Exhibit 99.3
EXECUTION COPY
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GSAA HOME EQUITY TRUST 2006-8
ASSET-BACKED CERTIFICATES
SERIES 2006-8
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
among
XXXXXXX XXXXX MORTGAGE COMPANY,
as Assignor
GS MORTGAGE SECURITIES CORP.,
as Assignee
and
AVELO MORTGAGE, L.L.C.
as Servicer
Dated as of
April 28, 2006
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ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT, dated April 28,
2006 (this "Agreement"), among Xxxxxxx Sachs Mortgage Company ("Assignor"), GS
Mortgage Securities Corp. ("Assignee") and Avelo Mortgage, L.L.C. ( the
"Company").
For and in consideration of the mutual promises contained herein and
other good and valuable consideration the receipt and sufficiency of which are
hereby acknowledged, and of the mutual covenants herein contained, the parties
hereto hereby agree as follows:
1. Assignment, Assumption and Conveyance.
The Assignor hereby conveys, sells, grants, transfers and assigns to
the Assignee all of the right, title and interest (other than those rights
specifically retained by the Assignor pursuant to this Agreement) of the
Assignor, as purchaser, in, to and under (a) those certain Xxxxxxx Xxxxx
Residential Mortgage Conduit Program mortgage loans (the "Conduit Mortgage
Loans") and those certain First National Bank of Nevada mortgage loans (the
"FNBN Mortgage Loans") listed on the schedule (the "Mortgage Loan Schedule")
attached hereto as Exhibit A (together, the "Mortgage Loans"), and (b) solely
insofar as it relates to the Mortgage Loans, that certain Flow Servicing
Agreement, dated as of January 1, 2006 (the "Servicing Agreement"), by and
between the Assignor, as owner (the "Owner") and the Company. The Assignor
hereby agrees that it will (i) deliver possession of notes evidencing the
Mortgage Loans to, or at the direction of, the Assignee or its designee and
(ii) take in a timely manner all necessary steps under all applicable laws to
convey and to perfect the conveyance of the Mortgage Loans as required under
the Trust Agreement (as defined below).
The Assignor specifically reserves and does not assign to the
Assignee hereunder (i) any and all right, title and interest in, to and under
and any obligations of the Assignor with respect to any mortgage loans subject
to the Servicing Agreement that are not the Mortgage Loans set forth on the
Mortgage Loan Schedule and are not the subject of this Agreement, (ii) any
rights and obligations of the Assignor pursuant to the Servicing Agreement
arising prior to the date hereof or (iii) the rights and obligations of the
Owner under the following sections of the Servicing Agreement: Section 6.02
(relating to the Owner's right to terminate the Company) and Section 5.01
(relating to the Owner's right to receive information from the Servicer).
The Assignee hereby assumes all of the Assignor's obligations under
the Mortgage Loans and the Servicing Agreement solely insofar as such
obligations relate to the Mortgage Loans, other than the obligations set forth
in clauses (ii) and (iii) of the preceding paragraph.
The parties hereto agree that with respect to the Mortgage Loans
being serviced under the Servicing Agreement the Servicing Fee Rate for the
Mortgage Loans shall be the rate set forth on the Mortgage Loan Schedule.
2. Recognition of the Company.
From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer
the Mortgage Loans and assign its rights under the Servicing Agreement (solely
to the extent set forth herein) and this Agreement to Deutsche Bank National
Trust Company ("Deutsche Bank"), as trustee (including its successors in
interest and any successor trustees under the Trust Agreement, the "Trustee"),
of the GSAA Home Equity Trust 2006-8 (the "Trust") created pursuant to a
Master Servicing and Trust Agreement, dated as of April 1, 2006 (the "Trust
Agreement"), among the Assignee, the Trustee, Deutsche Bank, as a custodian,
U.S. Bank National Association, as a custodian, JPMorgan Chase Bank, National
Association, as a custodian and Xxxxx Fargo Bank, N.A., as master servicer
(including its successors in interest and any successor servicer under the
Trust Agreement, the "Master Servicer"), securities administrator and as a
custodian. The Company hereby acknowledges and agrees that from and after the
date hereof (i) the Trust will be the owner of the Mortgage Loans and the
Company will be the servicer of the Mortgage Loans on or after the applicable
Transfer Date pursuant to the terms set forth in the Trust Agreement, (ii) the
Company shall look solely to the Trust (including the Trustee and the Master
Servicer acting on the Trust's behalf) for performance of any obligations of
the Assignor under the Mortgage Loans and the Servicing Agreement (solely
insofar as it relates to the Mortgage Loans) (except for such obligations of
the Assignor retained by the Assignor hereunder), (iii) the Trust (including
the Trustee and the Master Servicer acting on the Trust's behalf) shall have
all the rights and remedies available to the Assignor, insofar as they relate
to the Mortgage Loans, under the applicable purchase agreement pursuant to
which the Owner purchased the related Mortgage Loans from the related Seller
and the Servicing Agreement, including, without limitation, the enforcement of
the document delivery requirements set forth in Section 5(b) of the related
purchase agreement, and shall be entitled to enforce all of the obligations of
the Company thereunder insofar as they relate to the Mortgage Loans, including
without limitation, the remedies for breaches of representations and
warranties set forth in Article IX of the Servicing Agreement (except for the
rights and remedies retained by the Assignor hereunder), (iv) all references
to the Owner under the Servicing Agreement insofar as they relate to the
Mortgage Loans shall be deemed to refer to the Trust (except to the extent of
the rights and obligations retained by the Assignor hereunder) (including the
Trustee and the Servicer acting on the Trust's behalf) and (v) the Mortgage
Loans will be part of a REMIC, and the Company shall service the Mortgage
Loans and any real property acquired upon default thereof (including, without
limitation, making or permitting any modification, waiver or amendment of any
term of any Mortgage Loan) after the applicable Transfer Date in accordance
with the Servicing Agreement but in no event in a manner that would (A) cause
the REMIC to fail to qualify as a REMIC or (B) 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, the tax on
contributions to a REMIC set forth in Section 860G(d) of the Code, and the tax
on "net income from foreclosure property" as set forth in Section 860G(c) of
the Code). Neither the Company nor the Assignor shall amend or agree to amend,
modify, waive, or otherwise alter any of the terms or provisions of the
Servicing Agreement which amendment, modification, waiver or other alteration
would in any way affect the Mortgage Loans or the Company's performance under
the Servicing Agreement with respect to the Mortgage Loans without the prior
written consent of the Master Servicer.
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3. Modification of the Servicing Agreement. Only in so far as it
relates to the Mortgage Loans, the Servicer and the Assignor hereby amend the
Servicing Agreement as follows:
(a) The definition of "Servicing Fee Rate" set forth in Article I
shall be deleted in its entirety and replaced with the following:
"Servicing Fee Rate: With respect to each Mortgage Loan, 0.25% per
annum."
(b) Section 2.05 shall be amended as follows:
(i) "and" shall be deleted from the end of subsection (vii);
(ii) subsection (viii) shall be amended by deleting the "."
at the end of subsection (viii) and replacing it with "; and"
(iii) a new subsection (ix) shall be added to Section 2.05
immediately following subsection (viii) which shall read as follows:
"(ix) to reimburse itself for Monthly Advances of the Servicer's
funds made pursuant to Section 3.04, the Servicer's right to reimburse itself
pursuant to this subclause (ix) being limited to related Liquidation Proceeds,
Condemnation Proceeds, Insurance Proceeds and such other amounts as may be
collected by the Servicer from the Mortgagor or otherwise relating to the
Mortgage Loan, including amounts received on the related Mortgage Loan which
represent late payments of principal and/or interest respecting which any such
advance was made, it being understood that, in the case of any such
reimbursement, the Servicer's right thereto shall be prior to the rights of
Purchaser."
(c) the third paragraph of Section 2.18 shall be deleted and
replaced as follows:
"The Servicer shall use its best efforts to dispose of the REO
Property as soon as possible and shall sell such REO Property in any event
within one year after title has been taken to such REO Property, unless (i) a
REMIC election has not been made with respect to the arrangement under which
the Mortgage Loans and the REO Property are held, and (ii) the Servicer
determines, and gives an appropriate notice to the Purchaser to such effect,
that a longer period is necessary for the orderly liquidation of such REO
Property; provided however, that the Servicer agrees not to sell or dispose of
any such Mortgage Loan to a person who acquires such Mortgage Loan using a
purchase money mortgage. If a period longer than one year is permitted under
the foregoing sentence and is necessary to sell any REO Property, the Servicer
shall report monthly to the Purchaser as to the progress being made in selling
such REO Property, and provided further, that if the Servicer is unable to
sell such REO Property within three years of acquisition, the Servicer shall
obtain an extension from the Internal Revenue Service."
(d) the third paragraph of Section 3.01 shall be deleted and
replaced as follows:
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"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 three 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 the payment was due and ending with the Business Day on which such
payment is made, both inclusive. Such interest shall be remitted along with
the distribution payable on the next succeeding Remittance Date. The payment
by the Servicer of any such interest shall not be deemed an extension of time
for payment or a waiver of any Event of Default by the Servicer."
(e) Section 3.04 will be amended by adding a new paragraph as
follows:
"In the event that the Servicer determines that any such advances are
non-recoverable, the Servicer shall provide the Owner with a certificate
signed by an officer of the Servicer evidencing such determination.
Notwithstanding the foregoing, the Servicer shall not be permitted to make any
advances from amounts held for future distribution, and instead shall be
required to make all advances from its own funds, unless the Servicer, its
parent, or their respective successors hereunder shall have a long term credit
rating of at least "A" by Fitch, Inc., or the equivalent rating of another
Rating Agency."
(f) a new section, Section 11.17, will be added immediately
following Section 11.16 which shall read as follows:
"Section 11.17 Third-Party Beneficiary. Xxxxx Fargo Bank, N.A., as
master servicer, securities administrator and as a custodian under the Master
Servicing and Trust Agreement, dated as of April 1, 2006, among GS Mortgage
Securities Corp., Deutsche Bank National Trust Company, as trustee and a
custodian, U.S. Bank National Association, as a custodian, Xxxxx Fargo Bank,
N.A., as a custodian and JPMorgan Chase Bank, National Association, as
custodian, shall be considered a third-party beneficiary to this Agreement
entitled to all of the rights and benefits accruing to it as if it were a
direct party to this Agreement."
4. Representations and Warranties of the Company.
The Company warrants and represents to and covenants with, the
Assignor, the Assignee and the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its formation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Servicing Agreement. The
execution by the Company of this Agreement is in the ordinary course of
the Company's business and will not conflict with, or result in a breach
of, any of the terms, conditions or provisions of the Company's
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charter or bylaws or any legal restriction, or any material agreement or
instrument to which the Company is now a party or by which it is bound,
or result in the violation of any law, rule, regulation, order, judgment
or decree to which the Company or its property is subject. The execution,
delivery and performance by the Company of this Agreement have been duly
authorized by all necessary corporate action on part of the Company. This
Agreement has been duly executed and delivered by the Company, and, upon
the due authorization, execution and delivery by the Assignor and the
Assignee, will constitute the valid and legally binding obligation of the
Company, enforceable against the Company in accordance with its terms
except as enforceability may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and by general principles of
equity regardless of whether enforceability is considered in a proceeding
in equity or at law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be
obtained or made by the Company in connection with the execution,
delivery or performance by the Company of this Agreement or the
consummation by it of the transaction contemplated hereby;
(d) The Company shall establish a Custodial Account and an Escrow
Account under the Servicing Agreement in favor of the Trust with respect
to the Mortgage Loans separate from the Custodial Account and Escrow
Account previously established under the Servicing Agreement in favor of
the Assignor;
(e) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency
or other tribunal, which would draw into question the validity of this
Agreement or the Servicing Agreement, or which, either in any one
instance or in the aggregate, is likely to result in any material adverse
change in the ability of the Company to perform its obligations under
this Agreement or the Servicing Agreement, and the Company is solvent;
(f) The Company has serviced the Mortgage Loans in accordance with
the Servicing Agreement and has provided accurate "paid through" data
(assuming the correctness of all "paid through" data provided by the
Assignor to the Company at the time the Company began servicing the
Mortgage Loans) with respect to the Mortgage Loans to the Assignor;
(g) Except as reflected in the "paid through" data delivered to the
Assignor (assuming the correctness of all "paid through" data provided by
the Assignor to the Company at the time the Company began servicing the
Mortgage Loans), there is no payment default existing under any Mortgage
or any Mortgage Note as of the Securitization Closing Date; and
(h) To the Company's knowledge, there is no non-payment default
existing under any Mortgage or Mortgage Note, or any event which, with
the passage of time or with notice and the termination of any grace or
cure period, would constitute a non-
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payment default, breach, violation or event which would permit
acceleration as of the Securitization Closing Date.
Pursuant to Section 9.01 of the Servicing Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that the representations and warranties set forth in Article IX
of the Servicing Agreement are true and correct as of the date hereof as if
such representations and warranties were made on the date hereof.
5. Representations and Warranties of the Assignor.
The Assignor warrants and represents to the Assignee and the Trust as
of date hereof that:
(a) Prior Assignments; Pledges. Except for the sale to the Assignee,
the Assignor has not assigned or pledged any Mortgage Note or the related
Mortgage or any interest or participation therein;
(b) Releases. The Assignor has not satisfied, canceled or
subordinated in whole or in part, or rescinded any Mortgage, and the
Assignor has not released the related Mortgaged Property from the lien of
any Mortgage, in whole or in part, nor has the Assignor executed an
instrument that would effect any such release, cancellation,
subordination, or rescission. The Assignor has not released any
Mortgagor, in whole or in part, except in connection with an assumption
agreement or other agreement approved by the related federal insurer, to
the extent such approval was required;
(c) No Waiver. The Assignor has not waived the performance by any
Mortgagor of any action, if such 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 such
Mortgagor;
(d) Compliance with Applicable Laws. With respect to each Mortgage
Loan, 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, predatory and abusive lending or disclosure laws applicable
to such Mortgage Loan, including without limitation, any provisions
relating to prepayment charges, have been complied with;
(e) High Cost. With respect to the Mortgage Loans, no Mortgage Loan
is categorized as "High Cost" pursuant to the then-current Standard &
Poor's Glossary for File Format for LEVELS(R) Version 5.6(d), Appendix E,
as revised from time to time and in effect as of the Original Purchase
Date. Furthermore, none of the Mortgage Loans sold by the Seller are
classified as (a) a "high cost mortgage" loan under the Home Ownership
and Equity Protection Act of 1994 or (b) a "high cost home," "covered,"
"high-cost," "high-risk home," or "predatory" loan under any other
applicable state, federal or local law;
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(f) Georgia Fair Lending Act. No Mortgage Loan is secured by a
property in the state of Georgia and originated between October 1, 2002
and March 7, 2003;
(g) Qualified Mortgage Loan. Each Mortgage Loan is a "qualified
mortgage" under Section 860G(a)(3) of the Internal Revenue Code of 1986,
as amended; and
(h) Credit Reporting. The Assignor will cause to be fully furnished,
in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (i.e., favorable and
unfavorable) on Mortgagor credit files to Equifax, Experian and Trans
Union Credit Information Company (three of the credit repositories), on a
monthly basis; and
(i) Prepayment Premiums. To the Assignor's knowledge, with respect to
any Mortgage Loan that contains a provision permitting imposition of a
Prepayment Premium prior to maturity: (a) prior to the Mortgage 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;
(b) prior to the Mortgage Loan's origination, the borrower was offered
the option of obtaining a Mortgage Loan that did not require payment of
such a premium; (c) the prepayment premium is adequately disclosed to the
borrower pursuant to applicable state and federal law; (d) no Mortgage
Loan originated on or after October 1, 2002 will impose a prepayment
premium for a term in excess of three (3) years and any Mortgage Loans
originated prior to such date will not impose Prepayment Premiums in
excess of five years; in each case unless the Mortgage Loan was modified
to reduce the prepayment period to no more than three years from the date
of the note and the borrower was notified in writing of such reduction in
prepayment period; and (e) notwithstanding any state or federal law to
the contrary, the Servicer shall not impose such Prepayment Premium in
any instance when the Mortgage Loan is accelerated or paid off in
connection with the workout of a delinquent mortgage or due to the
borrower's default.
6. Remedies for Breach of Representations and Warranties of the
Assignor.
With respect to the Conduit Mortgage Loans, the Assignor hereby
acknowledges and agrees that in the event of any breach of the representations
and warranties made by the Assignor set forth in Section 5 hereof or in
Section 2 of the Representations and Warranties Agreement, dated as of April
28, 2006, between the Assignor and Assignee (the "Representations and
Warranties Agreement") that materially and adversely affects the value of the
Mortgage Loans or the interest of the Assignee or the Trust therein, within
sixty (60) days of the earlier of either discovery by or notice to the
Assignor of such breach of a representation or warranty, it shall cure,
purchase, cause the purchase of, or substitute for the applicable Mortgage
Loan in the same manner and subject to the conditions set forth in Section 3
of the Representations and Warranties Agreement.
With respect to the FNBN Mortgage Loans, the Assignor hereby
acknowledges and agrees that in the event of any breach of representations and
warranties made by the Assignor set forth in Section 5 hereof or in Sections 6
and 7 of the Assignment, Assumption and Recognition Agreement, dated as of
April 28, 2006, between the Assignor, the Assignee and First National Bank of
Nevada (the "FNBN Assignment Agreement"), the Assignor shall
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repurchase such affected FNBN Mortgage Loans as set forth in the FNBN
Assignment Agreement and in the related Servicing Agreement.
7. Miscellaneous.
(a) This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and
the obligations, rights and remedies of the parties hereunder shall be
determined in accordance with such laws.
(b) No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party
against whom such waiver or modification is sought to be enforced, with
the prior written consent of the Trustee.
(c) This Agreement shall inure to the benefit of (i) the successors
and assigns of the parties hereto and (ii) the Trust (including the
Trustee and the Master Servicer acting on the Trust's behalf). Any entity
into which the Assignor, Assignee or the Company may be merged or
consolidated shall, without the requirement for any further writing, be
deemed Assignor, Assignee or the Company, respectively, hereunder.
(d) Each of this Agreement and the Servicing Agreement shall survive
the conveyance of the Mortgage Loans to the Trust and the assignment of
the purchase agreements and the Servicing Agreement (to the extent
assigned hereunder) by the Assignor to the Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms
of the purchase agreements and the Servicing Agreement.
(e) This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all
such counterparts shall constitute one and the same instrument.
(f) In the event that any provision of this Agreement conflicts with
any provision of the purchase agreements or the Servicing Agreement with
respect to the Mortgage Loans, the terms of this Agreement shall control.
(g) Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given
to such terms in the purchase agreements or the Servicing Agreement, as
applicable.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
GS MORTGAGE SECURITIES CORP.
By: /s/ Xxxxxxxx Xxxx
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Name: Xxxxxxxx Xxxx
Title: Vice President
XXXXXXX XXXXX MORTGAGE COMPANY
By: XXXXXXX SACHS REAL ESTATE FUNDING
CORP., its General Partner
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx
Title: Managing Director
AVELO MORTGAGE, L.L.C. (Servicer)
By: /s/ Xxxxxxx Xxxxxx
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Name: Xxxxxxx Xxxxxx
Title: Vice President
Conduit/Avelo Step 1 AAR
EXHIBIT A
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Mortgage Loan Schedule
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[On File with the Securities Administrator as provided by the Depositor]
A-1
