Loan as defined in
the Act
that was made, arranged, or assigned by a person selling either a manufactured
home or home improvements to the Mortgaged Property or was made by an originator
to whom the Mortgagor was referred by any such seller. Each
Mortgage Loan is being (and has been) serviced in accordance with Accepted
Servicing Practices and applicable state and federal laws, including, without
limitation, the Federal Truth-In-Lending Act and other consumer protection
laws,
real estate settlement procedures, usury, equal credit opportunity and
disclosure laws. Company shall maintain in its possession, available for
the
Purchaser’s inspection, as appropriate, and shall deliver to the Purchaser or
its designee upon demand, evidence of compliance with all such
requirements.
2. The
following representations and warranties shall be added to Section 3.02
of the
Agreement:
(yy)
There
is
no Mortgage Loan that was originated on or after October 1, 2002 and before
March 7, 2003, which is secured by property located in the State of
Georgia.
(zz)
No
proceeds from any Mortgage Loan were used to finance single premium credit
insurance policies.
(aaa)
No
borrower was encouraged or required to select a Mortgage Loan product offered
by
the Mortgage Loan’s originator which is a higher cost product designed for less
creditworthy borrowers, unless at the time of the Mortgage Loan’s origination,
such borrower did not qualify taking into account credit history and
debt-to-income ratios for a lower-cost credit product then offered by the
Mortgage Loan’s originator or any affiliate of the Mortgage Loan’s originator.
If, at the time of loan application, the borrower may have qualified for
a
lower-cost credit product then offered by any mortgage lending affiliate
of the
Mortgage Loan’s originator, the Mortgage Loan’s originator referred the
borrower’s application to such affiliate for underwriting
consideration.
(bbb) The
methodology used in underwriting the extension of credit for each Mortgage
Loan
employs objective mathematical principles which relate the borrower’s income,
assets and liabilities to the proposed payment and such underwriting methodology
does not rely on the extent of the borrower’s equity in the collateral as the
principal determining factor in approving such credit extension. Such
underwriting methodology confirmed that at the time of origination
(application/approval) the borrower had a reasonable ability to make timely
payments on the Mortgage Loan.
(ccc) With
respect to any Mortgage Loan that contains a provision permitting imposition
of
a premium upon a prepayment prior to maturity: (i) prior to the loan’s
origination, the borrower agreed to such premium in exchange for a monetary
benefit, including but not limited to a rate or fee reduction, (ii) prior
to the
loan’s origination, the borrower was offered the option of obtaining a mortgage
loan that did not require payment of such a premium, (iii) the prepayment
premium is disclosed to the borrower in the loan documents pursuant to
applicable state and federal law, and (iv) notwithstanding any state or
federal
law to the contrary, the Servicer shall not impose such prepayment premium
in
any instance when the mortgage debt is accelerated as the result of the
borrower’s default in making the loan payments.
(ddd) No
borrower was required to purchase any credit life, disability, accident
or
health insurance product as a condition of obtaining the extension of credit.
No
borrower obtained a prepaid single-premium credit life, disability, accident
or
health insurance policy in connection with the origination of the Mortgage
Loan;
No proceeds from any Mortgage Loan were used to purchase single premium
credit
insurance policies as part of the origination of, or as a condition to
closing,
such Mortgage Loan.
(eee) The
Servicer will transmit full-file credit reporting data for each Mortgage
Loan
pursuant to the Xxxxxx Xxx Selling Guide and that for each Mortgage Loan,
Servicer agrees it shall report one of the following statuses each month
as
follows: new origination, current, delinquent (30-, 60-, 90-days, etc.),
foreclosed, or charged-off.
(fff) Any
Mortgage Loan with a Mortgaged Property in the State of Illinois complies
with
the Illinois Interest Act.
3. The
following field shall be added to the definition of Mortgage
Loan Schedule:
“and
(28)
whether such Mortgage Loan is a “Home Loan”, “Covered Home Loan”, “Manufactured
Housing” or “Home Improvement Loan” as defined in the
New
Jersey Home Ownership Security Act of 2002.”
4. Section
6.04 of the Agreement shall be deleted in its entirety and replaced with
the
following:
Section
6.04 Annual
Statement as to Compliance.
The
Company will deliver to the Purchaser not later than March 15th
of each
year, beginning March 15, 2005, an
executed Officers' Certificate acceptable to the Purchaser stating, as
to each
signatory thereof, that (i) a review of the activities of the Company during
the
preceding calendar year and of performance under this Agreement has been
made
under such officers' supervision, and (ii) to the best of such officers'
knowledge, based on such review, the Company has fulfilled all of its
obligations under this Agreement throughout such year, or, if there has
been a
default in the fulfillment of any such obligation, specifying each such
default
known to such officers and the nature and status of cure provisions thereof.
Such Officers’ Certificate shall contain no restrictions or limitations on its
use. Copies of such statement shall be provided by the Company to the Purchaser
upon request.
If
the
Company does not timely comply with this Section 6.04, the Purchaser shall
give
prompt written notice to the Company. The Company shall have a period of
five
(5) Business Days after receipt of such notice to provide what is required
hereunder. Failure of the Company to timely comply thereafter shall be
deemed an
Event of Default, automatically, without notice and without any cure period,
and
Purchaser may, in addition to whatever rights the Purchaser may have under
Sections 3.03 and 8.01 and at law or equity or to damages, including injunctive
relief and specific performance, terminate all the rights and obligations
of the
Company under this Agreement and in and to the Mortgage Loans and the proceeds
thereof without compensating the Company for the same, as provided in Section
9.01. Such termination shall be considered with cause pursuant to Section
10.01
of this Agreement. This paragraph shall supercede any other provision in
this
Agreement or any other agreement to the contrary.
5. Section
6.05 of the Agreement shall be deleted in its entirety and replaced with
the
following:
Section
6.05 Annual
Independent Certified Public Accountants' Servicing Report.
The
Company, at its expense and not later than March 15th
of each
year, beginning March 15, 2005, 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 the Purchaser acceptable to the Purchaser
to the effect that such firm has examined certain documents and records
relating
to the Company's servicing of mortgage loans of the same type as the Mortgage
Loans pursuant to servicing agreements substantially similar to this Agreement,
which agreements may include this Agreement, and that, on the basis of
such an
examination, conducted substantially in the uniform single audit program
for
mortgage bankers, such firm is of the opinion that the Company's servicing
has
been conducted in compliance with the agreements examined pursuant to this
Section 6.05, except for (i) such exceptions as such firm shall believe
to be
immaterial, and (ii) such other exceptions as shall be set forth in such
statement. Such statement shall contain no restrictions or limitations
on its
use. Copies of such statement shall be provided by the Company to the Purchaser.
In addition, on an annual basis, Company shall provide Purchaser with copies
of
its audited financial statements.
If
the
Company does not timely comply with this Section 6.05, the Purchaser shall
give
prompt written notice to the Company. The Company shall have a period of
five
(5) Business Days after receipt of such notice to provide what is required
hereunder. Failure of the Company to timely comply thereafter shall be
deemed an
Event of Default, automatically, without notice and without any cure period,
and
Purchaser may, in addition to whatever rights the Purchaser may have under
Sections 3.03 and 8.01 and at law or equity or to damages, including injunctive
relief and specific performance, terminate all the rights and obligations
of the
Company under this Agreement and in and to the Mortgage Loans and the proceeds
thereof without compensating the Company for the same, as provided in Section
9.01. Such termination shall be considered with cause pursuant to Section
10.01
of this Agreement. This paragraph shall supercede any other provision in
this
Agreement or any other agreement to the contrary.
6. All
other
terms and conditions of the Agreement remain unchanged and in full force
and
effect.
7. Capitalized
terms used but not defined herein shall have the meanings ascribed to them
in
the Agreement.
IN
WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to
be
executed and delivered by their proper and duly authorized officers as
of the
day and year first above written.
EMC
MORTGAGE CORPORATION
Purchaser
By:________________________
Name:
Title:
FIRST
HORIZON HOME LOAN
CORPORATION
Seller
By:
_______________________
Name:
Title:
FIRST
TENNESSEE MORTGAGE
SERVICES,
INC.
Servicer
By:
_______________________
Name:
Title:
AMENDMENT
NO. 2 TO PURCHASE, WARRANTIES
AND
SERVICING AGREEMENT
THIS
AMENDMENT NO. 2, effective as of June 16, 2005, amends the Purchase, Warranties
and Servicing Agreement among EMC Mortgage Corporation (the “Purchaser”), First
Tennessee Mortgage Services, Inc., as servicer (the “Servicer”) and First
Horizon Home Loan Corporation (the “Seller”, and together with the Servicer, the
“Company”), previously entered into as of September 1, 2003 (the “Agreement”),
as previously amended.
RECITALS
WHEREAS,
the Seller sells to the Purchaser, and the Purchaser purchases from the
Seller,
from time to time, pursuant to the Agreement, certain conventional residential
Mortgage Loans on a servicing retained basis serviced by the Servicer,
including
second lien loans; and
WHEREAS,
in connection with future sales of Mortgage Loans to the Purchaser, the
Company
and the Purchaser wish to amend the Agreement as set forth below.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants hereinafter
set forth and for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Purchaser and the Company agree to
amend
the Agreement as follows:
1.
The
preamble, in the second “Whereas” clause, shall be amended to include “or second
lien” following the term “first lien”.
2. The
definition of Mortgage shall be amended to include; “or second lien” following
the term “first lien”.
3. The
definition of “Determination Date” shall be deleted in its entirety and replaced
with the following:
“Determination
Date:
For
first lien Mortgage Loans only, 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. For second lien Mortgage Loans only, with
respect to each Remittance Date, the close of business of the last day
of the
month preceding the month in which such Remittance Date occurs.”
4. The
definition of “Monthly Advance” shall be amended to add; “For first lien
Mortgage Loans only,” at the beginning of the definition.
5. The
definition of “Remittance Date” shall be deleted in its entirety and replaced
with the following:
“Remittance
Date:
For
first lien Mortgage Loans only, the 18th day of any month, beginning with
the
First Remittance Date, or if such 18th day is not a Business Day, the first
Business Day immediately preceding such 18th day. For second lien Mortgage
Loans, the fifth (5th) day of each month, commencing on the fifth (5th)
day of
the month next following the month in which the Cut-off Date occurs, or
if such
fifth (5th) day is not a Business Day, the first Business Day immediately
following such fifth (5th) day.”
6. Section
3.02(b) shall be amended to include “or second lien, as applicable,” following
the term “first lien” and to include “or second priority ownership interest, as
applicable,” following the term “first priority ownership
interest”.
7. Section
3.02(j) shall be amended to include “or second lien, as applicable,” following
the term “first lien”. Further, Section 3.02(j) shall be amended to add “and (4)
for any second lien Mortgage Loan, the related first lien” at the end of the
second sentence.
8.
The
following representations and warranties shall be added to Section
3.02:
(ggg)
With respect to any Mortgage Loan originated on or after August 1, 2004
and
underlying the security, neither the related Mortgage nor the related Mortgage
Note requires the borrower to submit to arbitration to resolve any dispute
arising out of or relating in any way to the mortgage loan
transaction.
(hhh)
No
Mortgage Loan is secured by Mortgaged Property in the Commonwealth of
Massachusetts with a loan application date on or after November 7, 2004
that
refinances a mortgage loan that is less than sixty (60) months old, unless
such
Mortgage Loan (i) is on an investment property, (ii) meets the requirements
set
forth in the Code of Massachusetts Regulation (“CMR”), 209 CMR 53.04(1)(b), or
(iii) meets the requirements set forth in the 209 CMR 53.04(1)(c).
9.
Section
4.03 shall be amended to include the following:
“For
all
second lien Mortgage Loans only, the
Company shall use its best efforts, consistent with the procedures that
the
Company would use in servicing loans for its own account, consistent with
Accepted Servicing Practices, any Primary Mortgage Insurance Policies and
the
best interest of Purchaser, to foreclose upon or otherwise comparably convert
the ownership of properties securing such of the Mortgage Loans as come
into and
continue in default and as to which no satisfactory arrangements can be
made for
collection of delinquent payments. In addition, for all second lien Mortgage
Loans only, if the Company reasonably believes that Liquidation Proceeds
with
respect to any such Mortgage Loan would not be increased as a result of
such
foreclosure or other action, such Mortgage Loan will be charged-off or
will
become a liquidated Mortgage Loan. The Company will give notice of any
such
charge-off to the Purchaser. The decision of the Company to foreclose on
a
defaulted second lien Mortgage Loan shall be subject to a determination
by the
Company that the proceeds of such foreclosure would exceed the costs and
expenses of bringing such a proceeding.
Further,
for all second lien Mortgage Loans, the Company agrees that it shall provide
to
Purchaser within one hundred twenty (120) days of default for any such
second
lien Mortgage Loan a bid pass package to Purchaser containing all relevant
information and any necessary supporting documentation needed for Purchaser
to
determine whether to foreclose or charge-off such second lien Mortgage
Loan. For
any such second lien Mortgage Loan, Purchaser shall advise Company of its
decision to foreclose or charge-off by no later than one hundred eighty
(180)
days of default of such second lien Mortgage Loan. In addition, notwithstanding
anything contrary contained herein, Company will cease collection activity
on
any second lien Mortgage Loan that is twelve (12) months or more delinquent.”
10.
Section
4.03 shall be amended to include as the final paragraph:
“If
the
Mortgage relating to a Mortgage Loan had a lien senior to the Mortgage
Loan on
the related Mortgaged Property as of the Cut-off Date, then the Company,
in such
capacity, may consent to the refinancing of the prior senior lien, provided
that
the following requirements are met: (i) the resulting combined Loan-to-Value
Ratio of such Mortgage Loan is no higher than the combined Loan-to-Value
Ratio
prior to such refinancing; and (ii) the interest rate, or, in the case
of an
adjustable rate existing senior lien, the maximum interest rate, for the
loan
evidencing the refinanced senior lien is no more than 2.0% higher than
the
interest rate or the maximum interest rate, as the case may be, on the
loan
evidencing the existing senior lien immediately prior to the date of such
refinancing; and (iii) the loan evidencing the refinanced senior lien is
not
subject to negative amortization.”
11.
Section
5.01 shall be amended to add; “Notwithstanding anything to the contrary
contained herein, for all second lien Mortgage Loans only, Company shall,
within
five (5) business days of receipt, distribute by wire transfer of immediately
available funds to the Purchaser all Principal Prepayments made in
full.”
12. Section
5.03 shall be amended to add; “For first lien Mortgage Loans only,” at the start
of the first sentence. Further, Section 5.03 shall be amended to add as
a third
paragraph; “Notwithstanding anything to the contrary contained herein, the
Company’s obligations to make such Monthly Advances shall only extend to first
lien Mortgage Loans and Company shall not make such Monthly Advances for
any
second lien Mortgage Loan.”
13. Section
5.05 shall be amended to add; “For first lien Mortgage Loans only,” at the start
of the first sentence. Further, Section 5.05 shall be amended to add as
a second
sentence; “Notwithstanding anything to the contrary contained herein, the
Company’s obligations to make such Prepayment Interest Shortfalls shall only
extend to first lien Mortgage Loans and Company shall not make such Prepayment
Interest Shortfalls for any second lien Mortgage Loan.”
14. Section
9.01(viii) shall be amended to replace “or second lien” following the term
“first lien
15. Section
11.10 shall be amended to include the following as a third
paragraph:
“The
Company agrees that the Company (i) shall comply with any applicable laws
and
regulations regarding the privacy and security of Consumer Information
including, but not limited to the Xxxxx-Xxxxx-Xxxxxx
Act, Title V, Subtitle A, 15 U.S.C. § 6801 et seq.,
(ii)
shall not use Consumer Information in any manner inconsistent with any
applicable laws and regulations regarding the privacy and security of Consumer
Information, (iii) shall not disclose Consumer Information to third parties
except at the specific written direction of the Purchaser, (iv) shall maintain
adequate physical, technical and administrative safeguards to protect Consumer
Information from unauthorized access as provided by the applicable laws
and
regulations, and (v) shall immediately notify the Purchaser of any actual
or
suspected breach of the confidentiality of Consumer Information that would
have
a material and adverse effect on the Purchaser. Consumer Information
includes, but is not limited to, all personal information about the Mortgagors
that is supplied to the Purchaser by or on behalf of the Company. The
Company agrees that the Company shall indemnify, defend and hold the Purchaser
harmless from and against any loss, claim or liability the Purchaser may
suffer
by reason of the Company's failure to perform the obligations set forth
in this
Section 11.10.”
16. Section
11.18 shall be amended to include; “Notwithstanding
anything to the contrary in this Section 11.18, the Company agrees that
it is
required to perform the obligations described in Exhibit K hereto” at the end of
the first flush paragraph.
17. Section
11.19 shall be deleted in its entirety and replaced with the
following:
Section
11.19. Monthly
Reporting with Respect to a Reconstitution.
As
long
as the Company continues to service Mortgage Loans and until the Company
has
updated its servicing or reporting system to report on a transmittal basis,
the
Company agrees that with respect to any Mortgage Loan sold or transferred
pursuant to a Reconstitution as described in Section 11.18 of this Agreement
(a
“Reconstituted Mortgage Loan”), the Company, at its expense, shall provide the
Purchaser with the information set forth in Exhibit J attached hereto for
each
Reconstituted Mortgage Loan in Excel or such electronic delimited file
format as
may be mutually agreed upon by both Purchaser and Company. Such information
shall be provided monthly for all Reconstituted Mortgage Loans on the fifth
(5th)
Business Day of each month for the immediately preceding monthly period,
and
shall be transmitted to xxxx.xxxx@xxxx.xxx.
The
Company and Purchaser agree that the Company shall inform Purchaser when
it has
updated its servicing or reporting system to report on a transmittal basis.
At
such time, Company and Purchaser agree to determine how, if it all, any
reports
should be sent under this Section 11.19.
18. Section
11.21 shall be added to the Agreement:
Section
11.21. Signature
Pages/Counterparts. Notwithstanding
anything to the contrary in the Agreement, this Term Sheet shall be executed
by
each party (i) in one or more fully executed copies, each of which shall
constitute a fully executed original Term Sheet, and/or (ii) in counterparts
having one or more original signatures, and all such counterparts containing
the
original signatures of all of the parties hereto taken together shall constitute
a fully executed original Term Sheet, and/or (iii) by delivery of one or
more
original signed signature pages to the other parties hereto (x) by mail
or
courier, and/or (y) by electronic transmission, including without limitation
by
telecopier, facsimile or email of a scanned image (“Electronic Transmission”),
each of which as received shall constitute for all purposes an executed
original
signature page of such party. The Purchaser may deliver a copy of this
Term
Sheet, fully executed as provided herein, to each other party hereto by
mail
and/or courier and/or Electronic Transmission, and such copy as so delivered
shall constitute a fully executed original Term Sheet, superseding any
prior
form of the Term Sheet that differs therefrom in any respect related to
the
Mortgage Loans hereunder.”
19. Capitalized
terms used but not defined herein shall have the meanings ascribed to them
in
the Agreement.
20. All
other
terms and conditions of the Agreement remain unchanged and in full force
and
effect.
IN
WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to
be
executed and delivered by their proper and duly authorized officers as
of the
day and year first above written.
EMC
MORTGAGE CORPORATION
Purchaser
By:________________________
Name:
Title:
FIRST
HORIZON HOME LOAN
CORPORATION
Seller
By:
_______________________
Name:
Title:
FIRST
TENNESSEE MORTGAGE
SERVICES,
INC.
Servicer
By:
_______________________
Name:
Title:
EXHIBIT
J
RECONSTITUTED
MORTGAGE LOAN REPORTING
(Reports
sent electronically in Text or Excel Format)
(a) Servicer
Mortgage Loan Number
(b) FNMA
Mortgage Loan Number (if applicable)
(c) Lender/Seller
Mortgage Loan Number (plus any other loan number)
(d) Month
end
date/ date file created
(e) Scheduled
Beginning Balance
(f) Actual
Beginning Balance
(g) Scheduled
Ending Balance
(h) Actual
Ending Balance
(i) Gross
Rate (current gross rate)
(j) Net
Rate
(current passthrough)
(k) Last
Payment Date (LPI_DATE in Fannie's Laser Reporting)- S/S reporting
only
(l) Next
Due
Date -
A/A
reporting only
(m)
Default Reporting Data
(i)
Servicer Loan Number
(ii)
Investor Loan Number
(iii)
Borrower Last Name
(iv)
60
Days
(v)
90
Days
(vi)
120
Days & Over
(vii)
Due
Date
(viii)
Status Code
(ix)
Foreclosure Start Date
(x)
Foreclosure End Date
(xi)
Foreclosure Sale Date
(xii)Bankruptcy
Chapter
(xiii)
Bankruptcy Start Date
(xiv)
Bankruptcy End Date
(xv)
Bankruptcy Post Petition Due Date
(xvi)
Bankruptcy Case #
(xvii)
REO Start Date
(xviii)
REO Sale Date
(xix)
Comment
EXHIBIT
K
COMPANY’S
OBLIGATIONS IN CONNECTION
WITH
A
RECONSTITUTION
| · |
The
Company shall (i) possess the ability to service to a securitization
documents; (ii) service on a “Scheduled/Scheduled” reporting basis
(advancing through the liquidation of an REO Property), (iii)
make
compensating interest payments on payoffs and curtailments and
(iv) remit
and report to a master servicer in format acceptable to such
master
servicer.
|
| · |
The
Company shall provide an acceptable annual certification (officer’s
certificate) to the master servicer (as required by the Xxxxxxxx-Xxxxx
Act
of 2002) as well as any other annual certifications required
under the
securitization documents (i.e. the annual statement as to
compliance/annual independent certified public accountants’ servicing
report due).
|
| · |
The
Company shall allow for the Purchaser, the master servicer or
their
designee to perform a review of audited financials and net worth
of the
Company.
|
| · |
The
Company shall provide a Uniform Single Attestation Program certificate
and
Management Assertion as requested by the master servicer and/or
the
Purchaser.
|
| · |
The
Company shall provide information on each Custodial Account as
requested
by the master servicer and/or the Purchaser, and each Custodial
Accounts
shall comply with the requirements for such accounts as set forth
in the
securitization documents.
|
| · |
The
Company shall provide any additional information as reasonably
requested
by Purchaser and/or the master
servicer.
|
AMENDMENT
NO. 3 TO PURCHASE, WARRANTIES
AND
SERVICING AGREEMENT
THIS
AMENDMENT NO. 3, effective as of August 8, 2005, amends the Purchase, Warranties
and Servicing Agreement among EMC Mortgage Corporation (the “Purchaser”), First
Tennessee Mortgage Services, Inc., as servicer (the “Servicer”) and First
Horizon Home Loan Corporation (the “Seller”, and together with the Servicer, the
“Company”), previously entered into as of September 1, 2003 (the “Agreement”),
as previously amended.
RECITALS
WHEREAS,
the Seller sells to the Purchaser, and the Purchaser purchases from the
Seller,
from time to time, pursuant to the Agreement, certain conventional residential
Mortgage Loans on a servicing retained basis serviced by the Servicer,
including
second lien loans; and
WHEREAS,
in connection with future sales of Mortgage Loans to the Purchaser, the
Company
and the Purchaser wish to amend the Agreement as set forth below.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants hereinafter
set forth and for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Purchaser and the Company agree to
amend
the Agreement as follows:
| 1. |
Section
2.09 shall be deleted in its entirety and replaced with the
following:
|
Section
2.09 Near-term
Principal Prepayments in Full; Near Term Payment Defaults
In
the
event any Principal Prepayment in full is made by a Mortgagor on or prior
to
three months after the related Closing Date, the Company shall remit to
the
Purchaser an amount equal to the excess, if any, of the Purchase Price
Percentage over par multiplied by the amount of such Principal Prepayment
in
full, provided however, that the Company shall not be required to remit
any
payments to the Purchaser pursuant to this paragraph unless the Purchaser
has
notified the Company within one hundred eighty (180) days following Closing
Date. Such remittance shall be made by the Company to Purchaser not later
than
five (5) Business Days after notice to the Company.
In
the
event either of the first three (3) scheduled Monthly Payments which are
due
under any Mortgage Loan after the related Cut-off Date are not made during
the
month in which such Monthly Payments are due, then not later than five
(5)
Business Days after notice to the Company by Purchaser (and at Purchaser’s sole
option), the Company, shall repurchase such Mortgage Loan from the Purchaser
pursuant to the repurchase provisions contained in this Subsection 3.03,
provided however, that the Company shall not be required to repurchase
any
Mortgage Loan pursuant to this paragraph unless the Purchaser has notified
the
Company within one hundred eighty (180) days following Closing
Date.
2. Capitalized
terms used but not defined herein shall have the meanings ascribed to them
in
the Agreement.
3. All
other
terms and conditions of the Agreement remain unchanged and in full force
and
effect.
IN
WITNESS WHEREOF, the parties hereto have caused this Amendment No. 3 to
be
executed and delivered by their proper and duly authorized officers as
of the
day and year first above written.
EMC
MORTGAGE CORPORATION
Purchaser
By:________________________
Name:
Title:
FIRST
HORIZON HOME LOAN
CORPORATION
Seller
By:
_______________________
Name:
Title:
FIRST
TENNESSEE MORTGAGE
SERVICES,
INC.
Servicer
By:
_______________________
Name:
Title:
AMENDMENT
NUMBER FOUR
to
the
PURCHASE,
WARRANTIES AND SERVICING AGREEMENT
Dated
as
of September 1, 2003
among
EMC
MORTGAGE CORPORATION,
as
Purchaser
and
FIRST
TENNESSEE MORTGAGE SERVICES, INC.
as
Servicer,
FIRST
HORIZON HOME LOAN CORPORATION,
as
Seller
This
AMENDMENT NUMBER FOUR (this “Amendment”) is made and entered into this
22nd
day of
December, 2005, by and among EMC Mortgage Corporation, a Delaware corporation,
as purchaser (the “Purchaser”) and First Tennessee Mortgage Services, Inc., as
servicer (the “Servicer”) and First Horizon Home Loan Corporation (the “Seller”,
and together with the Servicer, the “Company”) in connection with the Purchase,
Warranties and Servicing Agreement, dated as of September 1, 2003, between
the
above mentioned parties (the “Agreement”).
RECITALS
WHEREAS,
the
parties hereto have entered into the Agreement;
WHEREAS,
the Agreement provides that the parties thereto may enter into an amendment
to
the Agreement;
WHEREAS,
the parties hereto desire to amend the Agreement as set forth in this Amendment;
and
NOW,
THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
the
parties hereto agree as follows:
1. Capitalized
terms used herein and not defined herein shall have the meanings assigned
to
such terms in the Agreement.
2. Article
I
of the Agreement is hereby amended effective as of the date hereof by adding
the
following definitions to Section 1.01:
Commission
or SEC:
The
Securities and Exchange Commission.
Exchange
Act:
The
Securities Exchange Act of 1934, as amended.
Pass-Through
Transfer:
Any
transaction involving either (1) a sale or other transfer of some or all
of the
Mortgage Loans directly or indirectly to an issuing entity in connection
with an
issuance of publicly offered or privately placed, rated or unrated
mortgage-backed securities or (2) an issuance of publicly offered or privately
placed, rated or unrated securities, the payments on which are determined
primarily by reference to one or more portfolios of residential mortgage
loans
consisting, in whole or in part, of some or all of the Mortgage
Loans.
Qualified
Correspondent:
Any
Person from which the Company purchased Mortgage Loans, provided that the
following conditions are satisfied: (i) such Mortgage Loans were originated
pursuant to an agreement between the Company and such Person that contemplated
that such Person would underwrite mortgage loans from time to time, for
sale to
the Company, in accordance with underwriting guidelines designated by the
Company (“Designated Guidelines”) or guidelines that do not vary materially from
such Designated Guidelines; (ii) such Mortgage Loans were in fact underwritten
as described in clause (i) above and were acquired by the Company within
180
days after origination; (iii) either (x) the Designated Guidelines were,
at the
time such Mortgage Loans were originated, used by the Company in origination
of
mortgage loans of the same type as the Mortgage Loans for the Company’s own
account or (y) the Designated Guidelines were, at the time such Mortgage
Loans
were underwritten, designated by the Company on a consistent basis for
use by
lenders in originating mortgage loans to be purchased by the Company; and
(iv)
the Company employed, at the time such Mortgage Loans were acquired by
the
Company, pre-purchase or post-purchase quality assurance procedures (which
may
involve, among other things, review of a sample of mortgage loans purchased
during a particular time period or through particular channels) designed
to
ensure that Persons from which it purchased mortgage loans properly applied
the
underwriting criteria designated by the Company.
Regulation
AB:
Subpart
229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as 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.
Securities
Act:
The
Securities Act of 1933, as amended.
Servicing
Criteria:
As of
any date of determination, the “servicing criteria” set forth in Item 1122(d) of
Regulation AB, or any amendments thereto, a summary of the requirements
of which
as of the date hereof is attached hereto as Exhibit M for convenience of
reference only. In the event of a conflict or inconsistency between the
terms of
Exhibit M and the text of Item 1122(d) of Regulation AB, the text of Item
1122(d) of Regulation AB shall control.
Static
Pool Information:
Static
pool information as described in Item 1105(a)(1)-(3) and 1105(c) of Regulation
AB.
Subcontractor:
Any
vendor, subcontractor or other Person that is not responsible for the overall
servicing (as “servicing” is commonly understood by participants in the
mortgage-backed securities market) of Mortgage Loans but performs one or
more
discrete functions identified in Item 1122(d) of Regulation AB with respect
to
Mortgage Loans under the direction or authority of the Company or a Subservicer.
Subservicer:
Any
Person that services Mortgage Loans on behalf of the Company 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 Company under this Agreement or any
Reconstitution Agreement that are identified in Item 1122(d) of Regulation
AB.
Third-Party
Originator:
Each
Person, other than a Qualified Correspondent, that originated Mortgage
Loans
acquired by the Company.
3. Article
III of the Agreement is hereby amended effective as of the date hereof
by
revising Section 3.01(n) as follows (new text underlined):
(n) Company
has delivered to the Purchaser financial statements of its parent, for
its last
two complete fiscal years. All such financial information fairly presents
the
pertinent results of operations and financial position for the period identified
and has been prepared in accordance with GAAP consistently applied throughout
the periods involved, except as set forth in the notes thereto. There has
been
no change in the servicing
policies and procedures,
business, operations, financial condition, properties or assets of the
Company
since the date of the Company’s financial information that would have a material
adverse effect on its ability to perform its obligations under this
Agreement;
4. Article
III of the Agreement is hereby amended effective as of the date hereof
by adding
the following new Section 3.01(p):
(p) As
of the
date of each Pass-Through Transfer, and except as has been otherwise disclosed
to the Purchaser: (1) no default or servicing related performance trigger
has
occurred as to any other securitization due to any act or failure to act
of the
Company; (2) no material noncompliance with applicable servicing criteria
as to
any other securitization has been disclosed or reported by the Company;
(3) the
Company 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; (4) no material changes to the Company’s
servicing policies and procedures for similar loans has occurred in the
preceding three years; (5) there are no aspects of the Company’s financial
condition that could have a material adverse impact on the performance
by the
Company of its obligations hereunder; (6) there are no legal proceedings
pending, or known to be contemplated by governmental authorities, against
the
Company that could be material to investors in the securities issued in
such
Pass-Through Transfer; and (7) there are no affiliations, relationships
or
transactions relating to the Company of a type that are described under
Item
1119 of Regulation AB.
5. Article
III of the Agreement is hereby amended effective as of the date hereof
by adding
the following new Section 3.01(q):
(q) If
so
requested by the Purchaser or any Depositor on any date, the Company shall,
within five Business Days following such request, confirm in writing the
accuracy of the representations and warranties set forth in Section 3.01(p)
of
this Section or, if any such representation and warranty is not accurate
as of
the date of such request, provide reasonably adequate disclosure of the
pertinent facts, in writing, to the requesting party.
6. Article
III of the Agreement is hereby amended effective as of the date hereof
by adding
the following new Section 3.01(r):
(r) 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 Company shall (or shall cause each Subservicer
and
Third-Party Originator to) (i) notify the Purchaser and any Depositor in
writing
of (A) any material litigation or governmental proceedings pending against
the
Company, any Subservicer or any Third-Party Originator and (B) any affiliations
or relationships that develop following the closing date of a Pass-Through
Transfer between the Company, any Subservicer or any Third-Party Originator
and
any of the parties specified in clause (7) of paragraph (p) of this Section
(and
any other parties identified in writing by the requesting party) with respect
to
such Pass-Through Transfer, and (ii) provide to the Purchaser and any Depositor
a description of such proceedings, affiliations or relationships.
7. Article
III of the Agreement is hereby amended effective as of the date hereof
by adding
the following new Section 3.01(s):
(s) As
a
condition to the succession to the Company or any Subservicer as servicer
or
subservicer under this Agreement or any Reconstitution Agreement by any
Person
(i) into which the Company or such Subservicer may be merged or consolidated,
or
(ii) which may be appointed as a successor to the Company or any Subservicer,
the Company 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.
8. Article
IV of the Agreement is hereby amended effective as of the date hereof by
revising the first paragraph of Section 4.03 by adding the following after
the
first sentence:
In
determining the delinquency status of any Mortgage Loan, the Company will
use
delinquency recognition policies as described to and approved by the Purchaser,
and shall revise these policies as requested by the Purchaser from time
to
time.
9. Article
V
of the Agreement is hereby amended effective as of the date hereof by deleting
Section 5.02 in its entirety and replacing it with the following:
Section
5.02 Statements
to the Purchaser.
The
Company shall furnish to Purchaser an individual loan accounting report,
as of
the last Business Day of each month, in the Company's assigned loan number
order
to document Mortgage Loan payment activity on an individual Mortgage Loan
basis.
With respect to each month, the corresponding individual loan accounting
report
shall be received by the Purchaser no later than the fifth Business Day
of the
following month on a disk or tape or other computer-readable format in
such
format as may be mutually agreed upon by both Purchaser and Company, and
shall
contain the following:
(i) with
respect to each Mortgage Loan and each Monthly Payment, the amount of such
remittance allocable to principal (including a separate breakdown of any
Principal Prepayment, including the date of such prepayment, and any prepayment
penalties or premiums, along with a detailed report of interest on principal
prepayment amounts remitted in accordance with Section 4.04);
(ii) reserved;
(iii) reserved;
(iv) the
Stated Principal Balance of each Mortgage Loan and the aggregate Stated
Principal Balance of all Mortgage Loans as of the first day of the distribution
period and the last day of the distribution period;
(v) with
respect to each Mortgage Loan, the current Mortgage Interest Rate;
(vi) with
respect to each Mortgage Loan, the aggregate amount of any Insurance Proceeds,
Condemnation Proceeds, Liquidation Proceeds and REO Disposition Proceeds
received during the prior distribution period;
(vii) reserved;
(viii) reserved;
(ix) the
number of Mortgage Loans as of the first day of the distribution period
and the
last day of the distribution period;
(x) with
respect to each Mortgage Loan, the Stated Principal Balance of each Mortgage
Loan (a) delinquent as grouped in the following intervals through final
liquidation of such Mortgage Loan: 30 to 59 days, 60 to 89 days, 90 days
or
more; (b) as to which foreclosure has commenced; and (c) as to which REO
Property has been acquired;
(xi) with
respect to each Mortgage Loan, the amount and severity of any realized
loss
following liquidation of such Mortgage Loan;
(xii) with
respect to each Mortgage Loan, and in the aggregate for all Mortgage Loans,
the
amount of any Monthly Advances made by the Company during the prior distribution
period;
(xiii) reserved;
(xiv) reserved;
(xv) reserved;
(xvi) with
respect to any Mortgage Loan, a description of any material modifications,
extensions or waivers to the terms, fees, penalties or payments of such
Mortgage
Loan during the prior distribution period or that have cumulatively become
material over time;
(xvii) reserved;
(xviii) reserved;
(xix) with
respect to each Mortgage Loan, the Stated Principal Balance of any Mortgage
Loan
that has been repurchased by the Company in accordance with Section 3.03
herein;
(xx)
any
other information required by Purchaser or master servicer necessary for
compliance with Item 1121 of Regulation AB.
In
addition, the Company shall provide to the Purchaser such other information
known or available to the Company that is necessary in order to provide
the
distribution and pool performance information as required under Item 1121
of
Regulation AB, as amended from time to time, as determined by the Purchaser
in
its sole reasonable discretion. The Company shall also provide a trial
balance,
sorted in Purchaser's assigned loan number order, in the form of Exhibit
E
hereto, and Exhibit F with respect to defaulted mortgage loans, with each
such
report.
The
Company shall prepare and file any and all information statements or other
filings required to be delivered to any governmental taxing authority or
to
Purchaser pursuant to any applicable law with respect to the Mortgage Loans
and
the transactions contemplated hereby. In addition, the Company shall provide
Purchaser with such information concerning the Mortgage Loans as is necessary
for Purchaser to prepare its federal income tax return as Purchaser may
reasonably request from time to time.
10. Article
VI of the Agreement is hereby amended effective as of the date hereof by
deleting Section 6.04 in its entirety and replacing it with the
following:
Section
6.04 Annual
Statement as to Compliance; Annual Certification.
(a) The
Company will deliver to the Purchaser, to deliver to the Purchaser or its
designee on or before March 1 of each calendar year beginning in 2006,
but in no
event later than March 15th
of each
calendar year beginning in 2006, an Officers’ Certificate acceptable to the
Purchaser (an “Annual Statement of Compliance”) stating, as to each signatory
thereof, that (i) a review of the activities of the Company during the
preceding
calendar year and of performance under this Agreement or other applicable
servicing agreement has been made under such officers’ supervision and (ii) to
the best of such officers’ knowledge, based on such review, the Company has
fulfilled all of its obligations under this Agreement or other applicable
servicing agreement in all material respects throughout such year, or,
if there
has been a failure to fulfill any such obligation in any material respect,
specifying each such failure known to such officer and the nature and status
of
cure provisions thereof. Such Annual Statement of Compliance shall contain
no
restrictions or limitations on its use. Copies of such statement shall
be
provided by the Company to the Purchaser upon request and by the Purchaser
to
any Person identified as a prospective purchaser of the Mortgage Loans.
In the
event that the Company has delegated any servicing responsibilities with
respect
to the Mortgage Loans to a Subservicer, the Company shall deliver an officer’s
certificate of the Subservicer as described above as to each Subservicer
as and
when required with respect to the Company.
(b) With
respect to any Mortgage Loans that are the subject of a Pass-Through Transfer,
by on or before March 1 of each calendar year beginning in 2006, but in
no event
later than March 15th
of each
calendar year beginning in 2006, an officer of the Company shall execute
and
deliver an Officers’ Certificate (an “Annual Certification”) to the Purchaser,
any master servicer which is master servicing loans in connection with
such
transaction (a “Master Servicer”) and any related depositor (a “Depositor”) for
the benefit of each such entity and such entity’s affiliates and the officers,
directors and agents of any such entity and such entity’s affiliates, in the
form attached hereto as Exhibit L. In the event that the Company has delegated
any servicing responsibilities with respect to the Mortgage Loans to a
Subservicer, the Company shall deliver an officers’ certificate of the
Subservicer as described above as to each Subservicer as and when required
with
respect to the Company.
Failure
of the Company to timely comply with this Section 6.04 shall be deemed
an Event
of Default, automatically, without notice and without any cure period,
and
Purchaser may, in addition to whatever rights the Purchaser may have under
Sections 3.03 and 8.01 and at law or equity or to damages, including injunctive
relief and specific performance, terminate all the rights and obligations
of the
Company under this Agreement and in and to the Mortgage Loans and the proceeds
thereof without compensating the Company for the same, as provided in Section
9.01. Such termination shall be considered with cause pursuant to Section
10.01
of this Agreement. This paragraph shall supercede any other provision in
this
Agreement or any other agreement to the contrary.
11. Article
VI of the Agreement is hereby amended effective as of the date hereof by
deleting Section 6.05 in its entirety and replacing it with the
following:
Section
6.05 Annual
Independent Certified Public Accountants' Servicing Report.
The
Company, at its expense and on or before March 1 of each calendar year
beginning
in 2006, but in no event later than March 15th
of each
calendar year beginning in 2006, shall cause a firm of independent public
accountants which is a member of the American Institute of Certified Public
Accountants to furnish a report (a “USAP Report”) to the Purchaser acceptable to
the Purchaser to the effect that such firm has examined certain documents
and
records relating to the Company's servicing of mortgage loans of the same
type
as the Mortgage Loans pursuant to servicing agreements substantially similar
to
this Agreement, which agreements may include this Agreement, and that,
on the
basis of such an examination, conducted substantially in the uniform single
audit program for mortgage bankers, such firm is of the opinion that the
Company's servicing has been conducted in compliance with the agreements
examined pursuant to this Section 6.05 during the preceding calendar year,
except for (i) such exceptions as such firm shall believe to be immaterial,
and
(ii) such other exceptions as shall be set forth in such USAP Report. Such
USAP
Report shall contain no restrictions or limitations on its use. Copies
of such
USAP Report shall be provided by the Company to the Purchaser. In addition,
on
an annual basis, Company shall provide Purchaser with copies of its audited
financial statements.
In
the
event that the Company has delegated any servicing responsibilities with
respect
to the Mortgage Loans to a Subservicer, the Company shall provide a USAP
report
of the Subservicer as described above as to each Subservicer as and when
required with respect to the Company.
Notwithstanding
the foregoing, the Company’s obligation to deliver a USAP Report under this
Section, as to the Company or any Subservicer, as to any calendar year,
beginning with the report required in February 2007, shall be satisfied
if an
Assessment of Compliance and Attestation Report is delivered in compliance
with
Section 6.07 for such calendar year with respect to that entity.
Failure
of the Company to timely comply with this Section 6.05 shall be deemed
an Event
of Default, automatically, without notice and without any cure period,
and
Purchaser may, in addition to whatever rights the Purchaser may have under
Sections 3.03 and 8.01 and at law or equity or to damages, including injunctive
relief and specific performance, terminate all the rights and obligations
of the
Company under this Agreement and in and to the Mortgage Loans and the proceeds
thereof without compensating the Company for the same, as provided in Section
9.01. Such termination shall be considered with cause pursuant to Section
10.01
of this Agreement. This paragraph shall supercede any other provision in
this
Agreement or any other agreement to the contrary.
12. Article
VI of the Agreement is hereby amended effective as of the date hereof by
adding
the following new Section 6.07:
Section
6.07 Assessment
of Compliance with Servicing Criteria.
On
and
after January 1, 2006, the Company shall service and administer, and shall
cause
each subservicer to servicer or administer, the Mortgage Loans in accordance
with all applicable requirements of the Servicing Criteria.
With
respect to any Mortgage Loans that are the subject of a Pass-Through Transfer,
the Company shall deliver to the Purchaser or its designee on or before
February
28 of each calendar year beginning in 2007, a report (an “Assessment of
Compliance”) reasonably satisfactory to the Purchaser regarding the Company’s
assessment of compliance with the Servicing Criteria during the preceding
calendar year as required by Rules 13a-18 and 15d-18 of the Exchange Act
and
Item 1122 of Regulation AB, which as of the date hereof, require a report
by an
authorized officer of the Company that contains the following:
(a) A
statement by such officer of its responsibility for assessing compliance
with
the Servicing Criteria applicable to the Company;
(b) A
statement by such officer that such officer used the Servicing Criteria
to
assess compliance with the Servicing Criteria applicable to the
Company;
(c) An
assessment by such officer of the Company’s compliance with the applicable
Servicing Criteria for the period consisting of the preceding calendar
year,
including disclosure of any material instance of noncompliance with respect
thereto during such period, which assessment shall be based on the activities
it
performs with respect to asset-backed securities transactions taken as
a whole
involving the Company, that are backed by the same asset type as the Mortgage
Loans;
(d) A
statement that a registered public accounting firm has issued an attestation
report on the Company’s Assessment of Compliance for the period consisting of
the preceding calendar year; and
(e) A
statement as to which of the Servicing Criteria, if any, are not applicable
to
the Company, which statement shall be based on the activities it performs
with
respect to asset-backed securities transactions taken as a whole involving
the
Company, that are backed by the same asset type as the Mortgage
Loans.
Such
report at a minimum shall address each of the Servicing Criteria specified
on a
certification substantially in the form of Exhibit O hereto delivered to
the
Purchaser concurrently with the execution of this Agreement.
With
respect to any Mortgage Loans that are the subject of a Pass-Through Transfer,
on or before February 28 of each calendar year beginning in 2007, the Company
shall furnish to the Purchaser or its designee a report (an “Attestation
Report”) by a registered public accounting firm that attests to, and reports on,
the Assessment of Compliance made by the Company, as required by Rules
13a-18
and 15d-18 of the Exchange Act and Item 1122(b) of Regulation AB, which
Attestation Report must be made in accordance with standards for attestation
reports issued or adopted by the Public Company Accounting Oversight Board.
The
Company shall cause each Subservicer, and each Subcontractor determined
by the
Company pursuant to Section 11.19 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 Sections 6.07.
If
the
Company cannot deliver the related Assessment of Compliance or Attestation
Report by February 28th of such year, the Purchaser, at its sole option,
may
permit a cure period for the Company to deliver such Assessment of Compliance
or
Attestation Report, but in no event later than March 10th of such
year.
Failure
of the Company to timely comply with this Section 6.07 shall be deemed
an Event
of Default, automatically, without notice and without any cure period,
and
Purchaser may, in addition to whatever rights the Purchaser may have under
Sections 3.03 and 8.01 and at law or equity or to damages, including injunctive
relief and specific performance, terminate all the rights and obligations
of the
Company under this Agreement and in and to the Mortgage Loans and the proceeds
thereof without compensating the Company for the same, as provided in Section
9.01. Such termination shall be considered with cause pursuant to Section
10.01
of this Agreement. This paragraph shall supercede any other provision in
this
Agreement or any other agreement to the contrary.
13. Article
VI of the Agreement is hereby amended effective as of the date hereof by
adding
the following new Section 6.08:
Section
6.08 Intent
of the Parties; Reasonableness.
The
Purchaser and the Company acknowledge and agree that a purpose of Sections
3.01(p), 5.02, 6.04, 6.05, 6.07 and 11.18 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. 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. The Company 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 Pass-Through Transfer, the Company 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 Company, any Subservicer, any Third-Party Originator
and the Mortgage Loans, or the servicing of the Mortgage Loans, reasonably
believed by the Purchaser or any Depositor to be necessary in order to
effect
such compliance.
14. Article
XI of the Agreement is hereby amended effective as of the date hereof by
restating Section 11.18 in its entirety as follows:
Section
11.18. Cooperation
of Company with a Reconstitution.
The
Company and the Purchaser agree that with respect to some or all of the
Mortgage
Loans, on or after the related Closing Date, on one or more dates (each
a
"Reconstitution Date") at the Purchaser's sole option and with Purchaser’s best
efforts to provide notice to the Company fifteen (15) days prior to the
Reconstitution Date, the Purchaser may effect one or more sales, but in
no event
greater than three (3) per pool of Mortgage Loans sold under the related
Term
Sheet (each, a "Reconstitution") of some or all of the Mortgage Loans then
subject to this Agreement, without recourse, to:
(a) one
or
more third party purchasers in one or more in whole loan transfers (each,
a
"Whole Loan Transfer"); or
(b) one
or
more trusts or other entities to be formed as part of one or more Pass-Through
Transfers.
The
Company agrees to execute in connection with any agreements among the Purchaser,
the Company, and any servicer in connection with a Whole Loan Transfer,
an
Assignment, Assumption and Recognition Agreement substantially in the form
of
Exhibit D hereto, or, at Purchaser’s request, a seller's warranties and
servicing agreement or a participation and servicing agreement or similar
agreement in form and substance reasonably acceptable to the parties, and
in
connection with a Pass-Through Transfer, a pooling and servicing agreement
in
form and substance reasonably acceptable to the parties, (collectively
the
agreements referred to herein are designated, the “Reconstitution Agreements”).
It is understood that any such Reconstitution Agreements will not contain
any
greater obligations on the part of Company than are contained in this Agreement.
Notwithstanding anything to the contrary in this Section 11.18, the Company
agrees that it is required to perform the obligations described in Exhibit
K
hereto.
With
respect to each Whole Loan Transfer and each Pass-Through Transfer entered
into
by the Purchaser, the Company 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 (each, a "Reconstitution Date").
In
addition, the Company shall provide to such 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 Company, whether through letters of its auditors
and
counsel or otherwise, as the Purchaser or any such other participant shall
request upon reasonable demand;
(ii) such
additional representations, warranties, covenants, opinions of counsel,
letters
from auditors, and certificates of public officials or officers of the
Company
as are reasonably agreed upon by the Company and the Purchaser or any such
other
participant;
(iii) within
5
Business Days after request by the Purchaser, the information with respect
to
the Company (as originator) and each Third-Party Originator of the Mortgage
Loans as required under Item 1110(a) and (b) of Regulation AB, a summary
of the
requirements of which has of the date hereof is attached hereto as Exhibit
N for
convenience of reference only, as determined by Purchaser in its sole reasonable
discretion. If requested by the Purchaser, this will include information
about
the applicable credit-granting or underwriting criteria;
(iv) within
5
Business Days after request by the Purchaser, to the extent that is required
Regulation AB, the Company shall provide, to the extent that is reasonably
available to the Company (and not otherwise available to the Purchaser)
without
unreasonable burden, cost or expense (or, as applicable, cause each Third-Party
Originator to provide) Static Pool Information with respect to the mortgage
loans (of a similar type as the Mortgage Loans, as reasonably identified
by the
Purchaser as provided below) serviced by the Company or any Third-Party
Originator for a period of 120 days or more and originated by (i) the Company,
if the Company is an originator of Mortgage Loans (including as an acquirer
of
Mortgage Loans from a Qualified Correspondent), and/or (ii) each Third-Party
Originator in each case to the extent such mortgage loans were purchased
from
the Company by the Purchaser. Such Static Pool Information shall be prepared
by
the Company (or Third-Party Originator) on the basis of its reasonable,
good
faith interpretation of the requirements of Item 1105(a)(1)-(3) and (c)
of
Regulation AB for such period of time the Company or Third-Party Origination
serviced such mortgage loans. To the extent that there is reasonably available
to the Company (or Third-Party Originator), without unreasonable effort
or
expense Static Pool Information with respect to more than one mortgage
loan
type, the Purchaser or any Depositor shall be entitled to specify whether
some
or all of such information shall be provided pursuant to this paragraph.
The
content of such Static Pool Information may be in the form customarily
provided
by the Company, and need not be customized for the Purchaser or any Depositor.
Such Static Pool Information for each vintage origination year or prior
securitized pool, as applicable, shall be presented in increments no less
frequently than quarterly over the life of the mortgage loans included
in the
vintage origination year or prior securitized pool. The most recent periodic
increment must be as of a date no later than 135 days prior to the date
of the
prospectus or other offering document in which the Static Pool Information
is to
be included or incorporated by reference. The Static Pool Information shall
be
provided in an electronic format that provides a permanent record of the
information provided, such as a portable document format (pdf) file, or
other
such electronic format reasonably required by the Purchaser or the Depositor,
as
applicable. The
Purchaser agrees that it will cooperate with the Company and provide sufficient
and timely notice of any information requirement pertaining to a Securitization
Transaction. The Purchaser will make all reasonable efforts to contain
requests for information, reports or any other materials to items required
for
compliance with Regulation AB, and will refrain from requesting information
that
is not required for such compliance. The Purchaser further agrees to
provide the Company with Static Pool Information regarding the Mortgage
Loans to
the same extent that the Company is required to provide Static Pool Information
with respect to mortgage loans similar to the Mortgage Loans
hereunder. The
Company shall in good faith use its best efforts to supply the Static Pool
Information required hereunder; provided, however, that failure of the
Company
to perform such obligations, after applying all good faith best efforts,
shall
not result in a breach by the Company of the provisions of this
Agreement;
(v) within
5
Business Days after request by the Purchaser, information with respect
to the
Company (as servicer) as required by Item 1108(b) and (c) of Regulation
AB, a
summary of the requirements of which as of the date hereof is attached
hereto as
Exhibit N for convenience of reference only, as determined by Purchaser
in its
sole reasonable discretion. In the event that the Company has delegated
any
servicing responsibilities with respect to the Mortgage Loans to a Subservicer,
the Company shall provide the information required pursuant to this clause
with
respect to the Subservicer;
(vi) within
5
Business Days after request by the Purchaser,
(a)
information regarding any legal proceedings pending (or known to be
contemplated) against the Company (as originator and as servicer) and each
other
originator of the Mortgage Loans and each Subservicer as required by Item
1117
of Regulation AB, a summary of the requirements of which as of the date
hereof
is attached hereto as Exhibit N for convenience of reference only, as determined
by Purchaser in its sole reasonable discretion,
(b)
information regarding affiliations with respect to the Company (as originator
and as servicer) and each other originator of the Mortgage Loans and each
Subservicer as required by Item 1119(a) of Regulation AB, a summary of
the
requirements of which as of the date hereof is attached hereto as Exhibit
N for
convenience of reference only, as determined by Purchaser in its sole reasonable
discretion, and
(c)
information regarding relationships and transactions with respect to the
Company
(as originator and as servicer) and each other originator of the Mortgage
Loans
and each Subservicer as required by Item 1119(b) and (c) of Regulation
AB, a
summary of the requirements of which as of the date hereof is attached
hereto as
Exhibit N for convenience of reference only, as determined by Purchaser
in its
sole reasonable discretion; and
(vii) if
so
requested by the Purchaser, the Company shall provide (or, as applicable,
cause
each Third-Party Originator to provide), at the expense of the Purchaser
(to the
extent of any additional incremental expense associated with delivery pursuant
to this Agreement), such statements and agreed-upon procedures letters
of
certified public accountants reasonably acceptable to the Purchaser or
Depositor, as applicable, pertaining to Static Pool Information relating
to
prior securitized pools for securitizations closed on or after January
1, 2006
or, in the case of Static Pool Information with respect to the Company’s or
Third-Party Originator’s originations or purchases, to calendar months
commencing January 1, 2006, or to any financial information included in
any
other disclosure provided under this Section 11.18, as the Purchaser or
such
Depositor shall reasonably request. Such statements and letters shall be
addressed to and be for the benefit of such parties as the Purchaser or
such
Depositor shall designate, which may include, by way of example, any Sponsor,
any Depositor and any broker dealer acting as underwriter, placement agent
or
initial purchaser with respect to a Pass-Through Transfer. Any such statement
or
letter may take the form of a standard, generally applicable document
accompanied by a reliance letter authorizing reliance by the addressees
designated by the Purchaser or such Depositor.
In
the
event of a conflict or inconsistency between the terms of Exhibit N and
the text
of the applicable Item of Regulation AB as cited above, the text of Regulation
AB, its adopting release and other public statements of the SEC shall
control.
The
Company shall indemnify the Purchaser, each affiliate of the Purchaser,
and each
of the following parties participating in a Pass-Through Transfer: 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 Pass-Through Transfer, 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
Pass-Through Transfer; each broker dealer acting as underwriter, placement
agent
or initial purchaser, each Person who controls any of such parties or the
Depositor (within the meaning of Section 15 of the Securities Act and Section
20
of the Exchange Act); and the respective present and former directors,
officers,
employees 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 under this Section 11.18 by or on behalf of the Company, or provided
under this Section 11.18 by or on behalf of any Subservicer, Subcontractor
or
Third-Party Originator (collectively, the “Company Information”), or (B) the
omission or alleged omission to state in the Company Information a material
fact
required to be stated in the Company 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 Company Information
and
not to any other information communicated in connection with a sale or
purchase
of securities, without regard to whether the Company Information or any
portion
thereof is presented together with or separately from such other
information;
(ii)
any
failure by the Company, any Subservicer, any Subcontractor or any Third-Party
Originator to deliver any information, report, certification, accountants’
letter or other material when and as required under this Section 11.18,
including any failure by the Company to identify pursuant to Section 11.19
any
Subcontractor “participating in the servicing function” within the meaning of
Item 1122 of Regulation AB; or
(iii)
any
breach by the Company of a representation or warranty set forth in Section
3.01
or in a writing furnished pursuant to Section 3.01(q) and made as of a
date
prior to the closing date of the related Pass-Through Transfer, to the
extent
that such breach is not cured by such closing date, or any breach by the
Company
of a representation or warranty in a writing furnished pursuant to Section
3.01(q) to the extent made as of a date subsequent to such closing
date.
All
Mortgage Loans not sold or transferred pursuant to a Reconstitution shall
remain
subject to, and serviced in accordance with the terms of, this Agreement
and the
related Term Sheet, and with respect thereto this Agreement and the related
Term
Sheet shall remain in full force and effect.
15. Article
XI of the Agreement is hereby amended effective as of the date hereof by
adding
the following new Section 11.19:
Section
11.19. Use
of
Subservicers and Subcontractors.
(a) The
Company shall not hire or otherwise utilize the services of any Subservicer
to
fulfill any of the obligations of the Company as servicer under this Agreement
or any Reconstitution Agreement unless the Company complies with the provisions
of paragraph (b) of this Section. The Company 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 Company as servicer under this Agreement or any
Reconstitution Agreement unless the Company complies with the provisions
of
paragraph (d) of this Section.
(b) The
Company shall cause any Subservicer used by the Company (or by any Subservicer)
for the benefit of the Purchaser and any Depositor to comply with the provisions
of this Section and with Sections 3.01(p), 3.01(s), 6.04, 6.05, 6.07 and
11.18
of this Agreement to the same extent as if such Subservicer were the Company,
and to provide the information required with respect to such Subservicer
under
Section 3.01(r) of this Agreement. The Company shall be responsible for
obtaining from each Subservicer and delivering to the Purchaser and any
Depositor any Annual Statement of Compliance required to be delivered by
such
Subservicer under Section 6.04(a), any Assessment of Compliance and Attestation
Report required to be delivered by such Subservicer under Section 6.07
and any
Annual Certification required under Section 6.04(b) as and when required
to be
delivered.
(c) The
Company 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
Company 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.
(d) 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 Company shall cause any such Subcontractor used by the
Company (or by any Subservicer) for the benefit of the Purchaser and any
Depositor to comply with the provisions of Sections 6.07 and 11.18 of this
Agreement to the same extent as if such Subcontractor were the Company.
The
Company shall be responsible for obtaining from each Subcontractor and
delivering to the Purchaser and any Depositor any Assessment of Compliance
and
Attestation Report required to be delivered by such Subcontractor under
Section
6.07, in each case as and when required to be delivered.
16. The
Agreement is hereby amended effective as of the date hereof by adding the
following new Exhibit L:
EXHIBIT
L
FORM
OF
COMPANY CERTIFICATION
I,
[identify certifying individual], certify to the [Trustee] [Seller] [Securities
Administrator] [Mortgage Loan Seller] [Purchaser] and [Master Servicer]
that:
1. Based
on
my knowledge, the information in the Annual Statement of Compliance, the
[USAP
Report]* [Assessment of Compliance and Attestation Report]** and all servicing
reports, officer's certificates and other information provided by the Company
relating to the servicing of the Mortgage Loans taken as a whole, do not
contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under
which
such statements were made, not misleading as of the date of this
certification;
2. Based
on
my knowledge, the information in these reports, taken as a whole, does
not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in light of the circumstances under
which
such statements were made, not misleading as of the last day of the period
covered by such servicing reports.
3. Based
on
my knowledge, the servicing information required to be provided to the
Master
Servicer under the Agreement is included in these reports.
4. I
am
responsible for reviewing the activities performed the Company under the
Agreement and based upon the review required under the Agreement, and except
as
disclosed in the Annual Statement of Compliance or the [USAP Report]*
[Assessment of Compliance and Attestation Report]**, the Company has fulfilled
its obligations under the Agreement.
5. [I
have
disclosed to the Master Servicer's certified public accountants all significant
deficiencies relating to the Company's compliance with the minimum servicing
standards in accordance with a review conduced in compliance with the Uniform
Single Attestation Program for Mortgage Bankers or similar standard as
set forth
in the Agreement.]* [The Assessment of Compliance and Attestation Report
of the
Company have been delivered to the Purchaser as required under the Agreement.
Following is a list of all material instances of noncompliance described
in the
Attestation of Compliance and Attestation Report (if none, state
“none”):
___________________________.]*
[COMPANY]
By:
Name:
Title:
Date:
|
*
|
To
be used if a USAP Report is being delivered under the
Agreement
|
|
**
|
To
be used if an Assessment of Compliance and Attestation Report
is being
delivered under the Agreement
|
17. The
Agreement is hereby amended effective as of the date hereof by adding the
following new Exhibit M:
EXHIBIT
M
SUMMARY
OF REGULATION AB
SERVICING
CRITERIA
NOTE:
This Exhibit M is provided for convenience of reference only. In the event
of a
conflict or inconsistency between the terms of this Exhibit M and the text
of
Regulation AB, the text of Regulation AB, its adopting release and other
public
statements of the SEC shall control.
Item
1122(d)
| (a) |
General
servicing considerations.
|
(1) Policies
and procedures are instituted to monitor any performance or other triggers
and
events of default in accordance with the transaction agreements.
(2) 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.
(3) Any
requirements in the transaction agreements to maintain a back-up servicer
for
the mortgage loans are maintained.
(4) 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.
| (b) |
Cash
collection and administration.
|
(1) 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.
(2) Disbursements
made via wire transfer on behalf of an obligor or
to an
investor are made only by authorized personnel.
(3) 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.
(4) 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.
(5) 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.
(6) Unissued
checks are safeguarded so as to prevent unauthorized access.
(7) 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.
| (c) |
Investor
remittances and reporting.
|
(1) 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.
(2) Amounts
due to investors are allocated and remitted in accordance with timeframes,
distribution priority and other terms set forth in the transaction
agreements.
(3) 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.
(4) Amounts
remitted to investors per the investor reports agree with cancelled checks,
or
other form of payment, or custodial bank statements.
| (d) |
Mortgage
Loan administration.
|
(1) Collateral
or security on mortgage loans is maintained as required by the transaction
agreements or related mortgage loan documents.
(2) Mortgage
loan and related documents are safeguarded as required by the transaction
agreements.
(3) 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.
(4) 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.
(5) The
Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal balance.
(6) 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 mortgage
loan documents.
(7) 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.
(8) 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).
(9) Adjustments
to interest rates or rates of return for mortgage loans with variable rates
are
computed based on the related mortgage loan documents.
(10) 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.
(11) 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.
(12) 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.
(13) 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.
(14) Delinquencies,
charge-offs and uncollectable accounts are recognized and recorded in accordance
with the transaction agreements.
(15) 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.
18. The
Agreement is hereby amended effective as of the date hereof by adding the
following new Exhibit N:
EXHIBIT
N
SUMMARY
OF APPLICABLE REGULATION AB REQUIREMENTS
NOTE:
This Exhibit N is provided for convenience of reference only. In the event
of a
conflict or inconsistency between the terms of this Exhibit N and the text
of
Regulation AB, the text of Regulation AB, its adopting release and other
public
statements of the SEC shall control.
Item
1105(a)(1)-(3) and (c)
-Provide
static pool information with respect to mortgage loans that were originated
or
purchased by the Company and which are of the same type as the Mortgage
Loans.
-Provide
static pool information regarding delinquencies, cumulative losses and
prepayments for prior securitized pools of the Company.
-If
the
Company has less than 3 years experience securitizing assets of the same
type as
the Mortgage Loans, provide the static pool information by vintage origination
years regarding loans originated or purchased by the Company, instead of
by
prior securitized pool. A vintage origination year represents mortgage
loans
originated during the same year.
-Such
static pool information shall be for the prior five years, or for so long
as the
Company has been originating or purchasing (in the case of data by vintage
origination year) or securitizing (in the case of data by prior securitized
pools) such mortgage loans if for less than five years.
-The
static pool information for each vintage origination year or prior securitized
pool, as applicable, shall be presented in monthly increments over the
life of
the mortgage loans included in the vintage origination year or prior securitized
pool.
-Provide
summary information for the original characteristics of the prior securitized
pools or vintage origination years, as applicable and material, including:
number of pool assets, original pool balance, weighted average initial
loan
balance, weighted average mortgage rate, weighted average and minimum and
maximum FICO, product type, loan purpose, weighted average and minimum
and
maximum LTV, distribution of loans by mortgage rate, and geographic
concentrations of 5% or more.
Item
1108(b) and (c)
Provide
the following information with respect to each servicer that will service,
including interim service, 20% or more of the mortgage loans in any loan
group
in the securitization issued in the Pass-Through Transfer:
-a
description of the Company’s form of organization;
-a
description of how long the Company has been servicing residential mortgage
loans; a general discussion of the Company’s experience in servicing assets of
any type as well as a more detailed discussion of the Company’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 Company’s portfolio of mortgage loans of the type similar to
the Mortgage Loans and information on factors related to the Company that
may be
material to any analysis of the servicing of the Mortgage Loans or the
related
asset-backed securities, as applicable, including whether any default or
servicing related performance trigger has occurred as to any other
securitization due to any act or failure to act of the Company, whether
any
material noncompliance with applicable servicing criteria as to any other
securitization has been disclosed or reported by the Company, and the extent
of
outsourcing the Company uses;
-a
description of any material changes to the Company’s policies or procedures in
the servicing function it will perform under this Agreement and any
Reconstitution Agreements for mortgage loans of the type similar to the
Mortgage
Loans during the past three years;
-information
regarding the Company’s financial condition to the extent that there is a
material risk that the effect on one or more aspects of servicing resulting
from
such financial condition could have a material impact on the performance
of the
securities issued in the Pass-Through Transfer, or on servicing of mortgage
loans of the same asset type as the Mortgage Loans;
-any
special or unique factors involved in servicing loans of the same type
as the
Mortgage Loans, and the Company’s processes and procedures designed to address
such factors;
-statistical
information regarding principal and interest advances made by the Company
on the
Mortgage Loans and the Company’s overall servicing portfolio for the past three
years; and
-the
Company’s process for handling delinquencies, losses, bankruptcies and
recoveries, such as through liquidation of REO Properties, foreclosure,
sale of
the Mortgage Loans or workouts.
Item
1110(a)
-Identify
any originator or group of affiliated originators that originated, or is
expected to originate, 10% or more of the mortgage loans in any loan group
in
the securitization issued in the Pass-Through Transfer.
Item
1110(b)
Provide
the following information with respect to any originator or group of affiliated
originators that originated, or is expected to originate, 20% or more of
the
mortgage loans in any loan group in the securitization issued in the
Pass-Through Transfer:
-the
Company’s form of organization; and
-a
description of the Company’s origination program and how long the Company has
been engaged in originating residential mortgage loans, which description
must
include a discussion of the Company’s experience in originating mortgage loans
of the same type as the Mortgage Loans and information regarding the size
and
composition of the Company’s origination portfolio as well as information that
may be material to an analysis of the performance of the Mortgage Loans,
such as
the Company’s credit-granting or underwriting criteria for mortgage loans of the
same type as the Mortgage Loans.
Item
1117
-describe
any legal proceedings pending against the Company or against any of its
property, including any proceedings known to be contemplated by governmental
authorities, that may be material to the holders of the securities issued
in the
Pass-Through Transfer.
Item
1119(a)
-describe
any affiliations of the Company, each other originator of the Mortgage
Loans and
each Subservicer with the sponsor, depositor, issuing entity, trustee,
any
originator, any other servicer, any significant obligor, enhancement or
support
provider or any other material parties related to the Pass-Through
Transfer.
Item
1119(b)
-describe
any business relationship, agreement, arrangement, transaction or understanding
entered into outside of the ordinary course of business or on terms other
than
those obtained in an arm’s length transaction with an unrelated third party,
apart from the Pass-Through Transfer, between the Company, each other originator
of the Mortgage Loans and each Subservicer, or their respective affiliates,
and
the sponsor, depositor or issuing entity or their respective affiliates,
that
exists currently or has existed during the past two years, that may be
material
to the understanding of an investor in the securities issued in the Pass-Through
Transfer.
Item
1119(c)
-describe
any business relationship, agreement, arrangement, transaction or understanding
involving or relating to the Mortgage Loans or the Pass-Through Transfer,
including the material terms and approximate dollar amount involved, between
the
Company, each other originator of the Mortgage Loans and each Subservicer,
or
their respective affiliates and the sponsor, depositor or issuing entity
or
their respective affiliates, that exists currently or has existed during
the
past two years.
19. The
Agreement is hereby amended effective as of the date hereof by adding the
following new Exhibit O:
EXHIBIT
O
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by [the Company] [Name of Subservicer]
shall address, at a minimum, the criteria identified as below as “Applicable
Servicing Criteria”:
|
Servicing
Criteria
|
Applicable
Servicing Criteria
|
|
|
Reference
|
Criteria
|
|
|
|
General
Servicing Considerations
|
|
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or
other triggers
and events of default in accordance with the transaction
agreements.
|
|
|
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.
|
|
|
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.
|
|
|
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.
|
|
|
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.
|
|
|
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.
|
|
|
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.
|
|
|
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.
|
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
|
|
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.
|
|
|
|
|
|
[NAME
OF
COMPANY] [NAME OF SUBSERVICER]
Date: _________________________
By: _________________________
Name:
Title:
20. Except
as
amended above, the Agreement shall continue to be in full force and effect
in
accordance with its terms.
21. This
Amendment may be executed by one or more of the parties hereto on any number
of
separate counterparts and of said counterparts taken together shall be
deemed to
constitute one and the same instrument.
[SIGNATURE
PAGES FOLLOW]
IN
WITNESS WHEREOF, the following parties have caused their names to be signed
hereto by their respective officers thereunto duly authorized as of the
day and
year first above written.
EMC
MORTGAGE CORPORATION,
as
Purchaser
By:________________________
Name:
Title:
FIRST
HORIZON HOME LOAN CORPORATION
Seller
By:
_______________________
Name:
Title:
FIRST
TENNESSEE MORTGAGE SERVICES, INC.
Servicer
By:
_______________________
Name:
Title:
EXHIBIT
R-2
FORM
OF
FIRST TENNESSEE ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT
This
is
an Assignment, Assumption and Recognition Agreement (this “AAR Agreement”) made
as of August 31, 2006, among EMC Mortgage Corporation (the “Assignor”),
Citibank, N.A., not individually but solely as trustee for the holders
of the
SACO I Trust 2006-9, Mortgage Pass-Through Certificates, Series 2006-9
(the
“Assignee”) and First Tennessee Mortgage Services, Inc. (the
“Company”).
In
consideration of the mutual promises contained herein the parties hereto agree
that the residential mortgage loans (the “Assigned Loans”) listed on Attachment
1 annexed hereto (the "Assigned Loan Schedule") purchased by the Assignor
from
First Horizon Home Loan Corporation (“First Horizon”) pursuant to the Purchase,
Warranties and Servicing Agreement, dated as of September 1, 2003, as amended
on
May 14, 2004 (the “Purchase, Warranties and Servicing Agreement”), as amended on
June 16, 2005, as amended on August 8, 2005, and as amended on December
22,
2005, and that certain amended and restated term sheet dated as of September
2,
2005, among Assignor, Company and First Horizon (the
“Term
Sheet”, together with the Purchase, Warranties and Servicing Agreement, the
“Purchase
Agreement”) and now serviced by Company for Assignor and its successors and
assigns pursuant to the Purchase Agreement shall be subject to the terms
of this
AAR Agreement. Capitalized terms used herein but not defined shall have
the
meanings ascribed to them in the Purchase Agreement.
Assignment
and Assumption
Except
as
expressly provided for herein, the Assignor hereby grants, transfers and
assigns
to the Assignee all of its right, title and interest as in, to and under
(a) the
Assigned Loans and (b) the Purchase Agreement with respect to the Assigned
Loans; provided, however, that the Assignor is not assigning to the Assignee
any
of its right, title or interest, in, to and under the Purchase Agreement
with
respect to any mortgage loan other than the Assigned Loans listed on Exhibit
A.
Notwithstanding anything to the contrary contained herein, the Assignor
specifically reserves and does not assign to the Assignee any right, title
and
interest in, to or under the representations and warranties contained in
Section
3.01 and Section 3.02 of the Purchase Agreement, and any obligation of
the
Company to cure, repurchase or substitute for a mortgage loan and to indemnify
the Assignor with respect to a breach of such representations and warranties
pursuant to Section 3.03 and Section 8.01 of the Purchase Agreement and
the
Assignor is retaining the right to enforce the representations and warranties
and the obligations of the Company set forth in those sections against
the
Company. In addition, the Assignor specifically reserves and does not assign
to
the Assignee any right, title and interest in, to or under Section 2.09
of the
Purchase Agreement. Except as is otherwise expressly provided herein, the
Assignor makes no representations, warranties or covenants to the Assignee
and
the Assignee acknowledges that the Assignor has no obligations to the Assignee
under the terms of the Purchase Agreement or otherwise relating to the
transaction contemplated herein (including, but not limited to, any obligation
to indemnify the Assignee).
Representations,
Warranties and Covenants
1.
Assignor
warrants and represents to Assignee and Company as of the date
hereof:
(a) Attached
hereto as Attachment 2 is a true and accurate copy of the Purchase Agreement
which agreement is in full force and effect as of the date hereof and the
provisions of which have not been waived, amended or modified in any respect,
nor has any notice of termination been given thereunder;
(b) Assignor
is the lawful owner of the Assigned Loans with full right to transfer the
Assigned Loans and any and all of its interests, rights and obligations
under
the Purchase Agreement as they relate to the Assigned Loans, free and clear
from
any and all claims and encumbrances; and upon the transfer of the Assigned
Loans
to Assignee as contemplated herein, Assignee shall have good title to each
and
every Assigned Loan, as well as any and all of Assignee’s interests, rights and
obligations under the Purchase Agreement as they relate to the Assigned
Loans,
free and clear of any and all liens, claims and encumbrances;
(c) There
are
no offsets, counterclaims or other defenses available to Company with respect
to
the Assigned Loans or the Purchase Agreement;
(d) Assignor
has no knowledge of, and has not received notice of, any waivers under,
or any
modification of, any Assigned Loan;
(e) Assignor
is duly organized, validly existing and in good standing under the laws
of the
jurisdiction of its incorporation, and has all requisite power and authority
to
acquire, own and sell the Assigned Loans;
(f) Assignor
has full corporate power and authority to execute, deliver and perform
its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this
AAR
Agreement is in the ordinary course of Assignor’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignor’s charter or by-laws or any legal restriction, or any material
agreement or instrument to which Assignor is now a party or by which it
is
bound, or result in the violation of any law, rule, regulation, order,
judgment
or decree to which Assignor or its property is subject. The execution,
delivery
and performance by Assignor of this AAR Agreement and the consummation
by it of
the transactions contemplated hereby, have been duly authorized by all
necessary
corporate action on the part of Assignor. This AAR Agreement has been duly
executed and delivered by Assignor and, upon the due authorization, execution
and delivery by Assignee and Company, will constitute the valid and legally
binding obligation of Assignor enforceable against Assignor in accordance
with
its terms except as enforceability may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws now or hereafter in effect
relating
to creditors’ rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(g) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignor in connection with the execution, delivery or performance by Assignor
of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby;
(h) Neither
Assignor nor anyone acting on its behalf has offered, transferred, pledged,
sold
or otherwise disposed of the Assigned Loans or any interest in the Assigned
Loans, or solicited any offer to buy or accept a transfer, pledge or other
disposition of the Assigned Loans, or any interest in the Assigned Loans
or
otherwise approached or negotiated with respect to the Assigned Loans,
or any
interest in the Assigned Loans with any Person in any manner, or made any
general solicitation by means of general advertising or in any other manner,
or
taken any other action which would constitute a distribution of the Assigned
Loans under the Securities Act of 1933, as amended (the “1933 Act”) or which
would render the disposition of the Assigned Loans a violation of Section
5 of
the 1933 Act or require registration pursuant thereto;
(i) The
Assignor has received from Company, and has delivered to the Assignee,
all
documents required to be delivered to Assignor by the Company prior to
the date
hereof pursuant to the Purchase Agreement with respect to the Assigned
Loans and
has not received, and has not requested from the Company, any additional
documents; and
(j) There
is
no action, suit, proceeding, investigation or litigation pending or, to
Assignor's knowledge, threatened, which either in any instance or in the
aggregate, if determined adversely to Assignor, would adversely affect
Assignor's execution or delivery of, or the enforceability of, this AAR
Agreement, or the Assignor's ability to perform its obligations under this
AAR
Agreement.
2.
Assignee
warrants and represents to, and covenants with, Assignor and Company as
of the
date hereof:
(a) Assignee
is duly organized, validly existing and in good standing under the laws
of the
jurisdiction of its organization and has all requisite power and authority
to
hold the Assigned Loans as trustee on behalf of the holders of the SACO
I Trust
2006-9, Mortgage Pass-Through Certificates, Series 2006-9;
(b) Assignee
has full corporate power and authority to execute, deliver and perform
its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this
AAR
Agreement is in the ordinary course of Assignee’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignee’s charter or by-laws or any legal restriction, or any material
agreement or instrument to which Assignee is now a party or by which it
is
bound, or result in the violation of any law, rule, regulation, order,
judgment
or decree to which Assignee or its property is subject. The execution,
delivery
and performance by Assignee of this AAR Agreement and the consummation
by it of
the transactions contemplated hereby, have been duly authorized by all
necessary
corporate action on part of Assignee. This AAR Agreement has been duly
executed
and delivered by Assignee and, upon the due authorization, execution and
delivery by Assignor and Company, will constitute the valid and legally
binding
obligation of Assignee enforceable against Assignee in accordance with
its terms
except as enforceability may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws now or hereafter in effect
relating
to creditors’ rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(c) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignee in connection with the execution, delivery or performance by Assignee
of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby;
(d) There
is
no action, suit, proceeding, investigation or litigation pending or, to
Assignee's knowledge, threatened, which either in any instance or in the
aggregate, if determined adversely to Assignee, would adversely affect
Assignee's execution or delivery of, or the enforceability of, this AAR
Agreement, or the Assignee's ability to perform its obligations under this
AAR
Agreement; and
(e) Assignee
assumes for the benefit of each of the Assignor and the Company all of
the
rights of the Purchaser under the Purchase Agreement with respect to the
Assigned Loans.
3.
Company
warrants and represents to, and covenant with, Assignor and Assignee as
of the
date hereof:
(a) Attached
hereto as Attachment 2 is a true and accurate copy of the Purchase Agreement,
which agreement is in full force and effect as of the date hereof and the
provisions of which have not been waived, amended or modified in any respect,
nor has any notice of termination been given thereunder;
(b) Company
is duly organized, validly existing and in good standing under the laws
of the
jurisdiction of its incorporation, and has all requisite power and authority
to
service the Assigned Loans and otherwise to perform its obligations under
the
Purchase Agreement;
(c) Company
has full corporate power and authority to execute, deliver and perform
its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this
AAR
Agreement is in the ordinary course of Company’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Company’s charter or by-laws or any legal restriction, or any material agreement
or instrument to which Company is now a party or by which it is bound,
or result
in the violation of any law, rule, regulation, order, judgment or decree
to
which Company or its property is subject. The execution, delivery and
performance by Company of this AAR Agreement and the consummation by it
of the
transactions contemplated hereby, have been duly authorized by all necessary
corporate action on the part of Company. This AAR Agreement has been duly
executed and delivered by Company, and, upon the due authorization, execution
and delivery by Assignor and Assignee, will constitute the valid and legally
binding obligation of Company, enforceable against Company in accordance
with
its terms except as enforceability may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws now or hereafter in effect
relating
to creditors’ rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(d) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignee in connection with the execution, delivery or performance by Company
of
this AAR Agreement, or the consummation by it of the transactions contemplated
hereby;
(e) The
Company shall establish a Custodial Account and an Escrow Account under
the
Purchase Agreement in favor of the Assignee with respect to the Assigned
Loans
separate from the Custodial Account and Escrow Account previously established
under the Purchase Agreement in favor of Assignor;
(f) No
event
has occurred from the Closing Date to the date hereof which would render
the
representations and warranties as to the related Assigned Loans made by
the
Company in Sections 3.01 and 3.02 of the Purchase Agreement to be untrue
in any
material respect; and
(g) Neither
this AAR Agreement nor any certification, statement, report or other agreement,
document or instrument furnished or to be furnished by the Company pursuant
to
this AAR Agreement contains or will contain any materially untrue statement
of
fact or omits or will omit to state a fact necessary to make the statements
contained therein not misleading.
4.
Assignor
hereby agrees to indemnify and hold the Assignee (and its successors and
assigns) harmless against any and all claims, losses, penalties, fines,
forfeitures, legal fees and related costs, judgments, and any other costs,
fees
and expenses that Assignee (and its successors and assigns) may sustain
in any
way related to any breach of the representations or warranties of Assignor
set
forth in this AAR Agreement or the breach of any covenant or condition
contained
herein.
Recognition
of Assignee
5.
From
and
after the date hereof, Company shall recognize Assignee as owner of the
Assigned
Loans, and acknowledges that the Assigned Loans will be part of a REMIC,
and
will service the Assigned Loans in accordance with the Purchase Agreement
(as
modified by this AAR Agreement) but in no event in a manner that would
(i) cause
any REMIC to fail to qualify as a REMIC or (ii) result in the imposition
of a
tax upon any REMIC (including but not limited to the tax on prohibited
transactions as defined in Section 860F(a)(2) of the Code and the tax on
contributions to a REMIC set forth in Section 860G(d) of the Code). It
is the
intention of Assignor, Company and Assignee that this AAR Agreement shall
be
binding upon and for the benefit of the respective successors and assigns
of the
parties hereto. Neither Company nor Assignor shall amend or agree to amend,
modify, waive, or otherwise alter any of the terms or provisions of the
Purchase
Agreement which amendment, modification, waiver or other alteration would
in any
way affect the Assigned Loans without the prior written consent of
Assignee.
6.
It
is
expressly understood and agreed by the parties hereto that insofar as this
AAR
Agreement is executed on behalf of the Assignee (i) this AAR Agreement
is
executed and delivered by Citibank, N.A., not in its individual capacity
but
solely as trustee under the Pooling and Servicing Agreement, dated as of
August
1, 2006 (the “Pooling and Servicing Agreement”), among the Assignor, Bear
Xxxxxxx Asset Backed Securities I LLC, Citibank, N.A., as trustee and LaSalle
Bank National Association as securities administrator and master servicer,
in
the exercise of the powers and authority conferred and vested in it, (ii)
each
of the representations, undertakings and agreements herein made on the
part of
the Assignee is made and intended not as representations, warranties, covenants,
undertakings and agreements by Citibank, N.A. in its individual capacity,
but is
made and intended for the purpose of binding only the Assignee, (iii) under
no
circumstances shall Citibank, N.A. in its individual capacity be personally
liable for the payment of any indebtedness or expenses of the Assignee
or be
liable for the breach or failure of any obligation, representation, warranty
or
covenant made or undertaken by the Assignee under this AAR Agreement and
(iv)
any recourse against the Assignee in respect of any obligations it may
have
under or pursuant to the terms of this AAR Agreement shall be limited solely
to
the assets it may hold as trustee of SACO I Trust 2006-9.
Company
shall indemnify and hold harmless the Assignor, each affiliate of the Assignor,
Bear Xxxxxxx Asset Backed Securities I LLC (“BSABS I”), the Assignee, Bear,
Xxxxxxx & Co. Inc. (the “Underwriter”) and each affiliate of the
Underwriter, each Person (including, but not limited to, the Master Servicer)
responsible for the preparation, execution or filing of any report required to
be filed with the Commission, or for execution of a certification pursuant
to
Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act, each Person who
controls the Assignor, BSABS I, the Assignee or the Underwriter (within
the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange
Act);
and the respective present and former directors, officers, employees, agents
and
affiliates of each of the foregoing (each, an “Indemnified Party”), and shall
hold each of them harmless from and against any claims, losses, damages,
penalties, fines, forfeitures, legal fees and expenses and related costs,
judgments, and any other costs, fees and expenses that any of them may
sustain
arising out of or based upon:
| (i) |
(A)any
untrue statement of a material fact contained or alleged to be
contained
in any information, report, certification, data, accountants’ letter or
other material provided under Section 11.18 of the Servicing
Agreement by
or on behalf of the Assignor, or provided under Section 11.18
of the
Servicing Agreement by or on behalf of any Subservicer, Subcontractor
or
Third-Party Originator (collectively, the “Company Information”), or (B)
the omission or alleged omission to state in the Company Information
a
material fact required to be stated in the Company 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
Company Information and not to any other information communicated
in
connection with a sale or purchase of securities, without regard
to
whether the Company Information or any portion thereof is presented
together with or separately from such other
information;
|
| (ii) |
any
breach by the Company of its obligations under Section 11.18
of Servicing
Agreement, including particularly any failure by the Company,
any
Subservicer, any Subcontractor or any Third-Party Originator
to deliver
any information, report, certification, accountants’ letter or other
material when and as required under Section 11.18 of the Servicing
Agreement, including any failure by the Company to identify any
Subcontractor “participating in the servicing function” within the meaning
of Item 1122 of Regulation AB;
|
| (iii) |
any
breach by the Company of a representation or warranty set forth
in Section
3.01 of the Servicing Agreement or in a writing furnished pursuant
to
Section 3.01 of the Servicing Agreement and made as of a date
prior to the
date hereof, to the extent that such breach is not cured by the
date
hereof, or any breach by the Company of a representation or warranty
in a
writing furnished pursuant to Section 3.01 of the Servicing Agreement
to
the extent made as of a date subsequent to the date hereof;
or
|
| (iv) |
the
negligence, bad faith or willful misconduct of the Company in
connection
with its performance under Section 11.18 of the Servicing
Agreement.
|
If
the
indemnification provided for herein is unavailable or insufficient to hold
harmless an Indemnified Party, then the Company agrees that it shall contribute
to the amount paid or payable by such Indemnified Party as a result of
any
claims, losses, damages or liabilities incurred by such Indemnified Party
in
such proportion as is appropriate to reflect the relative fault of such
Indemnified Party on the one hand and the Company on the other.
In
the
case of any failure of performance described in Section 11.18 of the Servicing
Agreement, the Company shall promptly reimburse the Underwriter, BSABS
I and
each Person responsible for the preparation, execution or filing of any
report
required to be filed with the Commission, or for execution of a certification
pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act, 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 Company, any Subservicer, any Subcontractor or any Third-Party
Originator.
Modification
of Purchase Agreement
7.
The
Company and Assignor hereby amend the Purchase Agreement as
follows:
(a) The
following definitions are added to Article I of the Purchase
Agreement:
Assignee:
Citibank,
N.A.,
as
trustee for the holders of the SACO I Trust 2006-9.
Master
Servicer:
LaSalle
Bank National Association, or its successors in interest who meet the
qualifications of the Pooling and Servicing Agreement and this
Agreement.
Pooling
and Servicing Agreement:
That
certain pooling and servicing agreement, dated as of August 1, 2006, among
Bear
Xxxxxxx Asset Backed Securities I LLC, the Trustee, the Master Servicer,
the
Securities Administrator and the Purchaser.
Securities
Administrator:
LaSalle
Bank National Association, or its successors in interest who meet the
qualifications of the Pooling and Servicing Agreement and this
Agreement.
Trustee:
Citibank,
N.A.,
or its
successor in interest, or any successor trustee appointed as provided in
the
Pooling and Servicing Agreement.
(b) The
definition of Business Day is deleted in its entirety and replaced with
the
following:
Business
Day:
Any day
other than: (i) a Saturday or Sunday, or (ii) a legal holiday in the States
of
New York, Illinois, Maryland, Minnesota or Texas, or (iii) a day on which
banks
in the States of New York, Maryland, Illinois, Minnesota or Texas are authorized
or obligated by law or executive order to be closed.
(c) The
third
paragraph of Section 4.01 of the Purchase Agreement shall be deleted in
its
entirety and replaced with the following:
Notwithstanding
anything to the contrary contained in this Agreement, the Company shall
not make
or permit any modification, waiver or amendment of any term of any Mortgage
Loan
that would (i) effect an exchange or reissuance of such Mortgage Loan under
Section 1001 of the Code (or Treasury regulations promulgated thereunder)
and
(ii) cause any REMIC created under the trust agreement pursuant to any
Reconstitution to fail to qualify as a REMIC or result in the imposition
of any
tax under Section 860F(a) of Section 860G(d) of the Code.
(d) The
last
paragraph in Section 4.02 of the Agreement is deleted and replaced with
the
following:
The
Company shall not waive any prepayment penalty unless: (i) the enforceability
thereof shall have been limited by bankruptcy, insolvency, moratorium,
receivership and other similar laws relating to creditors’ rights generally,
(ii) the enforcement thereof is illegal, or any local, state or federal
agency
has threatened legal action if the prepayment penalty is enforced, (iii)
the
mortgage debt has been accelerated in connection with a foreclosure or
other
involuntary payment or (iv) such waiver is standard and customary in servicing
similar Mortgage Loans and relates to a default or a reasonably foreseeable
default and would, in the reasonable judgment of the Company, maximize
recovery
of total proceeds taking into account the value of such prepayment penalty
and
the related Mortgage Loan. If a prepayment penalty is waived, but does
not meet
the standards described above, then the Company is required to pay the
amount of
such waived prepayment penalty by remitting such amount to the Master Servicer
by the Remittance Date.
(e) The
following shall be added at the end of the last paragraph of Section 4.03
of the
Purchase Agreement:
In
the
event a Mortgage Loan is charged-off, the Mortgage Loan will be removed
from the
pool and remittances with regard to such Mortgage Loan will occur on an
actual/actual basis in the following method: no later than on each Remittance
Date, the Company 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 not 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 to the Purchaser as follows: (i) all
collections of principal (ii) all collections of interest net of servicing
fees
(iii) liquidation proceeds net of the Company’s servicing advances. In addition,
any prepayment in full shall be remitted to the Purchaser within five (5)
business days of collection.
(f) The
second paragraph of Section 4.13 of the Purchase Agreement is deleted in
its
entirety and replaced with the following:
The
Company shall notify the Assignor in accordance with the Xxxxxx Mae Guides
of
each acquisition of REO Property upon such acquisition (and, in any event,
shall
provide notice of the consummation of any foreclosure sale within three
(3)
Business Days of the date Company receives notice of such consummation),
together with a copy of the drive by appraisal or brokers price opinion
of the
Mortgaged Property obtained in connection with such acquisition. Thereafter,
the
Assignor shall assume the marketing and administration of such REO Property
and
shall sell such REO Property as expeditiously as possible and in accordance
with
the provisions of the Pooling and Servicing Agreement, as if such Mortgage
Loan
were an EMC Mortgage Loan. Pursuant to its efforts to sell such REO Property,
the Assignor shall protect and conserve such REO Property in the manner
and to
the extent required by the Pooling and Servicing Agreement. No Servicing
Fee
shall be assessed or otherwise accrue on any REO Property from and after
the
date on which it becomes an REO Property.
(g) The
phrase “without giving effect to principles of conflicts of laws and” shall be
added following the phrase “the State of New York” in Section 11.04 of the
Purchase Agreement.
(h) The
following shall be added as Section 11.21 of the Purchase
Agreement:
Section
11.21 Third
Party Beneficiary.
For
purposes of this Agreement, any Master Servicer shall be considered a third
party beneficiary to this Agreement entitled to all the rights and benefits
accruing to any Master Servicer herein as if it were a direct party to
this
Agreement.
Miscellaneous
8.
All
demands, notices and communications related to the Assigned Loans, the
Purchase
Agreement and this AAR Agreement shall be in writing and shall be deemed
to have
been duly given if personally delivered at or mailed by registered mail,
postage
prepaid, as follows:
| (a) |
In
the case of Company:
|
First
Tennessee Mortgage Services, Inc.
0000
Xxxxxxx Xxx
Xxxxxx,
Xxxxx 00000
Attention:
Capital Markets Department
| (b) |
In
the case of Assignor:
|
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
Xxxxx 7506
Attention:
President or General Counsel
Facsimile:
(000) 000-0000
with
a
copy to:
Bear
Xxxxxxx Mortgage Capital Corporation
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxxxxx Xxxxx
Telecopier
No.: (000) 000-0000
| (c) |
In
the case of Assignee:
|
Citibank,
N.A., as Trustee
000
Xxxxxxxxx Xxxxxx, 00xx
Xxxxx
Xxx
Xxxx,
Xxx
Xxxx 00000
Attention:
SACO 2006-9
Telecopier
No.: (000) 000-0000
9.
The
Company hereby acknowledges that LaSalle Bank National Association (the
“Master
Servicer”) has been appointed as the master servicer of the Assigned Loans
pursuant to the Pooling and Servicing Agreement, and therefor has the right
to
enforce all obligations of the Company, as they relate to the Assigned
Loans,
under the Purchase Agreement. Such right will include, without limitation,
the
right to terminate the Company under the Purchase Agreement upon the occurrence
of an event of default thereunder, the right to receive all remittances
required
to be made by the Company under the Purchase Agreement, the right to receive
all
monthly reports and other data required to be delivered by the Company
under the
Purchase Agreement, the right to examine the books and records of the Company,
indemnification rights, and the right to exercise certain rights of consent
and
approval relating to actions taken by the Company. The Company shall make
all
distributions under the Purchase Agreement, as they relate to the Assigned
Loans, to the Master Servicer by wire transfer of immediately available
funds
to:
LaSalle
Bank National Association
ABA#
000000000
Account
#
[____________]
Attn:
Xxxxxx Xxxxxx
and
the
Company shall deliver all reports required to be delivered under the Purchase
Agreement, as they relate to the Assigned Loans, to the Assignee at the
address
set forth in Section 8 herein and to the Master Servicer at:
LaSalle
Bank National Association
000
X.
XxXxxxx Xx., Xxxxx 0000
Xxxxxxx,
XX 00000
Attention:
Global Securities and Trust Services Group- SACO 2006-9
10.
Each
party will pay any commissions it has incurred and the fees of its attorneys
in
connection with the negotiations for, documenting of and closing of the
transactions contemplated by this AAR Agreement.
11.
This
AAR
Agreement shall be construed in accordance with the laws of the State of
New
York, without regard to conflicts of law principles, and the obligations,
rights
and remedies of the parties hereunder shall be determined in accordance
with
such laws.
12.
No
term
or provision of this AAR Agreement may be waived or modified unless such
waiver
or modification is in writing and signed by the party against whom such
waiver
or modification is sought to be enforced.
13.
This
AAR
Agreement shall inure to the benefit of the successors and assigns of the
parties hereto. Any entity into which Assignor, Assignee or Company may
be
merged or consolidated shall, without the requirement for any further writing,
be deemed Assignor, Assignee or Company, respectively, hereunder.
14.
This
AAR
Agreement shall survive the conveyance of the Assigned Loans, the assignment
of
the Purchase Agreement to the extent of the Assigned Loans by Assignor
to
Assignee and the termination of the Purchase Agreement.
15.
This
AAR
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.
16.
In
the
event that any provision of this AAR Agreement conflicts with any provision
of
the Purchase Agreement with respect to the Assigned Loans, the terms of
this AAR
Agreement shall control.
IN
WITNESS WHEREOF, the parties hereto have executed this AAR Agreement as
of the
day and year first above written.
EMC
MORTGAGE CORPORATION
Assignor
By:_______________________
Name:_____________________
Title:______________________
CITIBANK,
N.A., not individually but solely as Trustee for the SACO I Trust 2006-9,
Mortgage Pass-Through Certificates, Series 2006-9
Assignee
By:_______________________
Name:_____________________
Title:______________________
FIRST
TENNESSEE MORTGAGE SERVICES, INC.
Company
By:_______________________
Name:_____________________
Title:______________________
Acknowledged
and Agreed:
LASALLE
BANK NATIONAL ASSOCIATION
Master
Servicer
By:_______________________
Name:_____________________
Title:______________________
ATTACHMENT
1
ASSIGNED
LOAN SCHEDULE
(Available
upon request)
ATTACHMENT
2
PURCHASE
AGREEMENT
EXHIBIT
S-1
FORM
OF
GMACM SERVICING AGREEMENT
____________________________________________________________________________________
EMC
MORTGAGE CORPORATION
Owner
GMAC
MORTGAGE CORPORATION
Servicer
SERVICING
AGREEMENT
Dated
as
of May 1, 2001
____________________________________________________________________________________
EXHIBITS
Exhibit
A Mortgage
Loan Schedule
Exhibit
B Custodial
Account Letter Agreement
Exhibit
C Escrow
Account Letter Agreement
Exhibit
D Form
of
Request for Release
Exhibit
E Loan
Level Scheduled-Scheduled Remittance Tape Layout
THIS
IS A
SERVICING AGREEMENT, dated as of May 1, 2001, and is executed between EMC
Mortgage Corporation (the "Owner") and GMAC Mortgage Corporation (the
"Servicer").
W
I T N E
S S E T H :
WHEREAS,
the Owner is the owner of the Mortgage Loans;
WHEREAS,
the Owner and the Servicer wish to prescribe the permanent management,
servicing
and control of the Mortgage Loans;
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of
which is
hereby acknowledged, the Owner and the Servicer agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.01 Defined
Terms
Whenever
used in this Agreement, the following words and phrases, unless the context
otherwise requires, shall have the following meaning specified in this
Article:
Accepted
Servicing Practices:
With
respect to any Mortgage Loan, those mortgage servicing practices (including
collection procedures) that are in accordance with the Xxxxxx Xxx
Guide.
Adjustment
Date:
As to
each ARM Loan, the date on which the Mortgage Interest Rate is adjusted
in
accordance with the terms of the related Mortgage Note.
Agreement:
This
Servicing Agreement including all exhibits hereto, amendments hereof and
supplements hereto.
ARM
Loans:
First
lien, conventional, 1-4 family residential Mortgage Loans with interest
rates
which adjust from time to time in accordance with the related Index and
are
subject to Periodic Rate Caps and Lifetime Rate Caps and which do not permit
conversion to fixed interest rates.
BIF:
The
Bank Insurance Fund, or any successor thereto.
Business
Day:
Any day
other than (i) a Saturday or Sunday, or (ii) a legal holiday in the States
of
New York, Iowa or the Commonwealth of Pennsylvania, or (iii) a day on which
banks in the States of New York, Iowa or Pennsylvania are authorized or
obligated by law or executive order to be closed.
Code:
The
Internal Revenue Code of 1986, as it may be amended from time to time,
or any
successor statute thereto, and applicable U.S. Department of the Treasury
regulations issued pursuant thereto.
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.
Custodial
Account:
The
separate demand account or accounts created and maintained pursuant to
Section
4.04 which shall be entitled "GMAC Mortgage Corporation Custodial Account
in
trust for [Owner], Owner of Whole Loan Mortgages and various Mortgagors"
and
shall be established at a Qualified Depository, each of which accounts
shall in
no event contain funds in excess of the FDIC insurance limits.
Custodian:
Xxxxx
Fargo Bank Minnesota, N.A., or such other custodian as Owner shall
designate.
Cut-off
Date:
As
identified on the related Confirmation.
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 Remittance
Date.
Due
Date:
Each
day on which payments of principal and interest are required to be paid
in
accordance with the terms of the related Mortgage Note, exclusive of any
days of
grace.
Due
Period:
With
respect to any Remittance Date, the period commencing on the second day
of the
month preceding the month of such Remittance Date and ending on the first
day of
the month of the Remittance Date.
Effective
Date:
As
identified on the related Confirmation.
Escrow
Account:
The
separate trust account or accounts created and maintained pursuant to Section
4.06 which shall be entitled "GMAC Mortgage Corporation Escrow Account,
in trust
for [Owner], Owner of Whole Loan Mortgages and various Mortgagors" and
shall be
established at a Qualified Depository, each of which accounts shall in
no event
contain funds in excess of the FDIC insurance limits.
Escrow
Payments:
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 9.01.
Xxxxxx
Xxx:
Xxxxxx
Xxx, or any successor thereto.
Xxxxxx
Mae Guide:
The
Xxxxxx Xxx Selling Guide and the Xxxxxx Mae Servicing Guide and all amendments
or additions thereto.
FDIC:
The
Federal Deposit Insurance Corporation, or any successor thereto.
Fidelity
Bond:
A
fidelity bond to be maintained by the Servicer pursuant to Section
4.12.
FIRREA:
The
Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as
amended
from time to time.
Xxxxxxx
Mac:
Xxxxxxx
Mac, or any successor thereto.
Xxxxxxx
Mac Guide:
The
Xxxxxxx Mac Selling Guide and the Xxxxxxx Mac Servicing Guide and all amendments
or additions thereto.
Full
Principal Prepayment:
A
Principal Prepayment made by a Mortgagor of the entire principal balance
of a
Mortgage Loan.
|
GAAP:
Generally accepted accounting procedures, consistently
applied.
|
HUD:
The
United States Department of Housing and Urban Development or any
successor.
Index:
With
respect to each ARM Loan, on the related Adjustment Date, the index used
to
determine the Mortgage Interest Rate on each such ARM Loan.
Insurance
Proceeds:
With
respect to each Mortgage Loan, proceeds of insurance policies insuring
the
Mortgage Loan or the related Mortgaged Property.
Lifetime
Rate Cap:
With
respect to each ARM Loan, the maximum Mortgage Interest Rate over the term
of
such Mortgage Loan, as specified in the related Mortgage Note.
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, other than amounts received following the
acquisition of an REO Property pursuant to Section 4.13.
Margin:
With
respect to each ARM Loan, the fixed percentage amount set forth in each
related
Mortgage Note which is added to the Index in order to determine the related
Mortgage Interest Rate.
Monthly
Advance:
The
aggregate of the advances made by the Servicer on any Remittance Date pursuant
to Section 5.03.
Monthly
Payment:
With
respect to each Mortgage Loan, the scheduled monthly payment of principal
and
interest thereon which is payable by the related Mortgagor under the related
Mortgage Note.
Mortgage:
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.
Mortgage
Interest Rate:
The
annual rate at which interest accrues on any Mortgage Loan in accordance
with
the provisions of the related Mortgage Note, and in the case of an ARM
Loan, as
adjusted from time to time on each Adjustment Date for such Mortgage Loan
to
equal the Index for such Mortgage Loan plus the Margin for such Mortgage
Loan,
and subject to the limitations on such interest rate imposed by the Periodic
Rate Cap and the Lifetime Rate Cap.
Mortgage
Loan:
An
individual Mortgage Loan described herein, and as further identified on
the
Mortgage Loan Schedule, which Mortgage Loan includes without limitation
the
Mortgage Loan Documents, the Monthly Payments, Principal Prepayments,
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, REO Disposition
Proceeds, and all other rights, benefits, proceeds and obligations arising
from
or in connection with such Mortgage Loan.
Mortgage
Loan Documents:
The
original mortgage loan legal documents held by the Custodian.
Mortgage
Loan Remittance Rate:
With
respect to each Mortgage Loan, the annual rate of interest remitted to
the
Owner, which shall be equal to the related Mortgage Interest Rate minus
the
Servicing Fee Rate.
Mortgage
Loan Schedule:
The
schedule of Mortgage Loans attached hereto as Exhibit
A,
such
schedule being acceptable to the Owner and the Servicer.
Mortgage
Note:
The
note or other evidence of the indebtedness of a Mortgagor secured by a
Mortgage.
Mortgaged
Property:
The
underlying real property securing repayment of a Mortgage Note, consisting
of a
single parcel of real estate considered to be real estate under the laws
of the
State in which such real property is located, which may include condominium
units and planned unit developments, improved by a residential
dwelling.
Mortgagor:
The
obligor on a Mortgage Note. The Mortgagor is a natural person who is a
party to
the Mortgage Note and Mortgage in an individual capacity.
Nonrecoverable
Advance:
Any
advance previously made by the Servicer pursuant to Section 5.03 or any
expenses
incurred pursuant to Section 4.08 which, in the good faith judgment of
the
Servicer, may not be ultimately recoverable by the Servicer from Liquidation
Proceeds. The determination by the Servicer that is has made a Nonrecoverable
Advance, shall be evidenced by an Officer’s Certificate of the Servicer
delivered to the Owner and detailing the reasons for such
determination.
OCC:
Office
of the Comptroller of the Currency, its successors and assigns.
Officers'
Certificate:
A
certificate signed by the Chairman of the Board, the Vice Chairman of the
Board,
the President, a Senior Vice President or a Vice President or by the Treasurer
or the Secretary or one of the Assistant Treasurers or Assistant Secretaries
of
the Servicer, and delivered to the Owner as required by this
Agreement.
Opinion
of Counsel:
A
written opinion of counsel, who may be an employee of the party on behalf
of
whom the opinion is being given, reasonably acceptable to the
Owner.
OTS:
Office
of Thrift Supervision, its successors and assigns.
Owner:
EMC
Mortgage Corporation, its successors in interest and assigns.
Partial
Principal Prepayment:
A
Principal Prepayment by a Mortgagor of a partial principal balance of a
Mortgage
Loan.
Pass-Through
Transfer:
The
sale or transfer of same or all of the Mortgage Loans to a trust as part
of a
publicly issued or privately placed, rated or unrated Mortgage pass-through
transaction.
Periodic
Rate Cap:
With
respect to each ARM Loan, the maximum increase or decrease in the Mortgage
Interest Rate on any Adjustment Date.
Permitted
Investments:
Any one
or more of the following obligations or securities:
(i) direct
obligations of, and obligations fully guaranteed by the United States of
America
or any agency or instrumentality of the United States of America the obligations
of which are backed by the full faith and credit of the United States of
America; pro-vided that obligations of Xxxxxxx Mac or Xxxxxx Mae shall
be
Per-mitted Invest-ments only if, at the time of investment, they are rated
in
one of the two highest rating categories by Standard & Poor's Rating
Services, a division of The XxXxxx-Xxxx Companies Inc., Xxxxx'x Investors
Service, Inc. and Fitch IBCA Inc.;
(ii) (a)
demand or time deposits, federal funds or bankers' acceptances issued by
any
depository institu-tion or trust company incorporated under the laws of
the
United States of America or any state thereof and subject to supervision
and
examination by federal and/or state banking authorities, provided that
the
commercial paper and/or the short-term deposit rating and/or the long-term
unsecured debt obligations or deposits of such depository institution or
trust
company at the time of such investment or contractual commitment providing
for
such investment are rated in one of the two highest rating categories by
Standard & Poor's Rating Services, a division of The XxXxxx-Xxxx Companies
Inc., Xxxxx'x Investors Service, Inc. and Fitch IBCA Inc. and (b) any other
demand or time deposit or certificate of deposit that is fully insured
by the
Federal Deposit Insurance Cor-poration;
(iii) repurchase
obligations with respect to (a) any security described in clause (i) above
or
(b) any other security issued or guaranteed by an agency or instrumen-tality
of
the United States of America, the obligations of which are backed by the
full
faith and credit of the United States of America, in either case entered
into
with a depository institution or trust company (acting as principal) described
in clause (ii)(a) above;
(iv) securities
bearing interest or sold at a discount issued by any corporation incorporated
under the laws of the United States of America or any state thereof that
are
rated in one of the two highest rating categories by Standard & Poor's
Rating Services, a division of The XxXxxx-Xxxx Companies Inc., Xxxxx'x
Investors
Service, Inc. and Fitch IBCA Inc. at the time of such in-vestment or contractual
commitment providing for such investment; provided,
however,
that
securities issued by any particular corporation will not be Permitted
Investments to the extent that investments therein will cause the then
outstanding principal amount of secur-ities issued by such corporation
and held
as Permitted Investments to exceed 10% of the aggregate outstand-ing principal
balances and amounts of all the Permitted Investments;
(v) commercial
paper (including both non-interest-bearing discount obligations and
interest-bearing obliga-tions payable on demand or on a specified date
not more
than one year after the date of issuance there-of) which are rated in one
of the
two highest rating categories by Standard & Poor's Rating Services, a
division of The XxXxxx-Xxxx Companies Inc., Xxxxx'x Investors Service,
Inc. and
Fitch IBCA Inc. at the time of such investment;
(vi) any
other
demand, money market or time deposit, obligation, security or investment
as may
be acceptable to each of Standard & Poor's Rating Services, a division of
The XxXxxx-Xxxx Companies, Inc., Xxxxx'x Investors Service, Inc. and Fitch
IBCA
Inc.;
(vii) any
money
market funds the collateral of which consists of obligations fully guaranteed
by
the United States of America or any agency or instru-ment-al-ity of the
United
States of America the obligations of which are backed by the full faith
and
credit of the United States of America (which may include repurchase obligations
secured by collateral described in clause (i)) and other securities and
which
money market funds are rated in one of the two highest rating categories
by
Standard & Poor's Rating Services, a division of The XxXxxx-Xxxx Companies
Inc., Xxxxx'x Investors Service, Inc. and Fitch IBCA Inc.; and
(viii) GMAC
Variable Denomination Adjustable Rate Demand Notes constituting unsecured,
senior debt obligations of General Motors Acceptance Corporation as outlined
in
the prospectus dated June 17, 1998 and rated by Moody’s in its highest
short-term rating category available and rated at least D-1 by
Fitch;
provided,
however,
that no
instrument or security shall be a Permitted Investment if such instrument
or
security evidences a right to receive only interest payments with respect
to the
ob-li-ga-tions underlying such instrument or if such security provides
for
payment of both principal and interest with a yield to matur-ity in excess
of
120% of the yield to maturity at par.
Person:
Any
individual, corporation, partnership, joint venture, association, joint-stock
company, limited liability company, trust, unincorporated organization
or
government or any agency or political subdivision thereof.
Prepayment
Interest Shortfall:
The sum
of the differences between interest actually received in a Due Period as
a
result of a full or partial prepayment or other unscheduled receipt of
principal
(including as a result of a liquidation) on each Mortgage Loan as to which
such
a payment is received and the interest portion of the Monthly Payment of
such
Mortgage Loan scheduled to be due at the applicable Mortgage Loan Remittance
Rate; provided, however, Prepayment Interest Shortfalls shall not include
Full
Principal Prepayments received on or before the 15th
day of
the month in which a Remittance Date occurs which are remitted by the Servicer
to the Owner on such Remittance Date.
Primary
Mortgage Insurance Policy:
Each
primary policy of mortgage insurance, or any replacement policy therefor
obtained by the Servicer pursuant to Section 4.08.
Prime
Rate:
The
prime rate of U.S. money center banks as published from time to time in
The
Wall Street Journal.
Principal
Prepayment:
Any
payment or other recovery of principal on a Mortgage Loan, full or partial,
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.
Qualified
Appraiser:
An
appraiser, duly appointed by the Servicer, who had no interest, direct
or
indirect in the Mortgaged Property or in any loan made on the security
thereof,
and whose compensation is not affected by the approval or disapproval of
the
Mortgage Loan, which appraiser and the appraisal made by such appraiser
both
satisfy the requirements of Title XI of FIRREA and the regulations promulgated
thereunder, all as in effect on the date the Mortgage Loan was
originated.
Qualified
Depository:
(a) The
Custodian or (b) a depository, the accounts of which are insured by the
FDIC
through the BIF or the SAIF and the short term debt ratings and the long
term
deposit ratings of which are rated in one of the two highest rating categories
by Standard & Poor's Ratings Services, a division of The XxXxxx-Xxxx
Companies Inc., Xxxxx'x Investors Service, Inc., Fitch IBCA Duff &
Xxxxxx.
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.
REMIC:
A “real
estate mortgage
investment conduit” within the meaning of Section 860D of the Code.
REMIC
Provisions:
The
provisions of the Federal income tax law relating to a REMIC, which appear
at
Section 860A through 860G of Subchapter M of Chapter 1, Subtitle A of the
Code,
and related provisions, and regulations, rulings or pronouncements promulgated
thereunder, as the foregoing may be in effect from time to time.
Remittance
Date:
The
18th day of any month, or if such 18th day is not a Business Day, the first
Business Day immediately preceding such 18th day.
REO
Disposition:
The
final sale by the Servicer of any REO Property.
REO
Disposition Proceeds:
Amounts
received by the Servicer in connection with a related REO
Disposition.
REO
Property:
A
Mortgaged Property acquired by the Servicer on behalf of the Owner as described
in Section 4.13.
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SAIF:
The Savings Association Insurance Fund, or any successor
thereto.
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Servicer:
GMAC
Mortgage Corporation, or any of its successors in interest or any successor
under this Agreement appointed as herein provided.
Servicing
Advances:
All
customary, reasonable and necessary "out of pocket" costs and expenses
(including reasonable attorneys' fees and disbursements) incurred prior
to, on
and subsequent to the Effective Date in the performance by the Servicer
of its
servicing obligations relating to each Mortgage Loan, 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, elections, 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
full or partial 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 Primary Mortgage Insurance Policy premiums and
fire and
hazard insurance coverage and (e) compliance with the obligations under
Section
4.08.
Servicing
Fee:
With
respect to each Mortgage Loan, the amount of the annual fee the Owner shall
pay
to the Servicer, which shall, for a period of one full month, be equal
to
one--twelfth of the product of (a) the applicable Servicing Fee Rate and
(b) the
outstanding principal balance of such Mortgage Loan. Such fee shall be
payable
monthly, computed on the basis of the same principal amount and period
respecting which any related interest payment on a Mortgage Loan is computed.
The obligation of the Owner to pay the Servicing Fee is limited to, and
the
Servicing Fee is payable solely from, the interest portion (not including
recoveries of interest from Liquidation Proceeds or otherwise) of such
Monthly
Payment collected by the Servicer, or as otherwise provided under Section
4.05.
Servicing
Fee Rate:
The
Servicing Fee Rate shall be a rate per annum equal to 0.25%.
Servicing
File:
The
documents, records and other items pertaining to a particular Mortgage
Loan, and
any additional documents relating to such Mortgage Loan as are in, or as
may
from time to time come into, the Servicer's possession.
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 Owner upon request, as such list
may
from time to time be amended.
Stated
Principal Balance:
As to
each Mortgage Loan as of any date of determination, (i) the principal balance
of
such Mortgage Loan after giving effect to payments of principal due, whether
or
not received, minus (ii) all amounts previously distributed to the Owner
with
respect to the Mortgage Loan representing payments or recoveries of principal
or
advances in lieu thereof.
Whole
Loan Transfer:
The
sale or transfer of some or all of the ownership interest in the Mortgage
Loans
by the Owner to one or more third parties in whole loan or participation
format,
which third party may be Xxxxxx Mae or Xxxxxxx Mac.
ARTICLE
II
SERVICING
OF MORTGAGE LOANS;
POSSESSION
OF SERVICING FILES;
BOOKS
AND RECORDS;
DELIVERY
OF MORTGAGE LOAN DOCUMENTS
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Section
2.01 Servicing
of Mortgage Loans.
|
From
and
after the Effective Date, the Servicer does hereby agree to service the
Mortgage
Loans, but subject to the terms of this Agreement. The rights of the Owner
to
receive payments with respect to the Mortgage Loans shall be as set forth
in
this Agreement.
Section
2.02 Maintenance
of Servicing Files.
The
Servicer shall maintain a Servicing File consisting of all documents necessary
to service the Mortgage Loans. The possession of each Servicing File by
the
Servicer is for the sole purpose of servicing the Mortgage Loan, and such
retention and possession by the Servicer is in a custodial capacity only.
The
Servicer acknowledges that the ownership of each Mortgage Loan, including
the
Note, the Mortgage, all other Mortgage Loan Documents and all rights, benefits,
proceeds and obligations arising therefrom or in connection therewith,
has been
vested in the Owner. All rights arising out of the Mortgage Loans including,
but
not limited to, all funds received on or in connection with the Mortgage
Loans
and all records or documents with respect to the Mortgage Loans prepared
by or
which come into the possession of the Servicer shall be received and held
by the
Servicer in trust for the exclusive benefit of the Owner as the owner of
the
related Mortgage Loans. Any portion of the related Servicing Files retained
by
the Servicer shall be appropriately identified in the Servicer's computer
system
to clearly reflect the ownership of the related Mortgage Loans by the Owner.
The
Servicer shall release its custody of the contents of the related Servicing
Files only in accordance with written instructions of the Owner, except
when
such release is required as incidental to the Servicer's servicing of the
Mortgage Loans, such written instructions shall not be required.
Section
2.03 Books
and Records.
The
Servicer shall be responsible for maintaining, and shall maintain, a complete
set of books and records for the Mortgage Loans which shall be appropriately
identified in the Servicer's computer system to clearly reflect the ownership
of
the Mortgage Loan by the Owner. In particular, the Servicer shall maintain
in
its possession, available for inspection by the Owner, or its designee
and shall
deliver to the Owner upon demand, evidence of compliance with all federal,
state
and local laws, rules and regulations, and requirements of Xxxxxx Mae or
Xxxxxxx
Mac, as applicable, including but not limited to documentation as to the
method
used in determining the applicability of the provisions of the Flood Disaster
Protection Act of 1973, as amended, to the Mortgaged Property, documentation
evidencing insurance coverage and eligibility of any condominium project
for
approval by Xxxxxx Mae and periodic inspection reports as required by Section
4.13. To the extent that original documents are not required for purposes
of
realization of Liquidation Proceeds or Insurance Proceeds, documents maintained
by the Servicer may be in the form of microfilm or microfiche or such other
reliable means of recreating original documents, including but not limited
to,
optical imagery techniques so long as the Servicer complies with the
requirements of the Xxxxxx Xxx Guide.
The
Servicer shall maintain with respect to each Mortgage Loan and shall make
available for inspection by any Owner or its designee the related Servicing
File
(or copies thereof) upon reasonable request during the time the Owner retains
ownership of a Mortgage Loan and thereafter in accordance with applicable
laws
and regulations.
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Section
2.04. Transfer
of Mortgage Loans.
|
The
Servicer shall keep at its servicing office books and records in which,
subject
to such reasonable regulations as it may prescribe from time to time, 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 any Mortgage Loan unless
a
notice of the transfer of such Mortgage Loan has been delivered to the
Servicer
in accordance with this Section 2.04. The Owner may, subject to the terms
of
this Agreement, sell and transfer one or more of the Mortgage Loans in
accordance with Sections 10.02 and 11.12, provided,
however, that the transferee will not be deemed to be an Owner hereunder
binding
upon the Servicer unless such transferee shall agree in writing to be bound
by
the terms of this Agreement and an assignment and assumption of this Agreement
reasonably acceptable to the Servicer. The Owner also shall advise the
Servicer
in writing of the transfer. Upon receipt of notice of the permitted transfer,
the Servicer shall xxxx its books and records to reflect the ownership
of the
Mortgage Loans of such assignee, and shall release the previous Owner from
its
obligations hereunder with respect to the Mortgage Loans sold or
transferred.
Section
2.05 Delivery
of Mortgage Loan Documents.
The
Servicer shall forward to the Custodian on behalf of the Owner original
documents evidencing an assumption, modification, consolidation or extension
of
any Mortgage Loan entered into in accordance with Section 4.01 or 6.01
promptly
after their execution; provided, however, that the Servicer shall provide
the
Custodian on behalf of the Owner with a certified true copy of any such
document
submitted for recordation promptly after 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 180 days of its execution. If delivery is not
completed within 180 days solely due to delays in making such delivery
by reason
of the fact that such documents shall not have been returned by the appropriate
recording office, the Servicer shall continue to use its best efforts to
effect
delivery as soon as possible thereafter.
From
time
to time the Servicer may have a need for Mortgage Loan Documents to be
released
by the Custodian. If the Servicer shall require any of the Mortgage Loan
Documents, the Servicer shall notify the Custodian in writing of such request
in
the form of the request for release attached hereto as Exhibit
D.
The
Custodian shall deliver to the Servicer promptly, and in no event later
than
within five (5) Business Days, any requested Mortgage Loan Document previously
delivered to the Custodian, provided that such documentation is promptly
returned to the Custodian when the Servicer no longer requires possession
of the
document, and provided that during the time that any such documentation
is held
by the Servicer, such possession is in trust for the benefit of the
Owner.
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Section
2.06 Quality
Control Procedures.
|
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
must be
capable of evaluating and monitoring the overall quality of its servicing
activities. The purpose of the program is to ensure that the Mortgage Loans
are
serviced in accordance with prudent mortgage banking practices and accounting
principles; guard against dishonest, fraudulent, or negligent acts; and
guard
against errors and omissions by officers, employees, or other authorized
persons.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES
OF
THE
SERVICER
The
Servicer represents, warrants and covenants to the Owner that as of the
Effective Date or as of such date specifically provided herein:
(a) The
Servicer is a validly existing corporation in good standing under the laws
of
the State of its organization and is qualified to transact business in,
is in
good standing under the laws of, and possesses all licenses necessary for
the
conduct of its business in, each state in which any Mortgaged Property
is
located or is otherwise exempt or not required under applicable law to
effect
such qualification or license and no demand for such qualification or license
has been made upon the Servicer by any such state, and in any event the
Servicer
is in compliance with the laws of each such State to the extent necessary
to
ensure the enforceability of each Mortgage Loan and the servicing of the
Mortgage Loans in accordance with the terms of this Agreement;
(b) The
Servicer has full power and authority to execute, deliver and perform,
and to
enter into and consummate all transactions contemplated by this Agreement
and to
conduct its business as presently conducted, has duly authorized the execution,
delivery and performance of this Agreement, has duly executed and delivered
this
Agreement, and this Agreement constitutes a legal, valid and binding obligation
of the Servicer, enforceable against it in accordance with its terms subject
to
bankruptcy laws and other similar laws of general application affecting
rights
of creditors and subject to the application of the rules of equity, including
those respecting the availability of specific performance;
(c) None
of
the execution and delivery of this Agreement, the consummation of the
transactions contemplated thereby and hereby, or the fulfillment of or
compliance with the terms and conditions of this Agreement will conflict
with
any of the terms, conditions or provisions of the Servicer's articles of
incorporation or by-laws or materially conflict with or result in a material
breach of any of the terms, conditions or provisions of 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 material violation of any law, rule, regulation,
order, judgment or decree to which the Servicer or its property is
subject;
(d) There
is
no litigation pending or, to the Seller’s knowledge, threatened with respect to
the Servicer which is reasonably likely to have a material adverse effect
on the
execution, delivery or enforceability of this Agreement, or which is reasonably
likely to have a material adverse effect on the financial condition of
the
Servicer;
(e) 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 consummation of
the
transactions contemplated by this Agreement except for consents, approvals,
authorizations and orders which have been obtained;
(f) The
collection and servicing practices used by the Servicer, with respect to
each
Mortgage Note and Mortgage have been in all material respects legal. With
respect to escrow deposits and payments that the Servicer collects, all
such
payments are in the possession of, or under the control of, the Servicer,
and
there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. No escrow deposits
or
other charges or payments due under the Mortgage Note have been capitalized
under any Mortgage or the related Mortgage Note;
(g) The
Servicer is in good standing to service mortgage loans for Xxxxxx Xxx and
Xxxxxxx Mac and no event has occurred which would make the Servicer unable
to
comply with eligibility requirements or which would require notification
to
either Xxxxxx Mae or Xxxxxxx Mac;
(h) No
written statement, report or other document furnished or to be furnished
pursuant to the Agreement contains or will contain any statement that is
or will
be inaccurate or misleading in any material respect or omits to state a
material
fact required to be stated therein or necessary to make the information
and
statements therein not misleading;
(i) No
fraud
or
misrepresentation of a material fact
with
respect to the servicing of a Mortgage Loan has taken place on the part
of the
Servicer;
(j) At
the
time Servicer commenced servicing the Mortgage Loans, either (i) each
Mortgagor
was properly notified with respect to Servicer's servicing of the related
Mortgage Loan in accordance with the Xxxxxxxx Xxxxxxxx National Affordable
Housing Act of 1990, as the same may be amended from time to time, and
the
regulations provided
in
accordance with the Real Estate Settlement Procedures Act or (ii) such
notification was not required;
(k) At
the
time
Servicer commenced servicing the Mortgage Loans, all
applicable taxing authorities and insurance companies (including primary
mortgage insurance policy insurers, if applicable) and/or agents were notified
of the transfer of the servicing of the Mortgage Loans to Servicer, or
its
designee, and Servicer currently receives all related notices, tax bills
and
insurance statements. Additionally, any and all costs, fees and expenses
associated with the Servicer’s commencement of the servicing of the Mortgage
Loans, including the costs of any insurer notifications, the transfer or
implementation of tax service contracts, flood certification contracts,
and any
and all other servicing transfer-related costs and expenses have been paid
for
by the Servicer and will, in no event, be the responsibility of the Owner;
and
(l) The
collection
and servicing practices with respect to each Mortgage Note and Mortgage
have
been in all material respects legal. With respect to escrow deposits and
payments that the Servicer collects, all such payments are in the possession
of,
or under the control of, the Servicer, and there exist no deficiencies
in
connection therewith for which customary arrangements for repayment thereof
have
not been made. No escrow deposits or other charges or payments due under
the
Mortgage Note have been capitalized under any Mortgage or the related Mortgage
Note.
ARTICLE
IV
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
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Section
4.01 Servicer
to Act as Servicer.
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The
Servicer, as independent contract servicer, shall service and administer
the
Mortgage Loans in accordance with this Agreement and with Accepted Servicing
Practices (giving due consideration to the Owner's reliance on the Servicer),
and shall have full power and authority, acting alone, to do or cause to
be done
any and all things in connection with such servicing and administration
which
the Servicer may deem necessary or desirable and consistent with the terms
of
this Agreement and with Accepted Servicing Practices and shall exercise
the same
care that it customarily employs for its own account. Except as set forth
in
this Agreement, the Servicer shall service the Mortgage Loans in accordance
with
Accepted Servicing Practices in compliance with the servicing provisions
of the
Xxxxxx Xxx Guide, which include, but are not limited to, provisions regarding
the liquidation of Mortgage Loans, the collection of Mortgage Loan payments,
the
payment of taxes, insurance and other charges, the maintenance of hazard
insurance with a Qualified Insurer, the maintenance of fidelity bond and
errors
and omissions insurance, inspections, the restoration of Mortgaged Property,
the
maintenance of Primary Mortgage Insurance Policies, insurance claims, and
title
insurance, management of REO Property, permitted withdrawals with respect
to REO
Property, liquidation reports, and reports of foreclosures and abandonments
of
Mortgaged Property, the transfer of Mortgaged Property, the release of
Mortgage
Loan Documents, annual statements, and examination of records and facilities.
In
the event of any conflict, inconsistency or discrepancy between any of
the
servicing provisions of this Agreement and any of the servicing provisions
of
the Xxxxxx Mae Guide, the provisions of this Agreement shall control and
be
binding upon the Owner and the Servicer. The Owner shall, upon reasonable
request, deliver powers-of-attorney to the Servicer sufficient to allow
the
Servicer as servicer to execute all documentation requiring execution on
behalf
of Owner with respect to the servicing of the Mortgage Loans, including
satisfactions, partial releases, modifications and foreclosure documentation
or,
in the alternative, shall as promptly as reasonably possible, execute and
return
such documentation to the Servicer.
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 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 Owner, provided, however, that unless the
Servicer
has obtained the prior written consent of the Owner, the Servicer shall
not
permit any modification with respect to any Mortgage Loan that would change
the
Mortgage Interest Rate, forgive the payment of principal or interest, reduce
or
increase the outstanding principal balance (except for actual payments
of
principal) or change the final maturity date on such Mortgage Loan. In
the event
of any such modification which has been agreed to in writing by the Owner
and
which permits the deferral of interest or principal payments on any Mortgage
Loan, the Servicer shall, on the Business Day immediately preceding the
related
Remittance Date in any month in which any such principal or interest payment
has
been deferred, deposit in the Custodial Account from its own funds, in
accordance with Section 4.04 and Section 5.03, the difference between (a)
such
month's principal and one month's interest at the related Mortgage Loan
Remittance Rate on the unpaid principal balance of such Mortgage Loan and
(b)
the amount paid by the Mortgagor. The Servicer shall be entitled to
reimbursement for such advances to the same extent as for all other advances
pursuant to Section 4.05. Without limiting the generality of the foregoing,
the
Servicer shall continue, and is hereby authorized and empowered, to prepare,
execute and deliver, 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.
The
Servicer shall perform all of its servicing responsibilities hereunder
or may,
with the Owner's prior written approval, cause a subservicer to perform
any such
servicing responsibilities on its behalf, but the use by the Servicer of
a
subservicer shall not release the Servicer from any of its obligations
hereunder
and the Servicer shall remain responsible hereunder for all acts and omissions
of each subservicer as fully as if such acts and omissions were those of
the
Servicer. Any such subservicer that the Owner shall be requested to consent
to
must be a Xxxxxx Xxx approved seller/servicer or a Xxxxxxx Mac seller/servicer
in good standing and no event shall have occurred, including but not limited
to,
a change in insurance coverage, which would make it unable to comply with
the
eligibility requirements for lenders imposed by Xxxxxx Xxx or for
seller/servicers by Xxxxxxx Mac, or which would require notification to
Xxxxxx
Xxx or Xxxxxxx Mac. The Servicer shall pay all fees and expenses of each
subservicer from its own funds, and a subservicer's fee shall not exceed
the
Servicing Fee.
At
the
cost and expense of the Servicer, without any right of reimbursement from
the
Custodial Account, the Servicer shall be entitled to terminate the rights
and
responsibilities of a subservicer and arrange, with the Owner's prior written
approval, for any servicing responsibilities to be performed by a successor
subservicer meeting the requirements in the preceding paragraph, provided,
however, that nothing contained herein shall be deemed to prevent or prohibit
the Servicer, at the Servicer's option, from electing to service the related
Mortgage Loans itself. In the event that the Servicer's responsibilities
and
duties under this Agreement are terminated pursuant to Section 8.04, 9.01
or
10.01, and if requested to do so by the Owner, the Servicer shall at its
own
cost and expense terminate the rights and responsibilities of each subservicer
effective as of the date of termination of the Servicer. The Servicer shall
pay
all fees, expenses or penalties necessary in order to terminate the rights
and
responsibilities of each subservicer from the Servicer's own funds without
reimbursement from the Owner.
Notwithstanding
any of the provisions of this Agreement relating to agreements or arrangements
between the Servicer and a subservicer or any reference herein to actions
taken
through a subservicer or otherwise, the Servicer shall not be relieved
of its
obligations to the Owner and shall be obligated to the same extent and
under the
same terms and conditions as if it alone were servicing and administering
the
Mortgage Loans. The Servicer shall be entitled to enter into an agreement
with a
subservicer for indemnification of the Servicer by the subservicer and
nothing
contained in this Agreement shall be deemed to limit or modify such
indemnification.
Any
subservicing agreement and any other transactions or services relating
to the
Mortgage Loans involving a subservicer shall be deemed to be between such
subservicer and Servicer alone, and the Owner shall have no obligations,
duties
or liabilities with respect to such Subservicer including no obligation,
duty or
liability of Owner to pay such subservicer's fees and expenses. For purposes
of
distributions and advances by the Servicer pursuant to this Agreement,
the
Servicer shall be deemed to have received a payment on a Mortgage Loan
when a
subservicer has received such payment.
Section
4.02 Collection
of Mortgage Loan Payments.
Continuously
from the Effective Date until the date each Mortgage Loan ceases to be
subject
to this Agreement, the Servicer will proceed with reasonable diligence
to
collect all payments due under each Mortgage Loan when the same shall become
due
and payable and shall, to the extent such procedures shall be consistent
with
this Agreement and the terms and provisions of related Primary Mortgage
Insurance Policy, follow such collection procedures as it follows with
respect
to mortgage loans comparable to the Mortgage Loans and held for its own
account.
Further, the Servicer will take reasonable care in ascertaining and estimating
annual ground rents, taxes, assessments, water rates, fire and hazard insurance
premiums, mortgage insurance premiums, and all other charges that, as provided
in the Mortgage, will become due and payable to the end that the installments
payable by the Mortgagors will be sufficient to pay such charges as and
when
they become due and payable.
Section
4.03 Realization
Upon Defaulted Mortgage Loans.
The
Servicer shall use its reasonable efforts, consistent with the procedures
that
the Servicer would use in servicing loans for its own account and the
requirements of the Xxxxxx Mae Guide, to foreclose upon or otherwise comparably
convert the ownership of properties securing such of the Mortgage Loans
as come
into and continue in default and as to which no satisfactory arrangements
can be
made for collection of delinquent payments pursuant to Section 4.01. The
Servicer shall use its reasonable efforts to realize upon defaulted Mortgage
Loans in such manner as will maximize the receipt of principal and interest
by
the Owner, taking into account, among other things, the timing of foreclosure
proceedings. The foregoing is subject to the provisions that, in any case
in
which Mortgaged Property shall have suffered damage, the Servicer shall
not be
required to expend its own funds toward the restoration of such property
unless
it shall determine in its discretion (i) that such restoration will increase
the
proceeds of liquidation of the related Mortgage Loan to the Owner after
reimbursement to itself for such expenses, and (ii) that such expenses
will be
recoverable by the Servicer through Insurance Proceeds or Liquidation Proceeds
from the related Mortgaged Property, as contemplated in Section 4.05. The
Servicer shall notify the Owner in writing of the commencement of foreclosure
proceedings. The Servicer shall be responsible for all costs and expenses
incurred by it in any such proceedings or functions as Servicing Advances;
provided, however, that it shall be entitled to reimbursement therefor
from the
related Mortgaged Property, as contemplated in Section 4.05. Notwithstanding
anything to the contrary contained herein, in connection with a foreclosure
or
acceptance of a deed in lieu of 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 Owner otherwise requests
an
environmental inspection or review of such Mortgaged Property, such an
inspection or review is to be conducted by a qualified inspector. Upon
completion of the inspection, the Servicer shall promptly provide the Owner
with
a written report of the environmental inspection. After reviewing the
environmental inspection report, the Owner shall determine how the Servicer
shall proceed with respect to the Mortgaged Property.
Section
4.04 Establishment
of Custodial Accounts; Deposits in Custodial Accounts.
The
Servicer shall segregate and hold all funds collected and received pursuant
to
each Mortgage Loan separate and apart from any of its own funds and general
assets and shall establish and maintain one or more Custodial Accounts.
Each
Custodial Account shall be established with a Qualified Depository. To
the
extent such funds are not deposited in a Custodial Account, such funds
may be
invested in Permitted Investments for the benefit of the Owner (with any
income
earned thereon for the benefit of the Servicer). Funds deposited in the
Custodial Account may be drawn on by the Servicer in accordance with Section
4.05. The creation of any Custodial Account shall be evidenced by a letter
agreement in the form shown in Exhibit
B
hereto.
The original of such letter agreement shall be furnished to the Owner upon
request. The Servicer acknowledges and agrees that the Servicer shall bear
any
losses incurred with respect to Permitted Investments. The amount of any
such
losses shall be immediately deposited by the Servicer in the Custodial
Account,
as appropriate, out of the Servicer's own funds, with no right to reimbursement
therefor.
The
Servicer shall deposit in a mortgage clearing account on a daily basis,
and in
the Custodial Account or Accounts no later than the second Business Day
after
receipt of funds and retain therein the following payments and
collections:
(i) all
payments on account of principal, including Principal Prepayments, on the
Mortgage Loans received after the Cut-off Date;
(ii) all
payments on account of interest on the Mortgage Loans adjusted to the related
Mortgage Loan Remittance Rate received after the Cut-off Date;
(iii) all
Liquidation Proceeds and REO Disposition Proceeds received after the Cut-off
Date;
(iv) any
net
amounts received by the Servicer after the Cut-off Date in connection with
any
REO Property pursuant to Section 4.13;
(v) all
Insurance Proceeds received after the Cut-off Date including amounts required
to
be deposited pursuant to Sections 4.08 and 4.10, 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 the Servicer's
normal
servicing procedures, the loan documents or applicable law;
(vi) all
Condemnation Proceeds affecting any Mortgaged Property received after the
Cut-off Date other than proceeds to be held in the Escrow Account and applied
to
the restoration or repair of the Mortgaged Property or released to the
Mortgagor
in accordance with the Servicer's normal servicing procedures, the loan
documents or applicable law;
(vii) any
Monthly Advances as provided in Section 5.03;
(viii) any
amounts received after the Cut-off Date and required to be deposited in
the
Custodial Account pursuant to 6.02; and
(ix) with
respect to each full or partial Principal Prepayment received after the
Cut-off
date, any Prepayment Interest Shortfalls, to the extent of the Servicer’s
aggregate Servicing Fee received with respect to the related Due
Period.
The
foregoing requirements for deposit in the Custodial Account shall be exclusive,
it being understood and agreed that, without limiting the generality of
the
foregoing, payments in the nature of late payment charges and assumption
fees,
to the extent permitted by Section 6.01, need not be deposited by the Servicer
in the Custodial Account. Any interest paid on funds deposited in the Custodial
Account by the Qualified Depository 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 4.05(iv).
Section
4.05 Permitted
Withdrawals From the Custodial Account.
The
Servicer may, from time to time, make withdrawals from the Custodial Account
for
the following purposes:
(i)
to
make payments to the Owner in the amounts and in the manner provided for
in
Section 5.01;
(ii)
to
reimburse itself for Monthly Advances, the Servicer's right to reimburse
itself
pursuant to this subclause (ii) being limited to amounts received on the
related
Mortgage Loan which represent late collections (net of the related Servicing
Fees) of principal and/or interest respecting which any such advance was
made;
(iii)
to
reimburse itself for unreimbursed Servicing Advances and unreimbursed Monthly
Advances, the Servicer's right to reimburse itself pursuant to this subclause
(iii) with respect to any Mortgage Loan being limited to Liquidation Proceeds,
Condemnation Proceeds and Insurance Proceeds received after the Cut-off
Date
related to such Mortgage Loan;
(iv)
to
pay to itself as servicing compensation (a) any interest earned on funds
in the
Custodial Account (all such interest to be withdrawn monthly not later
than each
Remittance Date) and (b) any payable Servicing Fee;
(v)
to
reimburse itself for any Nonrecoverable Advances:
(vi)
to
transfer funds to another Qualified Depository in accordance with Section
4.09
hereof;
(vii)
to
remove funds inadvertently placed in the Custodial Account in error by
the
Servicer; and
(viii)
to
clear and terminate the Custodial Account upon the termination of this
Agreement.
Section
4.06 Establishment
of Escrow Accounts; Deposits in Escrow Accounts.
The
Servicer shall segregate and hold all funds collected and received pursuant
to
each Mortgage Loan which constitute Escrow Payments separate and apart
from any
of its own funds and general assets and shall establish and maintain one
or more
Escrow Accounts. Each Escrow Account shall be established with a Qualified
Depository. To the extent such funds are not deposited in an Escrow Account,
such funds may be invested in Permitted Investments. Funds deposited in
an
Escrow Account may be drawn on by the Servicer in accordance with Section
4.07.
The creation of any Escrow Account shall be evidenced by a letter agreement
in
the form shown in Exhibit
C.
The
original of such letter agreement shall be furnished to the Owner upon
request.
The Servicer acknowledges and agrees that the Servicer shall bear any losses
incurred with respect to Permitted Investments. The amount of any such
losses
shall be immediately deposited by the Servicer in the Escrow Account, as
appropriate, out of the Servicer's own funds, with no right to reimbursement
therefor.
The
Servicer shall deposit in a mortgage clearing account on a daily basis,
and in
the Escrow Account or Accounts no later than the second Business Day after
receipt of funds and retain therein:
(i)
all
Escrow Payments collected on account of the Mortgage Loans, for the purpose
of
effecting timely payment of any items as are required under the terms of
this
Agreement;
(ii)
all
Insurance Proceeds which are to be applied to the restoration or repair
of any
Mortgaged Property; and
(iii)
all
Servicing Advances for Mortgagors whose Escrow Payments are insufficient
to
cover escrow disbursements.
The
Servicer shall make withdrawals from an Escrow Account only to effect such
payments as are required under this Agreement, and for such other purposes
as
shall be as set forth in and in accordance with Section 4.07. The Servicer
shall
be entitled to retain any interest paid on funds deposited in an Escrow
Account
by the Qualified Depository other than interest on escrowed funds required
by
law to be paid to the Mortgagor and, to the extent required by law, the
Servicer
shall pay interest on escrowed funds to the Mortgagor notwithstanding that
the
Escrow Account is non-interest bearing or that interest paid thereon is
insufficient for such purposes.
Section
4.07 Permitted
Withdrawals From Escrow Account.
Withdrawals
from the Escrow Account may be made by the Servicer only:
(i) to
effect
timely payments of ground rents, taxes, assessments, water rates, fire
and
hazard insurance premiums, Primary Mortgage Insurance Policy premiums,
if
applicable, and comparable items;
(ii) to
reimburse Servicer for any Servicing Advance made by Servicer with respect
to a
related Mortgage Loan but only from amounts received on the related Mortgage
Loan which represent late payments or collections of Escrow Payments
thereunder;
(iii) to
refund
to the Mortgagor any funds as may be determined to be overages;
(iv) for
transfer to the Custodial Account in connection with an acquisition of
REO
Property;
(v) for
application to restoration or repair of the Mortgaged Property;
(vi) to
pay to
the Servicer, or to the Mortgagor to the extent required by law, any interest
paid on the funds deposited in the Escrow Account;
(vii) to
pay to
the Mortgagors or other parties Insurance Proceeds deposited in accordance
with
Section 4.06;
(viii) to
remove
funds inadvertently placed in an Escrow Account in error by the Servicer;
and
(ix) to
clear
and terminate the Escrow Account on the termination of this Agreement.
As
part
of its servicing duties, the Servicer shall pay to the Mortgagors interest
on
funds in an Escrow Account, to the extent required by law, and to the extent
that interest earned on funds in the Escrow Account is insufficient, shall
pay
such interest from its own funds, without any reimbursement
therefor.
Section
4.08 Payment
of Taxes, Insurance and Other Charges; Maintenance of Primary Mortgage
Insurance
Policies; Collections Thereunder.
With
respect to each Mortgage Loan, the Servicer shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates
and other
charges which are or may become a lien upon the Mortgaged Property and
the
status of Primary Mortgage Insurance 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 and at a time
appropriate for securing maximum discounts allowable, employing for such
purpose
deposits of the Mortgagor in the Escrow Account which shall have been estimated
and accumulated by the Servicer in amounts sufficient for such purposes,
as
allowed under the terms of the Mortgage or applicable law. To the extent
that
the Mortgage does not provide for Escrow Payments, the Servicer shall determine
that any such payments are made by the Mortgagor at the time they first
become
due. The Servicer assumes full responsibility for the timely payment of
all such
bills and shall effect timely payments of all such bills irrespective of
the
Mortgagor's faithful performance in the payment of same or the making of
the
Escrow Payments and shall make advances from its own funds to effect such
payments.
The
Servicer will maintain in full force and effect Primary Mortgage Insurance
Policies issued by a Qualified Insurer with respect to each Mortgage Loan
for
which such coverage is herein required. Such coverage will be maintained
until
the ratio of the current outstanding principal balance of the related Mortgage
Loan to the appraised value of the related Mortgaged Property, based on
the most
recent appraisal of the Mortgaged Property performed by a Qualified Appraiser,
such appraisal to be included in the Servicing File, is reduced to 80.00%
or
less. The Servicer will not cancel or refuse to renew any Primary Mortgage
Insurance Policy that is required to be kept in force under this Agreement
unless a replacement Primary Mortgage Insurance Policy for such canceled
or
nonrenewed policy is obtained from and maintained with a Qualified Insurer.
The
Servicer shall not take any action which would result in non-coverage under
any
applicable Primary Mortgage Insurance 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 6.01, the Servicer shall promptly notify the insurer
under
the related Primary Mortgage Insurance Policy, if any, of such assumption
or
substitution of liability in accordance with the terms of such policy and
shall
take all actions which may be required by such insurer as a condition to
the
continuation of coverage under the Primary Mortgage Insurance Policy. If
such
Primary Mortgage Insurance Policy is terminated as a result of such assumption
or substitution of liability, the Servicer shall obtain a replacement Primary
Mortgage Insurance Policy as provided above.
In
connection with its activities as servicer, the Servicer agrees to prepare
and
present, on behalf of itself and the Owner, claims to the insurer under
any
Private Mortgage Insurance Policy in a timely fashion in accordance with
the
terms of such Primary Mortgage Insurance Policy and, in this regard, to
take
such action as shall be necessary to permit recovery under any Primary
Mortgage
Insurance Policy respecting a defaulted Mortgage Loan. Pursuant to Section
4.04,
any amounts collected by the Servicer under any Primary Mortgage Insurance
Policy shall be deposited in the Custodial Account, subject to withdrawal
pursuant to Section 4.05.
Section
4.09 Transfer
of Accounts.
The
Servicer may transfer the Custodial Account or the Escrow Account to a
different
Qualified Depository from time to time. The Servicer shall notify the Owner
of
any such transfer within 15 Business Days of transfer.
Section
4.10 Maintenance
of Hazard Insurance.
The
Servicer shall cause to be maintained for each Mortgage Loan fire and hazard
insurance with extended coverage as is customary in the area where the
Mortgaged
Property is located in an amount which is equal to the lesser of (i) the
maximum
insurable value of the improvements securing such Mortgage Loan or (ii)
the
greater of (a) the outstanding principal balance of the Mortgage Loan,
and (b)
the percentage such that the proceeds thereof shall be sufficient to prevent
the
Mortgagor and/or the Mortgagee from becoming a co-insurer. If the Mortgaged
Property is in an area identified in the Federal Register by the Federal
Emergency Management Agency as being a special flood hazard area that has
federally-mandated flood insurance requirements, the Servicer will cause
to be
maintained a flood insurance policy meeting the requirements of the current
guidelines of the Federal Insurance Administration with a generally acceptable
insurance carrier, in an amount representing coverage not less than the
least of
(i) the outstanding principal balance of the Mortgage Loan, (ii) the maximum
insurable value of the improvements securing such Mortgage Loan or (iii)
the
maximum amount of insurance which is available under the Flood Disaster
Protection Act of 1973, as amended. The Servicer shall also maintain on
the 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 required
and
available under the Flood Disaster Protection Act of 1973, as amended,
flood
insurance in an amount as provided above. 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 Mortgaged Property or REO
Property, or released to the Mortgagor in accordance with the Servicer's
normal
servicing procedures, shall be deposited in the Custodial Account, subject
to
withdrawal pursuant to Section 4.05. It is understood and agreed that no
other
additional insurance need be required by the Servicer or the Mortgagor
or
maintained on property acquired in respect of the Mortgage Loans, other
than
pursuant to the Xxxxxx Xxx Guide or such applicable state or federal laws
and
regulations as shall at any time be in force and as shall require such
additional insurance. All such policies shall be endorsed with standard
mortgagee clauses with loss payable to the Servicer and its successors
and/or
assigns and shall provide for at least thirty days prior written notice
of any
cancellation, reduction in the amount or material change in coverage to
the
Servicer. 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 currently reflect a General Policy Rating
in
Best's Key Rating Guide currently acceptable to Xxxxxx Mae and are licensed
to
do business in the state wherein the property subject to the policy is
located.
Section
4.11 Adjustments
to Mortgage Interest Rate and Monthly Payment.
On
each
applicable Adjustment Date, the Mortgage Interest Rate shall be adjusted,
in
compliance with the requirements of the related Mortgage and Mortgage Note,
to
equal the sum of the Index plus the Margin (rounded in accordance with
the
related Mortgage Note) subject to the applicable Periodic Rate Cap and
Lifetime
Rate Cap, as set forth in the Mortgage Note. The Servicer shall execute
and
deliver the notices required by each Mortgage and Mortgage Note and applicable
laws and regulations regarding interest rate adjustments.
Section
4.12 Fidelity
Bond, Errors and Omissions Insurance.
The
Servicer shall maintain, at its own expense, a blanket fidelity bond and
an
errors and omissions insurance policy, with broad coverage with responsible
companies on all officers, employees or other persons acting in any capacity
with regard to the Mortgage Loans and who handle funds, money, documents
and
papers relating to the Mortgage Loans. The Fidelity Bond and errors and
omissions insurance shall be in the form of the Mortgage Banker's Blanket
Bond
and shall protect and insure the Servicer against losses, including forgery,
theft, embezzlement, fraud, errors and omissions and negligent acts of
such
persons. Such Fidelity Bond and errors and omissions insurance shall also
protect and insure the Servicer against losses in connection with the failure
to
maintain any insurance policies required pursuant to this Agreement and
the
release or satisfaction of a Mortgage Loan without having obtained payment
in
full of the indebtedness secured thereby. No provision of this Section
4.12
requiring the Fidelity Bond and errors and omissions insurance 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 insurance
policy shall be at least equal to the corresponding amounts required by
Xxxxxx
Xxx in the Xxxxxx Mae Guide or by Xxxxxxx Mac in the Xxxxxxx Mac Guide.
The
Servicer shall, upon request of Owner, deliver to the Owner a certificate
from
the surety and the insurer as to the existence of the Fidelity Bond and
errors
and omissions insurance policy and shall obtain a statement from the surety
and
the insurer that such Fidelity Bond or insurance policy shall in no event
be
terminated or materially modified without thirty days prior written notice
to
the Owner. The Servicer shall notify the Owner within five Business Days
of
receipt of notice that such Fidelity Bond or insurance policy will be,
or has
been, materially modified or terminated. The Owner and its successors or
assigns
as their interests may appear must be named as loss payees on the Fidelity
Bond
and as additional insured on the errors and omissions policy.
Section
4.13 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 Owner or its designee. Any such Person or Persons holding such
title
other than the Owner shall acknowledge in writing that such title is being
held
as nominee for the benefit of the Owner.
The
Servicer shall notify the Owner in accordance with prudent servicing practices
of each acquisition of REO Property upon such acquisition, and thereafter
assume
the responsibility for marketing such REO Property in accordance with Accepted
Servicing Practices. Thereafter, the Servicer shall continue to provide
certain
administrative services to the Owner relating to such REO Property as set
forth
in this Section 4.13. The REO Property must be sold within three years
following
the end of the calendar year of the date of acquisition, unless a REMIC
election
has been made with respect to the arrangement under which the Mortgage
Loans and
REO Property are held and (i) the Owner shall have been supplied with an
Opinion
of Counsel to the effect that the holding by the related trust of such
Mortgaged
Property subsequent to such three-year period (and specifying the period
beyond
such three-year period for which the Mortgaged Property may be held) will
not
result in the imposition of taxes on “prohibited transactions” of the related
trust as defined in Section 860F of the Code, or cause the related REMIC
to fail
to qualify as a REMIC, in which case the related trust may continue to
hold such
Mortgaged Property (subject to any conditions contained in such Opinion
of
Counsel), or (ii) the Owner (at the Servicer’s expense) or the Servicer shall
have applied for, prior to the expiration of such three-year period, an
extension of such three-year period in the manner contemplated by Section
856(e)(3) of the Code, in which case the three-year period shall be extended
by
the applicable period. If a period longer than three years is permitted
under
the foregoing sentence and is necessary to sell any REO Property, (i) the
Servicer shall report monthly to the Owner as to progress being made in
selling
such REO Property and (ii) if, with the written consent of the Owner, 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 between the Servicer and Owner shall be entered
into
with respect to such purchase money mortgage.
The
Servicer shall not permit the creation of any “interests” (within the meaning of
Section 860G of the Code) in any REMIC. The Servicer shall not enter into
any
arrangement by which a REMIC will receive a fee or other compensation for
services nor permit a REMIC to receive any income from assets other than
“qualified mortgages” as defined in Section 860G(a)(3) of the Code or “permitted
investments” as defined in Section 860G(a)(5) of the Code.
Notwithstanding
any other provision of this Agreement, if a REMIC election has been made,
no
Mortgaged Property held by a REMIC shall be rented (or allowed to continue
to be
rented) or otherwise used for the production of income by or on behalf
of the
related trust or sold in such a manner or pursuant to any terms that would
(i)
cause such Mortgaged Property to fail to qualify at any time as “foreclosure
property” within a meaning of Section 860G(a)(8) of the Code, (ii) subject the
related trust to the imposition of any federal or state income taxes on
“net
income from foreclosure property” with respect to such Mortgaged Property within
the meaning of Section 860G(c) of the Code, or (iii) cause the sale of
such
Mortgaged Property to result in the receipt by the related trust or any
income
from non-permitted assets as described in Section 860F(a) (2)(B) of the
Code,
unless the Servicer has agreed to indemnify and hold harmless the related
trust
with respect to the imposition of any such taxes.
The
Servicer shall, either itself or through an agent selected by the Servicer,
and
in accordance with the Xxxxxx Xxx Guide, manage, conserve, protect and
operate
each 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.
Each
REO Disposition 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 interest of
the
Owner. The REO Disposition Proceeds from the 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
for any related Servicing Advances, or Monthly Advances made pursuant to
Section
5.03.
The
Servicer shall cause each REO Property to be inspected promptly upon the
acquisition of title thereto and shall cause each REO Property to be inspected
at least monthly thereafter or more frequently as may be required by the
circumstances. The Servicer shall make or cause the inspector to make a
written
report of each such inspection. Such reports shall be retained in the Servicing
File and copies thereof shall be forwarded by the Servicer to the
Owner.
Notwithstanding
anything to the contrary set forth in this Section 4.13, the parties hereto
hereby agree that the Owner, at its option, shall be entitled to manage,
conserve, protect and operate each REO Property for its own benefit (such
option, an "REO Option"). In connection with the exercise of an REO Option,
the
prior two paragraphs and the related provisions of Section 4.03 and Section
4.04(iii) (such provisions, the “REO Marketing Provisions”) shall be revised as
follows. Following the acquisition of any Mortgaged Property, the Servicer
shall
submit a detailed invoice to the Owner for all related Servicing Advances
and,
upon exercising the REO Option, the Owner shall promptly reimburse the
Servicer
for such amounts. In the event the REO Option is exercised with respect
to an
REO Property, Section 4.04 (iii) shall not be applicable thereto. References
made in Section 4.03 with respect to the reimbursement of Servicing Advances
shall, for purposes of such REO Property, be deemed to be covered by this
paragraph. The Owner acknowledges that, in the event it exercises an REO
Option,
with respect to the related REO Property, there shall be no breach by the
Servicer based upon or arising out of the Servicer's failure to comply
with the
REO Marketing Provisions.
ARTICLE
V
PAYMENTS
TO THE OWNER
Section
5.01 Remittances.
On
each
Remittance Date, the Servicer shall remit to the Owner (i) all amounts
credited
to the Custodial Account as of the close of business on the related preceding
Determination Date, except (a) Partial Principal Prepayments received on
or
after the first day of the month in which the Remittance Date occurs shall
be
remitted to the Owner on the next following Remittance Date, (b) Full Principal
Prepayments received on or before the 15th
day of
the month in which a Remittance Date occurs shall be remitted to the Owner
on
the Remittance Date of such month, and (c) Full Principal Prepayments received
after the 15th
day of
the month shall be remitted to the Owner on the next following Remittance
Date,
each net of charges against or withdrawals from the Custodial Account pursuant
to Section 4.05, plus, to the extent not already deposited in the Custodial
Account, the sum of (ii) all Monthly Advances, if any, which the Servicer
is
obligated to distribute pursuant to Section 5.03 and (iii) all Prepayment
Interest Shortfalls the Servicer is required to make up pursuant to Section
4.04, minus (iv) any amounts attributable to Monthly Payments collected
after
the Cut-off Date but due on a Due Date or Dates subsequent to the last
day of
the related Due Period, which amounts shall be remitted on the related
Remittance Date next succeeding the Due Period for such amounts.
With
respect to any remittance received by the Owner after the Business Day
on which
such payment was due, the Servicer shall pay to the Owner 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 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 related 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
5.02 Statements
to the Owner.
The
Servicer shall furnish to the Owner an individual Mortgage Loan accounting
report (a “Report”), as of the last Business Day of each month, in the
Servicer's assigned loan number order to document Mortgage Loan payment
activity
on an individual Mortgage Loan basis. With respect to each month, such
Report
shall be received by the Owner (i) no later than the fifth Business Day
of the
following month of the related Remittance Date on a disk or tape or other
computer-readable format, in such format as may be mutually agreed upon
by both
the Owner and the Servicer, and (ii) no later than the tenth Business Day
of the
following month of the related Remittance Date in hard copy, which Report
shall
contain the following:
| (i) |
with
respect to each Monthly Payment, the amount of such remittance
allocable
to interest
|
| (ii) |
the
amount of servicing compensation received by the Servicer during
the prior
distribution period;
|
| (iii) |
the
aggregate Stated Principal Balance of the Mortgage Loans;
|
| (iv) |
the
number and aggregate outstanding principal balances of Mortgage
Loans (a)
delinquent (1) 30 to 59 days, (2) 60 to 89 days, (3) 90 days
or more; (b)
as to which foreclosure has commenced; and (c) as to which REO
Property
has been acquired; and
|
| (v) |
such
other reports as may reasonably be required by the
Owner.
|
The
Servicer shall also provide a trial balance, sorted in the Owner's assigned
loan
number order, and such other loan level scheduled-scheduled remittance
information as described on Exhibit
E,
in
electronic tape form, with each such Report.
The
Servicer shall prepare and file any and all information statements or other
filings required to be delivered to any governmental taxing authority or
to
Owner pursuant to any applicable law with respect to the Mortgage Loans
and the
transactions contemplated hereby. In addition, the Servicer shall provide
the
Owner with such information concerning the Mortgage Loans as is necessary
for
the Owner to prepare its federal income tax return as the Owner may reasonably
request from time to time.
In
addition, not more than 60 days after the end of each calendar year, the
Servicer shall furnish to each Person who was an Owner at any time during
such
calendar year an annual statement in accordance with the requirements of
applicable federal income tax law as to the aggregate of remittances of
principal and interest for the applicable portion of such year.
Section
5.03 Monthly
Advances by the Servicer.
Not
later
than the close of business on the Business Day preceding each Remittance
Date,
the Servicer shall deposit in the Custodial Account an amount equal to
all
payments not previously advanced by the Servicer, whether or not deferred
pursuant to Section 4.01, of Monthly Payments, adjusted to the related
Mortgage
Loan Remittance Rate, which are delinquent at the close of business on
the
related Determination Date; provided, however, that the amount of any such
deposit may be reduced by (i) the Amount Held for Future Distribution (as
defined below) then on deposit in the Custodial Account, plus (ii) with
respect
to the initial Remittance Date, the Non-held Early Pay Amount (as defined
below). Any portion of the Amount Held for Future Distribution used to
pay
Monthly Advances shall be replaced by the Servicer by deposit into the
Custodial
Account on any future Remittance Date to the extent that the funds that
are
available in the Custodial Account for remittance to the Owner on such
Remittance Date are less than the amount of payments required to be made
to the
Owner on such Remittance Date.
The
“Amount Held for Future Distribution” as to any Remittance Date shall be the
total of the amounts held in the Custodial Account at the close of business
on
the preceding Determination Date which were received after the Cut-off
Date on
account of (i) Liquidation Proceeds, Insurance Proceeds, and Partial Principal
Prepayments received or made in the month of such Remittance Date, (ii)
Full
Principal Payments received after the 15th
day of
the month in the month of such Remittance Date, and (iii) payments which
represent early receipt of scheduled payments of principal and interest
due on a
date or dates subsequent to the related Due Date. The "Non-held Early Pay
Amount" shall be the total of the amounts on account of payments which
represent
early receipt of scheduled payments of principal and interest received on or
prior to the Cut-off Date.
The
Servicer's obligation to make such Monthly Advances as to any Mortgage
Loan will
continue through the final disposition or liquidation of the Mortgaged
Property,
unless the Servicer deems such advance to be nonrecoverable from Liquidation
Proceeds, REO Disposition Proceeds or Insurance Proceeds with respect to
the
applicable Mortgage Loan. In such latter event, the Servicer shall deliver
to
the Owner an Officer's Certificate of the Servicer to the effect that an
officer
of the Servicer has reviewed the related Servicing File and has obtained
a
recent appraisal and has made the reasonable determination that any additional
advances are nonrecoverable from Liquidation or Insurance Proceeds with
respect
to the applicable Mortgage Loan.
Section
5.04 Liquidation
Reports.
Upon
the
foreclosure sale of any Mortgaged Property or the acquisition thereof by
the
Owner pursuant to a deed-in--lieu of foreclosure, the Servicer shall submit
to
the Owner a liquidation report with respect to such Mortgaged Property
in such
form as the Servicer and the Owner shall agree. The Servicer shall also
provide
reports on the status of REO Property containing such information as Owner
may
reasonably require.
ARTICLE
VI
GENERAL
SERVICING PROCEDURES
Section
6.01 Assumption
Agreements.
The
Servicer will, to the extent it has knowledge of any conveyance or prospective
conveyance by any Mortgagor of a Mortgaged Property (whether by absolute
conveyance or by contract of, sale, and whether or not the Mortgagor remains
or
is to remain liable under the Mortgage Note and/or the Mortgage), exercise
its
rights to accelerate the maturity of such Mortgage Loan under any "due-on-sale"
clause to the extent permitted by law; provided, however, that the Servicer
shall not exercise any such rights if prohibited by law or the terms of
the
Mortgage Note from doing so or if the exercise of such rights would impair
or
threaten to impair any recovery under the related Primary Mortgage Insurance
Policy, if any. If the Servicer reasonably believes it is unable under
applicable law to enforce such "due-on-sale" clause, the Servicer, with
the
approval of the Owner (such approval not to be unreasonably withheld),
will
enter into an assumption agreement with the person to whom the Mortgaged
Property has been conveyed or is proposed to be conveyed, pursuant to which
such
person becomes liable under the Mortgage Note and, to the extent permitted
by
applicable state law, the Mortgagor remains liable thereon. Where an assumption
is allowed pursuant to this Section 6.01, the Servicer, with the prior
consent
of the primary mortgage insurer, if any, is authorized to enter into a
substitution of liability agreement with the person to whom the Mortgaged
Property has been conveyed or is proposed to be conveyed pursuant to which
the
original mortgagor is released from liability and such Person is substituted
as
mortgagor and becomes liable under the related Mortgage Note. Any such
substitution of liability agreement shall be in lieu of an assumption
agreement.
In
connection with any such assumption or substitution of liability, the Servicer
shall follow the underwriting practices and procedures of the Xxxxxx Xxx
Guide.
With respect to an assumption or substitution of liability, the Mortgage
Interest Rate borne by the related Mortgage Note and the amount of the
Monthly
Payment may not be changed. The Servicer shall notify the Owner that any
such
substitution of liability or assumption agreement has been completed by
forwarding to the Owner the original of any such substitution of liability
or
assumption agreement, which document shall be added to the related Mortgage
Loan
Documents and shall, for all purposes, be considered a part of such related
mortgage file to the same extent as all other documents and instruments
constituting a part thereof. All fees collected by the Servicer for entering
into an assumption or substitution of liability agreement shall belong
to the
Servicer.
Notwithstanding
the foregoing paragraphs of this section or any other provision of this
Agreement, the Servicer shall not be deemed to be in default, breach or
any
other violation of its obligations hereunder by reason of any assumption
of a
Mortgage Loan by operation of law or any assumption which the Servicer
may be
restricted by law from preventing, for any reason whatsoever. For purposes
of
this Section 6.01, the term "assumption" is deemed to also include a sale
of the
Mortgaged Property subject to the Mortgage that is not accompanied by an
assumption or substitution of liability agreement.
Section
6.02 Satisfaction
of Mortgages and Release of Mortgage Loan Documents.
Upon
the
payment in full of any Mortgage Loan, the Servicer will immediately notify
the
Custodian with a certification and request for release by a Servicing Officer,
which certification shall include a statement to the effect that all amounts
received in connection with such payment which are required to be deposited
in
the Custodial Account pursuant to Section 4.04 have been so deposited,
and a
request for delivery to the Servicer of the portion of the Mortgage Loan
Documents held by the Custodian, and unless the related Mortgage Loans
are the
subject of a Pass-Through Transfer, such request is to be acknowledged
by the
Owner. Upon receipt of such certification and request, the Owner shall
promptly
release or cause the Custodian to promptly release the related Mortgage
Loan
Documents to the Servicer and the Servicer shall prepare and deliver for
execution by the Owner or at the Owner's option execute under the authority
of a
power of attorney delivered to the Servicer by the Owner any satisfaction
or
release. No expense incurred in connection with any instrument of satisfaction
or deed of reconveyance shall be chargeable to the Custodial
Account.
In
the
event the Servicer satisfies or releases a Mortgage without having obtained
payment in full of the indebtedness secured by the Mortgage or should it
otherwise prejudice any right the Owner may have under the mortgage instruments,
the Servicer, upon written demand, shall remit within two Business Days
to the
Owner the then outstanding principal balance of the related Mortgage Loan
by
deposit thereof in the Custodial Account. The Servicer shall maintain the
Fidelity Bond 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.
From
time
to time and as appropriate for the servicing or foreclosure of the Mortgage
Loans, including for the purpose of collection under any Primary Mortgage
Insurance Policy, upon request of the Servicer and delivery to the Custodian
of
a servicing receipt signed by a Servicing Officer (and unless the related
Mortgage Loans are the subject of a Pass-Through Transfer, acknowledged
by the
Owner), the Custodian shall release the portion of the Mortgage Loan Documents
held by the Custodian to the Servicer. Such servicing receipt shall obligate
the
Servicer to promptly return the related Mortgage Loan Documents to the
Custodian, when the need therefor by the Servicer no longer exists, unless
the
Mortgage Loan has been liquidated and the Liquidation Proceeds relating
to the
Mortgage Loan have been deposited in the Custodial Account or such documents
have been delivered to an attorney, or to a public trustee or other public
official as required by law, for purposes of initiating or pursuing legal
action
or other proceedings for the foreclosure of the Mortgaged Property either
judicially or non-judicially, and the Servicer has promptly delivered to
the
Owner or the Custodian a certificate of a Servicing Officer certifying
as to the
name and address of the Person to which such documents were delivered and
the
purpose or purposes of such delivery. Upon receipt of a certificate of
a
Servicing Officer stating that such Mortgage Loan was liquidated, the servicing
receipt shall be released by the Owner or the Custodian, as applicable,
to the
Servicer.
Section
6.03 Servicing
Compensation.
As
compensation for its services hereunder, the Servicer shall be entitled
to
withdraw from the Custodial Account or to retain from interest payments
on the
Mortgage Loans the amounts provided for as the Servicer's Servicing Fee.
Additional servicing compensation in the form of assumption fees, as provided
in
Section 6.01, late payment charges and other ancillary fees 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 therefor except as specifically provided for.
Section
6.04 Annual
Statement as to Compliance.
The
Servicer will deliver to the Owner not later than 90 days following the
end of
each fiscal year of the Servicer, an Officers' Certificate stating, as
to each
signatory thereof, 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 officers' 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 throughout such year, or, if there has
been a
default in the fulfillment of any such obligation, specifying each such
default
known to such officers and the nature and status thereof except for such
defaults as such Officers in their good faith judgment believe to be
immaterial.
Section
6.05 Annual
Independent Certified Public Accountants' Servicing Report.
Not
later
than 90 days following the end of each fiscal year of the Servicer, 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 the Owner to the effect that such firm has examined certain
documents and records relating to the Servicer's servicing of mortgage
loans of
the same type as the Mortgage Loans pursuant to servicing agreements
substantially similar to this Agreement, which agreements may include this
Agreement, and that, on the basis of such an examination, conducted
substantially in accordance with the Uniform Single Attestation Program
for
Mortgage Bankers, such firm is of the opinion that the Servicer's servicing
has
been conducted in compliance with the agreements examined pursuant to this
Section 6.05, except for (i) such exceptions as such firm shall believe
to be
immaterial, and (ii) such other exceptions as shall be set forth in such
statement.
Section
6.06 Owner's
Right to Examine Servicer Records.
The
Owner
shall have the right to examine and audit, at its expense, upon reasonable
notice to the Servicer, during business hours or at such other times as
might be
reasonable under applicable circumstances, any and all of the books, records,
documentation or other information of the Servicer, or held by another
for the
Servicer or on its behalf or otherwise, which relate to the performance
or
observance by the Servicer of the terms, covenants or conditions of this
Agreement.
The
Servicer shall provide to the Owner and any supervisory agents or examiners
representing a state or federal governmental agency having jurisdiction
over the
Owner, including but not limited to OTS, FDIC and other similar entities,
access
to any documentation regarding the Mortgage Loans in the possession of
the
Servicer which may be required by any applicable regulations. Such access
shall
be afforded without charge, upon reasonable request, during normal business
hours and at the offices of the Servicer, and in accordance with the applicable
federal government agency, FDIC, OTS, or any other similar
regulations.
Section
6.07 Compliance
with REMIC Provisions.
If
a
REMIC election has been made with respect to the arrangement under which
the
Mortgage Loans and REO Property are held, the Servicer shall not take any
action, cause the REMIC to take any action or fail to take (or fail to
cause to
be taken) any action that, under the REMIC Provisions, if taken or not
taken, as
the case may be could (i) endanger the status of the REMIC as a REMIC or
(ii)
result in the imposition of a tax upon the REMIC (including but not limited
to
the tax on “prohibited transactions” as defined in Section 860F(a)(2) of the
Code and the tax on “contribution” to a REMIC set forth in Section 860G(d) of
the Code unless the Servicer has received an Opinion of Counsel (at the
expense
of the party seeking to take such actions) to the effect that the contemplated
action will not endanger such REMIC status or result in the imposition
of any
such tax.
Section
6.08 Non-solicitation.
The
Servicer shall not knowingly conduct any solicitation exclusively targeted
to
the Mortgagors for the purpose of inducing or encouraging the early prepayment
or refinancing of the related Mortgage Loans. It is understood and agreed
that
promotions undertaken by the Servicer or any agent or affiliate of the
Servicer
which are directed to the general public at large, including, without
limitation, mass mailings based on commercially acquired mailing lists,
newspaper, radio and television advertisements shall not constitute solicitation
under this section. Nothing
contained herein shall prohibit the Servicer from (i) distributing to Mortgagors
any general advertising including information brochures, coupon books,
or other
similar documentation which indicates services the Seller offers, including
refinances or (ii) providing financing of home equity loans to Mortgagors
at the
Mortgagor’s request.
ARTICLE
VII
REPORTS
TO BE PREPARED BY SERVICER
Section
7.01 Servicer
Shall Provide Information as Reasonably Required.
The
Servicer shall furnish to the Owner upon request, during the term of this
Agreement, 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 purposes of this Agreement. The Servicer may negotiate with
the
Owner for a reasonable fee for providing such report or information, unless
(i)
the Servicer is required to supply such report or information pursuant
to any
other section of this Agreement, or (ii) the report or information has
been
requested in connection with Internal Revenue Service, OTS, FDIC or other
regulatory agency requirements. All such reports or information shall be
provided by and in accordance with all reasonable instructions and directions
given by the Owner. The
Servicer agrees to execute and deliver all such instruments and take all
such
action as the Owner, from time to time, may reasonably request in order
to
effectuate the purpose and to carry out the terms of this Agreement.
ARTICLE
VIII
THE
SERVICER
Section
8.01 Indemnification;
Third Party Claims.
The
Servicer agrees to indemnify the Owner and hold it harmless from and against
any
and all claims, losses, damages, penalties, fines, forfeitures, legal fees
and
related costs, judgments, and any other costs, fees and expenses that the
Owner
may sustain in any way related to the failure of the Servicer to perform
in any
way its duties and service the Mortgage Loans in strict compliance with
the
terms of this Agreement and for breach of any representation or warranty
of the
Servicer contained herein. The Servicer shall immediately notify the Owner
if a
claim is made by a third party with respect to this Agreement or the Mortgage
Loans, assume (with the consent of the Owner and with counsel reasonably
satisfactory to the Owner) the defense of any such claim and pay all expenses
in
connection therewith, including counsel fees, and promptly pay, discharge
and
satisfy any judgment or decree which may be entered against it or the Owner
in
respect of such claim but failure to so notify the Owner shall not limit
its
obligations hereunder. The Servicer agrees that it will not enter into
any
settlement of any such claim without the consent of the Owner unless such
settlement includes an unconditional release of the Owner from all liability
that is the subject matter of such claim. The provisions of this Section
8.01
shall survive termination of this Agreement. In no event will either Purchaser
or Seller be liable to the other party to this Agreement for incidental
or
consequential damages, including, without limitation, loss of profit or
loss of
business or business opportunity, regardless of the form of action whether
in
contract, tort or otherwise.
Section
8.02 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 any merger, conversion or consolidation to which the Servicer
shall be a party, or any Person succeeding to the business of the Servicer
whether or not related to loan servicing, 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 (i) having a GAAP net worth of not less than $25,000,000,
(ii)
the deposits of which are insured by the FDIC, SAIF and/or BIF, or which
is a
HUD-approved mortgagee whose primary business is in origination and servicing
of
first lien mortgage loans, and (iii) which is a Xxxxxx Mae or Xxxxxxx Mac
approved seller/servicer in good standing.
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Section
8.03 Limitation
on Liability of the Servicer and Others.
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Neither
the Servicer nor any of the officers, employees or agents of the Servicer
shall
be under any liability to the Owner 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 made in good faith; provided, however, that this provision
shall not
protect the Servicer or any such person against any breach of warranties
or
representations made herein, or failure to perform in any way its obligations
in
compliance with any standard of care set forth in this Agreement, or any
liability which would otherwise be imposed by reason of negligence or any
breach
of the terms and conditions of this Agreement. The Servicer and any 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 the Owner 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 expenses or liability; provided, however,
that the Servicer may, with the consent of the Owner, which consent shall
not be
unreasonably withheld, undertake any such action which it may deem necessary
or
desirable with respect to this Agreement and the rights and duties of the
parties hereto. In such event, the reasonable legal expenses and costs
of such
action and any liability resulting therefrom shall be expenses, costs and
liabilities for which the Owner will be liable, and the Servicer shall
be
entitled to be reimbursed therefor from the Owner upon written
demand.
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Section
8.04 Servicer
Not to Resign.
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The
Servicer shall not resign from the obligations and duties hereby imposed
on it
except by mutual consent of the Servicer and the Owner 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 Owner which Opinion of Counsel
shall be
in form and substance acceptable to the Owner. 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 11.01.
Section
8.05 No
Transfer of Servicing.
With
respect to the retention of the Servicer to service the Mortgage Loans
hereunder, the Servicer acknowledges that the Owner has acted in reliance
upon
the Servicer's independent status, the adequacy of its servicing facilities,
plan, personnel, records and procedures, its integrity, reputation and
financial
standing and the continuance thereof. Without in any way limiting the generality
of this section, the Servicer shall not either assign this Agreement or
the
servicing hereunder or delegate its rights or duties hereunder or any portion
thereof, or sell or otherwise dispose of all or substantially all of its
property or assets, without the prior written approval of the Owner, which
approval shall not be unreasonably withheld; provided that the Servicer
may
assign the Agreement and the servicing hereunder without the consent of
Owner to
an affiliate of the Servicer to which all servicing of the Servicer is
assigned
so long as (i) such affiliate is a Xxxxxx Xxx and Xxxxxxx Mac approved
servicer
and (ii) if it is intended that such affiliate be spun off to the shareholders
of the Servicer, such affiliate have a GAAP net worth of at least $10,000,000
and (iii) such affiliate shall deliver to the Owner a certification pursuant
to
which such affiliate shall agree to be bound by the terms and conditions
of this
Agreement and shall certify that such affiliate is a Xxxxxx Mae and Xxxxxxx
Mac
approved servicer in good standing.
ARTICLE
IX
DEFAULT
Section
9.01 Events
of Default.
In
case
one or more of the following Events of Default by the Servicer shall occur
and
be continuing, that is to say:
(i) any
failure by the Servicer to remit to the Owner any payment required to be
made
under the terms of this Agreement which continues unremedied for a period
of
three (3) Business Days after written notice thereof
(it
being understood that this subparagraph shall not affect Servicer's obligation
pursuant to Section 5.01 to pay default interest on any remittance received
by
the Owner after the Business Day on which such payment was due); or
(ii) any
failure on the part of 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, the breach of which has a material adverse effect
and
which continue unremedied for a period of sixty 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 and such
failure
shall be deemed to have a material adverse effect) 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 Owner; or
(iii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
bankruptcy, readjustment of debt, marshaling of assets and liabilities
or
similar proceedings, or 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 sixty days;
or
(iv) 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
(v) 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
(vi) the
Servicer ceases to be approved by either Xxxxxx Mae or Xxxxxxx Mac (to
the
extent such entities are then operating in a capacity similar to that in
which
they operate on the Closing Date) as a mortgage loan servicer for more
than
thirty days to the extent such entities perform similar functions;
or
(vii) the
Servicer attempts to assign its right to servicing compensation hereunder
or the
Servicer attempts, without the consent of the Owner, 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 except as otherwise permitted
herein.
then,
and
in each and every such case, so long as an Event of Default shall not have
been
remedied, the Owner, by notice in writing to the Servicer may, in addition
to
whatever rights the Owner may have under Section 8.01 and at law or equity
to
damages, including injunctive relief and specific performance, terminate
all the
rights and obligations of the Servicer under this Agreement and in and
to the
Mortgage Loans and the proceeds thereof without compensating the Servicer
for
the same. On or after the 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 11.01. Upon written request from the Owner,
the
Servicer shall prepare, execute and deliver, any and all documents and
other
instruments, place in such successor's possession all Servicing 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 Owner 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 the Custodial Account
or Escrow
Account or thereafter received with respect to the Mortgage Loans or any
REO
Property.
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Section
9.02 Waiver
of Defaults.
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The
Owner
may waive only by written notice 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
in writing.
ARTICLE
X
TERMINATION
Section
10.01 Termination.
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 Owner in writing; or (iii) termination
by the
Owner pursuant to Section 9.01. Simultaneously with any such termination
and the
transfer of servicing hereunder, the Servicer shall be entitled to be reimbursed
for any outstanding Servicing Advances and Monthly Advances.
Section
10.02 Removal
of Mortgage Loans from Inclusion under this Agreement upon a Whole
Loan
Transfer or a Pass-Through Transfer.
The
Servicer acknowledges and the Owner agrees that with respect to some or
all of
the Mortgage Loans, the Owner may effect either (1) one or more Whole Loan
Transfers, or (2) one or more Pass-Through Transfers.
The
Servicer shall cooperate with the Owner in connection with any Whole Loan
Transfer or Pass-Through Transfer contemplated by the Owner pursuant to
this
Section. In connection therewith, and without limitation, the Owner shall
deliver any reconstitution agreement or other document related to the Whole
Loan
Transfer or Pass-Through Transfer to the Servicer at least 15 days prior
to such
transfer (or 30 days if such transfer is to take place in March, June,
September
or December) and the Servicer shall execute any such reconstitution agreement
which contains provisions substantially similar to those herein or otherwise
reasonably acceptable to the Owner and the Servicer and which restates
the
representations and warranties contained in Article III as of the date
of
transfer (except to the extent any such representation or warranty is not
accurate on such date).
With
respect to each Whole Loan Transfer or Pass--Through Transfer, as the case
may
be, effected by the Owner, Owner (i) shall reimburse Servicer for all reasonable
out-of-pocket third party costs and expenses related thereto and (ii) shall
pay
Servicer a reasonable amount representing time and effort expended by Servicer
related thereto (which amount shall be reasonably agreed upon by Servicer
and
Owner prior to the expenditure of such time and effort); provided,
however,
that
for each Whole Loan Transfer and/or Pass--Through Transfer, the sum of
such
amounts described in subsections (i) and (ii) above shall in no event exceed
$5,000. For purposes of this paragraph, all Whole Loan Transfers and/or
Pass--Through Transfers made to the same entity within the same accounting
cycle
shall be considered one Whole Loan Transfer or Pass--Through
Transfer.
All
Mortgage Loans not sold or transferred pursuant to a Whole Loan Transfer
or
Pass-Through Transfer shall be subject to this Agreement and shall continue
to
be serviced in accordance with the terms of this Agreement and with respect
thereto this Agreement shall remain in full force and effect.
ARTICLE
XI
MISCELLANEOUS
PROVISIONS
Section
11.01 Successor
to the Servicer.
Prior
to
termination of the Servicer's responsibilities and duties under this Agreement
pursuant to Sections 8.04, 9.01 or 10.01(ii), the Owner shall (i) succeed
to and
assume all of the Servicer's responsibilities, rights, duties and obligations
under this Agreement, or (ii) appoint a successor having the characteristics
set
forth in Section 8.02 hereof and which shall succeed to all rights and
assume
all of the responsibilities, duties and liabilities of the Servicer under
this
Agreement prior to the termination of the Servicer's responsibilities,
duties
and liabilities under this Agreement. In connection with such appointment
and
assumption, the Owner may make such arrangements for the compensation of
such
successor out of payments on Mortgage Loans as the Owner and such successor
shall agree. In the event that the Servicer's duties, responsibilities
and
liabilities under this Agreement should be terminated pursuant to the
aforementioned sections, the Servicer shall discharge such duties and
responsibilities during the period from the date it acquires knowledge
of such
termination until the effective date thereof with the same degree of diligence
and prudence which it is obligated to exercise under this Agreement, and
shall
take no action whatsoever that might impair or prejudice the rights or
financial
condition of its successor. The resignation or removal of the Servicer
pursuant
to the aforementioned sections shall not become effective until a successor
shall be appointed pursuant to this section and shall in no event relieve
the
Servicer of the representations and warranties made pursuant to Article
III and
the remedies available to the Owner under Section 8.01, it being understood
and
agreed that the provisions of such Article III and Section 8.01 shall be
applicable to the Servicer notwithstanding any such resignation or termination
of the Servicer, or the termination of this Agreement.
Any
successor appointed as provided herein shall execute, acknowledge and deliver
to
the Servicer and to the Owner an instrument accepting such appointment,
whereupon such successor shall become fully vested with all the rights,
powers,
duties, responsibilities, obligations and liabilities of the Servicer,
with like
effect as if originally named as a party to this Agreement. Any termination
or
resignation of the Servicer or this Agreement pursuant to Section 8.04,
9.01 or
10.01 shall not affect any claims that the Owner may have against the Servicer
arising prior to any such termination or resignation.
The
Servicer shall promptly deliver to the successor the funds in the Custodial
Account and the Escrow Account and the Servicing Files and related documents
and
statements held by it hereunder and the Servicer shall account for all
funds.
The Servicer shall execute and deliver such instruments and do such other
things
all as may reasonably be required to more fully and definitely vest and
confirm
in the successor all such rights, powers, duties, responsibilities, obligations
and liabilities of the Servicer. The successor shall make such arrangements
as
it may deem appropriate to reimburse the Servicer for unrecovered Servicing
Advances which the successor retains hereunder and which would otherwise
have
been recovered by the Servicer pursuant to this Agreement but for the
appointment of the successor servicer.
Upon
a
successor's acceptance of appointment as such, the Servicer shall notify
the
Owner of such appointment.
Section
11.02 Amendment.
This
Agreement may be amended from time to time by the Servicer and the Owner
by
written agreement signed by the Servicer and the Owner.
Section
11.03 Recordation
of Agreement.
To
the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all the counties
or
other comparable jurisdictions in which any of all the properties subject
to the
Mortgages are situated, and in any other appropriate public recording office
or
elsewhere, such recordation to be effected by the Owner at the Owner's
expense
on direction of the Owner accompanied by an opinion of counsel to the effect
that such recordation materially and beneficially affects the interest
of the
Owner or is necessary for the administration or servicing the Mortgage
Loans.
Section
11.04 Governing
Law.
THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS
OF LAWS. THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section
11.05 Notices.
Any
demands, notices or other communications permitted or required hereunder
shall
be in writing and shall be deemed conclusively to have been given if personally
delivered at or mailed by registered mail, postage prepaid, and return
receipt
requested or transmitted by telecopier and confirmed by a similar mailed
writing, as follows:
(i) if
to the
Servicer:
000
Xxxxxxxxxx Xxxx
Xxxxxxx,
Xxxxxxxxxxxx 00000
Attention:
Xx. Xxxxx Xxxx
Telecopier
No.: (000) 000-0000
(ii) if
to the
Owner:
Mac
Xxxxxx Xxxxx XX,
000
Xxxxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxx,
Xxxxx 00000
Attention:
Xx. Xxxxxx Xxxxx
Telecopier
No.: (000) 000-0000
or
such
other address as may hereafter be furnished to the other party by like
notice.
Any such demand, notice, or communication hereunder shall be deemed to
have been
received on the date delivered to or received at the premises of the address
(as
evidenced, in the case of registered or certified mail, by the date noted
on the
return receipt).
Section
11.06 Severability
of Provisions.
Any
part,
provision, representation or warranty of this Agreement which is prohibited
or
which is held to be void or unenforceable shall be ineffective to the extent
of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation or warranty of this
Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall be ineffective, as to such jurisdiction,
to the extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or unenforceability
in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which
prohibits
or renders void or unenforceable any provision hereof. If the invalidity
of any
part, provision, representation or warranty of this Agreement shall deprive
any
party of the economic benefit intended to be conferred by this Agreement,
the
parties shall negotiate, in good faith, to develop a structure the economic
effect of which is nearly as possible the same as the economic effect of
this
Agreement without regard to such invalidity.
Section
11.07 Exhibits.
The
exhibits to this Agreement are hereby incorporated and made a part hereof
and
are an integral part of this Agreement.
Section
11.08 General
Interpretive Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
(i) the
terms
defined in this Agreement have the meanings assigned to them in this Agreement
and include the plural as well as the singular, and the use of any gender
herein
shall be deemed to include the other gender;
(ii) accounting
terms not otherwise defined herein have the meanings assigned to them in
accordance with generally accepted accounting principles;
(iii) references
herein to "Articles," "Sections," "Subsections," "Paragraphs," and other
subdivisions without reference to a document are to designated Articles,
Sections, Subsections, Paragraphs and other subdivisions of this
Agreement;
(iv) a
reference to a Subsection without further reference to a Section is a reference
to such Subsection as contained in the same Section in which the reference
appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(v) the
words
"herein," "hereof," "hereunder" and other words of similar import refer
to this
Agreement as a whole and not to any particular provision; and
(vi) the
term
"include" or "including" shall mean without limitation by reason of
enumeration.
Section
11.09 Reproduction
of Documents.
This
Agreement and all documents relating hereto, including, without limitation,
(i)
consents, waivers and modifications which may hereafter be executed, (ii)
documents received by any party at the closing, and (iii) financial statements,
certificates and other information previously or hereafter furnished, may
be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in
any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in
evidence.
Section
11.10 Confidentiality
of Information.
Each
party recognizes that, in connection with this Agreement, it may become
privy to
non-public information regarding the financial condition, operations and
prospects of the other party. Except as required to be disclosed by law,
each
party agrees to keep all non-public information regarding the other party
strictly confidential, and to use all such information solely in order
to
effectuate the purpose of this Agreement.
Section
11.11 Recordation
of Assignments of Mortgage.
To
the
extent permitted by applicable law, each of the Assignments of Mortgage
is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which
any or
all of the Mortgaged Properties are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by
the
Servicer at the Owner's expense.
Section
11.12 Assignment
by the Owner.
The
Owner
shall have the right, without the consent of the Servicer hereof, 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
Owner hereunder, by executing an assignment and assumption agreement reasonably
acceptable to the Servicer and the assignee or designee shall accede to
the
rights and obligations hereunder of the Owner with respect to such Mortgage
Loans. In no event shall Owner sell a partial interest in any Mortgage
Loan. All
references to the Owner in this Agreement shall be deemed to include its
assignees or designees. It is understood and agreed between the Owners
and the
Servicer that no more than five (5) Persons shall have the right of owner
under
this Agreement at any one time.
Section
11.13 No
Partnership.
Nothing
herein contained shall be deemed or construed to create a co-partnership
or
joint venture between the parties hereto and the services of the Servicer
shall
be rendered as an independent contractor and not as agent for
Owner.
Section
11.14 Execution;
Successors and Assigns.
This
Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed,
shall
be deemed to be an original; such counterparts, together, shall constitute
one
and the same agreement. Subject to Section 8.04, this Agreement shall inure
to
the benefit of and be binding upon the Servicer and the Owner and their
respective successors and assigns.
Section
11.15 Entire
Agreement.
Each
of
the Servicer and the Owner acknowledge that no representations, agreements
or
promises were made to it by the other party or any of its employees other
than
those representations, agreements or promises specifically contained herein.
This Agreement sets forth the entire understanding between the parties
hereto
and shall be binding upon all successors of both parties.
IN
WITNESS WHEREOF, the Servicer and the Owner have caused their names to
be signed
hereto by their respective officers thereunto duly authorized as of the
date and
year first above written.
GMAC
MORTGAGE CORPORATION
Servicer
By:
________________________________________
Name:
Title:
EMC
MORTGAGE CORPORATION
Owner
By:
________________________________________
EXHIBIT
A
MORTGAGE
LOAN SCHEDULE
EXHIBIT
B
CUSTODIAL
ACCOUNT LETTER AGREEMENT
(date)
To:______________________
_________________________
_________________________
(the
"Depository")
As
"Servicer" under the Servicing Agreement, dated as of ,
(the
"Agreement"), we hereby authorize and request you to establish an account,
as a
Custodial Account pursuant to Section 4.04 of the Agreement, to be designated
as
"[Servicer] Custodial Account, in trust for [Owner], Owner of Whole Loan
Mortgages, 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.
By:____________________
Name:__________________
Title:___________________
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 up to applicable limits by the Federal Deposit Insurance Corporation
through the Bank Insurance Fund or the Savings Association Insurance Fund
or
will be invested in Permitted Investments as defined in the
Agreement.
[
]
(name
of
Depository)
By:____________________
Name:__________________
Title:___________________
EXHIBIT
C
ESCROW
ACCOUNT LETTER AGREEMENT
(date)
To:___________________________
______________________________
______________________________
(the
"Depository")
As
"Servicer" under the Servicing Agreement, dated as of
(the
"Agreement"), we hereby authorize and request you to establish an account,
as an
Escrow Account pursuant to Section 4.06 of the Agreement, to be designated
as
"[Servicer] Escrow Account, in trust for [Owner], Owner of Whole Loan Mortgages,
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.
By:____________________
Name:__________________
Title:___________________
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 up to applicable limits by the Federal Deposit Insurance Corporation
through the Bank Insurance Fund or the Savings Association Insurance Fund
or
will be invested in Permitted Investments as defined in the
Agreement.
[
]
(name
of
Depository)
By:____________________
Name:__________________
Title:___________________
EXHIBIT
D
REQUEST
FOR RELEASE
EXHIBIT
E
LOAN
LEVEL SCHEDULED-SCHEDULED
REMITTANCE
TAPE LAYOUT
Amendment
No. 1 to the Servicing Agreement
This
is
Amendment No. 1 dated October 1, 2001 to that certain Servicing Agreement
(the
“Agreement”) dated
as
of May 1, 2001 between
EMC MORTGAGE CORPORATION, as Owner
and
GMAC MORTGAGE CORPORATION, as Servicer.
W
I T N E
S S E T H :
WHEREAS,
the Owner is the owner of the Mortgage Loans and the Servicer is the servicer
of
the Mortgage Loans; and
WHEREAS,
the Owner and the Servicer wish to amend the Agreement;
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of
which is
hereby acknowledged, the Purchaser and the Seller agree that the following
amendment shall be made to the Agreement:
(a)
The
following shall replace (i)(a), (b) and (c) in the first paragraph of Section
5.01:
“(i)
all
amounts credited to the Custodial Account as of the close of business on
the
related preceding Determination Date, except Principal Prepayments received
on
or after the first day of the month in which the Remittance Date occurs
shall be
remitted to the Owner on the next following Remittance Date,”
(b)
Capitalized terms used herein and not defined shall have the meanings set
forth
in the Agreement.
(c)
THIS
AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS
OF LAWS. THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
(d)
Except as such amendments are made herein, the Agreement shall remain in
full
force and effect.
[SIGNATURES
COMMENCE ON THE FOLLOWING PAGE]
IN
WITNESS WHEREOF, the Owner and the Servicer have caused their names to
be signed
hereto by their respective officers thereunto duly authorized as of the
day and
year first above written.
|
EMC
MORTGAGE CORPORATION
Owner
|
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By:
|
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Name:
|
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Title:
|
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GMAC
MORTGAGE CORPORATION
Servicer
|
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By:
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Name:
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Title:
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Amendment
No. 2 to the Servicing Agreement
This
is
Amendment No. 1 dated July 31, 2002 to that certain Servicing Agreement
(the
“Agreement”) dated
as
of May 1, 2001 between
EMC MORTGAGE CORPORATION, as Owner
and
GMAC MORTGAGE CORPORATION, as Servicer.
W
I T N E
S S E T H :
WHEREAS,
the Owner is the owner of the Mortgage Loans and the Servicer is the servicer
of
the Mortgage Loans; and
WHEREAS,
the Owner and the Servicer wish to amend the Agreement;
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of
which is
hereby acknowledged, the Purchaser and the Seller agree that the following
amendment shall be made to the Agreement:
(a) The
definition of “Permitted Investments” in Section 1.01 of the Agreement is
amended by deleting (viii) in such definition.
(b)
Capitalized terms used herein and not defined shall have the meanings set
forth
in the Agreement.
(c)
THIS
AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS
OF LAWS. THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
(d)
Except as such amendments are made herein, the Agreement shall remain in
full
force and effect.
[SIGNATURES
COMMENCE ON THE FOLLOWING PAGE]
IN
WITNESS WHEREOF, the Owner and the Servicer have caused their names to
be signed
hereto by their respective officers thereunto duly authorized as of the
day and
year first above written.
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EMC
MORTGAGE CORPORATION
Owner
|
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By:
|
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Name:
|
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Title:
|
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GMAC
MORTGAGE CORPORATION
Servicer
|
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By:
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Name:
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Title:
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EXHIBIT
S-2
ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT
This
Assignment, Assumption and Recognition Agreement (this “AAR Agreement”) is made
and entered into as of August 30, 2006 (the “Closing Date”), among EMC Mortgage
Corporation (the “Assignor”), Citibank, N.A., not individually but solely as
trustee for the holders of SACO I Trust 2006-9, Mortgage Pass-Through
Certificates, Series 2006-9 (the “Assignee”) and GMAC Mortgage Corporation (the
“Company”).
Whereas,
the Assignor purchased mortgage loans from the Company (the “Mortgage Loans”)
pursuant to that certain Mortgage Loan Purchase Agreement, dated as of
February
1, 2005, between the Assignor and the Company (the “MLPA”) and that certain
Assignment, Assumption and Recognition Agreement dated June 29, 2006 between
the
Assignor, the Company and Residential Funding Corporation (the “Assignment
Agreement”, together with the MLPA, the “Purchase Agreement”);
Whereas,
the Assignor and the Company entered into that certain Servicing Agreement,
dated as of May 1, 2001, as amended by Amendment No. 1, dated as of October
1,
2001, Amendment No. 2, dated as of July 31, 2002 and Amendment No. 3, dated
as
of December 20, 2005 (as amended, the “Servicing Agreement”), pursuant to which
the Company agreed to service the Mortgage Loans.
In
consideration of the mutual promises and agreements contained herein, and
for
other good and valuable consideration, the receipt and sufficiency of which
are
hereby acknowledged, the parties hereto agree that the Mortgage Loans listed
on
Attachment
1
annexed
hereto (the “Assigned Loans”) shall be subject to the terms of this AAR
Agreement. Any capitalized term used and not otherwise defined herein shall
have
the meaning assigned to such term in the Servicing Agreement.
Assignment
and Assumption
1. Except
as
expressly provided for herein, the Assignor hereby grants, transfers and
assigns
to the Assignee all of its right, title and interest in, to and under (a)
the
Assigned Loans and (b) as it relates to the Assigned Loans, the Servicing
Agreement. Notwithstanding anything to the contrary contained herein, the
Assignor is not assigning to the Assignee any of its right, title and interest
in, to and under the Servicing Agreement with respect to any other mortgage
loan
other than the Assigned Loans. Except as is otherwise expressly provided
herein,
the Assignor makes no representations, warranties or covenants to the Assignee
and the Assignee acknowledges that the Assignor has no obligations to the
Assignee under the terms of the Servicing Agreement or otherwise relating
to the
transaction contemplated herein (including, but not limited to, any obligation
to indemnify the Assignee).
Assignor
acknowledges and agrees that upon execution of this AAR Agreement, the
Assignee
shall become the “Owner” under the Servicing Agreement, and all representations,
warranties and covenants by the “Servicer” to the “Owner” under the Servicing
Agreement including, but not limited to, the rights to receive indemnification,
shall accrue to Assignee by virtue of this AAR Agreement.
Representations,
Warranties and Covenants
2. Assignor
warrants and represents to, and covenants with, Assignee and Company as
of the
date hereof that:
| a. |
Attached
hereto as Attachment
2
is
a true and correct copy of the Servicing Agreement, which Servicing
Agreement is in full force and effect as of the date hereof and
the
provisions of which have not been waived, amended or modified
in any
respect, nor has any notice of termination been given
thereunder;
|
| b. |
Assignor
is the lawful owner of the Assigned Loans with full right to
transfer the
Assigned Loans and any and all of its interests, rights and obligations
under the Servicing Agreement as they relate to the Assigned
Loans, free
and clear from any and all claims and encumbrances; and upon
the transfer
of the Assigned Loans to Assignee as contemplated herein, Assignee
shall
have good title to each and every Assigned Loan, as well as any
and all of
Assignee’s interests, rights and obligations under the Servicing Agreement
as they relate to the Assigned Loans, free and clear of any and
all liens,
claims and encumbrances;
|
| c. |
There
are no offsets, counterclaims or other defenses available to
the Company
with respect to the Assigned Loans, the Purchase Agreement or
the
Servicing Agreement;
|
| d. |
Assignor
has no knowledge of, and has not received notice of, any waivers
under, or
any modification of, any Assigned
Loan;
|
| e. |
Assignor
is duly organized, validly existing and in good standing under
the laws of
the jurisdiction of its incorporation, and has all requisite
power and
authority to acquire, own and sell the Assigned
Loans;
|
| f. |
Assignor
has full corporate power and authority to execute, deliver and
perform its
obligations under this AAR Agreement, and to consummate the transactions
set forth herein. The consummation of the transactions contemplated
by
this AAR Agreement is in the ordinary course of Assignor’s business and
will not conflict with, or result in a breach of, any of the
terms,
conditions or provisions of Assignor’s charter or by-laws or any legal
restriction, or any material agreement or instrument to which
Assignor is
now a party or by which it is bound, or result in the violation
of any
law, rule, regulation, order, judgment or decree to which Assignor
or its
property is subject. The execution, delivery and performance
by Assignor
of this AAR Agreement and the consummation by it of the transactions
contemplated hereby, have been duly authorized by all necessary
corporate
action on part of Assignor. This AAR Agreement has been duly
executed and
delivered by Assignor and, upon the due authorization, execution
and
delivery by Assignee and the parties hereto, will constitute
the valid and
legally binding obligation of Assignor enforceable against Assignor
in
accordance with its terms except as enforceability may be limited
by
bankruptcy, reorganization, insolvency, moratorium or other similar
laws
now or hereafter in effect relating to creditors’ rights generally, and by
general principles of equity regardless of whether enforceability
is
considered in a proceeding in equity or at law;
and
|
| g. |
No
consent, approval, order or authorization of, or declaration,
filing or
registration with, any governmental entity is required to be
obtained or
made by Assignor in connection with the execution, delivery or
performance
by Assignor of this AAR Agreement, or the consummation by it
of the
transactions contemplated hereby. Neither Assignor nor anyone
acting on
its behalf has offered, transferred, pledged, sold or otherwise
disposed
of the Assigned Loans or any interest in the Assigned Loans,
or solicited
any offer to buy or accept a transfer, pledge or other disposition
of the
Assigned Loans, or any interest in the Assigned Loans or otherwise
approached or negotiated with respect to the Assigned Loans,
or any
interest in the Assigned Loans with any Person in any manner,
or made any
general solicitation by means of general advertising or in any
other
manner, or taken any other action which would constitute a distribution
of
the Assigned Loans under the Securities Act of 1933, as amended
(the “1933
Act”)
or
which would render the disposition of the Assigned Loans a violation
of
Section 5 of the 1933 Act or require registration pursuant
thereto.
|
3. The
Assignee warrants and represents to, and covenants with, the Assignor and
the
Company as of the date hereof that:
| a. |
Assignee
is duly organized, validly existing and in good standing under
the laws of
the jurisdiction of its organization and has all requisite power
and
authority to hold the Assigned Loans as trustee on behalf of
the holders
of SACO I Trust 2006-9, Mortgage Pass-Through Certificates, Series
2006-9;
|
| b. |
Assignee
has full corporate power and authority to execute, deliver and
perform
under this AAR Agreement, and to consummate the transactions
set forth
herein. The consummation of the transactions contemplated by
this AAR
Agreement is in the ordinary course of Assignee’s business and will not
conflict with, or result in a breach of, any of the terms, conditions
or
provisions of Assignee’s charter or by-laws or any legal restriction, or
any material agreement or instrument to which Assignee is now
a party or
by which it is bound, or result in the violation of any law,
rule,
regulation, order, judgment or decree to which Assignee or its
property is
subject. The execution, delivery and performance by Assignee
of this AAR
Agreement and the consummation by it of the transactions contemplated
hereby, have been duly authorized by all necessary corporate
action on
part of Assignee. This AAR Agreement has been duly executed and
delivered
by Assignee and, upon the due authorization, execution and delivery
by
Assignor and the parties hereto, will constitute the valid and
legally
binding obligation of Assignee enforceable against Assignee in
accordance
with its terms except as enforceability may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws
now or
hereafter in effect relating to creditors’ rights generally, and by
general principles of equity regardless of whether enforceability
is
considered in a proceeding in equity or at
law;
|
| c. |
No
consent, approval, order or authorization of, or declaration,
filing or
registration with, any governmental entity is required to be
obtained or
made by Assignee in connection with the execution, delivery or
performance
by Assignee of this AAR Agreement, or the consummation by it
of the
transactions contemplated hereby; and
|
| d. |
The
Assignee assumes all of the rights of the Owner under the Servicing
Agreement with respect to the Assigned Loans other than the right
to
enforce the obligations of the Servicer under the Servicing
Agreement.
|
4. Company
warrants and represents to, and covenants with, Assignee and Assignor,
as of the
date hereof, that:
| a. |
Attached
hereto as Attachment
2
is
a true and correct copy of the Servicing Agreement, which agreement
is in
full force and effect as of the date hereof and the provisions
of which
have not been waived, amended or modified in any respect, nor
has any
notice of termination been given
thereunder;
|
| b. |
Company
is duly organized, validly existing and in good standing under
the laws of
the jurisdiction of its incorporation, and has all requisite
power and
authority to service the Assigned Loans and otherwise to perform
its
obligations under the Servicing
Agreement;
|
| c. |
Company
has full corporate power and authority to execute, deliver and
perform its
obligations under this AAR Agreement, and to consummate the transactions
set forth herein. The consummation of the transactions contemplated
by
this AAR Agreement is in the ordinary course of Company’s business and
will not conflict with, or result in a breach of, any of the
terms,
conditions or provisions of Company’s articles of incorporation or any
legal restriction, or any material agreement or instrument to
which
Company is now a party or by which it is bound, or result in
the violation
of any law, rule, regulation, order, judgment or decree to which
Company
or its property is subject. The execution, delivery and performance
by
Company of this AAR Agreement and the consummation by it of the
transactions contemplated hereby, have been duly authorized by
all
necessary corporate action on part of Company. This AAR Agreement
has been
duly executed and delivered by Company, and, upon the due authorization,
execution and delivery by Assignor and Assignee, will constitute
the valid
and legally binding obligation of Company, enforceable against
Company in
accordance with its terms except as enforceability may be limited
by
bankruptcy, reorganization, insolvency, moratorium or other sim |
