EXHIBIT 4
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XXXXXX XXXXXXX ABS CAPITAL I INC.,
Depositor,
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
Master Servicer and Securities Administrator,
SAXON MORTGAGE SERVICES, INC.,
Servicer,
NATIXIS REAL ESTATE CAPITAL INC.,
Unaffiliated Seller,
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
Trustee and Custodian
POOLING AND SERVICING AGREEMENT
NATIXIS REAL ESTATE CAPITAL TRUST 2007-HE2
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2007-HE2
Dated as of April 1, 2007
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS.................................................
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES..................................................
Section 2.01 Conveyance of Mortgage Loans................................
Section 2.02 Acceptance by the Custodian of the Mortgage Loans...........
Section 2.03 Representations, Warranties and Covenants of the
Unaffiliated Seller and the Servicer........................
Section 2.04 The Depositor and the Mortgage Loans........................
Section 2.05 Delivery of Opinion of Counsel or Officer's Certificate
in Connection with Substitutions and Non-Qualified
Mortgages...................................................
Section 2.06 Execution and Delivery of Certificates......................
Section 2.07 REMIC Matters...............................................
Section 2.08 Representations and Warranties of the Depositor.............
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS..............
Section 3.01 Servicer to Service Mortgage Loans..........................
Section 3.02 Subservicing Agreements Between the Servicer and
Subservicers................................................
Section 3.03 Successor Subservicers......................................
Section 3.04 Liability of the Servicer...................................
Section 3.05 No Contractual Relationship Between Subservicers and the
Trustee.....................................................
Section 3.06 Assumption or Termination of Subservicing Agreements by
Master Servicer.............................................
Section 3.07 Collection of Certain Mortgage Loan Payments;
Establishment of Certain Accounts...........................
Section 3.08 Subservicing Accounts.......................................
Section 3.09 Collection of Taxes, Assessments and Similar Items;
Escrow Accounts.............................................
Section 3.10 Collection Accounts.........................................
Section 3.11 Withdrawals from the Collection Account.....................
Section 3.12 Investment of Funds in the Accounts.........................
Section 3.13 Maintenance of Hazard Insurance and Errors and Omissions
and Fidelity Coverage.......................................
Section 3.14 Enforcement of Due-On-Sale Clauses Assumption Agreements....
Section 3.15 Realization Upon Defaulted Mortgage Loans...................
Section 3.16 Release of Mortgage Files...................................
Section 3.17 Title, Conservation and Disposition of REO Property.........
Section 3.18 Notification of Adjustments.................................
Section 3.19 Access to Certain Documentation and Information
Regarding the Mortgage Loans................................
Section 3.20 Documents, Records and Funds in Possession of the
Servicer to be Held for the Securities Administrator........
Section 3.21 Servicing Compensation......................................
Section 3.22 Annual Statement as to Compliance...........................
Section 3.23 Annual Independent Public Accountants' Servicing
Statement; Financial Statements.............................
Section 3.24 Master Servicer to Act as Servicer..........................
Section 3.25 Compensating Interest.......................................
Section 3.26 Credit Reporting; Xxxxx-Xxxxx-Xxxxxx Act....................
ARTICLE IV
DISTRIBUTIONS AND ADVANCES BY THE SERVICER..................
Section 4.01 Advances....................................................
Section 4.02 Priorities of Distribution..................................
Section 4.03 Monthly Statements to Certificateholders....................
Section 4.04 Certain Matters Relating to the Determination of LIBOR......
Section 4.05 [Reserved]..................................................
Section 4.06 [Reserved]..................................................
Section 4.07 Allocation of Applied Realized Loss Amounts.................
ARTICLE V
THE CERTIFICATES............................................
Section 5.01 The Certificates............................................
Section 5.02 Certificate Register; Registration of Transfer and
Exchange of Certificates....................................
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates...........
Section 5.04 Persons Deemed Owners.......................................
Section 5.05 Access to List of Certificateholders' Names and
Addresses...................................................
Section 5.06 Maintenance of Office or Agency.............................
ARTICLE VI
THE DEPOSITOR AND THE SERVICER..............................
Section 6.01 Respective Liabilities of the Depositor and the Servicer....
Section 6.02 Merger or Consolidation of the Depositor or the Servicer....
Section 6.03 Limitation on Liability of the Depositor, the Servicer
and Others..................................................
Section 6.04 Limitation on Resignation of the Servicer...................
Section 6.05 Additional Indemnification by the Servicer; Third Party
Claims......................................................
ARTICLE VII
DEFAULT.....................................................
Section 7.01 Events of Default...........................................
Section 7.02 Master Servicer to Act; Appointment of Successor............
Section 7.03 Notification to Certificateholders..........................
ARTICLE VIII
CONCERNING THE TRUSTEE......................................
Section 8.01 Duties of the Trustee.......................................
Section 8.02 Certain Matters Affecting the Trustee and the Custodian.....
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.......
Section 8.04 Trustee May Own Certificates................................
Section 8.05 Trustee's and Custodian's Fees and Expenses.................
Section 8.06 Eligibility Requirements for the Trustee....................
Section 8.07 Resignation and Removal of the Trustee......................
Section 8.08 Successor Trustee...........................................
Section 8.09 Merger or Consolidation of the Trustee......................
Section 8.10 Appointment of Co-Trustee or Separate Trustee...............
Section 8.11 Tax Matters.................................................
Section 8.12 Periodic Filings............................................
Section 8.13 Tax Treatment of Upper-Tier CarryForward Amounts, Basis
Risk CarryForward Amounts and Class IO Shortfalls; Tax
Classification of the Supplemental Interest Trust,
Excess Reserve Fund Account, Swap Account and the
Interest Rate Swap Agreement................................
Section 8.14 Interest Rate Swap Agreement................................
Section 8.15 Interest Rate Cap Agreement.................................
ARTICLE IX
ADMINISTRATION OF THE MORTGAGE LOANS BY THE MASTER
SERVICER....................................................
Section 9.01 Duties of the Master Servicer; Enforcement of the
Servicer's Obligations......................................
Section 9.02 Maintenance of Fidelity Bond and Errors and Omissions
Insurance...................................................
Section 9.03 Representations and Warranties of the Master Servicer.......
Section 9.04 Master Servicer Events of Default...........................
Section 9.05 Waiver of Default...........................................
Section 9.06 Successor to the Master Servicer............................
Section 9.07 Compensation of the Master Servicer.........................
Section 9.08 Merger or Consolidation.....................................
Section 9.09 Resignation of the Master Servicer..........................
Section 9.10 Assignment or Delegation of Duties by the Master
Servicer....................................................
Section 9.11 Limitation on Liability of the Master Servicer..............
Section 9.12 Indemnification; Third Party Claims.........................
ARTICLE X
CONCERNING THE SECURITIES ADMINISTRATOR.....................
Section 10.01 Duties of Securities Administrator..........................
Section 10.02 Certain Matters Affecting the Securities Administrator......
Section 10.03 Securities Administrator Not Liable for Certificates or
Mortgage Loans..............................................
Section 10.04 Securities Administrator May Own Certificates...............
Section 10.05 Securities Administrator's Fees and Expenses................
Section 10.06 Eligibility Requirements for Securities Administrator.......
Section 10.07 Resignation and Removal of Securities Administrator.........
Section 10.08 Successor Securities Administrator..........................
Section 10.09 Merger or Consolidation of Securities Administrator.........
Section 10.10 Assignment or Delegation of Duties by the Securities
Administrator...............................................
ARTICLE XI
TERMINATION.................................................
Section 11.01 Termination upon Liquidation or Purchase of the 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; Sales; Advance Facilities.......................
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 [Reserved]..................................................
Section 12.12 Third Party Beneficiary.....................................
Section 12.13 Waiver of Jury Trial........................................
Section 12.14 Regulation AB Compliance; Intent of the Parties;
Reasonableness..............................................
SCHEDULES
Schedule I Mortgage Loan Schedule
Schedule II [Reserved]
Schedule III Representations and Warranties of Saxon
Schedule IIIA Further Representations and Warranties of Saxon
Schedule IV Representations and Warranties as to the Unaffiliated Seller
EXHIBITS
Exhibit A Form of Class A-1, Class X-0, Xxxxx X-0, Class A-4, Class M-1,
Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class B-1,
Class B-2 and Class B-3
Exhibit B Form of Class B-4 Certificate
Exhibit C Form of Class P Certificate
Exhibit D-1 Form of Class R Certificate
Exhibit D-2 Form of Class RX Certificate
Exhibit E Form of Class X Certificate
Exhibit F Form of Initial Certification of Custodian
Exhibit G Form of Final Certification of Custodian
Exhibit H Form of Residual Transfer Affidavit
Exhibit I Form of Transferor Certificate
Exhibit J Form of Rule 144A Letter
Exhibit K Form of Request for Release
Exhibit L Contents of Each Mortgage File
Exhibit M Form of Subsequent Transfer Agreement
Exhibit N Form of Certification to be provided with Form 10-K
Exhibit O Form of Annual Certification to be Provided to the Master Servicer
Exhibit P Form of Servicer Power of Attorney
Exhibit Q Servicing Criteria - To be Addressed in Assessment of Compliance
Exhibit R Additional Form 10-D Disclosure
Exhibit S Additional Form 10-K Disclosure
Exhibit T Form 8-K Disclosure Information
Exhibit U Form of Additional Disclosure Notification
Exhibit V Form of Servicer Report
Exhibit W Standard File Layout - Delinquency Reporting
Exhibit X Interest Rate Swap Agreement
Exhibit Y Interest Rate Cap Agreement
Exhibit Z [Reserved]
Exhibit AA [Reserved]
Exhibit BB Accredited Agreements
Exhibit CC CIT Agreements
Exhibit DD First Horizon Agreements
Exhibit EE First NLC Agreements
Exhibit FF FlexPoint Agreements
Exhibit GG Funding America Agreements
Exhibit HH Lenders Direct Agreements
Exhibit II Lime Financial Agreements
Exhibit JJ Mandalay Agreements
Exhibit KK Master Financial Agreements
Exhibit LL Maxim Agreements
Exhibit MM NC Capital Agreements
Exhibit NN Platinum Agreements
Exhibit OO Rose Agreements
Exhibit PP Unaffiliated Seller's Agreement
THIS POOLING AND SERVICING AGREEMENT, dated as of April 1, 2007,
among XXXXXX XXXXXXX ABS CAPITAL I INC., a Delaware corporation, as depositor
(the "Depositor"), XXXXX FARGO BANK, NATIONAL ASSOCIATION, a banking association
organized under the laws of the United States, as master servicer and securities
administrator (in each such capacity, respectively, the "Master Servicer" and
the "Securities Administrator"), SAXON MORTGAGE SERVICES, INC., a Texas
corporation ("Saxon" or the "Servicer"), NATIXIS REAL ESTATE CAPITAL INC., a New
York corporation, as unaffiliated seller (the "Unaffiliated Seller") and
DEUTSCHE BANK NATIONAL TRUST COMPANY, a national banking association, as trustee
and custodian (in each such capacity respectively, the "Trustee" and the
"Custodian").
W I T N E S S E T H:
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Securities Administrator, on behalf of the Trust shall elect
that six segregated asset pools within the Trust Fund (exclusive of (i) the
Prepayment Premiums, (ii) the Swap Assets, (iii) the Excess Reserve Fund
Account, (iv) the Pre-Funding Account and the Pre-Funding Reserve Account, (v)
the Capitalized Interest Account and (vi) the right of the LIBOR Certificates to
receive Basis Risk Carry Forward Amounts and, without duplication, Upper-Tier
Carry Forward Amounts and the obligation to pay Class IO Shortfalls) be treated
for federal income tax purposes as comprising six REMICs (REMIC PF, Pooling-Tier
REMIC-1, Pooling-Tier REMIC-2, the Lower-Tier REMIC, the Upper-Tier REMIC and
the Class X REMIC, respectively, and each, a "Trust REMIC"). The Class X
Interest, Class IO Interest, Class PFIO Interest and each Class of LIBOR
Certificates (other than the right of each Class of LIBOR Certificates to
receive Basis Risk Carry Forward Amounts and, without duplication, Upper-Tier
Carry Forward Amounts and the obligation to pay Class IO Shortfalls) represents
ownership of a regular interest in a REMIC for purposes of the REMIC Provisions.
The Class R Certificates represent ownership of the sole class of residual
interest in each of REMIC PF, Pooling-Tier REMIC-1, Pooling-Tier REMIC-2, the
Lower-Tier REMIC and the Upper-Tier REMIC for purposes of the REMIC Provisions.
The Class RX Certificates represent ownership of the sole class of residual
interest in the Class X REMIC for purposes of the REMIC provisions. The Startup
Day for each Trust REMIC described herein is the date referenced in Section
2.07. The latest possible maturity date for each class of regular interests is
the latest date referenced in Section 2.07. The Class X REMIC shall hold as
assets the Class UT-X Interest, the Class UT-PFIO Interest and the Class UT-IO
Interest. The Upper-Tier REMIC shall hold as assets the several classes of
uncertificated Lower-Tier Regular Interests. The Lower-Tier REMIC shall hold as
assets the several classes of uncertificated Pooling-Tier REMIC-2 Regular
Interests. Pooling-Tier REMIC-2 shall hold as assets the several classes of
uncertificated Pooling-Tier REMIC-1 Regular Interests. Pooling-Tier REMIC-1
shall hold as assets the several classes of uncertificated REMIC PF Regular
Interests. REMIC PF shall hold as assets the assets of the Trust Fund (exclusive
of (i) the Prepayment Premiums, (ii) the Swap Assets, (iii) the Excess Reserve
Fund Account, (iv) the Pre-Funding Account and the Pre-Funding Reserve Account,
(v) the Capitalized Interest Account and (vi) the right of the LIBOR
Certificates to receive Basis Risk Carry Forward Amounts and, without
duplication, Upper-Tier Carry Forward Amounts and the obligation to pay Class IO
Shortfalls).
For federal income tax purposes, each Class of LIBOR Certificates
represents a beneficial ownership of a regular interest in the Upper-Tier REMIC,
the right to receive Basis Risk Carry Forward Amounts and without duplication,
Upper-Tier Carry Forward Amounts, and the obligation to pay Class IO Shortfalls;
the Class X Certificates represent beneficial ownership of the Class X Interest,
the Class IO Interest, Class PFIO Interest, the Interest Rate Swap Agreement,
the Swap Account, the Excess Reserve Fund Account and the right to receive Class
IO Shortfalls, subject to the obligation to pay Basis Risk Carry Forward Amounts
and, without duplication, Upper-Tier Carry Forward Amounts; the Class P
Certificates represent beneficial ownership of the Prepayment Premiums; and the
Unaffiliated Seller shall be the beneficial owner of the Pre-Funding Account,
the Pre-Funding Reserve Account and the Capitalized Interest Account, which
portions of the Trust Fund shall be treated as a grantor trust under subpart E,
Part I of subchapter J of the Code (the "Grantor Trust").
REMIC PF
REMIC PF shall issue the following interests in REMIC PF, and each
such interest (other than the Class PF-R Interest) is hereby designated as a
regular interest in REMIC PF (the "REMIC PF Regular Interests"). REMIC PF shall
also issue the Class PF-R Interest, which is hereby designated as the sole class
of residual interest in REMIC PF. The Class PF-R Interest shall be represented
by the Class R Certificates, shall not have a principal balance and shall have
no interest rate.
Initial REMIC PF
Principal Amount
REMIC PF Interest REMIC PF Interest Rate or Notional Amount
----------------- ---------------------- ------------------
Class PF-A (1) $749,910,572
Class PF-B (2) $165,089,428
Class PF-IO (3) (4)
Class PF-R (5) (5)
------------
(1) For any Distribution Date (and the related Interest Accrual Period), this
REMIC PF Regular Interest shall bear interest at a per annum rate (its
"REMIC-PF Interest Rate") equal to the REMIC PF WAC Rate.
(2) This REMIC PF Regular Interest shall bear interest at a per annum rate
(its "REMIC-PF Interest Rate") (i) for the first three Distribution Dates
(and the related Interest Accrual Periods), 0.00% and (ii) thereafter, a
per annum rate equal to the REMIC PF WAC Rate.
(3) This REMIC PF Regular Interest shall bear interest at a per annum rate
(its "REMIC-PF Interest Rate") (i) for the first three Distribution Dates
and the related Interest Accrual Periods, all interest on the Subsequent
Mortgage Loans for such Distribution Date divided by $165,089,428 and (ii)
thereafter, 0.00%.
(4) The Class PF-IO Interest will have a notional amount equal to the REMIC PF
Principal Amount of the Class PF-B Interest.
(5) The Class PF-R Interest is the sole class of residual interest in REMIC
PF. The Class PF-R Interest does not have a principal amount or an
interest rate.
On each of the first three Distribution Dates, Realized Losses,
Subsequent Recoveries and payments of principal in respect of the Initial
Mortgage Loans shall be allocated to the PF-A Interest, until the REMIC PF
Principal Amount of such interest is reduced to zero. On each of the first three
Distribution Dates, Realized Losses, Subsequent Recoveries and payments of
principal in respect of the Subsequent Mortgage Loans (including amounts paid as
principal from the Pre-Funding Account) shall be allocated to the Class PF-B
Interest, until the REMIC PF Principal Amount of such interest is reduced to
zero. On each Distribution Date thereafter, Realized Losses, Subsequent
Recoveries and payments of principal in respect of the Mortgage Loans shall be
allocated, pro rata, to the Class PF-A and Class PF-B Interests, until the REMIC
PF Principal Amount of such REMIC PF Regular Interests are reduced to zero.
Pooling-Tier REMIC-1
Pooling-Tier REMIC-1 shall issue the following interests in
Pooling-Tier REMIC-1, and each such interest, other than the Class PT1-R
Interest is hereby designated as a regular interest in the Pooling-Tier REMIC-1.
Pooling-Tier REMIC-1 shall also issue the Class PT1-R Interest, which is hereby
designated as the sole class of residual interest in Pooling-Tier REMIC-1. The
Class PT1-R Interest shall be represented by the Class R Certificates, shall not
have a principal balance and shall have no interest rate.
Initial Pooling-
Pooling-Tier REMIC-1 Tier REMIC-1
Pooling-Tier REMIC-1 Interest Interest Rate Principal Amount
----------------------------- ------------- ----------------
Class PT1-1 (1) $324,140,897.94
Class PT1-2A (2) $ 12,604,245.61
Class PT1-2B (3) $ 12,604,245.61
Class PT1-3A (2) $ 12,115,684.12
Class PT1-3B (3) $ 12,115,684.12
Class PT1-4A (2) $ 11,627,318.64
Class PT1-4B (3) $ 11,627,318.64
Class PT1-5A (2) $ 11,161,451.67
Class PT1-5B (3) $ 11,161,451.67
Class PT1-6A (2) $ 10,679,501.69
Class PT1-6B (3) $ 10,679,501.69
Class PT1-7A (2) $ 10,206,366.78
Class PT1-7B (3) $ 10,206,366.78
Class PT1-8A (2) $ 10,534,739.78
Class PT1-8B (3) $ 10,534,739.78
Class PT1-9A (2) $ 9,414,628.17
Class PT1-9B (3) $ 9,414,628.17
Class PT1-10A (2) $ 11,195,748.30
Class PT1-10B (3) $ 11,195,748.30
Class PT1-11A (2) $ 35,013,613.51
Class PT1-11B (3) $ 35,013,613.51
Class PT1-12A (2) $ 10,288,307.54
Class PT1-12B (3) $ 10,288,307.54
Class PT1-13A (2) $ 10,876,867.60
Class PT1-13B (3) $ 10,876,867.60
Class PT1-14A (2) $ 9,092,978.32
Class PT1-14B (3) $ 9,092,978.32
Class PT1-15A (2) $ 5,917,536.66
Class PT1-15B (3) $ 5,917,536.66
Class PT1-16A (2) $ 7,785,786.71
Class PT1-16B (3) $ 7,785,786.71
Class PT1-17A (2) $ 31,929,400.67
Class PT1-17B (3) $ 31,929,400.67
Class PT1-18A (2) $ 7,009,177.66
Class PT1-18B (3) $ 7,009,177.66
Class PT1-19A (2) $ 7,780,614.91
Class PT1-19B (3) $ 7,780,614.91
Class PT1-20A (2) $ 5,756,333.03
Class PT1-20B (3) $ 5,756,333.03
Class PT1-21A (2) $ 2,984,410.95
Class PT1-21B (3) $ 2,984,410.95
Class PT1-22A (2) $ 4,080,269.13
Class PT1-22B (3) $ 4,080,269.13
Class PT1-23A (2) $ 18,460,568.75
Class PT1-23B (3) $ 18,460,568.75
Class PT1-24A (2) $ 5,437,317.41
Class PT1-24B (3) $ 5,437,317.41
Class PT1-25A (2) $ 4,174,763.98
Class PT1-25B (3) $ 4,174,763.98
Class PT1-26A (2) $ 2,706,892.16
Class PT1-26B (3) $ 2,706,892.16
Class PT1-27A (2) $ 1,303,376.27
Class PT1-27B (3) $ 1,303,376.27
Class PT1-28A (2) $ 1,112,546.49
Class PT1-28B (3) $ 1,112,546.49
Class PT1-29A (2) $ 1,642,127.19
Class PT1-29B (3) $ 1,642,127.19
Class PT1-30A (2) $ 2,791,817.86
Class PT1-30B (3) $ 2,791,817.86
Class PT1-31A (2) $ 1,008,617.13
Class PT1-31B (3) $ 1,008,617.13
Class PT1-32A (2) $ 892,437.84
Class PT1-32B (3) $ 892,437.84
Class PT1-33A (2) $ 790,567.49
Class PT1-33B (3) $ 790,567.49
Class PT1-34A (2) $ 652,339.62
Class PT1-34B (3) $ 652,339.62
Class PT1-35A (2) $ 1,007,511.68
Class PT1-35B (3) $ 1,007,511.68
Class PT1-36A (2) $ 1,665,991.35
Class PT1-36B (3) $ 1,665,991.35
Class PT1-37A (2) $ 641,603.55
Class PT1-37B (3) $ 641,603.55
Class PT1-38A (2) $ 578,758.09
Class PT1-38B (3) $ 578,758.09
Class PT1-39A (2) $ 518,882.75
Class PT1-39B (3) $ 518,882.75
Class PT1-40A (2) $ 420,635.54
Class PT1-40B (3) $ 420,635.54
Class PT1-41A (2) $ 402,522.84
Class PT1-41B (3) $ 402,522.84
Class PT1-42A (2) $ 388,024.30
Class PT1-42B (3) $ 388,024.30
Class PT1-43A (2) $ 374,676.32
Class PT1-43B (3) $ 374,676.32
Class PT1-44A (2) $ 361,782.53
Class PT1-44B (3) $ 361,782.53
Class PT1-45A (2) $ 349,324.80
Class PT1-45B (3) $ 349,324.80
Class PT1-46A (2) $ 337,294.13
Class PT1-46B (3) $ 337,294.13
Class PT1-47A (2) $ 350,281.80
Class PT1-47B (3) $ 350,281.80
Class PT1-48A (2) $ 349,819.48
Class PT1-48B (3) $ 349,819.48
Class PT1-49A (2) $ 325,366.04
Class PT1-49B (3) $ 325,366.04
Class PT1-50A (2) $ 297,882.57
Class PT1-50B (3) $ 297,882.57
Class PT1-51A (2) $ 283,450.83
Class PT1-51B (3) $ 283,450.83
Class PT1-52A (2) $ 271,124.52
Class PT1-52B (3) $ 271,124.52
Class PT1-53A (2) $ 285,193.80
Class PT1-53B (3) $ 285,193.80
Class PT1-54A (2) $ 286,968.71
Class PT1-54B (3) $ 286,968.71
Class PT1-55A (2) $ 264,473.45
Class PT1-55B (3) $ 264,473.45
Class PT1-56A (2) $ 238,884.74
Class PT1-56B (3) $ 238,884.74
Class PT1-57A (2) $ 226,443.73
Class PT1-57B (3) $ 226,443.73
Class PT1-58A (2) $ 216,062.12
Class PT1-58B (3) $ 216,062.12
Class PT1-59A (2) $ 221,304.66
Class PT1-59B (3) $ 221,304.66
Class PT1-60A (2) $ 220,255.35
Class PT1-60B (3) $ 220,255.35
Class PT1-61A (2) $ 5,516,677.84
Class PT1-61B (3) $ 5,516,677.84
Class PT1-PFIO (4) N/A
Class PT1-R (5) (5)
------------
(1) For any Distribution Date (and the related Interest Accrual Period), this
Pooling-Tier REMIC-1 Regular Interest shall bear interest at a per annum
rate (its "Pooling-Tier REMIC-1 Interest Rate") equal to the Pooling-Tier
REMIC-1 WAC Rate.
(2) For any Distribution Date (and the related Interest Accrual Period), this
Pooling-Tier REMIC-1 Regular Interest shall bear interest at a per annum
rate (its "Pooling-Tier REMIC-1 Interest Rate") equal to the product of
(i) 2 and (ii) the Pooling-Tier REMIC-1 WAC Rate, subject to a maximum
rate of 9.74%.
(3) For any Distribution Date (and the related Interest Accrual Period), this
Pooling-Tier REMIC-1 Regular Interest shall bear interest at a per annum
rate (its "Pooling-Tier REMIC-1 Interest Rate") equal to the excess, if
any, of (A) the product of (i) 2 and (ii) the Pooling-Tier REMIC-1 WAC
Rate over (B) 9.74%.
(4) This Pooling Tier REMIC-1 Regular Interest is an interest-only interest
and does not have a Pooling-Tier REMIC-1 Principal Amount. On each
Distribution Date, this Pooling-Tier REMIC-1 Regular Interest shall be
entitled to receive all interest distributable on the Class PF-IO
Interest.
(5) The Class PT1-R Interest shall not have a principal balance and shall not
bear interest.
On each Distribution Date, Realized Losses, Subsequent Recoveries
and payments of principal in respect of the Mortgage Loans (including, for the
first three Distribution Dates only, amounts paid as principal from the
Pre-Funding Account) shall be allocated to the outstanding Pooling-Tier REMIC-1
Regular Interest relating to the Mortgage Loans with the lowest numerical
denomination until the Pooling-Tier REMIC-1 Principal Amount of such interest is
reduced to zero, provided that, with respect to Pooling-Tier REMIC-1 Regular
Interests with the same numerical denomination, such Realized Losses, Subsequent
Recoveries and payments of principal shall be allocated pro rata between such
Pooling-Tier REMIC-1 Regular Interests, until the Pooling-Tier REMIC-1 Principal
Amount of such interests is reduced to zero.
Pooling-Tier REMIC-2
Pooling-Tier REMIC-2 shall issue the following interests in
Pooling-Tier REMIC-2, and each such interest, other than the Class PT2-R
Interest, is hereby designated as a regular interest in Pooling-Tier REMIC-2.
The Class PT2-R Interest is hereby designated as the sole class of residual
interest in Pooling-Tier REMIC-2 and shall be represented by the Class R
Certificates.
Corresponding Corresponding Corresponding
Pooling-Tier Pooling-Tier Pooling-Tier Pooling-Tier Scheduled
Pooling-Tier REMIC-2 REMIC-2 Initial REMIC-2 IO REMIC-1 Regular Crossover
REMIC-2 Interest Interest Rate Principal Amount Interest Interest Distribution Date
---------------- ------------- ---------------- -------------- ---------------- -----------------
Class PT2-1 (1) $ 324,140,897.94 N/A N/A N/A
Class PT2-2A (2) $ 12,604,245.61 Class PT2-IO-2 N/A N/A
Class PT2-2B (3) $ 12,604,245.61 N/A N/A N/A
Class PT2-3A (2) $ 12,115,684.12 Class PT2-IO-3 N/A N/A
Class PT2-3B (3) $ 12,115,684.12 N/A N/A N/A
Class PT2-4A (2) $ 11,627,318.64 Class PT2-IO-4 N/A N/A
Class PT2-4B (3) $ 11,627,318.64 N/A N/A N/A
Class PT2-5A (2) $ 11,161,451.67 Class PT2-IO-5 N/A N/A
Class PT2-5B (3) $ 11,161,451.67 N/A N/A N/A
Class PT2-6A (2) $ 10,679,501.69 Class PT2-IO-6 N/A N/A
Class PT2-6B (3) $ 10,679,501.69 N/A N/A N/A
Class PT2-7A (2) $ 10,206,366.78 Class PT2-IO-7 N/A N/A
Class PT2-7B (3) $ 10,206,366.78 N/A N/A N/A
Class PT2-8A (2) $ 10,534,739.78 Class PT2-IO-8 N/A N/A
Class PT2-8B (3) $ 10,534,739.78 N/A N/A N/A
Class PT2-9A (2) $ 9,414,628.17 Class PT2-IO-9 N/A N/A
Class PT2-9B (3) $ 9,414,628.17 N/A N/A N/A
Class PT2-10A (2) $ 11,195,748.30 Class PT2-IO-10 N/A N/A
Class PT2-10B (3) $ 11,195,748.30 N/A N/A N/A
Class PT2-11A (2) $ 35,013,613.51 Class PT2-IO-11 N/A N/A
Class PT2-11B (3) $ 35,013,613.51 N/A N/A N/A
Class PT2-12A (2) $ 10,288,307.54 Class PT2-IO-12 N/A N/A
Class PT2-12B (3) $ 10,288,307.54 N/A N/A N/A
Class PT2-13A (2) $ 10,876,867.60 Class PT2-IO-13 N/A N/A
Class PT2-13B (3) $ 10,876,867.60 N/A N/A N/A
Class PT2-14A (2) $ 9,092,978.32 Class PT2-IO-14 N/A N/A
Class PT2-14B (3) $ 9,092,978.32 N/A N/A N/A
Class PT2-15A (2) $ 5,917,536.66 Class PT2-IO-15 N/A N/A
Class PT2-15B (3) $ 5,917,536.66 N/A N/A N/A
Class PT2-16A (2) $ 7,785,786.71 Class PT2-IO-16 N/A N/A
Class PT2-16B (3) $ 7,785,786.71 N/A N/A N/A
Class PT2-17A (2) $ 31,929,400.67 Class PT2-IO-17 N/A N/A
Class PT2-17B (3) $ 31,929,400.67 N/A N/A N/A
Class PT2-18A (2) $ 7,009,177.66 Class PT2-IO-18 N/A N/A
Class PT2-18B (3) $ 7,009,177.66 N/A N/A N/A
Class PT2-19A (2) $ 7,780,614.91 Class PT2-IO-19 N/A N/A
Class PT2-19B (3) $ 7,780,614.91 N/A N/A N/A
Class PT2-20A (2) $ 5,756,333.03 Class PT2-IO-20 N/A N/A
Class PT2-20B (3) $ 5,756,333.03 N/A N/A N/A
Class PT2-21A (2) $ 2,984,410.95 Class PT2-IO-21 N/A N/A
Class PT2-21B (3) $ 2,984,410.95 N/A N/A N/A
Class PT2-22A (2) $ 4,080,269.13 Class PT2-IO-22 N/A N/A
Class PT2-22B (3) $ 4,080,269.13 N/A N/A N/A
Class PT2-23A (2) $ 18,460,568.75 Class PT2-IO-23 N/A N/A
Class PT2-23B (3) $ 18,460,568.75 N/A N/A N/A
Class PT2-24A (2) $ 5,437,317.41 Class PT2-IO-24 N/A N/A
Class PT2-24B (3) $ 5,437,317.41 N/A N/A N/A
Class PT2-25A (2) $ 4,174,763.98 Class PT2-IO-25 N/A N/A
Class PT2-25B (3) $ 4,174,763.98 N/A N/A N/A
Class PT2-26A (2) $ 2,706,892.16 Class PT2-IO-26 N/A N/A
Class PT2-26B (3) $ 2,706,892.16 N/A N/A N/A
Class PT2-27A (2) $ 1,303,376.27 Class PT2-IO-27 N/A N/A
Class PT2-27B (3) $ 1,303,376.27 N/A N/A N/A
Class PT2-28A (2) $ 1,112,546.49 Class PT2-IO-28 N/A N/A
Class PT2-28B (3) $ 1,112,546.49 N/A N/A N/A
Class PT2-29A (2) $ 1,642,127.19 Class PT2-IO-29 N/A N/A
Class PT2-29B (3) $ 1,642,127.19 N/A N/A N/A
Class PT2-30A (2) $ 2,791,817.86 Class PT2-IO-30 N/A N/A
Class PT2-30B (3) $ 2,791,817.86 N/A N/A N/A
Class PT2-31A (2) $ 1,008,617.13 Class PT2-IO-31 N/A N/A
Class PT2-31B (3) $ 1,008,617.13 N/A N/A N/A
Class PT2-32A (2) $ 892,437.84 Class PT2-IO-32 N/A N/A
Class PT2-32B (3) $ 892,437.84 N/A N/A N/A
Class PT2-33A (2) $ 790,567.49 Class PT2-IO-33 N/A N/A
Class PT2-33B (3) $ 790,567.49 N/A N/A N/A
Class PT2-34A (2) $ 652,339.62 Class PT2-IO-34 N/A N/A
Class PT2-34B (3) $ 652,339.62 N/A N/A N/A
Class PT2-35A (2) $ 1,007,511.68 Class PT2-IO-35 N/A N/A
Class PT2-35B (3) $ 1,007,511.68 N/A N/A N/A
Class PT2-36A (2) $ 1,665,991.35 Class PT2-IO-36 N/A N/A
Class PT2-36B (3) $ 1,665,991.35 N/A N/A N/A
Class PT2-37A (2) $ 641,603.55 Class PT2-IO-37 N/A N/A
Class PT2-37B (3) $ 641,603.55 N/A N/A N/A
Class PT2-38A (2) $ 578,758.09 Class PT2-IO-38 N/A N/A
Class PT2-38B (3) $ 578,758.09 N/A N/A N/A
Class PT2-39A (2) $ 518,882.75 Class PT2-IO-39 N/A N/A
Class PT2-39B (3) $ 518,882.75 N/A N/A N/A
Class PT2-40A (2) $ 420,635.54 Class PT2-IO-40 N/A N/A
Class PT2-40B (3) $ 420,635.54 N/A N/A N/A
Class PT2-41A (2) $ 402,522.84 Class PT2-IO-41 N/A N/A
Class PT2-41B (3) $ 402,522.84 N/A N/A N/A
Class PT2-42A (2) $ 388,024.30 Class PT2-IO-42 N/A N/A
Class PT2-42B (3) $ 388,024.30 N/A N/A N/A
Class PT2-43A (2) $ 374,676.32 Class PT2-IO-43 N/A N/A
Class PT2-43B (3) $ 374,676.32 N/A N/A N/A
Class PT2-44A (2) $ 361,782.53 Class PT2-IO-44 N/A N/A
Class PT2-44B (3) $ 361,782.53 N/A N/A N/A
Class PT2-45A (2) $ 349,324.80 Class PT2-IO-45 N/A N/A
Class PT2-45B (3) $ 349,324.80 N/A N/A N/A
Class PT2-46A (2) $ 337,294.13 Class PT2-IO-46 N/A N/A
Class PT2-46B (3) $ 337,294.13 N/A N/A N/A
Class PT2-47A (2) $ 350,281.80 Class PT2-IO-47 N/A N/A
Class PT2-47B (3) $ 350,281.80 N/A N/A N/A
Class PT2-48A (2) $ 349,819.48 Class PT2-IO-48 N/A N/A
Class PT2-48B (3) $ 349,819.48 N/A N/A N/A
Class PT2-49A (2) $ 325,366.04 Class PT2-IO-49 N/A N/A
Class PT2-49B (3) $ 325,366.04 N/A N/A N/A
Class PT2-50A (2) $ 297,882.57 Class PT2-IO-50 N/A N/A
Class PT2-50B (3) $ 297,882.57 N/A N/A N/A
Class PT2-51A (2) $ 283,450.83 Class PT2-IO-51 N/A N/A
Class PT2-51B (3) $ 283,450.83 N/A N/A N/A
Class PT2-52A (2) $ 271,124.52 Class PT2-IO-52 N/A N/A
Class PT2-52B (3) $ 271,124.52 N/A N/A N/A
Class PT2-53A (2) $ 285,193.80 Class PT2-IO-53 N/A N/A
Class PT2-53B (3) $ 285,193.80 N/A N/A N/A
Class PT2-54A (2) $ 286,968.71 Class PT2-IO-54 N/A N/A
Class PT2-54B (3) $ 286,968.71 N/A N/A N/A
Class PT2-55A (2) $ 264,473.45 Class PT2-IO-55 N/A N/A
Class PT2-55B (3) $ 264,473.45 N/A N/A N/A
Class PT2-56A (2) $ 238,884.74 Class PT2-IO-56 N/A N/A
Class PT2-56B (3) $ 238,884.74 N/A N/A N/A
Class PT2-57A (2) $ 226,443.73 Class PT2-IO-57 N/A N/A
Class PT2-57B (3) $ 226,443.73 N/A N/A N/A
Class PT2-58A (2) $ 216,062.12 Class PT2-IO-58 N/A N/A
Class PT2-58B (3) $ 216,062.12 N/A N/A N/A
Class PT2-59A (2) $ 221,304.66 Class PT2-IO-59 N/A N/A
Class PT2-59B (3) $ 221,304.66 N/A N/A N/A
Class PT2-60A (2) $ 220,255.35 Class PT2-IO-60 N/A N/A
Class PT2-60B (3) $ 220,255.35 N/A N/A N/A
Class PT2-61A (2) $ 5,516,677.84 Class PT-IO-61 N/A N/A
Class PT2-61B (3) $ 5,516,677.84 N/A N/A N/A
Class PT2-IO-2 (4) (4) N/A Class PT1-2A May 2007
Class PT2-IO-3 (4) (4) N/A Class PT1-3A April 2008
Class PT2-IO-4 (4) (4) N/A Class PT1-4A May 2008
Class PT2-IO-5 (4) (4) N/A Class PT1-5A June 2008
Class PT2-IO-6 (4) (4) N/A Class PT1-6A July 2008
Class PT2-IO-7 (4) (4) N/A Class PT1-7A August 2008
Class PT2-IO-8 (4) (4) N/A Class PT1-8A September 2008
Class PT2-IO-9 (4) (4) N/A Class PT1-9A October 2008
Class PT2-IO-10 (4) (4) N/A Class PT1-10A November 2008
Class PT2-IO-11 (4) (4) N/A Class PT1-11A December 2008
Class PT2-IO-12 (4) (4) N/A Class PT1-12A January 2009
Class PT2-IO-13 (4) (4) N/A Class PT1-13A February 2009
Class PT2-IO-14 (4) (4) N/A Class PT1-14A March 2009
Class PT2-IO-15 (4) (4) N/A Class PT1-15A April 2009
Class PT2-IO-16 (4) (4) N/A Class PT1-16A May 2009
Class PT2-IO-17 (4) (4) N/A Class PT1-17A June 2009
Class PT2-IO-18 (4) (4) N/A Class PT1-18A July 2009
Class PT2-IO-19 (4) (4) N/A Class PT1-19A August 2009
Class PT2-IO-20 (4) (4) N/A Class PT1-20A September 2009
Class PT2-IO-21 (4) (4) N/A Class PT1-21A October 2009
Class PT2-IO-22 (4) (4) N/A Class PT1-22A November 2009
Class PT2-IO-23 (4) (4) N/A Class PT1-23A December 2009
Class PT2-IO-24 (4) (4) N/A Class PT1-24A January 2010
Class PT2-IO-25 (4) (4) N/A Class PT1-25A February 2010
Class PT2-IO-26 (4) (4) N/A Class PT1-26A March 2010
Class PT2-IO-27 (4) (4) N/A Class PT1-27A April 2010
Class PT2-IO-28 (4) (4) N/A Class PT1-28A May 2010
Class PT2-IO-29 (4) (4) N/A Class PT1-29A June 2010
Class PT2-IO-30 (4) (4) N/A Class PT1-30A July 2010
Class PT2-IO-31 (4) (4) N/A Class PT1-31A August 2010
Class PT2-IO-32 (4) (4) N/A Class PT1-32A September 2010
Class PT2-IO-33 (4) (4) N/A Class PT1-33A October 2010
Class PT2-IO-34 (4) (4) N/A Class PT1-34A November 2010
Class PT2-IO-35 (4) (4) N/A Class PT1-35A December 2010
Class PT2-IO-36 (4) (4) N/A Class PT1-36A January 2011
Class PT2-IO-37 (4) (4) N/A Class PT1-37A February 2011
Class PT2-IO-38 (4) (4) N/A Class PT1-38A March 2011
Class PT2-IO-39 (4) (4) N/A Class PT1-39A April 2011
Class PT2-IO-40 (4) (4) N/A Class PT1-40A May 2011
Class PT2-IO-41 (4) (4) N/A Class PT1-41A June 2011
Class PT2-IO-42 (4) (4) N/A Class PT1-42A July 2011
Class PT2-IO-43 (4) (4) N/A Class PT1-43A August 2011
Class PT2-IO-44 (4) (4) N/A Class PT1-44A September 2011
Class PT2-IO-45 (4) (4) N/A Class PT1-45A October 2011
Class PT2-IO-46 (4) (4) N/A Class PT1-46A November 2011
Class PT2-IO-47 (4) (4) N/A Class PT1-47A December 2011
Class PT2-IO-48 (4) (4) N/A Class PT1-48A January 2012
Class PT2-IO-49 (4) (4) N/A Class PT1-49A February 2012
Class PT2-IO-50 (4) (4) N/A Class PT1-50A March 2012
Class PT2-IO-51 (4) (4) N/A Class PT1-51A April 2012
Class PT2-IO-52 (4) (4) N/A Class PT1-52A May 2012
Class PT2-IO-53 (4) (4) N/A Class PT1-53A June 2012
Class PT2-IO-54 (4) (4) N/A Class PT1-54A July 2012
Class PT2-IO-55 (4) (4) N/A Class PT1-55A August 2012
Class PT2-IO-56 (4) (4) N/A Class PT1-56A September 2012
Class PT2-IO-57 (4) (4) N/A Class PT1-57A October 2012
Class PT2-IO-58 (4) (4) N/A Class PT1-58A November 2012
Class PT2-IO-59 (4) (4) N/A Class PT1-59A December 2012
Class PT2-IO-60 (4) (4) N/A Class PT1-60A January 2013
Class PT2-IO-61 (4) (4) N/A Class PT1-61A February 2013
Class PT2-1O-62 (4) (4) N/A Class PT1-62A March 2013
Class PT2-R (5) (5) N/A N/A N/A
------------
(1) For any Distribution Date (and the related Interest Accrual Period), this
Pooling-Tier REMIC-2 Regular Interest shall bear interest at a per-annum
rate (its "Pooling-Tier REMIC-2 Interest Rate") equal to the Pooling-Tier
REMIC-1 WAC Rate.
(2) For any Distribution Date (and the related Interest Accrual Period), this
Pooling-Tier REMIC-2 Regular Interest shall bear interest at a per-annum
rate (its "Pooling-Tier REMIC-2 Interest Rate") equal to the weighted
average of the Pooling-Tier REMIC-1 Interest Rates on the Pooling-Tier
REMIC-1 Regular Interests and having an "A" in their class designation,
provided that, on each Distribution Date on which interest is
distributable on the Corresponding Pooling-Tier REMIC-2 IO Interest
(which, for the avoidance of doubt shall not include any Distribution Date
prior to the Distribution Date in April 2008), this Pooling-Tier REMIC-2
Regular Interest shall bear interest at a per-annum rate equal to Swap
LIBOR subject to a maximum rate equal to the weighted average of the
Pooling-Tier REMIC-1 Interest Rates on the Pooling-Tier REMIC-1 Regular
Interests and having an "A" in their class designation.
(3) For any Distribution Date (and the related Interest Accrual Period), this
Pooling-Tier REMIC-2 Regular Interest shall bear interest at a per-annum
rate (its "Pooling-Tier REMIC-2 Interest Rate") equal to the weighted
average of the Pooling-Tier REMIC-1 Interest Rates on the Pooling-Tier
REMIC-1 Regular Interests and having a "B" in their class designation.
(4) Each Pooling-Tier REMIC-2 IO Interest is an interest only interest and
does not have a principal balance but has a notional balance
("Pooling-Tier REMIC-2 IO Notional Balance") equal to the Pooling-Tier
REMIC-2 Principal Amount of the Corresponding Pooling-Tier REMIC-1 Regular
Interest. From the Closing Date through and including the Distribution
Date in March 2008, this Pooling-Tier REMIC-2 IO Interest shall be
entitled to receive interest that accrues on the Corresponding
Pooling-Tier REMIC-1 Regular Interest at a rate equal to the excess, if
any, of (i) the Pooling-Tier REMIC-1 Interest Rate for the Corresponding
Pooling-Tier REMIC-1 Regular Interest over (ii) the Pooling-Tier REMIC-1
Interest Rate for the Corresponding Pooling-Tier REMIC-1 Regular Interest.
From and including the Distribution Date in April 2008, this Pooling-Tier
REMIC-2 IO Interest shall be entitled to receive interest that accrues on
the Corresponding Pooling-Tier REMIC-1 Regular Interest at a rate equal to
the excess, if any, of (i) the Pooling-Tier REMIC-1 Interest Rate for the
Corresponding Pooling-Tier REMIC-1 Regular Interest over (ii) Swap LIBOR.
After the Corresponding Scheduled Crossover Distribution Date, this
Pooling-Tier REMIC-2 IO Interest shall not accrue interest.
(5) The Class PT2-R Interest shall not have a principal balance and shall not
bear interest.
On each Distribution Date, the interest distributable in respect of
the Mortgage Loans for such Distribution Date shall be distributed to the
Pooling-Tier REMIC-2 Regular Interests at the Pooling-Tier REMIC-2 Interest
Rates shown above.
On each Distribution Date, Realized Losses, Subsequent Recoveries
and payments of principal in respect of the Mortgage Loans (including, for the
first three Distribution Dates only, amounts paid as principal from the
Pre-Funding Account) shall be allocated to the then outstanding Pooling-Tier
REMIC-2 Regular Interests (other than the Pooling-Tier REMIC-2 IO Interests)
with the lowest numerical denomination until the Pooling-Tier REMIC-2 Principal
Amount of such interest is reduced to zero, provided that, for Pooling-Tier
REMIC-2 Regular Interests Mortgage Loans with the same numerical denomination,
such Realized Losses, Subsequent Recoveries and payments of principal shall be
allocated pro rata between such Pooling-Tier REMIC-2 Regular Interests, until
the Pooling-Tier REMIC-2 Principal Amount of such interests is reduced to zero.
Lower-Tier REMIC
The Lower-Tier REMIC shall issue the following interests, and each
such interest, other than the Class LT-R Interest, is hereby designated as a
regular interest in the Lower-Tier REMIC. The Class LT-R Interest is hereby
designated as the sole class of residual interest in the Lower-Tier REMIC and
shall be represented by the Class R Certificates.
Corresponding
Upper-Tier
Lower-Tier Lower-Tier Initial Lower-Tier REMIC Regular
REMIC Interest Interest Rate Principal Amount Interest
-------------- ------------- ------------------------------------------- --------------
Class LT-A-1 (1) 1/2 initial Class Certificate Balance of A-1
Corresponding Upper-Tier Regular Interest
Class LT-A-2 (1) 1/2 initial Class Certificate Balance of A-2
Corresponding Upper-Tier Regular Interest
Class LT-A-3 (1) 1/2 initial Class Certificate Balance of A-3
Corresponding Upper-Tier Regular Interest
Class LT-A-4 (1) 1/2 initial Class Certificate Balance of A-4
Corresponding Upper-Tier Regular Interest
Class LT-M-1 (1) 1/2 initial Class Certificate Balance of M-1
Corresponding Upper-Tier Regular Interest
Class LT-M-2 (1) 1/2 initial Class Certificate Balance of M-2
Corresponding Upper-Tier Regular Interest
Class LT-M-3 (1) 1/2 initial Class Certificate Balance of M-3
Corresponding Upper-Tier Regular Interest
Class LT-M-4 (1) 1/2 initial Class Certificate Balance of M-4
Corresponding Upper-Tier Regular Interest
Class LT-M-5 (1) 1/2 initial Class Certificate Balance of M-5
Corresponding Upper-Tier Regular Interest
Class LT-M-6 (1) 1/2 initial Class Certificate Balance of M-6
Corresponding Upper-Tier Regular Interest
Class LT-B-1 (1) 1/2 initial Class Certificate Balance of B-1
Corresponding Upper-Tier Regular Interest
Class LT-B-2 (1) 1/2 initial Class Certificate Balance of B-2
Corresponding Upper-Tier Regular Interest
Class LT-B-3 (1) 1/2 initial Class Certificate Balance of B-3
Corresponding Upper-Tier Regular Interest
Class LT-B-4 (1) 1/2 initial Class Certificate Balance of B-4
Corresponding Upper-Tier Regular Interest
Class LT-Accrual (1) 1/2 Pool Stated Principal Balance plus 1/2 N/A
Subordinated Amount
Class LT-IO (2) (2) N/A
Class LT-PFIO (3) (3) N/A
Class LT-R (4) (4) N/A
------------
(1) The interest rate with respect to any Distribution Date for these
interests is a per-annum variable rate equal to the weighted average of
the Pooling-Tier REMIC-2 Interest Rates of the Pooling-Tier REMIC-2
Regular Interests (other than the Pooling-Tier REMIC-2 IO Interests and
the Class PT2-PFIO Interest).
(2) This Lower-Tier Regular Interest is an interest only interest and does not
have a Lower-Tier Principal Amount. On each Distribution Date, this
Lower-Tier Regular Interest shall be entitled to receive all interest
distributable on the Pooling-Tier REMIC-2 IO Interests.
(3) This Lower-Tier Regular Interest is an interest only interest and does not
have a Lower-Tier Principal Amount. On each Distribution Date, this
Lower-Tier Regular Interest shall be entitled to receive all interest
distributable on the Class PT2-PFIO Interest.
(4) The Class LT-R Interest is the sole class of residual interest in the
Lower-Tier REMIC and it does not have a principal amount or an interest
rate.
Each Lower-Tier Regular Interest is hereby designated as a regular
interest in the Lower-Tier REMIC. The Class LT-A-1, Class LT-A-2, Class LT-A-3,
Class LT-A-4, Class LT-M-1, Class LT-M-2, Class LT-M-3, Class LT-M-4, Class
LT-M-5, Class LT-M-6, Class LT-B-1, Class LT-B-2, Class LT-B-3 and Class LT-B-4
Interests are hereby designated the LT Accretion Directed Classes (the "LT
Accretion Directed Classes").
On each Distribution Date, 50% of the increase in the Subordinated
Amount shall be payable as a reduction of the Lower-Tier Principal Amount of the
LT Accretion Directed Classes (each such Class will be reduced by an amount
equal to 50% of any increase in the Subordinated Amount that is attributable to
a reduction in the Class Certificate Balance of its Corresponding Class) and
shall be accrued and added to the Lower-Tier Principal Amount of the Class
LT-Accrual Interest. On each Distribution Date, the increase in the Lower-Tier
Principal Amount of the Class LT-Accrual Interest shall not exceed interest
accruals for such Distribution Date for the Class LT-Accrual Interest. In the
event that: (i) 50% of the increase in the Subordinated Amount exceeds (ii)
interest accruals on the Class LT-Accrual Interest for such Distribution Date,
the excess for such Distribution Date (accumulated with all such excesses for
all prior Distribution Dates) will be added to any increase in the Subordinated
Amount for purposes of determining the amount of interest accrual on the Class
LT-Accrual Interest payable as principal on the LT Accretion Directed Classes on
the next Distribution Date pursuant to the first sentence of this paragraph. All
payments of scheduled principal and prepayments of principal generated by the
Mortgage Loans (including, for the first three Distribution Dates, amounts paid
as principal from the Pre-Funding Account) and all Subsequent Recoveries
allocable to principal shall be allocated (i) 50% to the Class LT-Accrual
Interest and (ii) 50% to the LT Accretion Directed Classes (such principal
payments and Subsequent Recoveries shall be allocated among such LT Accretion
Directed Classes in an amount equal to 50% of the principal amounts and
Subsequent Recoveries allocated to their respective Corresponding Classes),
until paid in full. Notwithstanding the above, principal payments allocated to
the Class UT-X Interest that result in the reduction in the Subordinated Amount
shall be allocated to the Class LT-Accrual Interest (until paid in full).
Realized Losses shall be applied so that after all distributions have been made
on each Distribution Date (i) the Lower-Tier Principal Amount of each LT
Accretion Directed Class is equal to 50% of the Class Certificate Balance of its
Corresponding Class, and (ii) the Class LT-Accrual Interest is equal to 50% of
the aggregate Stated Principal Balance of the Mortgage Loans plus 50% of the
Subordinated Amount. Any increase in the Class Certificate Balance of a Class of
LIBOR Certificates as a result of a Subsequent Recovery shall increase the
Lower-Tier Principal Amount of the Corresponding Lower-Tier Regular Interest by
50% of such increase, and the remaining 50% of such increase shall increase the
Lower-Tier Principal Amount of the Class LT-Accrual Interest.
Upper-Tier REMIC
The Upper-Tier REMIC shall issue the following interests, and each
such interest, other than the Class UT-R Interest, is hereby designated as a
regular interest in the Upper-Tier REMIC. The Class UT-R Interest is hereby
designated as the sole class of residual interests in the Upper-Tier REMIC and
shall be represented by the Class R Certificates.
Upper-Tier Upper-Tier Initial Principal Corresponding
REMIC Interest Interest Rate Upper-Tier Amount Class of Certificates
-------------- ------------- ----------------- ---------------------
Class A-1 (1) $363,740,000 Class A-1
Class A-2 (1) $111,250,000 Class A-2
Class A-3 (1) $147,145,000 Class A-3
Class A-4 (1) $ 90,645,000 Class A-4
Class M-1 (1) $ 32,940,000 Class M-1
Class M-2 (1) $ 30,653,000 Class M-2
Class M-3 (1) $ 18,300,000 Class M-3
Class M-4 (1) $ 16,013,000 Class M-4
Class M-5 (1) $ 15,555,000 Class M-5
Class M-6 (1) $ 14,640,000 Class M-6
Class B-1 (1) $ 13,725,000 Class B-1
Class B-2 (1) $ 11,895,000 Class B-2
Class B-3 (1) $ 10,980,000 Class B-3
Class B-4 (1) $ 9,150,000 Class B-4
Class UT-IO (2) (2) N/A
Class UT-PFIO (3) (3) N/A
Class UT-X (4) (4) Class X
Class UT-R (5) (5) Class R
------------
(1) For any Distribution Date (and the related Interest Accrual Period) this
interest shall bear interest at the lesser of (i) the Pass-Through Rate
(determined without regard to the WAC Cap) for the Corresponding Class of
Certificates and (ii) the Upper-Tier REMIC WAC Rate.
(2) This interest is an interest only interest and does not have a principal
balance. On each Distribution Date, the Class UT-IO Interest shall be
entitled to receive all interest distributable on the Class LT-IO
Interest. This interest shall be beneficially owned by the holders of the
Class X Certificates and shall be held as an asset of the Swap Account.
(3) This Upper-Tier Regular Interest is an interest-only interest and does not
have an Upper-Tier Principal Amount. On each Distribution Date, this
Upper-Tier Regular Interest shall be entitled to receive all interest
distributable on the Class LT-PFIO Interest. This interest shall be
beneficially owned by the holders of the Class X Certificates and shall be
held as an asset of the Swap Account.
(4) The Class UT-X Interest has an initial principal balance of
$28,369,000.01, but will not accrue interest on such balance but will
accrue interest on a notional principal balance. As of any Distribution
Date, the Class UT-X Interest shall have a notional principal balance
equal to the aggregate of the Lower-Tier Principal Amounts of the
Lower-Tier Regular Interests (other than the Class LT-IO and Class LT-PFIO
Interests) as of the first day of the related Interest Accrual Period.
With respect to any Interest Accrual Period, the Class UT-X Interest shall
bear interest at a rate equal to the excess, if any, of the Upper-Tier
REMIC WAC Rate over the product of (i) 2 and (ii) the weighted average of
the Lower-Tier Interest Rates of the Lower-Tier REMIC Interests (other
than the Class LT-IO and Class LT-PFIO Interests), where the Lower-Tier
Interest Rate on the Class LT-Accrual Interest is subject to a cap equal
to zero and each LT Accretion Directed Class is subject to a cap equal to
the Upper-Tier Interest Rate on its Corresponding Class of Upper-Tier
Regular Interest. With respect to any Distribution Date, interest that so
accrues on the notional principal balance of the Class UT-X Interest shall
be deferred in an amount equal to any increase in the Subordinated Amount
on such Distribution Date. Such deferred interest shall not itself bear
interest.
(5) The Class UT-R Interest does not have an interest rate or a principal
balance.
On each Distribution Date, interest distributable in respect of the
Lower-Tier Interests for such Distribution Date shall be deemed to be
distributed on the interests in the Upper-Tier REMIC at the rates shown above,
provided that the Class UT-IO Interest shall be entitled to receive interest
before any other interest in the Upper-Tier REMIC.
On each Distribution Date, all Realized Losses, Subsequent
Recoveries and all payments of principal shall be allocated to the Upper-Tier
REMIC Interests until the outstanding principal balance of each such interest
equals the outstanding Class Certificate Balance of the Corresponding Class of
Certificates as of such Distribution Date.
Class X REMIC
The Class X REMIC shall issue the following classes of interests.
The Class X Interest, the Class PF-IO Interest and the Class IO Interest shall
each represent a regular interest in the Class X REMIC and the Class RX
Certificates shall represent the sole class of residual interest in the Class X
REMIC.
Class X REMIC
Class X REMIC Designation Interest Rate Principal Amount
------------------------- ------------- ----------------
Class X Interest (1) (1)
Class IO Interest (2) (2)
Class PF-IO Interest (3) (3)
Class RX Certificates (4) (4)
------------
(1) The Class X Interest has an initial principal balance equal to the initial
principal balance of the Class UT-X Interest and is entitled to 100% of
the interest and principal distributable on the Class UT-X Interest on
each Distribution Date.
(2) This interest is an interest-only interest and does not have a principal
balance. On each Distribution Date the Class IO Interest shall be entitled
to receive 100% of the interest distributable on the Class UT-IO Interest.
(3) This interest is an interest-only interest and does not have a principal
balance. On each Distribution Date the Class PF-IO Interest shall be
entitled to receive 100% of the interest distributable on the Class
UT-PFIO Interest.
(4) The Class RX Certificates do not have a principal balance or an interest
rate.
The Certificates
Class Pass-Through Class
Class Designation Rate Certificate Balance
----------------- ------------------- -------------------
Class A-1(1) (1) $ 363,740,000
Class A-2(5) (1) $ 111,250,000
Class A-3(5) (1) $ 147,145,000
Class A-4(5) (1) $ 90,645,000
Class M-1(5) (1) $ 32,940,000
Class M-2(5) (1) $ 30,653,000
Class M-3(5) (1) $ 18,300,000
Class M-4(5) (1) $ 16,013,000
Class M-5(5) (1) $ 15,555,000
Class M-6(5) (1) $ 14,640,000
Class B-1(5) (1) $ 13,725,000
Class B-2(5) (1) $ 11,895,000
Class B-3(5) (1) $ 10,980,000
Class B-4(5) (1) $ 9,150,000
Class X (2) (2)
Class R (3) (3)
Class RX (4) (4)
------------
(1) The Class A-1, Class A-2, Class A-3, Class A-4 Interest and the 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 will bear interest during each
Interest Accrual Period at a per-annum rate equal to the lesser of (i)
LIBOR plus the applicable Pass-Through Margin and (ii) the WAC Cap.
(2) The Class X Certificates will represent beneficial ownership of the Class
X Interest, the Class IO Interest, the Class PF-IO Interest, the Interest
Rate Swap Agreement, the Interest Rate Cap Agreement, the right to receive
Class IO Shortfalls and amounts in the Excess Reserve Fund Account and the
Swap Account, subject to the obligation to make payments from the Excess
Reserve Fund Account in respect of Basis Risk CarryForward Amounts and
amounts in the Swap Account subject to the obligation to make Net Swap
Payments, Swap Termination Payments, Basis Risk CarryForward Amounts and,
without duplication, Upper-Tier CarryForward Amounts. For federal income
tax purposes, the Securities Administrator will treat a Class X
Certificateholder's obligation to make payments from the Excess Reserve
Fund Account or the Swap Account as payments made under a notional
principal contract between the Class X Certificateholders in favor of each
Class of LIBOR Certificates. Such rights of the Class X Certificateholders
and LIBOR Certificateholders shall be treated as held in the Grantor
Trust.
(3) The Class R Certificates do not have an interest rate or a principal
balance.
(4) The Class RX Certificates do not have an interest rate or a principal
balance.
(5) Each of these Certificates will represent not only the ownership of the
Corresponding Class of Upper-Tier Regular Interest but also the right to
receive payments from the Excess Reserve Fund Account and the Swap Account
in respect of any Basis Risk CarryForward Amounts and, without
duplication, Upper-Tier CarryForward Amounts. Each of these Certificates
will also be subject to the obligation to pay Class IO Shortfalls as
described in Section 8.13. For federal income tax purposes, any amount
distributed on the LIBOR Certificates on any such Distribution Date in
excess of the amount distributable on their Corresponding Class of
Upper-Tier Regular Interest on such Distribution Date shall be treated as
having been paid from the Excess Reserve Fund Account or the Swap Account,
as applicable, and any amount distributable on such Corresponding Class of
Upper-Tier Regular Interest on such Distribution Date in excess of the
amount distributable on the LIBOR Certificates on such Distribution Date
shall be treated as having been paid to the Swap Account, all pursuant to,
and as further provided in, Section 8.13. For federal income tax purposes,
the Securities Administrator will treat a LIBOR Certificateholder's right
to receive payments from the Excess Reserve Fund Account or the Swap
Account, subject to the obligation to pay Class IO Shortfalls, as rights
and obligations under a notional principal contract between the Class X
Certificateholders and the LIBOR Certificateholders.
The minimum denomination for each Class of Certificates, other than
the Class P, Class R, Class RX and the Class X Certificates, will be $25,000
with integral multiples of $1 in excess thereof. The minimum denomination for
the Class P and the Class X Certificates will each be a 1% Percentage Interest
in such Class. The Class R Certificate and the Class RX Certificate will each
represent a 100% Percentage Interest in the related Class.
It is expected that each Class of Certificates will receive its
final distribution of principal and interest on or prior to the Final Scheduled
Distribution Date.
Set forth below are designations of Classes of Certificates to the
categories used herein:
Book-Entry Certificates...... All Classes of Certificates other than the
Physical Certificates.
Delay Certificates........... None.
ERISA-Restricted
Certificates ............... Class B-4, Class R, Class RX, Class P and Class X
Certificates; any certificate with a rating below
the lowest applicable permitted rating under the
Underwriters' Exemption.
LIBOR Certificates........... Class A-1, Class A-2, Class A-3, Class A-4 and
Subordinated Certificates.
Non-Delay Certificates....... Class A-1, Class A-2, Class A-3, Class A-4, Class
X and Subordinated Certificates.
Offered Certificates......... All Classes of Certificates other than the Private
Certificates.
Physical Certificates........ Class P, Class X, Class R and Class RX
Certificates.
Private Certificates......... Class B-4, Class P, Class X, Class R and Class RX
Certificates.
Rating Agencies.............. Xxxxx'x, Fitch and Standard & Poor's.
Regular Certificates......... All Classes of Certificates other than the Class
P, Class R and Class RX Certificates.
Residual Certificates........ Class R and Class RX Certificates.
Subordinated Certificates.... 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.
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
Accepted Servicing Practices: With respect to any Mortgage Loan,
those mortgage servicing practices set forth in Section 3.01(a) of this
Agreement.
Account: Any of the Capitalized Interest Account, the Collection
Account, the Distribution Account, any Escrow Account, the Excess Reserve Fund
Account, the Swap Account, the Pre-Funding Account or the Pre-Funding Reserve
Account. Each Account shall be an Eligible Account.
Accredited: Accredited Home Lenders, Inc., a California corporation,
and its successors in interest.
Accredited Agreements: The Accredited Purchase Agreement and the
Accredited Assignment Agreement, copies of which are attached hereto as Exhibit
BB.
Accredited Assignment Agreement: The Assignment and Recognition
Agreement, dated as of April 30, 2007, by and among the Unaffiliated Seller, the
Depositor and Accredited, and each other Assignment and Recognition Agreement,
by and among the Unaffiliated Seller, the Depositor and Accredited in connection
with any Subsequent Transfer of Accredited Mortgage Loans.
Accredited Mortgage Loan: A Mortgage Loan which was acquired from
Accredited by the Unaffiliated Seller pursuant to the Accredited Purchase
Agreement, and which has been acquired by the Trust Fund.
Accredited Purchase Agreement: The Third Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of August 1, 2006, as
amended to date, by and between the Unaffiliated Seller and Accredited.
Accrued Certificate Interest: With respect to any Distribution Date
for each Class of LIBOR Certificates, the amount of interest accrued during the
related Interest Accrual Period at the applicable Pass-Through Rate on the
related Class Certificate Balance immediately prior to such Distribution Date,
as reduced by such Class's share of Net Prepayment Interest Shortfalls and
Relief Act Interest Shortfalls for such Distribution Date allocated to such
Class pursuant to Section 4.02.
Additional Disclosure Notification: A notification in the form of
Exhibit U.
Addition Notice: A written notice from the Unaffiliated Seller to
the Trustee, the Rating Agencies and the Securities Administrator that the
Unaffiliated Seller desires to make a Subsequent Transfer.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan.
Adjusted Net Mortgage Rate: As to each Mortgage Loan and at any
time, the per annum rate equal to the Mortgage Rate less the Expense Fee Rate.
Adjustment Date: As to any Adjustable Rate Mortgage Loan, the first
Due Date on which the related Mortgage Rate adjusts as set forth in the related
Mortgage Note and each Due Date thereafter on which the Mortgage Rate adjusts as
set forth in the related Mortgage Note.
Advances: Any P&I Advance or Servicing Advance.
Advance Facility: A financing or other facility as described in
Section 12.07.
Advancing Person: The Person to whom the Servicer's rights under
this Agreement to be reimbursed for any P&I Advances or Servicing Advances have
been assigned pursuant to Section 12.07.
Affiliate: With respect to any Person, any other Person controlling,
controlled by or under common control with such first Person. For the purposes
of this definition, "control" means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agent: With respect to the Unaffiliated Seller, the Depositor or any
Affiliate of either of them, a Person that acts for and on behalf of such
Person.
Agreement: This Pooling and Servicing Agreement and all amendments
or supplements hereto.
Amount Held for Future Distribution: As to the Certificates on any
Distribution Date, the aggregate amount held in each Collection Account at the
close of business on the related Determination Date on account of (i) Principal
Prepayments, Insurance Proceeds, Condemnation Proceeds and Liquidation Proceeds
on the Mortgage Loans received after the end of the related Prepayment Period
and (ii) all Scheduled Payments on the Mortgage Loans due after the end of the
related Due Period.
Analytics Company: Intex Solutions, Inc., or any other bond
analytics service provider identified to the Securities Administrator by the
Depositor.
Applied Realized Loss Amount: With respect to any Distribution Date,
the amount, if any, by which the aggregate Class Certificate Balance of the
LIBOR Certificates after distributions of principal on such Distribution Date
exceeds the aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution Date.
Appraised Value: The value set forth in an appraisal made in
connection with the origination of the related Mortgage Loan as the value of the
Mortgaged Property.
Assignment and Recognition Agreement: The Accredited Assignment
Agreement, the CIT Assignment Agreement, the First Horizon Assignment Agreement,
the First NLC Assignment Agreement, the FlexPoint Assignment Agreement, the
Funding America Assignment Agreement, the Lime Financial Assignment Agreement,
the Master Financial Assignment Agreement, the Maxim Assignment Agreement, or
the Platinum Assignment Agreement or the Rose Assignment Agreement, as
applicable.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form (other than the assignee's
name and recording information not yet returned from the recording office),
reflecting the sale of the Mortgage to the Trustee.
Available Funds: With respect to any Distribution Date and the
Mortgage Loans, to the extent received by the Securities Administrator (x) the
sum of (i) the aggregate amount of Scheduled Payments on the Mortgage Loans due
on the related Due Date (net of the related Expense Fees) and received by the
Servicer on or prior to the related Determination Date, together with any P&I
Advance in respect thereof, (ii) unscheduled payments in respect of the Mortgage
Loans that constitute Principal Prepayments, Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds (excluding Prepayment Charges) received by the
Servicer during the related Prepayment Period (in each case, net of remaining
(i.e., not deducted from the Interest Remittance Amount) unreimbursed expenses
incurred in connection with a liquidation or foreclosure and unreimbursed
Advances, if any), (iii) Compensating Interest payments from the Servicer to the
Securities Administrator in respect of Prepayment Interest Shortfalls for that
Distribution Date, (iv) for any Distribution Date on or prior to July 25, 2007,
any funds required to be paid from the Capitalized Interest Account to make up
for any interest shortfalls on the Initial Mortgage Loans, (v) immediately
following the end of the Pre-Funding Period, all amounts, if any, on deposit in
the Pre-Funding Account, (vi) the proceeds from repurchases of Mortgage Loans,
and any Substitution Adjustment Amounts received in connection with respect to
the substitutions of Mortgage Loans, that occur during the month in which such
Distribution Date occurs at the Repurchase Price and (vii) all proceeds received
with respect to the termination of the Trust Fund pursuant to Section 11.01
hereof, reduced by (y) amounts in reimbursement for Advances previously made
with respect to the Mortgage Loans and other amounts, in each case, as to which
the Master Servicer, the Securities Administrator, the Servicer, the Depositor,
the Custodian or the Trustee are entitled to be paid or reimbursed pursuant to
this Agreement and any costs associated with a transfer of servicing to the
extent not paid by the predecessor servicer.
Balloon Loan: Any Mortgage Loan that requires only payments of
interest until the stated maturity date of the Mortgage Loan or Scheduled
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by the stated maturity date of the
Mortgage Loan.
Basic Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the Principal Remittance Amount for such
Distribution Date over (ii) the sum of the Excess Subordinated Amount, if any,
for such Distribution Date and any Net Swap Payment to the extent not covered by
the Interest Remittance Amount.
Basis Risk Carry Forward Amount: With respect to each Class of LIBOR
Certificates, as of any Distribution Date, the sum of (A) if on such
Distribution Date the Pass-Through Rate for any Class of LIBOR Certificates is
based upon the WAC Cap, the excess of (i) the Accrued Certificate Interest such
Class of Certificates would otherwise be entitled to receive on such
Distribution Date had such rate been calculated as the sum of LIBOR and the
applicable Pass-Through Margin on such Class of Certificates for such
Distribution Date, over (ii) the Accrued Certificate Interest payable on such
Class of Certificates calculated at the WAC Cap for such Distribution Date and
(B) the Basis Risk Carry Forward Amount for such Class of Certificates for all
previous Distribution Dates not previously paid, together with interest thereon
at a rate equal to the sum of LIBOR and the applicable Pass-Through Margin for
such Class of Certificates for such Distribution Date.
Basis Risk Payment: For any Distribution Date, an amount equal to
any Basis Risk Carry Forward Amount for such Distribution Date; provided,
however, that the payment cannot exceed the sum of Interest Rate Cap Payments,
the amounts payable from the Swap Account and amounts otherwise available for
distribution on the Class X Certificates (prior to any reduction for (x) amounts
paid from the Excess Reserve Fund Account to pay any Basis Risk Carry Forward
Amount or (y) any Defaulted Swap Termination Payment).
Best's: Best's Key Rating Guide, as the same shall be amended from
time to time.
Book-Entry Certificates: As specified in the Preliminary Statement.
Business Day: Any day other than (i) Saturday or Sunday, or (ii) a
day on which banking and savings and loan institutions, in (a) the States of
California, Minnesota, New York, Utah, New Jersey and Florida, (b) the
applicable states in which the Servicer's servicing operations are located, (c)
the State in which the Securities Administrator's or Master Servicer's
operations are located or (d) the State in which the Custodian's operations are
located, are authorized or obligated by law or executive order to be closed.
Cap Provider: Natixis Financial Products Inc., a Delaware
corporation, and any successor thereto.
Capitalized Interest Account: The separate Eligible Account created
and maintained by the Securities Administrator pursuant to Section 3.07(e) in
the name of the Securities Administrator for the benefit of the LIBOR
Certificateholders and designated "Xxxxx Fargo Bank, National Association, in
trust for registered holders of Natixis Real Estate Capital Trust 2007-HE2,
Mortgage Pass-Through Certificates, Series 2007-HE2".
Capitalized Interest Requirement: With respect to the Distribution
Dates occurring in May 2007, June 2007 or July 2007, the excess, if any, of (x)
the Accrued Certificate Interest for all classes of the LIBOR Certificates for
such Distribution Date (excluding any Basis Risk Carry Forward Amount) over (y)
all scheduled installments of interest (net of the related Expense Fees) due on
the Mortgage Loans in the related Due Period. In no event shall the Capitalized
Interest Requirement be less than zero. Notwithstanding the preceding sentence,
for the avoidance of doubt, the Capitalized Interest Requirement shall equal
zero.
Certificate: Any one of the Certificates executed by the Securities
Administrator in substantially the forms attached hereto as exhibits.
Certificate Balance: With respect to any Class of Certificates,
other than the Class X, Class P, Class R or Class RX Certificates, at any date,
the maximum dollar amount of principal to which the Holder thereof is then
entitled hereunder, such amount being equal to the Denomination thereof minus
all distributions of principal previously made with respect thereto and in the
case of any Certificates, reduced by any Applied Realized Loss Amounts allocated
to such Class of Certificates pursuant to Section 4.07; provided, however, that
immediately following the Distribution Date on which a Subsequent Recovery is
distributed, the Class Certificate Balances of any Class or Classes of
Certificates that have been previously reduced by Applied Realized Loss Amounts
will be increased, in order of seniority, by the amount of the Subsequent
Recovery distributed on such Distribution Date (up to the amount of the Unpaid
Realized Loss Amount for such Class or Classes for such Distribution Date). The
Class X, Class P, Class R and Class RX Certificates have no Certificate Balance.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate.
Certificate Register: The register maintained pursuant to Section
5.02.
Certificateholder or Holder: The Person in whose name a Certificate
is registered in the Certificate Register, except that, solely for the purpose
of giving any consent pursuant to this Agreement, any Certificate registered in
the name of the Unaffiliated Seller, Depositor or any Affiliate or Agent of any
of them shall be deemed not to be Outstanding and the Percentage Interest
evidenced thereby shall not be taken into account in determining whether the
requisite amount of Percentage Interests necessary to effect such consent has
been obtained; provided, however, that if the Unaffiliated Seller (together with
its Affiliates and Agents) or the Depositor (together with its Affiliates and
Agents) owns 100% of the Percentage Interests evidenced by a Class of
Certificates, such Certificates shall be deemed to be Outstanding for the
purposes of any provision hereof that requires the consent of the Holders of
Certificates of a particular Class as a condition to the taking of any action
hereunder. The Securities Administrator is entitled to rely conclusively on a
certification of the Unaffiliated Seller, the Depositor or any such Agent or
Affiliate in determining which Certificates are registered in the name of an
Agent or Affiliate of Unaffiliated Seller or the Depositor.
Charge-off Date: As defined in Section 3.07(o).
CIT: The CIT Group/Consumer Finance Inc., a Delaware Corporation,
The CIT Group/Consumer Finance, Inc. (NY), a New York Corporation and The CIT
Group/Consumer Finance, Inc. (TN), a Tennessee Corporation.
CIT Agreements: The CIT Purchase Agreement and the CIT Assignment
Agreement, copies of which are attached hereto as Exhibit CC.
CIT Assignment Agreement: The Assignment and Recognition Agreement,
dated as of April 30, 2007, by and among the Unaffiliated Seller, the Depositor
and CIT, and each other Assignment and Recognition Agreement by and among the
Unaffiliated Seller, the Depositor and CIT in connection with any Subsequent
Transfer of CIT Mortgage Loans.
CIT Mortgage Loan: A Mortgage Loan which was acquired from CIT by
the Unaffiliated Seller pursuant to the CIT Purchase Agreement, and which has
been acquired by the Trust Fund.
CIT Purchase Agreement: The Mortgage Loan Purchase and Interim
Servicing Agreement, dated as of January 1, 2007 as amended to date, by and
between the Unaffiliated Seller and CIT.
Class: All Certificates bearing the same class designation as set
forth in the Preliminary Statement.
Class A Certificates: The Class A-1, Class A-2, Class A-3 and
Class A-4 Certificates, collectively.
Class A Principal Distribution Amount: With respect to any
Distribution Date, the excess of (x) the aggregate Class Certificate Balances of
the Class A Certificates immediately prior to such Distribution Date over
(y) the lesser of (A) 55.80% of the Current Maximum Amount for such
Distribution Date and (B) the excess, if any, of the Current Maximum Amount for
such Distribution Date over $4,575,000.
Class A-1 Certificates: All Certificates bearing the class
designation of "Class A-1."
Class A-2 Certificates: All Certificates bearing the class
designation of "Class A-2."
Class A-3 Certificates: All Certificates bearing the class
designation of "Class A-3."
Class A-4 Certificates: All Certificates bearing the class
designation of "Class A-4."
Class B Certificates: The Class B-1, Class B-2, Class B-3 and
Class B-4 Certificates, collectively.
Class B-1 Certificates: All Certificates bearing the class
designation of "Class B-1."
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount for such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal Distribution
Amount for such Distribution Date), (C) the Class Certificate Balance of the
Class M-2 Certificates (after taking into account the distribution of the
Class M-2 Principal Distribution Amount for such Distribution Date), (D) the
Class Certificate Balance of the Class M-3 Certificates (after taking into
account the distribution of the Class M-3 Principal Distribution Amount for such
Distribution Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after taking into account the distribution of the Class M-4
Principal Distribution Amount for such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount for such
Distribution Date), (G) the Class Certificate Balance of the Class M-6
Certificates (after taking into account the distribution of the Class M-6
Principal Distribution Amount for such Distribution Date) and (H) the Class
Certificate Balance of the Class B-1 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) 86.80% of the Current Maximum
Amount for such Distribution Date and (B) the excess, if any, of the Current
Maximum Amount for such Distribution Date over $4,575,000.
Class B-2 Certificates: All Certificates bearing the class
designation of "Class B-2".
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount for such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal Distribution
Amount for such Distribution Date), (C) the Class Certificate Balance of the
Class M-2 Certificates (after taking into account the distribution of the
Class M-2 Principal Distribution Amount for such Distribution Date), (D) the
Class Certificate Balance of the Class M-3 Certificates (after taking into
account the distribution of the Class M-3 Principal Distribution Amount for such
Distribution Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after taking into account the distribution of the Class M-4
Principal Distribution Amount for such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount for such
Distribution Date), (G) the Class Certificate Balance of the Class M-6
Certificates (after taking into account the distribution of the Class M-6
Principal Distribution Amount for such Distribution Date), (H) the Class
Certificate Balance of the Class B-1 Certificates (after taking into account the
distribution of the Class B-1 Principal Distribution Amount for such
Distribution Date) and (I) the Class Certificate Balance of the Class B-2
Certificates immediately prior to such Distribution Date over (ii) the lesser of
(A) 89.40% of the Current Maximum Amount for such Distribution Date and (B) the
excess, if any, of the Current Maximum Amount for such Distribution Date over
$4,575,000.
Class B-3 Certificates: All Certificates bearing the class
designation of "Class B-3".
Class B-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount for such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal Distribution
Amount for such Distribution Date), (C) the Class Certificate Balance of the
Class M-2 Certificates (after taking into account the distribution of the
Class M-2 Principal Distribution Amount for such Distribution Date), (D) the
Class Certificate Balance of the Class M-3 Certificates (after taking into
account the distribution of the Class M-3 Principal Distribution Amount for such
Distribution Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after taking into account the distribution of the Class M-4
Principal Distribution Amount for such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount for such
Distribution Date), (G) the Class Certificate Balance of the Class M-6
Certificates (after taking into account the distribution of the Class M-6
Principal Distribution Amount for such Distribution Date), (H) the Class
Certificate Balance of the Class B-1 Certificates (after taking into account the
distribution of the Class B-1 Principal Distribution Amount for such
Distribution Date), (I) the Class Certificate Balance of the Class B-2
Certificates (after taking into account the distribution of the Class B-2
Principal Distribution Amount for such Distribution Date) and (J) the Class
Certificate Balance of the Class B-3 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) 91.80% of the Current Maximum
Amount for such Distribution Date and (B) the excess, if any, of the Current
Maximum Amount for such Distribution Date over $4,575,000.
Class B-4 Certificates: All Certificates bearing the class
designation of "Class B-4".
Class B-4 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount for such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal Distribution
Amount for such Distribution Date), (C) the Class Certificate Balance of the
Class M-2 Certificates (after taking into account the distribution of the
Class M-2 Principal Distribution Amount for such Distribution Date), (D) the
Class Certificate Balance of the Class M-3 Certificates (after taking into
account the distribution of the Class M-3 Principal Distribution Amount for such
Distribution Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after taking into account the distribution of the Class M-4
Principal Distribution Amount for such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount for such
Distribution Date), (G) the Class Certificate Balance of the Class M-6
Certificates (after taking into account the distribution of the Class M-6
Principal Distribution Amount for such Distribution Date), (H) the Class
Certificate Balance of the Class B-1 Certificates (after taking into account the
distribution of the Class B-1 Principal Distribution Amount for such
Distribution Date), (I) the Class Certificate Balance of the Class B-2
Certificates (after taking into account the distribution of the Class B-2
Principal Distribution Amount for such Distribution Date), (J) the Class
Certificate Balance of the Class B-3 Certificates (after taking into account the
distribution of the Class B-3 Principal Distribution Amount for such
Distribution Date) and (K) the Class Certificate Balance of the Class B-4
Certificates immediately prior to such Distribution Date over (ii) the lesser of
(A) approximately 93.80% of the Current Maximum Amount for such Distribution
Date and (B) the excess, if any, of the Current Maximum Amount for such
Distribution Date over approximately $4,575,000.
Class Certificate Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Balances of all
Certificates of such Class as of such date.
Class IO Interest: The regular interest in the Class X REMIC
represented by the Class X Certificates as specified and described in the
Preliminary Statement and the related footnote thereto.
Class IO Shortfalls: As defined in Section 8.13. For the avoidance
of doubt, the Class IO Shortfall for any Distribution Date shall equal the
amount payable to the Class X Certificates in respect of amounts due to the Swap
Provider on such Distribution Date (other than Defaulted Swap Termination
Payments) in excess of the amount payable on the Class X Interest (prior to any
reduction for Basis Risk Payments or Defaulted Swap Termination Payments) from
Available Funds on such Distribution Date, all as further provided in
Section 8.13.
Class LT-R Interest: The residual interest in the Lower-Tier REMIC
as described in the Preliminary Statement and the related footnote thereto.
Class M Certificates: The Class M-1, Class M-2, Class M-3,
Class M-4, Class M-5 and Class M-6 Certificates, collectively.
Class M-1 Certificates: All Certificates bearing the class
designation of "Class M-1".
Class M-1 Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balance of the Class M-2, Class M-3, Class M-4, Class M-5 and
Class M-6 Certificates and the Class B Certificates and (ii) the Subordinated
Amount (in each case after taking into account the allocation of the Principal
Distribution Amount and any principal payments on those classes of certificates
from the Swap Account for such Distribution Date) by (y) the Current Maximum
Amount for that Distribution Date.
Class M-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount for such Distribution
Date) and (B) the Class Certificate Balance of the Class M-1 Certificates
immediately prior to such Distribution Date over (ii) the lesser of (A) 63.00%
of the Current Maximum Amount for such Distribution Date and (B) the excess, if
any, of the Current Maximum Amount for such Distribution Date over $4,575,000.
Class M-2 Certificates: All Certificates bearing the class
designation of "Class M-2."
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount for such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal Distribution
Amount for such Distribution Date) and (C) the Class Certificate Balance of the
Class M-2 Certificates immediately prior to such Distribution Date over (ii) the
lesser of (A) 69.70% of the Current Maximum Amount for such Distribution Date
and (B) the excess, if any, of the Current Maximum Amount for such Distribution
Date over $4,575,000.
Class M-3 Certificates: All Certificates bearing the class
designation of "Class M-3".
Class M-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount for such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal Distribution
Amount for such Distribution Date), (C) the Class Certificate Balance of the
Class M-2 Certificates (after taking into account the distribution of the
Class M-2 Principal Distribution Amount for such Distribution Date) and (D) the
Class Certificate Balance of the Class M-3 Certificates immediately prior to
such Distribution Date over (ii) the lesser of (A) 73.70% of the Current Maximum
Amount for such Distribution Date and (B) the excess, if any, of the Current
Maximum Amount for such Distribution Date over $4,575,000.
Class M-4 Certificates: All Certificates bearing the class
designation of "Class M-4".
Class M-4 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount for such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal Distribution
Amount for such Distribution Date), (C) the Class Certificate Balance of the
Class M-2 Certificates (after taking into account the distribution of the
Class M-2 Principal Distribution Amount for such Distribution Date), (D) the
Class Certificate Balance of the Class M-3 Certificates (after taking into
account the distribution of the Class M-3 Principal Distribution Amount for such
Distribution Date) and (E) the Class Certificate Balance of the Class M-4
Certificates immediately prior to such Distribution Date over (ii) the lesser of
(A) 77.20% of the Current Maximum Amount for such Distribution Date and (B) the
excess, if any, of the Current Maximum Amount for such Distribution Date over
$4,575,000.
Class M-5 Certificates: All Certificates bearing the class
designation of "Class M-5".
Class M-5 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) aggregate Class Certificate
Balance of the Class A Certificates (after taking into account the distribution
of the Class A Principal Distribution Amount for such Distribution Date),
(B) the Class Certificate Balance of the Class M-1 Certificates (after taking
into account the distribution of the Class M-1 Principal Distribution Amount for
such Distribution Date), (C) the Class Certificate Balance of the Class M-2
Certificates (after taking into account the distribution of the Class M-2
Principal Distribution Amount for such Distribution Date), (D) the Class
Certificate Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount for such
Distribution Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after taking into account the distribution of the Class M-4
Principal Distribution Amount for such Distribution Date) and (F) the Class
Certificate Balance of the Class M-5 Certificates immediately prior to such
Distribution Date over (i) the lesser of (A) 80.60% of the Current Maximum
Amount for such Distribution Date and (B) the excess, if any, of the Current
Maximum Amount for such Distribution Date over $4,575,000.
Class M-6 Certificates: All Certificates bearing the class
designation of "Class M-6".
Class M-6 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount for such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal Distribution
Amount for such Distribution Date), (C) the Class Certificate Balance of the
Class M-2 Certificates (after taking into account the distribution of the
Class M-2 Principal Distribution Amount for such Distribution Date), (D) the
Class Certificate Balance of the Class M-3 Certificates (after taking into
account the distribution of the Class M-3 Principal Distribution Amount for such
Distribution Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after taking into account the distribution of the Class M-4
Principal Distribution Amount for such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount for such
Distribution Date) and (G) the Class Certificate Balance of the Class M-6
Certificates immediately prior to such Distribution Date over (ii) the lesser of
(A) 83.80% of the Current Maximum Amount for such Distribution Date and (B) the
excess, if any, of the Current Maximum Amount for such Distribution Date over
$4,575,000.
Class P Certificates: All Certificates bearing the class
designation of "Class P".
Class PF-IO Interest: The regular interest in the Class X REMIC
represented by the Class X Certificates as specified and described in the
Preliminary Statement and the related footnote thereto.
Class PF-R Interest: The residual interest in REMIC PF as described
in the Preliminary Statement and the related footnote thereto.
Class PT1-R Interest: The residual interest in Pooling-Tier REMIC-1
as described in the Preliminary Statement and the related footnote thereto.
Class PT2-R Interest: The residual interest in Pooling-Tier REMIC-2
as described in the Preliminary Statement and the related footnote thereto.
Class R Certificates: All Certificates bearing the class
designation of "Class R".
Class RX Certificates: All Certificates bearing the class
designation of "Class RX".
Class UT-IO Interest: A regular interest in the Upper-Tier REMIC as
described in the Preliminary Statement and the related footnote thereto.
Class UT-PFIO Interest: A regular interest in the Upper-Tier REMIC
as described in the Preliminary Statement and the related footnote thereto.
Class UT-R Interest: The residual interest in the Upper-Tier REMIC
as described in the Preliminary Statement and the related footnote thereto.
Class UT-X Interest: A regular interest in the Upper-Tier REMIC as
described in the Preliminary Statement and the related footnote thereto.
Class X Certificates: All Certificates bearing the class
designation of "Class X".
Class X Distributable Amount: On any Distribution Date, the sum of
(i) as a distribution in respect of interest, the amount of interest that has
accrued on the Class UT-X Interest and Class UT-PFIO Interest and not applied as
an Extra Principal Distribution Amount on such Distribution Date, plus any such
accrued interest remaining undistributed from prior Distribution Dates, plus,
without duplication, (ii) as a distribution in respect of principal, any portion
of the principal balance of the Class UT-X Interest which is distributable as a
Subordination Reduction Amount, minus (iii) any amounts paid from the Excess
Reserve Fund Account to pay Basis Risk Carry Forward Amounts, and any Defaulted
Swap Termination Payment payable from Available Funds to the Swap Provider.
Class X Interest: The regular interest in the Class X REMIC
represented by the Class X Certificates as specified and described in the
Preliminary Statement and the related footnote thereto.
Class X REMIC: As defined in the Preliminary Statement.
Class X REMIC Regular Interest: Each of the Class X Interest,
Class PF-IO Interest and Class IO Interest issued by the Class X REMIC.
Closing Date: April 30, 2007.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
Collection Accounts: As defined in Section 3.10(a).
Commission: The United States Securities and Exchange Commission.
Compensating Interest: For any Distribution Date, the lesser of
(a) the amount by which the Prepayment Interest Shortfall resulting from
Principal Prepayments in Full exceeds all Prepayment Interest Excesses for such
Distribution Date (excluding any Principal Prepayments in Full made upon
liquidation of a Mortgage Loan) and (b) the Servicing Fee paid to or retained by
the Servicer for such Distribution Date.
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.
Corporate Trust Office: With respect to the Securities
Administrator (i) for the transfer, presentation or surrender of Certificates,
the office at Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000,
Attention: Corporate Trust Services - Natixis 2007-HE2, and (ii) for all other
purposes 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention:
Corporate Trust Services Natixis 2007-HE2. The designated office in the State
of California at which at any particular time the Trustee's corporate trust
business with respect to this Agreement is administered, which office at the
date of the execution of this Agreement is located at 0000 Xxxx Xx. Xxxxxx
Xxxxx, Xxxxx Xxx, Xxxxxxxxxx 00000, Attn: Trust Administration IX0702,
facsimile no. (000) 000-0000 and which is the address to which notices to and
correspondence with the Trustee should be directed.
Corresponding Class: The class of interests in the Lower-Tier REMIC
or Upper-Tier REMIC that corresponds to the class of interests in the other such
REMIC or to a Class of Certificates in the manner set out below:
Corresponding Lower-Tier Corresponding Upper-Tier Corresponding Class
Class Designation Regular Interest of Certificates
------------------------ ------------------------ -------------------
Class LT-A-1 Class A-1 Class A-1
Class LT-A-2 Class A-2 Class A-2
Class LT-A-3 Class A-3 Class A-3
Class LT-A-4 Class A-4 Class A-4
Class LT-M-1 Class M-1 Class M-1
Class LT-M-2 Class M-2 Class M-2
Class LT-M-3 Class M-3 Class M-3
Class LT-M-4 Class M-4 Class M-4
Class LT-M-5 Class M-5 Class M-5
Class LT-M-6 Class M-6 Class M-6
Class LT-B-1 Class B-1 Class B-1
Class LT-B-2 Class B-2 Class B-2
Class LT-B-3 Class B-3 Class B-3
Class LT-B-4 Class B-4 Class B-4
Corresponding Pooling-Tier REMIC-1 Regular Interest: As described
in the Preliminary Statement.
--------------------------------------------------------------------------------
Corresponding Pooling-Tier REMIC-2 IO Interest: As described in the
Preliminary Statement.
Corresponding Scheduled Crossover Distribution Date: The
Distribution Date in the month and year specified in the Preliminary Statement
corresponding to a Pooling-Tier REMIC-2 IO Interest.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard and Poor's Glossary.
Cumulative Loss Percentage: With respect to any Distribution Date,
the percentage equivalent of a fraction, the numerator of which is the aggregate
amount of Realized Losses incurred from the Cut-off Date through the last day of
the related Prepayment Period and the denominator of which is the Cut-off Date
Pool Principal Balance of the Mortgage Loans.
Cumulative Loss Trigger Event: With respect to any Distribution
Date, a Cumulative Loss Trigger Event exists if the quotient (expressed as a
percentage) of the aggregate amount of Realized Losses incurred since the
related Cut-off Date through the last day of the related Prepayment Period
divided by the Maximum Pool Principal Balance exceeds the applicable cumulative
loss percentages set forth below with respect to such Distribution Date:
Distribution Date Occurring In Cumulative Loss Percentage
------------------------------ --------------------------
May 2009 through April 2010 1.650% for the first month, plus
an additional 1/12th of 2.000% for
each month thereafter (e.g.,
2.650% in November 2009)
May 2010 through April 2011 3.650% for the first month, plus
an additional 1/12th of 2.000% for
each month thereafter (e.g.,
4.650% in November 2010)
May 2011 through April 2012 5.650% for the first month, plus
an additional 1/12th of 1.650% for
each month thereafter (e.g.,
6.475% in November 2011)
May 2012 through April 2013 7.300% for the first month, plus
an additional 1/12th of 0.850% for
each month thereafter (e.g.,
7.725% in November 2012)
May 2013 and thereafter 8.150%
Current Maximum Amount: With respect to any Distribution Date, the
sum of (i) the aggregate of the Stated Principal Balance of the Mortgage Loans
held by the Trust for such Distribution Date, and (ii) with respect to each
Distribution Date prior to July 25, 2007, the aggregate amount on deposit, the
Pre-Funding Account on that Distribution Date, net of investment earnings on
deposit therein.
--------------------------------------------------------------------------------
Custodial File: With respect to each Mortgage Loan, the file
retained by the Custodian consisting of items (i)-(viii) of Section 2.01(b) as
listed on Exhibit L hereto.
Custodian: Deutsche Bank National Trust Company, a national banking
association, and its successors in interest.
Cut-off Date: With respect to the Initial Mortgage Loans, April 1,
2007, and with respect to each Subsequent Mortgage Loan, the related Subsequent
Cut-off Date.
Cut-off Date Pool Principal Balance: The aggregate of the Cut-off
Date Principal Balances of all Mortgage Loans, plus the portion of the Closing
Date Deposit Amount allocable to principal.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date (after
giving effect to payments of principal due on or prior to that date, whether or
not received).
Data Tape Information: The information provided by the Unaffiliated
Seller as of April 1, 2007 to the Depositor setting forth the following
information with respect to each Mortgage Loan: (1) the Mortgagor's name;
(2) as to each Mortgage Loan, the Scheduled Principal Balance as of the Cut-off
Date; (3) the Mortgage Rate Cap; (4) the Index; (5) a code indicating whether
the Mortgaged Property is owner-occupied; (6) the type of Mortgaged Property;
(7) the first date on which the Scheduled Payment was due on the Mortgage Loan
and, if such date is not consistent with the Due Date currently in effect, such
Due Date; (8) the "paid through date" based on payments received from the
related Mortgagor; (9) the original principal amount of the Mortgage Loan;
(10) with respect to Adjustable Rate Mortgage Loans, the Maximum Mortgage Rate;
(11) the type of Mortgage Loan (i.e., Fixed Rate Mortgage Loan, Adjustable Rate
Mortgage Loan, First Lien Mortgage Loan or Second Lien Mortgage Loan); (12) a
code indicating the purpose of the loan (i.e., purchase, rate and term
refinance, equity take-out refinance); (13) a code indicating the documentation
style (i.e., full, asset verification, income verification and no
documentation); (14) the credit risk score (FICO score); (15) the loan credit
grade classification (as described in the Underwriting Guidelines); (16) with
respect to each Adjustable Rate Mortgage Loan, the Minimum Mortgage Rate;
(17) the Mortgage Rate at origination; (18) with respect to each Adjustable Rate
Mortgage Loan, the first Adjustment Date immediately following the Cut-off Date;
(19) the value of the Mortgaged Property; (20) a code indicating the type and
term of Prepayment Charges applicable to such Mortgage Loan, if any; and
(21) with respect to each Adjustable Rate Mortgage Loan, the Periodic Mortgage
Rate Cap. With respect to the Mortgage Loans in the aggregate, the Data Tape
Information shall set forth the following information, as of the 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 Rate
of the Mortgage Loans; and (4) the weighted average maturity of the Mortgage
Loans.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent jurisdiction in a proceeding under the United
States Bankruptcy Code in the Scheduled Payment for such Mortgage Loan which
became final and non-appealable, except such a reduction resulting from a
Deficient Valuation or any reduction that results in a permanent forgiveness of
principal.
Defaulted Swap Termination Payment: Any Swap Termination Payment
required to be paid by the Supplemental Interest Trust to the Swap Provider
pursuant to the Interest Rate Swap Agreement as a result of an Event of Default
(as defined in the Interest Rate Swap Agreement) with respect to which the Swap
Provider is the Defaulting Party (as defined in the Interest Rate Swap
Agreement) or a Termination Event (as defined in the Interest Rate Swap
Agreement) (other than Illegality or a Tax Event that is not a Tax Event Upon
Merger (each as defined in the Interest Rate Swap Agreement )) with respect to
which the Swap Provider is the sole Affected Party (as defined in the Interest
Rate Swap Agreement).
Deficiency Collection: As defined in Section 3.07(o).
Deficiency Collection Agent: As defined in Section 3.07(o).
Deficient Valuation: With respect to any Mortgage Loan, a valuation
of the related Mortgaged Property by a court of competent jurisdiction in an
amount less than the then- outstanding principal balance of the Mortgage Loan,
which valuation results from a proceeding initiated under the United States
Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased by the
Unaffiliated Seller or the related Originator, as applicable, or replaced with a
Substitute Mortgage Loan in accordance with the terms hereof and/or the
applicable Mortgage Loan Purchase Agreement.
Delinquency Trigger Event: With respect to any Distribution Date,
the event that is in effect if the quotient (expressed as a percentage) of
(x) the three-month rolling daily average of the aggregate unpaid principal
balance of 60+ Day Delinquent Mortgage Loans as of the last day of the related
Due Period, over (y) the Current Maximum Amount of the Mortgage Loans as of the
last day of the related Due Period equals or exceeds (a) 36.20% of the prior
period's Senior Enhancement Percentage while any Class A Certificates remain
outstanding, or (b) 43.25% of the prior period's Class M-1 Enhancement
Percentage if the Class A Certificates are no longer outstanding.
Delivery Date: With respect to the Initial Mortgage Loans,
the Closing Date; with respect to any Subsequent Mortgage Loans, the applicable
Subsequent Transfer Date therefor.
Denomination: With respect to each Certificate, the amount set
forth on the face thereof as the "Initial Certificate Balance of this
Certificate" or the Percentage Interest appearing on the face thereof.
Depositor: Xxxxxx Xxxxxxx ABS Capital I Inc., a Delaware
corporation, and its successors in interest.
Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as 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 Institution: Any depository institution or trust
company, including the Securities Administrator, that (a) is incorporated under
the laws of the United States of America or any State thereof, (b) is subject to
supervision and examination by federal or state banking authorities and (c) has
outstanding unsecured commercial paper or other short-term unsecured debt
obligations that are rated "P-1" by Moody's, "F1+" by Fitch and "A-1" by
Standard & Poor's (to the extent they are Rating Agencies hereunder).
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.
Determination Date: With respect to each Distribution Date, the
15th of each month, or if the 15th is not a Business Day, the immediately
preceding Business Day.
Distribution Account: The separate Eligible Account created and
maintained by the Securities Administrator pursuant to Section 3.07(d) in the
name of the Securities Administrator for the benefit of the Certificateholders
and designated "Xxxxx Fargo Bank, National Association, in trust for registered
holders of Natixis Real Estate Capital Trust 2007-HE2, Mortgage Pass-Through
Certificates, Series 2007-HE2". Funds in the Distribution Account shall be held
in trust for the Certificateholders for the uses and purposes set forth in this
Agreement.
Distribution Date: The 25th day of each calendar month, or if such
day is not a Business Day, the next succeeding Business Day, commencing in
May 2007.
Document Certification and Exception Report: The report attached to
Exhibit F hereto.
Due Date: The day of the month on which the Scheduled Payment is
due on a Mortgage Loan, exclusive of any days of grace.
Due Period: With respect to any Distribution Date, the period
commencing on the second day of the calendar month preceding the month in which
such Distribution Date occurs and ending 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
commercial paper, short-term debt obligations, demand deposits or other
short-term deposits of which are rated in one of the two highest rating
categories by each of the Rating Agencies at the time any amounts are held on
deposit therein, (ii) an account or accounts the deposits in which are fully
insured by the FDIC (to the limits established by such corporation), the
uninsured deposits in which account are otherwise secured such that, as
evidenced by an Opinion of Counsel delivered to each Rating Agency, the
Certificateholders will have a claim with respect to the funds in such account
or a perfected first priority security interest against such 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
with which such account is maintained, (iii) a trust account or accounts
maintained with the trust department of a federal or state chartered depository
institution, national banking association or trust company acting in its
fiduciary capacity, (iv) an account otherwise acceptable to each Rating Agency
or (v) an account maintained with a "qualified depository". Eligible Accounts
may bear interest.
Eligible Institution: A federal or state chartered depository
institution or trust company, which (x) with respect to any Eligible Account,
the amounts on deposit in which will be held for less than 30 days, the
commercial paper, short-term debt obligations, or other short-term deposits of
which are rated at least "F1" by Fitch, "P-1" by Moody's, and either "A-1+" or
"A-1", if the amounts on deposit represent less than 20% of the initial par
value of the securities, are not intended to be used as credit enhancement and
are to be held for less than 30 days, by Standard & Poor's (or a comparable
rating if another Rating Agency is specified by the Depositor by written notice
to the Servicer and the Securities Administrator) or (y) with respect to any
Eligible Account, the amounts on deposit in which will be held for no more than
365 days, the long-term unsecured debt obligations of which are rated at least
"A" by Fitch, "A" by Standard & Poor's and "A2" by Moody's (or a comparable
rating if another Rating Agency is specified by the Depositor by written notice
to the Servicer and the Securities Administrator).
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.09(b).
Escrow Payments: As defined in Section 3.09(b).
Event of Default: As defined in Section 7.01.
Excess Reserve Fund Account: The separate Eligible Account created
and maintained by the Securities Administrator pursuant to Sections 3.07(b) and
3.07(c) in the name of the Securities Administrator, on behalf of the
Supplemental Interest Trust, for the benefit of the Holders of the Regular
Certificates and designated "Xxxxx Fargo Bank, National Association, in trust
for registered holders of Natixis Real Estate Capital Trust 2007-HE2, Mortgage
Pass-Through Certificates, Series 2007-HE2". Funds in the Excess Reserve Fund
Account shall be held in trust for the Holders of the Regular Certificates for
the uses and purposes set forth in this Agreement. Amounts on deposit in the
Excess Reserve Fund Account shall not be invested.
Excess Subordinated Amount: With respect to any Distribution Date,
the excess, if any, of (a) the Subordinated Amount on such Distribution Date
over (b) the Specified Subordinated Amount for such Distribution Date.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Expense Fee Rate: As to each Mortgage Loan, a per annum rate equal
to the sum of the Servicing Fee Rate and the Securities Administrator and Master
Servicer Fee Rate.
Expense Fees: As to each Mortgage Loan, the sum of the Servicing
Fee and the Securities Administrator and Master Servicer Fee.
Extra Principal Distribution Amount: As of any Distribution Date,
the lesser of (x) the related Total Monthly Excess Spread for such Distribution
Date and (y) the Subordination Deficiency for such Distribution Date.
Xxxxxx Xxx: The Federal National Mortgage Association, or any
successor thereto.
Xxxxxx Mae Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Mae
Servicers' Guide and all amendments or additions thereto.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
Final Certification: A certification submitted by the Custodian in
substantially the form of Exhibit G hereto.
Final Recovery Determination: With respect to any defaulted
Mortgage Loan or any REO Property (other than a Mortgage Loan or REO Property
purchased by an Originator as contemplated by the Assignment and Recognition
Agreements), a determination made by the Servicer that all Insurance Proceeds,
Condemnation Proceeds, Liquidation Proceeds and other payments or recoveries
which the Servicer, in its reasonable good faith judgment, expects to be finally
recoverable in respect thereof have been so recovered. The Servicer shall
maintain records, prepared by a Servicing Officer, of each Final Recovery
Determination made thereby.
Final Scheduled Distribution Date: The Final Scheduled Distribution
Date for each Class of Certificates is the Distribution Date in July 2037.
First Horizon: First Horizon Home Loan Corporation, a Kansas
corporation, and its successors in interest.
First Horizon Agreements: The First Horizon Purchase Agreement and
the First Horizon Assignment Agreement, copies of which are attached hereto as
Exhibit DD.
First Horizon Assignment Agreement: The Assignment and Recognition
Agreement, dated as of April 30, 2007, by and among the Unaffiliated Seller, the
Depositor and First Horizon, and each other Assignment and Recognition Agreement
by and among the Unaffiliated Seller, the Depositor and First Horizon in
connection with any Subsequent Transfer of First Horizon Mortgage Loans.
First Horizon Mortgage Loan: A Mortgage Loan which was acquired
from First Horizon by the Unaffiliated Seller pursuant to the First Horizon
Purchase Agreement, and which has been acquired by the Trust Fund.
First Horizon Purchase Agreement: The Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of July 1, 2006, as
amended to date, by and between the Unaffiliated Seller and First Horizon.
First Lien Mortgage Loan: A Mortgage Loan secured by a first lien
Mortgage on the related Mortgaged Property.
First NLC: First NLC Financial Services, LLC, a Florida limited
liability company, and its successors in interest.
First NLC Agreements: The First NLC Purchase Agreement and the
First NLC Assignment Agreement, copies of which are attached hereto as
Exhibit EE.
First NLC Assignment Agreement: The Assignment and Recognition
Agreement, dated as of April 30, 2007, by and among the Unaffiliated Seller, the
Depositor and First NLC, and each other Assignment and Recognition Agreement by
and among the Unaffiliated Seller, the Depositor and First NLC in connection
with any Subsequent Transfer of First Bank Mortgage Loans.
First NLC Mortgage Loan: A Mortgage Loan which was acquired from
First NLC by the Unaffiliated Seller pursuant to the First NLC Purchase
Agreement, and which has been acquired by the Trust Fund.
First NLC Purchase Agreement: The Third Amended Mortgage Loan
Purchase and Warranties Agreement, dated as of May 1, 2006, as amended to date,
by and between the Unaffiliated Seller and First NLC.
Fitch: Fitch, Inc., and its successors in interest. If Fitch is
designated as a Rating Agency in the Preliminary Statement, for purposes of
Section 12.05 the address for notices to Fitch shall be Fitch, Inc., Xxx Xxxxx
Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Mortgage
Surveillance Group - Natixis Real Estate Capital Trust 2007-HE2, or such other
address as Fitch may hereafter furnish to the Depositor, the Securities
Administrator, the Trustee and the Servicer.
Fixed Rate Mortgage Loan: A fixed rate Mortgage Loan.
FlexPoint: FlexPoint Funding Corporation, a California corporation,
and its successors in interest.
FlexPoint Agreements: The FlexPoint Purchase Agreement and the
FlexPoint Assignment Agreement, copies of which are attached hereto as
Exhibit FF.
FlexPoint Assignment Agreement: The Assignment and Recognition
Agreement, dated as of April 30, 2007, by and among the Unaffiliated Seller, the
Depositor and FlexPoint, and each other Assignment and Recognition Agreement by
and among the Unaffiliated Seller, the Depositor and FlexPoint in connection
with any Subsequent Transfer of FlexPoint Mortgage Loans.
FlexPoint Mortgage Loan: A Mortgage Loan which was acquired from
FlexPoint by the Unaffiliated Seller pursuant to the FlexPoint Purchase
Agreement, and which has been acquired by the Trust Fund.
FlexPoint Purchase Agreement: The Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of February 1, 2006,
as amended to date, by and between the Unaffiliated Seller and FlexPoint.
Xxxxxxx Mac: The Federal Home Loan Mortgage Corporation, a
corporate instrumentality of the United States created and existing under Title
III of the Emergency Home Finance Act of 1970, as amended, or any successor
thereto.
Funding America: Funding America Mortgage Warehouse Trust, a
Delaware statutory trust and/or Funding America Mortgage Warehouse Trust I, a
Delaware statutory trust, each a wholly owned subsidiary of Funding America,
LLC, and their respective successors in interest.
Funding America Agreements: The Funding America Purchase Agreement
and the Funding America Assignment Agreement, copies of which are attached
hereto as Exhibit GG.
Funding America Assignment Agreement: The Assignment and
Recognition Agreement, dated as of April 30, 2007, by and among the Unaffiliated
Seller, the Depositor and Funding America, and each other Assignment and
Recognition Agreement by and among the Unaffiliated Seller, the Depositor and
Funding America in connection with any Subsequent Transfer of Funding America
Mortgage Loans.
Funding America Mortgage Loan: A Mortgage Loan which was acquired
from Funding America by the Unaffiliated Seller pursuant to the Funding America
Purchase Agreement, and which has been acquired by the Trust Fund.
Funding America Purchase Agreement: The Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of October 1, 2006, as
amended to date, by and between the Unaffiliated Seller and Funding America
Mortgage Warehouse Trust, and the Mortgage Loan Purchase and Warranties
Agreement, dated as of October 1, 2006, by and between the Unaffiliated Seller,
Ocwen Loan Servicing LLC and Funding America Mortgage Warehouse Trust I.
Grantor Trust: As described in the Preliminary Statement.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan,
the fixed percentage amount set forth in the related Mortgage Note to be added
to the applicable Index to determine the Mortgage Rate.
High Cost Loan: A Mortgage Loan classified as (a) a "high cost"
loan under the Home Ownership and Equity Protection Act of 1994, (b) a "high
cost home," "threshold," "covered," (excluding New Jersey "Covered Home Loans"
as that term is defined in clause (1) of the definition of that term in the New
Jersey Home Ownership Security Act of 2002), "high risk home," "predatory" or
similar loan under any other 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) or (c) a Mortgage
Loan categorized as High Cost pursuant to Appendix E of Standard & Poor's
Glossary.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
Index: As to each Adjustable Rate Mortgage Loan, the index from
time to time in effect for the adjustment of the Mortgage Rate set forth as such
on the related Mortgage Note.
Initial Cut-off Date: April 1, 2007.
Initial Mortgage Loans: The Mortgage Loans delivered by the
Depositor on the Startup Day.
Initial Pre-Funded Amount: $165,089,428.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Fund, any insurance policy, including all riders and endorsements thereto
in effect, including any replacement policy or policies for any Insurance
Policies.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Accrual Period: With respect to each Class of Non-Delay
Certificates and the Corresponding Class of Lower-Tier Regular Interests and any
Distribution Date, the period commencing on the Distribution Date occurring in
the month preceding the month in which the current Distribution Date occurs (or,
in the case of the first Distribution Date, the period from and including the
Closing Date to but excluding such first Distribution Date) and ending on the
day immediately preceding the current Distribution Date. With respect to the
Class LT-Accrual, Class LT-IO, Class LT-PFIO, Class UT-X, Class UT-IO,
Class UT-PFIO, Class X, Class PF-IO and Class IO Interests and each REMIC PF
Regular Interest, Pooling-Tier REMIC-1 Regular Interest and Pooling-Tier REMIC-2
Regular Interest and any Distribution Date, the calendar month preceding such
Distribution Date. For purposes of computing interest accruals on each Class of
Non-Delay Certificates, other class of Upper-Tier Regular Interests, each class
of Class X REMIC Regular Interests, each Class of Lower-Tier Regular Interests,
and each REMIC PF Regular Interests, Pooling-Tier REMIC-1 Interest and
Pooling-Tier REMIC-2 Interest, each Interest Accrual Period has the actual
number of days in such month and each year is assumed to have 360 days.
Interest Rate Cap Agreement: The interest rate cap agreement
relating to the LIBOR Certificates dated as of the Closing Date, between the Cap
Provider and the Securities Administrator on behalf of the Supplemental Interest
Trust, a copy of which is attached hereto as Exhibit Y.
Interest Rate Cap Payment: With respect to any Distribution Date,
the payment, if any, required to be made by the Cap Provider under the Interest
Rate Cap Agreement with respect to such Distribution Date.
Interest Rate Swap Agreement: The interest rate swap agreement
dated as of the Closing Date, between the Swap Provider and the Securities
Administrator on behalf of the Supplemental Interest Trust, a copy of which is
attached hereto as Exhibit X.
Interest Remittance Amount: With respect to any Distribution Date
and the Mortgage Loans, that portion of Available Funds attributable to interest
received or advanced on such Mortgage Loans, net of the fees payable to the
Servicer, the Master Servicer and the Securities Administrator, and net of any
Net Swap Payments and any Swap Termination Payments, other than Defaulted Swap
Termination Payments, payable to the Swap Provider from Available Funds with
respect to that Distribution Date.
Investment Account: As defined in Section 3.12(a).
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the investor pursuant to the MERS
Procedures Manual.
Investor-Based Exemption: Any of Prohibited Transaction
Class Exemption ("PTCE") 84-14 (for transactions by independent "qualified
professional asset managers"), PTCE 90-1 (for transactions by insurance company
pooled separate accounts), PTCE 91-38 (for transactions by bank collective
investment funds), PTCE 95-60 (for transactions by insurance company general
accounts) or PTCE 96-23 (for transactions effected by "in house asset
managers"), or any comparable exemption available under Similar Law.
Late Collections: With respect to any Mortgage Loan and any Due
Period, all amounts received after the Determination Date immediately following
such Due Period, whether as late payments of Scheduled Payments or as Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds or otherwise, which
represent late payments or collections of principal and/or interest due (without
regard to any acceleration of payments under the related Mortgage and Mortgage
Note) but delinquent for such Due Period and not previously recovered.
Lenders Direct: Lenders Direct Capital Corp., a California
corporation, and its successors in interest.
Lenders Direct Mortgage Loan: A Mortgage Loan which was acquired
from Lenders Direct by the Unaffiliated Seller pursuant to the Lenders Direct
Purchase Agreement, and which has been acquired by the Trust Fund.
Lenders Direct Purchase Agreement: The Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of December 1, 2005,
as amended to date, by and between the Unaffiliated Seller and Lenders Direct, a
copy of which is attached hereto as Exhibit HH.
LIBOR: With respect to any Interest Accrual Period for the LIBOR
Certificates, the rate determined by the Securities Administrator on the related
LIBOR Determination Date on the basis of the offered rate for one-month U.S.
dollar deposits as such rate appears on Reuters Page LIBOR01 as of 11:00 a.m.
(London time) on such date; provided that if such rate does not appear on
Reuters Page LIBOR01, the rate for such date will be determined on the basis of
the rates at which one-month U.S. dollar deposits are offered by the Reference
Banks at approximately 11:00 a.m. (London time) on such date to prime banks in
the London interbank market. In such event, the Securities Administrator shall
request the principal London office of each of the Reference Banks to provide a
quotation of its rate. If at least two such quotations are provided, the rate
for that date will be the arithmetic mean of the quotations (rounded upwards if
necessary to the nearest whole multiple of 1/16%). If fewer than two quotations
are provided as requested, the rate for that date will be the arithmetic mean of
the rates quoted by major banks in New York City, selected by the Securities
Administrator, after consultation with the Depositor, at approximately 11:00
a.m. (New York City time) on such date for one-month U.S. dollar loans to
leading European banks.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: With respect to any Interest Accrual
Period for the LIBOR Certificates, the second London Business Day preceding the
commencement of such Interest Accrual Period.
Lime Financial: Lime Financial Services, Ltd., an Oregon
corporation, and its successors in interest.
Lime Financial Agreements: The Lime Financial Purchase Agreement
and the Lime Financial Assignment Agreement, copies of which are attached hereto
as Exhibit II
Lime Financial Assignment Agreement: The Assignment and Recognition
Agreement, dated as of April 30, 2007, by and among the Unaffiliated Seller, the
Depositor and Lime Financial, and each other Assignment and Recognition
Agreement by and among the Unaffiliated Seller, the Depositor and Lime Financial
in connection with any Subsequent Transfer of Lime Financial Mortgage Loans.
Lime Financial Mortgage Loan: A Mortgage Loan which was acquired
from Lime Financial by the Unaffiliated Seller pursuant to the Lime Financial
Purchase Agreement, and which has been acquired by the Trust Fund.
Lime Financial Purchase Agreement: The Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of April 27, 2006, as
amended to date, by and between the Unaffiliated Seller and Lime Financial.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which either (a) was
liquidated in the calendar month preceding the month of such Distribution Date
and as to which the Servicer has certified to the Securities Administrator and
the Master Servicer that it has received all amounts it expects to receive in
connection with the liquidation of such Mortgage Loan including the final
disposition of an REO Property or (b) is a Second Lien Mortgage Loan (1) that is
delinquent 180 days or longer, (2) for which the related first lien mortgage
loan is not a Mortgage Loan, and (3) as to which the Servicer has certified to
the Master Servicer that it does not believe there is a reasonable likelihood
that any further net proceeds will be received or recovered with respect to such
Second Lien Mortgage Loan.
Liquidation Proceeds: Cash received in connection with the
liquidation of a Liquidated Mortgage Loan, whether through a trustee's sale,
foreclosure sale or otherwise, including any Subsequent Recoveries.
Loan-to-Value Ratio or LTV: With respect to any First Lien Mortgage
Loan, the ratio (expressed as a percentage) of the original outstanding
principal amount of the First Lien Mortgage Loan as of the Cut-off Date (unless
otherwise indicated), to the lesser of (a) the Appraised Value of the Mortgaged
Property at origination, and (b) if the First Lien Mortgage Loan was made to
finance the acquisition of the related Mortgaged Property, the purchase price of
the Mortgaged Property.
London Business Day: Any day on which dealings in deposits of
United States dollars are transacted in the London interbank market.
Lower-Tier Interest Rate: As described in the Preliminary Statement.
Lower-Tier Principal Amount: As described in the Preliminary
Statement.
Lower-Tier Regular Interest: Each of the Class LT-A-1,
Class LT-A-2, Class LT-A-3, Class LT-A-4, Class LT-M-1, Class LT-M-2,
Class LT-M-3, Class LT-M-4, Class LT-M-5, Class LT-M-6, Class LT-B-1,
Class LT-B-2, Class LT-B-3, Class LT-B-4, Class LT-IO, Class LT-PFIO and
Class LT-Accrual Interests as described in the Preliminary Statement.
Lower-Tier REMIC: As described in the Preliminary Statement.
Mandalay: Mandalay Mortgage, LLC, a Delaware limited liability
company, and its successors in interest.
Mandalay Mortgage Loan: A Mortgage Loan which was acquired from
Mandalay by the Unaffiliated Seller pursuant to the Mandalay Purchase Agreement,
and which has been acquired by the Trust Fund.
Mandalay Purchase Agreement: The Amended and Restated Mortgage Loan
Purchase and Warranties Agreement, dated as of June 1, 2006, as amended to date,
by and between the Unaffiliated Seller and Mandalay, a copy of which is attached
hereto as Exhibit JJ.
Master Financial: Master Financial, Inc., a California corporation,
and its successors in interest.
Master Financial Agreements: The Master Financial Purchase
Agreement and the Master Financial Assignment Agreement, copies of which are
attached hereto as Exhibit KK.
Master Financial Assignment Agreement: The Assignment and
Recognition Agreement, dated as of April 30, 2007, by and among the Unaffiliated
Seller, the Depositor and Master Financial, and each other Assignment and
Recognition Agreement by and among the Unaffiliated Seller, the Depositor and
Master Financial in connection with any Subsequent Transfer of Master Financial
Mortgage Loans.
Master Financial Mortgage Loan: A Mortgage Loan which was acquired
from Master Financial by the Unaffiliated Seller pursuant to the Master
Financial Purchase Agreement, and which has been acquired by the Trust Fund.
Master Financial Purchase Agreement: The Second Amended and
Restated Mortgage Loan Purchase and Warranties Agreement, dated as of
February 1, 2006, as amended to date, by and between the Unaffiliated Seller and
Master Financial.
Master Servicer: Xxxxx Fargo Bank, National Association, a banking
association organized under the laws of the United States, and its successors in
interest and, if a successor master servicer is appointed hereunder, such
successor master servicer.
Master Servicer Event of Default: As defined in Section 9.04.
Master Servicing Officer: Any officer of the Master Servicer
involved in, or responsible for, the administration and master servicing of the
Mortgage Loans.
Maxim: Maxim Mortgage Corp., a Texas corporation, and its
successors in interest.
Maxim Agreements: The Maxim Purchase Agreement and the Maxim
Assignment Agreement, copies of which are attached hereto as Exhibit LL.
Maxim Assignment Agreement: The Assignment and Recognition
Agreement, dated as of April 30, 2007, by and among the Unaffiliated Seller, the
Depositor and Maxim, and each other Assignment and Recognition Agreement by and
among the Unaffiliated Seller, the Depositor and Maxim in connection with any
Subsequent Transfer of Maxim Mortgage Loans.
Maxim Mortgage Loan: A Mortgage Loan which was acquired from Maxim
by the Unaffiliated Seller pursuant to the Maxim Purchase Agreement, and which
has been acquired by the Trust Fund.
Maxim Purchase Agreement: The Mortgage Loan Purchase and Warranties
Agreement, dated as of August 1, 2006, as amended to date, by and between the
Unaffiliated Seller and Maxim.
Maximum Mortgage Rate: With respect to each Adjustable Rate
Mortgage Loan, a rate that (i) is set forth on the Data Tape Information and in
the related Mortgage Note and (ii) is the maximum interest rate to which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be increased during the
lifetime of such Adjustable Rate Mortgage Loan.
Maximum Pool Principal Balance: The aggregate Stated Principal
Balance of all Initial Mortgage Loans as of the Initial Cut-off Date plus the
Initial Pre-Funded Amount.
MERS: Mortgage Electronic Registration System, Inc.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the
Originators have designated or will designate MERS as, and have taken or will
take such action as is necessary to cause MERS to be, the mortgagee of record,
as nominee for the Originators, in accordance with the MERS Procedure Manual and
(b) the Originators have designated or will designate the Trustee as the
Investor on the MERS(R) System.
MERS Procedures Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS(R) System: The MERS mortgage electronic registry system, as
more particularly described in the MERS Procedures Manual.
Minimum Mortgage Rate: With respect to each Adjustable Rate
Mortgage Loan, a rate that (i) is set forth on the Data Tape Information and in
the related Mortgage Note and (ii) is the minimum interest rate to which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be decreased during the
lifetime of such Adjustable Rate Mortgage Loan.
Monthly Statement: The statement delivered to the
Certificateholders pursuant to Section 4.03(a).
Moody's: Xxxxx'x Investors Service, Inc, and its successors in
interest. If Xxxxx'x is designated as a Rating Agency in the Preliminary
Statement, for purposes of Section 12.05(b) the address for notices to Moody's
shall be Xxxxx'x Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Residential Mortgage Pass-Through Group, or such other
address as Moody's may hereafter furnish to the Depositor, the Securities
Administrator, the Trustee, and the Servicer.
Xxxxxx Xxxxxxx: Xxxxxx Xxxxxxx, a Delaware corporation.
Mortgage: The mortgage, deed of trust or other instrument
identified on the Mortgage Loan Schedule as securing a Mortgage Note.
Mortgage File: The items pertaining to a particular Mortgage Loan
contained in either the Servicing File or Custodial File.
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, which Mortgage Loan includes,
without limitation, the Mortgage File, the Scheduled Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
REO Disposition proceeds, Prepayment Charges, 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 Purchase Agreement: The Accredited Purchase
Agreement, the CIT Purchase Agreement, the First Horizon Purchase Agreement, the
First NLC Purchase Agreement, the FlexPoint Purchase Agreement, the Funding
America Purchase Agreement, the Lenders Direct Purchase Agreement, the Lime
Financial Purchase Agreement, the Mandalay Purchase Agreement, the Master
Financial Purchase Agreement, the Maxim Purchase Agreement, the NC Capital
Purchase Agreement, the Platinum Purchase Agreement or the Rose Purchase
Agreement, as applicable.
Mortgage Loan Schedule: A schedule of Mortgage Loans delivered to
the Custodian and referred to on Schedule I, such schedule setting forth the
following information with respect to each Mortgage Loan: (1) the Originator's
Mortgage Loan number; (2) the city, state and zip code of the Mortgaged
Property; (3) a code indicating whether the Mortgaged Property is a single
family residence, two-family residence, three-family residence, four-family
residence, PUD or condominium; (4) the current Mortgage Rate; (5) the current
net Mortgage Rate; (6) the current Scheduled Payment; (7) with respect to each
Adjustable Rate Mortgage Loan, the Gross Margin; (8) the original term to
maturity; (9) the scheduled maturity date; (10) the principal balance of the
Mortgage Loan as of the Cut-off Date after deduction of payments of principal
due on or before the Cut-off Date whether or not collected; (11) the
Loan-to-Value Ratio; (12) the next Interest Rate Adjustment Date; (13) with
respect to each Adjustable Rate Mortgage Loan, the lifetime mortgage interest
rate cap; (14) whether the Mortgage Loan is convertible or not; (15) a code
indicating the mortgage guaranty insurance company; (16) the Servicing Fee;
(17) the identity of the related Originator of such Mortgage Loan; (18) the
Mortgagor's name; (19) the "paid-through" date (based on payments received from
the related Mortgagor) as of the Cut-off Date; (20) the Servicing Transfer Date;
(21) whether such Mortgage Loan has been 30 days Delinquent since the applicable
Servicing Transfer Date; and (22) whether such Mortgage Loan provides for a
Prepayment Charge as well as the term and amount of such Prepayment Charge, if
any.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor under a Mortgage Loan.
Mortgage Rate: The annual rate of interest borne on a Mortgage
Note, which shall be adjusted from time to time in the case of an Adjustable
Rate Mortgage Loans.
Mortgage Rate Caps: With respect to an Adjustable Rate Mortgage
Loan, the Periodic Mortgage Rate Cap, the Maximum Mortgage Rate, and the Minimum
Mortgage Rate for such Mortgage Loan.
Mortgaged Property: With respect to each Mortgage Loan, the real
property (or leasehold estate, if applicable) identified on the Mortgage Loan
Schedule as securing repayment of the debt evidenced by the related Mortgage
Note.
Mortgagor: The obligor(s) on a Mortgage Note.
NC Capital: NC Capital Corporation, a California corporation, and
its successors in interest.
NC Capital Mortgage Loan: A Mortgage Loan which was acquired from
NC Capital by the Unaffiliated Seller pursuant to the NC Capital Purchase
Agreement, and which has been acquired by the Trust Fund.
NC Capital Purchase Agreement: The Third Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of April 1, 2006, as
amended to date, by and between the Unaffiliated Seller and NC Capital, a copy
of which is attached hereto as Exhibit MM.
Net Monthly Excess Cash Flow: For any Distribution Date the portion
of Available Funds remaining for distribution pursuant to
subsection 4.02(a)(iii) (before giving effect to distributions pursuant to such
subsection).
Net Prepayment Interest Shortfall: For any Distribution Date, the
amount by which the sum of the Prepayment Interest Shortfalls for such
Distribution Date exceeds the sum of (i) all Prepayment Interest Excesses for
such Distribution Date and (ii) the Compensating Interest payments made with
respect to such Distribution Date.
Net Swap Payment: With respect to any Distribution Date, any net
payment (other than a Swap Termination Payment) payable by the Supplemental
Interest Trust to the Swap Provider on the related Fixed Rate Payer Payment Date
(as defined in the Interest Rate Swap Agreement).
Net Swap Receipt: With respect to any Distribution Date, any net
payment (other than a Swap Termination Payment) payable by the Swap Provider to
the Supplemental Interest Trust on the related Floating Rate Payer Payment Date
(as defined in the Interest Rate Swap Agreement).
NIM Issuer: The entity established as the issuer of the NIM
Securities.
NIM Indenture: The Indenture, dated as of April 30, 2007, among
Natixis Real Estate Capital Inc. NIM 2007-HE2N, Ltd., as issuer, Natixis Real
Estate Capital Inc. NIM 2007-HE2N, LLC, as co-issuer, and Xxxxx Fargo Bank,
National Association, as indenture trustee.
NIM Securities: Any debt securities secured or otherwise backed by
some or all of the Class X and Class P Certificates that are rated by one or
more Rating Agencies.
NIM Trustee: The trustee for the NIM Securities.
NMWHFIT: A "Non-Mortgage Widely Held Fixed Investment Trust" as
that term is defined in Treasury Regulations section 1.671-5(b)(12) or successor
provisions.
Non-Delay Certificates: As specified in the Preliminary Statement.
Non-Permitted Transferee: A Person other than a Permitted
Transferee.
Nonrecoverable P&I Advance: Any P&I Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property that, in the
good faith business judgment of the Servicer will not or, in the case of a
proposed P&I Advance, would not be ultimately recoverable from related late
payments, Insurance Proceeds, Condemnation Proceeds or Liquidation Proceeds on
such Mortgage Loan or REO Property as provided herein.
Nonrecoverable Servicing Advance: Any Servicing Advances previously
made or proposed to be made in respect of a Mortgage Loan or REO Property,
which, in accordance with Accepted Servicing Practices, will not or, in the case
of a proposed Servicing Advance, would not be ultimately recoverable from
related Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds or
otherwise.
Notice of Final Distribution: The notice to be provided pursuant to
Section 11.02 to the effect that final distribution on any of the Certificates
shall be made only upon presentation and surrender thereof.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate signed by an officer of the
Servicer or Subservicer responsibility for the servicing of the Mortgage Loans
required to be serviced by the Servicer or Subservicer and listed on a list
delivered to the Securities Administrator pursuant to this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
in-house counsel for the Servicer or the Subservicer, reasonably acceptable to
the Trustee and the Securities Administrator; provided that any Opinion of
Counsel relating to (a) qualification of any Trust REMIC or (b) compliance with
the REMIC Provisions, must be (unless otherwise stated in such Opinion of
Counsel) an opinion of counsel who (i) is in fact independent of the Servicer,
(ii) does not have any material direct or indirect financial interest in the
Servicer or in an Affiliate thereof and (iii) is not connected with the Servicer
as an officer, employee, director or person performing similar functions.
Optional Termination Date: means:
(i) For so long as the Class X Certificates are 100% owned, either
directly or indirectly, by the Unaffiliated Seller or any Affiliate thereof,
then the Servicer may cause the Optional Termination Date to occur on any
Distribution Date when the aggregate Stated Principal Balance of the Mortgage
Loans is 5.00% or less of the Maximum Pool Principal Balance; provided, that if
the Servicer does not exercise its right to cause the Optional Termination Date
to occur, the Master Servicer may cause the Optional Termination Date to occur
on any Distribution Date when the aggregate Stated Principal Balance of the
Mortgage Loans is 5.00% or less of the Maximum Pool Principal Balance; and
(ii) If the Class X Certificates are not 100% owned, either directly
or indirectly, by the Unaffiliated Seller or any Affiliate thereof, then the
Holders of a majority in Class Certificate Balance of the Class X Certificates
may cause the Optional Termination Date to occur on any Distribution Date when
the aggregate Stated Principal Balance of the Mortgage Loans is 5.00% or less of
the Maximum Pool Principal Balance, if such Class X Certificateholders do not do
so, then the Servicer shall also have such right and, if the Servicer does not
do so then the Master Servicer shall have such right; provided, however, that
the Unaffiliated Seller or any of its Affiliates, may only participate in the
exercise of the clean-up call by the majority owners of the Class X Certificates
if the Unaffiliated Seller or any of its Affiliates, is not the majority owner
of the Class X Certificates, either directly or indirectly.
Originator: The party that originated or acquired a Mortgage Loan
and, more specifically, (i) with respect to any Accredited Mortgage Loan,
Accredited, (ii) with respect to any CIT Mortgage Loan, CIT, (iii) with respect
to any First Horizon Mortgage Loan, First Horizon, (iv) with respect to any
First NLC Mortgage Loan, First NLC, (v) with respect to any FlexPoint Mortgage
Loan, FlexPoint, (vi) with respect to any Funding America, LLC, Funding America,
(vii) with respect to any Lenders Direct Mortgage Loan, Lenders Direct,
(viii) with respect to any Lime Financial Mortgage Loan, Lime Financial,
(ix) with respect to Mandalay Mortgage, LLC, Mandalay, (x) with respect to any
Master Financial Mortgage Loan, Master Financial, (xi) with respect to any Maxim
Mortgage Loan, Maxim, (xii) with respect to any NC Capital Mortgage Loan, NC
Capital, (xiii) with respect to any Platinum Mortgage Loan, Platinum, and
(xiv) with respect to any Rose Mortgage Loan, Rose.
OTS: Office of Thrift Supervision, and any successor thereto.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Securities
Administrator or delivered to the Securities Administrator for
cancellation; and
(ii) 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 Due Date, a Mortgage Loan with
a Stated Principal Balance greater than zero which was not the subject of a
Principal Prepayment in Full prior to such Due Date and which did not become a
Liquidated Mortgage Loan prior to such Due Date.
Ownership Interest: As to any Residual 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.
P&I Advance: As to any Mortgage Loan or REO Property, any advance
made by the Servicer in respect of any Remittance Date representing the
aggregate of all payments of principal and interest, net of the Servicing Fee,
that were due during the related Due Period on the Mortgage Loans and that were
delinquent on the related Determination Date, plus certain amounts representing
assumed payments not covered by any current net income on the Mortgaged
Properties acquired by foreclosure or deed in lieu of foreclosure as determined
pursuant to Section 4.01.
Pass-Through Margin: With respect to each Class of LIBOR
Certificates, on or prior to the Optional Termination Date the following
percentages: Class A-1, 0.1300%; Class A-2, 0.2500%; Class A-3, 0.3000%;
Class A-4, 0.4000%; Class M-1, 0.5000%; Class M-2, 0.5500%; Class M-3, 0.6800%;
Class M-4, 1.4500%; Class M-5, 1.9500%; Class M-6, 2.2500%; Class B-1, 2.2500%;
Class B-2, 2.2500%; Class B-3, 2.2500%; and Class B-4, 2.2500%. On the first
Distribution Date after the Optional Termination Date, the Pass-Through Margins
shall increase to the following percentages: Class A-1, 0.2600%; Class A-2,
0.5000%; Class A-3, 0.6000%; Class A-4, 0.8000%; Class M-1, 0.7500%; Class M-2,
0.8250%; Class M-3, 1.0200%; Class M-4, 2.1750%; Class M-5, 2.9250%; Class M-6,
3.3750%; Class B-1, 3.3750%; Class B-2, 3.3750%; Class B-3, 3.3750%; and
Class B-4, 3.3750%.
Pass-Through Rate: For each Class of Regular Certificates, each
REMIC PF Regular Interest, each Pooling-Tier REMIC-1 Regular Interest, each
Pooling-Tier REMIC-2 Regular Interest, each Lower-Tier Regular Interest, each
Upper-Tier Regular Interest and each Class X REMIC Regular Interest, the
per-annum rate set forth or calculated in the manner described in the
Preliminary Statement.
PCAOB: The Public Company Accounting Oversight Board.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the Denomination of such Certificate by the
aggregate of the Denominations of all Certificates of the same Class.
Periodic Mortgage Rate Cap: With respect to an Adjustable Rate
Mortgage Loan, the periodic limit on each Mortgage Rate adjustment as set forth
in the related Mortgage Note.
Permitted Investments: Any one or more of the following obligations
or securities acquired at a purchase price of not greater than par, regardless
of whether issued by the Servicer, the Securities Administrator or any of their
respective Affiliates:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or any
agency or instrumentality thereof, provided such obligations are backed by
the full faith and credit of the United States;
(ii) demand and time deposits in, certificates of deposit of, or
bankers' acceptances (which shall each have an original maturity of not
more than 90-days and, in the case of bankers' acceptances, shall in no
event have an original maturity of more than 365 days or a remaining
maturity of more than 30-days) denominated in United States dollars and
issued by, any Depository Institution and rated "P-1" by Moody's, "F1+" by
Fitch and "A-1+" by Standard & Poor's (to the extent they are Rating
Agencies hereunder and are so rated by such Rating Agency);
(iii) repurchase obligations with respect to any security described
in clause (i) above entered into with a Depository Institution (acting as
principal);
(iv) securities bearing interest or sold at a discount that are
issued by any corporation incorporated under the laws of the United States
of America or any State thereof and that are rated by each Rating Agency
that rates such securities in its highest long-term unsecured rating
categories at the time of such investment or contractual commitment
providing for such investment;
(v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a
specified date not more than 30-days after the date of acquisition
thereof) that is rated by each Rating Agency that rates such securities in
its highest short-term unsecured debt rating available at the time of such
investment;
(vi) units of money market funds, including money market funds
advised by the Depositor, the Securities Administrator or an Affiliate
thereof, that have been rated "Aaa" by Moody's, "AAAm" by Standard &
Poor's and at least "AA" by Fitch (to the extent they are Rating Agencies
hereunder and such funds are so rated by such Rating Agency); and
(vii) if previously confirmed in writing to the Securities
Administrator, any other demand, money market or time deposit, or any
other obligation, security or investment, as may be acceptable to the
Rating Agencies as a permitted investment of funds backing "Aaa" or "AAA"
rated securities;
provided, however, that no instrument described hereunder shall evidence either
the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.
Permitted Transferee: Any Person other than (i) the United States,
any State or political subdivision thereof, 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)
which 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, (v) a Person that is not a U.S.
Person or a U.S. Person with respect to whom income from a Residual Certificate
is attributable to a foreign permanent establishment or fixed base, within the
meaning of an applicable income tax treaty of such Person or any other U.S.
Person, or a U.S. Person treated as a partnership for U.S. federal income tax
purposes, any direct or indirect beneficial owner of which (other than through a
U.S. corporation) is (or is permitted to be under the related partnership
agreement) not a U.S. Person, (vi) an "electing large partnership" within the
meaning of Section 775 of the Code and (vii) any other Person so designated by
the Depositor based upon an Opinion of Counsel that the Transfer of an Ownership
Interest in a Residual Certificate to such Person may cause any Trust REMIC to
fail to qualify as a REMIC at any time that the 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, limited liability company, joint-stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
Physical Certificates: As specified in the Preliminary Statement.
Plan: As defined in Section 5.02(b).
Platinum: Platinum Capital Group, a California corporation, and its
successors in interest.
Platinum Agreements: The Platinum Purchase Agreement and the
Platinum Assignment Agreement, copies of which are attached hereto as Exhibit
NN.
Platinum Assignment Agreement: The Assignment and Recognition
Agreement, dated as of April 30, 2007, by and among the Unaffiliated Seller, the
Depositor and Platinum, and each other Assignment and Recognition Agreement by
and among the Unaffiliated Seller, the Depositor and Platinum in connection with
any Subsequent Transfer of Platinum Mortgage Loans.
Platinum Mortgage Loan: A Mortgage Loan which was acquired from
Platinum by the Unaffiliated Seller pursuant to the Platinum Purchase Agreement,
and which has been acquired by the Trust Fund.
Platinum Purchase Agreement: The Amended and Restated Mortgage Loan
Purchase and Warranties Agreement, dated as of December 1, 2006, as amended to
date, by and between the Unaffiliated Seller and Platinum.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of the Mortgage Loans for such
Distribution Date that were Outstanding Mortgage Loans on the Due Date in the
related Due Period.
Pooling-Tier Interest Rate: As specified in the Preliminary
Statement.
Pooling-Tier REMIC-1: As described in the Preliminary Statement.
Pooling-Tier REMIC-1 Interest Rate: As described in the Preliminary
Statement.
Pooling-Tier REMIC-1 Principal Amount: As described in the
Preliminary Statement.
Pooling-Tier REMIC-1 Regular Interest: As described in the
Preliminary Statement.
Pooling-Tier REMIC-1 WAC Rate: With respect to the applicable
Pooling-Tier REMIC-1 Regular Interests as of any Distribution Date, a per annum
rate equal to the weighted average of the REMIC PF Interest Rates for the
Class PF-A and Class PF-B Interests, weighted on the basis of their respective
Pooling-Tier REMIC-1 Principal Amounts.
Pooling-Tier REMIC-2: As described in the Preliminary Statement.
Pooling-Tier REMIC-2 Interest Rate: As described in the Preliminary
Statement.
Pooling-Tier REMIC-2 IO Interest: Any of the Pooling-Tier REMIC-2
Regular Interests with the designation "IO" in its name.
Pooling-Tier REMIC-2 IO Notional Balance: As described in the
Preliminary Statement.
Pooling-Tier REMIC-2 Principal Amount: As described in the
Preliminary Statement.
Pooling-Tier REMIC-2 Regular Interest: As described in the
Preliminary Statement.
Pre-Funding Account: The separate Eligible Account created and
maintained by the Securities Administrator pursuant to Section 3.07(f) in the
name of Securities Administrator for the benefit of the Certificateholders, and
designated in trust for registered holders of Natixis Real Estate Capital Trust
2007-HE2, Mortgage Pass Through Certificates, Series 2007-HE2, the funds of
which, during the Pre-Funding Period, shall be applied solely to the purchase of
Subsequent Mortgage Loans.
Pre-Funding Amount: With respect to any date, the amount on deposit
in the Pre-Funding Account, which amount the Securities Administrator shall
evidence to the Custodian upon request.
Pre-Funding Earnings: The actual investment earnings realized on
amounts deposited in the Pre-Funding Account.
Pre-Funding Period: The period commencing on the Closing Date and
ending on the earliest to occur of (i) the date on which the amount on deposit
in the Pre-Funding Account (exclusive of any investment earnings) is less than
$100,000, (ii) the date on which any Event of Default occurs and (iii) July 25,
2007.
Pre-Funding Reserve Account: The separate Eligible Account created
and maintained by the Securities Administrator pursuant to Section 3.07(j) in
the name of the Securities Administrator, for the benefit of the Class X
Certificateholders and designated "Xxxxx Fargo Bank, National Association, in
trust for holders of Natixis Real Estate Capital Trust 2007-HE2, Mortgage
Pass-Through Certificates, Series 2007-HE2, Class X".
Prepayment Charge: Any prepayment premium, penalty or charge
collected by the Servicer with respect to a Mortgage Loan from a Mortgagor in
connection with any voluntary Principal Prepayment pursuant to the terms of the
related Mortgage Note.
Prepayment Interest Excess: With respect to any Distribution Date,
any interest collected by the Servicer with respect to any Mortgage Loan as to
which a Principal Prepayment in Full occurs from the 1st day of the month
through the 15th day of the month in which such Distribution Date occurs and
that represents interest that accrues from the 1st day of such month to the date
of such Principal Prepayment in Full.
Prepayment Interest Shortfall: With respect to any Distribution
Date, the sum of, for each Mortgage Loan that was during the portion of the
Prepayment Period from and including the 16th day of the month preceding the
month in which such Distribution Date occurs (or from the day following the
Cut-off Date, in the case of the first Distribution Date) through the last day
of such month the subject of a Principal Prepayment in Full, that was applied by
the Servicer to reduce the outstanding principal balance of such Mortgage Loan
on a date preceding the Due Date in the succeeding Prepayment Period, an amount
equal to interest at the applicable Adjusted Net Mortgage Rate on the amount of
such Principal Prepayment for the number of days commencing on the date on which
the prepayment is applied and ending on the last day of the calendar month
preceding such Distribution date.
Prepayment Period: With respect to any Distribution Date, the
period from and including the 16th day of the month preceding the month in which
such Distribution Date occurs (or, in the case of the first Distribution Date,
from and including the Cut-off Date) to and including the 15th day of the month
in which such Distribution Date occurs.
Principal Distribution Amount: For any Distribution Date, the sum
of (i) the Basic Principal Distribution Amount for such Distribution Date and
(ii) the Extra Principal Distribution Amount for such Distribution Date.
Principal Prepayment: Any full or partial payment or other recovery
of principal on a Mortgage Loan (including upon liquidation of a Mortgage Loan)
which is received in advance of its scheduled Due Date, excluding any Prepayment
Charge thereon and which is not accompanied by an amount of interest
representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Remittance Amount: With respect to any Distribution Date,
the amount equal to the sum of the following amounts (without duplication) with
respect to the related Due Period: (i) each Scheduled Payment of principal on a
Mortgage Loan during the related Due Period and received by the Servicer on or
prior to the related Determination Date or advanced by the Servicer for the
related Remittance Date and all Principal Prepayments received during the
related Prepayment Period; (ii) the principal component of all Condemnation
Proceeds, Insurance Proceeds and Liquidation Proceeds during the related
Prepayment Period (in each case, net of remaining (i.e., not deducted from the
Interest Remittance Amount) unreimbursed expenses incurred in connection with a
liquidation or foreclosure and unreimbursed Advances, if any); (iii) all
_Principal Prepayments received during the related Prepayment Period; (iv) the
principal component of all Substitution Adjustment Amounts allocable to
principal and Repurchase Prices received by the Servicer with respect to such
Distribution Date; and (v) the proceeds of any termination of the Trust Fund
pursuant to Section 11.01 (to the extent such proceeds relate to principal);
reduced by remaining amounts (i.e., not deducted from the Interest Remittance
Amount) in reimbursement for Advances previously made with respect to the
Mortgage Loans and other amounts as to which the Servicer is entitled to be
reimbursed pursuant to this Agreement.
Private Certificates: As specified in the Preliminary Statement.
Prospectus Supplement: The Prospectus Supplement, dated April 25,
2007, relating to the Offered Certificates.
PTCE 95-60: As defined in Section 5.02(b).
PUD: Planned Unit Development.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If such organization or a successor is no longer in
existence, "Rating Agency" shall be such nationally recognized statistical
rating organization, or other comparable Person, as is designated by the
Depositor, notice of which designation shall be given to the Trustee and the
Securities Administrator. References herein to a given rating or rating
category of a Rating Agency shall mean such rating category without giving
effect to any modifiers. For purposes of Section 12.05(b), the addresses for
notices to each Rating Agency shall be the address specified therefor in the
definition corresponding to the name of such Rating Agency, or such other
address as such Rating Agency may hereafter furnish to the Depositor, the
Trustee, the Securities Administrator, and the Servicer.
Realized Loss: With respect to any date of determination and any
Liquidated Mortgage Loan the excess (not less than zero or more than the Stated
Principal Balance of the Mortgage Loan) of the unpaid principal balance of a
Liquidated Mortgage Loan together with accrued and unpaid interest thereon over
the Liquidation Proceeds, net of customary out-of-pocket expenses incurred by
the Servicer in connection with the liquidation of such Liquidated Mortgage Loan
and net of the amount of any unreimbursed Servicing Advances with respect to
such Liquidated Mortgage Loan.
Record Date: With respect to any Distribution Date, the close of
business on the Business Day immediately preceding such Distribution Date;
provided, however, that for any Definitive Certificate, the Record Date shall be
the close of business on the last Business Day of the month immediately
preceding the month in which such applicable Distribution Date occurs.
Reference Bank: As defined in Section 4.04.
Regular Certificates: As specified in the Preliminary Statement.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506-1,631 (January 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 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 Servicemembers Civil Relief Act and similar state laws.
Remainder Amount: As defined in Section 11.01.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
REMIC PF: As specified in the Preliminary Statement.
REMIC PF WAC Rate: With respect to the Mortgage Loans as of any
Distribution Date, a per annum rate equal to the weighted average of the
Adjusted Net Mortgage Rates for such Mortgage Loans (excluding, in the case of
the first three Distribution Dates and the related Interest Accrual Periods
only, the Subsequent Mortgage Loans) then in effect on the beginning of the
related Due Period, adjusted in each case to accrue on the basis of a 360-day
year and the actual number of days in the related Interest Accrual Period.
REMIC PF Regular Interests: As specified in the Preliminary
Statement.
REMIC Provisions: Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.
Remittance Date: With respect to any Distribution Date, the 21st
day (or if such day is a Saturday, then the first Business Day immediately
preceding that day, or if such day is a Sunday or otherwise not a Business Day,
then the immediately following Business Day) of the month of the related
Distribution Date.
REO Disposition: The final sale by the Servicer of any REO Property.
REO Imputed Interest: As to any REO Property, for any period, an
amount equivalent to interest (at the Mortgage Rate net of the Servicing Fee
Rate that would have been applicable to the related Mortgage Loan had it been
outstanding) on the unpaid principal balance of the Mortgage Loan as of the date
of acquisition thereof (as such balance is reduced pursuant to Section 3.17 by
any income from the REO Property treated as a recovery of principal).
REO Property: A Mortgaged Property acquired by the Trust Fund
through foreclosure or deed-in-lieu of foreclosure in connection with a
defaulted Mortgage Loan.
Replacement Swap Provider Payment: Any payments that have been
received by the Supplemental Interest Trust as a result of entering into a
replacement interest rate swap agreement.
Reportable Event: As defined in Section 8.12(g).
Representative: Xxxxxx Xxxxxxx & Co. Incorporated, as
representative on behalf of itself and Natixis Securities LLC.
Repurchase Price: With respect to any Mortgage Loan, an amount
equal to the sum (without duplication) of (i) the unpaid principal balance of
such Mortgage Loan as of the date of repurchase and (ii) (x) if such Mortgage
Loan is being repurchased by the Unaffiliated Seller, the sum of (A) interest on
such unpaid principal balance of such Mortgage Loan at the Mortgage Rate from
the last date through which interest has been paid and distributed to the
Securities Adminisrator to the last day of the month in which such repurchase
occurs, (B) all xxxxxxxxxxxx X&X Advances and Servicing Advances, (C) all unpaid
Servicing Fees, (D) all expenses reasonably incurred by the Servicer, the
Trustee, the Custodian, the Securities Administrator, the Master Servicer or the
Unaffiliated Seller, as the case may be, in respect of a breach or defect,
including, without limitation, expenses arising out of any such party's
enforcement of the Originator's repurchase obligation, to the extent not
included in (B), and (E) all costs and expenses incurred by, or on behalf of,
the Trust Fund in connection with any violation by such Mortgage Loan of a
predatory or abusive-lending law or (y) if such Mortgage Loan is being
repurchased by the related Originator, the repurchase price specified in the
related Mortgage Loan Purchase Agreement.
Request for Release: The Request for Release submitted by the
Servicer to the Trustee and Custodian, substantially in the form of Exhibit K.
Residual Certificates: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, the
Master Servicer or the Securities Administrator, as applicable, any director,
any vice president, any assistant vice president, any assistant secretary, any
assistant treasurer or any other officer of the Trustee, the Master Servicer or
the Securities Administrator, as applicable, customarily performing functions
similar to those performed by any of the above designated officers who at such
time shall be officers 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 and who, in each case, shall have direct responsibility for
the administration of this Agreement.
Reuters Page LIBOR01: The display page currently so designated on
the Reuters Xtra 3000 Service (or such other page as may replace that page on
that service or any successor service for displaying comparable rates or
prices).
Rose: Rose Mortgage, Inc., a New Jersey corporation, and its
successors in interest.
Rose Mortgage Loan: A Mortgage Loan which was acquired from Rose by
the Unaffiliated Seller pursuant to the Rose Purchase Agreement, and which has
been acquired by the Trust Fund.
Rose Purchase Agreement: The Third Amended and Restated Mortgage
Loan Purchase and Warranties Agreement, dated as of August 1, 2006, as amended
to date, by and between the Unaffiliated Seller and Rose, a copy of which is
attached hereto as Exhibit OO.
Rule 144A Letter: As defined in Section 5.02(b).
Sarbanes Certification: As defined in Section 8.12(c).
Saxon: Saxon Mortgage Services, Inc., a Texas corporation, and it
successors in interest.
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
which, unless otherwise specified herein, shall give effect to any related Debt
Service Reduction and any Deficient Valuation that affects the amount of the
monthly payment due on such Mortgage Loan.
Second Lien Mortgage Loan: A Mortgage Loan secured by a second lien
Mortgage on the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securities Administrator: Xxxxx Fargo Bank, National Association, a
banking association organized under the laws of the United States, and its
successors and assigns, in its capacity as Securities Administrator hereunder.
Securities Administrator and Master Servicer Fee: With respect to
any Distribution Date, an amount equal to the product of (a) one-twelfth of the
Securities Administrator and Master Servicer Fee Rate and (b) the sum of (i) the
Stated Principal Balance of the Mortgage Loans as of the prior Distribution Date
(or as of the Cut-off Date in the case of the first Distribution Date) and
(ii) the Pre-Funding Amount.
Securities Administrator and Master Servicer Fee Rate: With respect
to each Mortgage Loan, 0.0050% per annum.
Senior Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balance of the Subordinated Certificates and (ii) the Subordinated
Amount (in each case after taking into account the distribution of the Principal
Distribution Amount and any principal payments on those Classes of Certificates
from the Swap Account for such Distribution Date) by (y) the Current Maximum
Amount for that Distribution Date.
Senior Specified Enhancement Percentage: As of any date of
determination, 44.20%.
Servicer: Saxon Mortgage Services, Inc., a Texas corporation, its
successors and assigns, in its capacity as the Servicer hereunder.
Servicer Remittance Report: As defined in Section 4.03(c).
Servicing Advances: The reasonable "out-of-pocket" costs and
expenses (including legal fees) incurred by the Servicer in the performance of
its servicing obligations in connection with a default, delinquency or other
unanticipated event, including, but not limited to, the cost of (i) the
preservation, restoration, inspection and protection of a Mortgaged Property,
(ii) any enforcement, administrative or judicial proceedings, including
foreclosures and litigation, in respect of a particular Mortgage Loan, (iii) the
management (including reasonable fees in connection therewith) and liquidation
of any REO Property (including reasonable fees paid to any independent
contractor in connection therewith) and (iv) the performance of its obligations
under Section 3.01, Section 3.09, Section 3.13 and Section 3.15. Servicing
Advances also include any reasonable "out-of-pocket" costs and expenses
(including legal fees) incurred by the Servicer in connection with executing and
recording instruments of satisfaction, deeds of reconveyance or Assignments of
Mortgage in connection with any foreclosure in respect of any Mortgage Loan to
the extent not recovered from the Mortgagor or otherwise payable under this
Agreement. The Servicer shall not be required to make any Nonrecoverable
Servicing Advances.
Servicing Criteria: The "servicing criteria" set forth in
Item 1122(d) of Regulation AB, which as of the Closing Date are listed on
Exhibit Q hereto.
Servicing Fee: With respect to the Servicer and each Mortgage Loan
and for any calendar month, an amount equal to one month's interest (or in the
event of any payment of interest which accompanies a Principal Prepayment in
Full made by the Mortgagor during such calendar month, interest for the number
of days covered by such payment of interest) at the Servicing Fee Rate on the
applicable Stated Principal Balance of such Mortgage Loan as of the first day of
the related Due Period (or the Cut-off Date, in the case of the First
Distribution Date). Such fee shall be payable monthly, and shall be pro rated
for any portion of a month during which the Mortgage Loan is serviced by the
Servicer under this Agreement. The Servicing Fee is payable solely from, the
interest portion (including recoveries with respect to interest from Liquidation
Proceeds, Insurance Proceeds, Condemnation Proceeds and proceeds received with
respect to REO Properties, to the extent permitted by Section 3.11) of such
Scheduled Payment collected by the Servicer, or as otherwise provided under
Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, 0.50% per
annum.
Servicing File: With respect to each Mortgage Loan, the file
retained by the Servicer consisting of originals or copies of all documents in
the Mortgage File which are not delivered to the Custodian in the Custodial File
and copies of each of the other Mortgage Loan documents required to be delivered
by the related Originator pursuant to the terms of the related Mortgage Loan
Purchase Agreement.
Servicing Function Participant: As defined in Section 3.23(a).
Servicing Officer: Any officer of the Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and facsimile signature appear on a list of servicing officers furnished to
the Trustee, the Securities Administrator, the Master Servicer and the Custodian
by the Servicer on the Closing Date pursuant to this Agreement, as such list may
from time to time be amended.
Servicing Transfer Date: With respect to each Mortgage Loan, the
date on which Saxon commenced servicing such Mortgage Loan, as set forth on the
Mortgage Loan Schedule.
Servicing Trigger Event: With respect to each Determination Date, a
Servicing Trigger Event exists if total Cumulative Loss Percentage exceeds:
(i) 8.50% on any Determination Date up to, and including, the fifth anniversary
of the Cut-off Date; or (ii) 10.82% on any Determination Date from the fifth to,
and including, the tenth anniversary of the Cut-off Date. Following the tenth
anniversary of the Cut-off Date, no Servicing Trigger Event shall exist.
Significant Change to a Permitted Activity: With respect to any
amendment or other instrument entered into pursuant to Section 12.01, a change
to the activities of the Trust that would significantly change its permitted
activities and thus cause the Trust to cease to be a "qualifying special purpose
entity" under accounting principles generally accepted in the United States.
This definition shall be interpreted in a manner consistent with the
requirements of Statement of Financial Accounting Standards No. 140, Accounting
for Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities, or any successor to that accounting standard, and any other
relevant authoritative accounting literature, as such requirements are
applicable from time to time.
Similar Law: As defined in Section 5.02(b).
60+ Day Delinquent Mortgage Loan: (i) Each Mortgage Loan with
respect to which any portion of a Scheduled Payment is, as of the last day of
the prior Due Period, two months or more delinquent and (ii) each REO Property.
Specified Subordinated Amount: With respect to any Distribution
Date prior to the Stepdown Date, an amount equal to 3.10% of the Maximum Pool
Principal Balance; and with respect to any Distribution Date on and after the
Stepdown Date, an amount equal to 6.20% of the Current Maximum Amount for that
Distribution Date subject to a minimum amount equal to 0.50% of the Maximum Pool
Principal Balance; provided, however, that if, on any Distribution Date, a
Trigger Event exists, the Specified Subordinated Amount shall not be reduced to
the applicable percentage of the Current Maximum Amount, but instead shall
remain the same as the prior period's Specified Subordinated Amount until the
Distribution Date on which a Trigger Event no longer exists. When the Class
Certificate Balance of each Class of LIBOR Certificates has been reduced to
zero, the Specified Subordinated Amount shall thereafter equal zero.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc., and its successors in interest. If Standard &
Poor's is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 10.06 the address for notices to Standard & Poor's shall be
Standard & Poor's, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Residential Mortgage Surveillance Group - Natixis Real Estate Capital Trust
2007-HE2, or such other address as Standard & Poor's may hereafter furnish to
the Depositor, the Trustee, the Securities Administrator and the Servicer.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R)
Glossary, as may be in effect from time to time.
Startup Day: For each Trust REMIC, the Closing Date.
Stated Principal Balance: As to each Mortgage Loan and as of any
date of determination, (i) the principal balance of the 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 remitted to the
Securities Administrator with respect to the related Mortgage Loan representing
payments or recoveries of principal, including Advances in respect of Scheduled
Payments of principal. For purposes of any Distribution Date, the Stated
Principal Balance of any Mortgage Loan will give effect to any Scheduled
Payments of principal received by the Servicer on or prior to the related
Determination Date or advanced by the Servicer prior to the related Remittance
Date and any unscheduled principal payments and other unscheduled principal
collections received during the related Prepayment Period, and the Stated
Principal Balance of any Mortgage Loan that has prepaid in full or has become a
Liquidated Mortgage Loan during the related Prepayment Period shall be zero.
Stepdown Date: The later to occur of (i) the earlier to occur of
(a) the Distribution Date in May 2010 and (b) the Distribution Date on which the
aggregate Class Certificate Balance of the Class A Certificates have been
reduced to zero and (ii) the first Distribution Date on which the Senior
Enhancement Percentage (calculated for this purpose only after taking into
account scheduled and unscheduled payments of principal on the Mortgage Loans on
the last day of the related Due Period but prior to any allocation of the
Principal Distribution Amount together with any principal payments from the Swap
Account to the LIBOR Certificates on the applicable Distribution Date) is
greater than or equal to the Senior Specified Enhancement Percentage.
Subcontractor: Any third-party or Affiliated vendor, subcontractor
or other Person utilized by the Servicer, a Subservicer, or the Master Servicer
or the Securities Administrator, as applicable, 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.
Subordinated Amount: With respect to any Distribution Date, the
excess, if any, of (a) the Current Maximum Amount for that Distribution Date on
such Distribution Date over (b) the aggregate of the Class Certificate Balances
of the LIBOR Certificates as of such Distribution Date (after giving effect to
the payment of the Principal Remittance Amount on such Certificates on such
Distribution Date).
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordination Deficiency: With respect to any Distribution Date,
the excess, if any, of (a) the Specified Subordinated Amount applicable to such
Distribution Date over (b) the Subordinated Amount applicable to such
Distribution Date.
Subordination Reduction Amount: With respect to any Distribution
Date, an amount equal to the lesser of (a) the Excess Subordinated Amount and
(b) the Net Monthly Excess Cash Flow.
Subsequent Recovery: With respect to any Mortgage Loan or related
Mortgaged Property that became a Liquidated Mortgage Loan or was otherwise
disposed of, all amounts received in respect of such Liquidated Mortgage Loan
after an Applied Realized Loss Amount related to such Mortgage Loan or Mortgaged
Property is allocated to reduce the Class Certificate Balance of any Class of
Subordinated Certificates. Any Subsequent Recovery that is received during a
Prepayment Period will be treated as Liquidation Proceeds and included as part
of the Principal Remittance Amount for the related Distribution Date.
Subsequent Cut-off Date: As to any Subsequent Mortgage Loans, the
date specified in the Addition Notice delivered in connection therewith, which
date shall be the close of business on the first day of the month in which such
Subsequent Mortgage Loans will be conveyed to the Trust Fund.
Subsequent Mortgage Loans: The Mortgage Loans hereafter transferred
and assigned to the Trust Fund pursuant to Section 2.01(c), each of which shall
have been purchased by the Unaffiliated Seller under a Mortgage Loan Purchase
Agreement.
Subsequent Transfer: The transfer and assignment by the Depositor
to the Trust of the Subsequent Mortgage Loans pursuant to the terms hereof.
Subsequent Transfer Agreement: Any one or more of the subsequent
transfer agreements substantially in the form of Exhibit M hereto pursuant to
which a Subsequent Mortgage Loan is transferred and assigned to the Trust Fund
on a Subsequent Transfer Date.
Subsequent Transfer Date: The Business Day on which a Subsequent
Transfer occurs.
Subservicer: Any Person that services Mortgage Loans on behalf of
the Servicer or any Subservicer and is responsible for the performance (whether
directly or through Subservicers or Subcontractors) of a substantial portion of
the material servicing functions required to be performed by the Servicer under
this Agreement, with respect to some or all of the Mortgage Loans, that are
identified in Item 1122(d) of Regulation AB.
Subservicing Account: As defined in Section 3.08.
Subservicing Agreement: As defined in Section 3.02(a).
Substitute Mortgage Loan: A Mortgage Loan substituted by the
Unaffiliated Seller or an Originator for a Deleted Mortgage Loan in accordance
with the terms of this Agreement or the related Mortgage Loan Purchase
Agreement, as applicable, which must, on the date of such substitution, as
confirmed in a Request for Release, substantially in the form of Exhibit K,
(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 more than 10% less than, the Stated Principal Balance of the Deleted
Mortgage Loan; (ii) be accruing interest at a rate no lower than and not more
than 1% per annum higher than, that of the Deleted Mortgage Loan; (iii) have a
Loan-to-Value Ratio no higher than that of the Deleted Mortgage Loan; (iv) have
a remaining term to maturity no greater than (and not more than one year less
than that of) the Deleted Mortgage Loan; and (v) comply with each representation
and warranty set forth in Sections 3.01(f), 3.01(h), 3.01(n), 3.01(o), 3.01(p)
and 3.03 of the Unaffiliated Seller's Agreement, each representation and
warranty set forth in the applicable Mortgage Loan Purchase Agreement and each
of the requirements set forth in Sections 2.01(c) hereof.
Substitution Adjustment Amount: The meaning ascribed to such term
pursuant to Section 2.03(d).
Supplemental Interest Trust: Natixis Real Estate Capital
Supplemental Interest Trust 2007-HE2 established pursuant to Section 2.01(d).
Swap Account: As defined in Section 4.08.
Swap Assets: Collectively, the Swap Account, the Interest Rate Swap
Agreement, the Class IO Interest and the right to receive Class IO Shortfalls,
subject to the obligation to pay amounts specified in Section 4.08.
Swap LIBOR: With respect to any Distribution Date (and the related
Interest Accrual Period), the product of (i) USD-LIBOR-BBA (as defined in the
Annex to the 2000 ISDA Definitions as published by the International Swaps and
Derivatives Association, Inc.), (ii) two, and (iii) the quotient of (a) the
actual number of days in the Interest Accrual Period for the LIBOR Certificates
divided by (b) 30.
Swap Payment Allocation: For any Class of Certificates and any
Distribution Date, that Class's pro rata share of the Net Swap Receipts, if any,
for that Distribution Date, based on the Class Certificate Balances of the
Classes of Certificates.
Swap Payment Rate: For any Distribution Date, a fraction, the
numerator of which is any Net Swap Payment or Swap Termination Payment (other
than a Defaulted Swap Termination Payment) owed to the Swap Provider for such
Distribution Date and the denominator of which is the Stated Principal Balance
of the mortgage loans at the beginning of the related Due Period plus amounts in
the Pre-Funding Account, multiplied by 12.
Swap Provider: Natixis Financial Products Inc., a Delaware
corporation, and any successor thereto.
Swap Termination Payment: Any payment payable by the Supplemental
Interest Trust or the Swap Provider upon termination of the Interest Rate Swap
Agreement as a result an Event of Default (as defined in the Interest Rate Swap
Agreement) or a Termination Event (as defined in the Interest Rate Swap
Agreement); provided that a Swap Termination Payment shall not be paid from
Available Funds to the extent already paid by a replacement swap provider as a
Replacement Swap Provider Payment.
Tax Matters Person: The Holder of the (i) Class R and (ii) Class RX
Certificates designated as "tax matters person" of (i) REMIC PF, Pooling-Tier
REMIC-1, Pooling-Tier REMIC-2, the Lower-Tier REMIC and the Upper-Tier REMIC,
and (ii) the Class X REMIC respectively, in the manner provided under Treasury
Regulations Section 1.860F-4(d) and Treasury Regulations Section
301.6231(a)(7)-1.
Tax Service Contract: As defined in Section 3.09(a).
Termination Price: As defined in Section 11.01.
Total Monthly Excess Spread: As to any Distribution Date, an amount
equal to the excess if any, of (i) the interest on the Mortgage Loans received
by the Servicer on or prior to the related Determination Date (other than
Prepayment Interest Excesses) or advanced by the Servicer for the related
Remittance Date (net of Expense Fees) over (ii) the sum of the amounts payable
to the LIBOR Certificates pursuant to Section 4.02(a)(i) and Net Swap Payments
and Swap Termination Payment (other than a Defaulted Swap Termination Payment)
to the Swap Provider on such Distribution Date.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Transfer Affidavit: As defined in Section 5.02(c).
Transferor Certificate: As defined in Section 5.02(b).
Trigger Event: The occurrence of either a Delinquency Trigger Event
or a Cumulative Loss Trigger Event.
Trust: The express trust created hereunder in Section 2.01(d).
Trust Fund: The corpus of the trust created hereunder consisting of
(i) the Mortgage Loans and all interest and principal received on or with
respect thereto after the related Cut-off Date (after giving effect to payments
of principal due on or prior to the Cut off Date, whether or not received),
other than such amounts which were due on the Mortgage Loans on or before the
related Cut-off Date; (ii) each Account and all amounts deposited therein
pursuant to the applicable provisions of this Agreement; (iii) property that
secured a Mortgage Loan and has been acquired by foreclosure, deed-in-lieu of
foreclosure or otherwise; (iv) all rights of the Depositor against the
Unaffiliated Seller under the Unaffiliated Seller's Agreement; (v) all rights of
the Depositor against each Originator under the related Assignment and
Recognition Agreement, if any, and the related Mortgage Loan Purchase Agreement;
(vi) the Swap Assets, (vii) the Interest Rate Cap Agreement; and (viii) all
proceeds of the conversion, voluntary or involuntary, of any of the foregoing.
Trust REMIC: Any of REMIC PF, Pooling-Tier REMIC-1, Pooling-Tier
REMIC-2, the Lower-Tier REMIC, the Upper-Tier REMIC, or the Class X REMIC, as
applicable.
Trustee: Deutsche Bank National Trust Company, a national banking
association, and its successors in interest and, if a successor trustee is
appointed hereunder, such successor.
Unaffiliated Seller's Agreement: The Unaffiliated Seller's
Agreement, dated as of the date hereof, among the Unaffiliated Seller and the
Depositor relating to the sale of the Mortgage Loans from the Unaffiliated
Seller to the Depositor.
Underwriter: Xxxxxx Xxxxxxx & Co. Incorporated.
Underwriters' Exemption: Any exemption listed under footnote 1 of,
and amended by, Prohibited Transaction Exemption 2002-41, 67 Fed. Reg. 54487
(2002), or any successor exemption.
Unpaid Interest Amount: As of any Distribution Date and any Class
of Certificates, the sum of (a) the excess of (i) the sum of the Accrued
Certificate Interest for such Distribution Date and any portion of such Accrued
Certificate Interest from prior Distribution Dates remaining unpaid over
(ii) the amount in respect of interest on such Class of Certificates actually
distributed on that Distribution Date and (b) interest on the amount in
clause (a) above at the applicable Pass-Through Rate (to the extent permitted by
applicable law).
Unpaid Realized Loss Amount: With respect to any Class of
Subordinated Certificates and as to any Distribution Date, is the excess of
(i) the Applied Realized Loss Amount with respect to such Class over (ii) the
sum of (without duplication) (a) all distributions in reduction of such Applied
Realized Loss Amounts on all previous Distribution Dates and (b) the amount by
which the Class Certificate Balance of such Class has been increased due to the
distribution of any Subsequent Recoveries on all previous Distribution Dates.
Any amounts distributed to a Class of Subordinated Certificates in respect of
any Unpaid Realized Loss Amount will not be applied to reduce the Class
Certificate Balance of such Class.
Upper-Tier CarryForward Amount: With respect to each Class of LIBOR
Certificates, as of any Distribution Date, the sum of (A) if on such
Distribution Date the Upper-Tier Interest Rate for the Class of Corresponding
Upper-Tier REMIC Regular Interest is based upon the Upper-Tier REMIC WAC Rate,
the excess, if any, of (i) the amount of interest such Class of Upper-Tier
Regular Interest would otherwise be entitled to receive on such Distribution
Date had such Upper-Tier REMIC Regular Interest not been subject to the
Upper-Tier REMIC WAC Rate, over (ii) the amount of interest payable on such
Class of Upper-Tier Regular Interest on such Distribution Date taking into
account the Upper-Tier REMIC WAC Rate and (B) the Upper-Tier CarryForward Amount
for such Class of Certificates for all previous Distribution Dates not
previously paid, together with interest thereon at a rate equal to the
applicable Upper-Tier Interest Rate for such Class of Certificates for such
Distribution Date, without giving effect to the Upper-Tier REMIC WAC Rate.
Upper-Tier Interest Rate: As described in the Preliminary Statement.
Upper-Tier Regular Interest: As described in the Preliminary
Statement.
Upper-Tier REMIC: As described in the Preliminary Statement.
Upper-Tier REMIC WAC Rate: For any Distribution Date, the weighted
average of the Lower-Tier Interest Rates on the Lower-Tier Regular Interests
(other than the Class LT-IO and Class LT-PFIO Interests) as of the first day of
the related Interest Accrual Period, weighted on the basis of the Lower-Tier
Principal Amounts of such Lower-Tier Regular Interests as of the first day of
the related Interest Accrual Period.
U.S. Person: (i) A citizen or resident of the United States; (ii) a
corporation (or entity treated as a corporation for tax purposes) created or
organized in the United States or under the laws of the United States or of any
State thereof, including, for this purpose, the District of Columbia; (iii) a
partnership (or entity treated as a partnership for tax purposes) organized in
the United States or under the laws of the United States or of any State
thereof, including, for this purpose, the District of Columbia (unless provided
otherwise by future Treasury regulations); (iv) an estate whose income is
includible in gross income for United States income tax purposes regardless of
its source; or (v) 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 U.S. Persons have authority to control substantial decisions of the trust.
Notwithstanding the last clause of the preceding sentence, to the extent
provided in Treasury regulations, certain trusts in existence on August 20,
1996, and treated as U.S. Persons prior to such date, may elect to continue to
be U.S. Persons.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) 1% of all Voting Rights shall be allocated to the Class X
Certificates, if any (such Voting Rights to be allocated among the Holders of
Certificates of each such Class in accordance with their respective Percentage
Interests), (b) 1% of all Voting Rights shall be allocated to the Class P
Certificates, if any, and (c) the remaining Voting Rights shall be allocated
among Holders of the remaining Classes of Certificates in proportion to the
Certificate Balances of their respective Certificates on such date.
WAC Cap: With respect to the Mortgage Loans as of any Distribution
Date, the product of (i) the weighted average of the Adjusted Net Mortgage Rates
then in effect on the beginning of the related Due Period on the Mortgage Loans,
less the Swap Payment Rate, and (ii) a fraction, the numerator of which is 30
and the denominator of which is the actual number of days in the Interest
Accrual Period related to such Distribution Date.
WHFIT: A "Widely Held Fixed Investment Trust" as that term is
defined in Treasury Regulations section 1.671-5(b)(22) or successor provisions.
WHFIT Regulations: Treasury Regulations section 1.671-5, as amended.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and delivery hereof, hereby sells, transfers,
assigns, sets over and otherwise conveys to the Trustee for the benefit of the
Certificateholders, without recourse, all the right, title and interest of the
Depositor in and to the Trust Fund and the Trustee, on behalf of the Trust,
hereby accepts the Trust Fund, other than any Subsequent Mortgage Loans, which
will be so sold, transferred, assigned, set-over and conveyed on the related
Subsequent Transfer Date. The Mortgage Loans permitted by the terms of this
Agreement to be included in the Trust Fund are limited to (i) the Initial
Mortgage Loans, (ii) Subsequent Mortgage Loans (which the Depositor is required
hereunder to have acquired pursuant to Subsequent Transfer Agreements) and (iii)
Substitute Mortgage Loans. It is agreed and understood by the parties hereto
that it is not intended that any Mortgage Loan be included in the Trust Fund
that is a High Cost Loan. On the Closing Date, the Depositor shall pay, without
any right of reimbursement from the Trust, to the Cap Provider the "Fixed
Amount" (as defined in the Interest Rate Cap Agreement) due and payable to the
Cap Provider pursuant to the terms of the Interest Rate Cap Agreement.
(b) In connection with the transfer and assignment of each Mortgage
Loan, the Unaffiliated Seller has delivered or caused to be delivered to the
Custodian for the benefit of the Certificateholders the following documents or
instruments with respect to each Mortgage Loan so assigned (to the extent such
documents or instruments are required to be delivered by the related Originator
under each Mortgage Loan Purchase Agreement):
(i) the original Mortgage Note bearing all intervening endorsements
evidencing a complete chain of assignment from the originator to the
related Originator, endorsed "Pay to the order of _________, without
recourse" and signed in the name of the related Originator by an
authorized officer. To the extent that there is no room on the face of the
Mortgage Notes for endorsements, the endorsement may be contained on an
allonge, unless the Trustee and the Custodian are advised by the related
Originator that state law does not so allow. If the Mortgage Loan was
acquired by an Originator in a merger, the endorsement must be by
"[related Originator], successor by merger to [name of predecessor]". If
the Mortgage Loan was acquired or originated by the related Originator
while doing business under another name, the endorsement must be by
"[related Originator], formerly known as [previous name]";
(ii) the original of any guarantee executed in connection with the
Mortgage Note;
(iii) the original Mortgage with evidence of recording thereon. If
in connection with any Mortgage Loan, the original Mortgage with evidence
of recording thereon cannot be delivered on or prior to the related
Delivery Date because of a delay caused by the public recording office
where such Mortgage has been delivered for recordation or because such
Mortgage has been lost or because such public recording office retains the
original recorded Mortgage, then the related Originator, as required by
the terms of the related Mortgage Loan Purchase Agreement, will be
required to deliver to the Custodian, on behalf of the Trustee, a
photocopy of such Mortgage and (i) the original recorded Mortgage or a
copy of such Mortgage certified by such public recording office to be a
true and complete copy of the original recorded Mortgage promptly upon
receipt thereof by the related Originator (but in any event within 360
days from the related Delivery Date); or (ii) in the case of a Mortgage
where a public recording office retains the original recorded Mortgage or
in the case where a Mortgage is lost after recordation in a public
recording office, a copy of such Mortgage certified by such public
recording office to be a true and complete copy of the original recorded
Mortgage;
(iv) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;
(v) the original Assignment of Mortgage for each Mortgage Loan
endorsed in blank, in form and substance acceptable for recording (except
with respect to MERS Designated Mortgage Loans);
(vi) the originals of all intervening assignments of mortgage,
evidencing a complete chain of assignment from the originator (or MERS
with respect to each MERS Designated Mortgage Loan) to the related
Originator, with evidence of recording thereon or if any such intervening
assignment has not been returned from the applicable recording office or
has been lost or if such public recording office retains the original
recorded assignments of mortgage;
(vii) the original or duplicate lender's title policy and all riders
thereto or, if such original is unavailable, either an original title
binder or an original or copy of the title commitment, and if copies then
certified to be true and complete by the title company; and
(viii) the security agreement, chattel mortgage or equivalent
document executed in connection with the Mortgage, if any.
If any Mortgage has been recorded in the name of MERS, no Assignment
of Mortgage in favor of the Trustee will be required to be prepared or delivered
and instead, the Servicer shall take all reasonable actions as are necessary at
the expense of the applicable Originator to the extent permitted under the
related Purchase Agreement and otherwise at the expense of the Depositor to
cause the Trustee to be shown as Investor of the related Mortgage Loan on the
records of MERS for the purpose of the system of recording transfers of
beneficial ownership of mortgages maintained by MERS. Within 90 days after the
Closing Date, the Trustee shall, for the benefit of the Holders of the
Certificates, based solely on the list of MERS Designated Mortgage Loans and
screen printouts from the MERS system provided to the Trustee by the
Unaffiliated Seller (such to be provided to the Trustee no later than 45 days
from the Closing Date), the Trustee shall confirm, on behalf of the Trust, that
the Trustee is shown as the Investor with respect to each MERS Designated
Mortgage Loan on such screen printouts. If the Trustee is not shown as the
Investor with respect to any MERS Designated Mortgage Loans on such screen
printouts, the Trustee shall promptly notify the Unaffiliated Seller of such
fact and the Unaffiliated Seller shall then either cure such defect or
repurchase such Mortgage Loan in accordance with Section 2.03.
From time to time, the Servicer shall forward to the Custodian
additional original documents, additional documents evidencing an assumption,
modification, consolidation or extension of a Mortgage Loan approved by the
Servicer, in accordance with the terms of this Agreement. All such mortgage
documents held by the Custodian as to each Mortgage Loan shall constitute the
"Custodial File".
On or prior to the related Delivery Date, the Unaffiliated Seller
shall deliver, or cause the related Originator to deliver, to the Custodian
Assignments of Mortgage, in blank, for each Mortgage Loan. If an Assignment of
Mortgage is required to be recorded pursuant to the terms hereof, the Servicer,
or the Servicer's designee shall direct the Custodian to promptly forward such
Assignment of Mortgage to the Servicer for recording. No later than thirty (30)
Business Days following the date of receipt by the Servicer of all necessary
recording information for a Mortgage, the Servicer shall promptly submit or
cause to be submitted for recording, at the expense of the Unaffiliated Seller
(the Unaffiliated Seller to seek reimbursement from the related Originator under
the applicable Mortgage Loan Purchase Agreement) in the appropriate public
office for real property records, each Assignment of Mortgage referred to in
Section 2.01(b)(v). Notwithstanding the foregoing, however, for administrative
convenience and facilitation of servicing and to reduce closing costs, the
Assignment of Mortgage shall not be required to be completed and submitted for
recording with respect to any MERS Designated Mortgage Loan or any Mortgage Loan
(other than any Mortgage Loan where the Mortgaged Property is located in any
state where recordation is required by any Rating Agency to obtain the initial
ratings on the Certificates, which states as of the date hereof, are Florida and
Maryland) upon a determination by the Servicer that recordation is necessary for
the enforcement of rights under, or satisfaction or assignment of, the related
Mortgage, at which time, the Servicer shall record any such Assignment of
Mortgage in accordance with the terms hereof. If any Assignment of Mortgage is
required to be recorded pursuant to the terms hereof, the Mortgage shall be
assigned from the related Originator, to "Deutsche Bank National Trust Company,
as trustee under the Pooling and Servicing Agreement dated as of April 1, 2007,
Natixis Real Estate Capital Trust 2007-HE2." In the event that any such
assignment is lost or returned unrecorded because of a defect therein, the
Unaffiliated Seller shall cause the related Originator to promptly prepare a
substitute assignment to cure such defect and thereafter cause each such
assignment to be duly recorded. In the event the Unaffiliated Seller does not
pay or otherwise reimburse the Servicer for any of the foregoing costs of
recording any such Assignment of Mortgage, the Servicer shall be entitled to be
reimbursed from the Trust Fund from amounts on deposit in its Collection
Account. In the event the related Originator fails to reimburse the Unaffiliated
Seller for the recording costs described above, upon receipt of written
direction from the Unaffiliated Seller, the Trustee shall assign its rights
under the applicable Mortgage Loan Purchase Agreement solely with respect to
payment of such expenses to the Unaffiliated Seller.
The Unaffiliated Seller shall use commercially reasonable efforts to
assist the Servicer in causing the related Originator to deliver (at the expense
of such Originator pursuant to the related Mortgage Loan Purchase Agreement) to
the Servicer copies of all trailing documents required to be included in the
Custodial File at the same time the originals or certified copies thereof are
delivered to the Custodian, such documents, including, but not limited to, the
mortgagee policy of title insurance and any mortgage loan documents upon return
from the recording office. The Unaffiliated Seller shall use commercially
reasonable efforts to assist the Servicer in seeking reimbursement from the
related Originator pursuant to the related Mortgage Loan Purchase Agreement for
any fees or costs incurred by the Servicer in obtaining such documents.
On or prior to the Closing Date, the Unaffiliated Seller shall
deliver to the Trustee, the Custodian, the Securities Administrator, the Master
Servicer and the Servicer a copy of the Data Tape Information in electronic,
machine readable medium in a form mutually acceptable to the Custodian, the
Trustee, the Securities Administrator, the Master Servicer and the Servicer.
Within ten days of the Closing Date, the Unaffiliated Seller shall deliver a
copy of the complete Mortgage Loan Schedule to the Custodian, the Trustee, the
Securities Administrator, the Master Servicer and the Servicer.
In the event that such original or copy of any document submitted
for recordation to the appropriate public recording office is not so delivered
to the Custodian within 90 days following the Delivery Date, as evidenced by the
Custodian's Final Certification, and in the event that the Originator does not
cure such failure within 30 days of discovery or receipt of written notification
of such failure from the Depositor, the Trustee, the Securities Administrator,
the Master Servicer or the Custodian, then the Trustee shall notify the related
Originator to repurchase the Mortgage Loan pursuant to the related Mortgage Loan
Purchase Agreement, upon the request of the Depositor, the Trustee or the
Securities Administrator, at the Repurchase Price and in the manner specified in
Section 2.03. The foregoing repurchase provision shall not apply in the event
that the related Originator cannot deliver such original or copy of any document
submitted for recordation to the appropriate public recording office within the
specified period due to a delay caused by the recording office in the applicable
jurisdiction; provided that the related Originator shall instead be required to
deliver a recording receipt of such recording office or, if such recording
receipt is not available, an officer's certificate of a servicing officer of the
Originator confirming that such document has been accepted for recording.
(c) Purchase and Sale of Subsequent Mortgage Loans.
(i) Subject to the satisfaction of the conditions set forth in
paragraph (ii) below, and upon the Securities Administrator's receipt of a
Subsequent Transfer Agreement executed by all other parties thereto, in
consideration of the Securities Administrator's delivery on the related
Subsequent Transfer Dates to or upon the order of the Depositor of all or
a portion of the balance of funds in the Pre-Funding Account, the
Depositor shall on any Subsequent Transfer Date sell, transfer, assign,
set over and convey to the Trustee without recourse but subject to terms
and provisions of this Agreement, all of the right, title and interest of
the Depositor in and to the Subsequent Mortgage Loans, including the
outstanding principal of and interest due on such Subsequent Mortgage
Loans, and all other related assets included or to be included in the
Trust Fund with respect thereto.
The amount released from the Pre-Funding Account with respect to a
transfer of Subsequent Mortgage Loans shall be one-hundred percent (100%)
of the aggregate Stated Principal Balances as of the related Subsequent
Cut-off Date of the Subsequent Mortgage Loans so transferred.
(ii) The Subsequent Mortgage Loans and the other property and rights
related thereto described in paragraph (a) above shall be transferred by
the Depositor to the Trust Fund only upon the satisfaction of each of the
following conditions on or prior to the related Subsequent Transfer Date:
(a) the Unaffiliated Seller shall have provided the Depositor, the
Trustee, the Securities Administrator and the Rating Agencies
with a timely Addition Notice, which shall include a Mortgage
Loan Schedule, listing the Subsequent Mortgage Loans and shall
have provided any other information reasonably requested by
any of the foregoing with respect to the Subsequent Mortgage
Loans;
(b) the Servicer shall have deposited in the Collection Account
all collections of (x) principal in respect of the Subsequent
Mortgage Loans received and due after the related Subsequent
Cut-off Date and (y) interest due on the Subsequent Mortgage
Loans after the related Subsequent Cut-off Date;
(c) as of each Subsequent Transfer Date, the Unaffiliated Seller
was not insolvent nor will be made insolvent by such transfer
nor is the Unaffiliated Seller aware of any pending
insolvency;
(d) the Pre-Funding Period shall not have terminated;
(e) the Unaffiliated Seller shall have delivered to the Securities
Administrator an executed Assignment and Recognition Agreement
with respect to each related Originator of Subsequent Mortgage
Loans to be added to the Trust Fund on such Subsequent
Transfer Date (which Assignment and Recognition Agreement
shall include a representation and warranty from the related
Originator that none of the Subsequent Mortgage Loans is a
High Cost Loan, none of the Subsequent Mortgage Loans is
covered by the Home Ownership and Equity Protection Act of
1994 and none of the Subsequent Mortgage Loans is in violation
of any comparable state law);
(f) each of the Rating Agencies shall have notified the
Unaffiliated Seller of its consent to the transfer of the
Subsequent Mortgage Loans to the Trust Fund which will be
evidenced to the Trustee in writing;
(g) the parties to this Agreement shall have delivered to the
Securities Administrator an executed copy of a Subsequent
Transfer Agreement, substantially in the form of Exhibit M
hereto;
(h) the Unaffiliated Seller shall have delivered to the Securities
Administrator an Officer's Certificate confirming the
satisfaction of each condition precedent specified in this
paragraph (ii), and the Opinion of Counsel referenced in
clause (d).
(i) The Trustee shall have no obligation to monitor or otherwise
determine the compliance of any other party with the foregoing
conditions, and shall have no liability for any such
non-compliance.
(iii) The obligation of the Trust Fund to purchase the Subsequent
Mortgage Loans on a Subsequent Transfer Date is subject to the
requirements that, following the purchase of such Subsequent Mortgage
Loans, with respect to the entire mortgage loan pool:
(A) no more than 5.00% may be second lien mortgage loans;
(B) no more than 39.00% may be first lien mortgage loans which are
secured by Mortgaged Properties which also secure second lien
mortgage loans;
(C) no less than 12.00% and no more than 17.00% may be Fixed Rate
Mortgage Loans;
(D) the weighted average original term to maturity may not exceed
360 months;
(E) the weighted average gross Mortgage Rate must not be less than
8.200%, or more than 8.600%;
(F) the weighted average original LTV must not exceed 81.70%, and
no more than 33.00% of the Mortgage Loans may have LTVs in
excess of 80.00%;
(G) at least 75.00% of the Mortgage Loans must have Prepayment
Charges;
(H) the weighted average Gross Margin for the Adjustable Rate
Mortgage Loans must be at least 5.900%;
(I) the weighted average credit score (FICO Score) must be at
least 618, and none of the Mortgage Loans may have credit
scores below 500;
(J) the weighted average credit score for the second-lien mortgage
loans must be at least 645;
(K) no more than 25.00% may have an interest-only period;
(L) the weighted average initial periodic rate cap for the
Adjustable Rate Mortgage Loans may not exceed 3.200%;
(M) no mortgage loan is classified as a "high cost" loan under the
Home Ownership and Equity Protection Act of 1994 ("HOEPA") and
no mortgage loan is in violation of, or classified as a "high
cost," "threshold," "predatory" or similar loan under, any
other applicable state, federal or local law.
Any of the requirements set forth in clauses (ii) and (iii) above
may be waived or modified in any respect with the consent of the Rating
Agencies.
(iv) In connection with the transfer and assignment of the
Subsequent Mortgage Loans, the Unaffiliated Seller shall satisfy the
document delivery requirements set forth in Section 2.01(b).
(d) The Depositor does hereby establish, pursuant to the further
provisions of the Agreement and the laws of the State of New York, an express
trust (the "Trust") to be known, for convenience, as "Natixis Real Estate
Capital Trust 2007-HE2" and Deutsche Bank National Trust Company is hereby
appointed as Trustee in accordance with the provisions of this Agreement. The
parties hereto acknowledge and agree that it is the policy and intention of the
Trust to acquire only Mortgage Loans meeting the requirements set forth in this
Agreement. The Trust's fiscal year is the calendar year. In addition, the
Depositor does hereby establish, pursuant to the further provisions of the
Agreement and the laws of the State of New York, an express trust (the
"Supplemental Interest Trust") to be known, for convenience, as "Natixis Real
Estate Capital Supplemental Interest Trust 2007-HE2", which, as a subtrust of
the Trust Fund, will hold the Interest Rate Swap Agreement, the Swap Account and
the Excess Reserve Fund Account.
(e) The Trust shall have the capacity, power and authority, and the
Trustee on behalf of the Trust is hereby authorized, to accept the sale,
transfer, assignment, set over and conveyance by the Depositor to the Trust of
all the right, title and interest of the Depositor in and to the Trust Fund
(including, without limitation, the Mortgage Loans) pursuant to Section 2.01(a).
The Securities Administrator is hereby authorized and directed to enter into the
Interest Rate Swap Agreement and Interest Rate Cap Agreement on behalf of the
Supplemental Interest Trust.
Section 2.02 Acceptance by the Custodian of the Mortgage Loans. The
Custodian shall acknowledge, on each Delivery Date, receipt of the documents
identified in the Initial Certification in the form annexed hereto as Exhibit F,
and declares that it holds and will hold such documents and the other documents
delivered to it pursuant to Section 2.01, and that it holds or will hold such
other assets as are included in the Trust Fund, on behalf of the Trustee, in
trust for the exclusive use and benefit of all present and future
Certificateholders. The Custodian acknowledges that it will maintain possession
of the related Mortgage Notes in the State of California, unless otherwise
permitted under this Agreement or by the Rating Agencies.
In connection with each Delivery Date, the Custodian shall deliver
or cause to be delivered via facsimile or original to the Depositor, the
Trustee, the Securities Administrator, the Unaffiliated Seller and the Servicer
an Initial Certification on or prior to the related Delivery Date, certifying
receipt of the related Mortgage Notes and Assignments of Mortgage for each
related Mortgage Loan. The Custodian shall not be responsible for verifying the
validity, sufficiency or genuineness of any document in any Custodial File.
Within 120 days after the related Delivery Date, the Custodian shall
ascertain that all documents required to be reviewed by it are in its
possession, and shall deliver to the Depositor, the Unaffiliated Seller, the
Servicer, the Trustee and the Securities Administrator a Final Certification to
the effect that, as to each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any Mortgage Loan paid in full or any Mortgage Loan specifically
identified in such certification as an exception and not covered by such
certification): (i) all documents required to be reviewed by it are in its
possession; (ii) such documents have been reviewed by it and appear regular on
their face and relate to such Mortgage Loan; (iii) based on its examination and
only as to the foregoing documents, the information set forth in items (1), (2)
and (18) of the Mortgage Loan Schedule and items (1), (9) and (17) of the Data
Tape Information respecting such Mortgage Loan is correct; (iv) each Mortgage
Note has been endorsed as provided in Section 2.01 of this Agreement; and (v)
upon receipt of the screen printouts specified in Section 2.01, with respect to
each MERS Designated Loan, the Trustee, on behalf of the Trust Fund, is listed
as the Investor of such MERS Designated Loan on the MERS System. The Custodian
shall not be responsible to verify the validity, sufficiency or genuineness of
any document in any Custodial File. Upon receipt of such Final Certification, if
the Depositor or the Unaffiliated Seller determines that any noncompliance
identified by the Custodian is a breach of a representation or warranty relating
to such Mortgage Loan, such party shall give written notice to the Trustee and
the Securities Administrator thereof.
The Custodian shall retain possession and custody of each Custodial
File in accordance with and subject to the terms and conditions set forth
herein. The Servicer shall promptly deliver to the Custodian, upon the execution
or receipt thereof, the originals of such other documents or instruments
constituting the Custodial File as come into the possession of the Servicer from
time to time.
Section 2.03 Representations, Warranties and Covenants of the
Unaffiliated Seller and the Servicer.
(a) [Reserved]
(b) Saxon hereby makes the representations and warranties set forth
in (i) Schedule III hereto to the Depositor, the Unaffiliated Seller, the
Custodian, the Securities Administrator and the Trustee and (ii) Schedule IIIA
hereto to the Unaffiliated Seller, in each case, as of the Closing Date, and
with respect to Subsequent Mortgage Loans, as of the related Subsequent Transfer
Date; provided, however, that in the case of clause (ii), Saxon only makes
representations and warranties with respect to those Mortgage Loans on Schedule
IB hereto for which the Servicing Transfer Date has occurred prior to the
Closing Date or the related Subsequent Transfer Date, as applicable.
(c) Natixis Real Estate Capital Inc., in its capacity as the
Unaffiliated Seller, hereby makes the representations and warranties set forth
in Schedule IV hereto to the Depositor, the Trustee, the Securities
Administrator and the Custodian as of the Closing Date.
(d) It is understood and agreed by the Servicer and the Unaffiliated
Seller that the representations and warranties set forth in Section 2.03 shall
survive the transfer of the Mortgage Loans to the Trust Fund, and shall inure to
the benefit of the Trust Fund notwithstanding any restrictive or qualified
endorsement on any Mortgage Note or Assignment of Mortgage or the examination or
failure to examine any Mortgage File. Upon discovery by any of the Depositor,
the Unaffiliated Seller, the Trustee, the Securities Administrator or the
Servicer of a breach by the Unaffiliated Seller of any of the foregoing
representations or any of the representations and warranties made pursuant to
Sections 3.01(f), 3.01(h), 3.01(n), 3.01(o), 3.01(p) or 3.03 of the Unaffiliated
Seller's Agreement or by any Originator of the representations and warranties
made pursuant to the related Assignment and Recognition Agreement, the party
discovering such breach shall give prompt written notice to the others.
Within 90 days of the earlier of either discovery by or notice to
the Unaffiliated Seller of any breach of a representation or warranty set forth
in Section 3.01(f), 3.01(h), 3.01(n), 3.01(o), 3.01(p) or 3.03 of the
Unaffiliated Seller's Agreement that materially and adversely affects the value
of the Mortgage Loans or the interest of the Trustee or the Certificateholders
therein, the Unaffiliated Seller shall use its best efforts to cure such breach
in all material respects and, if such breach cannot be remedied, the
Unaffiliated Seller shall, (i) if such 90-day period expires prior to the second
anniversary of the related Delivery Date, remove such Mortgage Loan from the
Trust Fund and substitute in its place a Substitute Mortgage Loan, in the manner
and subject to the conditions set forth in this Section 2.03; or (ii) repurchase
such Mortgage Loan at the Repurchase Price; provided, however, that any such
substitution pursuant to (i) above shall not be effected prior to the delivery
to the Trustee of the Opinion of Counsel or Officer's Certificate, as
applicable, as required by Section 2.05 and a Request for Release substantially
in the form of Exhibit K, and the Mortgage File for any such Substitute Mortgage
Loan. The Trustee shall forward such Request for Release to the Custodian and
the Custodian shall release the related Mortgage File.
In the event there is a breach of a representation or warranty by an
Originator with respect to a Mortgage Loan originated or acquired by such
Originator that materially and adversely affects the value of such Mortgage Loan
or the interest of the Trustee and the Certificateholders therein, and, upon
discovery or receipt of notice, such Originator fails to cure, substitute or
repurchase such Mortgage Loan within the period specified in either the
applicable Assignment and Recognition Agreement, if any, or the applicable
Mortgage Loan Purchase Agreement, the Unaffiliated Seller shall cure, substitute
or repurchase such Mortgage Loan subject to the conditions set forth in this
Section 2.03. Notwithstanding the foregoing, the Unaffiliated Seller shall not
be obligated to cure, substitute or repurchase any Mortgage Loan as a result of
such a breach of a representation or warranty to the effect that the first
Scheduled Payment due after the Cut-off Date with respect to such Mortgage Loan
has been made on its Due Date or within the applicable grace period, all in
accordance with the terms of the related Mortgage Note, unless such first
Scheduled Payment is the first Scheduled Payment due immediately following the
origination of such Mortgage Loan. Notwithstanding the Unaffiliated Seller's
lack of knowledge, in the event it is discovered by the Unaffiliated Seller, the
Depositor or the Trust (including the Trustee and the Servicer acting on the
Trust's behalf), that the substance of a representation or warranty was
inaccurate as of the applicable date of such representation or warranty and such
inaccuracy materially and adversely affects the value of the related Mortgage
Loan, the Unaffiliated Seller shall use its best efforts to cure such breach or
substitute or repurchase such Mortgage Loan in accordance with this Section
2.03(d).
With respect to any Substitute Mortgage Loan or Loans, the
Unaffiliated Seller shall deliver to the Custodian, on behalf of the Trustee,
for the benefit of the Certificateholders the Mortgage Note, the Mortgage, the
related Assignment of the Mortgage, and such other documents and agreements as
are required by Section 2.01, with the Mortgage Note endorsed and the Mortgage
assigned as required by Section 2.01. No substitution is permitted to be made in
any calendar month after the Determination Date for such month. Scheduled
Payments due with respect to Substitute Mortgage Loans in the Due Period of
substitution shall not be part of the Trust Fund and will be retained by the
related Originator on the next succeeding Distribution Date. For the Due Period
of substitution, distributions to Certificateholders will include the Scheduled
Payment due on any Deleted Mortgage Loan for such Due Period and thereafter the
related Originator shall be entitled to retain all amounts received in respect
of such Deleted Mortgage Loan.
For any month in which the Unaffiliated Seller substitutes one or
more Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the
Servicer will determine the amount (if any) by which the aggregate principal
balance of all such Substitute Mortgage Loans as of the date of substitution is
less than the aggregate unpaid principal balance of all such Deleted Mortgage
Loans. The Unaffiliated Seller shall deposit the amount of such shortage plus an
amount equal to the aggregate of any unreimbursed Advances and accrued and
unpaid Servicing Fee with respect to such Deleted Mortgage Loans (the
"Substitution Adjustment Amount") into the Collection Account on or before the
Remittance Date for the Distribution Date in the month succeeding the calendar
month during which the related Mortgage Loan became required to be purchased or
replaced hereunder.
Upon receipt of written notice (x) from the Custodian that any
document does not comply with the requirements set forth in clauses (i) through
(iv) of the Custodian's review of the Custodial Files pursuant to Section 2.02
or (y) of a breach of a representation and warranty, the Trustee shall in turn
promptly notify the applicable Originator (with a copy to the Servicer, the
Custodian and the Unaffiliated Seller) in writing of such non-compliance or
breach and request that the related Originator cure such non-compliance or
breach within the time period set forth in the applicable Mortgage Loan Purchase
Agreement (but in any event, within 60 days from the date the related Originator
is notified of such non-compliance or breach) and if the related Originator does
not cure such non-compliance or breach in all material respects during such
period, the Securities Administrator shall notify such Originator to repurchase
such Mortgage Loan from the Trust Fund at the Repurchase Price. In the event the
Trustee receives written notice (x) of a breach by any Originator of a
representation and warranty that is subject to an automatic sixty (60) day
repurchase obligation pursuant to Section 9.03 of the related Mortgage Loan
Purchase Agreement, which representations and warranties relate to Prepayment
Fees, Predatory Lending Regulations, Single Premium Credit Insurance, the
Georgia Fair Lending Act, the Fair Credit Reporting Act, New York State Banking
Law or (y) that a Mortgage Loan does not constitute a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code, the Trustee shall notify
such Originator to repurchase the Mortgage Loan at the Repurchase Price within
sixty (60) days of such Originator's receipt of such notice.
(e) Upon receipt of the Final Certification with respect to each
Mortgage Loan, the Trustee will notify the related Originator within 5 Business
Days of such delivery of any missing documents from the Custodial File and if
the related Originator does not deliver such missing documents within 60 days
from the date the related Originator is notified of such noncompliance or
breach, the Trustee shall notify such Originator to repurchase such Mortgage
Loan from the Trust Fund at the Repurchase Price.
(f) Based solely on information received with respect to any
Substitute Mortgage Loan from the Unaffiliated Seller or the related Originator,
as applicable, the Servicer shall amend the Mortgage Loan Schedule to reflect
the removal of such Deleted Mortgage Loan and the substitution of the Substitute
Mortgage Loan or Loans and the Servicer shall deliver the amended Mortgage Loan
Schedule to the Securities Administrator. Upon such substitution, the Substitute
Mortgage Loan or Loans shall be subject to the terms of this Agreement in all
respects, and the Unaffiliated Seller shall be deemed to have made with respect
to such Substitute Mortgage Loan or Loans, as of the date of substitution, the
representations and warranties made pursuant to Sections 3.01(f), 3.01(h),
3.01(n), 3.01(o), 3.01(p) and 3.03 of the Unaffiliated Seller's Agreement with
respect to such Mortgage Loan. Upon any such substitution and the deposit to the
Collection Account of the amount required to be deposited therein in connection
with such substitution as described in this Section 2.03, the Securities
Administrator shall forward the Request for Release from the Servicer to the
Custodian and the Custodian shall release the Mortgage File relating to such
Deleted Mortgage Loan to the Unaffiliated Seller or the related Originator, as
applicable, and shall execute and deliver at the Unaffiliated Seller's or
related Originator's direction, as applicable, such instruments of transfer or
assignment prepared by such party, in each case without recourse, as shall be
necessary to vest title in the Unaffiliated Seller or the related Originator, or
its designee, as applicable, the Trustee's interest in any Deleted Mortgage Loan
substituted for pursuant to this Section 2.03.
(g) In the event that the Unaffiliated Seller or the related
Originator, as applicable, shall have repurchased a Mortgage Loan, the
Repurchase Price therefor shall be deposited in the Collection Account pursuant
to Section 3.10 on or before the Remittance Date for the Distribution Date in
the month following the month during which the Unaffiliated Seller or the
related Originator, as applicable, became obligated hereunder to repurchase or
replace such Mortgage Loan and upon such deposit of the Repurchase Price, the
delivery of the Opinion of Counsel or Officer's Certificate, as applicable,
required by Section 2.05 and receipt of a Request for Release in the form of
Exhibit K hereto, the Trustee shall forward the Request for Release from the
Servicer to the Custodian, and the Custodian shall release the related Custodial
File to such Person as directed by the Servicer, and the Trustee shall execute
and deliver at such Person's direction such instruments of transfer or
assignment prepared by such Person, in each case without recourse, as shall be
necessary to transfer title from the Trustee. It is understood and agreed that
the obligation under this Agreement of any Person to cure, repurchase or replace
any Mortgage Loan as to which a breach has occurred and is continuing shall
constitute the sole remedy against such Persons respecting such breach available
to Certificateholders, the Depositor, the Unaffiliated Seller, the Custodian,
the Securities Administrator or the Trustee on their behalf. In the event such
required repurchase or replacement does not occur, the Securities Administrator
shall take such actions as directed upon written direction from the Depositor
and the provision of reasonable indemnity satisfactory to the Securities
Administrator in accordance with Sections 6.03 and 10.02.
(h) If the Unaffiliated Seller is required to repurchase or replace
a Mortgage Loan pursuant to the terms hereof, upon receipt by the Trustee of
written direction from the Unaffiliated Seller and either written certification
from the Unaffiliated Seller that it has deposited the related Repurchase Price
with the Securities Administrator or receipt by the Trustee of a Substitute
Mortgage Loan, as applicable, the Trustee shall assign to the Unaffiliated
Seller its rights under the related Mortgage Loan Purchase Agreement solely with
respect to such Mortgage Loan by an assignment in form and substance mutually
satisfactory to the Unaffiliated Seller, the Trustee and the Securities
Administrator.
(i) The representations and warranties made pursuant to this Section
2.03 shall survive delivery of the respective Custodial Files to the Custodian.
Section 2.04 The Depositor and the Mortgage Loans. The Depositor
hereby represents and warrants to the Trustee and the Securities Administrator
with respect to each Mortgage Loan as of the date hereof or such other date set
forth herein that as of the related Delivery Date, and following the transfer of
the Mortgage Loans to it by the Unaffiliated Seller, the Depositor had good
title to the Mortgage Loans and the Mortgage Notes were subject to no offsets,
defenses or counterclaims.
The Depositor hereby assigns, transfers and conveys to the Trustee
all of its rights with respect to the Initial Mortgage Loans and shall, on each
Subsequent Transfer Date, convey all of its right, title and interest with
respect to the related subsequent Mortgage Loans.
Section 2.05 Delivery of Opinion of Counsel or Officer's Certificate
in Connection with Substitutions and Non-Qualified Mortgages. Notwithstanding
any contrary provision of this Agreement, no substitution pursuant to Section
2.03 shall be made more than 30 days after the related Delivery Date unless the
Unaffiliated Seller delivers, or causes the related Originator to deliver, as
applicable, to the Securities Administrator and the Trustee (i) with respect to
any substitution occurring in the first 23 months following the Startup Day, an
Officer's Certificate stating that the Deleted Mortgage Loan was in violation of
a representation or warranty that was made with respect to such loan as of the
Closing Date or related Subsequent Transfer Date, as applicable (ii) with
respect to any substitution occurring in the 24th month following the Startup
Day and thereafter, an Opinion of Counsel, at the expense of the Unaffiliated
Seller or the related Originator, as applicable, addressed to the Trustee and
the Securities Administrator, to the effect that such substitution will not (i)
result in the imposition of the tax on "prohibited transactions" on the Trust
Fund or contributions after the Startup Day, as defined in Sections 860F(a)(2)
and 860G(d) of the Code, respectively, or (ii) cause any REMIC created hereunder
to fail to qualify as one or more REMICs at any time that any Certificates are
outstanding.
Section 2.06 Execution and Delivery of Certificates. The Trustee
acknowledges the transfer and assignment to it of the Trust Fund and,
concurrently with such transfer and assignment, the Securities Administrator has
executed and delivered to or upon the order of the Depositor, the Certificates
in authorized denominations evidencing directly or indirectly 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.
Section 2.07 REMIC Matters. The Preliminary Statement sets forth the
designations for federal income tax purposes of all interests created hereby.
The "Startup Day" of each Trust REMIC for purposes of the REMIC Provisions shall
be the Closing Date. The "latest possible maturity date" of the regular
interests in each Trust REMIC is the Distribution Date occurring in July 2037,
which is the Distribution Date in the month following the month in which the
latest maturity date of any Mortgage Loan occurs. Amounts distributable to the
Class X Certificates (prior to any reduction for any Basis Risk Payment,
Upper-Tier CarryForward Amount, Net Swap Payment or Swap Termination Payment),
exclusive of any amounts received from the Swap Provider or the Cap Provider or
from the Pre-Funding Reserve Account, shall be deemed paid from the Upper-Tier
REMIC to the Class X REMIC in respect of the Class UT-X Interest, the Class
UT-IO Interest and the Class UT-PFIO Interest, as applicable, and then from the
Class X REMIC in respect of the Class X Interest, Class IO Interest and the
Class PF-IO Interest, as applicable, to the Holders of the Class X Certificates
prior to distribution of any Basis Risk Payments or Upper-Tier CarryForward
Amounts to the LIBOR Certificates and Net Swap Payments or Swap Termination
Payments to the Swap Provider. For federal income tax purposes, any amount
distributed on the LIBOR Certificates on any Distribution Date in excess of the
amount distributable on their Corresponding Class of Upper-Tier Regular Interest
on such Distribution Date shall be treated as having been paid from the Excess
Reserve Fund Account or the Swap Account, as applicable, and any amount
distributable on such Corresponding Class of Upper-Tier Regular Interest on such
Distribution Date in excess of the amount distributable on the Corresponding
Class of LIBOR Certificates on such Distribution Date shall be treated as having
been paid to the Swap Account, all pursuant to and as further provided in
Section 8.13.
Section 2.08 Representations and Warranties of the Depositor. The
Depositor hereby represents, warrants and covenants to the Trustee, the
Custodian, the Securities Administrator, the Master Servicer, the Unaffiliated
Seller and the Servicer that as of the date of this Agreement or as of such date
specifically provided herein:
(a) The Depositor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware;
(b) The Depositor has the corporate power and authority to convey
the Mortgage Loans and to execute, deliver and perform, and to enter into and
consummate the transactions contemplated by, this Agreement;
(c) This Agreement has been duly and validly authorized, executed
and delivered by the Depositor, all requisite corporate action having been
taken, and, assuming the due authorization, execution and delivery hereof by the
other parties hereto, constitutes or will constitute the legal, valid and
binding agreement of the Depositor, enforceable against the Depositor in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights of creditors generally, and by general
equity principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law);
(d) No consent, approval, authorization or order of or registration
or filing with, or notice to, any governmental authority or court is required
for the execution, delivery and performance of or compliance by the Depositor
with this Agreement or the consummation by the Depositor of any of the
transactions contemplated hereby, except as have been made on or prior to the
Closing Date;
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby or thereby, or the
fulfillment of or compliance with the terms and conditions of this Agreement,
(i) conflicts or will conflict with or results or will result in a breach of, or
constitutes or will constitute a default or results or will result in an
acceleration under (A) the charter or by-laws of the Depositor, or (B) of any
term, condition or provision of any material indenture, deed of trust, contract
or other agreement or instrument to which the Depositor or any of its
subsidiaries is a party or by which it or any of its subsidiaries is bound; (ii)
results or will result in a violation of any law, rule, regulation, order,
judgment or decree applicable to the Depositor of any court or governmental
authority having jurisdiction over the Depositor or its subsidiaries; or (iii)
results in the creation or imposition of any lien, charge or encumbrance which
would have a material adverse effect upon the Mortgage Loans or any documents or
instruments evidencing or securing the Mortgage Loans;
(f) There are no actions, suits or proceedings before or against or
investigations of, the Depositor pending, or to the knowledge of the Depositor,
threatened, before any court, administrative agency or other tribunal, and no
notice of any such action, which, in the Depositor's reasonable judgment, might
materially and adversely affect the performance by the Depositor of its
obligations under this Agreement, or the validity or enforceability of this
Agreement;
(g) The Depositor is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,
municipal or governmental agency that may materially and adversely affect its
performance hereunder; and
(h) Immediately prior to the transfer and assignment by the
Depositor to the Trustee, the Depositor had, or, with respect to the Subsequent
Mortgage Loans, will have, good title to, and was, or will be, the sole owner of
each Mortgage Loan, free of any interest of any other Person, and the Depositor
has transferred, or shall transfer, all right, title and interest in each
Mortgage Loan to the Trustee. The transfer of the Mortgage Note and the Mortgage
to the Custodian, on behalf of the Trustee, as and in the manner contemplated by
this Agreement is sufficient either (i) fully to transfer to the Trustee, for
the benefit of the Certificateholders, all right, title, and interest of the
Depositor thereto as note holder and mortgagee or (ii) to grant to the Trustee,
for the benefit of the Certificateholders and the security interest referred to
in Section 10.04.
(i) The Depositor has caused any payment to the Swap Provider or the
Cap Provider due and payable on or prior to the Closing Date to have been fully
paid on or prior to the Closing Date.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.08 shall survive delivery of the
respective Custodial Files to the Custodian and shall inure to the benefit of
the Trustee.
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans. (a) For and on
behalf of the Certificateholders, the Servicer shall service and administer the
Mortgage Loans for which it is acting as Servicer in accordance with the terms
of this Agreement and the respective Mortgage Loans and, to the extent
consistent with such terms, in the same manner in which it services and
administers similar mortgage loans for its own portfolio, giving due
consideration to customary and usual standards of practice of prudent mortgage
lenders and loan servicers administering similar mortgage loans but without
regard to:
(i) any relationship that the Servicer, any Subservicer or any
Affiliate of the Servicer or any Subservicer may have with the related
Mortgagor;
(ii) the ownership or non-ownership of any Certificate by the
Servicer or any Affiliate of the Servicer;
(iii) the Servicer's obligation to make P&I Advances or Servicing
Advances; or
(iv) the Servicer's or any Subservicer's right to receive
compensation for its services hereunder or with respect to any particular
transaction.
To the extent consistent with the foregoing, the Servicer shall seek
to maximize the timely and complete recovery of principal and interest on the
Mortgage Notes. Subject only to the above-described servicing standards and the
terms of this Agreement and of the respective Mortgage Loans, the Servicer shall
have full power and authority, acting alone or through Subservicers as provided
in Section 3.02, to do or cause to be done any and all things in connection with
such servicing and administration which it may deem necessary or desirable.
Without limiting the generality of the foregoing, the Servicer, in its own name
or in the name of a Subservicer, is hereby authorized and empowered by the
Trustee when the Servicer believes it appropriate in its best judgment in
accordance with Accepted Servicing Practices, to execute and deliver 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 Mortgage
Loans and the Mortgaged Properties and to institute foreclosure proceedings or
obtain a deed-in-lieu of foreclosure so as to convert the ownership of such
properties, and to hold or cause to be held title to such properties, on behalf
of the Trustee. The Servicer shall service and administer the Mortgage Loans in
accordance with applicable state and federal law and shall provide to the
Mortgagors any reports required to be provided to them thereby. The Servicer
covenants that its computer and other systems used in servicing the Mortgage
Loans operate in a manner such that the Servicer can service the Mortgage Loans
in accordance with the terms of this Agreement. The Servicer shall also comply
in the performance of this Agreement with all reasonable rules and requirements
of each insurer under any standard hazard insurance policy. Subject to Section
3.15, the Trustee shall execute, at the written request of the Servicer, and
furnish, or cause to be furnished, to the Servicer and any Subservicer such
documents as are necessary or appropriate to enable the Servicer or any
Subservicer to carry out their servicing and administrative duties hereunder,
and the Trustee hereby grants to the Servicer, and this Agreement shall
constitute, a power of attorney in the form of Exhibit P to carry out such
duties including a power of attorney to take title to Mortgaged Properties after
foreclosure in the name of and on behalf of the Trustee. The Trustee shall
execute a separate power of attorney in favor of the Servicer for the purposes
described herein to the extent necessary or desirable to enable the Servicer to
perform its duties hereunder. The Trustee shall not be liable for the actions of
the Servicer or any Subservicers under such powers of attorney. Notwithstanding
anything contained in this Agreement to the contrary, neither the Servicer nor
any Subservicer shall without the Trustee's consent: (i) initiate any action,
suit or proceeding solely under the Trustee's name without indicating the
Servicer's or such Subservicer's, as applicable, representative capacity, or
(ii) take any action with the intent to, or which actually does cause, the
Trustee to be registered to do business in any state.
(b) Subject to Section 3.09(b), in accordance with the standards of
the preceding paragraph, the Servicer shall advance or cause to be advanced
funds as necessary for the purpose of effecting the timely payment of taxes and
assessments on the Mortgaged Properties, which advances shall be Servicing
Advances reimbursable in the first instance from related collections from the
Mortgagors pursuant to Section 3.09(b), and further as provided in Section 3.11.
Any cost incurred by the Servicer or by Subservicers in effecting the timely
payment of taxes and assessments on a Mortgaged Property shall not be added to
the unpaid principal balance of the related Mortgage Loan, notwithstanding that
the terms of such Mortgage Loan so permit.
(c) Notwithstanding anything in this Agreement to the contrary, the
Servicer may not make any future advances with respect to a Mortgage Loan
(except as provided in Section 4.01 and except for Servicing Advances) and the
Servicer shall not (i) permit any modification with respect to any Mortgage Loan
that would change the Mortgage Rate, reduce or increase the principal balance
(except for reductions resulting from actual payments of principal) or change
the final maturity date on such Mortgage Loan (except for a reduction of
interest payments resulting from the application of the Servicemembers Civil
Relief Act or any similar state statutes) or (ii) permit any modification,
waiver or amendment of any term of any Mortgage Loan that would both (A) effect
an exchange or reissuance of such Mortgage Loan under Section 1001 of the Code
(or final, temporary or proposed Treasury regulations promulgated thereunder)
and (B) cause any Trust REMIC to fail to qualify as a REMIC under the Code or
the imposition of any tax on "prohibited transactions" or "contributions after
the startup date" under the REMIC Provisions, (iii) except as provided in
Section 3.07(a), waive any Prepayment Charges, or (iv) accept payment from the
related Mortgagor of an amount less than the unpaid principal balance of such
Mortgage Loan in final satisfaction thereof; provided, however, that the
Servicer may take any action set forth in clauses (i) through (iv) with respect
to any Mortgage Loan in default or, which in the judgment of the Servicer, a
default is reasonably foreseeable, and only to the extent the Servicer
determines that such action is not materially adverse to the interests of the
Certificateholders (taking into account any estimated Realized Loss that might
result absent such action).
(d) The Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release the Servicer
from the responsibilities or liabilities arising under this Agreement.
(e) In the event that the Mortgage Loan Documents relating to any
Mortgage Loan contain provisions requiring the related Mortgagor to submit to
binding arbitration with respect to any disputes arising in connection with such
Mortgage Loan, the Servicer shall be entitled to waive any such provisions on
behalf of the Trust and to send written notice of such waiver to the related
Mortgagor, although the Mortgagor may still require arbitration of such disputes
at its option.
Section 3.02 Subservicing Agreements Between the Servicer and
Subservicers. (a) The Servicer may enter into subservicing agreements with
Subservicers for the servicing and administration of the Mortgage Loans
("Subservicing Agreements"). The Servicer represents and warrants to the other
parties hereto that, except as otherwise set forth herein, no Subservicing
Agreement is in effect as of the Closing Date. The Servicer shall give notice to
the Depositor, the Securities Administrator, the Master Servicer and the Trustee
of any such Subservicer and Subservicing Agreement, which notice shall contain
all information (including without limitation a copy of the Subservicing
Agreement) reasonably necessary to enable the Securities Administrator, pursuant
to Section 8.12(g), to accurately and timely report the event under Item 6.02 of
Form 8-K pursuant to the Exchange Act (if such reports under the Exchange Act
are required to be filed under the Exchange Act). No Subservicing Agreement
shall be effective until 30 days after such written notice is received by both
the Depositor, the Securities Administrator, the Master Servicer and the
Trustee. The Securities Administrator, Master Servicer, the Back-up Servicer and
the Trustee shall not be required to review or consent to such Subservicing
Agreements and shall have no liability in connection therewith.
Each Subservicer shall be (i) authorized to transact business in the
state or states in which 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, (ii) an institution approved as a mortgage loan originator by the
Federal Housing Administration or an institution that has deposit accounts
insured by the FDIC and (iii) a Xxxxxxx Mac or Xxxxxx Mae approved mortgage
servicer. Each Subservicing Agreement must impose on the Subservicer
requirements conforming to the provisions set forth in Section 3.08 and provide
for servicing of the Mortgage Loans consistent with the terms of this Agreement.
The Servicer will examine each Subservicing Agreement to which it is a party and
will be familiar with the terms thereof. The terms of any Subservicing Agreement
will not be inconsistent with any of the provisions of this Agreement. The
Servicer and the Subservicers may enter into and make amendments to the
Subservicing Agreements or enter into different forms of Subservicing
Agreements; provided, however, that any such amendments or different forms shall
be consistent with and not violate the provisions of this Agreement, and that no
such amendment or different form shall be made or entered into which could be
reasonably expected to be materially adverse to the interests of the Trustee.
Any variation from the provisions set forth in Section 3.08 relating to
insurance or priority requirements of Subservicing Accounts, or credits and
charges to the Subservicing Accounts or the timing and amount of remittances by
the Subservicers to the Servicer, are conclusively deemed to be inconsistent
with this Agreement and therefore prohibited. The Servicer shall deliver to the
Securities Administrator, the Trustee, the Master Servicer, the Unaffiliated
Seller and the Depositor copies of all Subservicing Agreements, and any
amendments or modifications thereof, promptly upon the Servicer's execution and
delivery of such instruments.
(b) As part of its servicing activities hereunder, the Servicer
(except as otherwise provided in the last sentence of this paragraph), for the
benefit of the Trustee, shall enforce the obligations of each Subservicer under
the related Subservicing Agreement, including, without limitation, any
obligation to make advances in respect of delinquent payments as required by a
Subservicing Agreement. Such enforcement, including, without limitation, the
legal prosecution of claims, termination of Subservicing Agreements, 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 Servicer, in its good faith business
judgment, would require were it the owner of the related Mortgage Loans. The
Servicer shall pay the costs of such enforcement at its own expense, and shall
be reimbursed therefor only (i) from a general recovery resulting from such
enforcement, to the extent, if any, that such recovery exceeds all amounts due
in respect of the related Mortgage Loans or (ii) from a specific recovery of
costs, expenses or attorneys' fees against the party against whom such
enforcement is directed.
(c) The Servicer shall cause any Subservicer engaged by the Servicer
(or by any Subservicer) for the benefit of the Depositor, the Securities
Administrator, the Master Servicer and the Trustee to comply with the provisions
of this Section 3.02 and with Sections 3.22, 3.23, 6.02 and 6.05 of this
Agreement to the same extent as if such Subservicer were the Servicer, and to
provide the information required with respect to such Subservicer under Section
8.12 of this Agreement. The Servicer shall be responsible for obtaining from
each such Subservicer and delivering to applicable Persons the Servicer
compliance statement required to be delivered by such Subservicer under Section
3.22 and any assessment of compliance report and related accountant's
attestation required to be delivered by such Subservicer under Section 3.23, in
each case as and when required to be delivered.
(d) Subject to the conditions set forth in this Section 3.02(d), the
Servicer and any Subservicer engaged by the Servicer is permitted to utilize one
or more Subcontractors to perform certain of its obligations hereunder. The
Servicer shall promptly upon request provide to the Depositor a written
description (in form and substance satisfactory to the Depositor) of the role
and function of each Subcontractor utilized by the Servicer or any such
Subservicer, specifying, not later than the date specified for delivery of the
annual report on assessment of compliance set forth in Section 3.23(b) (i) the
identity of each such Subcontractor, if any, that is "participating in the
servicing function" within the meaning of Item 1122 of Regulation AB, and (ii)
which elements of the Servicing Criteria will be addressed in assessments of
compliance provided by each Subcontractor identified pursuant to clause (i) of
this paragraph. As a condition to the utilization by the Servicer or any such
Subservicer of any Subcontractor determined to be materially "participating in
the servicing function" within the meaning of Item 1122 of Regulation AB, the
Servicer shall cause any such Subcontractor used by the Servicer (or by any such
Subservicer) for the benefit of the Depositor, the Securities Administrator, the
Master Servicer and the Trustee to comply with the provisions of Section 3.23 of
this Agreement to the same extent as if such Subcontractor were the Servicer.
The Servicer shall be responsible for obtaining from each such Subcontractor and
delivering to the applicable Persons any assessment of compliance report and
related accountant's attestation required to be delivered by such Subcontractor
under Section 3.23, in each case as and when required to be delivered.
(e) Notwithstanding the foregoing, if the Servicer engages a
Subcontractor in connection with the performance of any of its duties under this
Agreement, the Servicer shall be responsible for determining whether such
Subcontractor is a "servicer" within the meaning of Item 1101 of Regulation AB
and whether any such affiliate or third-party vendor meets the criteria in Item
1108(a)(2)(i) through (iii) of Regulation AB. If the Servicer determines,
pursuant to the preceding sentence, that such Subcontractor is a "servicer"
within the meaning of Item 1101 of Regulation AB and meets the criteria in Item
1108(a)(2)(i) through (iii) of Regulation AB, then such Subcontractor shall be
deemed to be a Subservicer for purposes of this Agreement, the engagement of
such Subservicer shall not be effective unless and until notice is given
pursuant to Section 3.02(a) and the Servicer shall comply with Section 3.02(c)
with respect thereto.
Section 3.03 Successor Subservicers. The Servicer shall be entitled
to terminate any Subservicing Agreement to which it is a party and the rights
and obligations of any Subservicer pursuant to any Subservicing Agreement in
accordance with the terms and conditions of such Subservicing Agreement
provided, however, that the termination, resignation or removal of a Subservicer
shall be not be effective until 30 days after written notice is received by the
Depositor and the Securities Administrator that contains all information
reasonably necessary to enable the Securities Administrator, pursuant to Section
8.12(g), to accurately and timely report the event under Item 6.02 of Form 8-K
pursuant to the Exchange Act (if such reports under the Exchange Act are
required to be filed under the Exchange Act). In the event of termination of any
Subservicer, all servicing obligations of such Subservicer shall be assumed
simultaneously by the Servicer without any act or deed on the part of such
Subservicer or the Servicer, and the Servicer either shall service directly the
related Mortgage Loans or shall enter into a Subservicing Agreement with a
successor Subservicer which qualifies under Section 3.02.
Any Subservicing Agreement shall include the provision that such
agreement may be immediately terminated by the Depositor, the Master Servicer or
the Securities Administrator without fee, in accordance with the terms of this
Agreement, in the event that the Servicer shall, for any reason, no longer be
the Servicer (including termination due to an Event of Default).
Section 3.04 Liability of the Servicer. Notwithstanding any
Subservicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Servicer and a Subservicer or reference
to actions taken through a Subservicer or otherwise, the Servicer shall remain
obligated and primarily liable to the Trustee for the servicing and
administering of the Mortgage Loans in accordance with the provisions of Section
3.01 without diminution of such obligation or liability by virtue of such
Subservicing Agreements or arrangements or by virtue of indemnification from the
Subservicer and to the same extent and under the same terms and conditions as if
the Servicer alone were servicing and administering the Mortgage Loans. The
Servicer shall be entitled to enter into any agreement with a Subservicer for
indemnification of the Servicer by such Subservicer and nothing contained in
this Agreement shall be deemed to limit or modify such indemnification.
Section 3.05 No Contractual Relationship Between Subservicers and
the Trustee. Any Subservicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Subservicer
in its capacity as such shall be deemed to be between the Subservicer and the
Servicer alone, and neither the Trustee nor the Securities Administrator (or any
successor Servicer) shall not be deemed a party thereto and shall have no
claims, rights, obligations, duties or liabilities with respect to the
Subservicer except as set forth in Section 3.06. The Servicer shall be solely
liable for all fees owed by it to any Subservicer, irrespective of whether the
Servicer's compensation pursuant to this Agreement is sufficient to pay such
fees.
Section 3.06 Assumption or Termination of Subservicing Agreements by
Master Servicer. In the event that Saxon at any time shall for any reason no
longer be the Servicer (including by reason of the occurrence of an Event of
Default), the Master Servicer or its designee, or the successor servicer if the
successor is not the Master Servicer, shall thereupon assume all of the rights
and obligations of the Servicer under each Subservicing Agreement that the
Servicer may have entered into, with copies thereof provided to the Master
Servicer, or the successor servicer if the successor is not the Master Servicer,
prior to the Master Servicer, or the successor servicer if the successor is not
the Master Servicer, assuming such rights and obligations, unless the Master
Servicer elects to terminate any Subservicing Agreement in accordance with its
terms as provided in Section 3.03.
Upon such assumption, the Master Servicer, its designee or the
successor servicer shall be deemed, subject to Section 3.03, to have assumed all
of the Servicer's interest therein and to have replaced the Servicer as a party
to each Subservicing Agreement to which the predecessor servicer was a party to
the same extent as if each Subservicing Agreement had been assigned to the
assuming party, except that (i) the Servicer shall not thereby be relieved of
any liability or obligations under any Subservicing Agreement that arose before
it ceased to be the Servicer and (ii) none of the Depositor, the Trustee, the
Master Servicer, their designees or any successor Servicer shall be deemed to
have assumed any liability or obligation of the Servicer that arose before such
predecessor Servicer ceased to be the Servicer.
The Servicer at its expense shall, upon request of the Master
Servicer, deliver to the assuming party all documents and records relating to
the Subservicing Agreement to which it is a party and the Mortgage Loans then
being serviced by it and an accounting of amounts collected and held by or on
behalf of it, and otherwise use its best efforts to effect the orderly and
efficient transfer of the Subservicing Agreements to the assuming party.
Section 3.07 Collection of Certain Mortgage Loan Payments;
Establishment of Certain Accounts. (a) Subject to Section 3.07(o), the Servicer
shall make reasonable efforts to collect all payments called for under the terms
and provisions of the Mortgage Loans, and shall, to the extent such procedures
shall be consistent with this Agreement and the terms and provisions of any
applicable Insurance Policies, follow such collection procedures as it would
follow with respect to mortgage loans comparable to the Mortgage Loans and held
for its own account. Notwithstanding anything in this Agreement to the contrary
and consistent with the foregoing and Accepted Servicing Practices, in the event
that any Mortgage Loan is in default or, in the judgment of the Servicer, such
default is reasonably foreseeable, the Servicer may waive, modify or vary any
term of such Mortgage Loan (including, but not limited to, modifications that
change the Mortgage Rate, forgive the payment of principal or interest or extend
the final maturity date of such Mortgage Loan), accept payment from the related
Mortgagor of an amount less than the Stated Principal Balance in final
satisfaction of such Mortgage Loan or consent to the postponement of strict
compliance with any such term or otherwise grant indulgence to any Mortgagor
(any and all such waivers, modifications, variances, forgiveness of principal or
interest, postponements, or indulgences collectively referred to herein as
"forbearance"). The Servicer's analysis supporting any forbearance and the
conclusion that any forbearance meets the Accepted Servicing Practices shall be
reflected in writing in the Mortgage File. In the event of any such arrangement
pursuant to clause (ii) above, the Servicer shall make timely advances on such
Mortgage Loan during such extension pursuant to Section 4.01 and in accordance
with the amortization schedule of such Mortgage Loan without modification
thereof by reason of such arrangements, subject to Section 4.01(d) pursuant to
which the Servicer shall not be required to make any such advances that are
Nonrecoverable P&I Advances. Notwithstanding the foregoing, the Servicer may not
waive, in whole or in part, a Prepayment Charge, except under the following
circumstances: (i) such waiver relates to a default or a reasonably foreseeable
default and would, in the reasonable judgment of the Servicer, maximize recovery
of total proceeds taking into account the value of such Prepayment Charge and
the related Mortgage Loan, and doing so is standard and customary in servicing
mortgage loans similar to the Mortgage Loans (including any waiver of a
Prepayment Charge in connection with a refinancing of a Mortgage Loan that is
related to a default or a reasonably foreseeable default), and in no event will
the Servicer waive a Prepayment Charge in connection with a refinancing of a
Mortgage Loan that is not related to a default or a reasonably foreseeable
default, or (ii) such Prepayment Charge is not permitted to be collected by
applicable law. If a Prepayment Charge is waived other than as permitted by the
prior sentence, then the Servicer is required to pay the amount of such waived
Prepayment Charge, for the benefit of the Holders of the Class P Certificates,
by depositing such amount into the Collection Account together with and at the
time that the amount prepaid on the related Mortgage Loan is required to be
deposited into the Collection Account. Notwithstanding any provision in this
Agreement to the contrary, in the event the Prepayment Charge payable under the
terms of the Mortgage Note is less than the amount of the Prepayment Charge set
forth in the Mortgage Loan Schedule or other information provided to the
Servicer, the Servicer shall not have any liability or obligation with respect
to such difference, and in addition shall not have any liability or obligation
to pay the amount of any uncollected Prepayment Charge if the failure to collect
such amount is the direct result of inaccurate or incomplete information on the
Mortgage Loan Schedule.
(b) (i) The Securities Administrator shall establish and maintain
the Excess Reserve Fund Account, on behalf of the Class X Certificateholders to
receive any Basis Risk Payment and any Interest Rate Cap Payment and to secure
their limited recourse obligation to pay to the LIBOR Certificateholders Basis
Risk Carry Forward Amounts (prior to using any Net Swap Receipts). For the
avoidance of doubt, any Basis Risk Carry Forward Amounts shall be paid to the
LIBOR Certificates first from the Excess Reserve Fund Account and then from the
Swap Account.
(ii) On each Distribution Date, the Securities Administrator shall
deposit the amount of any Basis Risk Payment made for the benefit of the
Certificateholders and any Interest Rate Cap Payment made for the benefit
of the LIBOR Certificates for such date into the Excess Reserve Fund
Account.
(c) (i) On each Distribution Date on which there exists a Basis Risk
Carry Forward Amount on any Class of Certificates, the Securities Administrator
shall (1) withdraw from the Distribution Account and deposit in the Excess
Reserve Fund Account, as set forth in Section 4.02(a)(iii)(U), the lesser of (a)
the Class X Distributable Amount (without regard to the reduction in clause
(iii) in the definition thereof (to the extent remaining after the distributions
specified in Sections 4.02(a)(iii)(A)-(T), and (b) the Basis Risk Payment and
(2) withdraw from the Excess Reserve Fund Account amounts necessary to pay to
such Class or Classes of Certificates the Basis Risk Carry Forward Amount. Such
payments, including any payments from the Swap Account shall be allocated to
those Classes on a pro rata basis based upon the amount of Basis Risk Carry
Forward Amount owed to each such Class and shall be paid in the priority set
forth in Section 4.02(a)(iii)(W).
(ii) The Securities Administrator shall account for each of the
Supplemental Interest Trust, the Excess Reserve Fund Account and the Swap
Account as an asset of the Grantor Trust and not an asset of any Trust
REMIC. The beneficial owners of the Supplemental Interest Trust, the
Excess Reserve Fund Account and the Swap Account are the Class X
Certificateholders. For all federal tax purposes, amounts transferred by
the Upper-Tier REMIC to the Excess Reserve Fund Account shall be treated
as distributions by the Securities Administrator to the Class X
Certificateholders.
(iii) Any Basis Risk Carry Forward Amounts paid by the Securities
Administrator to the LIBOR Certificateholders shall be accounted for by
the Securities Administrator as amounts paid first to the Holders of the
Class X Certificates and then to the respective Class or Classes of LIBOR
Certificates. In addition, the Securities Administrator shall account for
the LIBOR Certificateholders' rights to receive payments of Basis Risk
Carry Forward Amounts (along with payments of Basis Risk Carry Forward
Amounts and, without duplication, Upper-Tier Carry Forward Amounts from
the Swap Account) and the obligation to pay Class IO Shortfalls as rights
and obligations under a notional principal contract between the Class X
Certificateholders and the Holders of the LIBOR Certificateholders.
(iv) Notwithstanding any provision contained in this Agreement, the
Securities Administrator shall not be required to make any payments from
the Excess Reserve Fund Account except as expressly set forth in this
Section 3.07(c) and Sections 4.02(a)(iii)(V), (W) and (Y).
(d) The Securities Administrator, on behalf of the Trustee, shall
establish and maintain the Distribution Account on behalf of the
Certificateholders. The Securities Administrator shall segregate and hold all
funds in the Distribution Account separate and apart from its own funds and
general assets. The Securities Administrator shall, promptly upon receipt,
deposit in the Distribution Account and retain therein the following:
(i) the aggregate amount remitted by the Servicer to the Master
Servicer pursuant to Section 3.11(a)(i) which amounts the Master Servicer
will then remit to the Securities Administrator prior to the related
distribution date;
(ii) any amount deposited by the Servicer pursuant to Section 3.10
in connection with any losses on Permitted Investments; and
(iii) any other amounts deposited hereunder which are required to be
deposited in the Distribution Account.
In the event that the Servicer remit any amount not required to be
remitted, it may at any time direct the Securities Administrator in writing to
withdraw such amount from the Distribution Account, any provision herein to the
contrary notwithstanding. Such direction may be accomplished by delivering
notice to the Securities Administrator which describes the amounts deposited in
error in the Distribution Account. All funds deposited in the Distribution
Account shall be held by the Securities Administrator in trust for the
Certificateholders until disbursed in accordance with this Agreement or
withdrawn in accordance with Section 4.02. In no event shall the Securities
Administrator incur liability for withdrawals from the Distribution Account at
the direction of the Servicer.
(e) The Securities Administrator, on behalf of the Trustee, shall
establish and maintain the Capitalized Interest Account, on behalf of the
Certificateholders. On the Closing Date, the Securities Administrator shall
deposit $100.00 into the Capitalized Interest Account received from the
Unaffiliated Seller. Withdrawals from the Capitalized Interest Account shall be
made in accordance with Sections 4.02(c) and (d). The Securities Administrator
shall account for the Capitalized Interest Account as an outside reserve fund
within the meaning of Treasury regulations section 1.860G-2(h) and not as an
asset of any REMIC created pursuant to this Agreement. The beneficial owner of
the Capitalized Interest Account shall be the Unaffiliated Seller.
(f) The Securities Administrator, on behalf of the Trustee, shall
establish and maintain the Pre-Funding Account on behalf of the
Certificateholders. On the Closing Date, the Securities Administrator shall
deposit the Initial Pre-Funded Amount into the Pre-Funding Account from the
proceeds of the sale of the LIBOR Certificates. Withdrawals from the Pre-Funding
Account shall be made in accordance with Sections 4.02(e) and (f). The purchase
of Subsequent Mortgage Loans shall be pursuant to a "fixed price contract"
within the meaning of the REMIC Provisions.
(g) The Securities Administrator may invest the funds in the
Accounts, other than the Collection Account, the Excess Reserve Fund Account or
the Distribution Account, with prior written investment direction. With respect
to the Distribution Account and the Excess Reserve Fund Account such funds shall
be held uninvested. With respect to the Pre-Funding Account and the Capitalized
Interest Account such direction shall be provided by the Unaffiliated Seller,
and shall be in Permitted Investments and such directions shall be in accordance
with Section 3.12.
(h) The Servicer shall give prior written notice to the Trustee, the
Securities Administrator, the Master Servicer, each Rating Agency and the
Depositor of any proposed change of the location of the Collection Account.
(i) To help fight the funding of terrorism and money laundering
activities, the Trustee will obtain, verify, and record information that
identifies individuals or entities that establish a relationship or open an
account with the Trustee. The Trustee will ask for the name, address, tax
identification number and other information that will allow the Trustee to
identify the individual or entity who is establishing the relationship or
opening the account. The Trustee may also ask for formation documents such as
articles or incorporation, an offering memorandum, or other identifying
documents to be provided.
(j) The Securities Administrator shall establish and maintain the
Pre-Funding Reserve Account, on behalf of the Class X Certificateholders and the
Unaffiliated Seller. On the Closing Date, the Unaffiliated Seller shall remit to
the Securities Administrator and the Securities Administrator shall deposit
$4,817,363 into the Pre-Funding Reserve Account. The Securities Administrator
shall account for the Pre-Funding Reserve Account as an outside reserve fund
within the meaning of Treasury regulations section 1.860G-2(h) and not as an
asset of any Trust REMIC. For federal income tax purposes, the beneficial owner
of the funds in the Pre-Funding Reserve Account shall be the Unaffiliated
Seller. On the Closing Date, the Class X Certificateholders' rights in the
Pre-Funding Reserve Account will be conveyed to Xxxxx Fargo Bank, National
Association, as indenture trustee on behalf of the Noteholders of the Natixis
Real Estate Capital Inc. NIM 2007-HE2N Notes and shall be subject to the terms
of the NIM Indenture.
(k) On each Subsequent Transfer Date, the amount required to remain
on deposit in the Pre-Funding Reserve Account shall step down to an amount equal
to the product of (a) $4,817,363 multiplied by (b) a fraction, the numerator of
which is the amount remaining in the Pre-Funding Account (after giving effect to
any withdrawals on such Subsequent Transfer Date) and the denominator of which
is the Initial Pre-Funded Amount. Any excess amount that is not required to
remain in the Pre-Funding Reserve Account shall be withdrawn by the Securities
Administrator from the Pre-Funding Reserve Account and released to the
Unaffiliated Seller.
(l) On any Subsequent Transfer Date on which at least 99% of the
Initial Pre-Funded Amount has been used to purchase Subsequent Mortgage Loans,
the Securities Administrator shall withdraw and release to the Unaffiliated
Seller any remaining amounts in the Pre-Funding Reserve Account. If less than
99% of the Initial Pre-Funded Amount has been used to purchase Subsequent
Mortgage Loans, then on the Distribution Date following the end of the
Pre-Funding Period, the Securities Administrator shall (a) withdraw an amount
equal to (i) the percentage of the Initial Pre-Funded Amount not used to
purchase Subsequent Mortgage Loans multiplied by (ii) $4,817,363 and remit such
amount to the Class X Certificateholders and (b) withdraw any remaining amounts
in the Pre-Funding Reserve Account and release such amounts to the Unaffiliated
Seller, and thereafter the Pre-Funding Reserve Account shall be terminated.
(m) [Reserved]
(n) The Securities Administrator shall pay the Trustee an annual fee
based on a separate fee schedule. The fee of the Trustee shall be payable solely
by the Securities Administrator from its own funds. The expenses of the Trustee,
if any, shall be paid from the Trust Fund and the fees and expenses of the
Custodian shall be paid in accordance with Section 8.05.
(o) The Servicer shall pursue collection efforts on Mortgage Loans
which are Delinquent in accordance with the provisions of this Agreement until
the date on which the Mortgage Loan becomes 180 days Delinquent (the "Charge-off
Date"). If the Servicer determines in its sole discretion that net Liquidation
Proceeds with respect to such Mortgage Loan are unlikely to exceed the costs and
expenses of such foreclosure, the Servicer shall charge-off such Mortgage Loan
as of the applicable Charge-off Date. Once a Mortgage Loan is so charged-off,
unless foreclosure proceedings are ongoing or the related Mortgagor has
commenced bankruptcy proceedings, the Servicer shall have the right to appoint
(and to subsequently terminate) one or more agents (none of which may be an
Affiliate of the Servicer) (each a "Deficiency Collection Agent") for the
purpose of pursuing additional collections relating to such charged-off Mortgage
Loans (any such collection, a "Deficiency Collection"); provided, however, that
the Servicer shall not make any such appointment unless the applicable
Deficiency Collection Agent enters into a written agreement with the Servicer
(with a copy to the Trustee) to (i) promptly remit any Deficiency Collection
(net of any fees and expenses the Deficiency Collection Agent is permitted to
retain, as set forth in such agreement) to the Servicer promptly upon receipt by
such Deficiency Collection Agent, (ii) indemnify the Servicer, Trust Fund, the
Trustee, the Unaffiliated Seller and the Depositor and hold them harmless
against any and all claims, losses, penalties, fines, forfeitures, legal fees
and related costs, judgments, and any other costs, liability, fees and expenses
that they may incur or sustain as a result of any act or omission by the
Deficiency Collection Agent, and (iii) make the Trust Fund and the Trustee
third-party beneficiaries of such agreement. The Securities Administrator shall
reasonably cooperate with the Deficiency Collection Agent with respect to its
reasonable requests in connection with obtaining any Deficiency Collection. The
Trustee shall have no obligation to approve of, or consent to, the appointment
or termination of any Deficiency Collection Agent and shall have no obligation
or responsibility to supervise or monitor any of its activities or actions, or
to verify compliance with any written agreement with such Deficiency Collection
Agent.
To the extent a Deficiency Collection Agent recovers any Deficiency
Collection, such Deficiency Collection (net of any fees and expenses the
Deficiency Collection Agent is permitted to retain) shall be remitted by the
Servicer to the Master Servicer on the next Remittance Date and such amount
shall be first, applied as a Subsequent Recovery, if applicable, and second,
distributed by the Securities Administrator on the next Distribution Date as
part of the Available Funds in accordance with Section 4.02.
Section 3.08 Subservicing Accounts. In those cases where a
Subservicer is servicing a Mortgage Loan pursuant to a Subservicing Agreement,
the Subservicer will be required to establish and maintain one or more accounts
(collectively, the "Subservicing Account"). The Subservicing Account shall be an
Eligible Account and shall otherwise be acceptable to the Servicer. The
Subservicer shall deposit in the clearing account (which account must be an
Eligible Account) in which it customarily deposits payments and collections on
mortgage loans in connection with its mortgage loan servicing activities on a
daily basis, and in no event more than one Business Day after the Subservicer's
receipt thereof, all proceeds of Mortgage Loans received by the Subservicer less
its servicing compensation to the extent permitted by the Subservicing
Agreement, and shall thereafter deposit such amounts in the Subservicing
Account, in no event more than two Business Days after the deposit of such funds
into the clearing account. The Subservicer shall thereafter deposit such
proceeds in the Collection Account or remit such proceeds to the Servicer for
deposit in the Collection Account not later than two Business Days after the
deposit of such amounts in the Subservicing Account. For purposes of this
Agreement, the Servicer shall be deemed to have received payments on the
Mortgage Loans when the Subservicer receives such payments.
Section 3.09 Collection of Taxes, Assessments and Similar Items;
Escrow Accounts. (a) The Servicer shall enforce the obligations under each
paid-in-full, life-of-the-loan tax service contract in effect with respect to
each First-Lien Mortgage Loan (each, a "Tax Service Contract") serviced by the
Servicer. Each Tax Service Contract shall be assigned to the Trust at the
Servicer's expense in the event that the Servicer is terminated as servicer of
the related Mortgage Loan.
(b) To the extent that the services described in this paragraph (b)
are not otherwise provided pursuant to the Tax Service Contracts described in
paragraph (a) hereof, the Servicer undertakes to perform such functions. To the
extent the related Mortgage provides for Escrow Payments, the Servicer shall
establish and maintain, or cause to be established and maintained, one or more
accounts (the "Escrow Accounts"), which shall be Eligible Accounts. The Servicer
shall deposit in the clearing account (which account must be an Eligible
Account) in which it customarily deposits payments and collections on mortgage
loans in connection with its mortgage loan servicing activities on a daily
basis, and in no event more than two Business Days after the Servicer's receipt
thereof, all collections from the Mortgagors (or related advances from
Subservicers) for the payment of taxes, assessments, hazard insurance premiums
and comparable items for the account of the Mortgagors ("Escrow Payments")
collected on account of the Mortgage Loans and shall thereafter deposit such
Escrow Payments in the Escrow Accounts, in no event more than one Business Day
after the deposit of such funds in the clearing account, for the purpose of
effecting the payment of any such items as required under the terms of this
Agreement. Withdrawals of amounts from an Escrow Account may be made only to (i)
effect payment of taxes, assessments, hazard insurance premiums, and comparable
items; (ii) reimburse the Servicer (or a Subservicer to the extent provided in
the related Subservicing Agreement) out of related collections for any advances
made pursuant to Section 3.01 (with respect to taxes and assessments) and
Section 3.13 (with respect to hazard insurance); (iii) refund to Mortgagors any
sums as may be determined to be overages; (iv) pay interest, if required and as
described below, to Mortgagors on balances in the Escrow Account; (v) clear and
terminate the Escrow Account at the termination of the Servicer's obligations
and responsibilities in respect of the Mortgage Loans under this Agreement, and
the Servicer shall be entitled to withdraw from the Escrow Account any interest
earned and not required to be paid to the Mortgagors; (vi) to transfer such
funds to a replacement Escrow Account that meets the requirements hereof; or
(vii) recover amounts deposited in error. As part of its servicing duties, the
Servicer or Subservicer shall pay to the Mortgagors interest on funds in Escrow
Accounts, to the extent required by law and, to the extent that interest earned
on funds in the Escrow Accounts is insufficient, to pay such interest from its
or their own funds, without any reimbursement therefor. To the extent that a
Mortgage does not provide for Escrow Payments, the Servicer shall determine
whether any such payments are made by the Mortgagor in a manner and at a time
that avoids the loss of the Mortgaged Property due to a tax sale or the
foreclosure of a tax lien. The Servicer assumes full responsibility for the
payment of all such bills within such time and shall effect 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; provided, however, that such advances are deemed
to be Servicing Advances.
Section 3.10 Collection Accounts. (a) On behalf of the Trustee, the
Servicer shall establish and maintain, or cause to be established and
maintained, a separate Eligible Account (such account, a "Collection Account"),
held in trust for the benefit of the Trustee entitled "Deutsche Bank National
Trust Company on behalf of Natixis Real Estate Capital Trust 2007-HE2". On
behalf of the Trustee, the Servicer shall deposit or cause to be deposited in
the clearing account (which account must be an Eligible Account) in which it
customarily deposits payments and collections on mortgage loans in connection
with its mortgage loan servicing activities on a daily basis, and in no event
more than two Business Days after the Servicer's receipt thereof, and shall
thereafter deposit in the Collection Account, in no event more than one Business
Day after the deposit of such funds into the clearing account, as and when
received or as otherwise required hereunder, the following payments and
collections received or made by it subsequent to the related Cut-off Date (other
than Principal Prepayments) received by it on or prior to the related Cut-off
Date but allocable to a Due Period subsequent thereto:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest (net of the related
Servicing Fee) on each Mortgage Loan;
(iii) all Insurance Proceeds and Condemnation Proceeds to the extent
such Insurance Proceeds and Condemnation Proceeds are not to be applied to
the restoration of the related Mortgaged Property or released to the
related Mortgagor in accordance with the express requirements of law or in
accordance with Accepted Servicing Practices, and Liquidation Proceeds;
(iv) any amounts required to be deposited pursuant to Section 3.12
in connection with any losses realized on Permitted Investments with
respect to funds held in the Collection Account;
(v) any amounts required to be deposited by the Servicer pursuant to
the second paragraph of Section 3.13(a) in respect of any blanket policy
deductibles;
(vi) all proceeds of any Mortgage Loan repurchased or purchased in
accordance with this Agreement;
(vii) all Prepayment Charges collected by the Servicer; and
(viii) any amounts collected or received by the Servicer pursuant to
Section 3.07(o) hereof.
The foregoing requirements for deposit in the 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, NSF
fees, reconveyance fees, assumption fees and other similar fees and charges need
not be deposited by the Servicer in the Collection Account and shall, upon
collection, belong to the Servicer as additional compensation for its servicing
activities. In the event that the Servicer shall deposit in the Collection
Account any amount not required to be deposited therein, the Servicer may at any
time withdraw such amount from the Collection Account, any provision herein to
the contrary notwithstanding.
(b) Funds in the Collection Account may be invested in Permitted
Investments in accordance with the provisions set forth in Section 3.12. The
Servicer shall give notice to the Trustee, the Securities Administrator, the
Master Servicer and the Depositor of the location of the Collection Account
maintained when established and prior to any change thereof.
Section 3.11 Withdrawals from the Collection Account. (a) The
Servicer shall, from time to time, make withdrawals from the Collection Account
for any of the following purposes or as described in Section 4.01:
(i) On or prior to each Remittance Date, to remit to the Master
Servicer the Interest Remittance Amount and the Principal Remittance
Amount in respect of the related Distribution Date together with all
amounts representing Prepayment Charges from the Mortgage Loans received
during the related Prepayment Period;
(ii) to reimburse the Servicer for xxxxxxxxxxxx X&X Advances, but
only to the extent of amounts received which represent Late Collections
(net of the related Servicing Fee) of Scheduled Payments on Mortgage Loans
that it Services with respect to which such P&I Advances were made in
accordance with the provisions of Section 4.01;
(iii) to pay the Servicer, the Master Servicer or any Subservicer
(a) any unpaid Servicing Fee or (b) any unreimbursed Servicing Advances
with respect to each Mortgage Loan that it services, but only to the
extent of any Late Collections, Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds, or other amounts as may be collected by the
Servicer from the related Mortgagor, or otherwise received with respect to
such Mortgage Loan (or the related REO Property);
(iv) to pay to the Servicer as servicing compensation (in addition
to the Servicing Fee) on the Remittance Date any interest or investment
income earned on funds deposited in the Collection Account and any
Prepayment Interest Excesses;
(v) to pay to the Unaffiliated Seller or the related Originator, as
applicable, with respect to each Mortgage Loan that it services that has
previously been purchased or replaced by the Unaffiliated Seller or such
Originator, as applicable, pursuant to this Agreement, all amounts
received thereon subsequent to the date of purchase or substitution, as
the case may be;
(vi) to reimburse the Servicer for (a) any P&I Advance or Servicing
Advance previously made which the Servicer has determined to be a
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance in
accordance with the provisions of Section 4.01 and (b) any unpaid
Servicing Fee to the extent not recoverable from Late Collections,
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, or other
amounts received with respect to the related Mortgage Loan under Section
3.11(a)(iii); provided, that this clause (b) shall only apply with respect
to the Servicing Fee for second lien Mortgage Loans;
(vii) to pay, or to reimburse the Servicer for advances in respect
of, expenses incurred in connection with any Mortgage Loan pursuant to
Section 3.15;
(viii) to reimburse the Servicer, the Master Servicer, the
Depositor, the Custodian, the Securities Administrator or the Trustee for
expenses and/or indemnities incurred by or reimbursable to the Servicer,
the Depositor, the Custodian, the Securities Administrator or the Trustee,
as the case may be, pursuant to Section 6.03;
(ix) to reimburse the Servicer, the Unaffiliated Seller, the
Depositor, the Custodian, the Master Servicer, the Securities
Administrator or the Trustee, as the case may be, for expenses reasonably
incurred in respect of the breach or defect giving rise to the repurchase
obligation under Section 2.03 of this Agreement that were included in the
Repurchase Price of the Mortgage Loan, including any expenses arising out
of the enforcement of the repurchase obligation to the extent not
otherwise paid pursuant to the terms hereof;
(x) to invest funds in Permitted Investments in accordance with
Section 3.12;
(xi) to withdraw any amounts deposited in the Collection Account in
error; and
(xii) to clear and terminate the Collection Account upon termination
of this Agreement.
To the extent that a Servicer does not timely make the remittance
referred to in clause (i) above, such Servicer shall pay the Master Servicer for
the account of the Master Servicer interest on any amount not timely remitted at
the Prime Rate, from and including the applicable Remittance Date to but
excluding the date such remittance is actually made.
(b) The Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from its Collection Account, to the extent held by or on behalf of
it, pursuant to subclauses (a)(ii), (iii), (v), (vi), (vii), (viii) and (ix)
above. The Servicer shall provide written notification to the Master Servicer,
on or prior to the next succeeding Remittance Date, upon making any withdrawals
from the Collection Account pursuant to subclause (a)(vi) above.
(c) The Servicer shall be responsible for reviewing and reconciling
the Collection Account in accordance with Accepted Servicing Practices. The
Servicer shall act promptly to resolve any discrepancies.
Section 3.12 Investment of Funds in the Accounts. (a) The Servicer
may invest funds in its Collection Account and the Master Servicer may direct
the Securities Administrator to invest funds in the Distribution Account, and
the Unaffiliated Seller may direct the Securities Administrator to invest the
funds in the Pre-Funding Account, the Pre-Funding Reserve Account and the
Capitalized Interest Account (each of such Accounts, for purposes of this
Section 3.12, an "Investment Account"), in one or more Permitted Investments
bearing interest or sold at a discount, and maturing, unless payable on demand
no later than the second Business Day immediately preceding the date on which
such funds are required to be withdrawn from such account pursuant to this
Agreement. All such investment directions shall be in writing and if the
Securities Administrator does not receive such written instructions the
Securities Administrator shall invest such amounts in the Xxxxx Fargo Advantage
Prime Money Market Fund. All such Permitted Investments shall be held to
maturity, unless payable on demand. Any investment of funds in an Investment
Account (other than the Collection Account) shall be made in the name of the
Securities Administrator. The Securities Administrator shall be entitled to sole
possession (except with respect to investment direction of funds held in the
related Account and any income and gain realized thereon) over each such
investment, and any certificate or other instrument evidencing any such
investment shall be delivered directly to the Securities Administrator or its
agent, together with any document of transfer necessary to transfer title to
such investment to the Securities Administrator. Any investment of funds in the
Collection Account shall be made in the name of the Servicer. The Servicer shall
be entitled to sole possession (except with respect to investment direction of
funds held in the related Account and any income and gain realized thereon) over
each such investment, and any certificate or other instrument evidencing any
such investment shall be delivered directly to the Servicer or its agent,
together with any document of transfer necessary to transfer title to such
investment to the Servicer. In the event amounts on deposit in an Investment
Account are at any time invested in a Permitted Investment payable on demand,
the Securities Administrator may:
(i) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such Permitted
Investment may otherwise mature hereunder in an amount equal to the lesser
of (1) all amounts then payable thereunder and (2) the amount required to
be withdrawn on such date; and
(ii) demand payment of all amounts due thereunder that such
Permitted Investment would not constitute a Permitted Investment in
respect of funds thereafter on deposit in the Investment Account.
(b) (i) All income and gain realized from the investment of funds
deposited in the Collection Account shall be for the benefit of the Servicer and
shall be subject to its withdrawal in the manner set forth in Section 3.11. The
Servicer shall deposit in the Collection Account the amount of any loss of
principal incurred in respect of any such Permitted Investment directed by the
Servicer made with funds in such accounts immediately upon realization of such
loss, and (ii) all income and gain realized from the investment of funds
deposited in the Pre-Funding Account, the Pre-Funding Reserve Account and the
Capitalized Interest Account held by or on behalf of the Unaffiliated Seller
shall be retained in such Investment Account, subject to withdrawal as provided
in Section 4.02. Whether in regard to the Pre-Funding Account or the Capitalized
Interest Account, the Unaffiliated Seller shall deposit in the Pre-Funding
Account or the Capitalized Interest Account, as applicable, the amount of any
loss of principal incurred in respect of any such Permitted Investment made with
funds in such accounts immediately upon realization of such loss.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Securities Administrator shall take such action as may be
appropriate to enforce such payment or performance, including the institution
and prosecution of appropriate proceedings. The Securities Administrator shall
not be liable for the amount of any loss incurred in respect of any investment
or lack of investment of funds held in any Investment Account or the
Distribution Account if made in accordance with this Section 3.12.
(d) The Securities Administrator and Master Servicer or any of their
Affiliates shall be permitted to receive additional compensation that could be
deemed to be in the Securities Administrator's or Master Servicer's economic
self interest for (i) serving as investment adviser, administrator, shareholder,
servicing agent, custodian or sub custodian with respect to certain of the
Permitted Investments, (ii) using Affiliates to effect transactions in certain
Permitted Investments and (iii) effecting transactions in certain Permitted
Investments. Such compensation shall not be considered an amount that is
reimbursable or payable pursuant to this Agreement.
Section 3.13 Maintenance of Hazard Insurance and Errors and
Omissions and Fidelity Coverage. (a) The Servicer shall cause to be maintained
for each Mortgaged Property securing any Mortgage Loan serviced by the Servicer
fire insurance with extended coverage on the related Mortgaged Property in an
amount which is at least equal to the least of (i) the outstanding principal
balance of such Mortgage Loan, (ii) the amount necessary to fully compensate for
any damage or loss to the improvements that are a part of such property on a
replacement cost basis and (iii) the maximum insurable value of the improvements
which are a part of such Mortgaged Property, in each case in an amount not less
than such amount as is necessary to avoid the application of any coinsurance
clause contained in the related hazard insurance policy. The Servicer shall also
cause to be maintained fire insurance with extended coverage on each REO
Property serviced by the Servicer in an amount which is at least equal to the
lesser of (i) the maximum insurable value of the improvements which are a part
of such property and (ii) the outstanding principal balance of the related
Mortgage Loan at the time it became an REO Property. The Servicer will comply in
the performance of this Agreement with all reasonable rules and requirements of
each insurer under any such hazard policies. Any amounts to be collected by the
Servicer under any such policies (other than amounts to be applied to the
restoration or repair of the property subject to the related Mortgage or amounts
to be released to the Mortgagor in accordance with the procedures that the
Servicer would follow in servicing loans held for its own account, subject to
the terms and conditions of the related Mortgage and Mortgage Note) shall be
deposited in the Collection Account, subject to withdrawal pursuant to Section
3.11. Any cost incurred by the Servicer in maintaining any such insurance shall
not, for the purpose of calculating distributions to the Securities
Administrator, be added to the unpaid principal balance of the related Mortgage
Loan, notwithstanding that the terms of such Mortgage Loan so permit. It is
understood and agreed that no earthquake or other additional insurance is to be
required of any Mortgagor 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 or REO Property is at any time
in an area identified in the Federal Register by the Federal Emergency
Management Agency as having special flood hazards and flood insurance has been
made available, the Servicer will cause to be maintained a flood insurance
policy in respect thereof. Such flood insurance shall be in an amount equal to
the lesser of (i) the unpaid principal balance of the related Mortgage Loan and
(ii) the maximum amount of such insurance available for the related Mortgaged
Property under the national flood insurance program (assuming that the area in
which such Mortgaged Property is located is participating in such program).
In the event that the Servicer shall obtain and maintain a blanket
policy with an insurer having a General Policy Rating of A:X or better from
Best's (or such other rating that is comparable to such rating) insuring against
hazard losses on all of the Mortgage Loans, it shall conclusively be deemed to
have satisfied its obligations as set forth in the first two sentences of this
Section 3.13, it being understood and agreed that such policy may contain a
deductible clause, in which case the Servicer shall, in the event that there
shall not have been maintained on the related Mortgaged Property or REO Property
a policy complying with the first two sentences of this Section 3.13, and there
shall have been one or more losses which would have been covered by such policy,
deposit to the Collection Account from its own funds the amount not otherwise
payable under the blanket policy because of such deductible clause. In
connection with its activities as administrator and servicer of the Mortgage
Loans, the Servicer agrees to prepare and present, on behalf of itself, the
Trustee claims under any such blanket policy in a timely fashion in accordance
with the terms of such policy.
(b) The Servicer shall keep in force during the term of this
Agreement a policy or policies of insurance covering errors and omissions for
failure in the performance of the Servicer's obligations under this Agreement,
which policy or policies shall be in such form and amount that would meet the
requirements of Xxxxxx Mae or Xxxxxxx Mac if it were the purchaser of the
Mortgage Loans, unless the Servicer has obtained a waiver of such requirements
from Xxxxxx Mae or Xxxxxxx Mac. The Servicer shall also maintain a fidelity bond
in the form and amount that would meet the requirements of Xxxxxx Mae or Xxxxxxx
Mac, unless the Servicer has obtained a waiver of such requirements from Xxxxxx
Mae or Xxxxxxx Mac. The Servicer shall provide the Master Servicer with copies
of any such insurance policies and fidelity bond upon the Master Servicer's
request. The Servicer shall be deemed to have complied with this provision if an
Affiliate of the Servicer has such errors and omissions and fidelity bond
coverage and, by the terms of such insurance policy or fidelity bond, the
coverage afforded thereunder extends to the Servicer. Any such errors and
omissions policy and fidelity bond shall by its terms not be canceled by the
Servicer without thirty days' prior written notice to the Trustee and the Master
Servicer. The Servicer shall also cause each Subservicer to maintain a policy of
insurance covering errors and omissions and a fidelity bond which would meet
such requirements.
Section 3.14 Enforcement of Due-On-Sale Clauses Assumption
Agreements. The Servicer will, to the extent it has knowledge of any conveyance
or prospective conveyance of any Mortgaged Property by any Mortgagor (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 the
"due-on-sale" clause, if any, applicable thereto; provided, however, that the
Servicer shall not be required to take such action if, in its sole business
judgment, the Servicer believes it is not in the best interests of the Trust
Fund and shall not exercise any such rights if prohibited by law from doing so.
If the Servicer reasonably believes it is unable under applicable law to enforce
such "due-on-sale" clause or if any of the other conditions set forth in the
proviso to the preceding sentence apply, the Servicer will enter into an
assumption and modification agreement from or with the person to whom such
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. The Servicer is also
authorized 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 the Mortgagor and becomes liable under the Mortgage
Note; provided that no such substitution shall be effective unless such person
satisfies the underwriting criteria of the Servicer, and such substitution is in
the best interest of the Certificateholders as determined by the Servicer. In
connection with any assumption, modification or substitution, the Servicer shall
apply such underwriting standards and follow such practices and procedures as
shall be normal and usual in its general mortgage servicing activities and as it
applies to other mortgage loans owned solely by it. The Servicer shall not take
or enter into any assumption and modification agreement, however, unless (to the
extent practicable in the circumstances) it shall have received confirmation, in
writing, of the continued effectiveness of any applicable hazard insurance
policy, or a new policy meeting the requirements of this Section is obtained.
Any fee collected by the Servicer in respect of an assumption or substitution of
liability agreement will be retained by the Servicer as additional servicing
compensation. In connection with any such assumption, no material term of the
Mortgage Note (including, but not limited to, the related Mortgage Rate and the
amount of the Scheduled Payment) may be amended or modified, except as otherwise
required pursuant to the terms thereof. The Servicer shall notify the Trustee,
the Securities Administrator, the Master Servicer and the Custodian that any
such substitution, modification or assumption agreement has been completed and
shall forward to the Custodian the executed original of such substitution 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.
Notwithstanding the foregoing paragraph 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 by the terms of the Mortgage Note or any
assumption which the Servicer may be restricted by law from preventing, for any
reason whatsoever. For purposes of this Section 3.14, 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 3.15 Realization Upon Defaulted Mortgage Loans. The Servicer
shall use its best efforts, consistent with Accepted Servicing Practices, to,
except with respect to Mortgage Loans that have been charged-off pursuant to
Section 3.07(o), foreclose upon or otherwise comparably convert (which may
include an acquisition of REO Property) 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 3.07, and which are not released from this Agreement
pursuant to any other provision hereof. The Servicer shall use reasonable
efforts to realize upon such defaulted Mortgage Loans in such manner as will
maximize the receipt of principal and interest, 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 from an uninsured cause, the Servicer shall not be required to expend its
own funds toward the restoration of such property unless it shall determine in
its sole discretion (i) that such restoration will increase the net proceeds of
liquidation of the related Mortgage Loan, after reimbursement to itself for such
expenses, and (ii) that such expenses will be recoverable by the Servicer
through Insurance Proceeds, Condemnation Proceeds or Liquidation Proceeds from
the related Mortgaged Property, as contemplated in Section 3.11. The Servicer
shall be responsible for all other costs and expenses incurred by it in any such
proceedings; provided, however, that it shall be entitled to reimbursement
thereof from the related property, as contemplated in Section 3.11.
The proceeds of any liquidation or REO Disposition, as well as any
recovery resulting from a partial collection of Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds or any income from an REO Property, will be
applied in the following order of priority: first, to reimburse the Servicer or
any Subservicer for any related unreimbursed Servicing Advances, pursuant to
Section 3.11 or 3.17; second, to reimburse the Servicer for any related
xxxxxxxxxxxx X&X Advances, pursuant to Section 3.11; third, to accrued and
unpaid interest on the Mortgage Loan or REO Imputed Interest, at the Mortgage
Rate, to the date of the liquidation or REO Disposition, or to the Due Date
prior to the Remittance Date on which such amounts are to be distributed if not
in connection with a liquidation or REO Disposition and fourth, as a recovery of
principal of the Mortgage Loan. If the amount of the recovery so allocated to
interest is less than a full recovery thereof, that amount will be allocated as
follows: first, to unpaid Servicing Fee; and second, as interest at the Mortgage
Rate (net of the Servicing Fee Rate). The portion of the recovery so allocated
to unpaid Servicing Fee shall be reimbursed to the Servicer or any Subservicer
pursuant to Section 3.11 or 3.17. The portions of the recovery so allocated to
interest at the Mortgage Rate (net of the Servicing Fee Rate) and to principal
of the Mortgage Loan shall be applied as follows: first, to reimburse the
Servicer or any Subservicer for any related unreimbursed Servicing Advances in
accordance with Section 3.11 or 3.17, and second, to the Securities
Administrator in accordance with the provisions of Section 4.02, subject to the
last paragraph of Section 3.17 with respect to certain excess recoveries from an
REO Disposition.
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 received actual notice of, or has actual knowledge of
the presence of, hazardous or toxic substances or wastes on the related
Mortgaged Property, or if the Trustee or the Master Servicer otherwise requests,
the Servicer shall cause an environmental inspection or review of such Mortgaged
Property to be conducted by a qualified inspector. Upon completion of the
inspection, the Servicer shall promptly provide the Trustee, the Master Servicer
and the Depositor with a written report of the environmental inspection.
After reviewing the environmental inspection report, the Servicer
shall determine consistent with Accepted Servicing Practices, how to proceed
with respect to the Mortgaged Property. In the event (a) the environmental
inspection report indicates that the Mortgaged Property is contaminated by
hazardous or toxic substances or wastes and (b) the Servicer determines,
consistent with Accepted Servicing Practices, to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure, the Servicer shall be reimbursed
for all reasonable costs associated with such foreclosure or acceptance of a
deed in lieu of foreclosure and any related environmental clean-up costs, as
applicable, from the related Liquidation Proceeds, or if the Liquidation
Proceeds are insufficient to fully reimburse the Servicer, the Servicer shall be
entitled to be reimbursed from amounts in the Collection Account pursuant to
Section 3.11. In the event the Servicer determines not to proceed with
foreclosure or acceptance of a deed in lieu of foreclosure, the Servicer shall
be reimbursed from general collections for all Servicing Advances made with
respect to the related Mortgaged Property from the Collection Account pursuant
to Section 3.11. The Trustee shall not be responsible for any determination made
by the Servicer pursuant to this paragraph or otherwise.
Section 3.16 Release of Mortgage Files. (a) Upon the payment in full
of any Mortgage Loan, or the receipt by the Servicer of a notification that
payment in full shall be escrowed in a manner customary for such purposes, the
Servicer will, within five (5) Business Days of the payment in full, notify the
Trustee, the Securities Administrator and the Custodian 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 Collection Account pursuant to Section 3.10 have been or
will be so deposited) of a Servicing Officer and shall request delivery to it of
the Custodial File. Upon receipt of such certification and Request for Release,
the Custodian shall promptly release the related Custodial File to the Servicer
within five (5) Business Days. No expenses incurred in connection with any
instrument of satisfaction or deed of reconveyance shall be chargeable to the
Collection Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any Insurance Policy relating to the Mortgage Loans, the Custodian shall, upon
request of the Servicer and delivery to the Custodian, of a Request for Release,
release the related Custodial File to the Servicer, and the Trustee shall, at
the direction of the Servicer, execute such documents as shall be necessary to
the prosecution of any such proceedings and the Servicer shall retain the
Mortgage File in trust for the benefit of the Trustee. Such Request for Release
shall obligate the Servicer to return each and every document previously
requested from the Custodial File to the Custodian when the need therefor by the
Servicer no longer exists, unless the Mortgage Loan has been charged-off or
liquidated and the Liquidation Proceeds relating to the Mortgage Loan have been
deposited in the Collection 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 Servicer 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. Upon receipt of a certificate of a Servicing Officer stating that
such Mortgage Loan was charged-off or liquidated and that all amounts received
or to be received in connection with such liquidation that are required to be
deposited into the Collection Account have been so deposited, or that such
Mortgage Loan has become an REO Property, a copy of the Request for Release of
documents shall be released by the Custodian to the Servicer or its designee.
Upon written certification of a Servicing Officer, the Trustee shall
execute and deliver to the Servicer any court pleadings, requests for trustee's
sale or other documents reasonably necessary to the foreclosure or trustee's
sale in respect of a Mortgaged Property or to any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or Mortgage or to obtain a
deficiency judgment, or to enforce any other remedies or rights provided by the
Mortgage Note or Mortgage or otherwise available at law or in equity, or shall
exercise and deliver to the Servicer a power of attorney sufficient to authorize
the Servicer to execute such documents on its behalf. Each such certification
shall include a request that such pleadings or documents be executed by the
Trustee and a statement as to the reason such documents or pleadings are
required and that the execution and delivery thereof by the Trustee will not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee's sale.
Upon receipt of a Request for Release under this Section 3.16, the
Custodian shall deliver the related Custodial File to the Servicer by regular
mail, unless the Servicer requests that the Custodian deliver such Custodial
File to the Servicer by overnight courier (in which case such delivery shall be
at the Servicer's expense). To the extent that the Servicer requires an
overnight courier for such delivery and incurs the related expense due to the
Servicer not having previously received copies of the documents required to be
delivered to the Servicer hereunder, the Unaffiliated Seller shall use
commercially reasonable efforts to assist the Servicer in causing the related
Originator pursuant to the related Mortgage Loan Purchase Agreement to reimburse
the Servicer for such expense.
Section 3.17 Title, Conservation and Disposition of REO Property.
(a) This Section shall apply only to REO Properties acquired for the account of
the Trustee and shall not apply to any REO Property relating to a Mortgage Loan
which was purchased or repurchased from the Trustee pursuant to any provision
hereof. In the event that title to any such REO Property is acquired, the
Servicer shall cause the deed or certificate of sale to be issued in the name of
the Trustee, on behalf of the Certificateholders. Upon written request by the
Servicer, the Trustee shall provide the Servicer with a power of attorney
prepared by the Servicer with respect to such REO Property in the form of
Exhibit P.
(b) The Servicer shall manage, conserve, protect and operate each
REO Property for the Trustee solely for the purpose of its prompt disposition
and sale. The Servicer, either itself or through an agent selected by the
Servicer, shall manage, conserve, protect and operate the REO Property in the
same manner that it manages, conserves, protects and operates other foreclosed
property for its own account, and in the same manner that similar property in
the same locality as the REO Property is managed. The Servicer shall attempt to
sell the same (and may temporarily rent the same for a period not greater than
one year, except as otherwise provided below) on such terms and conditions as
the Servicer deems to be in the best interest of the Trustee on behalf of the
Certificateholders. An independent contractor, as the agent of the Servicer, may
be retained by the Servicer to perform functions relating to the title,
management and disposition of REO Property. The Servicer shall be responsible
for such independent contractor's fees and expenses relating to a REO Property
and shall be entitled to reimbursement thereof from the Liquidation Proceeds
with respect to the related Mortgaged Property, as Servicing Advances or, if
applicable, as Nonrecoverable Servicing Advances. The Trustee shall have no
obligations with respect to any REO Dispositions. The Servicer shall notify the
Trustee, the Master Servicer and the Securities Administrator from time to time
as to the status of each REO Property.
(c) [Reserved].
(d) [Reserved].
(e) The Servicer shall segregate and hold all funds collected and
received in connection with the operation of any REO Property separate and apart
from its own funds and general assets and shall deposit such funds in the
Collection Account.
(f) The Servicer shall deposit net of reimbursement to the Servicer
for any related outstanding P&I Advances, Servicing Advances and unpaid
Servicing Fee provided in Section 3.11, or cause to be deposited, on a daily
basis in the Collection Account all revenues received with respect to the
related REO Property and shall withdraw therefrom funds necessary for the proper
operation, management and maintenance of the REO Property. The Master Servicer
shall retain all initial proceeds from REO Properties until all liquidation
proceeds with respect to such REO Properties have been received.
(g) The Servicer, upon an REO Disposition, shall be entitled to
reimbursement for any related xxxxxxxxxxxx X&X Advances and Servicing Advances
as well as any unpaid Servicing Fee from proceeds received in connection with
the REO Disposition, as further provided in Section 3.11.
(h) Any net proceeds from a REO Disposition which are in excess of
the applicable Stated Principal Balance plus all unpaid REO Imputed Interest
thereon through the date of the REO Disposition shall be retained by the
Servicer as additional servicing compensation.
(i) The Servicer shall use its reasonable best efforts to sell, or
cause the Subservicer to sell, in accordance with Accepted Servicing Practices,
any REO Property serviced by such Servicer or Subservicer as soon as possible,
but in no event later than the conclusion of the third calendar year beginning
after the year of its acquisition by REMIC PF unless (i) the Servicer applies
for and receives an extension of such period from the Internal Revenue Service
pursuant to the REMIC Provisions and Code Section 856(e)(3), in which event such
REO Property shall be sold within the applicable extension period, or (ii) the
Servicer obtains for the Trustee and the Securities Administrator an Opinion of
Counsel, addressed to the Depositor, the Trustee, the Securities Administrator
and the Servicer, to the effect that the holding by REMIC PF of such REO
Property subsequent to such period will not result in the imposition of taxes on
"prohibited transactions" as defined in Section 860F of the Code or cause any
Trust REMIC to fail to qualify as a REMIC under the REMIC Provisions or
comparable provisions of relevant state laws at any time. The Servicer shall
manage, conserve, protect and operate each REO Property that it services for the
Trustee solely for the purpose of its prompt disposition and sale in a manner
which does not cause such REO Property to fail to qualify as "foreclosure
property" within the meaning of Section 860G(a)(8) or result in the receipt by
REMIC PF of any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code or any "net income from foreclosure property" which is
subject to taxation under Section 860G(a)(1) of the Code. Pursuant to its
efforts to sell such REO Property, the Servicer shall either itself or through
an agent selected by the Servicer 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 Trustee on behalf of the Certificateholders, rent the same, or
any part thereof, as the Servicer deems to be in the best interest of the
Trustee on behalf of the Certificateholders for the period prior to the sale of
such REO Property; provided, however, that any rent received or accrued with
respect to such REO Property qualifies as "rents from real property" as defined
in Section 856(d) of the Code.
Section 3.18 Notification of Adjustments. With respect to each
Adjustable Rate Mortgage Loan that it services, the Servicer shall adjust the
Mortgage Rate on the related Adjustment Date and shall adjust the Scheduled
Payment on the related mortgage payment adjustment date, if applicable, in
compliance with the requirements of applicable law and the related Mortgage and
Mortgage Note. In the event that an Index becomes unavailable or otherwise
unpublished, the related Servicer shall select a comparable alternative index
over which it has no direct control and which is readily verifiable. The
Servicer shall execute and deliver any and all necessary notices required under
applicable law and the terms of the related Mortgage Note and Mortgage regarding
the Mortgage Rate and Scheduled Payment adjustments. The Servicer shall
promptly, upon written request therefor, deliver to the Master Servicer such
notifications and any additional applicable data regarding such adjustments and
the methods used to calculate and implement such adjustments. Upon the discovery
by the Servicer or the receipt of notice from the Master Servicer that the
Servicer has failed to adjust a Mortgage Rate or Scheduled Payment in accordance
with the terms of the related Mortgage Note, the Servicer shall deposit in its
Collection Account from its own funds the amount of any interest loss caused as
such interest loss occurs.
Section 3.19 Access to Certain Documentation and Information
Regarding the Mortgage Loans. The Servicer shall provide, or cause the
applicable Subservicer to provide, to the Depositor, the Custodian, the
Unaffiliated Seller, the Securities Administrator, the Master Servicer, the
Trustee, and at the request of the OTS or the FDIC and the examiners and
supervisory agents thereof access to the documentation regarding the Mortgage
Loans in its possession required by applicable regulations of the OTS. Such
access shall be afforded without charge, but only upon reasonable and prior
written request and during normal business hours at the offices of the Servicer
or any Subservicer. Nothing in this Section shall derogate from the obligation
of any such party to observe any applicable law prohibiting disclosure of
information regarding the Mortgagors and the failure of any such party to
provide access as provided in this Section as a result of such obligation shall
not constitute a breach of this Section.
Section 3.20 Documents, Records and Funds in Possession of the
Servicer to be Held for the Securities Administrator. The Servicer shall account
fully to the Trustee, the Master Servicer, the Securities Administrator for any
funds received by the Servicer or which otherwise are collected by the Servicer
as Liquidation Proceeds, Condemnation Proceeds or Insurance Proceeds in respect
of any Mortgage Loan. All Mortgage Files and funds collected or held by, or
under the control of, the Servicer in respect of any Mortgage Loans, whether
from the collection of principal and interest payments or from Liquidation
Proceeds, including, but not limited to, any funds on deposit in the Collection
Account, shall be held by the Servicer 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 Servicer also agrees that it
shall not create, incur or subject any Mortgage File or any funds that are
deposited in any Account, or any funds that otherwise are or may become due or
payable to the Securities Administrator 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 setoff against any Mortgage File or any funds collected on, or
in connection with, a Mortgage Loan, except, however, that the Servicer shall be
entitled to set off against and deduct from any such funds any amounts that are
properly due and payable to the Servicer under this Agreement.
Section 3.21 Servicing Compensation. (a) As compensation for its
activities hereunder, the Servicer shall, with respect to each Mortgage Loan, be
entitled to retain from deposits to its Collection Account and from Liquidation
Proceeds, Condemnation Proceeds, Insurance Proceeds and REO Proceeds related to
such Mortgage Loan, the Servicing Fee with respect to each Mortgage Loan that it
services (less any portion of such amounts retained by any Subservicer). In
addition, the Servicer shall be entitled to recover unpaid Servicing Fee out of
related late collections and as otherwise permitted under Section 3.11. The
right to receive the Servicing Fee may not be transferred in whole or in part
except in connection with the transfer of all of the Servicer's responsibilities
and obligations under this Agreement; provided, however, that the Servicer may
pay from the Servicing Fee any amounts due to a Subservicer pursuant to a
Subservicing Agreement entered into under Section 3.02.
(b) Additional servicing compensation in the form of assumption or
modification fees, late payment charges, NSF fees, reconveyance fees and other
similar fees and charges (other than Prepayment Charges) shall be retained by
the Servicer only to the extent such fees or charges are received by the
Servicer. The Servicer shall also be entitled pursuant to Section 3.11(a)(iv) to
withdraw from the Collection Account, as additional servicing compensation,
interest or other income earned on deposits therein. In addition, the Servicer
shall be entitled to retain Prepayment Interest Excesses (to the extent not
required to offset Prepayment Interest Shortfalls), but only to the extent such
amounts are received by the Servicer.
(c) The Servicer shall be required to pay all expenses incurred by
it in connection with its servicing activities hereunder (including payment of
premiums for any blanket policy insuring against hazard losses pursuant to
Section 3.13, servicing compensation of the Subservicer to the extent not
retained by it and the fees and expenses of independent accountants and any
agents appointed by the Servicer), and shall not be entitled to reimbursement
therefor from the Trust Fund except as specifically provided in Section 3.11.
Section 3.22 Annual Statement as to Compliance. The Servicer, the
Securities Administrator and the Master Servicer shall deliver or cause to be
delivered, and shall cause each Subservicer engaged by the Servicer to deliver
or cause to be delivered to the Master Servicer (and the Master Servicer shall
deliver or otherwise make available to the Depositor, the Securities
Administrator and the Rating Agencies and the Trustee) on or before March 5th
(March 15th with respect to Saxon, but in no event later than March 15th) of
each calendar year, commencing in 2008, an Officer's Certificate stating, as to
each signatory thereof, that (i) a review of the activities of the Securities
Administrator, the Master Servicer, the Servicer or Subservicer, as applicable,
during the preceding calendar year and of its performance under this Agreement
or the applicable Subservicing Agreement, as the case may be, has been made
under such officers' supervision, and (ii) to the best of such officers'
knowledge, based on such review, the Securities Administrator, the Master
Servicer, the Servicer or Subservicer, as applicable, has fulfilled all of its
obligations under this Agreement or the applicable Subservicing Agreement, as
the case may be, in all material respects, throughout such year, or, if there
has been a default in the fulfillment of any such obligation in any material
respect, specifying each such default known to such officers and the nature and
status thereof. Promptly after receipt of each such Officer's Certificate, the
Depositor shall review each such Officer's Certificate and, if applicable,
consult with the Securities Administrator, the Master Servicer, the Servicer or
Subservicer as to the nature of any defaults by the Securities Administrator,
the Master Servicer, the Servicer or any related Subservicer in the fulfillment
of any of the Securities Administrator's, the Master Servicer's, the Servicer's
or any related Subservicer's obligations. The obligations of the Securities
Administrator, the Master Servicer, the Servicer and each Subservicer under this
Section 3.22 apply to the Securities Administrator, the Master Servicer, the
Servicer and each Subservicer that serviced a Mortgage Loan during the
applicable period, whether or not the Securities Administrator, the Master
Servicer, the Servicer or such Subservicer is acting as the Securities
Administrator, the Master Servicer, the Servicer or a Subservicer at the time
such Officer's Certificate is required to be delivered. None of the Servicer,
the Master Servicer, the Securities Administrator or Subservicer or any
Servicing Function Participant shall be required to cause the delivery of any
Officer's Certificate required by this Section until March 10th (March 15th with
respect to Saxon, but in no event later than March 15th) in any given year so
long as it has received written confirmation from the Depositor that a Form 10-K
is not required to be filed in respect of the Trust for the preceding calendar
year.
Section 3.23 Annual Independent Public Accountants' Servicing
Statement; Financial Statements. (a) Not later than March 5th (March 15th with
respect to Saxon, but in no event later than March 15th) of each calendar year
commencing in 2008, the Servicer shall deliver, and shall cause each Subservicer
engaged by the Servicer to deliver, and the Securities Administrator, the Master
Servicer and the Trustee shall deliver or otherwise make available, and the
Servicer, the Securities Administrator, the Master Servicer and the Trustee
shall cause each Subcontractor utilized by the Servicer (or by any such
Subservicer), the Securities Administrator, the Master Servicer or the Trustee,
as applicable, and determined by the Servicer, the Securities Administrator, the
Master Servicer or the Trustee, as applicable, pursuant to Section 3.02(e) to be
"participating in the servicing function" within the meaning of Item 1122 of
Regulation AB (in each case, a "Servicing Function Participant"), to deliver,
each at its own expense, to the Master Servicer (and the Master Servicer shall
make available to the Securities Administrator and the Depositor as part of the
filing package forwarded to the Depositor for review and verification) a report
on an assessment of compliance with the Servicing Criteria applicable to it that
contains (A) a statement by such party of its responsibility for assessing
compliance with the Servicing Criteria applicable to it, (B) a statement that
such party used the Servicing Criteria to assess compliance with the applicable
Servicing Criteria, (C) such party's assessment of compliance with the
applicable Servicing Criteria as of and for the period ending the end of the
fiscal year covered by the Form 10-K required to be filed pursuant to Section
8.12, including, if there has been any material instance of noncompliance with
the applicable Servicing Criteria, a discussion of each such failure and the
nature and status thereof, and (D) a statement that a registered public
accounting firm has issued an attestation report on such Person's assessment of
compliance with the applicable Servicing Criteria as of and for such period.
Each such assessment of compliance report shall be addressed to the Depositor
and signed by an authorized officer of the applicable company, and shall address
each of the applicable Servicing Criteria set forth on Exhibit Q hereto, or as
set forth in the notification furnished to the Depositor and the Securities
Administrator pursuant to Section 3.23(c). The Servicer, the Securities
Administrator, the Master Servicer and the Trustee hereby acknowledge and agree
that their respective assessments of compliance will cover the items identified
on Exhibit Q hereto as being covered by such party. The parties to this
Agreement acknowledge that where a particular Servicing Criteria has multiple
components, each party's assessment of compliance (and related attestation of
compliance) will relate only to those components that are applicable to such
party. Promptly after receipt of each such report on assessment of compliance,
(i) the Depositor shall review each such report and, if applicable, consult with
the Servicer, the Securities Administrator, the Master Servicer or the Trustee
as to the nature of any material instance of noncompliance with the Servicing
Criteria applicable to it (and each Subservicer or Servicing Function
Participant engaged or utilized by the Servicer, such Subservicer, the
Securities Administrator, the Master Servicer or the Trustee, as applicable), as
the case may be. None of the Servicer, the Securities Administrator, the Master
Servicer, or the Trustee or any Subservicer or any Servicing Function
Participant shall be required to cause the delivery of any such assessments
until March 10th (March 15th with respect to Saxon but in no event later than
March 15) in any given year, and the Trustee shall not be required to deliver
any such assessment, so long as it has received written confirmation from the
Depositor that a Form 10-K is not required to be filed in respect of the Trust
for the preceding calendar year.
(b) Not later than March 5th (March 15th with respect to Saxon, but
in no event later than March 15th) of each calendar year commencing in 2008,
the Servicer, the Securities Administrator, the Master Servicer and the Trustee
shall cause, and such Servicer shall cause each Subservicer engaged by such
Servicer and the Servicer, the Securities Administrator and the Master Servicer
and the Trustee shall cause each Servicing Function Participant utilized by the
Securities Administrator, the Master Servicer, the Trustee or the Servicer, as
applicable (or by any Subservicer engaged by such Servicer) to cause, each at
its own expense, a registered public accounting firm (which may also render
other services to such party) and that is a member of the American Institute of
Certified Public Accountants to furnish a report to the Master Servicer (and the
Master Servicer shall make available to the Securities Administrator and the
Depositor as part of the filing package forwarded to the Depositor for review
and verification, with a copy to the Rating Agencies), to the effect that (i) it
has obtained a representation regarding certain matters from the management of
such Person, which includes an assertion that such Person has complied with the
Servicing Criteria applicable to it pursuant to Section 3.23(a) and (ii) on the
basis of an examination conducted by such firm in accordance with standards for
attestation engagements issued or adopted by the PCAOB, that attests to and
reports on such Person's assessment of compliance with the Servicing Criteria
applicable to it. In the event that an overall opinion cannot be expressed, such
registered public accounting firm shall state in such report why it was unable
to express such an opinion. Each such related accountant's attestation report
shall be made in accordance with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X
under the Securities Act and the Exchange Act. Such report must be available for
general use and not contain restricted use language. Promptly after receipt of
each such accountants' attestation report, the Depositor shall review the report
and, if applicable, consult with the Servicer, the Master Servicer, the
Securities Administrator or the Trustee as to the nature of any defaults by the
Servicer, the Securities Administrator, the Master Servicer or the Trustee (and
each Subservicer or Servicing Function Participant engaged or utilized by the
Servicer, the Securities Administrator, the Master Servicer or the applicable
Trustee, or by any Subservicer engaged by the Servicer), as the case may be, in
the fulfillment of the Servicer's, the Securities Administrator's, the Master
Servicer's, the Trustee's, or the applicable Subservicer's or Servicing Function
Participant's obligations hereunder or under any applicable sub-servicing
agreement. None of the Securities Administrator, the Master Servicer, the
Servicer, the Trustee or any Servicing Function Participant shall be required to
cause the delivery of any such attestation required by this paragraph until
March 10th (March 15th with respect to Saxon, but in no event later than March
15) in any given year, and the Trustee shall not be required to deliver any
such assessment, so long as it has received written confirmation from the
Depositor that a Form 10-K is not required to be filed in respect of the Trust
for the preceding calendar year.
(c) Promptly upon written request from the Depositor, the Servicer
shall notify the Securities Administrator and the Depositor as to the name of
each Subservicer engaged by the Servicer and each Servicing Function Participant
utilized by the Servicer and by each Subservicer engaged by such Servicer, but
only to the extent there has been a change in the information in such
notification from notices previously delivered and the Securities Administrator
and the Master Servicer shall notify the Depositor and the Securities
Administrator as to the name of each Servicing Function Participant utilized by
it, and each such notice will specify what specific Servicing Criteria will be
addressed in the report on assessment of compliance prepared by such Subservicer
and Servicing Function Participant in each case, to the extent of any change
from the prior year's notice, if any. When the Servicer, the Securities
Administrator or the Master Servicer submits its assessment pursuant to Section
3.23(a), the Servicer, the Securities Administrator or the Master Servicer, as
applicable, will also at such time include the assessment (and related
attestation pursuant to Section 3.23(b)) of each Servicing Function Participant
utilized by it and by each Subservicer engaged by it.
(d) The obligations of the Securities Administrator, the Master
Servicer, the Trustee, the Servicer or Subservicer under this Section apply to
the Securities Administrator, the Master Servicer and the Trustee, and the
Servicer and Subservicer that serviced a Mortgage Loan during the applicable
period, whether or not such Securities Administrator, the Master Servicer, the
Trustee, Servicer or Subservicer is acting as Securities Administrator, Master
Servicer, Trustee, Servicer or Subservicer, as applicable, at the time such
assessment of compliance with Servicing Criteria and related accountant's
attestation is required to be delivered.
Section 3.24 Master Servicer to Act as Servicer.
(a) [Reserved].
(b) In the event that Saxon shall for any reason no longer be the
Servicer hereunder (including by reason of an Event of Default), except as
provided under Section 7.02, the Master Servicer or its successor shall, within
90 days, assume all of the rights and obligations of Saxon hereunder arising
thereafter (except that the Master Servicer shall not be (i) liable for losses
of Saxon pursuant to Section 3.10 or any acts or omissions of the predecessor
Servicer hereunder, (ii) obligated to make Advances if it is prohibited from
doing so by applicable law, (iii) obligated to effectuate repurchases or
substitutions of Mortgage Loans hereunder, including, but not limited to,
repurchases or substitutions pursuant to Section 2.03, (iv) responsible for
expenses incurred by, or advances made by, the predecessor Servicer or (v)
deemed to have made any representations and warranties of the Servicer
hereunder).
Every Subservicing Agreement entered into by the Servicer shall
contain a provision giving the successor Servicer the option to terminate such
agreement in the event a successor Servicer is appointed.
If the Servicer shall for any reason no longer be the Servicer
(including by reason of any Event of Default), the Master Servicer (or any other
successor Servicer) may, at its option, succeed to any rights and obligations of
the Servicer under any Subservicing Agreement in accordance with the terms
thereof; provided that the Master Servicer (or any other successor Servicer)
shall not incur any liability or have any obligations in its capacity as
successor Servicer under a Subservicing Agreement arising prior to the date of
such succession unless it expressly elects to succeed to the rights and
obligations of the Servicer thereunder; and the Servicer shall not thereby be
relieved of any liability or obligations under the Subservicing Agreement
arising prior to the date of such succession.
The Servicer shall, upon request of the Master Servicer, as
applicable, but at the expense of the Servicer, deliver to the assuming party
all documents and records relating to each Subservicing Agreement (if any) and
the Mortgage Loans then being serviced thereunder and an accounting of amounts
collected and held by it and otherwise use its best efforts to effect the
orderly and efficient transfer of the Subservicing Agreement to the assuming
party.
Section 3.25 Compensating Interest. The Servicer shall remit to the
Master Servicer on each Remittance Date for deposit in the Distribution Account
an amount from its own funds equal to the Compensating Interest payable by the
Servicer for the related Distribution Date.
Section 3.26 Credit Reporting; Xxxxx-Xxxxx-Xxxxxx Act. (a) With
respect to each Mortgage Loan that it services, the Servicer agrees to fully
furnish, in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (i.e., favorable and unfavorable)
on its borrower credit files to Equifax, Experian, and Trans Union Credit
Information Company (three of the national credit repositories), on a monthly
basis.
(b) The Servicer shall comply with Title V of the Xxxxx-Xxxxx-Xxxxxx
Act of 1999 and all applicable regulations promulgated thereunder, relating to
the Mortgage Loans that it services and the related borrowers and shall provide
all required notices thereunder.
ARTICLE IV
DISTRIBUTIONS AND ADVANCES BY THE SERVICER
Section 4.01 Advances. (a) The amount of P&I Advances to be made by
the Servicer for any Remittance Date shall equal, subject to Section 4.01(c),
the sum of (i) with respect to the Mortgage Loans, the aggregate amount of
Scheduled Payments (with each interest portion thereof net of the related
Servicing Fee), due during the Due Period immediately preceding such Remittance
Date in respect of such Mortgage Loans, which Scheduled Payments were not
received as of the close of business on the related Determination Date
(provided, however, that with respect to any Balloon Loan that is delinquent on
its maturity date, the applicable Servicer will not be required to advance the
principal portion of the related balloon payment but will be required to
continue to make P&I Advances in accordance with this Section 4.01(a) with
respect to such Balloon Loan in an amount equal to the assumed scheduled
interest that would otherwise be due based on the original amortization schedule
for such Balloon Loan (with interest at the Adjusted Net Mortgage Rate)), plus
(ii) with respect to each REO Property, which REO Property was acquired during
or prior to the related Prepayment Period and as to which such REO Property an
REO Disposition did not occur during the related Prepayment Period, an amount
equal to the excess, if any, of the Scheduled Payments (with each interest
portion thereof net of the related Servicing Fee) that would have been due on
the related Due Date in respect of the related Mortgage Loans, over the net
income from such REO Property transferred to the Collection Account for
distribution on such Remittance Date.
(b) On each Remittance Date, the Servicer shall remit in immediately
available funds to the Master Servicer an amount equal to the aggregate amount
of P&I Advances, if any, to be made in respect of the Mortgage Loans and REO
Properties serviced by the Servicer for the related Remittance Date either (i)
from its own funds, (ii) from the Collection Account, to the extent of funds
held therein for future distribution (in which case, it will cause to be made an
appropriate entry in the records of the Collection Account that Amounts Held for
Future Distribution have been, as permitted by this Section 4.01, used by the
Servicer in discharge of any such P&I Advance) or (iii) in the form of any
combination of (i) and (ii) aggregating the total amount of P&I Advances to be
made by the Servicer with respect to the Mortgage Loans and REO Properties. Any
Amounts Held For future Distribution and so used shall be appropriately
reflected in the Servicer's records and replaced by the Servicer by deposit in
the Collection Account on or before any future Remittance Date to the extent
required.
(c) The obligation of the Servicer to make such P&I Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
paragraph (d) below, and, with respect to any Mortgage Loan or REO Property,
shall continue until a Final Recovery Determination in connection therewith or
the removal thereof from coverage under this Agreement, except as otherwise
provided in this Section.
(d) Notwithstanding anything herein to the contrary, no P&I Advance
or Servicing Advance shall be required to be made hereunder by the Servicer if
such P&I Advance or Servicing Advance would, if made, constitute a
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance. The Servicer may
determine at any time that an Advance made constitutes a Nonrecoverable P&I
Advance or a Nonrecoverable Servicing Advance, as applicable. The determination
by the Servicer that it has made a Nonrecoverable P&I Advance or a
Nonrecoverable Servicing Advance or that any proposed P&I Advance or Servicing
Advance, if made, would constitute a Nonrecoverable P&I Advance or a
Nonrecoverable Servicing Advance, respectively, shall be evidenced by an
Officers' Certificate of the Servicer delivered to the Securities Administrator
and Master Servicer.
(e) The Servicer shall be entitled to reimbursement for P&I Advances
and Servicing Advances as and to the extent set forth in Section 3.11.
(f) On each Remittance Date, the Master Servicer shall deposit all
funds remitted to it by the Servicer pursuant to Sections 3.11(a)(i) and 3.25
and this Section 4.01 in a segregated Eligible Account for the benefit of the
Certificateholders and, prior to each Distribution Date, will remit such amounts
to the Securities Administrator for deposit in the Distribution Account. The
Master Servicer may retain or withdraw from the Distribution Account, (i) the
Securities Administrator and Master Servicer Fee, (ii) amounts necessary to
reimburse it for any previously unreimbursed Advances and any Advances the
Master Servicer deems to be nonrecoverable from the related Mortgage Loan
proceeds, (iii) an amount to indemnify itself for amounts due in accordance with
this Agreement, and (iv) any other amounts that it is entitled to receive
hereunder for reimbursement, indemnification or otherwise. The amounts remitted
by the Servicer to the Master Servicer on the Servicer Remittance Date shall be
credited to the Master Servicing Account within 2 Business Days once the amounts
are identified as a remittance in connection with the trust and reconciled to
the reports provided by the Servicer.
Section 4.02 Priorities of Distribution. (a) On each Distribution
Date, the Securities Administrator shall, solely in accordance with the
information provided by the Master Servicer, allocate from amounts then on
deposit in the Distribution Account in the following order of priority and to
the extent of the Available Funds remaining:
(i) to the Holders of each class of LIBOR Certificates and the Swap
Account in the following order of priority:
(A) to the Swap Account, the sum of (x) all Net Swap Payments and
(y) any Swap Termination Payment owed to the Swap Provider
other than a Defaulted Swap Termination Payment owed to the
Swap Provider (to the extent a Replacement Swap Provider
Payment has not been made to the Swap Account), if any; and
(B) from the Interest Remittance Amount, after taking into account
payment to the Swap Account pursuant to Section 4.02(a)(i)(A),
in the following order of priority:
(1) concurrently, to the holders of the Class A
Certificates, pro rata, based on their respective Class
Certificate Balances, the Accrued Certificate Interest
and any Unpaid Interest Amount for each class of Class A
Certificates;
(2) from any remaining Interest Remittance Amount,
to the Class M-1 Certificates, the Accrued Certificate
Interest for such Class on such Distribution Date;
(3) from any remaining Interest Remittance Amount,
to the Class M-2 Certificates, the Accrued Certificate
Interest for such Class on such Distribution Date;
(4) from any remaining Interest Remittance Amount, to the
Class M-3 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(5) from any remaining Interest Remittance Amount, to the
Class M-4 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(6) from any remaining Interest Remittance Amount, to the
Class M-5 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(7) from any remaining Interest Remittance Amount, to the
Class M-6 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(8) from any remaining Interest Remittance Amount, to the
Class B-1 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(9) payable from any remaining Interest Remittance Amount,
to the Class B-2 Certificates, the Accrued Certificate
Interest for such Class on such Distribution Date;
(10) from any remaining Interest Remittance Amount, to the
Class B-3 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date; and
(11) from any remaining Interest Remittance Amount, to the
Class B-4 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date.
(ii) (x) on each Distribution Date (A) before the Stepdown Date or
(B) with respect to which a Trigger Event is in effect, to the Holders of
the Class or Classes of LIBOR Certificates then entitled to distributions
of principal as set forth below from the amounts remaining on deposit in
the Distribution Account after making distributions pursuant to clause (i)
above, in an amount equal to the Principal Distribution Amount in the
following order of priority:
(A) to the Holders of the Class A Certificates, first, to the
Class A-1 Certificates until the Certificate Balance of the
Class A-1 Certificates has been reduced to zero, second, to
the Class A-2 Certificates until the Certificate Balance of
the Class A-2 Certificates has been reduced to zero, third, to
the Class A-3 Certificates until the Certificate Balance of
the Class A-3 Certificates has been reduced to zero and
fourth, to the Class A-4 Certificates until the Certificate
Principal Balance of the Class A-4 Certificates has been
reduced to zero; provided, however, that on and after the
Distribution Date on which the aggregate Class Certificate
Balances of the Subordinated Certificates and the principal
balance of the Class X Certificates have been reduced to zero,
any principal distributions allocated to the Class A
Certificates shall be allocated pro rata among the Class A-1,
Class A-2, Class A-3 and Class A-4 Certificates, based on
their respective Class Certificate Balances, and distributed
concurrently to the Class A-1, Class A-2, Class A-3 and Class
A-4 Certificates; and
(B) 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, until the respective
Class Certificate Balances are reduced to zero;
(y) on each Distribution Date (1) on and after the Stepdown
Date and (2) as long as a Trigger Event is not in effect, to the Holders
of the related Class or Classes of LIBOR Certificates then entitled to
distribution of principal from amounts remaining on deposit in the
Distribution Account after making distributions pursuant to clause (i)
above, in an amount equal to, in the aggregate, the Principal Distribution
Amount in the following amounts and order of priority:
(A) to the Class A Certificates, the lesser of the Principal
Distribution Amount and the Class A Principal Distribution
Amount, allocated among the Class A Certificates, first, to
the Class A-1 Certificates until the Certificate Balance of
the Class A-1 Certificates has been reduced to zero, second,
to the Class A-2 Certificates until the Certificate Balance of
the Class A-2 Certificates has been reduced to zero, third, to
the Class A-3 Certificates until the Certificate Balance of
the Class A-3 Certificates has been reduced to zero and
fourth, to the Class A-4 Certificates until the Certificate
Balance of the Class A-4 Certificates has been reduced to
zero; provided, however, that on and after the Distribution
Date on which the aggregate Class Certificate Balances of the
Subordinated Certificates and the principal balance of the
Class X Certificates have been reduced to zero, any principal
distributions allocated to the Class A Certificates shall be
allocated pro rata among the Class A-1, Class A-2, Class A-3
and Class A-4 Certificates, based on their respective Class
Certificate Balances, and distributed concurrently to the
Class A-1, Class A-2, Class A-3 and Class A-4 Certificates;
(B) to the Class M-1 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-1 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(C) to the Class M-2 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-2 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(D) to the Class M-3 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-3 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(E) to the Class M-4 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-4 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(F) to the Class M-5 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-5 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(G) to the Class M-6 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-6 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(H) to the Class B-1 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class B-1 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(I) to the Class B-2 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class B-2 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(J) to the Class B-3 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class B-3 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero; and
(K) to the Class B-4 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class B-4 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero; and
(iii) any amount remaining in the Distribution Account after the
distributions in clauses (i) and (ii) above, plus as specifically
indicated below, from amounts on deposit in the Excess Reserve Fund
Account, shall be distributed in the following order of priority:
(A) to the Holders of the Class M-1 Certificates, any Unpaid
Interest Amount for such Class;
(B) to the Holders of the Class M-1 Certificates, any Unpaid
Realized Loss Amount for such Class;
(C) to the Holders of the Class M-2 Certificates, any Unpaid
Interest Amount for such Class;
(D) to the Holders of the Class M-2 Certificates, any Unpaid
Realized Loss Amount for such Class;
(E) to the Holders of the Class M-3 Certificates, any Unpaid
Interest Amount for such Class;
(F) to the Holders of the Class M-3 Certificates, any Unpaid
Realized Loss Amount for such Class;
(G) to the Holders of the Class M-4 Certificates, any Unpaid
Interest Amount for such Class;
(H) to the Holders of the Class M-4 Certificates, any Unpaid
Realized Loss Amount for such Class;
(I) to the Holders of the Class M-5 Certificates, any Unpaid
Interest Amount for such Class;
(J) to the Holders of the Class M-5 Certificates, any Unpaid
Realized Loss Amount for such Class;
(K) to the Holders of the Class M-6 Certificates, any Unpaid
Interest Amount for such Class;
(L) to the Holders of the Class M-6 Certificates, any Unpaid
Realized Loss Amount for such Class;
(M) to the Holders of the Class B-1 Certificates, any Unpaid
Interest Amount for such Class;
(N) to the Holders of the Class B-1 Certificates, any Unpaid
Realized Loss Amount for such Class;
(O) to the Holders of the Class B-2 Certificates, any Unpaid
Interest Amount for such Class;
(P) to the Holders of the Class B-2 Certificates, any Unpaid
Realized Loss Amount for such Class;
(Q) to the Holders of the Class B-3 Certificates, any Unpaid
Interest Amount for such Class;
(R) to the Holders of the Class B-3 Certificates, any Unpaid
Realized Loss Amount for such Class;
(S) to the Holders of the Class B-4 Certificates, any Unpaid
Interest Amount for such Class;
(T) to the Holders of the Class B-4 Certificates, any Unpaid
Realized Loss Amount for such Class;
(U) to the Excess Reserve Fund Account, the amount of any Basis
Risk Payment for such Distribution Date;
(V) from any Interest Rate Cap Payment on deposit in the Excess
Reserve Fund Account with respect to that Distribution Date,
an amount equal to any unpaid Basis Risk Carry Forward Amount
with respect to the LIBOR Certificates for that Distribution
Date, allocated first, among those Classes of Certificates,
pro rata, based upon their respective Class Certificate
Balances, and second, any remaining amounts allocated among
those Classes of Certificates, pro rata, based on any Basis
Risk Carry Forward Amounts remaining unpaid, in order to
reimburse such unpaid amounts;
(W) from amounts on deposit in the Excess Reserve Fund Account
(not including any Interest Rate Cap Payment on deposit
therein), an amount equal to any unpaid Basis Risk Carry
Forward Amount, prior to application of any amounts on deposit
in the Swap Account (after taking into account any payments
made pursuant to Section 4.02(a)(iii)(V) above), with respect
to any LIBOR Certificates allocated to the LIBOR Certificates
in the same order and priority in which Accrued Certificate
Interest is allocated among those Classes of Certificates,
with the allocation to the Class A Certificates being further
allocated: first, between the Class A-1, Class A-2, Class A-3
and Class A-4 Certificates pro rata, based upon their
respective Class Certificate Balances and second, any
remaining amounts to the Class A-1, Class A-2, Class A-3 and
Class A-4 Certificates, pro rata, based on any Basis Risk
Carry Forward Amounts remaining unpaid, in order to reimburse
such unpaid amounts;
(X) to the Swap Account, the amount of any Defaulted Swap
Termination Payment owed to the Swap Provider;
(Y) to the Holders of the Class X Certificates, the remainder of
the Class X Distributable Amount not distributed pursuant to
Sections 4.02(a)(iii)(A)-(X) (including any remaining Interest
Rate Cap Payments on deposit in such account);
(Z) to the Class R Certificates, any remaining amount in the Trust
REMICs, in respect of REMIC PF, Pooling-Tier REMIC 1,
Pooling-Tier REMIC 2, the Lower-Tier REMIC and the Upper-Tier
REMIC; and
(AA) to the Class RX Certificates, any remaining amount, in respect
of the Class X REMIC.
(b) On each Distribution Date prior to any distributions on any
other Class of Certificates, all amounts representing Prepayment Charges from
the Mortgage Loans received during the related Prepayment Period shall be
distributed by the Securities Administrator to the Holders of the Class P
Certificates.
(c) On the May 2007 and June 2007 Distribution Dates and on July 24,
2007, the Securities Administrator shall transfer from the Capitalized Interest
Account to the Distribution Account the Capitalized Interest Requirement, if
any, for such Distribution Date.
(d) On either the Distribution Date following the final Subsequent
Transfer Date or July 24, 2007, whichever date is earlier, any amounts remaining
in the Capitalized Interest Account and all Pre-Funding Earnings in the
Pre-Funding Account, after taking into account the transfers in respect of the
Distribution Date described in clause (c) above, shall be paid by the Securities
Administrator to the Unaffiliated Seller.
(e) On each Subsequent Transfer Date, the Unaffiliated Seller shall
instruct in writing the Securities Administrator to withdraw from the
Pre-Funding Account an amount equal to 100% of the aggregate Stated Principal
Balances as of the related Subsequent Cut-off Date of the Subsequent Mortgage
Loans sold to the Trust Fund on such Subsequent Transfer Date and pay such
amount to or upon the order of the Unaffiliated Seller upon satisfaction of the
conditions set forth in Section 2.01(c) with respect to such transfer. The
Securities Administrator may conclusively rely on such written instructions from
the Unaffiliated Seller.
(f) If the Pre-Funding Amount available in the Pre-Funding Account
(exclusive of Pre-Funding Earnings) has been reduced to $100,000 or less by the
close of business on July 24, 2007 then, on the July 25, 2007 Distribution Date,
after giving effect to any reductions in such Pre-Funding Amount on such date,
the Securities Administrator shall withdraw from the Pre-Funding Account on such
date and deposit in the Distribution Account the amount on deposit in such
Pre-Funding Account other than any Pre-Funding Earnings; if the Pre-Funding
Amount available in such Pre-Funding Account has not been reduced to zero by the
close of business on July 24, 2007, the Securities Administrator shall withdraw
from such Pre-Funding Account the amount on deposit therein, other than the
Pre-Funding Earnings, and deposit such amount into the Distribution Account on
such day for distribution on the July 25, 2007 Distribution Date into the
Distribution Account. Any amount deposited into the Distribution Account
pursuant to the preceding sentence from the Pre-Funding Account shall be
distributed to the Class A Certificates until those Certificates are reduced to
zero; provided that amounts allocated to the Class A Certificates shall be
allocated as follows: first, to the Class A-1 Certificates until the Certificate
Balance of the Class A-1 Certificates has been reduced to zero, second, to the
Class A-2 Certificates until the Certificate Balance of the Class A-2
Certificates has been reduced to zero, and third, to the Class A-3 Certificates
until the Certificate Balance of the Class A-3 Certificates has been reduced to
zero, as a separate payment of principal, on the related Distribution Date.
(g) On any Distribution Date, any Relief Act Interest Shortfalls and
Net Prepayment Interest Shortfalls for such Distribution Date shall be allocated
by the Securities Administrator as a reduction in the following order:
(1) First, to the portion of the Class X Distributable Amount
allocable to interest; and
(2) second, pro rata, as a reduction of the Accrued Certificate
Interest for the Class A-1, Class A-2, Class X-0, Xxxxx X-0, 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, based on the amount of interest
to which such Classes would otherwise be entitled.
(h) Notwithstanding any other provision of this Agreement, the
Securities Administrator shall comply with all federal withholding requirements
respecting payments made or received under the Interest Rate Swap Agreement and
the Interest Rate Cap Agreement and 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. If 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. Such amounts shall be deemed to have been distributed to
such Certificateholders for all purposes of this Agreement.
Section 4.03 Monthly Statements to Certificateholders. (a) Not later
than each Distribution Date, the Securities Administrator shall make available
to each Certificateholder, the Servicer, the Depositor, the Unaffiliated Seller,
the Trustee, the Master Servicer, the Swap Provider, the Cap Provider and each
Rating Agency a statement (the "Monthly Statement"), based solely on the
information provided by the Master Servicer two Business Days prior to the
Distribution Date, setting forth with respect to the related distribution:
(i) the amount thereof allocable to principal, separately
identifying the aggregate amount of any Principal Prepayments and
Liquidation Proceeds included therein;
(ii) the amount thereof allocable to interest, any Unpaid Interest
Amounts included in such distribution and any remaining Unpaid Interest
Amounts after giving effect to such distribution, any Basis Risk Carry
Forward Amount for such Distribution Date and the amount of all Basis Risk
Carry Forward Amount covered by withdrawals from the Excess Reserve Fund
Account on such Distribution Date;
(iii) if the distribution to the Holders of such Class of
Certificates is less than the full amount that would be distributable to
such Holders if there were sufficient funds available therefor, the amount
of the shortfall and the allocation thereof as between principal and
interest, including any Basis Risk Carry Forward Amount not covered by
amounts in the Excess Reserve Fund Account;
(iv) the Class Certificate Balance of each Class of Certificates
after giving effect to the distribution of principal on such Distribution
Date;
(v) the Pool Stated Principal Balance for the following Distribution
Date;
(vi) the amount of the Expense Fees (stated separately and in the
aggregate) paid to or retained by (i) the Servicer with respect to such
Distribution Date and (ii) the Master Servicer and the Securities
Administrator;
(vii) the Pass-Through Rate for each such Class of Certificates with
respect to such Distribution Date;
(viii) the amount of Advances included in the distribution on such
Distribution Date and the aggregate amount of Advances reported by the
Servicer as outstanding as of the close of business on such Distribution
Date;
(ix) the number and aggregate Scheduled Principal Balances of
Mortgage Loans (1) as to which the Scheduled Payment is Delinquent 31 to
60 days, 61 to 90 days and 91 or more days, (2) that have become REO
Property, (3) that are in foreclosure and (4) that are in bankruptcy, in
each case as of the close of business on the last Business Day of the
immediately preceding calendar month as reported in the OTS methodology;
(x) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number and Stated Principal
Balance of such Mortgage Loan as of the close of business on the last
Business Day of the immediately preceding calendar month and the date of
acquisition thereof;
(xi) the total number and aggregate principal balance of any REO
Properties (and market value, if available) as of the close of business on
the last Business Day of the immediately preceding month;
(xii) whether a Trigger Event has occurred and is continuing
(including the calculation of thereof and the aggregate outstanding
balance of all 60+ Day Delinquent Loans);
(xiii) the amount on deposit in the Excess Reserve Fund Account
(after giving effect to distributions on such Distribution Date);
(xiv) for each Class of Certificates, the amount of Applied Realized
Loss Amounts incurred during the preceding calendar month and aggregate
Applied Realized Loss Amounts through such Distribution Date;
(xv) the aggregate amount of Subsequent Recoveries incurred during
the preceding calendar month and aggregate Subsequent Recoveries through
such Distribution Date;
(xvi) the amount of any Net Monthly Excess Cash Flow on such
Distribution Date and the allocation thereof to the Certificateholders
with respect to Applied Realized Loss Amounts and Unpaid Interest Amounts;
(xvii) the Subordinated Amount and Specified Subordinated Amount;
(xviii) the Interest Remittance Amount, the Principal Remittance
Amount and the Prepayment Charges remitted by the Servicer with respect to
that Distribution Date;
(xix) the Pre-Funded Amount as of the end of the prior Due Period;
(xx) the amount of any principal prepayment on the Certificates
resulting from the application of unused moneys in the Pre-Funding
Account;
(xxi) the Net Swap Payment or Net Swap Receipt, as applicable, or
any Defaulted Swap Termination Payment, if any, for such Distribution
Date; and
(xxii) any Interest Rate Cap Payments for such Distribution Date.
In addition, each Form 10 D prepared and filed by the Securities Administrator
pursuant to Section 8.12 shall include the following information with respect to
the related distribution (including to the extent such information is provided
by the Trustee to the Securities Administrator):
(i) material breaches of Mortgage Loan representations and warranties
under this Agreement of which the Securities Administrator has actual
knowledge or has received written notice; and
(ii) material breaches of any covenants under this Agreement of which the
Securities Administrator has actual knowledge or received written notice.
(b) The Securities Administrator's responsibility for providing the
above statement to the Certificateholders, each Rating Agency, the Master
Servicer and the Depositor is limited, if applicable, to the availability,
timeliness and accuracy of the information derived from the Servicers, the
Master Servicer and the Swap Provider. The Securities Administrator shall make
available the above statement via the Securities Administrator's internet
website. The Securities Administrator's website will initially be located at
xxxx://xxx.xxxxxxx.xxx and assistance in using the website can be obtained by
calling the Securities Administrator's customer service desk at 1-866-846-4526.
Parties that are unable to use the website are entitled to have a paper copy
mailed to them via first class mail by calling the customer service desk and
indicating such. The Securities Administrator may change the way the monthly
statements to Certificateholders 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. The Securities Administrator will
not be liable for the dissemination of information in accordance with this
Agreement.
The Securities Administrator shall make available to each Analytics
Company, either electronically or via the Securities Administrator's internet
website, each statement to Certificateholders prepared pursuant to Section
4.03(a). The Securities Administrator (and the applicable Servicer, if such
discrepancy results from or arises out of any information provided by the
applicable Servicer pursuant to this Agreement) shall cooperate in good faith
with the Depositor to reconcile any discrepancies in such statements, and the
Securities Administrator shall provide any corrections to such statements to
each Analytics Company as soon as reasonably practicable after the related
Distribution Date.
The Securities Administrator will also be entitled to rely on but
shall not be responsible for the content or accuracy of any information provided
by third parties for purposes of preparing the monthly statement to
Certificateholders and may affix thereto any disclaimer it deems appropriate in
its reasonable discretion (without suggesting liability on the part of any other
party hereto).
(c) Within a reasonable period of time after the end of each
calendar year, the Securities Administrator shall cause to be made available 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 4.03 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 have been previously provided by
the Securities Administrator.
Not later than the 18th day of each month (or if such day is a
Saturday, the prior Business Day and if such day is a Sunday or otherwise not a
Business Day, prior to, the following Business Day), the Servicer shall furnish
to Depositor with respect to clause (i) below and the Master Servicer and the
Swap Provider with respect to clause (ii) below, a monthly remittance advice
statement (the "Servicer Remittance Report") containing the fields set forth on
Exhibit V hereto, or in a format mutually agreed upon by the parties and a
monthly defaulted loan report containing the data fields set forth on Exhibit W
hereto, or in a format mutually agreed upon by the parties and in the case of
both Exhibit V and Exhibit W, containing such information as shall be reasonably
requested (i) by the Depositor to enable the Depositor to disclose "static pool
information", as required by Item 1105 of Regulation AB, with respect to the
Mortgage Loans, and (ii) by the Securities Administrator to enable the
Securities Administrator to provide the reports required by Section 4.03(a) as
to the accompanying remittance and the period ending on the close of business on
the last day of the preceding month. The Servicer shall deliver to the Depositor
a data tape containing a supplemental report of principal prepayment made during
such period, in form and substance reasonably satisfactory to the Depositor,
containing the information required pursuant to this Section 4.03(d) on a
loan-by-loan basis for all of the Mortgage Loans.
Not later than the 18th day of each month (or if such day is a
Saturday, the prior Business Day and if such day is a Sunday or otherwise not a
Business Day, prior to, the following Business Day), the Servicer shall furnish,
subject to the terms of the confidentiality agreement between the Servicer and
the Unaffiliated Seller, the Unaffiliated Seller, an individual loan accounting
report, which may be the same as the Servicer Remittance Report described in the
previous paragraph, as of the Determination Date of each month to document
Mortgage Loan payment activity on an individual Mortgage Loan basis. The
corresponding individual loan accounting report (in electronic format) shall
contain the following:
(i) with respect to each Scheduled Payment, the amount of such
remittance allocable to principal (including a separate breakdown of any
Principal Prepayment);
(ii) with respect to each Scheduled Payment, the amount of such
remittance allocable to interest and assumption fees;
(iii) the amount of servicing compensation received by the Servicer
during the related distribution period;
(iv) the individual and aggregate Stated Principal Balance of the
Mortgage Loans;
(v) the individual and aggregate Scheduled Principal Balances of the
Mortgage Loans;
(vi) the aggregate of any expenses reimbursed to the Servicer during
the prior distribution period pursuant to Section 3.05 and 3.11;
(vii) the number and aggregate Scheduled Principal Balances of
Mortgage Loans (a) as to which the Scheduled Payment is Delinquent (1) 31
to 60 days, (2) 61 to 90 days and (3) 91 days or more; (b) as to which
foreclosure has commenced; (c) as to which REO Property has been acquired
and (d) that are in bankruptcy.
Concurrently with each delivery of a Servicer Remittance Report to
the Master Servicer, Xxxxx Fargo shall provide, in a manner consistent with the
preceding paragraph, a supplemental statement (to the extent not previously
provided) setting forth information in subclauses (vi) and (vii) of the
preceding paragraph.
(d) For all purposes of this Agreement, with respect to any Mortgage
Loan, delinquencies shall be determined by the Securities Administrator from
information provided by the Servicers and reported by the Securities
Administrator based on the "OTS" methodology for determining delinquencies on
mortgage loans similar to the Mortgage Loans. By way of example, a Mortgage Loan
would be delinquent with respect to a Scheduled Payment due on a Due Date if
such Scheduled Payment is not made by the close of business on the Mortgage
Loan's next succeeding Due Date, and a Mortgage Loan would be more than 30-days
Delinquent with respect to such Scheduled Payment if such Scheduled Payment were
not made by the close of business on the Mortgage Loan's second succeeding Due
Date. Each Servicer, other than Xxxxx Fargo, hereby represents and warrants to
the Depositor that such Servicer is not subject to any delinquency recognition
policy established by the primary safety and soundness regulator, if any, of
such Servicer, that is more restrictive than the foregoing delinquency
recognition policy. Xxxxx Fargo hereby represents and warrants to the Depositor
that Xxxxx Fargo is not subject to any delinquency recognition policy
established by its safety and soundness regulators.
The Master Servicer shall promptly make available the Servicer
Remittance Report and the related supplemental statement to the Depositor and
the Securities Administrator.
Section 4.04 Certain Matters Relating to the Determination of LIBOR.
LIBOR shall be calculated by the Securities Administrator in accordance with the
definition of LIBOR. Until all of the LIBOR Certificates are paid in full, the
Securities Administrator shall at all times retain at least four Reference Banks
for the purpose of determining LIBOR with respect to each LIBOR Determination
Date. The Securities Administrator, after consultation with the Depositor,
initially shall designate the Reference Banks. Each "Reference Bank" shall be a
leading bank engaged in transactions in Eurodollar deposits in the international
Eurocurrency market, shall not control, be controlled by, or be under common
control with, the Securities Administrator and shall have an established place
of business in London. If any such Reference Bank should be unwilling or unable
to act as such or if the Securities Administrator should terminate a Reference
Bank, the Securities Administrator, after consultation with the Depositor, shall
promptly appoint or cause to be appointed another Reference Bank. The Securities
Administrator shall have no liability or responsibility to any Person for (i)
the selection of any Reference Bank for purposes of determining LIBOR or (ii)
any inability to retain at least four Reference Banks which is caused by
circumstances beyond its reasonable control.
The Pass-Through Rate for each Class of LIBOR Certificates for each
Interest Accrual Period shall be determined by the Securities Administrator on
each LIBOR Determination Date so long as the LIBOR Certificates are Outstanding
on the basis of LIBOR and the respective formulae appearing in footnotes
corresponding to the LIBOR Certificates in the table relating to the
Certificates in the Preliminary Statement. The Securities Administrator shall
not have any liability or responsibility to any Person for its inability,
following a good-faith reasonable effort, to obtain quotations from the
Reference Banks or to determine the arithmetic mean referred to in the
definition of LIBOR, all as provided for in this Section 4.04 and the definition
of LIBOR. The establishment of LIBOR and each Pass-Through Rate for the LIBOR
Certificates by the Securities Administrator shall (in the absence of manifest
error) be final, conclusive and binding upon each Holder of a Certificate and
the Securities Administrator.
Section 4.05 [Reserved].
Section 4.06 [Reserved].
Section 4.07 Allocation of Applied Realized Loss Amounts. Any
Applied Realized Loss Amounts shall be allocated by the Securities Administrator
to the most junior Class of Subordinated Certificates then Outstanding in
reduction of the Class Certificate Balance thereof.
Section 4.08 Swap Account. The Securities Administrator, on behalf
of the Trustee, shall establish and maintain the Swap Account (the "Swap
Account"), on behalf of the Supplemental Interest Trust and the Swap Provider.
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.
On the Business Day immediately preceding each Distribution Date,
Swap Termination Payments (including, without duplication, Replacement Swap
Provider Payments), Net Swap Payments owed to the Swap Provider, Net Swap
Receipts and, without duplication, amounts distributable on the Class UT-PFIO
Interest for that Distribution Date will be deposited into the Swap Account.
Funds in the Swap Account will be distributed in the following order of
priority:
(i) to the Swap Provider, all Net Swap Payments, if any, owed to the
Swap Provider for that Distribution Date;
(ii) to the Swap Provider, any Swap Termination Payment, other than
a Defaulted Swap Termination Payment, owed to the Swap Provider for that
Distribution Date;
(iii) to the Class A Certificates, to pay Accrued Certificate
Interests and, if applicable, any Unpaid Interest Amounts as described in
Section 4.02(a)(i), to the extent unpaid from Available Funds;
(iv) 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 Accrued Certificate Interests and, if
applicable, any Unpaid Interest Amounts as described in Section 4.02(a)(i)
and Section 4.02(a)(iii), to the extent unpaid from Available Funds;
(v) to the LIBOR Certificates, to pay principal as described and, in
the same manner and order of priority as set forth, in Section
4.02(a)(ii)(A) or Section 4.02(a)(ii)(B), as applicable, but only to the
extent necessary to restore the Subordinated Amount to the Specified
Subordinated Amount for prior or current Realized Losses that have not yet
been reimbursed, after giving effect to payments and distributions from
Available Funds;
(vi) to the Class A Certificates, to pay Basis Risk Carry Forward
Amounts and, without duplication, Upper-Tier Carry Forward Amounts, pro
rata, based on their Class Certificate Balances for such Distribution
Date, up to the Swap Payment Allocation for each Class of Class A
Certificates and to the extent unpaid from Available Funds (including
Basis Risk Payments on deposit in the Excess Reserve Fund Account);
(vii) 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, to pay Basis Risk Carry Forward Amounts and, without
duplication, Upper-Tier Carry Forward Amounts, up to the Swap Payment
Allocation for each Class of Class M and Class B Certificates and to the
extent unpaid from Available Funds (including Basis Risk Payments on
deposit in the Excess Reserve Fund Account);
(viii) to the LIBOR Certificates, any remaining unpaid Basis Risk
Carry Forward Amounts, and, without duplication, Upper-Tier Carry Forward
Amounts, pro rata, based on their respective remaining unpaid Basis Risk
Carry Forward Amounts or, without duplication, Upper-Tier Carry Forward
Amounts after the allocation of payments as set forth in clauses (vi) and
(vii) above;
(ix) 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, to pay any Unpaid Realized Loss Amount, to the extent unpaid
from Available Funds;
(x) to the Swap Provider, any remaining Defaulted Swap Termination
Payment owed to the Swap Provider for that Distribution Date; and
(xi) to the holders of the Class X Certificates, any remaining
amounts.
Notwithstanding the foregoing, in the event that the Trust receives
a Swap Termination Payment, the Securities Administrator shall use the Swap
Termination Payment to enter into a replacement interest rate swap agreement as
directed by the Depositor with a successor swap provider (or its guarantor)
meeting the ratings requirements set forth in the Interest Rate Swap Agreement
being terminated on the same remaining terms as those in the Interest Rate Swap
Agreement being terminated, so long as the Swap Termination Payment is
sufficient to obtain such replacement interest rate swap agreement. In the event
that the Trust receives a Swap Termination Payment and a successor swap provider
cannot be obtained, then the Securities Administrator shall deposit the Swap
Termination Payment into the reserve account that is a sub-account of the Swap
Account. On each subsequent Distribution Date (so long as funds are available in
the reserve account), the Securities Administrator shall withdraw from the
reserve account and deposit into the Swap Account an amount equal to the amount
of any Net Swap Receipt due the Trust (calculated in accordance with the terms
of the original Interest Rate Swap Agreement) and treat such amount as a Net
Swap Receipt for purposes of determining the distributions from the Swap
Account. The remaining amount in the reserve account will remain in that account
and will not be treated as a Swap Termination Payment for purposes of
determining the distributions from the Swap Account until the final Distribution
Date. In no event shall the Securities Administrator be responsible for the
selection of any successor or replacement Swap Provider or any shortfalls caused
by a failure to enter into a replacement interest rate swap agreement.
Upon termination of the Trust, any amounts remaining in the Swap
Account shall be distributed pursuant to the priorities set forth in this
Section 4.08.
In the event that, upon the Trust entering into a replacement
interest rate swap agreement, the Trust is entitled to receive a Replacement
Swap Provider Payment from a replacement swap provider, the Securities
Administrator shall direct the replacement swap provider (or its guarantor) to
make such Replacement Swap Provider Payment to the Swap Account. Notwithstanding
the foregoing, any Replacement Swap Provider Payment shall be made from the Swap
Account to the Swap Provider immediately upon receipt of such payment,
regardless of whether the date of receipt thereof is a Distribution Date. To the
extent that any Replacement Swap Provider Payment is made to an account other
than the Swap Account, then, notwithstanding anything to the contrary contained
in this Agreement, any Replacement Swap Provider Payment shall be paid to the
Swap Provider immediately upon receipt of such Replacement Swap Provider Payment
by the Trust, regardless of whether the date of receipt thereof is a
Distribution Date and without regard to anything to the contrary contained in
this Agreement. For the avoidance of doubt, the parties agree that the Swap
Provider shall have first priority to any Replacement Swap Provider Payment over
the payment by the Trust to Certificateholders, the Servicer, the Master
Servicer, the Securities Administrator, the Responsible Party, the Trustee or
any other Person. However, to the extent any Replacement Swap Provider Payment
received from a replacement swap provider and paid to the Swap Provider being
replaced is less than the full amount of a Swap Termination Payment owed to the
Swap Provider, any remaining amount of the Swap Termination Payment shall be
paid to the Swap Provider on subsequent Distribution Dates in accordance with
this Section 4.08 (unless the Replacement Swap Provider Payment is paid to the
Swap Provider on a Distribution Date, in which case such remaining amounts will
be paid on such Distribution Date).
The Securities Administrator shall account for the Swap Account as
an asset of the Grantor Trust and not as an asset of any Trust REMIC created
pursuant to this Agreement. The beneficial owners of the Swap Account are the
Class X Certificateholders. For federal income tax purposes, Net Swap Payments
and Swap Termination Payments (without duplication of previously paid
Replacement Swap Provider Payments) payable to the Swap Provider shall be deemed
to be paid to the Swap Account from the Class X REMIC, first, by the Holder of
the Class X Certificates (in respect of the Class IO Interest and, if
applicable, the Class X and Class PF-IO Interests) and second, other than any
Defaulted Swap Termination Payment, from the Upper-Tier REMIC by the Holders of
the applicable Class or Classes of LIBOR Certificates (in respect of Class IO
Shortfalls) as and to the extent provided in Section 8.13.
Any Basis Risk Carry Forward Amounts and, without duplication,
Upper-Tier Carry Forward Amounts distributed by the Securities Administrator to
the LIBOR Certificateholders shall be accounted for by the Securities
Administrator, for federal income tax purposes, as amounts paid first to the
Holders of the Class X Certificates in respect of the Class X and Class PF-IO
Interests and (to the extent remaining after payments to the Swap Provider) the
Class IO Interest, and then to the respective Class or Classes of LIBOR
Certificates. In addition, the Securities Administrator shall account for the
rights of Holders of each Class of LIBOR Certificates to receive payments of
Basis Risk Carry Forward Amounts and, without duplication, Upper-Tier Carry
Forward Amounts from the Swap Account (along with Basis Risk Carry Forward
Amounts payable from the Excess Reserve Fund Account), subject to the obligation
to pay Class IO Shortfalls, as rights and obligations under a separate limited
recourse notional principal contract between the Class X Certificateholders and
Holders of each such Class.
The Swap Account shall be an "outside reserve fund" for federal
income tax purposes and not an asset of any Trust REMIC. Furthermore, the
Holders of the Class X Certificates shall be the beneficial owners of the Swap
Account for all federal income tax purposes, and shall be taxable on all income
earned thereon.
In the event that the Swap Provider or the Cap Provider is in
default of its obligations under the Interest Rate Swap Agreement or the
Interest Rate Cap Agreement, the Securities Administrator shall send any notices
and make any demands, on behalf of the Trust as are required under the Interest
Rate Swap Agreement or the Interest Rate Cap Agreement. To the extent that the
Swap Provider or Cap Provider fails to make any payment required under the terms
of the Interest Rate Swap Agreement or the Interest Rate Cap Agreement, the
Securities Administrator shall immediately make a demand on the Swap Provider or
the Cap Provider, as applicable, and the Credit Support Provider (as defined in
the Interest Rate Swap Agreement) to make any and all payments then required to
be made by the Credit Support Provider pursuant to such guarantee. In addition,
in the event a "Delivery Amount" (as defined in the Interest Rate Swap
Agreement) payable but not delivered by the Swap Provider as required by the
Interest Rate Swap Agreement, the Securities Administrator shall deliver a
notice of failure to transfer collateral on the next Business Day following such
failure, in accordance with the terms of the Interest Rate Swap Agreement. The
Securities Administrator shall cause any replacement swap provider to provide a
copy of the related replacement interest rate swap agreement to the Securities
Administrator and the Depositor.
If a Responsible Officer of the Securities Administrator receives
written notice that the Swap Provider or its guarantor has been downgraded below
the levels set forth in Part 5(j) of the Interest Rate Swap Agreement and the
posting of collateral is required in accordance with the terms of Part 5(j) of
the Interest Rate Swap Agreement, the Securities Administrator shall demand that
the Swap Provider or its Credit Support Provider post collateral in accordance
with the terms of Part 5(j) of the Interest Rate Swap Agreement.
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates. The Certificates shall be
substantially in the forms attached hereto as exhibits. The Certificates shall
be issuable in registered form, in the minimum denominations, integral multiples
in excess thereof (except that one Certificate in each Class may be issued in a
different amount and aggregate denominations per Class set forth in the
Preliminary Statement).
The Depositor hereby directs the Securities Administrator to
register the Class X Certificates and the Class P Certificates initially to
Xxxxx Fargo Bank, National Association, as indenture trustee on behalf of the
Noteholders of the Natixis Real Estate Capital Inc. NIM 2007-HE2N Notes, and to
deliver such Class X Certificates and Class P Certificates on the Closing Date
to Xxxxx Fargo Bank National Association, or as otherwise directed by the
Depositor.
Subject to Section 11.02 respecting the final distribution on the
Certificates, on each Distribution Date the Securities Administrator shall make
distributions to each Certificateholder of record on the preceding Record Date
(x) by wire transfer in immediately available funds to the account of such
holder at a bank or other entity having appropriate facilities therefor, or (y)
upon the request, in writing, of the applicable Certificateholder, by check
mailed by first class mail to such Certificateholder at the address of such
holder appearing in the Certificate Register.
The Certificates shall be executed by manual or facsimile signature
by an authorized officer of the Securities Administrator and authenticated by
the Securities Administrator by manual or facsimile signature by an authorized
officer. Certificates bearing the manual or facsimile signatures of individuals
who were, at the time such signatures were affixed, authorized to sign on behalf
of the Trustee or Securities Administrator, respectively, shall bind the Trustee
and the Securities Administrator, respectively, notwithstanding that such
individuals or any of them have ceased to be so authorized prior to the
execution, authentication and delivery of any such Certificates or did not hold
such offices at the date of such Certificate. No Certificate shall be entitled
to any benefit under this Agreement, or be valid for any purpose, unless
authenticated by the Securities Administrator by manual signature, and such
authentication upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly executed and delivered hereunder.
All Certificates shall be dated the date of their authentication. On the Closing
Date, the Securities Administrator shall authenticate the Certificates to be
issued at the direction of the Depositor, or any Affiliate thereof.
Section 5.02 Certificate Register; Registration of Transfer and
Exchange of Certificates. (a) The Securities Administrator, on behalf of the
Trustee, shall maintain, or cause to be maintained in accordance with the
provisions of Section 5.06, 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 execute and deliver, in the
name of the designated transferee or transferees, one or more new Certificates
of the same Class and 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 which 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 cancelled and subsequently destroyed by the Securities
Administrator in accordance with the Securities Administrator's customary
procedures.
(b) 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 said Act and such state securities laws. Except
with respect to (i) the transfer of Class X, Class P or Residual Certificates to
the Depositor or an Affiliate of the Depositor or in the case of the Class RX
Certificates, the initial transfer by an Affiliate of the Depositor, (ii) the
transfer of the Class X and Class P Certificates to the NIM Issuer, if any, or
the NIM Trustee, if any, or (iii) a transfer of the Class X or Class P
Certificates from the NIM Issuer, if any, or the NIM Trustee, if any, to the
Depositor, Unaffiliated Seller or an Affiliate of the Depositor or the
Unaffiliated Seller, in the event that a transfer of a Private Certificate which
is a Physical Certificate 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 shall
certify to the Securities Administrator in writing the facts surrounding the
transfer in substantially the form set forth in Exhibit I (the "Transferor
Certificate") and either (i) there shall be delivered to the Securities
Administrator a letter in substantially the form of Exhibit J (the "Rule 144A
Letter") or (ii) there shall be delivered to the Securities Administrator at the
expense of the transferor an Opinion of Counsel that such transfer may be made
without registration under the Securities Act. In the event that a transfer of a
Private Certificate which is a Book-Entry Certificate 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 will be deemed to have made as of the transfer date each
of the certifications set forth in the Transferor Certificate in respect of such
Certificate and the transferee will be deemed to have made as of the transfer
date each of the certifications set forth in the Rule 144A Letter in respect of
such Certificate, in each case as if such Certificate were evidenced by a
Physical Certificate. The Depositor shall, and the Unaffiliated Seller may,
provide to any Holder of a Private Certificate and any prospective transferee
designated by any such Holder, information regarding the related 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, the Master Servicer and the Servicer shall cooperate
with the Depositor and the Unaffiliated Seller 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 and the Unaffiliated
Seller 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 Securities
Administrator, the Depositor, the Servicer, the Master Servicer and the
Unaffiliated Seller 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.
Except with respect to (i) the transfer of Class X, Class P or
Residual Certificates to the Depositor or an Affiliate of the Depositor or the
Unaffiliated Seller or an Affiliate of the Unaffiliated Seller, (ii) a transfer
of the Class X and Class P Certificates to the NIM Issuer, if any, or the NIM
Trustee, if any, or (iii) a transfer of the Class X or Class P Certificates from
the NIM Issuer, if any, or the NIM Trustee, if any, to the Depositor,
Unaffiliated Seller or an Affiliate of the Depositor or the Unaffiliated Seller,
no transfer of an ERISA-Restricted Certificate shall be made unless the
Securities Administrator shall have received a representation letter from the
transferee in substantially the form of Exhibit J, to the effect that either (A)
such transferee is not an employee benefit plan or arrangement subject to Title
I of ERISA, Section 4975 of the Code or any Federal, state or local law
("Similar Law") materially similar to the foregoing provisions of ERISA or the
Code (each, a "Plan"), and is not acting on behalf of any Plan or using the
assets of any Plan to effect such transfer or (B) with respect to the transfer
of an ERISA-Restricted Certificate that is not a Class P, Class X, Class R or
Class RX Certificate, such transferee is an insurance company that is purchasing
the Certificate with funds contained in an "insurance company general account"
(as such term is defined in Section V(e) of Prohibited Transaction Class
Exemption 95-60 ("PTCE 95-60")) and the conditions for exemptive relief under
Sections I and III of PTCE 95-60 are satisfied with respect to the purchase and
holding of such Certificate. For purposes of the preceding sentence, with
respect to (i) the transfer of an ERISA-Restricted Certificate that is not a
Physical Certificate and (ii) the transfer of the Class X or Class P
Certificates from the NIM Issuer, if any, or the NIM Trustee, if any, to an
Affiliate of the Depositor or Unaffiliated Seller, in the event the
representation letter referred to in the preceding sentence is not furnished,
such representation shall be deemed to have been made to the Securities
Administrator by the transferee's (including an initial acquiror's) acceptance
of the ERISA-Restricted Certificate. In the event that such representation is
violated, such attempted transfer or acquisition shall be void and of no effect.
Each purchaser or transferee of an Offered Certificate that is a
Plan, or that is acting on behalf of a Plan or using the assets of a Plan to
acquire such Offered Certificate, shall be deemed to represent that it qualifies
as an accredited investor as defined in Rule 501(a)(1) of Regulation D of the
Securities and Exchange Commission under the Securities Act and, for so long as
either of the Interest Rate Swap Agreement or the Interest Rate Cap Agreement is
in effect, its acquisition and holding of an interest in the Supplemental
Interest Trust will be eligible for the exemptive relief available under either
an Investor Based Exemption or the statutory exemption under Section 408(b)(17)
of ERISA and Section 4975(d)(20) of the Code.
To the extent permitted under applicable law (including, but not
limited to, ERISA), the Securities Administrator shall be under no liability to
any Person for any registration of transfer of any ERISA-Restricted Certificate
that is in fact not permitted by this Section 5.02(b) 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 by the Securities Administrator in accordance with the
foregoing requirements.
(c) 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) Other than in the case of the Depositor or an Affiliate of the
Depositor, 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 subparagraph (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 H;
(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 (i) is a
Non-Permitted Transferee;
(iv) Any attempted or purported Transfer of any Ownership Interest
in a Residual Certificate in violation of the provisions of Section
5.02(b) and this Section 5.02(c) 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 Section 5.02(b) and this Section 5.02(c), 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. The Securities Administrator shall be under no
liability to any Person for any registration of Transfer of a Residual
Certificate that is in fact not permitted by Section 5.02(b) and this
Section 5.02(c) 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, Transferor
Certificate and the Rule 144A Letter. The Securities Administrator shall
be entitled but not obligated to recover from any Holder of a Residual
Certificate that was in fact a Non-Permitted Transferee at the time it
became a Holder or, at such subsequent time as it became a Non-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; and
(v) The Depositor shall use its best efforts to make available, upon
receipt 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 a Non-Permitted Transferee.
The restrictions on Transfers of a Residual Certificate set forth in
this Section 5.02(c) 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, which Opinion of Counsel shall not be an expense of the Trust Fund, the
Trustee, the Securities Administrator, the Unaffiliated Seller or the Servicer,
to the effect that the elimination of such restrictions will not cause the
transfer to be disregarded under Treasury regulations section 1.860E-1(c), cause
any REMIC created hereunder 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 which, based on an Opinion of Counsel 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 a Non-Permitted
Transferee and (b) to provide for a means to compel the Transfer of a Residual
Certificate which is held by a Person that is a Non-Permitted Transferee to a
Holder that is a Permitted Transferee.
(d) The preparation and delivery of all certificates and opinions
referred to above in this Section 5.02 in connection with transfer shall be at
the expense of the parties to such transfers.
(e) Except as provided below, the Book-Entry Certificates shall at
all times remain registered in the name of the Depository or its nominee and at
all times: (i) registration of the Certificates may not be transferred by the
Securities Administrator except to another Depository; (ii) the Depository shall
maintain book-entry records with respect to the Certificate Owners and with
respect to ownership and transfers of such Book-Entry Certificates; (iii)
ownership and transfers of registration of the Book-Entry Certificates on the
books of the Depository shall be governed by applicable rules established by the
Depository; (iv) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (v) the Securities
Administrator shall deal with the Depository, Depository Participants and
indirect participating firms as representatives of the Certificate Owners of the
Book-Entry Certificates for purposes of exercising the rights of Holders under
this Agreement, and requests and directions for and votes of such
representatives shall not be deemed to be inconsistent if they are made with
respect to different Certificate Owners; and (vi) 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 furnished by the
Depository Participants with respect to indirect participating firms and persons
shown on the books of such indirect participating firms as direct or indirect
Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. 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.
If (x) (i) the Depository or the Depositor advises the Securities
Administrator in writing that the Depository is no longer willing or able to
properly discharge its responsibilities as Depository, and (ii) the Securities
Administrator or the Depositor is unable to locate a qualified successor or (y)
after the occurrence of an Event of Default, Certificate Owners representing at
least a majority of the Certificate Balance of the Book-Entry Certificates
together advise the Securities Administrator and the Depository through the
Depository Participants in writing that the continuation of a book-entry system
through the Depository is no longer in the best interests of the Certificate
Owners, the Securities Administrator shall notify all Certificate Owners,
through the Depository, of the occurrence of any such event and of the
availability of definitive, fully-registered Certificates (the "Definitive
Certificates") to Certificate Owners requesting the same. Upon surrender to the
Securities Administrator of the related Class of Certificates by the Depository,
accompanied by the instructions from the Depository for registration, the
Securities Administrator shall issue the Definitive Certificates. None of the
Servicer, the Depositor, the Securities Administrator nor the Trustee shall be
liable for any delay in delivery of such instruction and each may conclusively
rely on, and shall be protected in relying on, such instructions. The Depositor
shall provide the Securities Administrator with an adequate inventory of
Certificates to facilitate the issuance and transfer of Definitive Certificates.
Upon the issuance of Definitive Certificates all references herein to
obligations imposed upon or to be performed by the Depository shall be deemed to
be imposed upon and performed by the Securities Administrator, to the extent
applicable with respect to such Definitive Certificates and the Securities
Administrator shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder; provided, that the Securities Administrator shall
not by virtue of its assumption of such obligations become liable to any party
for any act or failure to act of the Depository.
(f) Each Private Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer and accompanied by IRS Form W-8ECI, W-8BEN, W-8IMY (and
all appropriate attachments) or W-9 in form satisfactory to the Securities
Administrator, duly executed by the Certificateholder or his attorney duly
authorized in writing. Each Certificate presented or surrendered for
registration of transfer or exchange shall be canceled and subsequently disposed
of by the Securities Administrator in accordance with its customary practice. No
service charge shall be made for any registration of transfer or exchange of
Private Certificates, but the Securities Administrator may require payment of a
sum sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Private Certificates.
Section 5.03 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 (b) there is delivered to the
Depositor, the Servicer, the Securities Administrator and the Trustee such
security or indemnity as may be required by them to hold each of them 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 5.03, 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 and
its counsel) connected therewith. Any replacement Certificate issued pursuant to
this Section 5.03 shall constitute complete and indefeasible evidence of
ownership, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
Section 5.04 Persons Deemed Owners. The Servicer, the Trustee, the
Securities Administrator, the Master Servicer and the Depositor and any agent of
the Servicer, the Depositor, the Securities Administrator, the Master Servicer
or 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 none of
the Servicer, the Trustee, the Securities Administrator, the Master Servicer and
the Depositor nor any agent of the Servicer, the Depositor, the Securities
Administrator, the Master Servicer or the Trustee shall be affected by any
notice to the contrary.
Section 5.05 Access to List of Certificateholders' Names and
Addresses. If three or more Certificateholders (a) request in writing such
information from the Securities Administrator, (b) state that such
Certificateholders desire to communicate with other Certificateholders with
respect to their rights under this Agreement or under the Certificates, and (c)
provide a copy of the communication which such Certificateholders propose to
transmit, or if the Depositor or the 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 Servicer or such Certificateholders at such recipients' expense
the most recent list of the Certificateholders of such Trust Fund held by the
Securities Administrator, if any. The Depositor and every Certificateholder, 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 5.06 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 in Minnesota where Certificates may be
surrendered for registration of transfer or exchange. The Securities
Administrator initially designates its office for such purposes located at Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, XX 00000. The Securities Administrator
shall give prompt written notice to the Certificateholders of any change in such
location of any such office or agency.
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
Section 6.01 Respective Liabilities of the Depositor and the
Servicer. The Depositor and the Servicer shall each be liable in accordance
herewith only to the extent of the obligations specifically and respectively
imposed upon and undertaken by them herein.
Section 6.02 Merger or Consolidation of the Depositor or the
Servicer. The Depositor and the Servicer will each keep in full effect its
existence, rights and franchises as a corporation or limited partnership, as the
case may be, under the laws of the United States or under the laws of one of the
states thereof and will each 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 respective duties under this Agreement.
Any Person into which the Depositor or a Servicer may be merged or
consolidated, or any Person resulting from any merger or consolidation to which
the Depositor or a Servicer, shall be a party, or any person succeeding to the
business of the Depositor or a Servicer (including through the acquisition of
substantially all of the assets of a Servicer), shall be the successor of the
Depositor or such Servicer, as the case may be, 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 (except that any person
succeeding to the business of a Servicer shall be required to assume all of such
Servicer's future obligations under this Agreement and satisfy all of the
requirements of this Agreement to be a successor servicer); provided, however,
that the successor or surviving Person to such Servicer shall be qualified to
service mortgage loans on behalf of, Xxxxxx Xxx or Xxxxxxx Mac. As a condition
to the succession to any Servicer under this Agreement by any Person (i) into
which a Servicer may be merged or consolidated or whom succeeds to the business
of a Servicer, or (ii) which may be appointed as a successor to a Servicer, such
Servicer shall provide to the Depositor, at least 15 calendar days prior to the
effective date of such succession or appointment, (x) written notice to the
Depositor of such succession or appointment and (y) in writing to the Depositor
and in form and substance reasonably satisfactory to the Depositor and the
Master Servicer, all information reasonably necessary to enable the Securities
Administrator, pursuant to Section 8.12(g), to accurately and timely report the
event under Item 6.02 of Form 8-K pursuant to the Exchange Act (if such reports
under the Exchange Act are then required to be filed under the Exchange Act).
The Depositor shall forward to the Master Servicer promptly upon receipt thereof
copies of any notices received by it pursuant to Section 6.02(b)(ii).
Section 6.03 Limitation on Liability of the Depositor, the Servicer
and Others. None of the Depositor, the Servicer, the Custodian, the Securities
Administrator, the Trustee, the Master Servicer nor any of their respective
directors, officers, employees or agents shall be under any liability to the
Certificateholders for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor, the
Servicer, the Custodian, the Securities Administrator, the Trustee, the Master
Servicer or any such Person against any breach of representations or warranties
made by it herein or protect the Depositor, the Servicer, the Custodian, the
Securities Administrator, the Trustee, the Master Servicer or any such Person
from any liability which would otherwise be imposed by reasons of willful
misfeasance, bad faith or negligence (or with respect to the Depositor, gross
negligence) in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. The Depositor and any director, officer,
employee or agent of the Depositor may rely in good faith on any document of any
kind prima facie properly executed and submitted by any Person respecting any
matters arising hereunder. The Depositor, the Servicer, the Custodian, the
Securities Administrator, the Trustee, the Master Servicer and any director,
officer, employee or agent of the Depositor, the Servicer, the Custodian, the
Securities Administrator, the Master Servicer or the Trustee shall be
indemnified by the Trust Fund and held harmless against any loss, liability or
expense incurred in connection with any audit, controversy or judicial
proceeding relating to a governmental taxing authority or any legal action and,
in the case of the Trustee, the Master Servicer and the Securities
Administrator, other matters (other than standard administrative expenses
incurred in its role as Securities Administrator) relating to this Agreement or
the Certificates (including, as to the Trustee and the Securities Administrator,
the undertaking of actions as directed by the Unaffiliated Seller pursuant to
Section 2.03), other than any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence (or with respect to the Depositor,
gross negligence) in the performance of their respective duties hereunder or by
reason of reckless disregard of their respective obligations and duties
hereunder. The Depositor shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its respective
duties hereunder and which in its opinion may involve it in any expense or
liability; provided, however, that the Depositor may in its discretion undertake
any such action (or direct the Securities Administrator to undertake any such
actions pursuant to Section 2.03 hereof for the benefit of the
Certificateholders) that it may deem necessary or desirable in respect of this
Agreement and the rights and duties of the parties hereto and interests of the
Securities Administrator and the Certificateholders hereunder. In such event,
the legal expenses and costs of such action and any liability resulting
therefrom shall be expenses, costs and liabilities of the Trust Fund, and the
Depositor shall be entitled to be reimbursed therefor out of the Collection
Account.
Neither the Servicer nor any of the officers, employees or agents of
the Servicer shall be under any liability to the Trustee, the Custodian, the
Securities Administrator, the Master Servicer or the Depositor for any action
taken or for refraining from the taking of any action in good faith pursuant to
this Agreement; 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 its obligations in compliance with the terms
of this Agreement, or any liability which would otherwise be imposed by reason
of any breach of the terms and conditions of this Agreement. The Servicer and
any officer, employee or agent of the Servicer may rely in good faith on any
document of any kind prima facie properly executed and submitted by any Person
respecting any matters arising hereunder. The Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Mortgage Loans in accordance with this
Agreement and which in its opinion may involve it in any expenses or liability;
provided, however, that the Servicer may undertake any such action which it may
deem necessary or desirable in respect to this Agreement and the rights and
duties of the parties hereto. In such event, the legal expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Trust Fund, and the Servicer shall be entitled to be
reimbursed therefor out of its Collection Account. In the event the Servicer
agrees, at the request of the Depositor, to act on behalf of the Depositor in
any litigation relating to the origination of a Mortgage Loan, the Depositor
shall pay all expenses associated with the defense and management of such claim
(without reimbursement from the Trust Fund).
Section 6.04 Limitation on Resignation of the Servicer. The Servicer
shall not assign this Agreement or resign from the obligations and duties hereby
imposed on it except by mutual consent of the Servicer, the Securities
Administrator, the Master Servicer, the Depositor and the Trustee (and written
notice to the Custodian) 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 Depositor and the Securities Administrator which Opinion of Counsel shall be
in form and substance acceptable to the Depositor and the Securities
Administrator. No such resignation shall become effective until a successor
shall have assumed the Servicer's responsibilities and obligations hereunder.
Notwithstanding anything to the contrary herein, the Servicer may pledge or
assign as collateral all its rights, title and interest under this Agreement to
a lender (the "Lender"); provided that the Lender may only terminate the
Servicer under this Agreement if there has been an Event of Default under this
Agreement, in which event the Lender may replace the Servicer in the same manner
and subject to the same conditions applicable in the event the Servicer is
appointing a successor Servicer upon a servicer termination pursuant to Section
7.02.
Notwithstanding the provisions of Section 6.04 herein to the
contrary, in the event that the Servicer determines that it will no longer
engage in the business of servicing mortgage loans, the Servicer may assign its
rights under this Agreement, provided that, (i) the Depositor in its sole
discretion has consented, which consent shall not be unreasonably withheld, (ii)
the Rating Agencies' ratings of the Certificates in effect immediately prior to
such action will not be qualified, reduced or withdrawn as a result thereof (as
evidenced by a letter to such effect from the Rating Agencies) and (iii) the
Servicer shall be liable for all costs and expenses associated with the transfer
of servicing, provided further, that the Servicer shall indemnify and hold each
of the Trust Fund, the Master Servicer, the Trustee, the Custodian, the
Depositor, any sub servicer, the successor Servicer and each Certificateholder
harmless against any and all claims, losses, penalties, fines, forfeitures,
reasonable legal fees and related costs, judgments, and any other costs, fees
and expenses that such party may sustain in any way related to such assignment
except with respect to a successor Servicer's failure to comply with the terms
of this Agreement. No assignment by the Servicer shall become effective until a
successor Servicer acceptable to the Depositor and the Master Servicer shall
have assumed in writing the Servicer's responsibilities, duties, liabilities
(other than those liabilities arising prior to the appointment of such
successor) and obligations under this Agreement. Any such assignment shall not
relieve the Servicer of responsibility for any of the obligations specified
herein except to the extent that such responsibilities have been expressly
assumed by the successor Servicer.
Section 6.05 Additional Indemnification by the Servicer; Third Party
Claims. (a) The Servicer shall indemnify the Depositor (and its Affiliate,
Xxxxxx Xxxxxxx Mortgage Capital Inc.), the Unaffiliated Seller, the Custodian,
the Securities Administrator, the Master Servicer and the Trustee and any
director, officer, employee, or agent of the Depositor (or its Affiliate, Xxxxxx
Xxxxxxx Mortgage Capital Inc.), the Unaffiliated Seller, the Custodian, the
Securities Administrator, the Master Servicer and the Trustee and hold them
harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments,
and any other costs, fees and expenses that any of them may sustain in any way
related to any breach by the Servicer, of any of its representations and
warranties referred to in Section 2.03(a)(i) or the failure of the Servicer to
perform its duties and service the Mortgage Loans in compliance with the terms
of this Agreement (including without limitation, the failure to deliver accurate
and complete information on a timely basis pursuant to Section 4.03(d)). The
Servicer shall indemnify the Unaffiliated Seller and any director, officer,
employee, or agent of the Unaffiliated Seller and the Trust Fund and hold it
harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments,
and any other costs, fees and expenses that it may sustain in any way related to
any breach by the Servicer, of any of its representations and warranties
referred to in Section 2.03(a)(ii). The Servicer immediately shall notify the
Depositor, the Unaffiliated Seller, the Custodian, the Securities Administrator,
the Master Servicer and the Trustee if a claim is made by a third party with
respect to any such breach or failure by the Servicer under this Agreement,
assume (with the prior written consent of the Depositor, the Unaffiliated
Seller, the Custodian, the Securities Administrator, the Master Servicer and the
Trustee, as applicable) the defense of any such claim and pay all expenses in
connection therewith, including reasonable counsel fees, and promptly pay,
discharge and satisfy any judgment or decree which may be entered against it or
the Depositor, the Unaffiliated Seller, the Custodian, the Securities
Administrator, the Master Servicer or the Trustee in respect of such claim;
provided, that if it is determined that the Servicer is not obligated to
indemnify such parties in accordance with this Section 6.05, each such party (or
the Trust Fund, if applicable) shall promptly reimburse the Servicer in
connection with each of the foregoing payments made to such party by the
Servicer. This indemnity shall survive the termination of this Agreement or the
earlier resignation or removal of the Servicer.
(b) Notwithstanding anything to the contrary contained in this
Agreement, the Servicer shall indemnify the Depositor (and its Affiliate Xxxxxx
Xxxxxxx Mortgage Capital Inc.), the Unaffiliated Seller, the Custodian, the
Trustee, the Securities Administrator, the Master Servicer and any director,
officer, employee or agent of the Depositor (and its Affiliate Xxxxxx Xxxxxxx
Mortgage Capital Inc.), the Unaffiliated Seller, the Custodian, the Trustee, the
Securities Administrator and the Master Servicer and hold them harmless against
any and all claims, losses, damages, penalties, fines, forfeitures, reasonable
and necessary legal fees and related costs, judgments, and any other costs, fees
and expenses that any of them may sustain in any way related to any failure by
the Servicer or any Subservicer engaged by the Servicer or any Subcontractor
utilized by the Servicer to deliver any information, report, certification or
accountants' letter when and as required under Sections 3.22, 3.23, 6.02 or
8.12, including without limitation any failure by the Servicer to identify
pursuant to Section 3.02(e) any Subcontractor "participating in the servicing
function" within the meaning of Item 1122 of Regulation AB.
(c) If the indemnification provided for in this Section 6.05 is
unavailable or insufficient to hold harmless any Person entitled to
indemnification thereunder, then the Servicer shall contribute to the amount
paid or payable by the Person entitled to indemnification as a result of the
losses, claims, damages or liabilities of such Person in such proportion as is
appropriate to reflect the relative fault of such Person on the one hand and the
Servicer, on the other, in connection with the Servicer's obligations pursuant
to this Section 6.05. This Section 6.05 shall survive the termination of this
Agreement or the earlier resignation or removal of the Servicer.
ARTICLE VII
DEFAULT
Section 7.01 Events of Default. "Event of Default," wherever used
herein, means with respect to the Servicer individually, any one of the
following events:
(a) any failure by the Servicer to remit to the Securities
Administrator or the Master Servicer any payment required to be made under the
terms of this Agreement which continues unremedied for a period of one Business
Day after the date upon which written notice of such failure, requiring the same
to be remedied, shall have been given to the Servicer by the Depositor, by the
Securities Administrator, by the Master Servicer or by the Trustee or to the
Servicer, the Trustee, the Depositor, the Securities Administrator or the Master
Servicer by Certificateholders entitled to at least 25% of the Voting Rights in
the Certificates; or
(b) failure on the part of the Servicer to duly observe or perform
in any material respect any other of the covenants or agreements on the part of
the Servicer set forth in this Agreement which continues unremedied for a period
of forty-five days (except that (x) 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 (y) such number of days shall be ten in the
case of a failure to observe or perform any of the obligations set forth in
Sections 3.02, 3.22, 3.23, 6.02 or 8.12 (provided that with respect to Sections
3.22, 3.23 and 8.12, the number of days shall in no case result in the
Servicer's delivery of the required documents thereunder to be delivered after
March 15 of each year)) after the earlier of (i) the date on which written
notice of such failure, requiring the same to be remedied, shall have been given
to the Servicer by the Depositor, by the Securities Administrator, the Master
Servicer or by the Trustee, or to the Master Servicer by Certificateholders
entitled to at least 25% of the Voting Rights in the Certificates and (ii)
actual knowledge of such failure by a Servicing Officer of the Servicer; or
(c) a decree or order of a court or agency or supervisory authority
having jurisdiction for the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshalling 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
(d) the Servicer 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 Servicer or of or relating to all or substantially all of its property; or
(e) the Servicer shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations; or
(f) Fitch reduces its servicer rating of the Servicer to "RPS2-" or
lower, Moody's reduces its servicer rating of the Servicer to "SQ3" or lower, or
Standard & Poor's reduces its servicer rating of the Servicer to "Average" or
lower; or
(g) any failure of the Servicer to make any P&I Advance on any
Remittance Date required to be made from its own funds pursuant to Section 4.01
which continues unremedied for one Business Day immediately following the
Remittance Date; or
(h) a breach of any representation and warranty of the Servicer
referred to in Section 2.03(a), which materially and adversely affects the
interests of the Certificateholders and which continues unremedied for a period
of thirty days after the earlier of (i) the date upon which written notice of
such breach is given to the Servicer by the Trustee, by the Securities
Administrator, by the Master Servicer or by the Depositor, or to the Servicer,
the Depositor, the Master Servicer, the Securities Administrator and the Trustee
by any Certificateholders entitled to at least 25% of the Voting Rights in the
Certificates and (ii) actual knowledge of such breach by a Servicing Officer of
the Servicer; or
(i) any reduction, withdrawal or qualification of the Servicer's
servicer rating by any Rating Agency which results in the Servicer being deemed
unacceptable by any Rating Agency to act as a primary servicer for this
transaction or a primary servicer or a special servicer for any other
mortgage-backed or asset-backed transaction rated or to be rated by any such
Rating Agency; or
(j) the occurrence of a Servicing Trigger Event.
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 Master
Servicer may, or at the direction of Holders holding a majority of the Voting
Rights, the Master Servicer shall, by notice in writing to the Servicer (with a
copy to each Rating Agency), terminate all of the rights and obligations of the
Servicer under this Agreement and in and to the Mortgage Loans and the proceeds
thereof, other than its rights as a Certificateholder hereunder; provided,
however, that the Master Servicer shall not be required to give written notice
to the Servicer of the occurrence of an Event of Default described in clauses
(b) through (i) of this Section 7.01 unless and until a Responsible Officer of
the Master Servicer has actual knowledge of the occurrence of such an Event of
Default. In the event that a Responsible Officer of the Master Servicer has
actual knowledge of the occurrence of an event of default described in clause
(a) of this Section 7.01, the Master Servicer shall give written notice to the
Servicer and the Unaffiliated Seller of the occurrence of such an event within
one Business Day of the first day on which such Responsible Officer obtains
actual knowledge of such occurrence; provided, however, that the failure of the
Master Servicer to provide such notice within one Business Day will not affect
the rights of the Depositor or the Certificateholders to provide notice as
required pursuant to clause (a) of this Section 7.01. On and after the receipt
by the Servicer of such written notice, all authority and power of the Servicer
hereunder, whether with respect to the Mortgage Loans serviced by the Servicer
or otherwise, shall pass to and be vested the Master Servicer within a period of
time not to exceed 90 days. If an Event of Default described in clause (g) shall
occur, and shall not have been cured at least two (2) Business Days, prior to
the related Distribution Date, the Master Servicer shall, prior to the related
Distribution Date, immediately terminate the rights and obligations of the
Servicer hereunder and the Master Servicer, as the case may be, shall succeed to
the rights and obligations of the Servicer hereunder pursuant to Section 7.02,
including the obligation to immediately make any P&I Advances, which the
Servicer failed to make subject to Section 4.01 pursuant to the terms hereof
prior to such Distribution Date. Any costs related to the transfer of servicing
from the Servicer to the Master Servicer shall be reimbursable by the Trust
Fund. The Master Servicer is hereby authorized and empowered to execute and
deliver, on behalf of the Servicer, 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
the Mortgage Loans and related documents, or otherwise. Unless expressly
provided in such written notice, no such termination shall affect any obligation
of the Servicer to pay amounts owed pursuant to Article VIII. The Servicer
agrees to cooperate with the Master Servicer in effecting the termination of the
Servicer's responsibilities and rights hereunder, including, without limitation,
the transfer to the Master Servicer, as applicable, of all cash amounts which
shall at the time be credited to the Collection Account of such predecessor
Servicer, or thereafter be received with respect to the Mortgage Loans serviced
by such predecessor Servicer.
Notwithstanding any termination of the activities of the Servicer
hereunder, the Servicer shall be entitled to receive, out of any late collection
of a Scheduled Payment on a Mortgage Loan which was due prior to the notice
terminating the Servicer's rights and obligations as the Servicer hereunder and
received after such notice, that portion thereof to which the Servicer would
have been entitled pursuant to Section 3.11, and any other amounts payable to
the Servicer hereunder the entitlement to which arose prior to the termination
of its activities hereunder in accordance with Section 3.11 and in the time
period specified in Section 3.11. The Servicer shall continue to be entitled to
the benefits of Section 6.03, notwithstanding any termination hereunder, with
respect to events occurring prior to such termination.
Section 7.02 Master Servicer to Act; Appointment of Successor. On
and after the time the Servicer receives a notice of termination pursuant to
Section 3.24 or Section 7.01, subject to the third paragraph of this Section
7.02, the Master Servicer shall, subject to and to the extent provided in
Section 3.24, be the successor to the Servicer in its capacity as servicer under
this Agreement and the transactions set forth or provided for herein and shall
be subject to all the responsibilities, duties and liabilities relating thereto
placed on the Servicer by the terms and provisions hereof and applicable law
including the obligation to make P&I Advances and Servicing Advances pursuant to
Section 4.01. As compensation therefor, the Master Servicer shall be entitled to
all funds relating to the Mortgage Loans that the Servicer would have been
entitled to charge to the Collection Account or the Distribution Account if the
Servicer had continued to act hereunder including, if the Servicer was receiving
the Servicing Fee, the Servicing Fee and the income on investments or gain
related to the Collection Account and the Distribution Account. The predecessor
Servicer shall pay all costs and expenses incurred in connection with a transfer
of servicing in the event of termination of the Servicer for cause to a
successor Servicer. In the event the full costs associated with the transition
of servicing responsibilities to the Master Servicer are not paid by the
predecessor Servicer, such costs shall be paid by the Trust.
Notwithstanding the foregoing, if the Master Servicer has become the
successor to the Servicer in accordance with Section 7.01, the Master Servicer,
as applicable, may, if it shall be unwilling to so act, or shall, if it is
prohibited by applicable law from making P&I Advances and Servicing Advances
pursuant to Section 4.01, if it is otherwise unable to so act, or at the
direction of Holders holding a majority of the Voting Rights, 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 Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Servicer hereunder. Any successor
to the Servicer shall be an institution which is a Xxxxxx Mae and Xxxxxxx Mac
approved seller/servicer in good standing, which is willing to service the
Mortgage Loans and which executes and delivers to the Depositor and the Trustee
an agreement accepting such delegation and assignment, containing an assumption
by such Person of the rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer (other than liabilities of the Servicer under
Section 6.03 incurred prior to termination of the Servicer under Section 7.01),
with like effect as if originally named as a party to this Agreement; provided
that each Rating Agency acknowledges 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. Pending appointment
of a successor to the Servicer hereunder, the Master Servicer, unless the Master
Servicer is prohibited by law from so acting, shall, subject to Section 3.05,
act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the Master Servicer may make such arrangements for
the compensation of such successor out of payments on Mortgage Loans serviced by
such predecessor Servicer as it and such successor shall agree; provided,
however, that no such compensation shall be in excess of the Servicing Fee Rate
and amounts paid to the predecessor Servicer from investments. The Master
Servicer and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. Neither the
Master Servicer nor any other successor 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 predecessor Servicer to deliver or provide, or any
delay in delivering or providing, any cash, information, documents or records to
it. If no successor Servicer meeting such qualifications shall have been
approved by the Depositor within 30 days after the giving of such notice or
resignation, the Master Servicer may petition any court of competent
jurisdiction for the appointment of a successor Servicer meeting the
qualifications set forth in Section 7.02.
Notwithstanding any provision in this Agreement to the contrary,
prior to the 20th day following the notice of termination of the Servicer, the
terminated Servicer may appoint a successor Servicer that satisfies the
eligibility criteria of a successor Servicer set forth in this Section 7.02;
provided any successor Servicer hereunder agrees to fully effect the servicing
transfer within 30 days following the termination of the predecessor Servicer
and to make all P&I Advances, Servicing Advances and payments pursuant to
Section 7.01(a) that would otherwise be made by the Servicer under this Section
7.02 as of the date of such appointment and prior thereto, the terminated
Servicer makes all P&I Advances, Servicing Advances and payments pursuant to
Section 7.02; provided, however, that, in the event that such terminated
Servicer does not make such P&I Advances, Servicing Advances or payments under
Section 7.01(a), the provisions of this paragraph shall not apply; otherwise the
Master Servicer shall appoint a successor Servicer as otherwise set forth in
this Section 7.02. Any proceeds received in connection with the appointment of
such successor Servicer shall be the property of the terminated Servicer or its
designee.
Any successor to the Servicer as servicer shall give notice to the
related Mortgagors of such change of servicer and shall, during the term of its
service as servicer, maintain in force the policy or policies that the Servicer
is required to maintain pursuant to Section 3.13.
Section 7.03 Notification to Certificateholders. (a) Upon any
termination of or appointment of a successor to the Servicer, the Securities
Administrator shall give prompt written notice thereof to Certificateholders,
the Unaffiliated Seller, the Swap Provider, the Cap Provider and to each Rating
Agency.
(b) Within 60 days after the occurrence of any Event of Default, the
Securities Administrator shall transmit by mail to all Certificateholders, the
Unaffiliated Seller, the Cap Provider, the Swap Provider and each Rating Agency
notice of each such Event of Default hereunder known to the Securities
Administrator, unless such Event of Default shall have been cured or waived.
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01 Duties of the Trustee. The Trustee, before the
occurrence of a Master Servicer Event of Default and after the curing of Master
Servicer Events of Default that may have occurred, shall undertake to perform
such duties and only such duties as are specifically set forth in this
Agreement. In case a Master Servicer Event of Default has occurred and remains
uncured, the Trustee shall exercise such of the rights and powers vested in it
by this Agreement, and use the same degree of care and skill in their exercise
as a prudent person would exercise or use under the circumstances in the conduct
of such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee that are specifically required to be furnished pursuant to any
provision of this Agreement shall examine them to determine whether they are in
the form required by this Agreement. The Trustee shall not be responsible for
the accuracy or content of any resolution, certificate, statement, opinion,
report, document, order, or other instrument.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct.
Unless a Master Servicer Event of Default of which a Responsible
Officer of the Trustee has actual knowledge or written notice has occurred and
is continuing,
(a) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Agreement, the Trustee shall not be
liable except for the performance of the duties and obligations specifically set
forth in this Agreement, no implied covenants or obligations shall be read into
this Agreement against the Trustee, and the Trustee 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 and
conforming to the requirements of this Agreement which it believed in good faith
to be genuine and to have been duly executed by the proper authorities
respecting any matters arising hereunder;
(b) the Trustee shall not be liable for an error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it is finally proven that the Trustee was negligent in ascertaining the
pertinent facts;
(c) the Trustee shall not be liable with respect to any action
taken, suffered, or omitted to be taken by it in good faith in accordance with
the direction of the Holders of Certificates evidencing not less than 25% of the
Voting Rights of Certificates relating to the time, method, and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee under this Agreement; and
(d) none of the provisions contained in this Agreement shall in any
event require the Trustee to perform, or be responsible for the manner of
performance of, any of the obligations of the Master Servicer under this
Agreement except during such time, if any, as the Trustee shall be the successor
to, and be vested with the rights, duties, powers and privileges of, the Master
Servicer in accordance with the terms of this Agreement.
Section 8.02 Certain Matters Affecting the Trustee and the
Custodian. Except as otherwise provided in Section 8.01:
(a) the Trustee may request and rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officer's Certificate,
certificate 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 and the Trustee shall have no responsibility to
ascertain or confirm the genuineness of any signature of any such party or
parties;
(b) the Trustee may consult with counsel, financial advisers or
accountants and the advice of any such counsel, financial advisers or
accountants and any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such Opinion of Counsel;
(c) the Trustee shall not be liable 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;
(d) the Trustee shall not 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 the Holders of
Certificates evidencing not less than 25% of the Voting Rights allocated to each
Class of Certificates; provided, however, that if the payment within a
reasonable time to the Trustee 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, not assured to the Trustee by the security afforded to it by the terms
of this Agreement, the Trustee may require indemnity satisfactory to the Trustee
against such cost, expense or liability as a condition to taking any such
action;
(e) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,
accountants or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agents, accountants or attorneys
appointed with due care by it hereunder;
(f) the Trustee shall not be required to risk or expend its own
funds or otherwise incur any financial liability in the performance of any of
its duties or in the exercise of any of its rights or powers hereunder if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not assured to it;
(g) the Trustee shall not be liable for any loss on any investment
of funds pursuant to this Agreement;
(h) except as otherwise provided in Section 7.01 or if a Responsible
Officer of the Trustee has actual knowledge or written notice of the occurrence
of a Master Servicer Event of Default, the Trustee shall not be deemed to have
knowledge of a Master Servicer Event of Default until a Responsible Officer of
the Trustee shall have received written notice thereof;
(i) the Trustee shall be under no obligation to exercise any of the
trusts, rights or powers vested in it by 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 this Agreement,
unless such Certificateholders shall have offered to the Trustee reasonable
security or indemnity satisfactory to the Trustee against the costs, expenses
and liabilities which may be incurred therein or thereby;
(j) the right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the Trustee
shall not be answerable for other than its negligence or willful misconduct in
the performance of such act;
(k) the Trustee shall not be required to give any bond or surety in
respect of the execution of the Trust Fund created hereby or the powers granted
hereunder; and
(l) the Custodian shall be entitled to the same protections,
immunities and indemnities afforded the Trustee in and under this Agreement.
(m) the Custodian shall be permitted to utilize one or more
Subcontractors for the performance of certain of its obligations under this
Agreement, provided that the Custodian complies with Section 3.02(e) as if the
Custodian were a "Servicer" pursuant to that Section. The Custodian shall
indemnify the Depositor (and its Affiliate Xxxxxx Xxxxxxx Mortgage Capital
Inc.), the Unaffiliated Seller, the Trustee, the Securities Administrator, the
Master Servicer and any director, officer, employee or agent of the Depositor
(and its Affiliate Xxxxxx Xxxxxxx Mortgage Capital Inc.), the Unaffiliated
Seller, the Trustee, the Securities Administrator and the Master Servicer and
hold them harmless against any and all claims, losses, damages, penalties,
fines, forfeitures, reasonable and necessary legal fees and related costs,
judgments, and any other costs, fees and expenses that any of them may sustain
in any way related to the failure of the Custodian to perform any of its
obligations under Section 3.23, including without limitation any failure by the
Custodian to identify pursuant to Section 3.02(e) any Subcontractor that is a
Servicing Function Participant. This indemnity shall survive the termination of
this Agreement or the earlier resignation or removal of the Custodian.
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates shall be taken as the
statements of the Depositor and the Trustee assumes no responsibility for their
correctness. The Trustee makes no representations as to the validity or
sufficiency of this Agreement or of the Certificates or of any Mortgage Loan or
related document. The Trustee shall not be accountable for the use or
application by the Depositor, the Master Servicer, the Securities Administrator
or the Servicer of any funds paid to the Depositor, the Master Servicer, the
Securities Administrator or the Servicer in respect of the Mortgage Loans or
deposited in or withdrawn from the Distribution Account or any Collection
Account by the Depositor, the Master Servicer, the Securities Administrator or
the Servicer.
The Trustee, the Securities Administrator, and the Master Servicer
shall have no responsibility for filing or recording 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 it
hereunder.
Section 8.04 Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights as it would have if it were not the Trustee.
Section 8.05 Trustee's and Custodian's Fees and Expenses. (a) As
compensation for its activities under this Agreement, the Trustee and the
Custodian each shall be paid its fee by the Securities Administrator from the
Securities Administrator's own funds pursuant to a separate fee schedule and
shall have no lien on the Trust Fund for the payment of such fees. The
Custodian, the Trustee and any director, officer, employee, or agent of the
Custodian or the Trustee shall be indemnified by the Servicer against any loss,
liability, or expense (including reasonable attorney's fees) resulting from any
failure by the Servicer to perform their obligations under this Agreement. This
indemnity shall survive the termination of this Agreement or the resignation or
removal of the Trustee and the Custodian, as applicable, under this Agreement.
(b) [Reserved].
(c) Each of the undertakings and agreements made on the part of the
Trustee on behalf of the Trust Fund in the Certificates is made and intended not
as a personal undertaking or agreement by the Trustee but is made and intended
for the purpose of binding only the Trust Fund.
Section 8.06 Eligibility Requirements for the Trustee. The Trustee
hereunder shall at all times be a corporation or 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 of at least $50,000,000, subject to supervision or examination by
federal or state authority and with a credit rating which would not cause any of
the Rating Agencies to reduce their respective then current ratings of the
Certificates (or having provided such security from time to time as is
sufficient to avoid such reduction) as evidenced in writing by each Rating
Agency. If such corporation or association 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 8.06
the combined capital and surplus of such corporation or association shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. In case at any time the Trustee shall cease to
be eligible in accordance with this Section 8.06, the Trustee shall resign
immediately in the manner and with the effect specified in Section 8.07. The
entity serving as Trustee may have normal banking and trust relationships with
the Depositor and its affiliates or the Servicer and its affiliates; provided,
however, that such entity cannot be an affiliate of the Depositor, the
Unaffiliated Seller or the Servicer.
Section 8.07 Resignation and Removal of the Trustee. The Trustee may
at any time resign and be discharged from the trusts hereby created by giving
written notice of resignation to the Depositor, the Servicer, the Swap Provider,
the Cap Provider, the Custodian, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and each Rating Agency not less than 60 days
before the date specified in such notice, when, subject to Section 8.08, such
resignation is to take effect, and acceptance by a successor trustee in
accordance with Section 8.08 meeting the qualifications set forth in Section
8.06. If no successor trustee meeting such qualifications shall have been so
appointed and have accepted appointment within 30 days after the giving of such
notice or resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
If at any time the Trustee shall cease to be eligible in accordance
with Section 8.06 and shall fail to resign after written request thereto by the
Depositor, or if at any time the Trustee shall become incapable of acting, or
shall be adjudged as bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, or a tax is imposed with respect to
the Trust Fund by any state in which the Trustee or the Trust Fund is located
and the imposition of such tax would be avoided by the appointment of a
different trustee, then the Depositor may remove the Trustee and appoint a
successor trustee by written instrument, in triplicate, one copy of which shall
be delivered to the Trustee, one copy to the Servicer, one copy to the Master
Servicer and one copy to the successor trustee.
The Holders of Certificates entitled to at least a majority of the
Voting Rights may at any time remove the Trustee and appoint a successor trustee
by written instrument or instruments, in triplicate, signed by such Holders or
their attorneys-in-fact duly authorized, one complete set of which shall be
delivered by the successor Trustee to the Servicer, one complete set to the
Trustee so removed and one complete set to the successor so appointed. The
successor trustee shall notify the Swap Provider, the Cap Provider and each
Rating Agency of any removal of the Trustee.
Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to this Section 8.07 shall become effective upon
acceptance of appointment by the successor trustee as provided in Section 8.08.
Section 8.08 Successor Trustee. Any successor trustee appointed as
provided in Section 8.07 shall execute, acknowledge and deliver to the Swap
Provider, the Cap Provider, the Depositor and to its predecessor trustee and the
Servicer an instrument accepting such appointment hereunder and thereupon the
resignation or removal of the predecessor trustee shall become effective and
such successor trustee, 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
herein. The Depositor, the Servicer, Securities Administrator and the
predecessor trustee shall execute and deliver such instruments and do such other
things as may reasonably be required for more fully and certainly vesting and
confirming in the successor trustee all such rights, powers, duties, and
obligations.
No successor trustee shall accept appointment as provided in this
Section 8.08 unless at the time of its acceptance, the successor trustee is
eligible under Section 8.06 and its appointment does not adversely affect the
then current rating of the Certificates.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates. If the Depositor fails to mail
such notice within 10 days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be mailed at the
expense of the Depositor.
Section 8.09 Merger or Consolidation of the Trustee. Any corporation
into which the Trustee may be merged or converted or with which it may be
consolidated or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to the business of the Trustee, shall be the successor of the Trustee
hereunder; provided that such corporation shall be eligible under Section 8.06
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. In
connection with the succession to the Trustee under this Agreement by any Person
(i) into which the Trustee may be merged or consolidated, or (ii) which may be
appointed as a successor to the Trustee, the Trustee shall notify the Securities
Administrator and the Depositor of such succession or appointment and shall
furnish to the Securities Administrator and the Depositor in writing and in form
and substance reasonably satisfactory to the Securities Administrator and the
Depositor, all information reasonably necessary for the Securities Administrator
to accurately and timely report, pursuant to Section 8.12(g), the event under
Item 6.02 of Form 8-K pursuant to the Exchange Act (if such reports under the
Exchange Act are required to be filed under the Exchange Act).
Section 8.10 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 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 8.10, such powers, duties, obligations, rights and trusts as the
Servicer and the Trustee may consider appropriate. If the 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 8.06 and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and conditions:
(a) To the extent necessary to effectuate the purposes of this
Section 8.10, all rights, powers, duties and obligations conferred or imposed
upon the Trustee (except for the obligation of the Trustee as successor Master
Servicer under this Agreement to advance funds), 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 as Trustee hereunder or as
successor to the 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 applicable 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;
(b) No trustee hereunder shall be held personally liable because of
any act or omission of any other trustee hereunder and such appointment shall
not, and shall not be deemed to, constitute any such separate trustee or
co-trustee as agent of the Trustee;
(c) The Trustee may at any time accept the resignation of or remove
any separate trustee or co-trustee; and
(d) The Trust, and not the Master Servicer, shall be liable for the
payment of reasonable compensation and expenses to any such separate trustee or
co-trustee on each Distribution Date.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the separate trustees and co-trustees, when
and 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 VIII. 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 and indemnity to, the
Trustee. Every such instrument shall be filed with the Trustee and a copy
thereof given to the 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 8.11 Tax Matters. It is intended that the assets with
respect to which any REMIC election pertaining to the Trust Fund is to be made,
as set forth in the Preliminary Statement, shall constitute, and that the
conduct of matters relating to such assets shall be such as to qualify such
assets 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
each Trust REMIC and that in such capacity it shall:
(a) prepare for the Trustee to sign, and the Trustee shall sign, and
the Securities Administrator shall file, in a timely manner, a U.S. Real Estate
Mortgage Investment Conduit (REMIC) Income Tax Return (Form 1066 or any
successor form adopted by the Internal Revenue Service) and prepare for the
Trustee to sign, and the Trustee shall sign, and the Securities Administrator
shall file 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 Trust 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 to Certificateholders the schedules, statements or
information at such times and in such manner as may be required thereby;
(b) apply for an employer identification number from the Internal
Revenue Service via Form SS-4 or any other acceptable method for all tax
entities (i.e., the Trust REMICs and the Grantor Trust), furnish to the
Depositor, not later than the Closing Date in the case of the Grantor Trust (the
corpus of which includes the Interest Rate Swap Agreement and the Interest Rate
Cap Agreement) and within thirty days of the Closing Date in the case of the
Trust REMICs, copies of such Form SS-4 requesting the employer identification
numbers, use its best efforts to obtain, as promptly as practicable, employer
identification numbers for any other Trust REMICs or Grantor Trust created
pursuant to this Agreement (and provide such employer identification numbers to
the Depositor promptly upon receipt thereof), furnish to the Internal Revenue
Service, on Form 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;
(c) deliver or cause to be delivered the federal taxpayer
identification number of the Grantor Trust on a correct, complete and duly
executed IRS Form W-9 of the Grantor Trust to the Swap Provider and the Cap
Provider promptly upon receipt of such number after applying for it pursuant to
8.11(b) above and, in any event, no later than the first Payment Date under the
Interest Rate Swap Agreement and the Interest Rate Cap Agreement, as applicable,
and, if requested by the Swap Provider or the Cap Provider, an applicable IRS
Form W-8IMY;
(d) make an election that each of REMIC PF, Pooling-Tier REMIC-1,
Pooling-Tier REMIC-2, the Lower-Tier REMIC, the Upper-Tier REMIC and the Class X
REMIC be treated as a REMIC on the federal tax return for its first taxable year
(and, if necessary, under applicable state law);
(e) prepare and forward 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 the calculation of any original
issue discount using the prepayment assumption (as described in the Prospectus
Supplement);
(f) provide information necessary for the computation of tax imposed
on the Transfer of a Residual Certificate to a Person that is a Non-Permitted
Transferee, or an agent (including a broker, nominee or other middleman) of a
Non-Permitted Transferee, or a pass through entity in which a Non-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);
(g) to the extent that they are under its control, conduct matters
relating to such assets at all times that any Certificates are Outstanding so as
to maintain the status of each Trust REMIC as a REMIC under the REMIC
Provisions;
(h) not knowingly or intentionally take any action or omit to take
any action that would cause the termination of the REMIC status of any Trust
REMIC created hereunder;
(i) pay, from the sources specified in the last paragraph of this
Section 8.11, the amount of any federal or state tax, including prohibited
transaction taxes as described below, imposed on any Trust REMIC created
hereunder before its termination 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);
(j) cause federal, state or local income tax or information returns
to be signed by the Trustee or such other Person as may be required to sign such
returns by the Code or state or local laws, regulations or rules; and
(k) maintain records relating to each Trust REMIC created hereunder,
including the income, expenses, assets, and liabilities thereof on a calendar
year basis and on the accrual method of accounting and the fair market value and
adjusted basis of the assets determined at such intervals as may be required by
the Code, as may be necessary to prepare the foregoing returns, schedules,
statements or information.
The Holder of the largest Percentage Interest of the Class RX
Certificates shall act as Tax Matters Person for the Class X REMIC, and the
holder of the largest Percentage Interest of the Class R Certificates shall act
as Tax Matters Person for REMIC PF, Pooling-Tier REMIC-1, Pooling-Tier REMIC-2,
the Lower-Tier REMIC and the Upper-Tier REMIC, in each case, within the meaning
of Treasury Regulations Section 1.860F-4(d), and the Securities Administrator is
hereby designated as agent of such Certificateholder for such purpose (or if the
Securities Administrator is not so permitted, such Holder shall be the Tax
Matters Person in accordance with the REMIC Provisions). In such capacity, the
Securities Administrator shall, as and when necessary and appropriate, represent
each Trust REMIC created hereunder 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 each Trust REMIC
created hereunder, enter into settlement agreements with any governmental taxing
agency, extend any statute of limitations relating to any tax item of each Trust
REMIC created hereunder, and otherwise act on behalf of each Trust REMIC in
relation to any tax matter or controversy involving it.
The Securities Administrator shall treat the rights of the Class P
Certificateholders to Prepayment Charges, the rights of the Class X
Certificateholders to receive amounts in the Excess Reserve Fund Account and the
Swap Account (subject to the obligation to pay Basis Risk CarryForward Amounts
and, without duplication, Upper-Tier CarryForward Amounts) and the rights of the
LIBOR Certificateholders to receive Basis Risk CarryForward Amounts and, without
duplication, Upper-Tier CarryForward Amounts as the beneficial ownership of
interests in the Grantor Trust, and not as obligations of any Trust REMIC
created hereunder, for federal income tax purposes. The Securities Administrator
shall file or cause to be filed with the Internal Revenue Service Form 1041 or
such other form as may be applicable and, as described above, shall apply for an
employer identification number from the Internal Revenue Service via Form SS-4
or any other acceptable method for the Grantor Trust and shall furnish or cause
to be furnished, to the Class P Certificateholders, Class X Certificateholders
and LIBOR Certificateholders and the Unaffiliated Seller, the respective amounts
described above that are received, in the time or times and in the manner
required by the Code.
To enable the Securities Administrator to perform its duties under
this Agreement, the Depositor shall provide to the Securities Administrator
within ten days after the Closing Date all information or data that the
Securities Administrator requests in writing and determines to be relevant for
tax purposes to the valuations and offering prices of the Certificates,
including the price, yield, prepayment assumption, and projected cash flows of
the Certificates and the Mortgage Loans. Moreover, the Depositor shall provide
information to the Securities Administrator concerning the value, if any, to
each Class of Certificates of the right to receive Basis Risk CarryForward
Amounts from the Excess Reserve Fund Account and Basis Risk CarryForward Amounts
and, without duplication, Upper-Tier CarryForward Amounts from the Swap Account.
Thereafter, the Depositor shall provide to the Securities Administrator promptly
upon written request therefor any additional information or data that the
Securities Administrator may, from time to time, reasonably request to enable
the Securities Administrator to perform its duties under this Agreement;
provided, however, that the Depositor shall not be required to provide any
information regarding the Mortgage Loans that the Servicer is required to
provide to the Securities Administrator pursuant to this Agreement. The
Depositor hereby indemnifies the Securities Administrator for any losses,
liabilities, damages, claims, or expenses of the Securities Administrator
arising from any errors or miscalculations of the Securities Administrator that
result from any failure of the Depositor to provide pursuant to this paragraph
accurate information or data to the Securities Administrator on a timely basis.
None of the Servicer, the Trustee, the Master Servicer or the
Securities Administrator shall (i) permit the creation of any interests in any
Trust REMIC other than the regular and residual interests set forth in the
Preliminary Statement, (ii) receive any amount representing a fee or other
compensation for services (except as otherwise permitted by this Agreement or
the related Mortgage Loan documents) or (iii) otherwise knowingly or
intentionally take any action, cause the Trust Fund to 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, could (i) endanger
the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a
tax upon any Trust REMIC or 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, or
the tax on "net income from foreclosure property") unless the Trustee and the
Securities Administrator receive an Opinion of Counsel (at the expense of the
party seeking to take such action or, if such party fails to pay such expense,
and the Securities Administrator determines that taking such action is in the
best interest of the Trust Fund and the Certificateholders, at the expense of
the Trust Fund, but in no event at the expense of the Trustee or the Securities
Administrator) to the effect that the contemplated action will not, with respect
to the Trust Fund, any Trust REMIC created hereunder, endanger such status or,
unless the Trustee determines in its sole discretion to indemnify the Trust Fund
against such tax, result in the imposition of such a tax).
If any tax is imposed on "prohibited transactions" of any Trust
REMIC as defined in Section 860F(a)(2) of the Code, on the "net income from
foreclosure property" of the Pooling-Tier REMIC-1 as defined in Section 860G(c)
of the Code, on any contribution to any Trust REMIC after the Start-up Day
pursuant to Section 860G(d) of the Code, or any other tax is imposed, including,
if applicable, any minimum tax imposed on any Trust REMIC pursuant to Sections
23153 and 24878 of the California Revenue and Taxation Code, if not paid as
otherwise provided for herein, the tax shall be paid by (i) the Trustee, the
Master Servicer or the Securities Administrator, respectively, if such tax
arises out of or results from negligence of the Trustee, the Master Servicer or
the Securities Administrator, as applicable, in the performance of any of its
obligations under this Agreement, (ii) the Servicer, in the case of any such
minimum tax, and the Servicer if such tax arises out of or results from a breach
by the Servicer of any of its obligations under this Agreement, (iii) the
Unaffiliated Seller if such tax arises out of or results from the Unaffiliated
Seller's obligation to repurchase a Mortgage Loan pursuant to Section 2.03 or
(iv) in all other cases, or if the Trustee, the Securities Administrator, the
Master Servicer, the Servicer or the applicable Unaffiliated Seller fails to
honor its obligations under the preceding clause (i), (ii) or (iii), any such
tax will be paid with amounts otherwise to be distributed to the
Certificateholders, as provided in Section 4.02(a).
The Grantor Trust shall be treated as a WHFIT that is a NMWHFIT. The
Securities Administrator shall report as required under the WHFIT Regulations to
the extent such information as is reasonably necessary to enable the Securities
Administrator to do so, and is not in its possession, is provided to the
Securities Administrator on a timely basis. The Securities Administrator is
hereby directed to assume that DTC is the only "middleman" (as such term is
defined in the WHFIT Regulations) unless the Depositor provides the Securities
Administrator with the identities of other "middlemen" that are
Certificateholders. The Securities Administrator shall be entitled to rely on
the first sentence of this paragraph and shall be entitled to indemnification in
accordance with the terms of this Agreement in the event that the Internal
Revenue Service makes a determination that the first sentence of this paragraph
is incorrect.
The Securities Administrator, in its discretion, shall report
required WHFIT information using either the cash or accrual method, except to
the extent the WHFIT Regulations specifically require a different method. The
Securities Administrator shall be under no obligation to determine whether any
Certificateholder or other beneficial owner of a Certificate, to the extent the
Securities Administrator knows of any other beneficial owner of a Certificate,
uses the cash or accrual method. The Securities Administrator shall make
available information as required by the WHFIT Regulations to Certificateholders
annually. In addition, the Securities Administrator shall not be responsible or
liable for providing subsequently amended, revised or updated information to any
Certificateholder, unless requested by the Certificateholder.
The Securities Administrator shall not be liable for failure to meet
the reporting requirements of the WHFIT Regulations nor for any penalties
thereunder if such failure is due to: (i) the lack of reasonably necessary
information being provided to the Securities Administrator, (ii) incomplete,
inaccurate or untimely information being provided to the Securities
Administrator or (iii) the inability of the Securities Administrator, after good
faith efforts, to alter its existing information reporting systems to capture
information necessary to fully comply with the WHFIT Regulations for the 2007
calendar year. Absent receipt of information regarding any sale of Certificates,
including the price, amount or proceeds and date of sale from the beneficial
owner thereof or the Depositor, the Securities Administrator may assume there is
no secondary market trading of WHFIT interests.
To the extent required by the WHFIT Regulations, the Securities
Administrator shall use reasonable efforts to publish on an appropriate website
the CUSIP Numbers for the Certificates that represent ownership of a WHFIT. The
CUSIP Numbers so published will represent the Rule 144A CUSIP Numbers. The
Securities Administrator shall make reasonable good faith efforts to keep the
website accurate and updated to the extent CUSIP Numbers have been received. The
Securities Administrator shall not be liable for investor reporting delays that
result from the receipt of inaccurate or untimely CUSIP Number information. The
Securities Administrator shall be entitled to additional reasonable compensation
for changes in reporting required in respect of the WHFIT Regulations that arise
as a result of a change in the WHFIT Regulations or a change in interpretation
of the WHFIT Regulations by the IRS, if such change requires, in the Securities
Administrator's sole discretion, a material increase in the Securities
Administrator's reporting obligations in respect of the related Grantor Trust.
Section 8.12 Periodic Filings. (a) The Securities Administrator, the
Master Servicer and the Servicer shall reasonably cooperate with the Depositor
in connection with the reporting requirements of the Trust under the Exchange
Act. The Securities Administrator shall prepare for execution by the Master
Servicer any Forms 8-K (other than the initial Form 8-K relating to this
Agreement, which shall be the responsibility of the Depositor to prepare and
file), 10-D and 10-K required by the Exchange Act and the rules and regulations
of the Commission thereunder, in order to permit the timely filing thereof,
pursuant to the terms of this Section 8.12, and the Securities Administrator
shall file (via the Commission's Electronic Data Gathering and Retrieval System,
or XXXXX) such Forms executed by the Master Servicer. Each of Form 10-D and Form
10-K requires the Depositor 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." A "yes" shall be indicated on each
Form 10-D and 10-K unless the Depositor shall notify the Securities
Administration 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
and no later than March 15th with respect to the filing of a report on Form
10-K, that a "no" should be indicated. The Securities Administrator and the
Master Servicer shall be entitled to rely on such notice (or lack thereof) in
preparing, executing and/or filing any such report.
(b) The Securities Administrator shall prepare and file on behalf of
the Trust any Form 10-D required by the Exchange Act, in form and substance as
required by the Exchange Act. The Securities Administrator will utilize
reasonable best efforts to file such Form 10-D on or by the 14th calendar day
after each Distribution Date, but in no event later than the filing deadline for
such Form 10-D (subject to permitted extensions under the Exchange Act). The
Securities Administrator shall file each Form 10-D with a copy of the related
Monthly Statement attached thereto. 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 prepared by the party responsible for preparing such
disclosure as set forth in Exhibit R hereto and the Securities Administrator
shall compile such disclosure pursuant to the following paragraph. The
Securities Administrator will have no duty or liability for any failure
hereunder to determine or prepare any Additional Form 10-D Disclosure, except as
set forth in the next paragraph.
As set forth on Exhibit R hereto, within 5 calendar days after the
related Distribution Date, the parties to this Agreement shall be required to
provide to the Securities Administrator and the Depositor, in XXXXX-compatible
format, or in such other form as otherwise agreed upon by the Securities
Administrator and such party, to the extent known by such applicable parties,
any Additional Form 10-D Disclosure, if applicable, together with an Additional
Disclosure Notification in the form of Exhibit U hereto ("Additional Disclosure
Notification"). 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. The Depositor will be responsible for all reasonable fees and
expenses assessed or incurred by the Securities Administrator in connection with
including any Additional Form 10-D Disclosure on Form 10-D pursuant to this
paragraph, including converting any such disclosure to an XXXXX-compatible
format.
The Securities Administrator shall prepare and forward
electronically a draft copy of the Form 10-D to the Depositor sufficiently far
in advance of, but in no event later than the 11th calendar day after the
related Distribution Date, for the Depositor to review and verify such Form
10-D. In the absence of receipt of any written changes or approval, the
Securities Administrator shall be entitled to assume that such Form 10-D is in
final form and the Securities Administrator may proceed with procuring the
execution of and filing the Form 10-D. No later than 2 Business Days prior to
the 15th calendar day after the related Distribution Date, a duly authorized
representative of the Master Servicer shall sign the Form 10-D. 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
8.12(e)(ii). Promptly (but in any case within one Business Day) after filing
with the Commission, the Securities Administrator will make available on its
internet website a final executed copy of each Form 10-D prepared and filed by
the Securities Administrator. The Depositor can be contacted at the Depositor's
address for notices set forth in Section 12.05(b)(ii)(a) or such other address
as to which the Depositor has provided prior written notice to the Securities
Administrator. The Depositor acknowledges that the performance by the Securities
Administrator and the Master Servicer of their duties under this Section 8.12(b)
related to the timely preparation, execution and filing of Form 10-D is
contingent, in part, upon the Servicer, the Depositor and any other Person
obligated to provide Additional Form 10-D Disclosure as set forth on Exhibit R
hereto, observing all applicable deadlines in the performance of their duties
under this Section 8.12(b). Neither the Master Servicer nor the Securities
Administrator shall have any liability for any loss, expense, damage, claim
arising out of or with respect to any failure to properly prepare, execute
and/or timely file such Form 10-D, where such failure results from the
Securities Administrator's or the Master Servicer's inability or failure to
obtain or receive, on a timely basis, any information from any party hereto
(other than the Securities Administrator, the Master Servicer or any
Subcontractor utilized by the Securities Administrator or the Master Servicer)
needed to prepare, execute or file such Form 10-D, not resulting from their own
negligence, bad faith or willful misconduct.
(c) On any date within 90 days (including 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"), commencing in March 2008, 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 time frames set
forth in this Agreement, (i) an annual compliance statement for the Securities
Administrator, the Master Servicer, the Servicer and each Subservicer engaged by
the Servicer, as described under Section 3.22, (ii)(A) the annual reports on
assessment of compliance with servicing criteria for the Securities
Administrator, the Master Servicer, the Trustee, the Servicer, each Subservicer
engaged by the Servicer and each Servicing Function Participant utilized by the
Servicer, the Master Servicer, the Securities Administrator or the Trustee, as
described under Section 3.23, and (B) if any such report on assessment of
compliance with servicing criteria described under Section 3.23 identifies any
material instance of noncompliance, disclosure identifying such instance of
noncompliance, or such report on assessment of compliance with servicing
criteria described under Section 3.23 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 Securities Administrator, the Master Servicer, the
Servicer, the Trustee, each Subservicer engaged by the Servicer and each
Servicing Function Participant utilized by the Servicer, the Master Servicer or
the Securities Administrator, or the Trustee, as described under Section 3.23,
and (B) if any registered public accounting firm attestation report described
under Section 3.23 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 certification substantially in the form
attached hereto as Exhibit N, with such changes as may be necessary or
appropriate as a result of changes promulgated by the Commission (the "Sarbanes
Certification"), which shall be signed by the senior officer of the Master
Servicer in charge of securitization. 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 prepared by the party responsible
for preparing such disclosure as set forth on Exhibit S hereto, and the
Securities Administrator shall compile such disclosure pursuant to the following
paragraph. The Securities Administrator will have no duty or liability for any
failure hereunder to determine or prepare any Additional Form 10-K Disclosure,
except as set forth in the next paragraph.
As set forth on Exhibit S hereto, no later than March 1st of each
year (or, in the case of the Servicer, March 5th of each year) that the Trust is
subject to the Exchange Act reporting requirements, commencing in 2007, the
parties to this Agreement shall be required to provide to the Securities
Administrator and the Depositor, in XXXXX-compatible format, or in such other
form as otherwise agreed upon by the Securities Administrator and such party, to
the extent known by such applicable parties, any Additional Form 10-K
Disclosure, if applicable, together with an Additional Disclosure Notification.
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. The Depositor will
be responsible for all reasonable fees and expenses assessed or incurred by the
Securities Administrator in connection with including any Additional Form 10-K
Disclosure on Form 10-K pursuant to this paragraph, including converting any
such disclosure to an XXXXX-compatible format. The Securities Administrator
shall compile all such information provided to it in a Form 10-K prepared by it.
The Securities Administrator shall prepare and forward
electronically a draft copy of the Form 10-K to the Depositor sufficiently far
in advance of, but in no event less than three (3) Business Days prior to, when
the Master Servicer is required to execute such Form 10-K to permit the
Depositor to review and verify such Form 10-K. In the absence of receipt of any
written changes or approval, the Securities Administrator shall be entitled to
assume that such Form 10-K is in final form and the Securities Administrator may
proceed with procuring the execution of and filing the Form 10-K. No later than
5:00 p.m. EST on the 4th Business Day prior to the 10-K Filing Deadline, the
senior officer in charge of the servicing function of the Master Servicer shall
sign the Form 10-K. 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 8.12(e)(ii). Promptly (but in any case
within one Business Day) after filing with the Commission, the Securities
Administrator will make available on its internet website a final executed copy
of each Form 10-K prepared and filed by the Securities Administrator. The
Depositor acknowledges that the performance by the Securities Administrator and
the Master Servicer of their duties under this Section 8.12(c) related to the
timely preparation and filing of Form 10-K is contingent, in part, upon the
Servicer (and any Subservicer or Servicing Function Participant engaged by the
Servicer) and the Depositor and any other Person obligated to provide Additional
Form 10-K Disclosure as set forth on Exhibit S hereto, observing all applicable
deadlines in the performance of their duties under this Section 8.12(c), Section
8.12(d), Section 3.22 and Section 3.23. Neither the Master Servicer nor the
Securities Administrator shall have any liability for any loss, expense, damage
or claim arising out of or with respect to any failure to properly prepare,
execute and/or timely file such Form 10-K, where such failure results from the
Securities Administrator's or the Master Servicer's inability or failure to
obtain or receive, on a timely basis, any information from any party hereto
(other than the Securities Administrator, the Master Servicer or any
Subcontractor utilized by the Securities Administrator or the Master Servicer)
needed to prepare, execute or file such Form 10-K, not resulting from their own
negligence, bad faith or willful misconduct.
(d) Each of the Securities Administrator, the Master Servicer and
the Servicer shall provide, and each such party shall cause any Servicing
Function Participant engaged by it to provide, to the Person who signs the
Sarbanes Certification (the "Certifying Person"), by March 15th (or is such day
is not a Business Day, the immediately preceding Business Day) 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
(each, a "Back-Up Certification"), substantially in the form attached hereto as
Exhibit O (with such changes as may be necessary or appropriate as a result of
changes promulgated by the Commission) 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. 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 by e-mail at xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx or by
facsimile at 000-000-0000. In the event any such party or any Servicing Function
Participant engaged by such party is terminated or resigns pursuant to the terms
of this Agreement, or any applicable sub-servicing agreement, as the case may
be, such part shall provide a Back-Up Certification to the Certifying Person
pursuant to this Section 8.12(d) with respect to the period of time it was
subject to this Agreement or any applicable sub-servicing agreement, as the case
may be. 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 Sarbanes Certification in the event that it does not receive any
Back-Up Certification required to be furnished to it pursuant to this Section
8.12(d). In the event that prior to the filing date of the Form 10-K in March of
each year, the Servicer, the Master Servicer or the Securities Administrator has
actual knowledge of information material to the Sarbanes Certification, that
party shall promptly notify the Depositor and each of the other parties signing
the certifications. In addition, (i) the Securities Administrator shall
indemnify and hold harmless the Depositor and the Sponsor and their officers,
directors, employees, agents and Affiliates from and against any losses,
damages, penalties, fines, forfeitures, reasonable and necessary legal fees and
related costs, judgments and other costs and expenses arising out of or based
upon any breach of the Securities Administrator's obligations under this Section
8.12(d) or any material misstatement or material omission in (w) any compliance
certificate delivered by the Securities Administrator or any Subcontractor of
the Securities Administrator pursuant to Section 3.22 of this Agreement, (x) any
assessment or attestation delivered by or on behalf of the Securities
Administrator or any Subcontractor of the Securities Administrator pursuant to
Section 3.23 of this Agreement, (y) any Back-Up Certification in the form of
Exhibit O delivered by the Securities Administrator pursuant to Section 8.12(d)
of this Agreement or (z) any information about the Securities Administrator
provided by it pursuant to Item 2 (Legal Proceedings) of Exhibit R, Item 1117
and Item 1119 of Exhibit T or Item 6.02 (Change of Securities Administrator) of
Exhibit S (collectively, the "Securities Administrator Information"), or the
Securities Administrator's negligence, bad faith or willful misconduct in
connection therewith, (ii) the Servicer, severally and not jointly, shall
indemnify and hold harmless the Depositor, the Sponsor, the Securities
Administrator, the Master Servicer and their respective officers, directors,
employees, agents and Affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments and other costs and expenses arising out of or based upon any
breach of such Servicer's obligations under this Section 8.12(d) or any material
misstatement or material omission, negligence, bad faith or willful misconduct
of such Servicer in connection therewith, and (iii) the Master Servicer shall
indemnify and hold harmless the Depositor, the Sponsor, the Securities
Administrator and their respective officers, directors, employees, agents and
Affiliates from and against any losses, damages, penalties, fines, forfeitures,
reasonable and necessary legal fees and related costs, judgments and other costs
and expenses arising out of or based upon any breach of the Master Servicer's
obligations under this Section 8.12(d) or any material misstatement or material
omission, negligence, bad faith or willful misconduct of the Master Servicer in
connection therewith. If the indemnification provided for herein is unavailable
or insufficient to hold harmless any indemnified party, then (i) the Securities
Administrator agrees in connection with a breach of the Securities
Administrator's obligations under this Section 8.12(d) or any material
misstatement or material omission contained in any Securities Administrator
Information, or any negligence, bad faith or willful misconduct in connection
therewith that it shall contribute to the amount paid or payable by the
Depositor and the Sponsor as a result of the losses, claims, damages or
liabilities of the Depositor and the Sponsor in such proportion as is
appropriate to reflect the relative fault of the Depositor and the Sponsor on
the one hand and the Securities Administrator on the other and (ii) the
Servicer, several and not jointly, agrees that it shall contribute to the amount
paid or payable by such indemnified party as a result of the losses, claims,
damages or liabilities of such indemnified party in such proportion as is
appropriate to reflect the relative fault of such indemnified party, on the one
hand, and such Servicer, on the other hand, in connection with a breach of such
Servicer's obligations under this Section 8.12(d) or any material misstatement
or material omission, negligence, bad faith or willful misconduct of such
Servicer in connection therewith.
The obligations of the Securities Administrator, the Master
Servicer, the Servicer and each Servicing Function Participant under this
Section 8.12(d) shall apply to the Securities Administrator, the Master
Servicer, the Servicer and each Servicing Function Participant that serviced a
Mortgage Loan during the applicable period, whether or not such Securities
Administrator, the Master Servicer, the Servicer or such Servicing Function
Participant is acting as Securities Administrator, Master Servicer, the Servicer
or a Servicing Function Participant, as applicable, at the time such
certification is required to be delivered. The indemnification and contribution
obligations set forth in this Section 8.12(d) shall survive the termination of
this Agreement or the earlier resignation or removal of the Securities
Administrator, the Master Servicer or the Servicer, as applicable.
(e) (i) The obligations set forth in paragraphs (a) through (g) of
this Section shall only apply with respect to periods for which reports are
required to be filed with respect to the Trust under the Exchange Act. 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 Suspension Notification with respect to the Trust, with a copy to the
Depositor. At the beginning of the immediately succeeding calendar year after
the filing of a Form 15 Suspension Notification, if the number of Holders of the
Offered Certificates of record exceeds the number set forth in Section 15(d) of
the Exchange Act or the regulations promulgated pursuant thereto which would
cause the Trust to again become subject to the reporting requirements of the
Exchange Act, the Securities Administrator shall recommence preparing and
filing, and the Master Servicer shall recommence executing, reports on Form
10-K, 10-D and 8-K as required pursuant to this Section 8.12 and the parties
hereto shall again have the obligations set forth in this Section.
(ii) 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 (other than the initial Form 8-K filed by the Depositor with respect
to this Agreement), 10-D or 10-K required to be filed pursuant to this
Agreement because required disclosure information was either not delivered
to it or delivered to it after the delivery deadlines (and the expiration
of the applicable grace period with respect to such deadline prior to such
failure to deliver resulting in an Event of Default) set forth in this
Agreement, the Securities Administrator will promptly electronically
notify the Depositor and if necessary, or applicable, the Servicer. In the
case of Form 10-D and 10-K, the Depositor, Servicer and the Securities
Administrator will thereupon cooperate to prepare and file a Form 12b-25
and a 10-DA 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 disclosure information required to be included on Form
8-K and as directed by 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 party to this Agreement deciding
that an amendment to such Form 8-K, 10-D or 10-K is required will notify
the Depositor if the amendment pertains to an additional disclosure item
and the Depositor will cooperate to prepare any necessary Form 8-K/A,
10-D/A or 10-K/A. Any Form 15, Form 12b-25 or any amendment to Form 8-K,
10-D or 10-K shall be signed by a duly authorized representative or a
senior officer in charge of master servicing, as applicable, of the Master
Servicer. The parties to this Agreement acknowledge that the performance
by the Master Servicer and the Securities Administrator of its duties
under this Section 8.12(e) related to the timely preparation and filing of
Form 15, a Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K is
contingent upon the Servicer and the Depositor observing all applicable
deadlines (and the related grace periods thereto) in the performance of
their duties under this Section 8.12 and Section 3.22 and 3.23. Neither
the Master Servicer nor the Securities Administrator shall have any
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 Forms 8-K, 10-D or 10-K, where
such failure results from the Securities Administrator's inability or
failure to obtain or receive, on a timely basis, any information from any
party hereto (other than the Securities Administrator, the Master Servicer
or any Subcontractor utilized by the Securities Administrator or the
Master Servicer) needed to prepare, arrange for execution or file such
Form 15, Form 12b-25 or any amendments to Forms 8-K, 10-D or 10-K, not
resulting from its own negligence, bad faith or willful misconduct.
(f) On any date within four (4) Business Days after the occurrence
of an event requiring disclosure on Form 8-K (each such event, a "Reportable
Event"), and if requested by the Depositor, the Securities Administrator shall
prepare and file on behalf of the Trust 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 reported and prepared by
the party responsible for preparing such disclosure as set forth on Exhibit T
hereto and compiled by the Securities Administrator pursuant to the following
paragraph. The Securities Administrator will have no duty or liability for any
failure hereunder to determine or prepare any Form 8-K Disclosure Information or
any Form 8-K, except as set forth in the next paragraph.
As set forth on Exhibit T hereto, for so long as the Trust is
subject to the Exchange Act reporting requirements, no later than noon Eastern
Standard Time on the 2nd Business Day after the occurrence of a Reportable
Event, the parties to this Agreement shall be required to provide to the
Depositor and the Securities Administrator, in XXXXX-compatible format, or in
such other form as otherwise agreed upon by the Securities Administrator and
such party, to the extent known by such applicable parties, any Form 8-K
Disclosure Information, if applicable, together with an Additional Disclosure
Notification. The Depositor will be responsible for all reasonable fees and
expenses assessed or incurred by the Securities Administrator in connection with
including any Form 8-K Disclosure Information on Form 8-K pursuant to this
paragraph, including the conversion of any such disclosure into an
XXXXX-compatible format. 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.
(g) The Securities Administrator shall prepare and forward
electronically a draft copy of the Form 8-K to the Depositor sufficiently far in
advance of, but in no event later than noon (Eastern Standard Time) on the 3rd
Business Day after a Reportable Event, to permit the Depositor to review and
verify such Form 8-K. Promptly, but no later than the close of business on the
third Business Day after the Reportable Event, the Depositor shall notify the
Securities Administrator in writing (which may be furnished electronically) of
any changes to or approval of such Form 8-K. In the absence of receipt of any
written changes or approval, the Securities Administrator shall be entitled to
assume that such Form 8-K is in final form and the Securities Administrator may
proceed with the execution and filing of the Form 8-K. A duly authorized
representative of the Master Servicer shall sign each Form 8-K. 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
8.12(e)(ii). Promptly (but in any case within one Business Day) after filing
with the Commission, the Securities Administrator will, make available on its
internet website a final executed copy of each Form 8-K prepared and filed by
the Securities Administrator. The Depositor acknowledges that the performance by
the Securities Administrator and the Master Servicer of their duties under this
Section 8.12(g) related to the timely preparation and filing of Form 8-K is
contingent, in part, upon the Servicer, the Depositor and any other Person
obligated to provide Form 8-K Disclosure Information as set forth on Exhibit T
hereto, observing all applicable deadlines in the performance of their duties
under this Section 8.12(f). Neither the Master Servicer nor the Securities
Administrator shall have any liability for any loss, expense, damage or claim
arising out of or with respect to any failure to properly prepare, execute
and/or timely file such Form 8-K, where such failure results from the Securities
Administrator's or the Master Servicer's inability or failure to obtain or
receive, on a timely basis, any information from any party hereto (other than
the Securities Administrator or the Master Servicer or any Subcontractor
utilized by the Securities Administrator or the Master Servicer) needed to
prepare, execute or file such Form 8-K, not resulting from its own negligence,
bad faith or willful misconduct.
(h) Neither the Master Servicer nor the Securities Administrator
shall have any liability for any loss, expense, damage or claim arising out of
or resulting from (i) the accuracy or inaccuracy of any Additional Form 10-D
Disclosure, Additional Form 10-K Disclosure or Form 8-K Disclosure Information
(excluding any information therein provided by the Securities Administrator or
any Subcontractor utilized by the Securities Administrator) provided to the
Securities Administrator in connection with the preparation of Forms 10-D, 10-K
and 8-K pursuant to this Section 8.12, or (ii) the failure of the Depositor to
timely execute and return for filing any Forms 10-D, 10-K and 8-K required to be
filed by the Securities Administrator pursuant to this Section 8.12, in either
case, not resulting from the Securities Administrator's own negligence, bad
faith or misconduct.
Section 8.13 Tax Treatment of Upper-Tier CarryForward Amounts, Basis
Risk CarryForward Amounts and Class IO Shortfalls; Tax Classification of the
Supplemental Interest Trust, Excess Reserve Fund Account, Swap Account and the
Interest Rate Swap Agreement. For federal income tax purposes, the Securities
Administrator shall treat the Supplemental Interest Trust, the Excess Reserve
Fund Account and the Swap Account as beneficially owned by the holders of the
Class X Certificates and shall treat such portion of the Trust Fund as a grantor
trust, within the meaning of subpart E, Part I of subchapter J of the Code. The
Securities Administrator shall treat the rights that each Class of LIBOR
Certificates has to receive payments of Basis Risk Carry Forward Amounts, and to
the extent not paid from the Excess Reserve Fund Account, Basis Risk Carry
Forward Amounts and, without duplication, Upper-Tier CarryForward Amounts from
the Swap Account (together with Basis Risk Carry Forward Amounts from the Excess
Reserve Fund Account), subject to the obligation to pay Class IO Shortfalls, as
rights and obligations under a notional principal contract between the Class X
Certificateholder and each such Class and beneficially owned by each such Class
through the Grantor Trust. Accordingly, each Class of Certificates (excluding
the Class X, Class P, the Class R and the Class RX Certificates) will be
comprised of two components - an Upper-Tier Regular Interest and an interest in
a notional principal contract, and the Class X Certificates will be comprised of
the following components: three Class X REMIC Regular Interests (the Class X
Interest, the Class PF-IO Interest and the Class IO Interest), an interest in
the Excess Reserve Fund Account (including the Interest Rate Cap Agreement),
subject to obligation to pay Net Swap Payments, Swap Termination Payments, Basis
Risk Carry Forward Amounts, ownership of the Swap Account and the Interest Rate
Swap Agreement, subject to the obligation to pay Basis Risk Carry Forward
Amounts and, without duplication, Upper-Tier CarryForward Amounts, and the right
to receive Class IO Shortfalls. The Securities Administrator shall allocate the
issue price for a Class of Certificates among the respective components for
purposes of determining the issue price of the Upper-Tier Regular Interest
component based on information received from the Depositor. Unless otherwise
advised by the Depositor in writing, for federal income tax purposes, the
Securities Administrator is hereby directed to assign a value of zero to the
right of each Holder of an LIBOR Certificate to receive the related Basis Risk
Carry Forward Amounts and, without duplication, the related Upper-Tier
CarryForward Amounts for purposes of allocating the purchase price of an LIBOR
Certificate acquired by an initial Holder thereof between such right and the
related Upper-Tier Regular Interest.
Holders of LIBOR Certificates shall also be treated as having agreed
to pay, on each Distribution Date, to the Holders of the Class X Certificates an
aggregate amount equal to the excess, if any, of (i) Net Swap Payments and Swap
Termination Payments (other than Defaulted Swap Termination Payments) over (ii)
the sum of amounts payable on the Class X Interest available for such payments
and amounts payable on the Class IO Interest (such excess, a "Class IO
Shortfall"), first from interest and then from principal distributable on the
LIBOR Certificates. A Class IO Shortfall payable from interest collections shall
be allocated pro rata among such LIBOR Certificates based on the amount of
interest otherwise payable to such Class of LIBOR Certificates, and a Class IO
Shortfall payable from principal collections shall be allocated in reverse
sequential order beginning with the most subordinate Class of LIBOR Certificates
then Outstanding.
Any payments of Class IO Shortfalls shall be treated for tax
purposes as having been received by the Holders of such Class of LIBOR
Certificates in respect of the corresponding Upper-Tier Regular Interest and as
having been paid by such Holders to the Holders of the Class X Certificates
through the Swap Account. In the event any class of Upper-Tier Regular Interest
corresponding to a class of LIBOR Certificates is subject to the Upper-Tier
REMIC WAC Rate, and such rate exceeds the applicable Pass-Through Rate of the
Corresponding Class of Certificates as a result of a Swap Termination Payment,
such excess shall be deemed first paid to the related Upper-Tier Regular
Interest and then paid to the Class X Certificates in a manner analogous to
Class IO Shortfalls.
Section 8.14 Interest Rate Swap Agreement. The Securities
Administrator is hereby authorized and directed to execute and deliver the
Interest Rate Swap Agreement not in its individual capacity but solely on behalf
of the Supplemental Interest Trust of the Trust and to acknowledge the
provisions thereof. The Securities Administrator is directed to administer the
Interest Rate Swap Agreement in accordance with the terms thereof and hereof.
The Securities Administrator shall not enter into any amendment to the Interest
Rate Swap Agreement other than pursuant to the terms thereof. In the event that
the Swap Provider fails to make a payment as required pursuant to the Interest
Rate Swap Agreement, the Securities Administrator shall make a demand for such
payment from the guarantor of the Interest Rate Swap Agreement.
Section 8.15 Interest Rate Cap Agreement. The Securities
Administrator is hereby authorized and directed to execute and deliver the
Interest Rate Cap Agreement not in its individual capacity but solely on behalf
of the Supplemental Interest Trust of the Trust and to acknowledge the
provisions thereof. The Securities Administrator is directed to administer the
Interest Rate Cap Agreement in accordance with the terms thereof and hereof. The
Securities Administrator shall not enter into any amendment to the Interest Rate
Cap Agreement other than pursuant to the terms thereof. In the event that the
Cap Provider fails to make a payment as required pursuant to the Interest Rate
Cap Agreement, the Securities Administrator shall make a demand for such payment
from the guarantor of the Interest Rate Cap Agreement.
ARTICLE IX
ADMINISTRATION OF THE MORTGAGE LOANS BY THE MASTER SERVICER
Section 9.01 Duties of the Master Servicer; Enforcement of the
Servicer's Obligations. (a) In addition to the other duties of the Master
Servicer set forth in this Agreement, the Master Servicer, on behalf of the
Trustee, the Securities Administrator, the Depositor and the Certificateholders,
shall monitor the performance of the Servicer under this Agreement, and (except
as set forth below) shall use its reasonable good faith efforts to cause the
Servicer to duly and punctually perform their duties and obligations hereunder
as applicable. Upon the occurrence of an Event of Default of which a Responsible
Officer of the Master Servicer has actual knowledge, the Master Servicer shall
promptly notify the Securities Administrator and the Trustee and shall specify
in such notice the action, if any, the Master Servicer plans to take in respect
of such default. So long as an Event of Default shall occur and be continuing,
the Master Servicer shall take the actions specified in Article VII.
(b) The Master Servicer shall bear the costs of monitoring the
Servicer as required hereunder. The costs associated with (i) termination of the
Servicer, (ii) the appointment of a successor Servicer or (iii) the transfer to
and assumption of, the servicing by the Master Servicer shall be paid by the
terminated Servicer. In the event the full costs associated with the transition
of servicing responsibilities to the Master Servicer are not paid for by the
predecessor or successor Servicer (provided such successor Servicer is not the
Master Servicer), such costs shall be paid by the Trust.
(c) If the Master Servicer assumes the servicing with respect to any
of the Mortgage Loans, it will not assume liability for the representations and
warranties of the Servicer it replaces or for any errors or omissions of the
Servicer.
(d) Neither the Depositor nor the Securities Administrator shall
consent to the assignment by the Servicer of the Servicer's rights and
obligations under the Agreement without the prior written consent of the Master
Servicer and the Depositor, which consent, in the case of the Depositor, shall
not be unreasonably withheld.
Section 9.02 Maintenance of Fidelity Bond and Errors and Omissions
Insurance. (a) The Master Servicer, at its expense, shall maintain in effect a
blanket fidelity bond and an errors and omissions insurance policy, affording
coverage with respect to all directors, officers, directors, 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. The
errors and omissions insurance policy and the fidelity bond shall be in such
form and amount generally acceptable for entities serving as master servicers or
trustees.
Section 9.03 Representations and Warranties of the Master Servicer.
(a) The Master Servicer hereby represents and warrants to the Depositor, the
Securities Administrator and the Trustee, for the benefit of the
Certificateholders, as of the Closing Date that:
(i) it is a banking association organized under the laws of the
United States of America, validly existing and in good standing under the
laws of the United States of America, and as Master Servicer has full
power and authority to transact any and all business contemplated by this
Agreement and to execute, deliver and comply with its obligations under
the terms of this Agreement, the execution, delivery and performance of
which have been duly authorized by all necessary corporate action on the
part of the Master Servicer;
(ii) the execution and delivery of this Agreement by the Master
Servicer and its performance and compliance with the terms of this
Agreement will not (A) violate the Master Servicer's charter or bylaws,
(B) violate any law or regulation or any administrative decree or order to
which it is subject or (C) constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, or
result in the breach of, any material contract, agreement or other
instrument to which the Master Servicer is a party or by which it is bound
or to which any of its assets are subject, which violation, default or
breach would materially and adversely affect the Master Servicer's ability
to perform its obligations under this Agreement;
(iii) this Agreement constitutes, assuming due authorization,
execution and delivery hereof by the other respective parties hereto, a
legal, valid and binding obligation of the Master Servicer, enforceable
against it in accordance with the terms hereof, except as such enforcement
may be limited by bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the enforcement of creditors' rights in general, and
by general equity principles (regardless of whether such enforcement is
considered in a proceeding in equity or at law);
(iv) the Master Servicer is not in default with respect to any order
or decree of any court or any order or regulation of any federal, state,
municipal or governmental agency to the extent that any such default would
materially and adversely affect its performance hereunder;
(v) the Master Servicer is not a party to or bound by any agreement
or instrument or subject to any charter provision, bylaw or any other
corporate restriction or any judgment, order, writ, injunction, decree,
law or regulation that may materially and adversely affect its ability as
Master Servicer to perform its obligations under this Agreement or that
requires the consent of any third person to the execution of this
Agreement or the performance by the Master Servicer of its obligations
under this Agreement;
(vi) no litigation is pending or, to the best of the Master
Servicer's knowledge, threatened against the Master Servicer which would
prohibit its entering into this Agreement or performing its obligations
under this Agreement;
(vii) [Reserved];
(viii) no consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Master Servicer of or compliance by the Master Servicer
with this Agreement or the consummation of the transactions contemplated
by this Agreement, except for such consents, approvals, authorizations and
orders (if any) as have been obtained; and
(ix) the consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Master Servicer.
(b) It is understood and agreed that the representations and
warranties set forth in this Section shall survive the execution and delivery of
this Agreement. The Master Servicer shall indemnify the Depositor, Securities
Administrator, the Trustee and the Trust and hold them harmless against any
loss, damages, penalties, fines, forfeitures, reasonable legal fees and related
costs, judgments, and other reasonable costs and expenses resulting from any
claim, demand, defense or assertion based on or grounded upon, or resulting
from, a material breach of the Master Servicer's representations and warranties
contained in Section 9.03(a) above. It is understood and agreed that the
enforcement of the obligation of the Master Servicer set forth in this Section
9.03 to indemnify the Depositor, Securities Administrator, the Trustee and the
Trust constitutes the sole remedy of the Depositor and the Trustee, respecting a
breach of the foregoing representations and warranties. Such indemnification
shall survive any termination of the Master Servicer as Master Servicer
hereunder and any termination of this Agreement.
Any cause of action against the Master Servicer relating to or
arising out of the breach of any representations and warranties made in this
Section shall accrue upon discovery of such breach by either the Depositor, the
Master Servicer, Securities Administrator or the Trustee or notice thereof by
any one of such parties to the other parties.
Section 9.04 Master Servicer Events of Default. Each of the
following shall constitute a "Master Servicer Event of Default":
(a) any failure by the Master Servicer to remit to the Securities
Administrator for deposit in the Distribution Account any payment received by it
from the Servicer or required to be made by the Master Servicer under the terms
of this Agreement which continues unremedied for a period of two (2) Business
Days after the date upon which written notice of such failure, requiring the
same to be remedied, shall have been given to the Master Servicer by any other
party hereto;
(b) failure by the Master Servicer to duly observe or perform, in
any material respect, any other covenants, obligations or agreements of the
Master Servicer as set forth in this Agreement which failure 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 Master Servicer by the Trustee or to the Master Servicer and Trustee by
the holders of Certificates evidencing at least 25% of the Voting Rights;
provided that the thirty (30) day cure period shall not apply so long as the
Depositor is required to file any Forms 8-K, 10-D and 10-K required by the
Exchange Act with respect to the Trust Fund, the failure to comply with the
requirements set forth in Section 8.12, for which the grace period shall not
exceed the lesser of ten (10) calendar days or such period in which any
applicable Form 8-K, 10-D and 10-K required by the Exchange Act can be timely
filed (without taking into account any extensions);
(c) a decree or order of a court or agency or supervisory authority
having jurisdiction for the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshaling of
assets and liabilities or similar proceedings, or 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 sixty (60) days;
(d) the Master 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 Master Servicer or relating to all or
substantially all of its property;
(e) the Master Servicer shall admit in writing its inability to pay
its debts 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 for
three (3) Business Days;
(f) except as otherwise set forth herein, the Master Servicer
attempts to assign this Agreement or its responsibilities hereunder or to
delegate its duties hereunder (or any portion thereof) without the consent of
the Trustee, Securities Administrator and the Depositor; or
(g) the indictment of the Master Servicer for the taking of any
action by the Master Servicer, any employee thereof, any Affiliate or any
director or employee thereof that constitutes fraud or criminal activity in the
performance of its obligations under this Agreement, in each case, where such
indictment materially and adversely affects the ability of the Master Servicer
to perform its obligations under this Agreement (subject to the condition that
such indictment is not dismissed within ninety (90) days).
In each and every such case, so long as a Master Servicer Event of
Default shall not have been remedied, in addition to whatever rights the
Securities Administrator may have at law or equity to damages, including
injunctive relief and specific performance, the Securities Administrator, by
notice in writing to the Master Servicer may, and at the direction of the
Holders of Certificates representing at least a majority of the Voting Rights,
shall, terminate with cause all the rights and obligations of the Master
Servicer under this Agreement.
Upon receipt by the Master Servicer of such written notice, all
authority and power of the Master Servicer under this Agreement, shall pass to
and be vested in any successor master servicer appointed hereunder which accepts
such appointments. Upon written request from the Trustee or the Depositor, the
Master Servicer shall prepare, execute and deliver to the successor entity
designated by the Trustee any and all documents and other instruments related to
the performance of its duties hereunder as the Master Servicer and place in such
successor's possession all such documents with respect to the master servicing
of the Mortgage Loans and do or cause to be done all other acts or things
necessary or appropriate to effect the purposes of such notice of termination,
at the Master Servicer's sole expense. The Master Servicer shall cooperate with
the Trustee and such successor master servicer in effecting the termination of
the Master Servicer's responsibilities and rights hereunder, including without
limitation, the transfer to such successor master servicer for administration by
it of all cash amounts which shall at the time be credited to the Distribution
Account or are thereafter received with respect to the Mortgage Loans.
Section 9.05 Waiver of Default. By a written notice, the Trustee
may, with the consent of a Holders of Certificates evidencing at least a
majority of the Voting Rights waive any default by the Master Servicer in the
performance of its obligations hereunder and its consequences. Upon any waiver
of a past default, such default shall cease to exist, and any Master Servicer
Event of Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent
or other default or impair any right consequent thereon except to the extent
expressly so waived.
Section 9.06 Successor to the Master Servicer. Upon termination of
the Master Servicer's responsibilities and duties under this Agreement, the
Trustee shall appoint a successor, which shall succeed to all rights and assume
all of the responsibilities, duties and liabilities of the Master Servicer under
this Agreement, except liabilities incurred by the terminated Master Servicer
(unless such terminated Master Servicer is the Trustee) for which the terminated
Master Servicer shall still be responsible. Any successor shall be a Xxxxxx Xxx
and Xxxxxxx Mac approved servicer in good standing and acceptable to the
Depositor and the Rating Agencies. 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 as it and such successor shall
agree; provided, however, that in no event shall the master servicing fee paid
to such successor master servicer exceed the Securities Administrator and Master
Servicer Fee paid to the Master Servicer hereunder. In the event that the Master
Servicer's duties, responsibilities and liabilities under this Agreement are
terminated, the Master Servicer shall continue to discharge its duties and
responsibilities hereunder until the effective date of such termination 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 of its successor. The termination of the Master Servicer
shall not become effective until a successor shall be appointed pursuant hereto
and shall in no event (i) relieve the Master Servicer of responsibility for the
representations and warranties made pursuant to Section 9.03(a) hereof and the
remedies available to the Trustee under Section 9.03(b) hereof, it being
understood and agreed that the provisions of Section 9.03 hereof shall be
applicable to the Master Servicer notwithstanding any such sale, assignment,
resignation or termination of the Master Servicer or the termination of this
Agreement; or (ii) affect the right of the Master Servicer to receive payment
and/or reimbursement of any amounts accruing to it hereunder prior to the date
of termination (or during any transition period in which the Master Servicer
continues to perform its duties hereunder prior to the date the successor master
servicer fully assumes its duties).
If no successor Master Servicer has accepted its appointment within
90 days of the time the Trustee receives the resignation of the Master Servicer,
the Trustee shall become the successor Master Servicer in all respects under
this Agreement until another successor Master Servicer is appointed, and shall
have all the rights and powers and be subject to all the responsibilities,
duties and liabilities, except liabilities incurred by the terminated Master
Servicer (unless such terminated Master Servicer is the Trustee) for which the
terminated Master Servicer shall still be responsible, including the obligation
to make P&I Advances; provided, however, that any failure to perform any duties
or responsibilities caused by the Master Servicer's failure to provide
information required by this Agreement shall not be considered a default by the
Trustee hereunder. In the Trustee's capacity as such successor Master Servicer,
the Trustee shall have the same limitations on liability herein granted to the
Master Servicer. As compensation therefor, the Trustee shall be entitled to
receive the compensation, reimbursement and indemnities otherwise payable to the
Master Servicer, including the fees and other amounts payable pursuant to
Section 9.07 hereof.
Any successor master servicer appointed as provided herein, shall
execute, acknowledge and deliver to the predecessor Master Servicer and to the
Trustee an instrument accepting such appointment, wherein the successor shall
make the representations and warranties set forth in Section 9.03 hereof, and
whereupon such successor shall become fully vested with all of the rights,
powers, duties, responsibilities, obligations and liabilities of the Master
Servicer, with like effect as if originally named as a party to this Agreement.
Any termination or resignation of the Master Servicer or termination of this
Agreement shall not affect any claims that the Trustee may have against the
Master Servicer arising out of the Master Servicer's actions or failure to act
prior to any such termination or resignation or in connection with the Trustee's
assumption of such obligations, duties and responsibilities.
Upon a successor's acceptance of appointment as such, the Master
Servicer shall notify by mail the Trustee of such appointment.
Section 9.07 Compensation of the Master Servicer. As compensation
for its activities under this Agreement, the Master Servicer shall be paid the
Securities Administrator and Master Servicer Fee.
Section 9.08 Merger or Consolidation. Any Person into which the
Master Servicer may be merged or consolidated, or any Person resulting from any
merger, conversion, other change in form or consolidation to which the Master
Servicer shall be a party, or any Person succeeding to the business of the
Master Servicer, shall be the successor to the Master 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 resulting Person to the Master Servicer
shall (i) be a Person (or have an Affiliate) that is qualified and approved to
service mortgage loans for Xxxxxx Xxx and Xxxxxxx Mac (provided further that a
successor Master Servicer that satisfies subclause (i) through an Affiliate
agrees to service the Mortgage Loans in accordance with all applicable Xxxxxx
Mae and Xxxxxxx Mac guidelines) and (ii) have a net worth of not less than
$25,000,000. In connection with the succession to the Master Servicer under this
Agreement by any Person (i) into which the Master Servicer may be merged or
consolidated, or (ii) which may be appointed as a successor to the Master
Servicer, the Master Servicer shall notify the Securities Administrator and the
Depositor of such succession or appointment and shall furnish to the Securities
Administrator and the Depositor, all information reasonably necessary for the
Securities Administrator to accurately and timely report, pursuant to Section
8.12(g), the event under Item 6.02 of Form 8-K pursuant to the Exchange Act (if
such reports under the Exchange Act are required to be filed under the Exchange
Act).
Section 9.09 Resignation of the Master Servicer. Except as otherwise
provided in Sections 9.08 and 9.10 hereof, the Master Servicer shall not resign
from the obligations and duties hereby imposed on it unless the Master
Servicer's duties hereunder are no longer permissible under applicable law or
are in material conflict by reason of applicable law with any other activities
carried on by it and cannot be cured. Any such determination permitting the
resignation of the Master Servicer shall be evidenced by an Opinion of Counsel
that shall be independent to such effect delivered to the Trustee. No such
resignation shall become effective until the Trustee shall have assumed, or a
successor master servicer satisfactory to the Trustee and the Depositor shall
have assumed, the Master Servicer's responsibilities and obligations under this
Agreement. Notice of such resignation shall be given promptly by the Master
Servicer and the Depositor to the Trustee.
If at any time, Xxxxx Fargo Bank, National Association, as Master
Servicer, resigns under this Section 9.09, or is removed as Master Servicer
pursuant to Section 9.04, then at such time Xxxxx Fargo Bank, National
Association, shall also resign (and shall be entitled to resign) as Securities
Administrator under this Agreement.
Section 9.10 Assignment or Delegation of Duties by the Master
Servicer. Except as expressly provided herein, the Master Servicer shall not
assign or transfer any of its rights, benefits or privileges hereunder to any
other Person, or delegate to or subcontract with, or authorize or appoint any
other Person to perform any of the duties, covenants or obligations to be
performed by the Master Servicer; provided, however, that the Master Servicer
shall have the right with the prior written consent of the Depositor (which
shall not be unreasonably withheld or delayed), and upon delivery to the
Trustee, the Securities Administrator and the Depositor of a letter from each
Rating Agency to the effect that such action shall not result in a downgrade of
the ratings assigned to any of the Certificates, to delegate or assign to or
subcontract with or authorize or appoint any qualified Person to perform and
carry out any duties, covenants or obligations to be performed and carried out
by the Master Servicer hereunder, provided, further, that the Master Servicer
complies with Section 3.02(e) as if the Master Servicer were a "Servicer"
pursuant to that Section. Notice of such permitted assignment shall be given
promptly by the Master Servicer to the Depositor, the Securities Administrator
and the Trustee. If, pursuant to any provision hereof, the duties of the Master
Servicer are transferred to a successor master servicer, the entire compensation
payable to the Master Servicer pursuant hereto shall thereafter be payable to
such successor master servicer but in no event shall the fee payable to the
successor master servicer exceed that payable to the predecessor master
servicer.
Section 9.11 Limitation on Liability of the Master Servicer. Neither
the Master Servicer, nor any of the directors, officers, employees or agents of
the Master Servicer shall be under any liability to the Trustee, Securities
Administrator, the Servicer or the Certificateholders for any action taken or
for refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Master Servicer or any such person against any liability
that would otherwise be imposed by reason of willful malfeasance, bad faith or
negligence in the performance of its duties or by reason of reckless disregard
for its obligations and duties under this Agreement. The Master Servicer and any
director, officer, employee or agent of the Master Servicer may rely in good
faith on any document prima facie properly executed and submitted by any Person
respecting any matters arising hereunder. The Master Servicer shall be under no
obligation to appear in, prosecute or defend any legal action that is not
incidental to its duties as Master Servicer with respect to the Mortgage Loans
under this Agreement and that in its opinion may involve it in any expenses or
liability; provided, however, that the Master Servicer may in its sole
discretion undertake any such action that it may deem necessary or desirable in
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, shall
be liabilities of the Trust Fund, and the Master Servicer shall be entitled to
be reimbursed therefor out of the Master Servicer Account in accordance with the
provisions of Section 9.07 and Section 9.12.
The Master Servicer shall not be liable for any acts or omissions of
the Servicer except to the extent that damages or expenses are incurred as a
result of such act or omissions and such damages and expenses would not have
been incurred but for the negligence, willful malfeasance, bad faith or
recklessness of the Master Servicer in supervising, monitoring and overseeing
the obligations of the Servicer as required under this Agreement.
Section 9.12 Indemnification; Third Party Claims. The Master
Servicer agrees to indemnify the Depositor, the Unaffiliated Seller, the
Servicer, the Trustee, the Custodian, the Securities Administrator and the Trust
Fund, and hold them harmless against any and all claims, losses, penalties,
fines, forfeitures, legal fees and related costs, judgments, and any other
costs, liability, fees and expenses that the Depositor, the Unaffiliated Seller,
the Servicer, the Trustee, the Custodian, the Securities Administrator or the
Trust Fund may sustain as a result of the Master Servicer's willful malfeasance,
bad faith or negligence in the performance of its duties hereunder or by reason
of its reckless disregard for its obligations and duties under this Agreement,
including, without limitation, its obligations under Sections 3.02(e), 3.22,
3.23 or 8.12, including without limitation any failure by the Master Servicer to
identify any Subcontractor engaged by the Master Servicer or any of its
Subcontractors "participating in the servicing function" within the meaning of
Item 1122 of Regulation AB, notwithstanding any transfer to a successor master
servicer or securities administrator, as the case may be. The Depositor, the
Unaffiliated Seller, Securities Administrator, the Servicer, the Custodian and
the Trustee shall immediately notify the Master Servicer if a claim is made by a
third party with respect to this Agreement or the Mortgage Loans which would
entitle the Depositor, the Unaffiliated Seller, the Servicer, the Trustee, the
Securities Administrator, the Custodian or the Trust Fund to indemnification
under this Section 9.12, whereupon the Master Servicer shall assume 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 them in respect of such claim.
The Master Servicer agrees to indemnify and hold harmless the
Trustee from and against any and all claims, losses, penalties, fines,
forfeitures, legal fees and related costs, judgments, and any other costs,
liability, fees and expenses (including reasonable attorneys' fees) that the
Trustee may sustain as a result of such respective liability or obligations of
the Master Servicer and in connection with the Trustee's assumption (not
including the Trustee's performance, except to the extent that costs or
liability of the Trustee are created or increased as a result of negligent or
wrongful acts or omissions of the Master Servicer prior to its replacement as
Master Servicer) of the Master Servicer's obligations, duties or
responsibilities under such agreement.
The Trust Fund agrees to indemnify the Master Servicer and hold it
harmless against any and all claims, losses, penalties, fines, forfeitures,
legal fees and related costs, judgments, and any other costs, liabilities, fees
and expenses that the Master Servicer, as applicable may incur or sustain in
connection with, arising out of or related to this Agreement or the
Certificates, except to the extent that any such loss, liability or expense is
related to (i) a material breach of the Master Servicer's representations and
warranties in this Agreement or (ii) the Master Servicer's willful malfeasance,
bad faith or negligence or by reason of its reckless disregard of its duties and
obligations under any such agreement; provided that any such loss, liability or
expense constitutes an "unanticipated expense incurred by the REMIC" within the
meaning of Treasury Regulations Section 1.860G-1(b)(3)(ii). The Master Servicer
shall be entitled to reimbursement for any such indemnified amount from funds on
deposit in the Distribution Account.
The Unaffiliated Seller agrees to indemnify the Master Servicer and
hold it harmless against any and all claims, losses, penalties, fines,
forfeitures, legal fees and related costs, judgments, and any other costs,
liabilities, fees and expenses that the Master Servicer may incur or sustain in
connection with, arising out of or related to a material breach of the
Unaffiliated Seller's repurchase obligations under Section 2.03(d).
ARTICLE X
CONCERNING THE SECURITIES ADMINISTRATOR
Section 10.01 Duties of Securities Administrator. The Securities
Administrator shall undertake to perform such duties and only such duties as are
specifically set forth in this Agreement.
The Securities Administrator, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Securities Administrator that are specifically
required to be furnished pursuant to any provision of this Agreement shall
examine them to determine whether they are in the form required by this
Agreement; provided, however, that the Securities Administrator shall not be
responsible for the accuracy or content of any such resolution, certificate,
statement, opinion, report, document, order or other instrument. If any such
instrument is found not to conform in any material respect to the requirements
of this Agreement, the Securities Administrator shall notify the
Certificateholders of such non conforming instrument in the event the Securities
Administrator, after so requesting, does not receive a satisfactorily corrected
instrument.
No provision of this Agreement shall be construed to relieve 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) the duties and obligations of the Securities Administrator shall
be determined solely by the express provisions of this Agreement, the
Securities Administrator shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this
Agreement against the Securities Administrator and the Securities
Administrator 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 Securities Administrator and conforming to
the requirements of this Agreement which it believed in good faith to be
genuine and to have been duly executed by the proper authorities
respecting any matters arising hereunder;
(ii) the Securities Administrator shall not be liable for an error
of judgment made in good faith by a Responsible Officer or Responsible
Officers of the Securities Administrator, unless it shall be conclusively
determined by a court of competent jurisdiction, such determination no
longer subject to appeal, that the Securities Administrator was negligent
in ascertaining the pertinent facts;
(iii) the Securities Administrator shall not be liable with respect
to any action or inaction taken, suffered or omitted to be taken by it in
good faith in accordance with the direction of the Holders of Certificates
evidencing not less than 25% of the Voting Rights of Certificates relating
to the time, method and place of conducting any proceeding for any remedy
available to the Securities Administrator, or exercising or omitting to
exercise any trust or power conferred upon the Securities Administrator
under this Agreement; and
(iv) the Securities Administrator shall not be accountable, shall
have no liability and makes no representation as to any acts or omissions
hereunder of the Master Servicer or the Trustee.
Section 10.02 Certain Matters Affecting the Securities
Administrator. Except as otherwise provided in Section 10.01:
(i) the Securities Administrator may request and conclusively rely
upon and shall be fully protected in acting or refraining from acting upon
any resolution, Officer's Certificate, certificate 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 and the Securities Administrator shall have no
responsibility to ascertain or confirm the genuineness of any signature of
any such party or parties;
(ii) the Securities Administrator may consult with counsel,
financial advisers or accountants and the advice of any such counsel,
financial advisers or accountants and any advice or Opinion of Counsel
shall be full and complete authorization and protection in respect of any
action taken or suffered or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(iii) the Securities Administrator shall not be liable for any
action or inaction 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;
(iv) the Securities Administrator shall not 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 so to do by Holders of Certificates evidencing not
less than 25% of the Voting Rights allocated to each Class of
Certificates; provided, however, that if the payment within a reasonable
time to the Securities Administrator of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is, in the
opinion of the Securities Administrator, not reasonably assured to the
Securities Administrator by the security afforded to it by the terms of
this Agreement, the Securities Administrator may require reasonable
indemnity against such expense or liability as a condition to so
proceeding. Nothing in this clause (iv) shall derogate from the obligation
of the Master Servicer to observe any applicable law prohibiting
disclosure of information regarding the Mortgagors, provided that the
Master Servicer shall have no liability for disclosure required by this
Agreement;
(v) the Securities Administrator may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents or attorneys or a custodian and the Securities
Administrator shall not be responsible for any misconduct or negligence on
the part of any such agent, attorney or custodian appointed by the
Securities Administrator with due care;
(vi) the Securities Administrator shall not be required to risk or
expend its own funds or otherwise incur any financial liability in the
performance of any of its duties or in the exercise of any of its rights
or powers hereunder if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or
liability is not assured to it, and none of the provisions contained in
this Agreement shall in any event require the Securities Administrator to
perform, or be responsible for the manner of performance of, any of the
obligations of the Master Servicer under this Agreement;
(vii) the Securities Administrator shall be under no obligation to
exercise any of the trusts, rights or powers vested in it by 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 Securities Administrator
reasonable security or indemnity satisfactory to the Securities
Administrator against the costs, expenses and liabilities which may be
incurred therein or thereby;
(viii) the Securities Administrator shall have no obligation to
appear in, prosecute or defend any legal action that is not incidental to
its duties hereunder and which in its opinion may involve it in any
expense or liability; provided, however, that the Securities Administrator
may in its discretion undertake any such action that it may deem necessary
or desirable in respect of this Agreement and the rights and duties of the
parties hereto and the interests of the Trustee, the Securities
Administrator and the Certificateholders hereunder. In such event, the
legal expenses and costs of such action and any liability resulting
therefrom shall be expenses, costs and liabilities of the Trust Fund, and
the Securities Administrator shall be entitled to be reimbursed therefor
out of the Distribution Account;
(ix) the right of the Securities Administrator to perform any
discretionary act enumerated in this Agreement shall not be construed as a
duty, and the Securities Administrator shall not be answerable for other
than its negligence, bad faith or willful misconduct in the performance of
such act; and
(x) the Securities Administrator shall not be required to give any
bond or surety in respect of the execution of the Trust Fund created
hereby or the powers granted hereunder.
The Securities Administrator shall have no duty (A) to see to any
recording, filing, or depositing of this Agreement or any agreement referred to
herein or any financing statement or continuation statement evidencing a
security interest, or to see to the maintenance of any such recording or filing
or depositing or to any rerecording, refiling or redepositing thereof, (B) to
see to the provision of any insurance or (C) to see to the payment or discharge
of any tax, assessment, or other governmental charge or any lien or encumbrance
of any kind owing with respect to, assessed or levied against, any part of the
Trust Fund other than from funds available in the Distribution Account.
Section 10.03 Securities Administrator Not Liable for Certificates
or Mortgage Loans. The recitals contained herein and in the Certificates shall
not be taken as the statements of the Securities Administrator, and the
Securities Administrator assumes no responsibility for their correctness. The
Securities Administrator makes no representations as to the validity or
sufficiency of this Agreement or of the Certificates or of any Mortgage Loan or
related document other than with respect to the Securities Administrator's
execution and authentication of the Certificates. The Securities Administrator
shall not be accountable for the use or application by the Depositor or the
Master Servicer of any funds paid to the Depositor or the Master Servicer in
respect of the Mortgage Loans or deposited in or withdrawn from the Distribution
Account by the Depositor or the Master Servicer.
Section 10.04 Securities Administrator May Own Certificates. The
Securities Administrator in its individual or any other capacity may become the
owner or pledgee of Certificates and may transact business with the parties
hereto and their Affiliates with the same rights as it would have if it were not
the Securities Administrator.
Section 10.05 Securities Administrator's Fees and Expenses. The
Securities Administrator shall be entitled to the investment income earned on
amounts in the Distribution Account. The Securities Administrator and any
director, officer, employee, agent or "control person" within the meaning of the
Securities Act of 1933, as amended, and the Securities Exchange of 1934, as
amended ("Control Person"), of the Securities Administrator shall be indemnified
by the Trust and held harmless against any loss, liability or expense (including
reasonable attorney's fees) (i) incurred in connection with any claim or legal
action relating to (a) this Agreement, the Interest Rate Swap Agreement or the
Interest Rate Cap Agreement, (b) the Mortgage Loans or (c) the Certificates,
other than any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of any of the Securities
Administrator's duties hereunder, (ii) incurred in connection with the
performance of any of the Securities Administrator's duties hereunder or under
such other agreements, other than any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or negligence in the performance of any
of the Securities Administrator's duties hereunder or (iii) incurred by reason
of any action of the Securities Administrator taken at the direction of the
Certificateholders, provided that any such loss, liability or expense
constitutes an "unanticipated expense incurred by the REMIC" within the meaning
of Treasury Regulations Section 1.860G 1(b)(3)(ii). Such indemnity shall survive
the termination of this Agreement or the resignation or removal of the
Securities Administrator hereunder. Without limiting the foregoing, and except
for any such expense, disbursement or advance as may arise from the Securities
Administrator's negligence, bad faith or willful misconduct, or which would not
be an "unanticipated expense" within the meaning of the second preceding
sentence, the Securities Administrator shall be reimbursed by the Trust for all
reasonable expenses, disbursements and advances incurred or made by the
Securities Administrator in accordance with any of the provisions of this
Agreement with respect to: (A) the reasonable compensation and the expenses and
disbursements of its counsel not associated with the closing of the issuance of
the Certificates, (B) the reasonable compensation, expenses and disbursements of
any accountant, engineer, appraiser or other agent that is not regularly
employed by the Securities Administrator, to the extent that the Securities
Administrator must engage such Persons to perform acts or services hereunder and
(C) printing and engraving expenses in connection with preparing any Definitive
Certificates. The Trust shall fulfill its obligations under this paragraph from
amounts on deposit from time to time in the Distribution Account. The Securities
Administrator 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.
The Securities Administrator shall not be entitled to payment or
reimbursement from the Unaffiliated Seller for any routine ongoing expenses
incurred by Xxxxx Fargo Bank, National Association, in its capacity as
Securities Administrator and/or Master Servicer in the ordinary course of its
duties as Securities Administrator, Master Servicer, Registrar, or paying agent
under this Agreement or for any other expenses, including indemnification
payments, except as set forth herein.
The Trustee executes the Certificates and the Securities
Administrator authenticates the Certificates not in its individual capacity but
solely as Trustee and Securities Administrator, respectively, of the Trust Fund
created by this Agreement, in the exercise of the powers and authority conferred
and vested in it by this Agreement.
Section 10.06 Eligibility Requirements for Securities Administrator.
The Securities Administrator hereunder shall at all times be a corporation or
association organized and doing business under the laws the United States of
America or any state thereof, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by federal or state authority and with a
credit rating of at least investment grade. If such corporation or association
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 or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Securities Administrator shall cease to be eligible in
accordance with the provisions of this Section 10.06, the Securities
Administrator shall resign immediately in the manner and with the effect
specified in Section 10.07 hereof. The entity serving as Securities
Administrator may have normal banking and trust relationships with the Depositor
and its affiliates or the Trustee and its affiliates.
Any successor Securities Administrator (i) may not be an originator,
the Master Servicer, the Servicer, the Depositor or an affiliate of the
Depositor unless the Securities Administrator functions are operated through an
institutional trust department of the Securities Administrator, (ii) must be
authorized to exercise corporate trust powers under the laws of its jurisdiction
of organization, and (iii) must be rated at least "A/F1" by Fitch, if Fitch is a
Rating Agency and rates such successor, or the equivalent rating by S&P or
Xxxxx'x. If no successor Securities Administrator shall have been appointed and
shall have accepted appointment within 60 days after the Securities
Administrator ceases to be the Securities Administrator pursuant to Section
10.07, then the Trustee may (but shall not be obligated to) become the successor
Securities Administrator. The Depositor shall appoint a successor to the
Securities Administrator in accordance with Section 10.07. The Trustee shall
notify the Rating Agencies of any change of Securities Administrator.
Section 10.07 Resignation and Removal of Securities Administrator.
The Securities Administrator may at any time resign by giving written notice of
resignation to the Depositor, the Swap Provider and the Trustee and each Rating
Agency not less than 60 days before the date specified in such notice when,
subject to Section 10.08, such resignation is to take effect, and acceptance by
a successor Securities Administrator in accordance with Section 10.08 meeting
the qualifications set forth in Section 10.06. If no successor Securities
Administrator meeting such qualifications shall have been so appointed by the
Depositor and have accepted appointment within 30 days after the giving of such
notice of resignation, the resigning Securities Administrator may petition any
court of competent jurisdiction for the appointment of a successor Securities
Administrator.
If at any time 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, or if at any time
the Securities Administrator shall become incapable of acting, or shall be
adjudged as bankrupt or insolvent, or a receiver of the Securities Administrator
or of its property shall be appointed, or any public officer shall take charge
or control of the Securities Administrator or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, or a tax is imposed with
respect to the Trust Fund by any state in which the Securities Administrator or
the Trust Fund is located and the imposition of such tax would be avoided by the
appointment of a different Securities Administrator, then the Depositor may
remove the Securities Administrator and appoint a successor Securities
Administrator by written instrument, in triplicate, one copy of which instrument
shall be delivered to the Securities Administrator so removed, one copy of which
shall be delivered to the Master Servicer and one copy to the successor
Securities Administrator.
The Holders of Certificates entitled to at least a majority of the
Voting Rights may at any time remove the Securities Administrator and appoint a
successor Securities Administrator by written instrument or instruments, in
triplicate, signed by such Holders or their attorneys in fact duly authorized,
one complete set of which instruments shall be delivered by the successor
Securities Administrator to the Trustee, one complete set to the Securities
Administrator so removed and one complete set to the successor so appointed.
Notice of any removal of the Securities Administrator shall be given to each
Rating Agency by the successor Securities Administrator.
Any resignation or removal of the Securities Administrator and
appointment of a successor Securities Administrator pursuant to any of the
provisions of this Section 10.07 shall become effective upon acceptance by the
successor Securities Administrator of appointment as provided in Section 10.08
hereof.
Section 10.08 Successor Securities Administrator. Any successor
Securities Administrator (which may be the Trustee) appointed as provided in
Section 10.07 hereof shall execute, acknowledge and deliver to the Swap Provider
and the Depositor and to its predecessor Securities Administrator and the
Trustee an instrument accepting such appointment hereunder and thereupon the
resignation or removal of the predecessor Securities Administrator shall become
effective and such successor 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 Securities Administrator herein. The Depositor, the Trustee,
the Master Servicer and the predecessor Securities Administrator shall execute
and deliver such instruments and do such other things as may reasonably be
required for more fully and certainly vesting and confirming in the successor
Securities Administrator all such rights, powers, duties, and obligations.
No successor Securities Administrator shall accept appointment as
provided in this Section 10.08 unless at the time of such acceptance such
successor Securities Administrator shall be eligible under the provisions of
Section 10.06 hereof and its appointment shall not adversely affect the then
current rating of the Certificates, as confirmed in writing by each Rating
Agency.
Upon acceptance by a successor Securities Administrator of
appointment as provided in this Section 10.08, the Depositor shall mail notice
of the succession of such Securities Administrator hereunder to all Holders of
Certificates. If the Depositor fails to mail such notice within 10 days after
acceptance by the successor Securities Administrator of appointment, the
successor Securities Administrator shall cause such notice to be mailed at the
expense of the Depositor.
Section 10.09 Merger or Consolidation of Securities Administrator.
Any corporation or other entity into which the Securities Administrator may be
merged or converted or with which it may be consolidated or any corporation or
other entity resulting from any merger, conversion or consolidation to which the
Securities Administrator shall be a party, or any corporation or other entity
succeeding to the business of the Securities Administrator, shall be the
successor of the Securities Administrator hereunder, provided that such
corporation or other entity 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. In connection with the succession to the Securities
Administrator under this Agreement by any Person (i) into which the Securities
Administrator may be merged or consolidated, or (ii) which may be appointed as a
successor to the Securities Administrator, the Securities Administrator shall
notify the Depositor of such succession or appointment and shall furnish to the
Depositor all information reasonably necessary for the Securities Administrator
to accurately and timely report, pursuant to Section 8.12(g), the event under
Item 6.02 of Form 8-K pursuant to the Exchange Act (if such reports under the
Exchange Act are required to be filed under the Exchange Act).
Section 10.10 Assignment or Delegation of Duties by the Securities
Administrator. Except as expressly provided herein, the Securities Administrator
shall not assign or transfer any of its rights, benefits or privileges hereunder
to any other Person, or delegate to or subcontract with, or authorize or appoint
any other Person to perform any of the duties, covenants or obligations to be
performed by the Securities Administrator; provided, however, that the
Securities Administrator shall have the right with the prior written consent of
the Depositor (which shall not be unreasonably withheld or delayed) and upon
delivery to the Trustee and the Depositor of a letter from each Rating Agency to
the effect that such action shall not result in a downgrade of the ratings
assigned to any of the Certificates, to delegate or assign to or subcontract
with or authorize or appoint any qualified Person to perform and carry out any
duties, covenants or obligations to be performed and carried out by the
Securities Administrator hereunder, provided, further, that the Securities
Administrator complies with Section 3.02(e) as if the Securities Administrator
were a "Servicer" pursuant to that Section. Notice of such permitted assignment
shall be given promptly by the Securities Administrator to the Depositor, the
Swap Provider and the Trustee. If, pursuant to any provision hereof, the duties
of the Securities Administrator are transferred to a successor securities
administrator, the entire compensation payable to the Securities Administrator
pursuant hereto shall thereafter be payable to such successor securities
administrator but in no event shall the fee payable to the successor Securities
Administrator exceed that payable to the predecessor Securities Administrator.
ARTICLE XI
TERMINATION
Section 11.01 Termination upon Liquidation or Purchase of the
Mortgage Loans. Subject to Section 11.03, the obligations and responsibilities
of the Depositor, the Servicer, the Securities Administrator and the Trustee
created hereby with respect to the Trust Fund shall terminate upon the earlier
of (a) the purchase, on or after the applicable Optional Termination Date, by
the Servicer, the Master Servicer or the Class X Certificateholders (subject to
the restrictions set forth in the definition of "Optional Termination Date") of
all Mortgage Loans (and REO Properties) at the price equal to the sum of (i)
100% of the unpaid principal balance of each Mortgage Loan (other than in
respect of REO Property) plus accrued and unpaid interest thereon at the
applicable Mortgage Rate, (ii) the lesser of (x) the appraised value of any REO
Property as determined by the higher of two appraisals completed by two
independent appraisers selected by the party exercising the optimal termination
at the expense of the party exercising the optimal termination plus, accrued and
unpaid interest on each Mortgage Loan at the applicable Mortgage Rate and (y)
the unpaid principal balance of each Mortgage Loan related to any REO Property,
in each case plus accrued and unpaid interest thereon at the applicable Mortgage
Rate, (iii) all costs and expenses incurred by, or on behalf of, the Trust Fund,
of which the Securities Administrator has actual knowledge, in connection with
any violation by such Mortgage Loan of any predatory or abusive-lending law and
(iv) any Swap Termination Payment, other than a Defaulted Swap Termination
Payment, owed to the Swap Provider (the "Termination Price") and (b) the later
of (i) the maturity or other liquidation 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 trusts created hereby continue beyond
the expiration of 21 years from the death of the survivor of the descendants of
Xxxxxx X. Xxxxxxx, the late Ambassador of the United States to the Court of St.
James's, living on the date hereof.
Notwithstanding the foregoing, if Standard & Poor's has rated a
class of debt securities ("NIM Securities") that are backed by the Class X
Certificates and Class P Certificates and that are outstanding on any date on
which the Servicer intends to exercise its option to purchase the Mortgage
Loans, the Servicer will be permitted to exercise such option only if one of the
following additional conditions is met: (i) after distribution of the
Termination Price to the Certificateholders (other than the Holders of the Class
X Certificates, Class P Certificates and Class R Certificates) to redeem the
related Certificates, the remainder of the Termination Price (the "Remainder
Amount") is distributed to the Holders of the Class X Certificates and Class P
Certificates and is sufficient to pay the outstanding principal amount of and
accrued and unpaid interest on the NIM Securities to the extent the NIM
Securities are then outstanding; or (ii) (A) at the same time that the Servicer
remits the Termination Price to the Master Servicer, it also remits to the
Securities Administrator an additional amount which, in combination with the
Remainder Amount, is sufficient to pay the outstanding principal amount of and
accrued and unpaid interest on the NIM Securities, to the extent the NIM
Securities are then outstanding, and (B) the Securities Administrator remits the
Remainder Amount to the Holders of the Class X Certificates and Class P
Certificates and remits that additional amount directly to the NIM Trustee (plus
any outstanding fees and expenses due and owing to the NIM Trustee) under the
indenture creating the NIM Securities.
Section 11.02 Final Distribution on the Certificates. If on any
Remittance Date, the Servicer determines that there are no Outstanding Mortgage
Loans and no other funds or assets in the Trust Fund other than the funds in the
Collection Accounts, the Servicer shall direct the Securities Administrator
promptly to send a Notice of Final Distribution to each Certificateholder and
the Swap Provider. If the Servicer so elects to terminate, by the 25th day of
the month preceding the month of the final distribution, the Servicer shall
notify the Depositor, the Securities Administrator and the Trustee of the final
Distribution Date the Servicer or the Class X Certificateholder of the date the
Servicer intends to terminate the Trust Fund and of the applicable repurchase
price of the Mortgage Loans and REO Properties.
A Notice of Final Distribution, specifying the Distribution Date on
which 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 earlier than the 10th
day and not later than the 15th day of the month of such final distribution. Any
such Notice of Final Distribution shall specify (a) the Distribution Date upon
which final distribution on the Certificates will 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 Servicer will give such Notice of Final Distribution to each
Rating Agency and the Swap Provider at the time such Notice of Final
Distribution is given to Certificateholders.
In the event such Notice of Final Distribution is given, the
Servicer shall cause all funds in its Collection Account to be remitted to the
Master Servicer for deposit in the Distribution Account on the 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 Securities Administrator of a
Request for Release therefor, the Securities Administrator shall forward the
Request for Release to the Custodian and the Custodian shall promptly release to
the Servicer the Custodial Files for the Mortgage Loans.
Upon presentation and surrender of the Certificates, the Securities
Administrator shall cause to be distributed to the Certificateholders of each
Class (after reimbursement of all amounts due to the Servicer, the Depositor,
the Swap Provider and the Trustee hereunder), in each case on the final
Distribution Date and in the order set forth in Section 4.02, in proportion to
their respective Percentage Interests, with respect to Certificateholders of the
same Class, up to an amount equal to (i) as to each Class of Regular
Certificates (except the Class X Certificates), the Certificate Balance thereof
plus for each such Class and the Class X Certificates accrued interest thereon
in the case of an interest bearing Certificate and all other amounts to which
such Classes are entitled pursuant to Section 4.02 and (ii) as to the Residual
Certificates, the amount, if any, which remains on deposit in the Distribution
Account (other than the amounts retained to meet claims) after application
pursuant to clause (i) above.
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 which remain a part of the Trust Fund. If within one year
after the second notice all Certificates shall not have been surrendered for
cancellation, the Class R Certificateholders shall be entitled to all unclaimed
funds and other assets of the Trust Fund which remain subject hereto.
Section 11.03 Additional Termination Requirements. In the event the
Servicer exercises its purchase option with respect to the Mortgage Loans as
provided in Section 11.01, the Trust Fund shall be terminated in accordance with
the following additional requirements, unless the Securities Administrator has
been supplied with an Opinion of Counsel, at the expense of the Servicer or the
Class X Certificateholder, as applicable, to the effect that the failure to
comply with the requirements of this Section 11.03 will not (i) result in the
imposition of taxes on "prohibited transactions" on any Trust REMIC as defined
in Section 860F of the Code, or (ii) cause any Trust REMIC to fail to qualify as
a REMIC at any time that any Certificates are outstanding:
(a) The Securities Administrator on behalf of the Trustee shall sell
all of the assets of the Trust Fund to the Servicer and, no later than the next
Distribution Date after such sale (and in no event more than 90 days after such
sale), shall, in the order set forth in Section 4.02 and subject to the payment
of all amounts payable under Section 4.02, distribute to the Certificateholders
the proceeds of such sale in complete liquidation of each Trust REMIC; and
(b) The Securities Administrator shall attach a statement to the
final federal income tax return for each Trust REMIC stating that pursuant to
Treasury Regulations Section 1.860F-1, the first day of the 90 day liquidation
period for each Trust REMIC was the date on which the Securities Administrator
on behalf of the Trustee sold the assets of the Trust Fund to the Servicer.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01 Amendment. This Agreement may be amended from time to
time (x) by the Depositor, the Servicer, the Custodian, the Securities
Administrator, the Master Servicer and the Trustee (y) with the consent of the
Unaffiliated Seller unless the Securities Administrator and the Trustee receive
an Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Securities Administrator, the Master Servicer, the Trustee or the Trust) stating
that the amendment will not adversely affect the Unaffiliated Seller, but (z)
without the consent of any of the Certificateholders (i) to cure any ambiguity
or mistake, (ii) to correct any defective provision herein or to supplement any
provision herein which may be inconsistent with any other provision herein,
(iii) to add to the duties of the Depositor, the Master Servicer, the Securities
Administrator or the Servicer, (iv) to add any other provisions with respect to
matters or questions arising hereunder or (v) to modify, alter, amend, add to or
rescind any of the terms or provisions contained in this Agreement; provided,
that any action pursuant to clauses (iv) or (v) above shall not, as evidenced by
an Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Securities Administrator, the Trustee, the Master Servicer or the Trust),
adversely affect in any material respect the interests of any Certificateholder
(it being understood that any Opinion of Counsel with respect to income tax
matters will be limited to an opinion that such amendment will not cause the
imposition of any federal income tax on any Trust REMIC created hereunder or the
Certificateholders or cause any Trust REMIC created hereunder to fail to qualify
as a REMIC at any time that any Certificates are outstanding); and provided,
further, that any such action pursuant to clause (iv) or (v) above shall not be
deemed to adversely affect in any material respect the interests of the Swap
Provider, the Cap Provider or the Certificateholders if the Person requesting
the amendment obtains a letter from each Rating Agency stating that the
amendment would not result in the downgrading or withdrawal of the respective
ratings then assigned to the Certificates; it being understood and agreed that
any such letter in and of itself will not represent a determination as to the
materiality of any such amendment and will represent a determination only as to
the credit issues affecting any such rating.
In addition, this Agreement may also be amended from time to time
(x) by the Trustee, the Depositor, the Custodian, the Securities Administrator,
the Master Servicer and the Servicer and (y) with the consent of the
Unaffiliated Seller unless the Trustee and the Securities Administrator receive
an Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Securities Administrator, the Master Servicer, the Trustee or the Trust) stating
that the amendment will not adversely affect the Unaffiliated Seller, but (z)
without the consent of the Certificateholders, to modify, eliminate or add to
any of its provisions to such extent as shall be necessary or helpful to (i)
maintain the qualification of each Trust REMIC and Grantor Trust under the Code,
(ii) avoid or minimize the risk of the imposition of any tax on any Trust REMIC
and Grantor Trust pursuant to the Code that would be a claim at any time prior
to the final redemption of the Certificates or (iii) comply with any other
requirements of the Code; provided, that the Trustee and the Securities
Administrator has been provided an Opinion of Counsel, which opinion shall be an
expense of the party requesting such opinion but in any case shall not be an
expense of the Securities Administrator, the Master Servicer, the Trustee or the
Trust, to the effect that such action is necessary or helpful to, as applicable,
(i) maintain such qualification, (ii) avoid or minimize the risk of the
imposition of such a tax or (iii) comply with any such requirements of the Code
or facilitate the administration and reporting of each Trust REMIC or Grantor
Trust; provided, however, that any amendment that would otherwise require the
consent of Holders pursuant to the next paragraph shall be made only pursuant to
the terms of the next paragraph.
This Agreement may also be amended from time to time (x) by the
Depositor, the Servicer, the Master Servicer, the Custodian, the Securities
Administrator and the Trustee (y) with the consent of the Unaffiliated Seller
unless the Securities Administrator receives an Opinion of Counsel (which
Opinion of Counsel shall not be an expense of the Securities Administrator, the
Master Servicer, the Trustee or the Trust) stating that the amendment will not
adversely affect the Unaffiliated Seller, and (z), except as set forth in
Section 12.07, with the consent of the Holders of Certificates evidencing
Percentage Interests aggregating not less than 66-2/3% of each Class of
Certificates (based on the aggregate outstanding principal balance of such class
at such time) affected thereby, 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,
however, 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) adversely affect in
any material respect the interests of the Holders of any Class of Certificates
in a manner other than as described in (i), without the consent of the Holders
of Certificates of such Class evidencing, as to such Class, Percentage Interests
aggregating not less than 66-2/3%, or (iii) reduce the aforesaid percentages of
Certificates the Holders of which are required to consent to any such amendment,
without the consent of the Holders of all such Certificates then outstanding;
provided, further, that, without the consent of the Holders of a majority of the
Certificates then Outstanding, no such amendment shall result in a Significant
Change to a Permitted Activity.
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, which opinion shall not be an expense
of the Securities Administrator, the Master Servicer, the Trustee or the Trust,
to the effect that such amendment will not cause the imposition of any federal
income tax on any Trust REMIC or the Certificateholders or cause any Trust REMIC
to fail to qualify as a REMIC or the Grantor Trust to fail to qualify as a
grantor trust at any time that any Certificates are outstanding.
Notwithstanding any contrary provision of this Agreement, the
Securities Administrator shall not consent to any amendment, modification or
change to this Agreement without the prior written consent of the Swap Provider
or the Cap Provider, as applicable, if such amendment, modification or change
could reasonably be expected to have a material adverse effect on the rights or
obligations of the Swap Provider or the Cap Provider, as applicable, under this
Agreement or under the Interest Rate Swap Agreement or the Interest Rate Cap
Agreement, as applicable. Unless notified by the Swap Provider or the Cap
Provider, as applicable, that the Swap Provider or the Cap Provider, as
applicable, could reasonably be materially and adversely affected by such
amendment, modification or change, for purposes of determining whether an
amendment, modification or change could reasonably be expected to have a
material adverse effect on the Swap Provider or the Cap Provider, as applicable,
the Trustee and the Securities Administrator shall be entitled to rely on an
Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Securities Administrator or the Trustee) after giving notice of such amendment,
modification or change to the Swap Provider. The Securities Administrator shall
furnish to the Swap Provider and the Cap Provider a copy of each proposed
amendment, modification or change to this Agreement at least ten Business Days
prior to the execution thereof and a copy of each executed amendment,
modification or change to this Agreement promptly upon execution thereof, along
with copies of the letter from each Rating Agency stating that the amendment,
modification or change would not result in the downgrading or withdrawal of the
respective ratings then assigned to the Certificates.
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 or a copy of such amendment to the
Swap Provider, the Cap Provider, each Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders
under this Section 12.01 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.
Nothing in this Agreement shall require the Securities
Administrator, the Trustee or the Custodian to enter into an amendment without
receiving an Opinion of Counsel (which Opinion shall not be an expense of the
Trustee, the Custodian, the Securities Administrator, the Master Servicer or the
Trust), satisfactory to the Trustee, the Securities Administrator, the Master
Servicer and the Custodian that (i) such amendment is permitted and is not
prohibited by this Agreement and that all requirements for amending this
Agreement have been complied with; and (ii) either (A) the amendment does not
adversely affect in any material respect the interests of any Certificateholder
or (B) the conclusion set forth in the immediately preceding clause (A) is not
required to be reached pursuant to this Section 12.01.
Section 12.02 Recordation of Agreement; Counterparts. 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 Mortgaged Properties are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Servicer at its expense, but only upon receipt of an Opinion of Counsel to the
effect that such recordation materially and beneficially affects 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 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.
Section 12.04 Intention of Parties. It is the express intent of the
parties hereto that the conveyance (i) of the Mortgage Loans by the Depositor
and (ii) of the Trust Fund by the Depositor to the Trustee each be, and be
construed as, an absolute sale thereof. It is, further, not the intention of the
parties that such conveyances be deemed a pledge thereof. However, in the event
that, notwithstanding the intent of the parties, such assets are held to be the
property of the Depositor, as the case may be, or if for any other reason this
Agreement is held or deemed to create a security interest in either such assets,
then (i) this Agreement shall be deemed to be a security agreement within the
meaning of the Uniform Commercial Code of the State of New York and (ii) the
conveyances provided for in this Agreement shall be deemed to be an assignment
and a grant by the Depositor to the Trustee, for the benefit of the
Certificateholders, of a security interest in all of the assets transferred,
whether now owned or hereafter acquired.
The Depositor, for the benefit of the Certificateholders and the
Swap Provider, 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 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. The
Depositor shall arrange for filing any Uniform Commercial Code continuation
statements in connection with any security interest granted or assigned to the
Trustee for the benefit of the Certificateholders.
Section 12.05 Notices. (a) The Securities Administrator shall use
its best efforts to promptly provide notice to each Rating Agency with respect
to each of the following of which it has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Event of Default that has not been
cured;
3. The resignation or termination of the Servicer, the Securities
Administrator, the Master Servicer or the Trustee and the
appointment of any successor;
4. The repurchase or substitution of Mortgage Loans pursuant to
Section 2.03; and
5. The final payment to Certificateholders.
(b) In addition, the Securities Administrator shall promptly furnish
to each Rating Agency copies of the following:
1. Each report to Certificateholders described in Section 4.03;
and
2. Any notice of a purchase of a Mortgage Loan pursuant to
Section 2.02, 2.03 or 3.11.
All directions, demands, consents, notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given when delivered
to (a) in the case of the Depositor or the Representative, Xxxxxx Xxxxxxx ABS
Capital I Inc. or Xxxxxx Xxxxxxx & Co. Incorporated, 0000 Xxxxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx, 00000, Attention: Xxxxxxx Xxx, with a copy to Xxxxx Xxx,
Esq., 0000 Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, (b) in the case of
the Servicer, Saxon Mortgage Services, Inc. 0000 Xxxxxxxxxx Xxxxx, Xxxx Xxxxx,
Xxxxx, 00000, Attention: Xxxxx Xxxx, President, with a copy to Saxon Capital,
Inc., 0000 Xxx Xxxx, Xxxxx 000, Xxxx Xxxxx, Xxxxxxxx 00000, Attention: General
Counsel, or such other address as may be hereafter furnished to the parties
hereto in writing, (c) in the case of the Securities Administrator or Master
Servicer to the Corporate Trust Office or such other address as the Securities
Administrator or Master Servicer may hereafter furnish to the parties hereto,
(d) in the case of the Trustee and the Custodian to Deutsche Bank National Trust
Company, 0000 Xxxx Xx. Xxxxxx Xxxxx, Xxxxx Xxx, Xxxxxxxxxx 00000-0000,
Attention: Trust Administration - IX0702, (e) in the case of the Unaffiliated
Seller, Natixis Real Estate Capital, Inc., 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: General Counsel, or such other address as the
Unaffiliated Seller may hereafter furnish to the parties hereto, (f) in the case
of each of the Rating Agencies, the address specified therefor in the definition
corresponding to the name of such Rating Agency, (g) in the case of any
Originator, the address specified therefor in the applicable Mortgage Loan
Purchase Agreement and (h) in the case of the Swap Provider, the address
specified therefor in the Interest Rate Swap Agreement. Notices to
Certificateholders shall be deemed given when mailed, first class postage
prepaid, to their respective addresses appearing in the Certificate Register.
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; Sales; Advance Facilities. Notwithstanding
anything to the contrary contained herein, except as provided in Section 6.04,
this Agreement may not be assigned by the Servicer without the prior written
consent of the Trustee and the Depositor; provided, however, the Servicer is
hereby authorized to enter into an Advance Facility under which (l) the Servicer
sells, assigns or pledges to an Advancing Person the Servicer's rights under
this Agreement to be reimbursed for any P&I Advances or Servicing Advances
and/or (2) an Advancing Person agrees to fund some or all P&I Advances or
Servicing Advances required to be made by the Servicer pursuant to this
Agreement. No consent of the Trustee, Certificateholders or any other party is
required before the Servicer may enter into an Advance Facility. Notwithstanding
the existence of any Advance Facility under which an Advancing Person agrees to
fund P&I Advances and/or Servicing Advances on the Servicer's behalf, the
Servicer shall remain obligated pursuant to this Agreement to make P&I Advances
and Servicing Advances pursuant to and as required by this Agreement, and shall
not be relieved of such obligations by virtue of such Advance Facility.
Reimbursement amounts shall consist solely of amounts in respect of
P&I Advances and/or Servicing Advances made with respect to the Mortgage Loans
for which the Servicer would be permitted to reimburse itself in accordance with
this Agreement.
The Servicer shall maintain and provide to any successor Servicer a
detailed accounting on a loan-by-loan basis as to amounts advanced by, pledged
or assigned to, and reimbursed to any Advancing Person. The successor Servicer
shall be entitled to rely on any such information provided by the predecessor
Servicer, and the successor Servicer shall not be liable for any errors in such
information.
An Advancing Person who purchases or receives an assignment or
pledge of the rights to be reimbursed for P&I Advances and/or Servicing
Advances, and/or whose obligations hereunder are limited to the funding of P&I
Advances and/or Servicing Advances shall not be required to meet the criteria
for qualification of a Subservicer set forth in this Agreement.
The documentation establishing any Advance Facility shall require
that reimbursement amounts distributed with respect to each Mortgage Loan be
allocated to outstanding xxxxxxxxxxxx X&X Advances or Servicing Advances (as the
case may be) made with respect to that Mortgage Loan on a "first-in, first-out"
(FIFO) basis. Such documentation shall also require the Servicer to provide to
the related Advancing Person or its designee loan-by-loan information with
respect to each such reimbursement amount distributed to such Advancing Person
or Advance Facility trustee on each Distribution Date, to enable the Advancing
Person or Advance Facility trustee to make the FIFO allocation of each such
reimbursement amount with respect to each applicable Mortgage Loan. The Servicer
shall remain entitled to be reimbursed by the Advancing Person or Advance
Facility trustee for all P&I Advances and Servicing Advances funded by the
Servicer to the extent the related rights to be reimbursed therefor have not
been sold, assigned or pledged to an Advancing Person.
Any amendment to this Section 12.07 or to any other provision of
this Agreement that may be necessary or appropriate to effect the terms of an
Advance Facility as described generally in this Section 12.07, including
amendments to add provisions relating to a successor Servicer, may be entered
into by the Trustee, the Depositor, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and the Servicer without the consent of any
Certificateholder, notwithstanding anything to the contrary in this Agreement,
upon receipt by the Trustee of an Opinion of Counsel that such amendment has no
material adverse effect on the Certificateholders or written confirmation from
the Rating Agencies that such amendment will not adversely affect the ratings on
the Certificates. Prior to entering into an Advance Facility, the Servicer shall
notify the lender under such facility in writing that: (a) the Advances financed
by and/or pledged to the lender are obligations owed to the Servicer on a
non-recourse basis payable only from the cash flows and proceeds received under
this Agreement for reimbursement of Advances only to the extent provided herein,
and none of the Trustee, the Securities Administrator, and the Trust are
otherwise obligated or liable to repay any Advances financed by the lender; (b)
the Servicer will be responsible for remitting to the lender the applicable
amounts collected by it as reimbursement for Advances funded by the lender,
subject to the restrictions and priorities created in this Agreement; and (c)
none of the Securities Administrator, the Master Servicer or the Trustee shall
have any responsibility to track or monitor the administration of the financing
arrangement between the Servicer and the lender.
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 created hereby, 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
created hereby, 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 herein provided, and
unless 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 Servicer agrees that,
on reasonable prior notice, it will permit any representative of the Depositor,
the Unaffiliated Seller, the Securities Administrator, the Master Servicer or
the Trustee during the Servicer's normal business hours, to examine all the
books of account, records, reports and other papers of the 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 party
conducting the inspection and to discuss its affairs, finances and accounts
relating to the Mortgage Loans with its officers, employees and independent
public accountants (and by this provision the Servicer hereby authorizes said
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 customary out-of-pocket expense of the Servicer incident to the
exercise by the Depositor, the Unaffiliated Seller, the Securities Administrator
or the Trustee of any right under this Section 12.09 shall be borne by the
Servicer.
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 [Reserved].
Section 12.12 Third Party Beneficiary. The parties agree that each
of the Swap Provider and the Cap Provider is intended and shall have all rights
of a third-party beneficiary of this Agreement. Notwithstanding anything to the
contrary herein, any notices required to be provided to the Swap Provider or the
Cap Provider under this Agreement shall no longer be required following the
termination of the Swap Agreement or the Cap Agreement, as applicable.
Section 12.13 Waiver of Jury Trial. EACH PARTY HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY, WAIVES (TO THE EXTENT PERMITTED BY APPLICABLE
LAW) ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR
RELATING TO THIS AGREEMENT AND AGREES THAT ANY SUCH DISPUTE SHALL BE TRIED
BEFORE A JUDGE SITTING WITHOUT A JURY.
Section 12.14 Regulation AB Compliance; Intent of the Parties;
Reasonableness. The parties hereto acknowledge 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
agree to comply with reasonable requests made by the Depositor in good faith for
delivery of information under these provisions on the basis of evolving
interpretations of Regulation AB. In connection with the Trust, the Master
Servicer, the Servicer, the Securities Administrator, the Trustee and the
Custodian shall cooperate fully with the Depositor to deliver to the Depositor
(including its assignees or designees), any and all statements, reports,
certifications, records and any other information available to such party and
reasonably necessary in the good faith determination of the parties hereto to
permit the Depositor to comply with the provisions of Regulation AB, together
with such disclosures relating to the Master Servicer, the Servicer, the
Securities Administrator, the Trustee and the Custodian, as applicable,
reasonably believed by the Depositor to be necessary in order to effect such
compliance.
IN WITNESS WHEREOF, the Depositor, the Trustee, the Unaffiliated
Seller, the Servicer, the Securities Administrator, the Master Servicer and the
Custodian have caused their names to be signed hereto by their respective
officers thereunto duly authorized as of the day and year first above written.
XXXXXX XXXXXXX ABS CAPITAL I INC.,
as Depositor
By: /s/ Xxxxxxx Xxx
--------------------------------------
Name: Xxxxxxx Xxx
Title: Vice President
XXXXX FARGO BANK, National
Association, as Master Servicer and
Securities Administrator
By: /s/ Xxxxxx Xxxx
--------------------------------------
Name: Xxxxxx Xxxx
Title: Vice President
DEUTSCHE BANK NATIONAL TRUST COMPANY,
solely as Trustee and not in its
individual capacity, and as
Custodian
By: /s/ Xxxxxxx Xxxxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Authorized Signer
By: /s/ Xxxxxxx Xxxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
SAXON MORTGAGE SERVICES, INC., as
Servicer
By: /s/ Xxxxx X. Xxxx
--------------------------------------
Name: Xxxxx X. Xxxx
Title: Chief Exeutive Officer and
President
NATIXIS REAL ESTATE CAPITAL INC., as
Unaffiliated Seller
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
--------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Title: Managing Director
SCHEDULE I
(Delivered to the Securities Administrator and the Trustee and not attached to
the Pooling and Servicing Agreement)
SCHEDULE II
[Reserved]
SCHEDULE III
IXIS REAL ESTATE CAPITAL TRUST 2007-HE2
Mortgage Pass-Through Certificates,
Series 2007-HE2
Representations and Warranties of Saxon
(1) The Servicer is duly organized as a corporation and is validly
existing and in good standing under the laws of the state of Texas and is
licensed and qualified to transact any and all business contemplated by this
Pooling and Servicing Agreement to be conducted by the Servicer in any state in
which a Mortgaged Property securing a 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 Mortgage Loan and to
service the Mortgage Loans in accordance with the terms of this Pooling and
Servicing Agreement;
(2) The Servicer has the full 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 Pooling and Servicing Agreement and has duly
authorized by all necessary action on the part of the Servicer the execution,
delivery and performance of this Pooling and Servicing Agreement; and this
Pooling and Servicing Agreement, assuming the due authorization, execution and
delivery thereof by the other parties thereto, constitutes a legal, valid and
binding obligation of the Servicer, enforceable against the Servicer in
accordance with its terms, except to the extent that (a) the enforceability
thereof 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 the equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought;
(3) The execution and delivery of this Pooling and Servicing Agreement by
the Servicer, the servicing of the Mortgage Loans by the Servicer hereunder, the
consummation by the Servicer of any other of the transactions herein
contemplated, and the fulfillment of or compliance with the terms hereof are in
the ordinary course of business of the Servicer and will not (A) result in a
breach of any term or provision of the organizational documents of the Servicer
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 the Servicer is a party or by which it may be bound, or any
statute, order or regulation applicable to the Servicer of any court, regulatory
body, administrative agency or governmental body having jurisdiction over the
Servicer; and the Servicer is not a party to, bound by, or in breach or
violation of any indenture or other agreement or instrument, or subject to or in
violation of any statute, order or regulation of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it, which
materially and adversely affects or, to the Servicer's knowledge, would in the
future materially and adversely affect, (x) the ability of the Servicer to
perform its obligations under this Pooling and Servicing Agreement or (y) the
business, operations, financial condition, properties or assets of the Servicer
taken as a whole;
(4) The Servicer is an approved seller/servicer for Xxxxxx Xxx or Xxxxxxx
Mac;
(5) No action, suit, proceeding or investigation is pending or, to the
best of the Servicer's knowledge, threatened against the Servicer, before any
court, administrative agency or other tribunal asserting the invalidity of this
Pooling and Servicing Agreement, seeking to prevent the consummation of any of
the transactions contemplated by this Pooling and Servicing Agreement or which,
either in any one instance or in the aggregate, may result in any material
adverse change in business, operations, financial conditions, properties or
assets of the Servicer, or in any material impairment of the right or ability of
the Servicer to carry on its business substantially as now conducted, or in any
material liability on the part of the Servicer, or which would draw into
question the validity of this Pooling and Servicing Agreement or the Mortgage
Loans or of any action taken or to be taken in connection with the obligations
of the Servicer contemplated herein, or which would be likely to impair
materially the ability of the Servicer to perform under the terms of this
Pooling and Servicing Agreement;
(6) 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 Pooling
and Servicing Agreement or the consummation by the Servicer of the transactions
contemplated by this Pooling and Servicing Agreement, except for such consents,
approvals, authorizations or orders, if any, that have been obtained prior to
the Closing Date;
(7) The Servicer represents that its computer and other systems used in
servicing the Mortgage Loans operate in a manner such that the Servicer can
service the Mortgage Loans in accordance with the terms of this Pooling and
Servicing Agreement; and
(8) With respect to each Mortgage Loan, to the extent the Servicer
serviced such Mortgage Loan and to the extent the Servicer provided monthly
reports to the three credit repositories, the Servicer has fully furnished, in
accordance with the Fair Credit Reporting Act and its implementing regulation,
accurate and compete information (i.e., favorable and unfavorable) on its
borrower credit files to Equifax, Experian, and Trans Union Credit Information
Company (three of the national credit repositories), on a monthly basis.
SCHEDULE IIIA
Further Representations and Warranties of Saxon
(1) Mortgage Loan Schedule. With respect to each Mortgage Loan, as of the
applicable Cut-off Date, each of (1) the last Due Date on which a payment was
actually applied to the outstanding principal balance of each Mortgage Loan; (2)
the Stated Principal Balance of each Mortgage Loan, after deduction of payments
of principal due and collected on or before the applicable Cut-off Date; and (3)
the Servicing Transfer Date for each Mortgage Loan, in each case, as listed on
the Mortgage Loan Schedule, is true and correct;
(2) Payments Current. Unless otherwise indicated on the related Mortgage
Loan Schedule, with respect to each Mortgage Loan, no Scheduled Payment is 30
days or more Delinquent as of the Cut-off Date nor has any Payment been 30 days
or more Delinquent at any time from and after the Servicing Transfer Date
through the Cut-off Date;
(3) Original Terms Unmodified. With respect to each Mortgage Loan, the
terms of the Mortgage Note and Mortgage have not been impaired, waived, altered
or modified by or on behalf of the Servicer from and after the Servicing
Transfer Date;
(4) No Satisfaction of Mortgage. With respect to each Mortgage Loan, since
the related Servicing Transfer Date and except for prepayments in full, the
Mortgage has not been satisfied, cancelled, subordinated or rescinded, in whole
or in part, and the Mortgaged Property has not been released from the lien of
the Mortgage, in whole or in part, nor has any instrument been executed that
would effect any such release, cancellation, subordination or rescission. From
and after the Servicing Transfer Date, the Servicer 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
Servicer waived any default resulting from any action or inaction by the
Mortgagor;
(5) No Defaults. With respect to each Mortgage Loan, to the best knowledge
of the Servicer, other than payments due but not yet 30 days Delinquent, there
is no material default, breach, violation or event which would permit
acceleration existing under the Mortgage or the Mortgage Note;
(6) Escrow Payments/Interest Rate Adjustments. With respect to each
Mortgage Loan, since the Servicing Transfer Date, the servicing and collection
practices used by the Servicer with respect to such Mortgage Loan have been in
all material respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all material respects legal
and proper. With respect to escrow deposits and Escrow Payments, if any, all
such deposits and payments received by the Servicer 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. All Escrow Payments have been collected in full compliance with state and
federal law and the provisions of the related Mortgage Note and Mortgage (to the
extent not otherwise prohibited by law). From and after the Servicing Transfer
Date, all Mortgage Rate adjustments (if any) have been made in strict compliance
with state and federal law and the terms of the related Mortgage Note;
(7) Other Insurance Policies. The improvements upon each Mortgaged
Property are covered by a valid and existing hazard insurance policy with a
generally acceptable carrier that provides for fire and extended coverage and
coverage for such other hazards as are customary in the area where the Mortgaged
Property is located; and
(8) Servicemembers Civil Relief Act. With respect to each Mortgage Loan,
from and after the Servicing Transfer Date, no Mortgagor has notified the
Servicer, and the Servicer has no knowledge, of any relief requested and allowed
to the Mortgagor under the Servicemembers Civil Relief Act or any similar state
or local law.
SCHEDULE IV
(a) Due Organization and Authority. The Unaffiliated Seller is a corporation
duly organized, validly existing and in good standing under the laws of
the state of New York and has all licenses necessary to carry on its
business as now being conducted and is licensed, qualified and in good
standing in each state wherein it owns or leases any material properties
or where a Mortgaged Property is located, if the laws of such state
require licensing or qualification in order to conduct business of the
type conducted by the Unaffiliated Seller, and in any event the
Unaffiliated Seller is in compliance with the laws of any such state to
the extent necessary; the Unaffiliated Seller has the full corporate
power, authority and legal right to execute and deliver this Agreement and
to perform its obligations hereunder; the execution, delivery and
performance of this Agreement by the Unaffiliated Seller and the
consummation of the transactions contemplated hereby have been duly and
validly authorized; this Agreement and all agreements contemplated hereby
have been duly executed and delivered and constitute the valid, legal,
binding and enforceable obligations of the Unaffiliated Seller, regardless
of whether such enforcement is sought in a proceeding in equity or at law;
and all requisite corporate action has been taken by the Unaffiliated
Seller to make this Agreement and all agreements contemplated hereby valid
and binding upon the Unaffiliated Seller in accordance with their terms;
(b) No Conflicts. Neither the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby, nor the fulfillment
of or compliance with the terms and conditions of this Agreement, will
conflict with or result in a breach of any of the terms, conditions or
provisions of the Unaffiliated Seller's charter or by-laws or any legal
restriction or any agreement or instrument to which the Unaffiliated
Seller is now a party or by which it is bound, or constitute a default or
result in an acceleration under any of the foregoing, except such
unfulfillment, non-compliance or default or acceleration does not in the
aggregate have a material adverse effect on the operation, business,
condition (business or otherwise) of the Unaffiliated Seller or result in
the violation of any law, rule, regulation, order, judgment or decree to
which the Unaffiliated Seller or its property is subject, except such
violation does not in the aggregate have a material adverse effect on the
operation, business, condition (business or otherwise) of the Unaffiliated
Seller or result in the creation or imposition of any lien, charge or
encumbrance that would have an adverse effect upon any of its properties
pursuant to the terms of any mortgage, contract, deed of trust or other
instrument;
(c) No Litigation Pending. There is no action, suit, proceeding or
investigation pending nor, to the Unaffiliated Seller's knowledge,
threatened against the Unaffiliated Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or which, either in any one instance or in
the aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Unaffiliated
Seller, or in any material impairment of the right or ability of the
Unaffiliated Seller to carry on its business substantially as now
conducted, or which would draw into question the validity of this
Agreement or of any action taken or to be taken in connection with the
obligations of the Unaffiliated Seller contemplated herein, or which would
be likely to impair materially the ability of the Unaffiliated Seller to
perform under the terms of this Agreement; and
(d) No Consent Required. No consent, approval, authorization or order of, or
registration or filing with, or notice to any court or governmental agency
or body including HUD, the FHA or the VA is required for the execution,
delivery and performance by the Unaffiliated Seller of or compliance by
the Unaffiliated Seller with this Agreement or the consummation of the
transactions contemplated by this Agreement, or if required, such approval
has been obtained prior to the Closing Date.
EXHIBIT A
Unless this Certificate is presented by an authorized representative of the
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN 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"), AND CERTAIN OTHER
ASSETS.
AS LONG AS THE INTEREST RATE SWAP AGREEMENT IS IN EFFECT, EACH BENEFICIAL OWNER
OF THIS CERTIFICATE, OR ANY INTEREST THEREIN, SHALL BE DEEMED TO HAVE
REPRESENTED THAT EITHER (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT
SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A
PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") MATERIALLY
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE, NOR A PERSON ACTING ON
BEHALF OF ANY SUCH PLAN OR ARRANGEMENT NOR USING THE ASSETS OF ANY SUCH PLAN OR
ARRANGEMENT OR (II) THE ACQUISITION AND HOLDING OF THIS CERTIFICATE ARE ELIGIBLE
FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER AT LEAST ONE OF PROHIBITED TRANSACTION
CLASS EXEMPTION ("PTCE") 00-00, XXXX 00-0, XXXX 91-38, PTCE 95-60 OR PTCE 96-23,
THE STATUTORY EXEMPTION UNDER SECTION 408(b)(17) OF ERISA AND SECTION 4975(d) OF
THE CODE OR A COMPARABLE EXEMPTION AVAILABLE UNDER SIMILAR LAW.
Certificate No. X-0-0
X-0-0
X-0-0
X-0-0
M-1-1
M-2-1
M-3-1
M-4-1
M-5-1
M-6-1
X-0-0
X-0-0
X-0-0
X-0-0
Cut-off Date : April 1, 2007
First Distribution Date : May 25, 2007
Initial Certificate Balance of this : $[___________]
Certificate ("Denomination")
Initial Certificate Balances of all : [A-1] $[363,740,000]
Certificates of this Class
[A-2] $[111,250,000]
[A-3] $[147,145,000]
[A-4] $[90,645,000]
[M-1] $[32,940,000]
[M-2] $[30,653,000]
[M-3] $[18,300,000]
[M-4] $[16,013,000]
[M-5] $[15,555,000]
[M-6] $[14,640,000]
[B-1] $[13,725,000]
[B-2] $[11,895,000]
[B-3] $[10,980,000]
[B-4] $[9,150,000]
CUSIP : [Class A-1] 638728 AA3
[Class A-2] 638728 AB1
[Class A-3] 638728 AC9
[Class A-4] 638728 AD7
[Class M-1] 638728 AE5
[Class M-2] 638728 AF2
[Class M-3] 638728 AG0
[Class M-4] 638728 AH8
[Class M-5] 000000 XX0
[Class M-6] 638728 AK1
[Class B-1] 638728 AL9
[Class B-2] 638728 AM7
[Class B-3] 638728 AN5
[Class B-4] 638728 AP0
ISIN : [Class A-1] US638728AA30
[Class A-2] US638728AB13
[Class A-3] US638728AC95
[Class A-4] US638728AD78
[Class M-1] US638728AE51
[Class M-2] US638728AF27
[Class M-3] US638728AG00
[Class M-4] US638728AH82
[Class M-5] US638728AJ49
[Class M-6] US638728AK12
[Class B-1] US638728AL94
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-2
Mortgage Pass Through Certificates, Series 2007 HE2
[Class A][Class M-][Class B-[1][2][3]]
evidencing a percentage interest in the distributions allocable
to the Certificates of the above-referenced Class.
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less
than the Certificate Balance as set forth herein. This Certificate does not
evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Master Servicer, the Securities Administrator, the Trustee or any
other party to the Agreement referred to below or any of their respective
affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or
insured by any governmental agency or instrumentality.
This certifies that CEDE & CO., is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate of the denominations of all
Certificates of the Class to which this Certificate belongs) in certain monthly
distributions pursuant to a Pooling and Servicing Agreement dated as of the
Cut-off Date specified above (the "Agreement") among Xxxxxx Xxxxxxx ABS Capital
I Inc., as depositor (the "Depositor"), Saxon Mortgage Services, Inc., as a
servicer ("Saxon" and the "Servicer"), Natixis Real Estate Capital Inc., as
unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank National Trust
Company, as trustee and custodian (in each such capacity, respectively, the
"Trustee" and the "Custodian") and Xxxxx Fargo Bank, National Association, as
securities administrator and master servicer (in each such capacity,
respectively, the "Securities Administrator" and the "Master Servicer"). To the
extent not defined herein, the capitalized terms used herein shall have the
meanings assigned 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 the acceptance hereof
assents and by which such Holder is bound.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Securities Administrator.
* * *
IN WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be duly executed.
Dated:
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Securities
Administrator
By:
--------------------------------------
Authenticated:
By
--------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Securities Administrator
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
This Certificate is one of a duly authorized issue of Certificates
designated as Natixis Real Estate Capital Trust 2007-HE2 Mortgage Pass-Through
Certificates, Series 2007-HE2 (herein collectively called the "Certificates"),
and representing a beneficial ownership interest in the Trust Fund created by
the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Securities Administrator is 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 thereby, and the rights,
duties and immunities of the Trustee and the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on the
first Distribution Date specified on the face hereof, to the Person in whose
name this Certificate is registered at the close of business on the applicable
Record Date in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount required to be distributed to
Holders of Certificates of the Class to which this Certificate belongs on such
Distribution Date pursuant to the Agreement. The Record Date applicable to each
Distribution Date is the Business Day immediately preceding such Distribution
Date; provided, however, that for any Definitive Certificates, the Record Date
shall be the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Securities Administrator in writing at least five
Business Days prior to the related Record Date and such Certificateholder shall
satisfy the conditions to receive such form of payment set forth in the
Agreement, or, if not, by check mailed by first class mail to the address of
such Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the offices designated by the
Securities Administrator for such purposes, or such other location specified in
the notice to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. 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 exchange therefor 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 in the
Certificate Register of the Securities Administrator upon surrender of this
Certificate for registration of transfer at the offices designated by the
Securities Administrator for such purposes, accompanied by a written instrument
of transfer in form satisfactory to the Securities Administrator and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust Fund will be issued to the designated
transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, 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 Servicer, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and 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 no such party shall be affected by any notice to
the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans, as of the last day of the related Due Period, is
less than or equal to 5% of the Maximum Pool Principal Balance, the Servicer
and/or the Class X Certificateholders will have the option to repurchase, in
whole, from the Trust Fund all remaining Mortgage Loans and all property
acquired in respect of the Mortgage Loans at a purchase price determined as
provided in the Agreement. The obligations and responsibilities created by the
Agreement will terminate as provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
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)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_______________________________________________________________________________.
________________________________________
Signature by or on behalf of assignor
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 _________________________________,
the assignee named above, or ________________________________________________,
as its agent.
EXHIBIT B
IF THIS CERTIFICATE IS A PHYSICAL CERTIFICATE, NEITHER THIS CERTIFICATE NOR ANY
INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE PROPOSED TRANSFEROR DELIVERS TO
THE SECURITIES ADMINISTRATOR A TRANSFEROR LETTER (THE "TRANSFEROR LETTER") IN
THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE
SECURITIES ADMINISTRATOR RECEIVES A RULE 144A LETTER (THE "144A LETTER") IN THE
FORM OF EXHIBIT J TO THE AGREEMENT REFERRED TO HEREIN OR (II) THE SECURITIES
ADMINISTRATOR RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE EXPENSE OF THE
TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED.
IF THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE, THE PROPOSED TRANSFEROR WILL BE
DEEMED TO HAVE MADE EACH OF THE CERTIFICATIONS SET FORTH IN THE TRANSFEROR
LETTER AND THE PROPOSED TRANSFEREE WILL BE DEEMED TO HAVE MADE EACH OF THE
CERTIFICATIONS SET FORTH IN THE RULE 144A LETTER, IN EACH CASE AS IF SUCH
CERTIFICATE WERE EVIDENCED BY A PHYSICAL CERTIFICATE
IF THIS CERTIFICATE IS A PHYSICAL CERTIFICATE, NEITHER THIS CERTIFICATE NOR ANY
INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE
SECURITIES ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT EITHER (I)
SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE
I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR
ANY FEDERAL, STATE OR LOCAL LAW MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS
OF ERISA OR THE CODE (EACH, A "PLAN"), AND IS NOT ACTING ON BEHALF OF ANY PLAN
OR USING THE ASSETS OF ANY PLAN TO ACQUIRE THIS CERTIFICATE, OR (II) SUCH
TRANSFEREE IS AN INSURANCE COMPANY AND IS PURCHASING THIS CERTIFICATE WITH FUNDS
CONTAINED IN AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH TERM IS DEFINED IN
SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60")) AND
THE CONDITIONS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND III OF PTCE 95-60 ARE
SATISFIED WITH RESPECT TO ITS PURCHASE AND HOLDING OF THIS CERTIFICATE. IF THIS
CERTIFICATE IS A BOOK-ENTRY CERTIFICATE, EACH TRANSFEREE WILL BE DEEMED TO HAVE
MADE THE FOREGOING REPRESENTATION.
Unless this Certificate is presented by an authorized representative of the
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
OWNERSHIP OF 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") AND CERTAIN OTHER
ASSETS.
Certificate No. : B-4-1
Cut-off Date : April 1, 2007
First Distribution Date : May 25, 2007
Initial Certificate Balance of this
Certificate ("Denomination") :
Initial Certificate Balances of all
Certificates of this Class :
CUSIP
ISIN :
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
Class B-4
evidencing a percentage interest in the distributions
allocable to the Certificates of the above-referenced
Class.
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less
than the Certificate Balance as set forth herein. This Certificate does not
evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Unaffiliated Seller, any Originator, the Servicer, the Securities
Administrator, the Master Servicer or the Trustee referred to below or any of
their respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.
This certifies that CEDE & CO., is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate of the denominations of all
Certificates of the Class to which this Certificate belongs) in certain monthly
distributions pursuant to a Pooling and Servicing Agreement dated as of the
Cut-off Date specified above (the "Agreement") among Xxxxxx Xxxxxxx ABS Capital
I Inc., as depositor (the "Depositor"), Saxon Mortgage Services, Inc., as a
servicer ("Saxon" and the "Servicer"), Natixis Real Estate Capital Inc., as
unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank National Trust
Company, as trustee and custodian (in each such capacity, respectively, the
"Trustee" and the "Custodian") and Xxxxx Fargo Bank, National Association, as
securities administrator and master servicer (in each such capacity,
respectively, the "Securities Administrator" and the "Master Servicer"). To the
extent not defined herein, the capitalized terms used herein shall have the
meanings assigned 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 the acceptance hereof
assents and by which such Holder is bound.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Securities Administrator.
* * *
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Securities Administrator
By: _____________________________________
Authenticated:
By:
------------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Certificate Registrar
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
This Certificate is one of a duly authorized issue of Certificates
designated as Natixis Real Estate Capital Trust 2007-HE2 Mortgage Pass-Through
Certificates, Series 2007-HE2 (herein collectively called the "Certificates"),
and representing a beneficial ownership interest in the Trust Fund created by
the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Securities Administrator is 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 thereby, and the rights,
duties and immunities of the Trustee and the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on the
first Distribution Date specified on the face hereof, to the Person in whose
name this Certificate is registered at the close of business on the applicable
Record Date in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount required to be distributed to
Holders of Certificates of the Class to which this Certificate belongs on such
Distribution Date pursuant to the Agreement. The Record Date applicable to each
Distribution Date is the Business Day immediately preceding such Distribution
Date; provided, however, that for any Definitive Certificates, the Record Date
shall be the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Securities Administrator in writing at least five
Business Days prior to the related Record Date and such Certificateholder shall
satisfy the conditions to receive such form of payment set forth in the
Agreement, or, if not, by check mailed by first class mail to the address of
such Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the offices designated by the
Securities Administrator for such purposes, or such other location specified in
the notice to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. 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 exchange therefor 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 in the
Certificate Register of the Securities Administrator upon surrender of this
Certificate for registration of transfer at the offices designated by the
Securities Administrator for such purposes, accompanied by a written instrument
of transfer in form satisfactory to the Securities Administrator and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust Fund will be issued to the designated
transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, 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 Servicer, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and 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 no such party shall be affected by any notice to
the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans, as of the last day of the related Due Period, is
less than or equal to 5% of the Maximum Pool Principal Balance, the Servicer
and/or the Class X Certificateholders will have the option to repurchase, in
whole, from the Trust Fund all remaining Mortgage Loans and all property
acquired in respect of the Mortgage Loans at a purchase price determined as
provided in the Agreement. The obligations and responsibilities created by the
Agreement will terminate as provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
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)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_______________________________________________________________________________.
________________________________________
Signature by or on behalf of assignor
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 _________________________________,
the assignee named above, or ________________________________________________,
as its agent.
EXHIBIT C
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFEROR
CERTIFICATE IN THE FORM OF EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND
EITHER (I) THE SECURITIES ADMINISTRATOR RECEIVES A RULE 144A LETTER IN THE FORM
OF EXHIBIT I TO THE AGREEMENT REFERRED TO HEREIN OR (II) THE SECURITIES
ADMINISTRATOR RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE EXPENSE OF THE
TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE SECURITIES ADMINISTRATOR A REPRESENTATION LETTER TO
THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE
I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
OR A PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO MATERIALLY
SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") OR
A PERSON INVESTING ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN. IN THE EVENT
THAT SUCH REPRESENTATION IS VIOLATED, OR ANY ATTEMPT IS MADE TO TRANSFER TO A
PLAN OR ARRANGEMENT SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO SECTION
4975 OF THE CODE OR A PLAN SUBJECT TO SIMILAR LAW, OR A PERSON ACTING ON BEHALF
OF ANY SUCH PLAN OR ARRANGEMENT OR USING THE ASSETS OF ANY SUCH PLAN OR
ARRANGEMENT, SUCH ATTEMPTED TRANSFER OR ACQUISITION SHALL BE VOID AND OF NO
EFFECT.
NO TRANSFER OF ANY CLASS P CERTIFICATES SHALL BE MADE UNLESS THE PROPOSED
TRANSFEREE OF SUCH CLASS P CERTIFICATE PROVIDES TO THE SECURITIES ADMINISTRATOR
THE APPROPRIATE TAX CERTIFICATION FORM (I.E., IRS FORM W-9 OR IRS FORM W-8BEN,
W-8IMY, W-8EXP OR W-8ECI, AS APPLICABLE (OR ANY SUCCESSOR FORM THERETO)) 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 SUCH FORM HAS BECOME OBSOLETE OR INCORRECT, AS A CONDITION TO SUCH
TRANSFER. UNDER THE AGREEMENT, UPON RECEIPT OF ANY SUCH TAX CERTIFICATION FORM
FROM A TRANSFEREE OF ANY CLASS P CERTIFICATE, THE SECURITIES ADMINISTRATOR SHALL
FORWARD SUCH TAX CERTIFICATION FORM PROVIDED TO IT TO THE SWAP PROVIDER AND THE
CAP PROVIDER. EACH HOLDER OF A CLASS P CERTIFICATE AND EACH TRANSFEREE THEREOF
SHALL BE DEEMED TO HAVE CONSENTED TO THE SECURITIES ADMINISTRATOR FORWARDING TO
THE SWAP PROVIDER AND THE CAP PROVIDER ANY SUCH TAX CERTIFICATION FORM IT HAS
PROVIDED AND UPDATED IN ACCORDANCE WITH THESE TRANSFER RESTRICTIONS. ANY
PURPORTED SALES OR TRANSFERS OF ANY CLASS P CERTIFICATE TO A TRANSFEREE WHICH
DOES NOT COMPLY WITH THESE REQUIREMENTS SHALL BE DEEMED NULL AND VOID UNDER THIS
AGREEMENT.
Certificate No. : P-1
Cut-off Date : April 1, 2007
First Distribution Date : May 25, 2007
Percentage Interest of this : 100%
Certificate ("Denominations")
CUSIP : N/A
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
Class P
evidencing a percentage interest in the distributions
allocable to the Certificates of the above-referenced
Class.
Distributions in respect of this Certificate are distributable monthly as set
forth herein. This Certificate does not evidence an obligation of, or an
interest in, and is not guaranteed by the Depositor, the Unaffiliated Seller,
the Securities Administrator, the Master Servicer, any Originator, the Servicer
or the Trustee referred to below or any of their respective affiliates. Neither
this Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that XXXXX FARGO BANK, NATIONAL ASSOCIATION, AS INDENTURE TRUSTEE
is the registered owner of the Percentage Interest evidenced by this Certificate
(obtained by dividing the denomination of this Certificate by the aggregate of
the denominations of all Certificates of the Class to which this Certificate
belongs) in certain monthly distributions pursuant to a Pooling and Servicing
Agreement dated as of the Cut-off Date specified above (the "Agreement") among
Xxxxxx Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor"), Saxon
Mortgage Services, Inc., as the servicer ("Saxon" and the "Servicer"), Natixis
Real Estate Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"),
Deutsche Bank National Trust Company, as trustee and custodian (in each such
capacity, respectively, the "Trustee" and the "Custodian") and Xxxxx Fargo Bank,
National Association, as securities administrator and master servicer (in each
such capacity, respectively, the "Securities Administrator" and the "Master
Servicer"). To the extent not defined herein, the capitalized terms used herein
have the meanings assigned 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 the acceptance
hereof assents and by which such Holder is bound.
This Certificate does not have a Certificate Balance or a Pass-Through Rate and
will be entitled to distributions only to the extent set forth in the Agreement.
In addition, any distribution of the proceeds of any remaining assets of the
Trust will be made only upon presentment and surrender of this Certificate at
the offices designated by the Securities Administrator for such purposes, or
such other location specified in the notice to Certificateholders of such final
distribution.
No transfer of a Certificate of this Class shall be made unless such disposition
is exempt from the registration requirements of the Securities Act of 1933, as
amended (the "1933 Act"), and any applicable state securities laws or is made in
accordance with the 1933 Act and such laws. In the event of any such transfer,
the Securities Administrator shall require the transferor to execute a
transferor certificate (in substantially the form attached to the Agreement) and
deliver either (i) a Rule 144A Letter, in either case substantially in the form
attached to the Agreement, or (ii) a written Opinion of Counsel to the
Securities Administrator that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from the
1933 Act or is being made pursuant to the 1933 Act, which Opinion of Counsel
shall be an expense of the transferor.
Except as provided in the Agreement, no transfer of a Certificate of this Class
shall be made unless the Securities Administrator shall have received a
representation letter from the transferee of this Certificate, acceptable to and
in form and substance satisfactory to the Securities Administrator, to the
effect that such transferee is not a Plan, and is not acting on behalf of any
Plan or using the assets of any Plan to effect such transfer. Any purported
transfer of a Certificate of this Class in violation of the transfer
restrictions set forth in the Agreement shall be void and of no effect.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose unless manually authenticated by an authorized signatory
of the Securities Administrator.
* * *
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Securities
Administrator
By: _____________________________________
Authenticated:
By:
-------------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Certificate Registrar
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
This Certificate is one of a duly authorized issue of Certificates designated as
Natixis Real Estate Capital Trust 2007-HE2 Mortgage Pass-Through Certificates,
Series 2007-HE2 (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it
will look solely to the funds on deposit in the Distribution Account for payment
hereunder and that the Securities Administrator is 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 thereby, and the rights, duties and
immunities of the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th
day of each month or, if such 25th day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified on the face hereof, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record Date
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to Holders of Certificates
of the Class to which this Certificate belongs on such Distribution Date
pursuant to the Agreement. The Record Date applicable to each Distribution Date
is the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of immediately
available funds to the account of the Holder hereof at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the notice
to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee, the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. 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 exchange therefor 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 in the Certificate
Register of the Securities Administrator upon surrender of this Certificate for
registration of transfer at the offices designated by the Securities
Administrator for such purposes, accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations and evidencing the same aggregate Percentage
Interest in the Trust Fund will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without coupons in
denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, 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 Servicer, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and 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 no such party shall be affected by any notice to
the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans, as of the last day of the related Due Period, is less than or
equal to 5% of the Maximum Pool Principal Balance, the Servicer and/or the Class
X Certificateholders will have the option to repurchase, in whole, from the
Trust Fund all remaining Mortgage Loans and all property acquired in respect of
the Mortgage Loans at a purchase price determined as provided in the Agreement.
The obligations and responsibilities created by the Agreement will terminate as
provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning.
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)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_______________________________________________________________________________.
________________________________________
Signature by or on behalf of assignor
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 _________________________________,
the assignee named above, or ________________________________________________,
as its agent.
EXHIBIT D-1
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS FIVE
"RESIDUAL INTERESTS" IN FIVE "REAL ESTATE MORTGAGE INVESTMENT CONDUITS," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
EXCEPT AS PROVIDED IN THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST
HEREIN MAY BE TRANSFERRED UNLESS THE PROPOSED TRANSFEREE DELIVERS TO THE
SECURITIES ADMINISTRATOR A TRANSFER AFFIDAVIT IN ACCORDANCE WITH THE PROVISIONS
OF THE AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST
HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE SECURITIES
ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT
AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), SECTION 4975 OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR ANY FEDERAL,
STATE OR LOCAL LAW MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR
THE CODE (EACH, A "PLAN"), AND IS NOT ACTING ON BEHALF OF ANY PLAN OR USING THE
ASSETS OF ANY PLAN TO EFFECT SUCH TRANSFER. ANY PURPORTED TRANSFER OF THIS
CERTIFICATE IN VIOLATION OF THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT
SHALL BE VOID AND OF NO EFFECT.
Certificate No. : R-1
Cut-off Date : April 1, 2007
First Distribution Date : May 25, 2007
Percentage Interest of this
Certificate ("Denomination") : 100%
CUSIP : N/A
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
Class R
evidencing a percentage interest in the distributions
allocable to the Certificates of the above-referenced
Class.
Distributions in respect of this Certificate is distributable monthly as set
forth herein. This Class R Certificate has no Certificate Balance and is not
entitled to distributions in respect of principal or interest. This Certificate
does not evidence an obligation of, or an interest in, and is not guaranteed by
the Depositor, the Unaffiliated Seller, the Securities Administrator, the Master
Servicer, any Originator, the Servicer or the Trustee referred to below or any
of their respective affiliates. Neither this Certificate nor the Mortgage Loans
are guaranteed or insured by any governmental agency or instrumentality.
This certifies that NATIXIS REAL ESTATE CAPITAL INC. is the registered owner of
the Percentage Interest specified above of any monthly distributions due to the
Class R Certificates pursuant to a Pooling and Servicing Agreement dated as of
the Cut-off Date specified above (the "Agreement") among Xxxxxx Xxxxxxx ABS
Capital I Inc., as depositor (the "Depositor"), Saxon Mortgage Services, Inc.,
as the servicer ("Saxon" and the "Servicer"), Natixis Real Estate Capital Inc.,
as unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank National Trust
Company, as trustee and custodian (in each such capacity, respectively, the
"Trustee" and the "Custodian") and Xxxxx Fargo Bank, National Association, as
securities administrator and master servicer (in each such capacity,
respectively, the "Securities Administrator" and the "Master Servicer"). To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned 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 the acceptance hereof assents and by
which such Holder is bound.
Any distribution of the proceeds of any remaining assets of the Trust Fund will
be made only upon presentment and surrender of this Class R Certificate at the
offices designated by the Securities Administrator for such purposes or such
other location specified in the notice to Certificateholders of such final
distribution.
Except as provided in the Agreement, no transfer of a Class R Certificate shall
be made unless the Securities Administrator shall have received a representation
letter from the transferee of this Certificate, acceptable to and in form and
substance satisfactory to the Securities Administrator, to the effect that such
transferee is not a Plan, and is not acting on behalf of any Plan or using the
assets of any Plan to effect such transfer. Any purported transfer of a Class R
Certificate in violation of the transfer restrictions set forth in the Agreement
shall be void and of no effect.
Each Holder of this Class R Certificate shall be deemed by the acceptance or
acquisition an Ownership Interest in this Class R Certificate to have agreed to
be bound by the following provisions, and the rights of each Person acquiring
any Ownership Interest in this Class R Certificate are expressly subject to the
following provisions: (i) each Person holding or acquiring any Ownership
Interest in this Class R 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 this
Class R Certificate may be registered on the Closing Date or thereafter
transferred, and the Securities Administrator shall not register the Transfer of
this Certificate unless, in addition to the certificates required to be
delivered to the Securities Administrator under Section 5.02(b) of the
Agreement, the Securities Administrator shall have been furnished with a
Transfer Affidavit of the initial owner or the proposed transferee in the form
attached as Exhibit H to the Agreement, (iii) each Person holding or acquiring
any Ownership Interest in this Class R Certificate shall agree (A) to obtain a
Transfer Affidavit from any other Person to whom such Person attempts to
Transfer its Ownership Interest this Class R 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 this Class R Certificate and
(C) not to Transfer the Ownership Interest in this Class R Certificate or to
cause the Transfer of the Ownership Interest in this Class R Certificate to any
other Person if it has actual knowledge that such Person is a Non-Permitted
Transferee and (iv) any attempted or purported Transfer of the Ownership
Interest in this Class R Certificate in violation of the provisions herein shall
be absolutely null and void and shall vest no rights in the purported
Transferee.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose unless manually authenticated by an authorized signatory
of the Securities Administrator.
IN WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be duly executed.
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Securities
Administrator
By: _____________________________________
Authenticated:
By:
-------------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Certificate Registrar
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
This Certificate is one of a duly authorized issue of Certificates designated as
Natixis Real Estate Capital Trust 2007-HE2 Mortgage Pass-Through Certificates,
Series 2007-HE2 (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it
will look solely to the funds on deposit in the Distribution Account for payment
hereunder and that the Securities Administrator is 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 thereby, and the rights, duties and
immunities of the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th
day of each month or, if such day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified on the face hereof, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record Date
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to Holders of Certificates
of the Class to which this Certificate belongs on such Distribution Date
pursuant to the Agreement. The Record Date applicable to each Distribution Date
is the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of immediately
available funds to the account of the Holder hereof at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the notice
to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee, the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. 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 exchange therefor 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 in the Certificate
Register of the Securities Administrator upon surrender of this Certificate for
registration of transfer at the offices designated by the Securities
Administrator for such purposes, accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations and evidencing the same aggregate Percentage
Interest in the Trust Fund will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without coupons in
denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, 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 Servicer, the Securities Administrator, the Master Servicer,
the Unaffiliated Seller and 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 no such party shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans, as of the last day of the related Due Period, is less than or
equal to 5% of the Maximum Pool Principal Balance, the Servicer and/or the Class
X Certificateholder will have the option to repurchase, in whole, from the Trust
Fund all remaining Mortgage Loans and all property acquired in respect of the
Mortgage Loans at a purchase price determined as provided in the Agreement. The
obligations and responsibilities created by the Agreement will terminate as
provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning.
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)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_______________________________________________________________________________.
________________________________________
Signature by or on behalf of assignor
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 _________________________________,
the assignee named above, or ________________________________________________,
as its agent.
EXHIBIT D-2
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS 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, AS AMENDED (THE "CODE").
EXCEPT AS PROVIDED IN THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST
HEREIN MAY BE TRANSFERRED UNLESS THE PROPOSED TRANSFEREE DELIVERS TO THE
SECURITIES ADMINISTRATOR A TRANSFER AFFIDAVIT IN ACCORDANCE WITH THE PROVISIONS
OF THE AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST
HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE SECURITIES
ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT
AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), SECTION 4975 OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR ANY FEDERAL,
STATE OR LOCAL LAW MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR
THE CODE (EACH, A "PLAN"), AND IS NOT ACTING ON BEHALF OF ANY PLAN OR USING THE
ASSETS OF ANY PLAN TO EFFECT SUCH TRANSFER. ANY PURPORTED TRANSFER OF THIS
CERTIFICATE IN VIOLATION OF THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT
SHALL BE VOID AND OF NO EFFECT.
Certificate No. : RX-1
Cut-off Date : April 1, 2007
First Distribution Date : May 25, 2007
Percentage Interest of this
Certificate ("Denomination") : 100%
CUSIP : N/A
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
Class RX
evidencing a percentage interest in the distributions
allocable to the Certificates of the above-referenced
Class.
Distributions in respect of this Certificate is distributable monthly as set
forth herein. This Class RX Certificate has no Certificate Balance and is not
entitled to distributions in respect of principal or interest. This Certificate
does not evidence an obligation of, or an interest in, and is not guaranteed by
the Depositor, the Unaffiliated Seller, the Securities Administrator, the Master
Servicer, any Originator, the Servicer or the Trustee referred to below or any
of their respective affiliates. Neither this Certificate nor the Mortgage Loans
are guaranteed or insured by any governmental agency or instrumentality.
This certifies that NATIXIS REAL ESTATE CAPITAL INC. is the registered owner of
the Percentage Interest specified above of any monthly distributions due to the
Class RX Certificates pursuant to a Pooling and Servicing Agreement dated as of
the Cut-off Date specified above (the "Agreement") among Xxxxxx Xxxxxxx ABS
Capital I Inc., as depositor (the "Depositor"), Saxon Mortgage Services, Inc.,
as the servicer ("Saxon" and the "Servicer"), Natixis Real Estate Capital Inc.,
as unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank National Trust
Company, as trustee and custodian (in each such capacity, respectively, the
"Trustee" and the "Custodian") and Xxxxx Fargo Bank, National Association, as
securities administrator and master servicer (in each such capacity,
respectively, the "Securities Administrator" and the "Master Servicer"). To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned 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 the acceptance hereof assents and by
which such Holder is bound.
Any distribution of the proceeds of any remaining assets of the Trust Fund will
be made only upon presentment and surrender of this Class RX Certificate at the
offices designated by the Securities Administrator for such purposes or such
other location specified in the notice to Certificateholders of such final
distribution.
Except as provided in the Agreement, no transfer of a Class RX Certificate shall
be made unless the Securities Administrator shall have received a representation
letter from the transferee of this Certificate, acceptable to and in form and
substance satisfactory to the Securities Administrator, to the effect that such
transferee is not a Plan, and is not acting on behalf of any Plan or using the
assets of any Plan to effect such transfer. Any purported transfer of a Class RX
Certificate in violation of the transfer restrictions set forth in the Agreement
shall be void and of no effect.
Each Holder of this Class RX Certificate shall be deemed by the acceptance or
acquisition an Ownership Interest in this Class RX Certificate to have agreed to
be bound by the following provisions, and the rights of each Person acquiring
any Ownership Interest in this Class RX Certificate are expressly subject to the
following provisions: (i) each Person holding or acquiring any Ownership
Interest in this Class RX 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 this
Class RX Certificate may be registered on the Closing Date or thereafter
transferred, and the Securities Administrator shall not register the Transfer of
this Certificate unless, in addition to the certificates required to be
delivered to the Securities Administrator under Section 5.02(b) of the
Agreement, the Securities Administrator shall have been furnished with a
Transfer Affidavit of the initial owner or the proposed transferee in the form
attached as Exhibit H to the Agreement, (iii) each Person holding or acquiring
any Ownership Interest in this Class RX Certificate shall agree (A) to obtain a
Transfer Affidavit from any other Person to whom such Person attempts to
Transfer its Ownership Interest this Class RX 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 this Class RX Certificate
and (C) not to Transfer the Ownership Interest in this Class RX Certificate or
to cause the Transfer of the Ownership Interest in this Class RX Certificate to
any other Person if it has actual knowledge that such Person is a Non-Permitted
Transferee and (iv) any attempted or purported Transfer of the Ownership
Interest in this Class RX Certificate in violation of the provisions herein
shall be absolutely null and void and shall vest no rights in the purported
Transferee.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose unless manually authenticated by an authorized signatory
of the Securities Administrator.
IN WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be duly executed.
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Securities
Administrator
By: _____________________________________
Authenticated:
By:
-------------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Certificate Registrar
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
This Certificate is one of a duly authorized issue of Certificates designated as
Natixis Real Estate Capital Trust 2007-HE2 Mortgage Pass-Through Certificates,
Series 2007-HE2 (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it
will look solely to the funds on deposit in the Distribution Account for payment
hereunder and that the Securities Administrator is 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 thereby, and the rights, duties and
immunities of the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th
day of each month or, if such day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified on the face hereof, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record Date
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to Holders of Certificates
of the Class to which this Certificate belongs on such Distribution Date
pursuant to the Agreement. The Record Date applicable to each Distribution Date
is the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of immediately
available funds to the account of the Holder hereof at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the notice
to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee, the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. 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 exchange therefor 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 in the Certificate
Register of the Securities Administrator upon surrender of this Certificate for
registration of transfer at the offices designated by the Securities
Administrator for such purposes, accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations and evidencing the same aggregate Percentage
Interest in the Trust Fund will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without coupons in
denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, 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 Servicer, the Securities Administrator, the Master Servicer,
the Unaffiliated Seller and 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 no such party shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans, as of the last day of the related Due Period, is less than or
equal to 5% of the Maximum Pool Principal Balance, the Servicer and/or the Class
X Certificateholder will have the option to repurchase, in whole, from the Trust
Fund all remaining Mortgage Loans and all property acquired in respect of the
Mortgage Loans at a purchase price determined as provided in the Agreement. The
obligations and responsibilities created by the Agreement will terminate as
provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning.
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)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_______________________________________________________________________________.
________________________________________
Signature by or on behalf of assignor
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 _________________________________,
the assignee named above, or ________________________________________________,
as its agent.
EXHIBIT E
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN THREE "REGULAR INTERESTS" 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"), AND CERTAIN OTHER
ASSETS.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFEROR
CERTIFICATE IN THE FORM OF EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND
EITHER (I) THE SECURITIES ADMINISTRATOR RECEIVES A RULE 144A LETTER IN THE FORM
OF EXHIBIT I TO THE AGREEMENT REFERRED TO HEREIN OR (II) THE SECURITIES
ADMINISTRATOR RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE EXPENSE OF THE
TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED.
EXCEPT AS PROVIDED IN THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST
HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE SECURITIES
ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT
AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), SECTION 4975 OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR ANY FEDERAL,
STATE OR LOCAL LAW MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR
THE CODE (EACH, A "PLAN"), AND IS NOT ACTING ON BEHALF OF ANY PLAN OR USING THE
ASSETS OF ANY PLAN TO EFFECT SUCH TRANSFER, ANY PURPORTED TRANSFER OF THIS
CERTIFICATE IN VIOLATION OF THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT
SHALL BE VOID AND OF NO EFFECT.
NO TRANSFER OF ANY CLASS X CERTIFICATES SHALL BE MADE UNLESS THE PROPOSED
TRANSFEREE OF SUCH CLASS X CERTIFICATE PROVIDES TO THE SECURITIES ADMINISTRATOR
THE APPROPRIATE TAX CERTIFICATION FORM (I.E., IRS FORM W-9 OR IRS FORM W-8BEN,
W-8IMY, W-8EXP OR W-8ECI, AS APPLICABLE (OR ANY SUCCESSOR FORM THERETO)) 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 SUCH FORM HAS BECOME OBSOLETE OR INCORRECT, AS A CONDITION TO SUCH
TRANSFER. UNDER THE AGREEMENT, UPON RECEIPT OF ANY SUCH TAX CERTIFICATION FORM
FROM A TRANSFEREE OF ANY CLASS X CERTIFICATE, THE SECURITIES ADMINISTRATOR SHALL
FORWARD SUCH TAX CERTIFICATION FORM PROVIDED TO IT TO THE SWAP PROVIDER AND THE
CAP PROVIDER. EACH HOLDER OF A CLASS X CERTIFICATE AND EACH TRANSFEREE THEREOF
SHALL BE DEEMED TO HAVE CONSENTED TO THE SECURITIES ADMINISTRATOR FORWARDING TO
THE SWAP PROVIDER AND THE CAP PROVIDER ANY SUCH TAX CERTIFICATION FORM IT HAS
PROVIDED AND UPDATED IN ACCORDANCE WITH THESE TRANSFER RESTRICTIONS. ANY
PURPORTED SALES OR TRANSFERS OF ANY CLASS X CERTIFICATE TO A TRANSFEREE WHICH
DOES NOT COMPLY WITH THESE REQUIREMENTS SHALL BE DEEMED NULL AND VOID UNDER THIS
AGREEMENT.
Certificate No. : X-1
Cut-off Date : April 1, 2007
First Distribution Date : May 25, 2007
Percentage Interest of this
Certificate ("Denomination") : 100%
CUSIP : N/A
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
Class X
evidencing a percentage interest in the distributions
allocable to the Certificates of the above-referenced
Class.
Distributions in respect of this Certificate are distributable monthly as set
forth herein. This Certificate does not evidence an obligation of, or an
interest in, and is not guaranteed by the Depositor, the Unaffiliated Seller,
the Securities Administrator, the Master Servicer, any Originator, the Servicer
or the Trustee referred to below or any of their respective affiliates. Neither
this Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that XXXXX FARGO BANK, NATIONAL ASSOCIATION, AS INDENTURE TRUSTEE
is the registered owner of the Percentage Interest evidenced by this Certificate
(obtained by dividing the denomination of this Certificate by the aggregate of
the denominations of all Certificates of the Class to which this Certificate
belongs) in certain monthly distributions pursuant to a Pooling and Servicing
Agreement dated as of the Cut-off Date specified above (the "Agreement") among
Xxxxxx Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor"), Saxon
Mortgage Services, Inc., as the servicer ("Saxon" and the "Servicer"), Natixis
Real Estate Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"),
Deutsche Bank National Trust Company, as trustee and custodian (in each such
capacity, respectively, the "Trustee" and the "Custodian") and Xxxxx Fargo Bank,
National Association, as securities administrator and master servicer (in each
such capacity, respectively, the "Securities Administrator" and the "Master
Servicer"). To the extent not defined herein, the capitalized terms used herein
have the meanings assigned 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 the acceptance
hereof assents and by which such Holder is bound.
This Certificate does not have a Certificate Balance or a Pass-Through Rate and
will be entitled to distributions only to the extent set forth in the Agreement.
In addition, any distribution of the proceeds of any remaining assets of the
Trust will be made only upon presentment and surrender of this Certificate at
the offices designated by the Securities Administrator for such purposes, or
such other location specified in the notice to Certificateholders of such final
distribution.
No transfer of a Certificate of this Class shall be made unless such disposition
is exempt from the registration requirements of the Securities Act of 1933, as
amended (the "1933 Act"), and any applicable state securities laws or is made in
accordance with the 1933 Act and such laws. In the event of any such transfer,
the Securities Administrator shall require the transferor to execute a
transferor certificate (in substantially the form attached to the Agreement) and
deliver either (i) a Rule 144A Letter, in either case substantially in the form
attached to the Agreement, or (ii) a written Opinion of Counsel to the
Securities Administrator that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from the
1933 Act or is being made pursuant to the 1933 Act, which Opinion of Counsel
shall be an expense of the transferor.
Except as provided in the Agreement, no transfer of a Certificate of this Class
shall be made unless the Securities Administrator shall have received a
representation letter from the transferee of this Certificate, acceptable to and
in form and substance satisfactory to the Securities Administrator, to the
effect that such transferee is not a Plan, and is not acting on behalf of any
Plan or using the assets of any Plan to effect such transfer. Any purported
transfer of a Certificate of this Class in violation of the transfer
restrictions set forth in the Agreement shall be void and of no effect.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose unless manually authenticated by an authorized signatory
of the Securities Administrator.
* * *
IN WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be duly executed.
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Securities
Administrator
By: _____________________________________
Authenticated:
By:
------------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Certificate Registrar
XXXXXX XXXXXXX ABS CAPITAL I INC.
Natixis Real Estate Capital Trust 2007-HE2
Mortgage Pass-Through Certificates, Series 2007-HE2
This Certificate is one of a duly authorized issue of Certificates designated as
Natixis Real Estate Capital Trust 2007-HE2 Mortgage Pass-Through Certificates,
Series 2007-HE2 (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it
will look solely to the funds on deposit in the Distribution Account for payment
hereunder and that the Securities Administrator is 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 thereby, and the rights, duties and
immunities of the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th
day of each month or, if such 25th day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified on the face hereof, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record Date
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to Holders of Certificates
of the Class to which this Certificate belongs on such Distribution Date
pursuant to the Agreement. The Record Date applicable to each Distribution Date
is the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of immediately
available funds to the account of the Holder hereof at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the notice
to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee, the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. 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 exchange therefor 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 in the Certificate
Register of the Securities Administrator upon surrender of this Certificate for
registration of transfer at the offices designated by the Securities
Administrator for such purposes, accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations and evidencing the same aggregate Percentage
Interest in the Trust Fund will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without coupons in
denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, 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 Servicer, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and 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 no such party shall be affected by any notice to
the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans, as of the last day of the related Due Period, is less than or
equal to 5% of the Maximum Principal Balance, the Servicer and/or the Class X
Certificateholders will have the option to repurchase, in whole, from the Trust
Fund all remaining Mortgage Loans and all property acquired in respect of the
Mortgage Loans at a purchase price determined as provided in the Agreement. The
obligations and responsibilities created by the Agreement will terminate as
provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning.
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)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_______________________________________________________________________________.
________________________________________
Signature by or on behalf of assignor
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 _________________________________,
the assignee named above, or ________________________________________________,
as its agent.
EXHIBIT F
FORM OF INITIAL CERTIFICATION OF CUSTODIAN
[date]
Xxxxxx Xxxxxxx ABS Capital I Inc.
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Saxon Mortgage Services, Inc.
0000 Xxxxxxxxxx Xxxxx,
Xxxx Xxxxx, Xxxxx 00000
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Deutsche Bank National Trust Company
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000-0000
Re: Pooling and Servicing Agreement, dated as of April 1, 2007 (the
"Pooling and Servicing Agreement"), among Natixis Real Estate
Capital Inc., as unaffiliated seller, Saxon Mortgage Services, Inc.,
as servicer, Xxxxx Fargo Bank, National Association, as securities
administrator and master servicer, and Deutsche Bank National Trust
Company, as trustee and custodian of the Natixis Real Estate Capital
Trust 2007-HE2
--------------------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and Servicing
Agreement, for each Mortgage Loan listed in the Mortgage Loan Schedule (other
than any Mortgage Loan listed in the attached schedule), it has received:
(i) the original Mortgage Note, endorsed as provided in the
following form: "Pay to the order of ________, without recourse"; and
(ii) an executed assignment of the Mortgage (which may be included
in a blanket assignment or assignments) except for the MERS Designated
Mortgage Loans.
Based on its review and examination and only as to the foregoing documents, such
documents appear regular on their face and related to such Mortgage Loan.
The Custodian has made no independent examination of any documents contained in
each Mortgage File beyond the review specifically required in the Pooling and
Servicing Agreement. The Custodian makes no representations as to: (i) the
validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in each Mortgage File of any of the Mortgage Loans
identified on the Mortgage Loan Schedule, or (ii) the collectibility,
insurability, perfection, priority, effectiveness or suitability of any such
Mortgage Loan. Notwithstanding anything herein to the contrary, the Custodian
has made no determination and makes no representations as to whether (i) any
endorsement is sufficient to transfer all right, title and interest of the party
so endorsing, as Noteholder or assignee thereof, in and to that Mortgage Note or
(ii) any assignment is in recordable form or sufficient to effect the assignment
of and transfer to the assignee thereof, under the Mortgage to which the
assignment relates.
Capitalized words and phrases used herein shall have the respective meanings
assigned to them in the Pooling and Servicing Agreement.
DEUTSCHE BANK NATIONAL
TRUST COMPANY,
as Custodian
By: _____________________________________
Name:
Title:
EXHIBIT G
FORM OF FINAL CERTIFICATION OF CUSTODIAN
[date]
Xxxxxx Xxxxxxx ABS Capital I Inc.
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Saxon Mortgage Services, Inc.
0000 Xxxxxxxxxx Xxxxx,
Xxxx Xxxxx, Xxxxx 00000
Natixis Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Deutsche Bank National Trust Company
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000-0000
Re: Pooling and Servicing Agreement, dated as of April 1, 2007, among
Xxxxxx Xxxxxxx ABS Capital I Inc., as Depositor, Saxon Mortgage
Services, Inc., as the Servicer, Natixis Real Estate Capital Inc.,
as Unaffiliated Seller, Deutsche Bank National Trust Company, as
Trustee and Custodian and Xxxxx Fargo Bank, National Association, as
Securities Administrator and Master Servicer, Natixis Real Estate
Capital Trust Series 2007-HE2
--------------------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), the undersigned, as
Custodian, hereby certifies that as to each Mortgage Loan listed in the Mortgage
Loan Schedule (other than any Mortgage Loan paid in full or listed on the
attached Document Exception Report) it has received:
(i) The original Mortgage Note, endorsed in the form provided in
Section 2.01 of the Pooling and Servicing Agreement, with all intervening
endorsements showing a complete chain of endorsement from the originator to the
last endorsee.
(ii) The original recorded Mortgage.
(iii) Except with respect to MERS Designated Mortgage Loans, an
executed assignment of the Mortgage in the form provided in Section 2.01 of the
Pooling and Servicing Agreement; or, if the Unaffiliated Seller has certified
that the related Mortgage has not been returned from the applicable recording
office, a copy of the assignment of the Mortgage (excluding information to be
provided by the recording office).
(iv) Except with respect to MERS Designated Mortgage Loans, the
original or duplicate original recorded assignment or assignments of the
Mortgage showing a complete chain of assignment from the originator to the last
endorsee.
(v) The original or duplicate lender's title policy and all riders
thereto or, if such original is unavailable, any one of an original title
binder, an original preliminary title report, or an original of the title
commitment, or a copy thereof certified by the title company.
Based on its review and examination and only as to the foregoing documents, (a)
such documents appear regular on their face and related to such Mortgage Loan,
and (b) the information set forth in items (1), (2) and (18) of the Mortgage
Loan Schedule and items (1), (9) and (17) of the Data Tape Information
accurately reflects information set forth in the Custodial File.
The Custodian has made no independent examination of any documents contained in
each Mortgage File beyond the review of the Custodial File specifically required
in the Pooling and Servicing Agreement. The Custodian makes no representations
as to: (i) the validity, legality, sufficiency, enforceability or genuineness of
any of the documents contained in each Mortgage File of any of the Mortgage
Loans identified on the Mortgage Loan Schedule, or (ii) the collectibility,
insurability, perfection, priority, effectiveness or suitability of any such
Mortgage Loan. Notwithstanding anything herein to the contrary, the Custodian
has made no determination and makes no representations as to whether (i) any
endorsement is sufficient to transfer all right, title and interest of the party
so endorsing, as Noteholder or assignee thereof, in and to that Mortgage Note or
(ii) any assignment is in recordable form or sufficient to effect the assignment
of and transfer to the assignee thereof, under the Mortgage to which the
assignment relates.
Capitalized words and phrases used herein shall have the respective meanings
assigned to them in the Pooling and Servicing Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Custodian,
By: ________________________________________
Name:
Title:
EXHIBIT H
RESIDUAL TRANSFER AFFIDAVIT
Natixis REAL ESTATE CAPITAL Trust 2007-HE2,
Mortgage Pass-Through Certificates,
Series 2007-HE2
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of ___________________, the proposed Transferee
of an Ownership Interest in a Class [R][RX] Certificate (the "Certificate")
issued pursuant to the Pooling and Servicing Agreement dated as of April 1, 2007
(the "Agreement"), relating to the above-referenced Series, by and among Xxxxxx
Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor"), Saxon Mortgage
Services Inc., as the servicer ("Saxon" and the "Servicer"), Natixis Real Estate
Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank
National Trust Company, as trustee and custodian (in each such capacity,
respectively, the "Trustee" and the "Custodian") and Xxxxx Fargo Bank, National
Association, as securities administrator and master servicer (in each such
capacity, respectively, the "Securities Administrator" and the "Master
Servicer"). Capitalized terms used, but not defined herein or in Exhibit 1
hereto, shall have the meanings ascribed to such terms in the Agreement. The
Transferee has authorized the undersigned to make this affidavit on behalf of
the Transferee for the benefit of the Depositor and the Securities
Administrator.
2. The Transferee is not, as of the date hereof, and will not be, as of the date
of the Transfer, a "disqualified organization" within the meaning of Section
860E(e)(5) of the Internal Revenue Code of 1986. The Transferee will endeavor to
remain other than a disqualified organization for so long as it retains its
Ownership Interest in the Certificate.
3. The Transferee has historically paid its debts as they came due and will
continue to pay its debts as they come due in the future.
4. The Transferee has no present knowledge or expectation that it will be unable
to pay any United States taxes owed by it or become insolvent or subject to a
bankruptcy proceeding for so long as the Certificate remains outstanding.
5. The Transferee has been advised of, and understands that as the holder of a
noneconomic residual interest it may incur tax liabilities in excess of any cash
flows generated by the interest. The Transferee intends to pay such taxes
associated with holding the Certificate as they become due.
6. The Transferee will not cause income from the Certificate to be attributable
to a foreign permanent establishment or fixed base (within the meaning of an
applicable income tax treaty) of the Transferee or another U.S. taxpayer.
(1)7. [A. Formula Test] The Transferee agrees that the present value of the
anticipated tax liabilities associated with holding the Certificate does not
exceed the sum of the present value of any consideration given to the Transferee
to acquire the Certificate, the present value of the expected future
distributions on the Certificate, and the present value of the anticipated tax
savings associated with holding the interest as the REMIC generates losses. The
Transferee agrees that it complied with U.S. Treasury regulations section
1.860E-1(c)(8) in making such representation.
The Transferee agrees that it is not a foreign permanent
establishment or fixed base (within the meaning of an applicable income tax
treaty) of the Transferor or another U.S. taxpayer.
[B. Asset Test] The Transferee, at the time of the transfer, and at
the close of the Transferee's two fiscal years preceding the year of the
transfer, had gross assets for financial reporting purposes in excess of $100
million and net assets in excess of $10 million (excluding any obligation of a
person related to the Transferee within the meaning of U.S. Treasury regulations
section 1.860E-1(c)(6)(ii) or any other asset if a principle purpose for holding
or acquiring the other asset was to permit the Transferee to satisfy the above
stated minimum asset requirements).
The Transferee is an "eligible corporation," as defined in U.S. Treasury
regulations section 1.860E-1(c)(6)(i). The Transferee agrees, in connection with
any subsequent transfer of its Ownership Interest in the Certificate, to
transfer its Ownership Interest only to another "eligible corporation," as
defined in U.S. Treasury regulations section 1.860E-1(c)(6)(i), and to honor the
restrictions on subsequent transfers of the Certificate by transferring its
Ownership Interest only in a transaction that satisfies the requirements of U.S.
Treasury regulations section 1.860E-1(c)(4)(i), (ii) (iii) and U.S. Treasury
regulations section 1.860E-1(c)(5).
The Transferee determined the consideration paid to it to acquire the
Certificate in good faith and based on reasonable market assumptions (including,
but not limited to, borrowing and investment rates, prepayment and loss
assumptions, expense and reinvestment assumptions, tax rates and other factors
specific to the Transferee).
8. The Transferee is a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in, or under the laws of, the
United States or any political subdivision thereof, or an estate or trust whose
income from sources without the United States is includable 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.
9. The Transferee's taxpayer identification number is ____________.
10. The Transferee is not a Plan and is not acting on behalf of any Plan, or
using the assets of any Plan to effect the Transfer.
11. The Transferee has reviewed the provisions of Section 5.02(c) of the
Agreement and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificate, including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Section 5.02(c) of the Agreement and the
restrictions noted on the face of the Certificate. The Transferee understands
and agrees that any breach of any of the representations included herein shall
render the Transfer to the Transferee contemplated hereby null and void.
12. The Transferee consents to any additional restrictions or arrangements that
shall be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that the Certificate will only be owned, directly or
indirectly, by a Transferee that is not a disqualified organization.
13. The Transferee will not transfer its interest in the Certificate for the
purpose of impeding the assessment or collection of any tax.
14. The Transferee will not transfer such Certificate unless (i) it has received
from any subsequent transferee an affidavit in substantially the same form as
this affidavit containing the same representations set forth herein, and (ii) as
of the time of the transfer, it does not have actual knowledge that such
affidavit is false. The Transferee will deliver such affidavit to the Securities
Administrator upon receipt.
* * *
-------------
(1) Insert either section 7A or 7B.
IN WITNESS WHEREOF, the Transferee has caused this instrument to be executed
on its behalf, pursuant to authority of its Board of Directors, by its duly
authorized officer and its corporate seal to be hereunto affixed, duly
attested, this __ day of ________, 20__.
Print Name of Transferee
By: _____________________________________
Name:
Title:
[Corporate Seal]
ATTEST:
[Assistant] Secretary
Personally appeared before me the above-named __________, known or proved to me
to be the same person who executed the foregoing instrument and to be the
___________ of the Transferee, and acknowledged that he executed the same as his
free act and deed and the free act and deed of the Transferee.
Subscribed and sworn before me this __ day of ________, 20__.
NOTARY PUBLIC
My Commission expires the __ day
of _________, 20__
EXHIBIT I
FORM OF TRANSFEROR CERTIFICATE
__________, 20__
Xxxxxx Xxxxxxx ABS Capital I Inc.
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Re: Natixis Real Estate Capital Trust, Series 2007-HE2, Mortgage
Pass-Through Certificates, Series 2007-HE2, Class
------------------------------------------------------------
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we certify that (a)
we understand that the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act"), and are being disposed by us in
a transaction that is exempt from the registration requirements of the Act, (b)
we have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Act and (c)
to the extent we are disposing of a Residual Certificate, we have no knowledge
the Transferee is a Non-Permitted Transferee, (ii) after conducting a reasonable
investigation of the financial condition of the Transferee, we have no knowledge
and no reason to believe that the Transferee will not pay all taxes with respect
to the Residual Certificates as they become due and (iii) we have no reason to
believe that the statements made in paragraphs 7, 10 and 11 of the Transferee's
Residual Transfer Affidavit are false.
Very truly yours,
____________________________________________
Print Name of Transferor
By: ________________________________________
Authorized Officer
EXHIBIT J
FORM OF RULE 144A LETTER
____________, 20__
Xxxxxx Xxxxxxx ABS Capital I Inc.
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Re: Natixis Real Estate Capital Trust, Series 2007-HE2, Mortgage
Pass-Through Certificates, Series 2007-HE2, Class___
------------------------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we
certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "Act"), or any state
securities laws and are being transferred to us in a transaction that is exempt
from the registration requirements of the Act and any such laws, (b) we have
such knowledge and experience in financial and business matters that we are
capable of evaluating the merits and risks of investments in the Certificates,
(c) we have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) either (i) we are not an employee benefit plan or
arrangement that is subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), Section 4975 of the Internal Revenue
Code of 1986, as amended (the "Code"), or any federal, state or local law
materially similar to the foregoing provisions of ERISA or the Code (each, a
"Plan"), and we are not acting on behalf of any Plan or using the assets of any
Plan to effect our purchase of the Certificates or (ii) with respect to any
Certificates other than Class P, Class R, Class RX and Class X Certificates, we
are an insurance company and are purchasing the Certificates with funds
contained in an "insurance company general account" (as defined term is defined
in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")),
and the conditions for exemptive relief under Sections I and III of PTCE 95-60
are satisfied with respect to our purchase and holding of the Certificates, (e)
we have not, nor has anyone acting on our behalf offered, transferred, pledged,
sold or otherwise disposed of the Certificates, any interest in the Certificates
or any other similar security to, or solicited any offer to buy or accept a
transfer, pledge or other disposition of the Certificates, any interest in the
Certificates or any other similar security from, or otherwise approached or
negotiated with respect to the Certificates, any interest in the Certificates or
any other similar security 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, that would constitute a distribution of the Certificates under
the Securities Act or that would render the disposition of the Certificates a
violation of Section 5 of the Securities Act or require registration pursuant
thereto, nor will act, nor has authorized or will authorize any person to act,
in such manner with respect to the Certificates, and (f) we are a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act and have completed either of the forms of certification to that effect
attached hereto as Annex 1 or Annex 2. We are aware that the sale to us is being
made in reliance on Rule 144A. We are acquiring the Certificates for our own
account or for resale pursuant to Rule 144A and further, understand that such
Certificates may be resold, pledged or transferred only (i) to 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 on Rule
144A, or (ii) pursuant to another exemption from registration under the
Securities Act.
In connection with our purchase of the Certificates, we acknowledge
and agree that (i) none of you nor any of your affiliates is acting as a
fiduciary or financial or investment adviser for us; (ii) we are not relying
(for purposes of making any investment decision or otherwise) upon any advice,
counsel or representations (whether written or oral) of any of you or your
affiliates with respect to the Certificates; (iii) none of you nor any of your
affiliates has given to us (directly or indirectly through any other person) any
assurance, guarantee or representation whatsoever as to the expected or
projected success, profitability, return, performance, result, effect,
consequence, or benefit (including legal, regulatory, tax, financial, accounting
or otherwise) of our purchase of the Certificates; (iv) we have performed our
own diligence to the extent we have deemed necessary and we have consulted with
our own legal, regulatory, tax, business, investment, financial and accounting
advisers to the extent that we have deemed necessary, and we have made our own
investment decisions based upon our own judgment and upon any advice from such
advisers as we have deemed necessary and appropriate and not upon any view
expressed by any of you or your affiliates with respect to the Certificates; (v)
none of you nor any of your affiliates will be obligated to make payments on the
Certificates in the event that the assets of the trust is insufficient to
provide for such payments; (vi) you and your affiliates may have positions and
may effect transactions in any of the Series 2007-HE2 securities; and (vii) we
are familiar with the Certificates and have reviewed and understand the related
pooling and servicing agreement, the prospectus supplement and prospectus
relating to Series 2007-HE2 and the other material transaction documents related
thereto.
The Transferee's taxpayer identification number is __________. The
Transferee attaches hereto Forms W-8ECI, W-8BEN, W-8IMY (and all appropriate
attachments) or W-9. The Transferee hereby consents to the attached Forms being
provided to the Swap Provider and the Cap Provider.
ANNEX 1 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the parties listed
in the Rule 144A Transferee Certificate to which this certification relates with
respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief Financial
Officer, Senior Vice President or other executive officer of the Buyer.
2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned and/or
invested on a discretionary basis $_________ in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.
Corporation, etc. The Buyer is a corporation (other
than a bank, savings and loan association or similar
institution), Massachusetts or similar business
trust, partnership, or charitable organization
described in Section 501(c)(3) of the Internal
Revenue Code of 1986, as amended.
Bank. The Buyer (a) is a national bank or banking
institution organized under the laws of any State,
territory or the District of Columbia, the business
of which is substantially confined to banking and is
supervised by the State or territorial banking
commission or similar official or is a foreign bank
or equivalent institution, and (b) has an audited net
worth of at least $25,000,000 as demonstrated in its
latest annual financial statements, a copy of which
is attached hereto.
Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association,
cooperative bank, homestead association or similar
institution, which is supervised and examined by a
State or Federal authority having supervision over
any such institutions or is a foreign savings and
loan association or equivalent institution and (b)
has an audited net worth of at least $25,000,000 as
demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
Broker-dealer. The Buyer is a dealer registered
pursuant to Section 15 of the Securities Exchange Act
of 1934.
Insurance Company. The Buyer is an insurance company
whose primary and predominant business activity is
the writing of insurance or the reinsuring of risks
underwritten by insurance companies and which is
subject to supervision by the insurance commissioner
or a similar official or agency of a State, territory
or the District of Columbia.
State or Local Plan. The Buyer is a plan established
and maintained by a State, its political
subdivisions, or any agency or instrumentality of the
State or its political subdivisions, for the benefit
of its employees.
ERISA Plan. The Buyer is an employee benefit plan
within the meaning of Title I of the Employee
Retirement Income Security Act of 1974.
Investment Advisor. The Buyer is an investment
advisor registered under the Investment Advisors Act
of 1940.
Small Business Investment Company. Buyer is 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.
Business Development Company. Buyer is a business
development company as defined in Section 202(a)(22)
of the Investment Advisors Act of 1940.
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer, (ii) securities that are part of an
unsold allotment to or subscription by the Buyer, if the Buyer is a dealer,
(iii) securities issued or guaranteed by the U.S. or any instrumentality
thereof, (iv) bank deposit notes and certificates of deposit, (v) loan
participations, (vi) repurchase agreements, (vii) securities owned but subject
to a repurchase agreement and (viii) currency, interest rate and commodity
swaps.
4. For purposes of determining the aggregate amount of securities owned and/or
invested on a discretionary basis by the Buyer, the Buyer used the cost of such
securities to the Buyer and did not include any of the securities referred to in
the preceding paragraph, except (i) where the Buyer reports its securities
holdings in its financial statements on the basis of their market value, and
(ii) no current information with respect to the cost of those securities has
been published. If clause (ii) in the preceding sentence applies, the securities
may be valued at market. Further, in determining such aggregate amount, the
Buyer may have included securities owned by subsidiaries of the Buyer, but only
if such subsidiaries are consolidated with the Buyer in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Buyer's direction.
However, such securities were not included if the Buyer is a majority-owned,
consolidated subsidiary of another enterprise and the Buyer is not itself a
reporting company under the Securities Exchange Act of 1934, as amended.
5. The Buyer acknowledges that it is familiar with Rule 144A and understands
that the seller to it and other parties related to the Certificates are relying
and will continue to rely on the statements made herein because one or more
sales to the Buyer may be in reliance on Rule 144A.
6. Until the date of purchase of the Rule 144A Securities, the Buyer will notify
each of the parties to which this certification is made of any changes in the
information and conclusions herein. Until such notice is given, the Buyer's
purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
____________________________________________
Print Name of Transferee
By: ________________________________________
Name:
Title:
Date: ______________________________________
ANNEX 2 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the parties listed
in the Rule 144A Transferee Certificate to which this certification relates with
respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief Financial Officer
or Senior Vice President of the Buyer or, if the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyer's Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.
The Buyer owned $______ in securities (other than the
excluded securities referred to below) as of the end
of the Buyer's most recent fiscal year (such amount
being calculated in accordance with Rule 144A).
The Buyer is part of a Family of Investment Companies
which owned in the aggregate $ ________ in securities
(other than the excluded securities referred to
below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in
accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two or more
registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer or are part of the Buyer's Family of
Investment Companies, (ii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iii) bank deposit notes and certificates of deposit,
(iv) loan participations, (v) repurchase agreements, (vi) securities owned but
subject to a repurchase agreement and (vii) currency, interest rate and
commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that the parties listed
in the Rule 144A Transferee Certificate to which this certification relates are
relying and will continue to rely on the statements made herein because one or
more sales to the Buyer will be in reliance on Rule 144A. In addition, the Buyer
will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the undersigned will notify
the parties listed in the Rule 144A Transferee Certificate to which this
certification relates of any changes in the information and conclusions herein.
Until such notice is given, the Buyer's purchase of the Certificates will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
_________________________________________
Print Name of Transferee
By: _____________________________________
Name:
Title:
IF AN ADVISER:
_________________________________________
Print Name of Buyer
Date: ___________________________________
EXHIBIT K
FORM OF REQUEST FOR RELEASE
To: Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Deutsche Bank National Trust Company
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000-0000
In connection with the administration of the Mortgage Loans held by Deutsche
Bank National Trust Company as the Custodian on behalf of the
Certificateholders, we request the release, and acknowledge receipt, of the
(Custodial File/[specify documents]) for the Mortgage Loan described below, for
the reason indicated.
Mortgagor's Name, Address & Zip Code:
-------------------------------------
Mortgage Loan Number:
---------------------
Send Custodial File to:
-----------------------
Reason for Requesting Documents (check one)
-------------------------------------------
______ 1. Mortgage Loan Paid in Full. (The undersigned
hereby certifies that all amounts received in
connection therewith have been credited to the
applicable Collection Account as provided in the
Pooling and Servicing Agreement.)
______ 2. Mortgage Loan Repurchase Pursuant to Subsection
2.03 of the Pooling and Servicing Agreement. (The
undersigned hereby certifies that the repurchase
price has been credited to the applicable Collection
Account as provided in the Pooling and Servicing
Agreement.)
______ 3. Mortgage Loan Liquidated By _________________.
(The undersigned hereby certifies that all proceeds
of foreclosure, insurance, condemnation or other
liquidation have been finally received and credited
to the applicable Collection Account pursuant to the
Pooling and Servicing Agreement.)
______ 4. Mortgage Loan in Foreclosure.
______ 5. Other (explain).
If box 1, 2 or 3 above is checked, and if all or part of the Custodial File was
previously released to us, please release to us our previous request and receipt
on file with you, as well as any additional documents in your possession
relating to the specified Mortgage Loan.
If box 4 or 5 above is checked, upon our return of all of the above documents to
you as the Custodian, please acknowledge your receipt by signing in the space
indicated below, and returning this form if requested.
[SERVICER]
By: _____________________________________
Name:
Title:
Date:
EXHIBIT L
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include each
of the following items, which shall be available for inspection by the Sponsor
and which shall be retained by the Servicer or delivered to and retained by the
Trustee:
(a) the original Mortgage Note bearing all intervening endorsements,
endorsed "Pay to the order of _____________, without recourse" and
signed (which may be by facsimile signature) in the name of the last
endorsee by an authorized officer. To the extent that there is no
room on the face of the Mortgage Note for endorsements, the
endorsement may be contained on an allonge, unless the Trustee is
advised in writing by the applicable Originator (if required by the
applicable Purchase Agreement) or the Depositor, as applicable, that
state law does not so allow;
(b) the original of any guaranty executed in connection with the
Mortgage Note if any;
(c) the original Mortgage with evidence of recording thereon or a
certified true copy of such Mortgage submitted for recording. If, in
connection with any Mortgage Loan, the original Mortgage cannot be
delivered with evidence of recording thereon on or prior to the
Closing Date because of a delay caused by the public recording
office where such Mortgage has been delivered for recordation or
because such Mortgage has been lost or because such public recording
office retains the original recorded Mortgage, the applicable
Originator, the Depositor, title company, escrow company or
attorney, as applicable, shall deliver or cause to be delivered to
the Trustee a photocopy of such Mortgage certified by the applicable
Originator or the Depositor, title company, escrow company or
attorney, as applicable, to be a true and complete copy of such
Mortgage and shall forward to the Trustee such original recorded
Mortgage within 14 days following the applicable Originator's or the
Depositor's receipt of such Mortgage from the applicable public
recording office; or in the case of a Mortgage where a public
recording office retains the original recorded Mortgage or in the
case where a Mortgage is lost after recordation in a public
recording office, a copy of such Mortgage certified by such public
recording office to be a true and complete copy of the original
recorded Mortgage;
(d) the originals of all assumption, modification, consolidation or
extension agreements, with evidence of recording thereon or a
certified true copy of such agreement submitted for recording;
(e) the original Assignment of Mortgage for each Mortgage Loan endorsed
in blank, which may be included in a blanket assignment or
assignments (except with respect to MERS Designated Mortgage Loans);
(f) the originals of all intervening assignments of Mortgage (if any)
evidencing a complete chain of assignment from the applicable
originator (or MERS with respect to each MERS Designated Mortgage
Loan) to the last endorsee with evidence of recording thereon or a
certified true copy of such intervening assignments of Mortgage
submitted for recording, or if any such intervening assignment has
not been returned from the applicable recording office or has been
lost or if such public recording office retains the original
recorded assignments of Mortgage, the Responsible Party or the
Depositor, as applicable, shall deliver or cause to be delivered a
photocopy of such intervening assignment, certified by the
Responsible Party, originator, Depositor, title company, escrow
company or attorney, as applicable, to be a true and complete copy
of such intervening assignment and shall forward to the Trustee such
original recorded intervening assignment within 14 days following
the Responsible Party or the Depositor's receipt of such from the
applicable public recording office; or in the case of an intervening
assignment where a public recording office retains the original
recorded intervening assignment or in the case where an intervening
assignment is lost after recordation in a public recording office, a
copy of such intervening assignment certified by such public
recording office to be a true and complete copy of the original
recorded intervening assignment;
(g) the original mortgagee title insurance policy, a photocopy of the
mortgage title insurance policy, or attorney's opinion of title and
abstract of title, or, in the event such title policy is
unavailable, a copy of the related policy binder or commitment for
title from the title insurance company;
(h) the original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage (if
provided);
(i) residential loan application;
(j) Mortgage Loan closing statement;
(k) verification of employment and income, if applicable;
(l) verification of acceptable evidence of source and amount of down
payment;
(m) credit report on Mortgagor;
(n) residential appraisal report;
(o) photograph of the Mortgaged Property;
(p) survey of the Mortgaged Property;
(q) copy of each instrument necessary to complete identification of any
exception set forth in the exception schedule in the title policy,
i.e., map or plat, restrictions, easements, sewer agreements, home
association declarations, etc.;
(r) all required disclosure statements;
(s) if required in an appraisal, termite report, structural engineer's
report, water potability and septic certification; and
(t) sales contract, if applicable.
Evidence of payment of taxes and insurance, insurance claim files,
correspondence, current and historical computerized data files (which include
records of tax receipts and payment history from the date of origination), and
all other processing, underwriting and closing papers and records which are
customarily contained in a mortgage loan file and which are required to document
the Mortgage Loan or to service the Mortgage Loan.
EXHIBIT M
FORM OF SUBSEQUENT TRANSFER AGREEMENT
NATIXIS REAL ESTATE CAPITAL TRUST 2007-HE2
Pursuant to separate Mortgage Loan Purchase Agreements, First NLC Financial
Services ("First NLC"), Master Financial, Inc.("Master Financial"), Lenders
Direct Capital Corp. ("Lenders Direct"), Rose Mortgage, Inc. ("Rose Mortgage"),
Funding America, LLC ("Funding America"), NC Capital Corporation ("NC Capital"),
Maxim Mortgage Corp. ("Maxim"), Accredited Home Lenders, Inc. ("Accredited"),
First Horizon Home Loan Corporation ("First Horizon"), Platinum Capital Group
("Platinum"), Lime Financial Services, Ltd. ("Lime"), Mandalay Mortgage LLC
("Mandalay"), FlexPoint Funding Corporation ("FlexPoint") and The CIT
Group/Consumer Finance Inc ("CIT") (collectively, the "Originators") have agreed
to sell to Natixis Real Estate Capital Inc. (the "Unaffiliated Seller") certain
mortgage loans (each, a "Mortgage Loan"). These Mortgage Loans may in turn be
sold by the Unaffiliated Seller to Xxxxxx Xxxxxxx ABS Capital I Inc. (the
"Depositor") and then sold by the Depositor to the IXIS Real Estate Capital
Trust 0000-XX0 (xxx "Xxxxx Xxxx"). The Trust Fund was established pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2007 (the "Pooling and
Servicing Agreement") among Xxxxxx Xxxxxxx ABS Capital I Inc., as depositor (the
"Depositor"), Saxon Mortgage Services, Inc., as the servicer ("Saxon" and the
"Servicer"), Natixis Real Estate Capital Inc., as unaffiliated seller (the
"Unaffiliated Seller"), Deutsche Bank National Trust Company, as trustee and
custodian (in each such capacity, respectively, the "Trustee" and the
"Custodian") and Xxxxx Fargo Bank, National Association, as securities
administrator and master servicer (in each such capacity, respectively, the
"Securities Administrator" and the "Master Servicer"). The Pooling and Servicing
Agreement permits a Pre-Funding feature, allowing for the acquisition by the
Trust Fund of Subsequent Mortgage Loans during the Pre-Funding Period.
Representations and warranties with respect to the Mortgage Loans have been made
by the Originators pursuant to separate Assignment and Recognition Agreements.
Capitalized terms used herein and not defined herein have their respective
meanings as set forth in the Pooling and Servicing Agreement.
Conveyance of Subsequent Mortgage Loans.
The Unaffiliated Seller does hereby irrevocably sell, transfer, assign, set over
and otherwise convey to the Depositor, without recourse (except as otherwise
explicitly provided for herein) all of its right, title and interest in and to
the Subsequent Mortgage Loans, exclusive of the obligations of the Unaffiliated
Seller or any other Person with respect to the Subsequent Mortgage Loans but
including specifically, without limitation, the Mortgages, the Custodial Files
and all other documents, materials and properties appurtenant thereto and the
Mortgage Notes, including all interest and principal collected by the
Unaffiliated Seller on or with respect to the Subsequent Mortgage Loans after
the related Subsequent Cut-off Date, together with all of its right, title and
interest in and to the proceeds received after such Subsequent Cut-off Date of
any related insurance policies on behalf of the Depositor.
The Depositor does hereby irrevocably sell, transfer, assign, set over and
otherwise convey to the Trust Fund, without recourse (except as otherwise
explicitly provided for herein) all of its right, title and interest in and to
the Subsequent Mortgage Loans, exclusive of the obligations of the Depositor or
any other Person with respect to the Subsequent Mortgage Loans but including
specifically, without limitation, the Mortgages, the Custodial Files and all
other documents, materials and properties appurtenant thereto and the Mortgage
Notes, including all interest and principal collected by the Depositor on or
with respect to the Subsequent Mortgage Loans after the related Subsequent
Cut-off Date, together with all of its right, title and interest in and to the
proceeds received after such Subsequent Cut-off Date of any related insurance
policies on behalf of the Trust Fund.
The expenses and costs relating to the delivery of the Subsequent Mortgage Loans
specified in this Subsequent Transfer Agreement and the Pooling and Servicing
Agreement shall be borne by the Unaffiliated Seller.
The Unaffiliated Seller hereby affirms the representation and warranty set forth
in Sections 3.01(f), 3.01(h), 3.01(n), 3.01(o), 3.01(p) and 3.03 of the
Unaffiliated Seller's Agreement with respect to the Subsequent Mortgage Loans as
of the date hereof. The Unaffiliated Seller hereby delivers notice and confirms
that each of the conditions set forth in Section 2.01(c) of the Pooling and
Servicing Agreement are satisfied as of the date hereof.
Saxon hereby affirms the representations and warranties set forth in Schedule
IIIA to the Pooling and Servicing Agreement with respect to the Subsequent
Mortgage Loans as of the date hereof.
Additional terms of the sale are attached hereto as Attachment A.
To the extent permitted by applicable law, this Subsequent Transfer Agreement,
or a memorandum thereof if permitted under applicable law, is subject to
recordation in all appropriate public offices for real property records in all
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 Servicer
at the Unaffiliated Seller's expense, but only when accompanied by an opinion of
counsel to the effect that such recordation materially and beneficially affects
the interests of the Certificateholders or is necessary for the administration
or servicing of the Mortgage Loans.
This Agreement shall be construed in accordance with the laws of the State of
New York and the obligations, rights and remedies of the parties hereunder shall
be determined in accordance with such laws, without giving effect to the
principles of conflicts of laws.
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.
All terms and conditions of the Pooling and Servicing Agreement are hereby
ratified, confirmed and incorporated herein; provided, that in the event of any
conflict the provisions of this Subsequent Transfer Agreement shall control over
the conflicting provisions of the Pooling and Servicing Agreement.
[Remainder of Page Intentionally Left Blank]
NATIXIS REAL ESTATE CAPITAL INC.,
as Unaffiliated Seller
By:[____________________________________]
By:
-------------------------------------
Name:
Title:
XXXXXX XXXXXXX ABS CAPITAL I INC.,
as Depositor
By:
-------------------------------------
Name:
Title:
SAXON MORTGAGE SERVICES, INC.,
as the Servicer
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, as Securities
Administrator and Master Servicer
By:
-------------------------------------
Name:
Title:
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Trustee
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
EXHIBIT N
FORM OF CERTIFICATION
TO BE PROVIDED WITH FORM 10-K
Re: Natixis Real Estate Capital Trust 2007-HE2 (the "Trust"), Mortgage
Pass-Through Certificates, Series 2007-HE2, issued pursuant to the
Pooling and Servicing Agreement, dated as of April 1, 2007, among
Xxxxxx Xxxxxxx ABS Capital I Inc., as Depositor, Natixis Real Estate
Capital Inc., as Unaffiliated Seller, Xxxxx Fargo Bank, National
Association, as Master Servicer and Securities Administrator, Saxon
Mortgage Services, Inc., as Servicer and Deutsche Bank National
Trust Company, as Trustee
--------------------------------------------------------------------
I, [identify the certifying individual], certify that:
1. I have reviewed this annual report on Form 10-K ("Annual
Report"), and all reports on Form 10-D (collectively with this Annual
Report, the "Reports") required to be filed in respect of period covered
by this Annual Report, of the Trust;
2. Based on my knowledge, the Reports, 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 with
respect to the period covered by this Annual Report;
3. Based on my knowledge, all of the distribution, servicing and
other information required to be provided under Form 10-D for the period
covered by this Annual Report is included in the Reports;
4. Based on my knowledge and the compliance statements required in
this Annual Report under Item 1123 of Regulation AB, and except as
disclosed in the Reports, the Servicer has fulfilled their obligations
under the Pooling and Servicing Agreement in all material respects; and
5. All of the reports on assessment of compliance with servicing
criteria for asset-backed securities and their related attestation reports
on assessment of compliance with servicing criteria required to be
included in this Annual Report in accordance with Item 1122 of Regulation
AB and Exchange Act Rules 13a-18 and 15d-18 have been included as an
exhibit to this Annual Report, except as otherwise disclosed in this
Annual Report. Any material instances of non-compliance described in such
reports have been disclosed in this Annual Report.
In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties: the Trustee,
the Master Servicer, the Securities Administrator and the Servicer.
Date: ______________________________________
______________________________________
[Signature]
[Title]
EXHIBIT O
FORM OF ANNUAL CERTIFICATION TO BE
PROVIDED TO THE MASTER SERVICER
Re: Natixis Real Estate Capital Trust 2007-HE2 (the "Trust"), Mortgage
Pass-Through Certificates, Series 2007-HE2, issued pursuant to the
Pooling and Servicing Agreement, dated as of April 1, 2007, among
Xxxxxx Xxxxxxx ABS Capital I Inc., as Depositor, Natixis Real Estate
Capital Inc., as Unaffiliated Seller, Xxxxx Fargo Bank, National
Association, as Master Servicer and Securities Administrator, Saxon
Mortgage Services, Inc., as Servicer and Deutsche Bank National
Trust Company, as Trustee
--------------------------------------------------------------------
I, ________________________________, the _______________________ of [NAME
OF COMPANY], certify to [the Purchaser], [the Depositor], and the Master
Servicer[, 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 Master Servicer 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 Master Servicer;
(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 and
Subcontractor pursuant to the Agreement, have been provided to the Master
Servicer. Any material instances of noncompliance described in such
reports have been disclosed to [the Master Servicer]. Any material
instance of noncompliance with the Servicing Criteria has been disclosed
in such reports.
Date: _________________________
By: ____________________________
Name: _____________________
EXHIBIT P
FORM OF SERVICER POWER OF ATTORNEY
When Recorded Mail To:
Saxon Mortgage Services, Inc.
0000 Xxxxxxxxxx Xxxxx
Xxxx Xxxxx, Xxxxx 00000
LIMITED POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that Deutsche Bank National Trust Company, a
national banking association organized and existing under the laws of the United
States, and having its principal place of business at 0000 Xxxx Xx. Xxxxxx
Xxxxx, Xxxxx Xxx, Xxxxxxxxxx 00000, as Trustee (the "Trustee") pursuant to that
Natixis Real Estate Capital Trust 2007-HE2 Pooling and Servicing Agreement,
dated as of April 1, 2007, among Xxxxxx Xxxxxxx ABS Capital I Inc., as depositor
(the "Depositor"), Saxon Mortgage Services Inc., as servicer ("Saxon"), Xxxxx
Fargo Bank, National Association, as a Master Servicer, Securities Administrator
("Xxxxx Fargo"), Natixis Real Estate Capital Inc, as un affiliated seller
("Natixis"), and Deutsche Bank National Trust Company, as trustee (the
"Trustee"), hereby constitutes and appoints Saxon, by and through Saxon's
officers, the Trustee's true and lawful Attorney-in-fact, in the Trustee's name,
place and stead and for the Trustee's benefit, in connection with all mortgage
loans serviced by Saxon pursuant to the Agreement solely for the purpose of
performing such acts and executing such documents in the name of the Trustee
necessary and appropriate to effectuate the following enumerated transactions in
respect of any of the mortgages or deeds of trust (the "Mortgages" and the
"Deeds of Trust" respectively) and promissory notes secured thereby (the
"Mortgage Notes") for which the undersigned is acting as Trustee for various
certificateholders (whether the undersigned is named therein as mortgagee or
beneficiary or has become mortgagee by virtue of endorsement of the Mortgage
Note secured by any such Mortgage or Deed of Trust).
This Appointment shall apply only to the following enumerated transactions and
nothing herein or in the Agreement shall be construed to the contrary:
(1) The modification or re recording of a Mortgage or Deed of Trust, where
said modification or re recording is solely for the purpose of correcting
the Mortgage or Deed of Trust to conform same to the original intent of
the parties thereto or to correct title errors discovered after such title
insurance was issued; provided that (i) said modification or re recording,
in either instance, does not adversely affect the lien of the Mortgage or
Deed of Trust as insured and (ii) otherwise conforms to the provisions of
the Agreement.
(2) The subordination of the lien of a Mortgage or Deed of Trust to an
easement in favor of a public utility company of a government agency or
unit with powers of eminent domain; this section shall include, without
limitation, the execution of partial satisfactions/releases, partial
reconveyances or the execution or requests to trustees to accomplish same.
(3) The conveyance of the properties to the mortgage insurer, or the closing
of the title to the property to be acquired as real estate owned, or
conveyance of title to real estate owned.
(4) The completion of loan assumption agreements.
(5) The full satisfaction/release of a Mortgage or Deed of Trust or full
conveyance upon payment and discharge of all sums secured thereby,
including, without limitation, cancellation of the related Mortgage Note.
(6) The assignment of any Mortgage or Deed of Trust and the related Mortgage
Note, in connection with the repurchase of the mortgage loan secured and
evidenced thereby.
(7) The full assignment of a Mortgage or Deed of Trust upon payment and
discharge of all sums secured thereby in conjunction with the refinancing
thereof, including, without limitation, the assignment of the related
Mortgage Note.
(8) With respect to a Mortgage or Deed of Trust, the foreclosure, the taking
of a deed-in-lieu of foreclosure, or the completion of judicial or
non-judicial foreclosure or termination, cancellation or rescission of any
such foreclosure, including, without limitation, any and all of the
following acts:
(a) the substitution of trustee(s) serving under a Deed of Trust, in
accordance with state law and the Deed of Trust;
(b) the preparation and issuance of statements of breach or non
performance;
(c) the preparation and filing of notices of default and/or notices of
sale;
(d) the cancellation/rescission of notices of default and/or notices of
sale;
(e) the taking of deed-in-lieu of foreclosure; and
(f) the preparation and execution of such other documents and
performance of such other actions as may be necessary under the
terms of the Mortgage, Deed of Trust or state law to expeditiously
complete said transactions in paragraphs 8(a) through 8(e) above.
(9) With respect to the sale of property acquired through a foreclosure or
deed-in-lieu of foreclosure, including, without limitation, the execution
of the following documentation:
(a) listing agreements;
(b) purchase and sale agreements;
(c) grant/warranty/quit claim deeds or any other deed causing the
transfer of title of the property to a party contracted to purchase
same;
(d) escrow instructions; and
(e) any and all documents necessary to effect the transfer of property.
(10) The modification or amendment of escrow agreements established for repairs
to the mortgaged property or reserves for replacement of personal
property.
(11) Actions to preserve or enforce the lien created by the Mortgage or Deed of
Trust, including but not limited to assertion of claims under title
insurance policies and through judicial or administrative action.
The undersigned gives said Attorney in fact full power and authority
to execute such instruments and to do and perform all and every act and thing
necessary and proper to carry into effect the power or powers granted by or
under this Limited Power of Attorney as fully as the undersigned might or could
do, and hereby does ratify and confirm to all that said Attorney in fact shall
be effective as of April 30, 2007.
This appointment is to be construed and interpreted as a limited
power of attorney. The enumeration of specific items, rights, acts or powers
herein is not intended to, nor does it give rise to, and it is not to be
construed as a general power of attorney.
Nothing contained herein shall (i) limit in any manner any
indemnification provided by Saxon to the Trustee under the Agreement, or (ii) be
construed to xxxxx Xxxxx the power to initiate or defend any suit, litigation or
proceeding in the name of the Trustee except as specifically provided for
herein. If Saxon receives any notice of suit, litigation or proceeding in the
name of the Trustee, then Saxon shall promptly forward a copy of same to the
Trustee.
This limited power of attorney is not intended to extend the powers
granted to Saxon under the Agreement or to allow Saxon to take any action with
respect to Mortgages, Deeds of Trust or Mortgage Notes not authorized by the
Agreement.
Saxon hereby agrees to indemnify and hold the Trustee and its
directors, officers, employees and agents harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever incurred by
reason or result of or in connection with the exercise by Saxon of the powers
granted to it hereunder. The foregoing indemnity shall survive the termination
of this Limited Power of Attorney and the Agreement or the earlier resignation
or removal of the Trustee under the Agreement.
This Limited Power of Attorney is entered into and shall be governed
by the laws of the State of New York, without regard to conflicts of law
principles of such state.
Third parties without actual notice may rely upon the exercise of
the power granted under this Limited Power of Attorney; and may be satisfied
that this Limited Power of Attorney shall continue in full force and effect and
has not been revoked unless an instrument of revocation has been made in writing
by the undersigned.
IN WITNESS WHEREOF, Deutsche Bank National Trust Company, as
Trustee has caused its corporate seal to be hereto affixed and these presents
to be signed and acknowledged in its name and behalf by a duly elected and
authorized signatory this ___________ day of ____________.
Deutsche Bank National Trust Company,
as Trustee
By: _____________________________________
Name:
Title:
Acknowledged and Agreed
Saxon Mortgage Services, Inc.
By: ________________________
Name:
Title:
STATE OF CALIFORNIA
COUNTY OF ____________
On ________________, _____, before me, the undersigned, a Notary
Public in and for said state, personally appeared
________________________________ of Deutsche Bank National Trust Company, as
Trustee for Natixis Real Estate Capital Trust 2007-HE2, personally known to me
to be the person whose name is subscribed to the within instrument and
acknowledged to me that he/she executed that same in his/her authorized
capacity, and that by his/her signature on the instrument the entity upon behalf
of which the person acted and executed the instrument.
WITNESS my hand and official seal.
(SEAL)
_____________________________________
Notary Public, State of California
EXHIBIT Q
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by [the Trustee], [the Securities
Administrator], [Master Servicer], [the Servicer], [each Subservicer] and [each
Subcontractor] shall address, at a minimum, the criteria identified as below as
"Applicable Servicing Criteria":
------------------------------------------------------------------------------------------------------------------------------------
SERVICING CRITERIA APPLICABLE SERVICING CRITERIA
------------------------------------------------------------------------------------------------------------------------------------
Reference Criteria
------------------------------------------------------------------------------------------------------------------------------------
General Servicing Considerations
------------------------------------------------------------------------------------------------------------------------------------
Policies and procedures are instituted to monitor any performance or
other triggers and events of default in accordance with the transaction Securities
1122(d)(1)(i) agreements. Administrator/Servicer
If any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party's
1122(d)(1)(ii) performance and compliance with such servicing activities. Servicer
Any requirements in the transaction agreements to maintain a back-up
1122(d)(1)(iii) servicer for the mortgage loans are maintained. N/A
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 Servicer
1122(d)(1)(iv) the terms of the transaction agreements.
------------------------------------------------------------------------------------------------------------------------------------
Cash Collection and Administration
------------------------------------------------------------------------------------------------------------------------------------
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 Servicer/Master Servicer
1122(d)(2)(i) in the transaction agreements.
Disbursements made via wire transfer on behalf of an obligor or to an Servicer/Securities
1122(d)(2)(ii) investor are made only by authorized personnel. Administrator
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 Servicer
1122(d)(2)(iii) agreements.
The related accounts for the transaction, such as cash reserve accounts
or accounts established as a form of overcollateralization, are Servicer/Securities
separately maintained (e.g., with respect to commingling of cash) as set Administrator/Master Servicer
1122(d)(2)(iv) forth in the transaction agreements.
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 Servicer/Securities
to a foreign financial institution means a foreign financial institution Administrator/Master
that meets the requirements of Rule 13k-1(b)(1) of the Securities Servicer(1)
1122(d)(2)(v) Exchange Act.
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent unauthorized access. Servicer
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 Servicer/Master Servicer
calendar days of their original identification, or such other number of
1122(d)(2)(vii) days specified in the transaction agreements.
------------------------------------------------------------------------------------------------------------------------------------
Investor Remittances and Reporting
------------------------------------------------------------------------------------------------------------------------------------
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 Servicer/Securities
with the Commission as required by its rules and regulations; and (D) Administrator/Master Servicer
agree with investors' or the trustee's records as to the total unpaid
1122(d)(3)(i) principal balance and number of mortgage loans serviced by the Servicer.
Amounts due to investors are allocated and remitted in accordance with
timeframes, distribution priority and other terms set forth in the Servicer/Securities
1122(d)(3)(ii) transaction agreements. Administrator/Master Servicer
Disbursements made to an investor are posted within two business days to Servicer/Securities
the Servicer's investor records, or such other number of days specified Administrator
1122(d)(3)(iii) in the transaction agreements.
Amounts remitted to investors per the investor reports agree with Servicer/Securities
1122(d)(3)(iv) cancelled checks, or other form of payment, or custodial bank statements. Administrator/Master Servicer
------------------------------------------------------------------------------------------------------------------------------------
Pool Asset Administration
------------------------------------------------------------------------------------------------------------------------------------
Collateral or security on mortgage loans is maintained as required by
1122(d)(4)(i) the transaction agreements or related mortgage loan documents. Trustee/Servicer
Mortgage loan and related documents are safeguarded as required by the Trustee/Servicer
1122(d)(4)(ii) transaction agreements
Any additions, removals or substitutions to the asset pool are made,
reviewed and approved in accordance with any conditions or requirements Securities
1122(d)(4)(iii) in the transaction agreements. Administrator/Servicer
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 Servicer
1122(d)(4)(iv) accordance with the related mortgage loan documents.
The Servicer's records regarding the mortgage loans agree with the
1122(d)(4)(v) Servicer's records with respect to an obligor's unpaid principal balance. Servicer
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 Servicer
1122(d)(4)(vi) agreements and related pool asset documents.
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 Servicer
1122(d)(4)(vii) transaction agreements.
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 Servicer
plans in cases where delinquency is deemed temporary (e.g., illness or
1122(d)(4)(viii) unemployment).
Adjustments to interest rates or rates of return for mortgage loans with
1122(d)(4)(ix) variable rates are computed based on the related mortgage loan documents. Servicer
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 Servicer
mortgage loans, or such other number of days specified in the transaction
1122(d)(4)(x) agreements.
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 Servicer
1122(d)(4)(xi) transaction agreements.
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 Servicer
1122(d)(4)(xii) omission.
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 Servicer
1122(d)(4)(xiii) number of days specified in the transaction agreements.
Delinquencies, charge-offs and uncollectible accounts are recognized and
1122(d)(4)(xiv) recorded in accordance with the transaction agreements. Servicer
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 Servicer
1122(d)(4)(xv) the transaction agreements.
------------------------------------------------------------------------------------------------------------------------------------
-----------------
(1) This will only be provided by the Master Servicer and Securities
Administrator if it is deemed that such account maintained by the Master
Servicer or Securities Administrator, as applicable, is a custodial account for
purposes of these servicing criteria and is further subject to clarification
from the SEC.
EXHIBIT R
Additional Form 10-D Disclosure
---------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-D DISCLOSURE
---------------------------------------------------------------------------------------------------------
Item on Form 10-D Party Responsible
---------------------------------------------------------------------------------------------------------
Item 1: Distribution and Pool Performance
Information
---------------------------------------------------------------------------------------------------------
Information included in the Monthly Statement Servicer/
Master Servicer/
Securities Administrator
---------------------------------------------------------------------------------------------------------
Any information required by Item 1121 of Regulation Depositor
AB which is NOT included on the Monthly Statement
---------------------------------------------------------------------------------------------------------
Item 2: Legal Proceedings
Any legal proceeding pending against the following
entities or their respective property, that is
material to Certificateholders, including any
proceedings known to be contemplated by
governmental authorities:
---------------------------------------------------------------------------------------------------------
o Issuing Entity Master Servicer/Securities Administrator/Servicer
---------------------------------------------------------------------------------------------------------
o Sponsor Sponsor (if a party to the Pooling and Servicing
Agreement) or Depositor
---------------------------------------------------------------------------------------------------------
o Depositor Depositor
---------------------------------------------------------------------------------------------------------
o Trustee Trustee
---------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
---------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
---------------------------------------------------------------------------------------------------------
o Any Responsible Party Responsible Parties
---------------------------------------------------------------------------------------------------------
o Any Item 1110(b) of Regulation AB Originator Depositor
(other than a Responsible Party)
---------------------------------------------------------------------------------------------------------
o Any Item 1108(a)(2) of Regulation Servicer (other Servicer
than the Master Servicer or Securities
Administrator)
---------------------------------------------------------------------------------------------------------
o Any other party contemplated by Item 1100(d)(1) Depositor
of Regulation AB
---------------------------------------------------------------------------------------------------------
Item 3: Sale of Securities and Use of Proceeds Depositor
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.
---------------------------------------------------------------------------------------------------------
Item 4: Defaults Upon Senior Securities Securities Administrator
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)
---------------------------------------------------------------------------------------------------------
Item 5: Submission of Matters to a Vote of Depositor/Securities Administrator
Security Holders
Information from Item 4 of Part II of Form 10-Q
---------------------------------------------------------------------------------------------------------
Item 6: Significant Obligors of Pool Assets N/A
Item 1112(b) of Regulation AB - Significant Obligor
Financial Information*
---------------------------------------------------------------------------------------------------------
*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.
---------------------------------------------------------------------------------------------------------
Item 7: Significant Enhancement Provider
Information
Item 1114(b)(2) of Regulation AB - Credit
Enhancement Provider Financial Information*
---------------------------------------------------------------------------------------------------------
o Determining applicable disclosure threshold Depositor
---------------------------------------------------------------------------------------------------------
o Requesting required financial information Depositor
(including any required accountants' consent to the
use thereof) or effecting incorporation by reference
---------------------------------------------------------------------------------------------------------
Item 1115(b) of Regulation AB - Derivative
Counterparty Financial Information*
---------------------------------------------------------------------------------------------------------
o Determining current maximum probable exposure Depositor
---------------------------------------------------------------------------------------------------------
o Determining current significance percentage Depositor
---------------------------------------------------------------------------------------------------------
o Requesting required financial information Depositor
(including any required accountants' consent to the
use thereof) or effecting incorporation by reference
---------------------------------------------------------------------------------------------------------
*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.
---------------------------------------------------------------------------------------------------------
Item 8: Other Information Any party to this Agreement responsible for the
applicable Form 8-K Disclosure item
Disclose any information required to be reported on
Form 8-K during the period covered by the Form 10-D
but not reported
---------------------------------------------------------------------------------------------------------
Item 9: Exhibits
---------------------------------------------------------------------------------------------------------
Monthly Statement to Certificateholders Securities Administrator
---------------------------------------------------------------------------------------------------------
Exhibits required by Item 601 of Regulation S-K, Depositor
such as material agreements
---------------------------------------------------------------------------------------------------------
EXHIBIT S
Additional Form 10-K Disclosure
---------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
---------------------------------------------------------------------------------------------------------
Item on Form 10-K Party Responsible
---------------------------------------------------------------------------------------------------------
Item 9B: Other Information Any party to this Agreement responsible for
Disclose any information required to be reported on disclosure items on Form 8-K
Form 8-K during the fourth quarter covered by the
Form 10-K but not reported
---------------------------------------------------------------------------------------------------------
Item 15: Exhibits, Financial Statement Schedules Securities Administrator
Depositor
---------------------------------------------------------------------------------------------------------
Item 1115(b) of Regulation AB: Derivative
Counterparty Financial Information*
---------------------------------------------------------------------------------------------------------
o Determining current maximum probable exposure Depositor
---------------------------------------------------------------------------------------------------------
o Determining current significance percentage Depositor
---------------------------------------------------------------------------------------------------------
o Requesting required financial information Depositor
(including any required accountants' consent to the
use thereof) or effecting incorporation by reference
---------------------------------------------------------------------------------------------------------
*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.
---------------------------------------------------------------------------------------------------------
Item 1117 of Regulation AB: Legal Proceedings
Any legal proceeding pending against the following
entities or their respective property, that is
material to Certificateholders, including any
proceedings known to be contemplated by
governmental authorities:
---------------------------------------------------------------------------------------------------------
o Issuing Entity Master Servicer/Securities Administrator/Servicer
and Depositor
---------------------------------------------------------------------------------------------------------
o Sponsor Sponsor (if a party to the Pooling and Servicing
Agreement) or Depositor
---------------------------------------------------------------------------------------------------------
o Depositor Depositor
---------------------------------------------------------------------------------------------------------
o Trustee Trustee
---------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
---------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
---------------------------------------------------------------------------------------------------------
o Any Responsible Party Responsible Party
---------------------------------------------------------------------------------------------------------
o Any Item 1110(b) of Regulation AB Originator Depositor
(other than a Responsible Party)
---------------------------------------------------------------------------------------------------------
o Any Item 1108(a)(2) of Regulation AB Servicer Servicer
(other than the Master Servicer or Securities
Administrator)
---------------------------------------------------------------------------------------------------------
? Any other party contemplated by Item 1100(d)(1) Depositor
of Regulation AB
---------------------------------------------------------------------------------------------------------
Item 1119 of Regulation AB: Affiliations and
Relationships
---------------------------------------------------------------------------------------------------------
Whether (a) the Sponsor, Depositor or Issuing Depositor as to (a)
Entity is an affiliate of the following parties, Sponsor as to (a) (if a party to this Agreement)
and (b) to the extent known and material, any of
the following parties are affiliated with one
another:
---------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
---------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
---------------------------------------------------------------------------------------------------------
o Trustee Trustee
---------------------------------------------------------------------------------------------------------
o Any other Item 1108(a)(3) of Regulation AB Servicer
servicer
---------------------------------------------------------------------------------------------------------
o Any Item 1115 of Regulation AB Derivate Depositor/Sponsor (if a party to this Agreement)
Counterparty Provider
---------------------------------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor (if a party to this Agreement)
---------------------------------------------------------------------------------------------------------
Whether there are any "outside the ordinary course Depositor as to (a)
business arrangements" other than would be obtained Sponsor as to (a) (if a party to this Agreement)
in an arm's length transaction between (a) the
Sponsor, Depositor or Issuing Entity on the one
hand, and (b) any of the following parties (or
their affiliates) on the other hand, that exist
currently or within the past two years and that are
material to a Certificateholder's understanding of
the Certificates:
---------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
---------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
---------------------------------------------------------------------------------------------------------
o Trustee Depositor
---------------------------------------------------------------------------------------------------------
o Any other Item 1108(a)(3) of Regulation AB Servicer
servicer
---------------------------------------------------------------------------------------------------------
o Any Responsible Party Responsible Party
---------------------------------------------------------------------------------------------------------
o Any Item 1110 of Regulation AB Originator (other Depositor/Sponsor (if a party to this Agreement)
than a Responsible Party)
---------------------------------------------------------------------------------------------------------
o Any Item 1115 of Regulation AB Derivate Depositor/Sponsor (if a party to this Agreement)
Counterparty Provider
---------------------------------------------------------------------------------------------------------
o Any other Item 1101(d)(1) of Regulation AB Depositor/Sponsor (if a party to this Agreement)
material party
---------------------------------------------------------------------------------------------------------
Whether there are any specific relationships Depositor as to (a)
involving the transaction or the pool assets Sponsor as to (a) (if a party to this Agreement)
between (a) the Sponsor, Depositor or Issuing
Entity on the one hand, and (b) any of the
following parties (or their affiliates) on the
other hand, that exist currently or within the past
two years and that are material:
---------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
---------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
---------------------------------------------------------------------------------------------------------
o Trustee Depositor
---------------------------------------------------------------------------------------------------------
o Any other Item 1108(a)(3) of Regulation AB Servicer
servicer
---------------------------------------------------------------------------------------------------------
o Any Responsible Party Responsible Party
---------------------------------------------------------------------------------------------------------
o Any Item 1110 of Regulation AB Originator (other Depositor/Sponsor (if a party to this Agreement)
than a Responsible Party)
---------------------------------------------------------------------------------------------------------
o Any Item 1115 of Regulation AB Derivate Depositor/Sponsor (if a party to this Agreement)
Counterparty Provider
---------------------------------------------------------------------------------------------------------
o Any other Item 1101(d)(1) of Regulation AB Depositor/Sponsor (if a party to this Agreement)
material party
---------------------------------------------------------------------------------------------------------
EXHIBIT T
Form 8-K Disclosure Information
---------------------------------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
---------------------------------------------------------------------------------------------------------
Item on Form 8-K Party Responsible
---------------------------------------------------------------------------------------------------------
Item 1.01 - Entry into a Material Definitive The party to this Agreement entering into such
Agreement 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.
---------------------------------------------------------------------------------------------------------
Item 1.02 - Termination of a Material Definitive The party to this Agreement requesting termination
Agreement of a material definitive agreement
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.
---------------------------------------------------------------------------------------------------------
Item 1.03 - Bankruptcy or Receivership Depositor
Disclosure is required regarding the bankruptcy or
receivership, with respect to any of the following:
---------------------------------------------------------------------------------------------------------
o Issuing Entity Depositor
---------------------------------------------------------------------------------------------------------
o Sponsor Depositor/Sponsor (if a party to this Agreement)
---------------------------------------------------------------------------------------------------------
o Depositor Depositor
---------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
---------------------------------------------------------------------------------------------------------
o Any affiliated Servicer The Servicer
---------------------------------------------------------------------------------------------------------
o Other Servicer servicing 20% or more of the pool The Servicer
assets at the time of the report
---------------------------------------------------------------------------------------------------------
o Other material servicers Servicer
---------------------------------------------------------------------------------------------------------
o Trustee Trustee
---------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
---------------------------------------------------------------------------------------------------------
o Derivative Counterparty Depositor/Sponsor (if a party to this Agreement)
---------------------------------------------------------------------------------------------------------
Item 2.04 - Triggering Events that Accelerate or Master Servicer/Securities Administrator/Depositor
Increase a Direct Financial Obligation or an
Obligation under an 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 the certificateholders.
---------------------------------------------------------------------------------------------------------
Item 3.03 - Material Modification to Rights of Securities Administrator/Depositor
Security Holders
Disclosure is required of any material modification
to documents defining the rights of
Certificateholders, including the Pooling and
Servicing Agreement.
---------------------------------------------------------------------------------------------------------
Item 5.03 - Amendments of Articles of Incorporation Depositor
or Bylaws; Change of Fiscal Year
Disclosure is required of any amendment "to the
governing documents of the issuing entity".
---------------------------------------------------------------------------------------------------------
Item 6.01 - ABS Informational and Computational Depositor
Material
---------------------------------------------------------------------------------------------------------
Item 6.02 - Change of Servicer or Securities Master Servicer/Securities Administrator/Depositor/
Administrator applicable successor Servicer/applicable successor
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 or trustee.
---------------------------------------------------------------------------------------------------------
Regulation AB disclosure about any new servicer or applicable successor Servicer/applicable successor
master servicer is also required. Master Servicer/Depositor
---------------------------------------------------------------------------------------------------------
Regulation AB disclosure about any new Trustee is applicable successor Trustee
also required.
---------------------------------------------------------------------------------------------------------
Item 6.03 - Change in Credit Enhancement or Depositor/Securities Administrator
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.
---------------------------------------------------------------------------------------------------------
Regulation AB disclosure about any new enhancement Depositor
provider is also required.
---------------------------------------------------------------------------------------------------------
Item 6.04 - Failure to Make a Required Distribution Securities Administrator
---------------------------------------------------------------------------------------------------------
Item 6.05 - Securities Act Updating Disclosure Depositor
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 Regulation AB disclosure about the
actual asset pool.
---------------------------------------------------------------------------------------------------------
If there are any new servicers or originators Depositor
required to be disclosed under Regulation AB as a
result of the foregoing, provide the information
called for in Items 1108 and 1110 respectively.
---------------------------------------------------------------------------------------------------------
Item 7.01 - Reg FD Disclosure All parties to this Agreement (excluding the
Trustee)
---------------------------------------------------------------------------------------------------------
Item 8.01 - Other Events Depositor
Any event, with respect to which information is not
otherwise called for in Form 8 -K, that the
registrant deems of importance to
certificateholders.
---------------------------------------------------------------------------------------------------------
Item 9.01 - Financial Statements and Exhibits The party to this Agreement responsible for
reporting/disclosing the financial statement or
exhibit.
---------------------------------------------------------------------------------------------------------
EXHIBIT U
FORM OF ADDITIONAL DISCLOSURE NOTIFICATION
**SEND VIA EMAIL TO xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx
AND VIA OVERNIGHT MAIL TO THE ADDRESS IMMEDIATELY BELOW
Xxxxx Fargo Bank, N.A. as Securities Administrator
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
E-mail: xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx
Xxxxxx Xxxxxxx ABS Capital Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Corporate Trust Services - Natixis 2007-HE2 - SEC REPORT PROCESSING
**Additional Form [10 D] [10 K] [8 K] Disclosure**Required
----------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 8.12 of the Pooling and Servicing Agreement (the
"Agreement"), dated as of April 1, 2007, among Xxxxxx Xxxxxxx ABS Capital I
Inc., as depositor, Xxxxx Fargo Bank, National Association, as master servicer
and securities administrator, Saxon Mortgage Services, Inc., as servicer,
Natixis Real Estate Capital Inc, as unaffiliated seller, and Deutsche Bank
National Trust Company, as trustee, the undersigned, as
[_________________________] hereby notifies you that certain events have come to
our attention that we are required to report to you for disclosure on Form
[10-D] [10-K] [8-K].
Description of additional Form [10-D] [10-K] [8-K] Disclosure:
List of any attachments hereto to be included in the Additional Form [10-D]
[10-K] [8-K] Disclosure:
Each of the attachments hereto is being transmitted to the Trustee in an
XXXXX-compatible format.
Any inquiries related to this notification should be directed to
[_________________] phone number [___________________]; email address
[______________________].
[NAME OF PARTY],
As [Role]
By:
Name:
EXHIBIT V
FORM OF SERVICER REPORT
------------------------------------------------------------------------------------------------------------------
Standard Loan Level File Layout - Master
Servicing
------------------------------------------------------------------------------------------------------------------
Exhibit 1: Layout
--------------------------------------------------------------------------------------------------------------------
Column Name Description Decimal Format Comment Max
Size
--------------------------------------------------------------------------------------------------------------------
Each file requires the following fields:
--------------------------------------------------------------------------------------------------------------------
SER_INVESTOR_NBR A value assigned by the Servicer to define Text up to 20 digits 20
a group of loans.
--------------------------------------------------------------------------------------------------------------------
LOAN_NBR A unique identifier assigned to each loan Text up to 10 digits 10
by the investor.
--------------------------------------------------------------------------------------------------------------------
SERVICER_LOAN_NBR A unique number assigned to a loan by the Text up to 10 digits 10
Servicer. This may be different than the
LOAN_NBR.
--------------------------------------------------------------------------------------------------------------------
SCHED_PAY_AMT Scheduled monthly principal and scheduled 2 No commas(,) or 11
interest payment that a borrower is dollar signs ($)
expected to pay, P&I constant.
--------------------------------------------------------------------------------------------------------------------
NOTE_INT_RATE The loan interest rate as reported by the 4 Max length of 6 6
Servicer.
--------------------------------------------------------------------------------------------------------------------
NET_INT_RATE The loan gross interest rate less the 4 Max length of 6 6
service fee rate as reported by the
Servicer.
--------------------------------------------------------------------------------------------------------------------
SERV_FEE_RATE The servicer's fee rate for a loan as 4 Max length of 6 6
reported by the Servicer.
--------------------------------------------------------------------------------------------------------------------
SERV_FEE_AMT The servicer's fee amount for a loan as 2 No commas(,) or 11
reported by the Servicer. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
NEW_PAY_AMT The new loan payment amount as reported by 2 No commas(,) or 11
the Servicer. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
NEW_LOAN_RATE The new loan rate as reported by the 4 Max length of 6 6
Servicer.
--------------------------------------------------------------------------------------------------------------------
ARM_INDEX_RATE The index the Servicer is using to 4 Max length of 6 6
calculate a forecasted rate.
--------------------------------------------------------------------------------------------------------------------
ACTL_BEG_PRIN_BAL The borrower's actual principal balance at 2 No commas(,) or 11
the beginning of the processing cycle. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
ACTL_END_PRIN_BAL The borrower's actual principal balance at 2 No commas(,) or 11
the end of the processing cycle. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
BORR_NEXT_PAY_DUE_DATE The date at the end of processing cycle MM/DD/YYYY 10
that the borrower's next payment is due to
the Servicer, as reported by Servicer.
--------------------------------------------------------------------------------------------------------------------
SERV_CURT_AMT_1 The first curtailment amount to be applied. 2 No commas(,) or 11
dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
SERV_CURT_DATE_1 The curtailment date associated with the MM/DD/YYYY 10
first curtailment amount.
--------------------------------------------------------------------------------------------------------------------
CURT_ADJ_AMT_1 The curtailment interest on the first 2 No commas(,) or 11
curtailment amount, if applicable. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
SERV_CURT_AMT_2 The second curtailment amount to be applied. 2 No commas(,) or 11
dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
SERV_CURT_DATE_2 The curtailment date associated with the MM/DD/YYYY 10
second curtailment amount.
--------------------------------------------------------------------------------------------------------------------
CURT_ADJ_AMT_2 The curtailment interest on the second 2 No commas(,) or 11
curtailment amount, if applicable. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
SERV_CURT_AMT_3 The third curtailment amount to be applied. 2 No commas(,) or 11
dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
SERV_CURT_DATE_3 The curtailment date associated with the MM/DD/YYYY 10
third curtailment amount.
--------------------------------------------------------------------------------------------------------------------
CURT_ADJ_AMT_3 The curtailment interest on the third 2 No commas(,) or 11
curtailment amount, if applicable. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
PIF_AMT The loan "paid in full" amount as reported 2 No commas(,) or 11
by the Servicer. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
PIF_DATE The paid in full date as reported by the MM/DD/YYYY 10
Servicer.
--------------------------------------------------------------------------------------------------------------------
ACTION_CODE The standard FNMA numeric code used to Action Code Key: 2
65=Repurchase,70=REO indicate the 15=Bankruptcy,
default/delinquent status of a particular loan. 30=Foreclosure, ,
60=PIF,
63=Substitution,
--------------------------------------------------------------------------------------------------------------------
INT_ADJ_AMT The amount of the interest adjustment as 2 No commas(,) or 11
reported by the Servicer. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
SOLDIER_SAILOR_ADJ_AMT The Soldier and Sailor Adjustment amount, 2 No commas(,) or 11
if applicable. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
NON_ADV_LOAN_AMT The Non Recoverable Loan Amount, if 2 No commas(,) or 11
applicable. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
LOAN_LOSS_AMT The amount the Servicer is passing as a 2 No commas(,) or 11
loss, if applicable. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
Plus the following applicable fields:
--------------------------------------------------------------------------------------------------------------------
SCHED_BEG_PRIN_BAL The scheduled outstanding principal amount 2 No commas(,) or 11
due at the beginning of the cycle date to dollar signs ($)
be passed through to investors.
--------------------------------------------------------------------------------------------------------------------
SCHED_END_PRIN_BAL The scheduled principal balance due to 2 No commas(,) or 11
investors at the end of a processing cycle. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
SCHED_PRIN_AMT The scheduled principal amount as reported 2 No commas(,) or 11
by the Servicer for the current cycle -- dollar signs ($)
only applicable for Scheduled/Scheduled
Loans.
--------------------------------------------------------------------------------------------------------------------
SCHED_NET_INT The scheduled gross interest amount less 2 No commas(,) or 11
the service fee amount for the current dollar signs ($)
cycle as reported by the Servicer -- only
applicable for Scheduled/Scheduled Loans.
--------------------------------------------------------------------------------------------------------------------
ACTL_PRIN_AMT The actual principal amount collected by 2 No commas(,) or 11
the Servicer for the current reporting dollar signs ($)
cycle -- only applicable for Actual/Actual
Loans.
--------------------------------------------------------------------------------------------------------------------
ACTL_NET_INT The actual gross interest amount less the 2 No commas(,) or 11
service fee amount for the current dollar signs ($)
reporting cycle as reported by the Servicer
-- only applicable for Actual/Actual Loans.
--------------------------------------------------------------------------------------------------------------------
PREPAY_PENALTY_AMT The penalty amount received when a borrower 2 No commas(,) or 11
prepays on his loan as reported by the dollar signs ($)
Servicer.
--------------------------------------------------------------------------------------------------------------------
PREPAY_PENALTY_WAIVED The prepayment penalty amount for the loan 2 No commas(,) or 11
waived by the servicer. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
MOD_DATE The Effective Payment Date of the MM/DD/YYYY 10
Modification for the loan.
--------------------------------------------------------------------------------------------------------------------
MOD_TYPE The Modification Type. Varchar - value can 30
be alpha or numeric
--------------------------------------------------------------------------------------------------------------------
DELINQ_P&I_ADVANCE_AMT The current outstanding principal and 2 No commas(,) or 11
interest advances made by Servicer. dollar signs ($)
--------------------------------------------------------------------------------------------------------------------
Flag to indicate if the repurchase of a Y=Breach 1
BREACH_FLAG loan is due to a breach of Representations N=NO Breach
and Warranties Let blank if N/A
--------------------------------------------------------------------------------------------------------------------
Exhibit 2: Monthly Summary Report by Single Investor
MONTHLY SUMMARY REPORT
For Month Ended: /mm/dd/yyyy Servicer Name _____________________________
Prepared by: ___________________ Investor Nbr ______________________________
----------------------------------------------------------------------------------------------------
Section 1. Remittances and Ending Balances - Required Data
----------------------------------------------------------------------------------------------------
Beginning Ending Total Monthly Total Ending Unpaid Total Monthly Principal
Loan Count Loan Count Remittance Amount Principal Balance Balance
----------------------------------------------------------------------------------------------------
0 0 $0.00 $0.00 $0.00
Principal Calculation
---------------------
1 Monthly Principal Due + $0.00
-----
2. Current Curtailments + $0.00
-----
3. Liquidations + $0.00
-----
4. Other (attach explanation) + $0.00
-----
5. Principal Due $0.00
-----
6. Interest (reported "gross") + $0.00
-----
7. Interest Adjustments on Curtailments + $0.00
-----
8. Servicing Fees - $0.00
-----
9. Other Interest (attach explanation) + $0.00
-----
10. Interest Due (need to subtract ser fee) $0.00
=====
Remittance Calculation
----------------------
11. Total Principal and Interest Due (lines 5+10) + $0.00
-----
12. Reimbursement of Non-Recoverable Advances - $0.00
-----
13. Total Realized gains + $0.00
-----
14. Total Realized Losses _ $0.00
-----
15. Total Prepayment Penalties + $0.00
-----
16. Total Non-Supported Compensating Interest _ $0.00
-----
17. Other (attach explanation) $0.00
-----
18. Net Funds Due on or before Remittance Date $ $0.00
=====
---------------------------------------------------------------------------------------------------------------------------------
Section 2. Delinquency Report - Optional Data for Loan Accounting
---------------------------------------------------------------------------------------------------------------------------------
Installments Delinquent
---------------------------------------------------------------------------------------------------------------------------------
Total No. Total No. of 30- Days 60- Days 90 or more In Foreclosure Real Estate Total Dollar
of Loans Delinquencies Days (Optional) Owned Amount of
(Optional) Delinquencies
---------------------------------------------------------------------------------------------------------------------------------
0 0 0 0 0 0 0 $0.00
---------------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Section 3. REG AB Summary Reporting - REPORTING ALL APPLICABLE FIELDS
--------------------------------------------------------------------------------
REG XX XXXXXX LOAN COUNT BALANCE
PREPAYMENT PENALTY AMT 0 $0.00
PREPAYMENT PENALTY AMT WAIVED 0 $0.00
DELINQUENCY P&I AMOUNT 0 $0.00
Calculation of Realized Loss/Gain Form 332 - Instruction Sheet
NOTE: Do not net or combine items. Show all expenses individually and all
credits as separate line items. Claim packages are due on the remittance
report date. Late submissions may result in claims not being passed until
the following month. The Servicer is responsible to remit all funds
pending loss approval and /or resolution of any disputed items.
(b)
(c) The numbers on the 332 form correspond with the numbers listed
below.
Liquidation and Acquisition Expenses:
-------------------------------------
1. The Actual Unpaid Principal Balance of the Mortgage Loan. For
documentation, an Amortization Schedule from date of default through
liquidation breaking out the net interest and servicing fees
advanced is required.
2. The Total Interest Due less the aggregate amount of servicing fee
that would have been earned if all delinquent payments had been made
as agreed. For documentation, an Amortization Schedule from date of
default through liquidation breaking out the net interest and
servicing fees advanced is required.
3. Accrued Servicing Fees based upon the Scheduled Principal Balance of
the Mortgage Loan as calculated on a monthly basis. For
documentation, an Amortization Schedule from date of default through
liquidation breaking out the net interest and servicing fees
advanced is required.
4-12. Complete as applicable. Required documentation:
* For taxes and insurance advances - see page 2 of 332 form -
breakdown required showing period
of coverage, base tax, interest, penalty. Advances prior to default
require evidence of servicer efforts to recover advances.
* For escrow advances - complete payment history
(to calculate advances from last positive escrow balance forward)
* Other expenses - copies of corporate advance history showing all
payments
* REO repairs > $1500 require explanation
* REO repairs > $3000 require evidence of at least 2 bids.
* Short Sale or Charge Off require P&L supporting the decision and
WFB's approved Officer Certificate
* Unusual or extraordinary items may require further documentation.
13. The total of lines 1 through 12.
(d) Credits:
14-21. Complete as applicable. Required documentation:
* Copy of the HUD 1 from the REO sale. If a 3rd Party Sale, bid
instructions and Escrow Agent / Attorney
Letter of Proceeds Breakdown.
* Copy of EOB for any MI or gov't guarantee
* All other credits need to be clearly defined on the 332 form
22. The total of lines 14 through 21.
Please Note: For HUD/VA loans, use line (18a) for Part A/Initial
proceeds and line (18b) for Part B/Supplemental proceeds.
Total Realized Loss (or Amount of Any Gain)
-------------------------------------------
23. The total derived from subtracting line 22 from 13. If the amount
represents a realized gain, show the amount in parenthesis ( ).
Calculation of Realized Loss/Gain Form 332
Prepared by: __________________ Date: _______________
Phone: ______________________ Email Address: _____________________
--------------------- ------------------------ ----------------------
Servicer Loan No. Servicer Name Servicer Address
--------------------- ------------------------ ----------------------
XXXXX FARGO BANK, N.A. Loan No. _____________________________
Borrower's Name: _________________________________________________________
Property Address: ________________________________________________________
Liquidation Type: REO Sale 3rd Party Sale Short Sale Charge Off
Was this loan granted a Bankruptcy deficiency or cramdown Yes No
If "Yes", provide deficiency or cramdown amount _________________________
Liquidation and Acquisition Expenses:
(1) Actual Unpaid Principal Balance of Mortgage Loan $ ______________ (1)
(2) Interest accrued at Net Rate ________________ (2)
(3) Accrued Servicing Fees ________________ (3)
(4) Attorney's Fees ________________ (4)
(5) Taxes (see page 2) ________________ (5)
(6) Property Maintenance ________________ (6)
(7) MI/Hazard Insurance Premiums (see page 2) ________________ (7)
(8) Utility Expenses ________________ (8)
(9) Appraisal/BPO ________________ (9)
(10) Property Inspections ________________ (10)
(11) FC Costs/Other Legal Expenses ________________ (11)
(12) Other (itemize) ________________ (12)
Cash for Keys_______________________ ________________ (12)
HOA/Condo Fees______________________ ________________ (12)
______________________________________ ________________ (12)
Total Expenses $ _______________ (13)
Credits:
(14) Escrow Balance $ _______________ (14)
(15) HIP Refund ________________ (15)
(16) Rental Receipts ________________ (16)
(17) Hazard Loss Proceeds ________________ (17)
(18) Primary Mortgage Insurance / Gov't Insurance ________________ (18a)
HUD Part A
________________ (18b)
HUD Part B
(19) Pool Insurance Proceeds ________________ (19)
(20) Proceeds from Sale of Acquired Property ________________ (20)
(21) Other (itemize) ________________ (21)
_________________________________________ ________________ (21)
Total Credits $________________ (22)
Total Realized Loss (or Amount of Gain) $________________ (23)
Escrow Disbursement Detail
------------------------------------------------------------------------------------------------------------
Type Date Paid Period of Total Paid Base Amount Penalties Interest
(Tax/Ins.) Coverage
------------------------------------------------------------------------------------------------------------
EXHIBIT W
Standard File Layout - Delinquency Reporting
------------------------------------------------------------------------------------------------------------------------------------
Column/Header Name Description Decimal Format Comment
------------------------------------------------------------------------------------------------------------------------------------
SERVICER_LOAN_NBR A unique number assigned to a loan by the Servicer. This may be
different than the LOAN_NBR
------------------------------------------------------------------------------------------------------------------------------------
LOAN_NBR A unique identifier assigned to each loan by the originator.
------------------------------------------------------------------------------------------------------------------------------------
CLIENT_NBR Servicer Client Number
------------------------------------------------------------------------------------------------------------------------------------
SERV_INVESTOR_NBR Contains a unique number as assigned by an external servicer to
identify a group of loans in their system.
------------------------------------------------------------------------------------------------------------------------------------
BORROWER_FIRST_NAME First Name of the Borrower.
------------------------------------------------------------------------------------------------------------------------------------
BORROWER_LAST_NAME Last name of the borrower.
------------------------------------------------------------------------------------------------------------------------------------
PROP_ADDRESS Street Name and Number of Property
------------------------------------------------------------------------------------------------------------------------------------
PROP_STATE The state where the property located.
------------------------------------------------------------------------------------------------------------------------------------
PROP_ZIP Zip code where the property is located.
------------------------------------------------------------------------------------------------------------------------------------
BORR_NEXT_PAY_DUE_DATE The date that the borrower's next payment is due to the servicer MM/DD/YYYY
at the end of processing cycle, as reported by Servicer.
------------------------------------------------------------------------------------------------------------------------------------
LOAN_TYPE Loan Type (i.e. FHA, VA, Conv)
------------------------------------------------------------------------------------------------------------------------------------
BANKRUPTCY_FILED_DATE The date a particular bankruptcy claim was filed. MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
BANKRUPTCY_CHAPTER_CODE The chapter under which the bankruptcy was filed.
------------------------------------------------------------------------------------------------------------------------------------
BANKRUPTCY_CASE_NBR The case number assigned by the court to the bankruptcy filing.
------------------------------------------------------------------------------------------------------------------------------------
POST_PETITION_DUE_DATE The payment due date once the bankruptcy has been approved by the MM/DD/YYYY
courts
------------------------------------------------------------------------------------------------------------------------------------
BANKRUPTCY_DCHRG_DISM_DATE The Date The Loan Is Removed From Bankruptcy. Either by MM/DD/YYYY
Dismissal, Discharged and/or a Motion For Relief Was Granted.
------------------------------------------------------------------------------------------------------------------------------------
LOSS_MIT_APPR_DATE The Date The Loss Mitigation Was Approved By The Servicer MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
LOSS_MIT_TYPE The Type Of Loss Mitigation Approved For A Loan Such As;
------------------------------------------------------------------------------------------------------------------------------------
LOSS_MIT_EST_COMP_DATE The Date The Loss Mitigation /Plan Is Scheduled To End/Close MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
LOSS_MIT_ACT_COMP_DATE The Date The Loss Mitigation Is Actually Completed MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FRCLSR_APPROVED_DATE The date DA Admin sends a letter to the servicer with MM/DD/YYYY
instructions to begin foreclosure proceedings.
------------------------------------------------------------------------------------------------------------------------------------
ATTORNEY_REFERRAL_DATE Date File Was Referred To Attorney to Pursue Foreclosure MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FIRST_LEGAL_DATE Notice of 1st legal filed by an Attorney in a Foreclosure Action MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FRCLSR_SALE_EXPECTED_DATE The date by which a foreclosure sale is expected to occur. MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FRCLSR_SALE_DATE The actual date of the foreclosure sale. MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FRCLSR_SALE_AMT The amount a property sold for at the foreclosure sale. 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
EVICTION_START_DATE The date the servicer initiates eviction of the borrower. MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
EVICTION_COMPLETED_DATE The date the court revokes legal possession of the property from MM/DD/YYYY
the borrower.
------------------------------------------------------------------------------------------------------------------------------------
LIST_PRICE The price at which an REO property is marketed. 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
LIST_DATE The date an REO property is listed at a particular price. MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
OFFER_AMT The dollar value of an offer for an REO property. 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
OFFER_DATE_TIME The date an offer is received by DA Admin or by the Servicer. MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
REO_CLOSING_DATE The date the REO sale of the property is scheduled to close. MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
REO_ACTUAL_CLOSING_DATE Actual Date Of REO Sale MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
OCCUPANT_CODE Classification of how the property is occupied.
------------------------------------------------------------------------------------------------------------------------------------
PROP_CONDITION_CODE A code that indicates the condition of the property.
------------------------------------------------------------------------------------------------------------------------------------
PROP_INSPECTION_DATE The date a property inspection is performed. MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
APPRAISAL_DATE The date the appraisal was done. MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
CURR_PROP_VAL The current "as is" value of the property based on brokers price 2
opinion or appraisal.
------------------------------------------------------------------------------------------------------------------------------------
REPAIRED_PROP_VAL The amount the property would be worth if repairs are completed 2
pursuant to a broker's price opinion or appraisal.
------------------------------------------------------------------------------------------------------------------------------------
If applicable:
------------------------------------------------------------------------------------------------------------------------------------
DELINQ_STATUS_CODE FNMA Code Describing Status of Loan
------------------------------------------------------------------------------------------------------------------------------------
DELINQ_REASON_CODE The circumstances which caused a borrower to stop paying on a
loan. Code indicates the reason why the loan is in default for
this cycle.
------------------------------------------------------------------------------------------------------------------------------------
MI_CLAIM_FILED_DATE Date Mortgage Insurance Claim Was Filed With Mortgage Insurance MM/DD/YYYY
Company.
------------------------------------------------------------------------------------------------------------------------------------
MI_CLAIM_AMT Amount of Mortgage Insurance Claim Filed No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
MI_CLAIM_PAID_DATE Date Mortgage Insurance Company Disbursed Claim Payment MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
MI_CLAIM_AMT_PAID Amount Mortgage Insurance Company Paid On Claim 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
POOL_CLAIM_FILED_DATE Date Claim Was Filed With Pool Insurance Company MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
POOL_CLAIM_AMT Amount of Claim Filed With Pool Insurance Company 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
POOL_CLAIM_PAID_DATE Date Claim Was Settled and The Check Was Issued By The Pool MM/DD/YYYY
Insurer
------------------------------------------------------------------------------------------------------------------------------------
POOL_CLAIM_AMT_PAID Amount Paid On Claim By Pool Insurance Company 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
FHA_PART_A_CLAIM_FILED_DATE Date FHA Part A Claim Was Filed With HUD MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FHA_PART_A_CLAIM_AMT Amount of FHA Part A Claim Filed 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
FHA_PART_A_CLAIM_PAID_DATE Date HUD Disbursed Part A Claim Payment MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FHA_PART_A_CLAIM_PAID_AMT Amount HUD Paid on Part A Claim 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
FHA_PART_B_CLAIM_FILED_DATE Date FHA Part B Claim Was Filed With HUD MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FHA_PART_B_CLAIM_AMT Amount of FHA Part B Claim Filed 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
FHA_PART_B_CLAIM_PAID_DATE Date HUD Disbursed Part B Claim Payment MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FHA_PART_B_CLAIM_PAID_AMT Amount HUD Paid on Part B Claim 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
VA_CLAIM_FILED_DATE Date VA Claim Was Filed With the Veterans Admin MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
VA_CLAIM_PAID_DATE Date Veterans Admin. Disbursed VA Claim Payment MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
VA_CLAIM_PAID_AMT Amount Veterans Admin. Paid on VA Claim 2 No commas(,) or
dollar signs ($)
------------------------------------------------------------------------------------------------------------------------------------
MOTION_FOR_RELIEF_DATE The date the Motion for Relief was filed 10 MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
FRCLSR_BID_AMT The foreclosure sale bid amount 11 No commas(,)
or dollar
signs ($)
------------------------------------------------------------------------------------------------------------------------------------
FRCLSR_SALE_TYPE The foreclosure sales results: REO, Third Party,
Conveyance to HUD/VA
------------------------------------------------------------------------------------------------------------------------------------
REO_PROCEEDS The net proceeds from the sale of the REO property. No commas(,)
or dollar
signs ($)
------------------------------------------------------------------------------------------------------------------------------------
BPO_DATE The date the BPO was done.
------------------------------------------------------------------------------------------------------------------------------------
CURRENT_FICO The current FICO score
------------------------------------------------------------------------------------------------------------------------------------
HAZARD_CLAIM_FILED_DATE The date the Hazard Claim was filed with the Hazard 10 MM/DD/YYYY
Insurance Company.
------------------------------------------------------------------------------------------------------------------------------------
HAZARD_CLAIM_AMT The amount of the Hazard Insurance Claim filed. 11 No commas(,)
or dollar
signs ($)
------------------------------------------------------------------------------------------------------------------------------------
HAZARD_CLAIM_PAID_DATE The date the Hazard Insurance Company disbursed the 10 MM/DD/YYYY
claim payment.
------------------------------------------------------------------------------------------------------------------------------------
HAZARD_CLAIM_PAID_AMT The amount the Hazard Insurance Company paid on the 11 No commas(,)
claim. or dollar
signs ($)
------------------------------------------------------------------------------------------------------------------------------------
ACTION_CODE Indicates loan status Number
------------------------------------------------------------------------------------------------------------------------------------
NOD_DATE MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
NOI_DATE MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
ACTUAL_PAYMENT_PLAN_START_DATE MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
ACTUAL_PAYMENT_ PLAN_END_DATE
------------------------------------------------------------------------------------------------------------------------------------
ACTUAL_REO_START_DATE MM/DD/YYYY
------------------------------------------------------------------------------------------------------------------------------------
REO_SALES_PRICE Number
------------------------------------------------------------------------------------------------------------------------------------
REALIZED_LOSS/GAIN As defined in the Servicing Agreement Number
------------------------------------------------------------------------------------------------------------------------------------
Exhibit 2: Standard File Codes - Delinquency Reporting
The Loss Mit Type field should show the approved Loss Mitigation Code as
follows:
o ASUM- Approved Assumption
o BAP- Borrower Assistance Program
o CO- Charge Off
o DIL- Deed-in-Lieu
o FFA- Formal Forbearance Agreement
o MOD- Loan Modification
o PRE- Pre-Sale
o SS- Short Sale
o MISC- Anything else approved by the PMI or Pool Insurer
NOTE: Xxxxx Fargo Bank will accept alternative Loss Mitigation Types to those
above, provided that they are consistent with industry standards. If Loss
Mitigation Types other than those above are used, the Servicer must supply Xxxxx
Fargo Bank with a description of each of the Loss Mitigation Types prior to
sending the file.
The Occupant Code field should show the current status of the property code as
follows:
o Mortgagor
o Tenant
o Unknown
o Vacant
The Property Condition field should show the last reported condition of the
property as follows:
o Damaged
o Excellent
o Fair
o Gone
o Good
o Poor
o Special Hazard
o Unknown
Exhibit 2: Standard File Codes - Delinquency Reporting, Continued
The FNMA Delinquent Reason Code field should show the Reason for Delinquency as
follows:
-----------------------------------------------------------------
Delinquency Code Delinquency Description
-----------------------------------------------------------------
001 FNMA-Death of principal mortgagor
-----------------------------------------------------------------
002 FNMA-Illness of principal mortgagor
-----------------------------------------------------------------
003 FNMA-Illness of mortgagor's family member
-----------------------------------------------------------------
004 FNMA-Death of mortgagor's family member
-----------------------------------------------------------------
005 FNMA-Marital difficulties
-----------------------------------------------------------------
006 FNMA-Curtailment of income
-----------------------------------------------------------------
007 FNMA-Excessive Obligation
-----------------------------------------------------------------
008 FNMA-Abandonment of property
-----------------------------------------------------------------
009 FNMA-Distant employee transfer
-----------------------------------------------------------------
011 FNMA-Property problem
-----------------------------------------------------------------
012 FNMA-Inability to sell property
-----------------------------------------------------------------
013 FNMA-Inability to rent property
-----------------------------------------------------------------
014 FNMA-Military Service
-----------------------------------------------------------------
015 FNMA-Other
-----------------------------------------------------------------
016 FNMA-Unemployment
-----------------------------------------------------------------
017 FNMA-Business failure
-----------------------------------------------------------------
019 FNMA-Casualty loss
-----------------------------------------------------------------
022 FNMA-Energy environment costs
-----------------------------------------------------------------
023 FNMA-Servicing problems
-----------------------------------------------------------------
026 FNMA-Payment adjustment
-----------------------------------------------------------------
027 FNMA-Payment dispute
-----------------------------------------------------------------
029 FNMA-Transfer of ownership pending
-----------------------------------------------------------------
030 FNMA-Fraud
-----------------------------------------------------------------
031 FNMA-Unable to contact borrower
-----------------------------------------------------------------
INC FNMA-Incarceration
-----------------------------------------------------------------
Exhibit 2: Standard File Codes - Delinquency Reporting, Continued
The FNMA Delinquent Status Code field should show the Status of Default as
follows:
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Status Code Status Description
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09 Forbearance
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17 Pre-foreclosure Sale Closing Plan Accepted
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24 Government Seizure
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26 Refinance
-----------------------------------------------------------------
27 Assumption
-----------------------------------------------------------------
28 Modification
-----------------------------------------------------------------
29 Charge-Off
-----------------------------------------------------------------
30 Third Party Sale
-----------------------------------------------------------------
31 Probate
-----------------------------------------------------------------
32 Military Indulgence
-----------------------------------------------------------------
43 Foreclosure Started
-----------------------------------------------------------------
44 Deed-in-Lieu Started
-----------------------------------------------------------------
49 Assignment Completed
-----------------------------------------------------------------
61 Second Lien Considerations
-----------------------------------------------------------------
62 Veteran's Affairs-No Bid
-----------------------------------------------------------------
63 Veteran's Affairs-Refund
-----------------------------------------------------------------
64 Veteran's Affairs-Buydown
-----------------------------------------------------------------
65 Chapter 7 Bankruptcy
-----------------------------------------------------------------
66 Chapter 11 Bankruptcy
-----------------------------------------------------------------
67 Chapter 13 Bankruptcy
-----------------------------------------------------------------
[Company Letter head]
CALCULATION OF REALIZED LOSS/GAIN
Prepared By: Date:
------------------------ ------------------------
Phone:
------------------------
Servicer Loan # Servicer Name:
------------------------ ------------------
Pool: Borrower Name:
------------------------ ------------------
Investor loan # Property Address:
------------------------ ------------------
Type of Liquidation: REO Short Sale
-------- --------
Third Party Chargeoff
-------- --------
Credits:
Proceeds from Sale of Acquired Property $0.00
Escrow Balance
HIP Refund
Rental Receipts
Hazard Loss Proceeds
Primary Mortgage Insurance Proceeds
Other (itemize):
Total Credits: $0.00
Less Expenses:
Attorney's Fees
Bankruptcy Fees
Court Costs (Recording, Filing Fees, Etc.)
Advertising/Sheriff's fees
Title Policy/Report
Real Estate Taxes
Hazard Insurance Premiums
MI Insurance Premiums
Inspections
Property Preservation (Securing, Winterization, Lawn Care, Etc.)
Appraisal/BPO Fees
Repairs
Hazard Loss Expenses
Other (itemize)
Subtotal Expenses: $0.00
Less Interest Advanced:
Interest Advanced to date at Net Rate $0.00
Last Month's Advanced Net Interest $0.00
Accrued Servicing Fees $0.00
Last month Servicing Fees $0.00
Subtotal Expenses: $0.00
Total Expenses: $0.00
Gross Liquidation Proceeds $0.00
Scheduled Principal balance of Mortgage Loan $0.00
Principal Advances passed through to Investor $0.00
Total Realized (Loss) or Amount of Gain: $0.00
Actual Unpaid Principal balance of Mortgage Loan 0.00
Last Month's Advanced Net Interest 0.00
Less Principal Advances 0.00
Realized Gain/Loss 0.00
Remittance due to Investor 0.00
Amount already remitted (or gain not due to Investor) 0.00
Adjusted amount due from Servicer 0.00
This letter certifies that in accordance with the provisions of the respective
Pooling and Servicing Agreement, the attached "Realized Loss Calculation" is
loan level detail of this realized loss for the above referenced deal.
------------------------------------ ------------------------------------
Authorized Signature Printed Name and Title
EXHIBIT X
INTEREST RATE SWAP AGREEMENT
(Multicurrency--Cross Border)
ISDA(R)
International Swap Dealers Association, Inc.
MASTER AGREEMENT
dated as of April 30, 2007
NATIXIS REAL ESTATE CAPITAL SUPPLEMENTAL
NATIXIS FINANCIAL PRODUCTS INC. and INTEREST TRUST 2007-HE2
have entered and/or anticipate entering into one or more transactions (each a
"Transaction") that are or will be governed by this Master Agreement, which
includes the schedule (the "Schedule"), and the documents and other confirming
evidence (each a "Confirmation") exchanged between the parties confirming those
Transactions.
Accordingly, the parties agree as follows: --
1. Interpretation
(a) Definitions. The terms defined in Section 14 and in the Schedule will have
the meanings therein specified for the purpose of this Master Agreement.
(b) Inconsistency. In the event of any inconsistency between the provisions of
the Schedule and the other provisions of this Master Agreement, the Schedule
will prevail. In the event of any inconsistency between the provisions of any
Confirmation and this Master Agreement (including the Schedule), such
Confirmation will prevail for the purpose of the relevant Transaction.
(c) Single Agreement. All Transactions are entered into in reliance on the fact
that this Master Agreement and all Confirmations form a single agreement between
the parties (collectively referred to as this "Agreement"), and the parties
would not otherwise enter into any Transactions.
2. Obligations
(a) General Conditions.
(i) Each party will make each payment or delivery specified in each
Confirmation to be made by it, subject to the other provisions of this
Agreement.
(ii) Payments under this Agreement will be made on the due date for value
on that date in the place of the account specified in the relevant
Confirmation or otherwise pursuant to this Agreement, in freely
transferable funds and in the manner customary for payments in the
required currency. Where settlement is by delivery (that is, other than by
payment), such delivery will be made for receipt on the due date in the
manner customary for the relevant obligation unless otherwise specified in
the relevant Confirmation or elsewhere in this Agreement.
(iii) Each obligation of each party under Section 2(a)(i) is subject to
(1) the condition precedent that no Event of Default or Potential Event of
Default with respect to the other party has occurred and is continuing,
(2) the condition precedent that no Early Termination Date in respect of
the relevant Transaction has occurred or been effectively designated and
(3) each other applicable condition precedent specified in this Agreement.
(a) Change of Account. Either party may change its account for receiving a
payment or delivery by giving notice to the other party at least five Local
Business Days prior to the scheduled date for the payment or delivery to which
such change applies unless such other party gives timely notice of a reasonable
objection to such change.
(b) Netting. If on any date amounts would otherwise be payable:--
(i) in the same currency; and
(ii) in respect of the same Transaction,
by each party to the other, then, on such date, each party's obligation to make
payment of any such amount will be automatically satisfied and discharged and,
if the aggregate amount that would otherwise have been payable by one party
exceeds the aggregate amount that would otherwise have been payable by the other
party, replaced by an obligation upon the party by whom the larger aggregate
amount would have been payable to pay to the other party the excess of the
larger aggregate amount over the smaller aggregate amount.
The parties may elect in respect of two or more Transactions that a net amount
will be determined in respect of all amounts payable on the same date in the
same currency in respect of such Transactions, regardless of whether such
amounts are payable in respect of the same Transaction. The election may be made
in the Schedule or a Confirmation by specifying that subparagraph (ii) above
will not apply to the Transactions identified as being subject to the election,
together with the starting date (in which case subparagraph (ii) above will not,
or will cease to, apply to such Transactions from such date). This election may
be made separately for different groups of Transactions and will apply
separately to each pairing of Offices through which the parties make and receive
payments or deliveries.
(c) Deduction or Withholding for Tax.
(i) Gross-Up. All payments under this Agreement will be made without any
deduction or withholding for or on account of any Tax unless such
deduction or withholding is required by any applicable law, as modified by
the practice of any relevant governmental revenue authority, then in
effect. If a party is so required to deduct or withhold, then that party
("X") will:--
(1) promptly notify the other party ("Y") of such requirement;
(2) pay to the relevant authorities the full amount required to be
deducted or withheld (including the full amount required to be
deducted or withheld from any additional amount paid by X to Y under
this Section 2(d)) promptly upon the earlier of determining that
such deduction or withholding is required or receiving notice that
such amount has been assessed against Y;
(3) promptly forward to Y an official receipt (or a certified copy),
or other documentation reasonably acceptable to Y, evidencing such
payment to such authorities; and
(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to
the payment to which Y is otherwise entitled under this Agreement,
such additional amount as is necessary to ensure that the net amount
actually received by Y (free and clear of Indemnifiable Taxes,
whether assessed against X or Y) will equal the full amount Y would
have received had no such deduction or withholding been required.
However, X will not be required to pay any additional amount to Y to
the extent that it would not be required to be paid but for:--
(A) the failure by Y to comply with or perform any agreement
contained in Section 4(a)(i), 4(a)(iii) or 4(d); or
(B) the failure of a representation made by Y pursuant to
Section 3(f) to be accurate and true unless such failure would
not have occurred but for (I) any action taken by a taxing
authority, or brought in a court of competent jurisdiction, on
or after the date on which a Transaction is entered into
(regardless of whether such action is taken or brought with
respect to a party to this Agreement) or (II) a Change in Tax
Law.
(ii) Liability. If: --
(1) X is required by any applicable law, as modified by the practice
of any relevant governmental revenue authority, to make any
deduction or withholding in respect of which X would not be required
to pay an additional amount to Y under Section 2(d)(i)(4);
(2) X does not so deduct or withhold; and
(3) a liability resulting from such Tax is assessed directly against
X,
then, except to the extent Y has satisfied or then satisfies the liability
resulting from such Tax, Y will promptly pay to X the amount of such
liability (including any related liability for interest, but including any
related liability for penalties only if Y has failed to comply with or
perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)).
(d) Default Interest; Other Amounts. Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant Transaction,
a party that defaults in the performance of any payment obligation will, to the
extent permitted by law and subject to Section 6(c), be required to pay interest
(before as well as after judgment) on the overdue amount to the other party on
demand in the same currency as such overdue amount, for the period from (and
including) the original due date for payment to (but excluding) the date of
actual payment, at the Default Rate. Such interest will be calculated on the
basis of daily compounding and the actual number of days elapsed. If, prior to
the occurrence or effective designation of an Early Termination Date in respect
o-f the relevant Transaction, a party defaults in the performance of any
obligation required to be settled by delivery, it will compensate the other
party on demand if and to the extent provided for in the relevant Confirmation
or elsewhere in this Agreement.
2. Representations
Each party represents to the other party (which representations will be deemed
to be repeated by each party on each date on which a Transaction is entered into
and, in the case of the representations in Section 3(f), at all times until the
termination of this Agreement) that:--
(a) Basic Representations.
(i) Status. It is duly organised and validly existing under the laws of
the jurisdiction of its organisation or incorporation and, if relevant
under such laws, in good standing;
(ii) Powers. It has the power to execute this Agreement and any other
documentation relating to this Agreement to which it is a party, to
deliver this Agreement and any other documentation relating to this
Agreement that it is required by this Agreement to deliver and to perform
its obligations under this Agreement and any obligations it has under any
Credit Support Document to which it is a party and has taken all necessary
action to authorise such execution, delivery and performance;
(iii) No Violation or Conflict. Such execution, delivery and performance
do not violate or conflict with any law applicable to it, any provision of
its constitutional documents, any order or judgment of any court or other
agency of government applicable to it or any of its assets or any
contractual restriction binding on or affecting it or any of its assets;
(iv) Consents. All governmental and other consents that are required to
have been obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party have been obtained and are in lull
force and effect and all conditions of any such consents have been
complied with; and
(v) Obligations Binding. Its obligations under this Agreement and any
Credit Support Document to which it is a party constitute its legal, valid
and binding obligations, enforceable in accordance with their respective
terms (subject to applicable bankruptcy, reorganization, insolvency,
moratorium or similar laws affecting creditors' rights generally and
subject, as to enforceability, to equitable principles of general
application (regardless of whether enforcement is sought in a proceeding
in equity or at law)).
(b) Absence of Certain Events. No Event of Default or Potential Event of Default
or, to its knowledge, Termination Event with respect to it has occurred and is
continuing and no such event or circumstance would occur as a result of its
entering into or performing its obligations under this Agreement or any Credit
Support Document to which it is a party.
(c) Absence of Litigation. There is not pending or, to its knowledge, threatened
against it or any of its Affiliates any action, suit or proceeding at law or in
equity or before any court, tribunal, governmental body, agency or official or
any arbitrator that is likely to affect the legality, validity or enforceability
against it of this Agreement or any Credit Support Document to which it is a
party or its ability to perform its obligations under this Agreement or such
Credit Support Document.
(d) Accuracy of Specified Information. All applicable information that is
furnished in writing by or on behalf of it to the other party and is identified
for the purpose of this Section 3(d) in the Schedule is, as of the date of the
information, true, accurate and complete in every material respect.
(e) Payer Tax Representation. Each representation specified in the Schedule as
being made by it for the purpose of this Section 3(e) is accurate and true.
(f) Payee Tax Representations. Each representation specified in the Schedule as
being made by it for the purpose of this Section 3(f) is accurate and true.
3. Agreements
Each party agrees with the other that, so long as either party has or may have
any obligation under this Agreement or under any Credit Support Document to
which it is a party:--
(a) Furnish Specified Information. It will deliver to the other party or, in
certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs:--
(i) any forms, documents or certificates relating to taxation specified in
the Schedule or any Confirmation;
(ii) any other documents specified in the Schedule or any Confirmation;
and
(iii) upon reasonable demand by such other party, any form or document
that may be required or reasonably requested in writing in order to allow
such other party or its Credit Support Provider to make a payment under
this Agreement or any applicable Credit Support Document without any
deduction or withholding for or on account of any Tax or with such
deduction or withholding at a reduced rate (so long as the completion,
execution or submission of such form or document would not materially
prejudice the legal or commercial position of the party in receipt of such
demand), with any such form or document to be accurate and completed in a
manner reasonably satisfactory to such other party and to be executed and
to be delivered with any reasonably required certification,
in each case by the date specified in the Schedule or such Confirmation or, if
none is specified, as soon as reasonably practicable.
(b) Maintain Authorisations. It will use all reasonable efforts to maintain in
full force and effect all consents of any governmental or other authority that
are required to be obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party and will use all reasonable efforts to
obtain any that may become necessary in the future.
(c) Comply with Laws. It will comply in all material respects with all
applicable laws and orders to which it may be subject if failure so to comply
would materially impair its ability to perform its obligations under this
Agreement or an Credit Support Document to which it is a party.
(d) Tax Agreement. It will give notice of any failure of a representation made
by it under Section 3(f) to be accurate and true promptly upon learning of such
failure.
(e) Payment of Stamp Tax. Subject to Section 11, it will pay any Stamp Tax
levied or imposed upon it or in respect of its execution or performance of this
Agreement by a jurisdiction in which it is incorporated, organised, managed and
controlled, or considered to have its seat, or in which a branch or office
through which it is acting for the purpose of this Agreement is located ("Stamp
Tax Jurisdiction") and will indemnify the other party against any Stamp Tax
levied or imposed upon the other party or in respect of the other party's
execution or performance of this Agreement by any such Stamp Tax Jurisdiction
which is not also a Stamp Tax Jurisdiction with respect to the other party.
4. Events of Default and Termination Events
(a) Events of Default. The occurrence at any time with respect to a party or, if
applicable, any Credit Support Provider of such party or any Specified Entity of
such party of any of the following events constitutes an event of default (an
"Event of Default") with respect to such party:--
(i) Failure to Pay or Deliver. Failure by the party to make, when due, any
payment under this Agreement or delivery under Section 2(a)(i) or 2(e)
required to be made by it if such failure is not remedied on or before the
third Local Business Day after notice of such failure is given to the
party;
(ii) Breach of Agreement. Failure by the party to comply with or perform
any agreement or obligation (other than an obligation to make any payment
under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give
notice of a Termination Event or any agreement or obligation under Section
4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party
in accordance with this Agreement if such failure is not remedied on or
before the thirtieth day after notice of such failure is given to the
party;
(iii) Credit Support Default.
(1) Failure by the party or any Credit Support Provider of such
party to comply with or perform any agreement or obligation to be
complied with or performed by it in accordance with any Credit
Support Document if such failure is continuing after any applicable
grace period has elapsed;
(2) the expiration or termination of such Credit Support Document or
the failing or ceasing of such Credit Support Document to be in full
force and effect for the purpose of this Agreement (in either case
other than in accordance with its terms) prior to the satisfaction
of all obligations of such party under each Transaction to which
such Credit Support Document relates without the written consent of
the other party; or
(3) the party or such Credit Support Provider disaffirms, disclaims,
repudiates or rejects, in whole or in part, or challenges the
validity of such Credit Support Document;
(iv) Misrepresentation. A representation (other than a representation
under Section 3(e) or (f)) made or repeated or deemed to have been made or
repeated by the party or any Credit Support Provider of such party in this
Agreement or any Credit Support Document proves to have been incorrect or
misleading in any material respect when made or repeated or deemed to have
been made or repeated;
(v) Default under Specified Transaction. The party, any Credit Support
Provider of such party or any applicable Specified Entity of such party
(1) defaults under a Specified Transaction and, after giving effect to any
applicable notice requirement or grace period, there occurs a liquidation
of, an acceleration of obligations under, or an early termination of, that
Specified Transaction, (2) defaults, after giving effect to any applicable
notice requirement or grace period, in making any payment or delivery due
on the last payment, delivery or exchange date of, or any payment on early
termination of, a Specified Transaction (or such default continues for at
least three Local Business Days if there is no applicable notice
requirement or grace period) or (3) disaffirms, disclaims, repudiates or
rejects, in whole or in part, a Specified Transaction (or such action is
taken by any person or entity appointed or empowered to operate it or act
on its behalf);
(vi) Cross Default. If "Cross Default" is specified in the Schedule as
applying to the party, the occurrence or existence of (1) a default, event
of default or other similar condition or event (however described) in
respect of such party, any Credit Support Provider of such party or any
applicable Specified Entity of such party under one or more agreements or
instruments relating to Specified Indebtedness of any of them
(individually or collectively) in an aggregate amount of not less than the
applicable Threshold Amount (as specified in the Schedule) which has
resulted in such Specified Indebtedness becoming, or becoming capable at
such time of being declared, due and payable under such agreements or
instruments, before it would otherwise have been due and payable or (2) a
default by such party, such Credit Support Provider or such Specified
Entity (individually or collectively) in making one or more payments on
the due date thereof in an aggregate amount of not less than the
applicable Threshold Amount under such agreements or instruments (after
giving effect to any applicable notice requirement or grace period);
(vii) Bankruptcy. The party, any Credit Support Provider of such party or
any applicable Specified Entity of such party:--
(1) is dissolved (other than pursuant to a consolidation,
amalgamation or merger); (2) becomes insolvent or is unable to pay
its debts or fails or admits in writing its inability generally to
pay its debts as they become due; (3) makes a general assignment,
arrangement or composition with or for the benefit of its creditors;
(4) institutes or has instituted against it a proceeding seeking a
judgment of insolvency or bankruptcy or any other relief under any
bankruptcy or insolvency law or other similar law affecting
creditors' rights, or a petition is presented for its winding-up or
liquidation, and, in the case of any such proceeding or petition
instituted or presented against it, such proceeding or petition (A)
results in a judgment of insolvency or bankruptcy or the entry of an
order for relief or the making of an order for its winding-up or
liquidation or (B) is not dismissed, discharged, stayed or
restrained in each case within 30 days of the institution or
presentation thereof; (5) has a resolution passed for its
winding-up, official management or liquidation (other than pursuant
to a consolidation, amalgamation or merger); (6) seeks or becomes
subject to the appointment of an administrator, provisional
liquidator, conservator, receiver, trustee, custodian or other
similar official for it or for all or substantially all its assets;
(7) has a secured party take possession of all or substantially all
its assets or has a distress, execution, attachment, sequestration
or other legal process levied, enforced or sued on or against all or
substantially all its assets and such secured party maintains
possession, or any such process is not dismissed, discharged, stayed
or restrained, in each case within 30 days thereafter; (8) causes or
is subject to any event with respect to it which, under the
applicable laws of any jurisdiction, has an analogous effect to any
of the events specified in clauses (1) to (7) (inclusive); or (9)
takes any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in, any of the foregoing acts; or
(viii) Merger Without Assumption. The party or any Credit Support Provider
of such party consolidates or amalgamates with, or merges with or into, or
transfers all or substantially all its assets to, another entity and, at
the time of such consolidation, amalgamation, merger or transfer:--
(1) the resulting, surviving or transferee entity fails to assume
all the obligations of such party or such Credit Support Provider
under this Agreement or any Credit Support Document to which it or
its predecessor was a party by operation of law or pursuant to an
agreement reasonably satisfactory to the other party to this
Agreement; or
(2) the benefits of any Credit Support Document fail to extend
(without the consent of the other party) to the performance by such
resulting, surviving or transferee entity of its obligations under
this Agreement.
(b) Termination Events. The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified Entity
of such party of any event specified below constitutes an Illegality if the
event is specified in (i) below, a Tax Event if the event is specified in (ii)
below or a Tax Event Upon Merger if the event is specified in (iii) below, and,
if specified to be applicable, a Credit Event Upon Merger if the event is
specified pursuant to (iv) below or an Additional Termination Event if the event
is specified pursuant to (v) below:--
(i) Illegality. Due to the adoption of, or any change in, any applicable
law after the date on which a Transaction is entered into, or due to the
promulgation of, or any change in, the interpretation by any court,
tribunal or regulatory authority with competent jurisdiction of any
applicable law after such date, it becomes unlawful (other than as a
result of a breach by the party of Section 4(b)) for such party (which
will be the Affected Party): --
(1) to perform any absolute or contingent obligation to make a
payment or delivery or to receive a payment or delivery in respect
of such Transaction or to comply with any other material provision
of this Agreement relating to such Transaction; or
(2) to perform, or for any Credit Support Provider of such party to
perform, any contingent or other obligation which the party (or such
Credit Support Provider) has under any Credit Support Document
relating to such Transaction;
(ii) Tax Event. Due to (x) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or after the date on
which a Transaction is entered into (regardless of whether such action is
taken or brought with respect to a party to this Agreement) or (y) a
Change in Tax Law, the party (which will be the Affected Party) will, or
there is a substantial likelihood that it will, on the next succeeding
Scheduled Payment Date (1) be required to pay to the other party an
additional amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or
6(e)) or (2) receive a payment from which an amount is required to be
deducted or withheld for or on account of a Tax (except in respect of
interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional amount is
required to be paid in respect of such Tax under Section 2(d)(i)(4) (other
than by reason of Section 2(d)(i)(4)(A) or (B));
(iii) Tax Event Upon Merger. The party (the "Burdened Party") on the next
succeeding Scheduled Payment Date will either (1) be required to pay an
additional amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or
6(e)) or (2) receive a payment from which an amount has been deducted or
withheld for or on account of any Indemnifiable Tax in respect of which
the other party is not required to pay an additional amount (other than by
reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of a
party consolidating or amalgamating with, or merging with or into, or
transferring all or substantially all its assets to, another entity (which
will be the Affected Party) where such action does not constitute an event
described in Section 5(a)(viii);
(iv) Credit Event Upon Merger. If "Credit Event Upon Merger" is specified
in the Schedule as applying to the party, such party ("X"), any Credit
Support Provider of X or any applicable Specified Entity of X consolidates
or amalgamates with, or merges with or into, or transfers all or
substantially all its assets to, another entity and such action does not
constitute an event described in Section 5(a)(viii) but the
creditworthiness of the resulting, surviving or transferee entity is
materially weaker than that of X, such Credit Support Provider or such
Specified Entity, as the case may be, immediately prior to such action
(and, in such event, X or its successor or transferee, as appropriate,
will be the Affected Party); or
(v) Additional Termination Event. If any "Additional Termination Event" is
specified in the Schedule or any Confirmation as applying, the occurrence
of such event (and, in such event, the Affected Party or Affected Parties
shall be as specified for such Additional Termination Event in the
Schedule or such Confirmation).
(c) Event of Default and Illegality. If an event or circumstance which would
otherwise constitute or give rise to an Event of Default also constitutes an
Illegality, it will be treated as an Illegality and will not constitute an Event
of Default.
5. Early Termination
(a) Right to Terminate Following Event of Default. If at any time an Event of
Default with respect to a party (the "Defaulting Party") has occurred and is
then continuing, the other party (the "Non-defaulting Party") may, by not more
than 20 days notice to the Defaulting Party specifying the relevant Event of
Default, designate a day not earlier than the day such notice is effective as an
Early Termination Date in respect of all outstanding Transactions. If, however,
"Automatic Early Termination" is specified in the Schedule as applying to a
party, then an Early Termination Date in respect of all outstanding transactions
will occur immediately upon the occurrence with respect to such party of an
Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the
extent analogous thereto, (8), and as of the time immediately preceding the
institution of the relevant proceeding or the presentation of the relevant
petition upon the occurrence with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).
(b) Right to Terminate Following Termination Event.
(i) Notice. If a Termination Event occurs, an Affected Party will,
promptly upon becoming aware of it, notify the other party, specifying the
nature of that Termination Event and each Affected Transaction and will
also give such other information about that Termination Event as the other
party may reasonably require.
(ii) Transfer to Avoid Termination Event. If either an Illegality under
Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected
Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the
Affected Party, the Affected Party will, as a condition to its right to
designate an Early Termination Date under Section 6(b)(iv), use all
reasonable efforts (which will not require such party to incur a loss,
excluding immaterial, incidental expenses) to transfer within 20 days
after it gives notice under Section 6(b)(i) all its rights and obligations
under this Agreement in respect of the Affected Transactions to another of
its Offices or Affiliates so that such Termination Event ceases to exist.
If the Affected Party is not able to make such a transfer it will give
notice to the other party to that effect within such 20 day period,
whereupon the other party may effect such a transfer within 30 days after
the notice is given under Section 6(b)(i).
Any such transfer by a party under this Section 6(b)(ii) will be subject
to and conditional upon the prior written consent of the other party,
which consent will not be withheld if such other party's policies in
effect at such time would permit it to enter into transactions with the
transferee on the terms proposed.
(iii) Two Affected Parties. If an Illegality under Section 5(b)(i)(1) or a
Tax Event occurs and there are two Affected Parties, each party will use
all reasonable efforts to reach agreement within 30 days after notice
thereof is given under Section 6(b)(i) on action to avoid that Termination
Event.
(iv) Right to Terminate. If: --
(1) a transfer under Section 6(b)(ii) or an agreement under Section
6(b)(iii), as the case may be, has not been effected with respect to
all Affected Transactions within 30 days after an Affected Party
gives notice under Section 6(b)(i); or
(2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon
Merger or an Additional Termination Event occurs, or a Tax Event
Upon Merger occurs and the Burdened Party is not the Affected Party,
either party in the case of an Illegality, the Burdened Party in the case
of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event
or an Additional Termination Event if there is more than one Affected
Party, or the party which is not the Affected Party in the case of a
Credit Event Upon Merger or an Additional Termination Event if there is
only one Affected Party may, by not more than 20 days notice to the other
party and provided that the relevant Termination Event is then continuing,
designate a day not earlier than the day such notice is effective as an
Early Termination Date in respect of all Affected Transactions.
(c) Effect of Designation.
(i) If notice designating an Early Termination Date is given under Section
6(a) or (b), the Early Termination Date will occur on the date so
designated, whether or not the relevant Event of Default or Termination
Event is then continuing.
(ii) Upon the occurrence or effective designation of an Early Termination
Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in
respect of the Terminated Transactions will be required to be made, but
without prejudice to the other provisions of this Agreement. The amount,
if any, payable in respect of an Early Termination Date shall be
determined pursuant to Section 6(e).
(d) Calculations.
(i) Statement. On or as soon as reasonably practicable following the
occurrence of an Early Termination Date, each party will make the
calculations on its part, if any, contemplated by Section 6(e) and will
provide to the other party a statement (1) showing, in reasonable detail,
such calculations (including all relevant quotations and specifying any
amount payable under Section 6(e)) and (2) giving details of the relevant
account to which any amount payable to it is to be paid. In the absence of
written confirmation from the source of a quotation obtained in
determining a Market Quotation, the records of the party obtaining such
quotation will be conclusive evidence of the existence and accuracy of
such quotation.
(ii) Payment Date. An amount calculated as being due in respect of any
Early Termination Date under Section 6(e) will be payable on the day that
notice of the amount payable is effective (in the case of an Early
Termination Date which is designated or occurs as a result of an Event of
Default) and on the day which is two Local Business Days after the day on
which notice of the amount payable is effective (in the case of an Early
Termination Date which is designated as a result of a Termination Event).
Such amount will be paid together with (to the extent permitted under
applicable law) interest thereon (before as well as after judgment) in the
Termination Currency, from (and including) the relevant Early Termination
Date to (but excluding) the date such amount is paid, at the Applicable
Rate. Such interest will be calculated on the basis of daily compounding
and the actual number of days elapsed.
(e) Payments on Early Termination. If an Early Termination Date occurs, the
following provisions shall apply based on the parties' election in the Schedule
of a payment measure, either "Market Quotation" or "Loss", and a payment method,
either the "First Method" or the "Second Method". If the parties fail to
designate a payment measure or payment method in the Schedule, it will be deemed
that "Market Quotation" or the "Second Method", as the case may be, shall apply.
The amount, if any, payable in respect of an Early Termination Date and
determined pursuant to this Section will be subject to any Set-off.
(i) Events of Default. If the Early Termination Date results from an Event
of Default: --
(1) First Method and Market Quotation. If the First Method and
Market Quotation apply, the Defaulting Party will pay to the
Non-defaulting Party the excess, if a positive number, of (A) the
sum of the Settlement Amount (determined by the Non-defaulting
Party) in respect of the Terminated Transactions and the Termination
Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party over (B) the Termination Currency Equivalent of
the Unpaid Amounts owing to the Defaulting Party.
(2) First Method and Loss. If the First Method and Loss apply, the
Defaulting Party will pay to the Non-defaulting Party, if a positive
number, the Non-Defaulting Party's Loss in respect of this
Agreement.
(3) Second Method and Market Quotation. If the Second Method and
Market Quotation apply, an amount will be payable equal to (A) the
sum of the Settlement Amount (determined by the Non-defaulting
Party) in respect of the Terminated Transactions and the Termination
Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party less (B) the Termination Currency Equivalent of
the Unpaid Amounts owing to the Defaulting Party. If that amount is
a positive number, the Defaulting Party will pay it to the
Non-defaulting Party; if it is a negative number, the Non-defaulting
Party will pay the absolute value of that amount to the Defaulting
Party.
(4) Second Method and Loss. If the Second Method and Loss apply, an
amount will be payable equal to the Non-defaulting Party's Loss in
respect of this Agreement. If that amount is a positive number, the
Defaulting Party will pay it to the Non-defaulting Party; if it is a
negative number, the Non-defaulting Party will pay the absolute
value of that amount to the Defaulting Party.
(ii) Termination Events. If the Early Termination Date results from a
Termination Event: --
(1) One Affected Party. If there is one Affected Party, the amount
payable will be determined in accordance with Section 6(e)(i)(3), if
Market Quotation applies, or Section 6(e)(i)(4), if Loss applies,
except that, in either case, references to the Defaulting Party and
to the Non-defaulting Party will be deemed to be references to the
Affected Party and the party which is not the Affected Party,
respectively, and, if Loss applies and fewer than all the
Transactions are being terminated, Loss shall be calculated in
respect of all Terminated Transactions.
(2) Two Affected Parties. If there are two Affected Parties: --
(A) if Market Quotation applies, each party will determine a
Settlement Amount in respect of the Terminated Transactions,
and an amount will be payable equal to (I) the sum of (a)
one-half of the difference between the Settlement Amount of
the party with the higher Settlement Amount ("X") and the
Settlement Amount of the party with the lower Settlement
Amount ("Y") and (b) the Termination Currency Equivalent of
the Unpaid Amounts owing to X less (II) the Termination
Currency Equivalent of the Unpaid Amounts owing to Y; and
(B) if Loss applies, each party will determine its Loss in
respect of this Agreement (or, if fewer than all the
Transactions are being terminated, in respect of all
Terminated Transactions) and an amount will be payable equal
to one-half of the difference between the Loss of the party
with the higher Loss ("X") and the Loss of the party with the
lower Loss ("Y").
If the amount payable is a positive number, Y will pay it to X; if
it is a negative number, X will pay the absolute value of that
amount to Y.
(iii) Adjustment for Bankruptcy. In circumstances where an Early
Termination Date occurs because "Automatic Early Termination" applies in
respect of a party, the amount determined under this Section 6(e) will be
subject to such adjustments as are appropriate and permitted by law to
reflect any payments or deliveries made by one party to the other under
this Agreement (and retained by such other party) during the period from
the relevant Early Termination Date to the date for payment determined
under Section 6(d)(ii).
(iv) Pre-Estimate. The parties agree that if Market Quotation applies an
amount recoverable under this Section 6(e) is a reasonable pre-estimate of
loss and not a penalty. Such amount is payable for the loss of bargain and
the loss of protection against future risks and except as otherwise
provided in this Agreement neither party will be entitled to recover any
additional damages as a consequence of such losses.
6. Transfer
Subject to Section 6(b)(ii), neither this Agreement nor any interest or
obligation in or under this Agreement may be transferred (whether by way of
security or otherwise) by either party without the prior written consent of the
other party, except that: --
(a) a party may make such a transfer of this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer of all
or substantially all its assets to, another entity (but without prejudice to any
other right or remedy under this Agreement); and
(b) a party may make such a transfer of all or any part of its interest in any
amount payable to it from a Defaulting Party under Section 6(e).
Any purported transfer that is not in compliance with this Section will be void.
7. Contractual Currency
(a) Payment in the Contractual Currency. Each payment under this Agreement will
be made in the relevant currency specified in this Agreement for that payment
(the "Contractual Currency"). To the extent permitted by applicable law, any
obligation to make payments under this Agreement in the Contractual Currency
will not be discharged or satisfied by any tender in any currency other than the
Contractual Currency, except to the extent such tender results in the actual
receipt by the party to which payment is owed, acting in a reasonable manner and
in good faith in converting the currency so tendered into the Contractual
Currency, of the full amount in the Contractual Currency of all amounts payable
in respect of this Agreement. If for any reason the amount in the Contractual
Currency so received falls short of the amount in the Contractual Currency
payable in respect of this Agreement, the party required to make the payment
will, to the extent permitted by applicable law, immediately pay such additional
amount in the Contractual Currency as may be necessary to compensate for the
shortfall. If for any reason the amount in the Contractual Currency so received
exceeds the amount in the Contractual Currency payable in respect of this
Agreement, the party receiving the payment will refund promptly the amount of
such excess.
(b) Judgments. To the extent permitted by applicable law, if any judgment or
order expressed in a currency other than the Contractual Currency is rendered
(i) for the payment of any amount owing in respect of this Agreement, (ii) for
the payment of any amount relating to any early termination in respect of this
Agreement or (iii) in respect of a judgment or order of another court for the
payment of any amount described in (i) or (ii) above, the party seeking
recovery, after recovery in full of the aggregate amount to which such party is
entitled pursuant to the judgment or order, will be entitled to receive
immediately from the other party the amount of any shortfall of the Contractual
Currency received by such party as a consequence of sums paid in such other
currency and will refund promptly to the other party any excess of the
Contractual Currency received by such party as a consequence of sums paid in
such other currency if such shortfall or such excess arises or results from any
variation between the rate of exchange at which the Contractual Currency is
converted into the currency of the judgment or order for the purposes of such
judgment or order and the rate of exchange at which such party is able, acting
in a reasonable manner and in good faith in converting the currency received
into the Contractual Currency, to purchase the Contractual Currency with the
amount of the currency of the judgment or order actually received by such party.
The term "rate of exchange" includes, without limitation, any premiums and costs
of exchange payable in connection with the purchase of or conversion into the
Contractual Currency.
(c) Separate Indemnities. To the extent permitted by applicable law, these
indemnities constitute separate and independent obligations from the other
obligations in this Agreement, will be enforceable as separate and independent
causes of action, will apply notwithstanding any indulgence granted by the party
to which any payment is owed and will not be affected by judgment being obtained
or claim or proof being made for any other sums payable in respect of this
Agreement.
(d) Evidence of Loss. For the purpose of this Section 8, it will be sufficient
for a party to demonstrate that it would have suffered a loss had an actual
exchange or purchase been made.
8. Miscellaneous
(a) Entire Agreement. This Agreement constitutes the entire Agreement and
understanding of the parties with respect to its subject matter and supersedes
all oral communication and prior writings with respect thereto.
(b) Amendments. No amendment, modification or waiver in respect of this
Agreement will be effective unless in writing (including a writing evidenced by
a facsimile transmission) and executed by each of the parties or confirmed by an
exchange of telexes or electronic messages on an electronic messaging system.
(c) Survival of Obligations. Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.
(d) Remedies Cumulative. Except as provided in this Agreement, the rights,
powers, remedies and privileges provided in this Agreement are cumulative and
not exclusive of any rights, powers, remedies and privileges provided by law.
(e) Counterparts and Confirmations.
(i) This Agreement (and each amendment, modification and waiver in respect
of it) may be executed and delivered in counterparts (including by
facsimile transmission), each of which will be deemed an original.
(ii) The parties intend that they are legally bound by the terms of each
Transaction from the moment they agree to those terms (whether orally or
otherwise). A Confirmation shall be entered into as soon as practicable
and may be executed and delivered in counterparts (including by facsimile
transmission) or be created by an exchange of telexes or by an exchange of
electronic messages on an electronic messaging system, which in each case
will be sufficient for all purposes to evidence a binding supplement to
this Agreement. The parties will specify therein or through another
effective means that any such counterpart, telex or electronic message
constitutes a Confirmation.
(f) No Waiver of Rights. A failure or delay in exercising any right, power or
privilege in respect of this Agreement will not be presumed to operate as a
waiver, and a single or partial exercise of any right, power or privilege will
not be presumed to preclude any subsequent or further exercise, of that right,
power or privilege or the exercise of any other right, power or privilege.
(g) Headings. The headings used in this Agreement are for convenience of
reference only and are not to affect the construction of or to be taken into
consideration in interpreting this Agreement.
9. Offices; Multibranch Parties
(a) If Section 10(a) is specified in the Schedule as applying, each party that
enters into a Transaction through an Office other than its head or home office
represents to the other party that, notwithstanding the place of booking office
or jurisdiction of incorporation or organisation of such party, the obligations
of such party are the same as if it had entered into the Transaction through its
head or home office. This representation will be deemed to be repeated by such
party on each date on which a Transaction is entered into.
(b) Neither party may change the Office through which it makes and receives
payments or deliveries for the purpose of a Transaction without the prior
written consent of the other party.
(c) If a party is specified as a Multibranch Party in the Schedule, such
Multibranch Party may make and receive payments or deliveries under any
Transaction through any Office listed in the Schedule, and the Office through
which it makes and receives payments or deliveries with respect to a Transaction
will be specified in the relevant Confirmation.
10. Expenses
A Defaulting Party will, on demand, indemnify and hold harmless the other party
for and against all reasonable out-of-pocket expenses, including legal fees and
Stamp Tax, incurred by such other party by reason of the enforcement and
protection of its rights under this Agreement or any Credit Support Document to
which the Defaulting Party is a party or by reason of the early termination of
any Transaction, including, but not limited to, costs of collection.
11. Notices
(a) Effectiveness. Any notice or other communication in respect of this
Agreement may be given in any manner set forth below (except that a notice or
other communication under Section 5 or 6 may not be given by facsimile
transmission or electronic messaging system) to the address or number or in
accordance with the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated:--
(i) if in writing and delivered in person or by courier, on the date it is
delivered;
(ii) if sent by telex, on the date the recipient's answerback is received;
(iii) if sent by facsimile transmission, on the date that transmission is
received by a responsible employee of the recipient in legible form (it
being agreed that the burden of proving receipt will be on the sender and
will not be met by a transmission report generated by the sender's
facsimile machine);
(iv) if sent by certified or registered mail (airmail, if overseas) or the
equivalent (return receipt requested), on the date that mail is delivered
or its delivery is attempted; or
(v) if sent by electronic messaging system, on the date that electronic
message is received,
unless the date of that delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that communication is delivered (or
attempted) or received, as applicable, after the close of business on a Local
Business Day, in which case that communication shall be deemed given and
effective on the first following day that is a Local Business Day.
(b) Change of Addresses. Either party may by notice to the other change the
address, telex or facsimile number or electronic messaging system details at
which notices or other communications are to be given to it.
12. Governing Law and Jurisdiction
(a) Governing Law. This Agreement will be governed by and construed in
accordance with the law specified in the Schedule.
(b) Jurisdiction. With respect to any suit, action or proceedings relating to
this Agreement ("Proceedings"), each party irrevocably:--
(i) submits to the jurisdiction of the English courts, if this Agreement
is expressed to be governed by English law, or to the non-exclusive
jurisdiction of the courts of the State of New York and the United States
District Court located in the Borough of Manhattan in New York City, if
this Agreement is expressed to be governed by the laws of the State of New
York; and
(ii) waives any objection which it may have at any time to the laying of
venue of any Proceedings brought in any such court, waives any claim that
such Proceedings have been brought in an inconvenient forum and further
waives the right to object, with respect to such Proceedings, that such
court does not have any jurisdiction over such party.
Nothing in this Agreement precludes either party from bringing Proceedings in
any other jurisdiction (outside, if this Agreement is expressed to be governed
by English law, the Contracting States, as defined in Section 1(3) of the Civil
Jurisdiction and Judgments Xxx 0000 or any modification, extension or
re-enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.
(c) Service of Process. Each party irrevocably appoints the Process Agent (if
any) specified opposite its name in the Schedule to receive, for it and on its
behalf, service of process in any Proceedings. If for any reason any party's
Process Agent is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent acceptable to
the other party. The parties irrevocably consent to service of process given in
the manner provided for notices in Section 12. Nothing in this Agreement will
affect the right of either party to serve process in any other manner permitted
by law.
(d) Waiver of Immunities. Each party irrevocably waives, to the fullest extent
permitted by applicable law, with respect to itself and its revenues and assets
(irrespective of their use or intended use), all immunity on the grounds of
sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any
court, (iii) relief by way of injunction, order for specific performance or for
recovery of property, (iv) attachment of its assets (whether before or after
judgment) and (v) execution or enforcement of any judgment to which it or its
revenues or assets might otherwise be entitled in any Proceedings in the courts
of any jurisdiction and irrevocably agrees, to the extent permitted by
applicable law, that it will not claim any such immunity in any Proceedings.
13. Definitions
As used in this Agreement:--
"Additional Termination Event" has the meaning specified in Section 5(b).
"Affected Party" has the meaning specified in Section 5(b).
"Affected Transactions" means (a) with respect to any Termination Event
consisting of an Illegality, Tax Event or Tax Event Upon Merger, all
Transactions affected by the occurrence of such Termination Event and (b) with
respect to any other Termination Event, all Transactions.
"Affiliate" means, subject to the Schedule, in relation to any person, any
entity controlled, directly or indirectly, by the person, any entity that
controls, directly or indirectly, the person or any entity directly or
indirectly under common control with the person. For this purpose, "control" of
any entity or person means ownership of a majority of the voting power of the
entity or person.
"Applicable Rate" means:--
(a) in respect of obligations payable or deliverable (or which would have been
but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;
(b) in respect of an obligation to pay an amount under Section 6(e) of either
party from and after the date (determined in accordance with Section 6(d)(ii))
on which that amount is payable, the Default Rate;
(c) in respect of all other obligations payable or deliverable (or which would
have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default
Rate; and
(d) in all other cases, the Termination Rate.
"Burdened Party" has the meaning specified in Section 5(b).
"Change in Tax Law" means the enactment, promulgation, execution or ratification
of, or any change in or amendment to, any law (or in the application or official
interpretation of any law) that occurs on or after the date on which the
relevant Transaction is entered into.
"consent" includes a consent, approval, action, authorisation, exemption,
notice, filing, registration or exchange control consent.
"Credit Event Upon Merger" has the meaning specified in Section 5(b).
"Credit Support Document" means any agreement or instrument that is specified as
such in this Agreement.
"Credit Support Provider" has the meaning specified in the Schedule.
"Default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the relevant payee (as certified by it) if it
were to fund or of funding the relevant amount plus 1% per annum.
"Defaulting Party" has the meaning specified in Section 6(a).
"Early Termination Date" means the date determined in accordance with Section
6(a) or 6(b)(iv).
"Event of Default" has the meaning specified in Section 5(a) and, if applicable,
in the Schedule.
"Illegality" has the meaning specified in Section 5(b).
"Indemnifiable Tax" means any Tax other than a Tax that would not be imposed in
respect of a payment under this Agreement but for a present or former connection
between the jurisdiction of the government or taxation authority imposing such
Tax and the recipient of such payment or a person related to such recipient
(including, without limitation, a connection arising from such recipient or
related person being or having been a citizen or resident of such jurisdiction,
or being or having been organised, present or engaged in a trade or business in
such jurisdiction, or having or having had a permanent establishment or fixed
place of business in such jurisdiction, but excluding a connection arising
solely from such recipient or related person having executed, delivered,
performed its obligations or received a payment under, or enforced, this
Agreement or a Credit Support Document).
"law" includes any treaty, law, rule or regulation (as modified, in the ease of
tax matters, by the practice of any relevant governmental revenue authority) and
"lawful" and "unlawful" will be construed accordingly.
"Local Business Day" means, subject to the Schedule, a day on which commercial
banks are open for business (including dealings in foreign exchange and foreign
currency deposits) (a) in relation to any obligation under Section 2(a)(i), in
the place(s) specified in the relevant Confirmation or, if not so specified, as
otherwise agreed by the parties in writing or determined pursuant to provisions
contained, or incorporated by reference, in this Agreement, (b) in relation to
any other payment, in the place where the relevant account is located and, if
different, in the principal financial centre, if any, of the currency of such
payment, (c) in relation to any notice or other communication, including notice
contemplated under Section 5(a)(i), in the city specified in the address for
notice provided by the recipient and, in the case of a notice contemplated by
Section 2(b), in the place where the relevant new account is to be located and
(d) in relation to Section 5(a)(v)(2), in the relevant locations for performance
with respect to such Specified Transaction.
"Loss" means, with respect to this Agreement or one or more Terminated
Transactions, as the case may be, and a party, the Termination Currency
Equivalent of an amount that party reasonably determines in good faith to be its
total losses and costs (or gain, in which case expressed as a negative number)
in connection with this Agreement or that Terminated Transaction or group of
Terminated Transactions, as the case may be, including any loss of bargain, cost
of funding or, at the election of such party but without duplication, loss or
cost incurred as a result of its terminating, liquidating, obtaining or
reestablishing any hedge or related trading position (or any gain resulting from
any of them). Loss includes losses and costs (or gains) in respect of any
payment or delivery required to have been made (assuming satisfaction of each
applicable condition precedent) on or before the relevant Early Termination Date
and not made, except so as to avoid duplication, if Section 6(e)(i)(l) or (3) or
6(e)(ii)(2)(A) applies. Loss does not include a party's legal fees and
out-of-pocket expenses referred to under Section 11. A party will determine its
Loss as of the relevant Early Termination Date, or, if that is not reasonably
practicable, as of the earliest date thereafter as is reasonably practicable. A
party may (but need not) determine its Loss by reference to quotations of
relevant rates or prices from one or more leading dealers in the relevant
markets.
"Market Quotation" means, with respect to one or more Terminated Transactions
and a party making the determination, an amount determined on the basis of
quotations from Reference Market-makers. Each quotation will be for an amount,
if any, that would be paid to such party (expressed as a negative number) or by
such party (expressed as a positive number) in consideration of an agreement
between such party (taking into account any existing Credit Support Document
with a respect to the obligations of such party) and the quoting Reference
Market-maker to enter into a transaction (the "Replacement Transaction") that
would have the effect of preserving for such party the economic equivalent of
any payment or delivery (whether the underlying obligation was absolute or
contingent and assuming the satisfaction of each applicable condition precedent)
by the parties under Section 2(a)(i) in respect of such Terminated Transaction
or group of Terminated Transactions that would, but for the occurrence of the
relevant Early Termination Date, have been required after that date. For this
purpose, Unpaid Amounts in respect of the Terminated Transaction or group of
Terminated Transactions are to be excluded but, without limitation, any payment
or delivery that would, but for the relevant Early Termination Date, have been
required (assuming satisfaction of each applicable condition precedent) after
that Early Termination Date is to be included. The Replacement Transaction would
be subject to such determination as such party and the Reference Market-maker
may, in good faith, agree. The party making the determination (or its agent)
will request each Reference Market-maker to provide its quotation to the extent
reasonably practicable as of the same day and time (without regard to different
time zones) on or as soon as reasonably practicable after the relevant Early
Termination Date. The day and time as of which those quotations are to be
obtained will be selected in good faith by the party obliged to make a
determination under Section 6(e), and, if each party is so obliged, after
consultation with the other. If more than three quotations are provided, the
Market Quotation will be the arithmetic mean of the quotations, without regard
to the quotations having the highest and lowest values. If exactly three such
quotations are provided, the Market Quotation will be the quotation remaining
after disregarding the highest and lowest quotations. For this purpose, if more
than one quotation has the same highest value or lowest value, then one of such
quotations shall be disregarded. If fewer than three quotations are provided, it
will be deemed that the Market Quotation in respect of such Terminated
Transaction or group of Terminated Transactions cannot be determined.
"Non-default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the Non-defaulting Party (as certified by it) if
it were to fund the relevant amount.
"Non-defaulting Party" has the meaning specified in Section 6(a).
"Office" means a branch or office of a party, which may be such party's head or
home office.
"Potential Event of Default" means any event which, with the giving of notice or
the lapse of time or both, would constitute an Event of Default.
"Reference Market-makers" means four leading dealers in the relevant market
selected by the party determining a Market Quotation in good faith (a) from
among dealers of the highest credit standing which satisfy all the criteria that
such party applies generally at the time in deciding whether to offer or to make
an extension of credit and (b) to the extent practicable, from among such
dealers having an office in the same city.
"Relevant Jurisdiction" means, with respect to a party, the jurisdictions (a) in
which the party is incorporated, organised, managed and controlled or considered
to have its seat, (b) where an Office through which the party is acting for
purposes of this Agreement is located, (c) in which the party executes this
Agreement and (d) its relation to any payment, from or through which such
payment is made.
"Scheduled Payment Date" means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.
"Set-off" means set-off, offset, combination of accounts, right of retention or
withholding or similar right or requirement to which the payer of an amount
under Section 6 is entitled or subject (whether arising under this Agreement,
another contract, applicable law or otherwise) that is exercised by, or imposed
on, such payer.
"Settlement Amount" means, with respect to a party and any Early Termination
Date, the sum of: --
(a) the Termination Currency Equivalent of the Market Quotations (whether
positive or negative) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation is determined; and
(b) such party's Loss (whether positive or negative and without reference to any
Unpaid Amounts) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation cannot be determined or would not (in
the reasonable belief of the party making the determination) produce a
commercially reasonable result.
"Specified Entity" has the meanings specified in the Schedule.
"Specified Indebtedness" means, subject to the Schedule, any obligation (whether
present or future, contingent or otherwise, as principal or surety or otherwise)
in respect of borrowed money.
"Specified Transaction" means, subject to the Schedule, (a) any transaction
(including an agreement with respect thereto) now existing or hereafter entered
into between one party to this Agreement (or any Credit Support Provider of such
party or any applicable Specified Entity of such party) and the other party to
this Agreement (or any Credit Support Provider of such other party or any
applicable Specified Entity of such other party) which is a rate swap
transaction, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions), (b) any combination of
these transactions and (c) any other transaction identified as a Specified
Transaction in this Agreement or the relevant confirmation.
"Stamp Tax" means any stamp, registration, documentation or similar tax.
"Tax" means any present or future tax, levy, impost, duty, charge, assessment or
fee of any nature (including interest, penalties and additions thereto) that is
imposed by any government or other taxing authority in respect of any payment
under this Agreement other than a stamp, registration, documentation or similar
tax.
"Tax Event" has the meaning specified in Section 5(b).
"Tax Event Upon Merger" has the meaning specified in Section 5(b).
"Terminated Transactions" means with respect to any Early Termination Date (a)
if resulting from a Termination Event, all Affected Transactions and (b) if
resulting from an Event of Default, all Transactions (in either ease) in effect
immediately before the effectiveness of the notice designating that Early
Termination Date (or, if "Automatic Early Termination" applies, immediately
before that Early Termination Date).
"Termination Currency" has the meaning specified in the Schedule.
"Termination Currency Equivalent" means, in respect of any amount denominated in
the Termination Currency, such Termination Currency amount and, in respect of
any amount denominated in a currency other than the Termination Currency (the
"Other Currency"), the amount in the Termination Currency determined by the
party making the relevant determination as being required to purchase such
amount of such Other Currency as at the relevant Early Termination Date, or, if
the relevant Market Quotation or Loss (as the case may be), is determined as of
a later date, that later date, with the Termination Currency at the rate equal
to the spot exchange rate of the foreign exchange agent (selected as provided
below) for the purchase of such Other Currency with the Termination Currency at
or about 11:00 a.m. (in the city in which such foreign exchange agent is
located) on such date as would be customary for the determination of such a rate
for the purchase of such Other Currency for value on the relevant Early
Termination Date or that later date. The foreign exchange agent will, if only
one party is obliged to make a determination under Section 6(e), be selected in
good faith by that party and otherwise will be agreed by the parties.
"Termination Event" means an Illegality, a Tax Event or a Tax Event Upon Merger
or, if specified to be applicable, a Credit Event Upon Merger or an Additional
Termination Event.
"Termination Rate" means a rate per annum equal to the arithmetic mean of the
cost (without proof or evidence of any actual cost) to each party (as certified
by such party) if it were to fund or of funding such amounts.
"Unpaid Amounts" owing to any party means, with respect to an Early Termination
Date, the aggregate of (a) in respect of all Terminated Transactions, the
amounts that became payable (or that would have become payable but for Section
2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early
Termination Date and which remain unpaid as at such Early Termination Date and
(b) in respect of each Terminated Transaction, for each obligation under Section
2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be
settled by delivery to such party on or prior to such Early Termination Date and
which has not been so settled as at such Early Termination Date, an amount equal
to the fair market value of that which was (or would have been) required to be
delivered as of the originally scheduled date for delivery, in each case
together with (to the extent permitted under applicable law) interest, in the
currency of such amounts, from (and including) the date such amounts or
obligations were or would have been required to have been paid or performed to
(but excluding) such Early Termination Date, at the Applicable Rate. Such
amounts of interest will be calculated on the basis of daily compounding and the
actual value of that which was (or would have been) required to be delivered as
of the originally scheduled date for delivery, in each case together with (to
the extent permitted under applicable law) interest, in the currency of such
amounts, from (and including) the date such amounts or obligations were or would
have been required to have been paid or performed to (but excluding) such Early
Termination Date, at the Applicable Rate. Such amounts of interest will be
calculated on the basis of daily compounding and the actual number of days
elapsed. The fair market value of any obligation referred to in clause (b) above
shall be reasonably determined by the party obliged to make the determination
under Section 6(e) or, if each party is so obliged, it shall be the average of
the Termination Currency Equivalents of the fair market values reasonably
determined by both parties.
IN WITNESS WHEREOF the parties have executed this document on the respective
dates specified below with effect from the date specified on the first page of
this document.
NATIXIS REAL ESTATE CAPITAL SUPPLEMENTAL
NATIXIS FINANCIAL PRODUCTS INC. INTEREST TRUST 2007-HE
------------------------------- --------------------------------------------
By: Xxxxx Fargo Bank, National Association,
not in its individual capacity but solely as
Securities Administrator
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxxx Xxxx
----------------------------- -------------------------
Name: Xxxxxxx X. Xxxxxx Name: Xxxxxx Xxxx
Title: Managing Director Title: Vice President
Date: 4/30/07 Date: April 30, 2007
/s/ Xxxxxxxxxxx Xxxxxx
Xxxxxxxxxxx Xxxxxx
Managing Director
SCHEDULE
to the
1992 MASTER AGREEMENT
dated as of April 30, 2007
between
NATIXIS FINANCIAL PRODUCTS INC.
("Party A"),
and
NATIXIS REAL ESTATE CAPITAL SUPPLEMENTAL INTEREST TRUST 2007--HE2
a trust organized under the laws of the State of New York
("Party B" or the "Trust").
Part 1. Termination Provisions
(a) "Specified Entity" means in relation to Party A for the purpose of:
Section 5(a)(v) (Default under Specified Transaction), Not
Applicable.
Section 5(a)(vi) (Cross Default), Not Applicable.
Section 5(a)(vii) (Bankruptcy), Not Applicable.
Section 5(b)(iv) (Credit Event Upon Merger), Not Applicable.
and in relation to Party B for the purpose of:
Section 5(a)(v) (Default under Specified Transaction), Not
Applicable.
Section 5(a)(vi) (Cross Default), Not Applicable.
Section 5(a)(vii) (Bankruptcy), Not Applicable.
Section 5(b)(iv) (Credit Event Upon Merger), Not Applicable.
(b) "Specified Transaction" will have the meaning specified in Section 14
of this Agreement.
(c) The "Breach of Agreement" provisions of Section 5(a)(ii) will not
apply to Party A or Party B.
(d) The "Misrepresentation" provisions of Section 5(a)(iv) will apply to
Party A and will not apply to Party B.
(e) The "Credit Support Default" provisions of Section 5(a)(iii) will
apply to Party A and will not apply to Party B.
(f) The "Cross Default" provisions of Section 5(a)(vi) will apply to Party
A and will not apply to Party B; provided, however, that the Cross Default of
Section 5(a)(vi) shall exclude any default that results solely from wire
transfer difficulties or an error or omission of an administrative or
operational nature (so long as sufficient funds are available), or from the
general unavailability or non-transferability of the currency in which such
Specified Indebtedness is denominated due to exchange controls or similar or
other governmental action (but only if payment is made within three Local
Business Days after such transfer difficulties have been corrected, the error or
omission has been discovered or such currency becomes available), or is being
contested in good faith by appropriate proceedings.
If such provisions apply:
"Specified Indebtedness" will have the meaning specified in Section 14 of
this Agreement.
"Threshold Amount" means with respect to Party A 3.0% of Party A's
shareholder's equity (excluding deposits).
(g) The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will not
apply to Party A or Party B.
(h) The "Automatic Early Termination" provisions of Section 6(a) will not
apply to Party A or to Party B.
(i) Section 5(a)(i) is here by amended by deleting the word "third" in the
last line thereof and replacing it with the word "first".
(j) Section 5(a)(vii)(2), (7) and (9) (Bankruptcy) will not apply to Party
B. In addition, Section 5(a)(vii)(4) will not apply to Party B to the extent
that it refers to proceedings or petitions instituted or presented by Party A or
any of its Affiliates; provided that, nothing herein shall be construed to limit
or affect Section 5(a)(vii)(4) with respect to proceedings which have already
been commenced by any other persons, even if Party A thereafter joins or
participates. Section 5(a)(vii)(6) will not apply to Party B to the extent that
it refers to (i) any appointment that is contemplated or effected by the Pooling
and Servicing Agreement or (ii) any appointment to which Party B has not become
subject.
(k) Notwithstanding Sections 5(a)(i) and 5(a)(iii), any failure by Party A
to comply with or perform any obligation to be complied with or performed by
Party A under any credit support annex from time to time entered into between
Party A and Party B in relation to this Master Agreement shall not be an Event
of Default unless (A) the Second Rating Trigger Requirements apply and at least
30 Local Business Days have elapsed since the last time the Second Rating
Trigger Requirements did not apply and (B) such failure is not remedied on or
before the third Local Business Day after notice of such failure is given to
Party A.
(l) Section 5(b)(ii) will apply to Party A and Party B, provided that the
words "(x) any action taken by a taxing authority, or brought in a court of
competent jurisdiction, on or after the date on which a Transaction is entered
into (regardless of whether such action is taken or brought with respect to a
party to this Agreement) or (y)" shall be deleted.
(m) Section 5(b)(iii) will apply to Party A and Party B, provided that
Party A shall not be entitled to designate an Early Termination Date by reason
of a Tax Event upon Merger in respect of which it is the Affected Party.
(n) Section 6(b)(ii) will apply to Party A and Party B, provided that the
words "or if a Tax Event Upon Merger occurs and the Burdened Party is the
Affected Party" shall be deleted.
(o) Payments on Early Termination. For the purpose of Section 6(e):
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(iii) Notwithstanding Section 6 of this Agreement, so long as Party
A is (A) the sole Affected Party in respect of an Additional Termination
Event or a Tax Event Upon Merger or (B) the Defaulting Party in respect of
any Event of Default, paragraphs (1) to (9) below shall apply:
(1) For the purposes of Section 6(d)(i), Party B's obligation with
respect to the extent of information to be provided with its
calculations is limited to information Party B has already
received in writing which Party B is able to release without
breaching any contractual obligations or the provisions of any
law applicable to Party B.
(2) The definition of "Market Quotation" shall be deleted in its
entirety and replaced with the following:
"Market Quotation" means, with respect to one or more Terminated
Transactions, a Firm Offer which is (1) made by a Reference
Market-maker that is an Eligible Replacement, (2) for an amount that
would be paid to Party B (expressed as a negative number) or by
Party B (expressed as a positive number) in consideration of an
agreement between Party B and such Reference Market-maker to enter
into a transaction (the "Replacement Transaction") that would have
the effect of preserving for such party the economic equivalent of
any payment or delivery (whether the underlying obligation was
absolute or contingent and assuming the satisfaction of each
applicable condition precedent) by the parties under Section 2(a)(i)
in respect of such Terminated Transactions or group of Terminated
Transactions that would, but for the occurrence of the relevant
Early Termination Date, have been required after that Date, (3) made
on the basis that Unpaid Amounts in respect of the Terminated
Transaction or group of Transactions are to be excluded but, without
limitation, any payment or delivery that would, but for the relevant
Early Termination Date, have been required (assuming satisfaction of
each applicable condition precedent) after that Early Termination
Date is to be included and (4) made in respect of a Replacement
Transaction with commercial terms substantially the same as those of
this Agreement (save for the exclusion of provisions relating to
Transactions that are not Terminated Transactions)."
(3) The definition of "Settlement Amount" shall be deleted in its
entirety and replaced with the following:
"Settlement Amount" means, with respect to any Early Termination
Date, an amount (as determined by Party B based on information
provided by the Reference Market-maker) equal to:
(i) If a Market Quotation for the relevant Terminated
Transaction or group of Terminated Transactions is accepted by
Party B so as to become legally binding on or before the day
falling ten Local Business Days after the day on which the
Early Termination Date is designated (or such later day as
Party B may specify in writing to Party A, which in any event
will not be later than the Early Termination Date) (such day,
the "Latest Settlement Amount Determination Day"), the
Termination Currency Equivalent of the amount (whether
positive or negative) of such Market Quotation; or
(ii) If no Market Quotation for the relevant Terminated
Transaction or group of Terminated Transactions is accepted by
Party B so as to become legally binding on or before the
Latest Settlement Amount Determination Day, Party B's Loss
(whether positive or negative and without reference to any
Unpaid amounts) for the relevant Terminated Transaction or
group of Terminated Transactions.
(4) For the purpose of clause (4) of the definition of Market
Quotation, Party B shall determine, based on information
provided by the Reference Market-maker, whether a Firm Offer
is made in respect of a Replacement Transaction with
commercial terms substantially the same as those of this
Agreement (save for the exclusion of provisions relating to
Transactions that are not Terminated Transactions).
(5) Party B undertakes to use its reasonable efforts to obtain at
least one Market Quotation before the Latest Settlement Amount
Determination Day.
(6) Party B will be deemed to have discharged its obligations
under (4) above if it requests Party A to obtain Market
Quotations, where such request is made in writing within two
Local Business Days after the day on which the Early
Termination Date is designated.
(7) if Party B requests Party A in writing (within two Local
Business days after the date on which an Early Termination
Date is designated) to obtain Market Quotations, Party A shall
use its reasonable efforts to do so before the Latest
Settlement Amount Determination Day.
(8) Any amount calculated as being due in respect of an Early
Termination Date will be payable in accordance with Section
6(d)(ii), provided that if such payment is owed to Party B, it
will be payable on the day that notice of the amount payable
is given to Party A if, and only if, Party A receives such
notice by 10:00 am New York time; otherwise such amount will
be payable to Party B on the next succeeding Business Day.
(9) If the Settlement Amount is a negative number, Section
6(e)(i)(3) of this Agreement shall be deleted in its entirety
and replaced with the following:
"Second Method and Market Quotation. If Second Method and Market
Quotation apply, (1) Party B shall pay to Party A an amount equal to
the absolute value of the Settlement Amount in respect of the
Terminated Transactions, (2) Party B shall pay to Party A the
Termination Currency Equivalent of the Unpaid Amounts owing to Party
A and (3) Party A shall pay to Party B the Termination Currency
Equivalent of the Unpaid Amounts owing to Party B, provided that,
(i) the amounts payable under (2) and (3) shall be subject to
netting in accordance with Section 2(c) of this Agreement and (ii)
notwithstanding any other provision of this Agreement, any amount
payable by Party A under (3) shall not be set-off against any amount
payable by Party B under (1)."
(p) "Termination Currency" means the currency selected by the
Non-defaulting Party, the non-Affected Party, or the Burdened Party, as the case
may be or, in circumstances where there are two Affected Parties, the currency
agreed to between the parties and failing such agreement, the Termination
Currency shall be United States Dollars ("USD"). However, the Termination
Currency selected by the Non-defaulting Party or the non-Affected Party, as the
case may be shall (i) be one of the currencies in which payments in any
Terminated Transaction are required to be made, and (ii) be freely transferable
into all other currencies in which payments are to be made in respect of any
Terminated Transaction.
(q) The "Additional Termination Event" provisions of Section 5(b)(v) will
apply. "Additional Termination Events" means:
(i) the delivery of notice by Party B or the Trustee of the
designation of an Optional Termination Date pursuant to the Pooling and
Servicing Agreement, in which event, Party B shall be the sole Affected
Party and all Transactions shall be Affected Transactions; provided,
however, that the Early Termination Date shall be no earlier than the
Distribution Date related to such Optional Termination Date;
(ii) the irrevocable direction to dissolve or otherwise terminate
the Trust following which all assets of the Trust will be liquidated and
the proceeds thereof will be distributed to Certificateholders, in which
event, Party B shall be the sole Affected Party and all Transactions shall
be Affected Transactions;
(iii) the entry by Party B, without the prior written consent of
Party A (which consent shall not be unreasonably withheld or delayed),
into any amendment, modification or change to the Pooling and Servicing
Agreement, if such amendment, modification or change could reasonably be
expected to have a material adverse effect on the rights or obligations of
Party A hereunder or under the Pooling and Servicing Agreement, in which
event, Party B shall be the sole Affected Party and all Transactions shall
be Affected Transactions. As required in the Pooling and Servicing
Agreement, Party B will furnish to Party A a copy of each proposed
amendment, modification or change to the Pooling and Servicing Agreement
and a copy of each executed amendment, modification or change to the
Pooling and Servicing Agreement and copies of the letter from each Rating
Agency stating that such amendment, modification or change would not
result in the downgrading or withdrawal of the respective ratings then
assigned to the Certificates;
(iv) the failure of Party A to satisfy any of the requirements of
Part 5(j)(ii)(B) following a Collateralization Event under Part 5(j)(i)(B)
or (C), or the requirements of Part 5(k)(ii)(B) following a Substitution
Event, in which event, Party A shall be the sole Affected Party and all
Transactions shall be Affected Transactions;
(v) the failure of Party A to satisfy any of the requirements of
Part 5(j)(ii)(A) following a Collateralization Event under Part
5(j)(i)(A), or the requirements of Part 5(k)(ii)(A) following a
Substitution Event; provided that with respect to a Substitution Event
under Part 5(k)(i)(B), (a) the Second Rating Trigger Requirements apply
and 30 or more Local Business Days have elapsed since the last time the
Second Rating Trigger Requirements did not apply and (b) (i) at least one
Eligible Replacement has made a Firm Offer (which remains capable of
becoming legally binding upon acceptance) to be the transferee of a
transfer to be made in accordance with Part 5(i) and/or (ii) at least one
entity with the First Trigger Required Ratings and/or the Second Trigger
Required Ratings has made a Firm Offer (which remains capable of becoming
legally binding upon acceptance by the offeree) to provide an Eligible
Guarantee in respect of all of Party A's present and future obligations
under this Agreement, in which event, Party A shall be the sole Affected
Party and all Transactions shall be Affected Transactions; and
(vi) the failure of Party A to satisfy any of the requirements of
Part 5(t), within the applicable time periods set forth therein, in which
event Party A shall be the sole Affected Party and all Transactions shall
be Affected Transactions.
(r) The "Default Under Specified Transaction" provisions of Section
5(a)(v) will not apply to Party A or Party B.
Part 2. Tax Representations.
(a) Payer Tax Representations. For purposes of Section 3(e) of the
Agreement, Party A and Party B each made 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 the Agreement) to be made by it to
the other party under the 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 the Agreement, (ii) the
satisfaction of the agreement contained in Section 4(a)(i) or
4(a)(iii) of the 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 the Agreement, and (iii) the satisfaction of the
agreement of the other party contained in Section 4(d) of the
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 Tax Representations. For the purpose of Section 3(f) of the
Agreement, Party A makes the following representation:
(i) Party A is a corporation organized under the laws of Delaware.
For the purpose of Section 3(f) of the Agreement, Party B makes the following
representations:
(i) Party B is a trust created under an agreement governed by New
York law which is a disregarded entity whose sole owner is a Cayman
Islands corporation.
Part 3. Agreement to Deliver Documents.
For the purpose of Section 4(a), each party agrees to deliver the
following documents, as applicable:
(a) Tax forms, documents, or certificates to be delivered are:
Party A agrees to complete (accurately and in a manner reasonably
satisfactory to Party B), execute, and deliver to Party B, United
States Internal Revenue Service Form W-9, or any successor of such
form, (i) before the first Payment Date under the Agreement, (ii)
promptly upon reasonable demand by Party B, and (iii) promptly upon
learning that any such form(s) previously provided by Party A has
become obsolete or is incorrect.
Party B agrees to complete (accurately and in a manner reasonably
satisfactory to Party A), execute, and deliver to Party A, United
States Internal Revenue Service Form W-8BEN, or any successor of
such form, (i) before the first Payment Date under the Agreement,
(ii) promptly upon reasonable demand by Party A, and (iii) promptly
upon obtaining actual knowledge that any such form(s) previously
provided by Party B has become obsolete or is incorrect.
(b) Other documents to be delivered are:
Covered by
Party required to Date by which Section 3(d)
deliver document Form/Document/Certificate to be delivered Representation
Party A Each of (i) the Credit Support On the Closing Date Yes
Document of Party A and (ii)
certificates or other documents
evidencing the authority of Party A,
and the persons acting on behalf of
Party A, to enter into this
Agreement, each Transaction, and the
Credit Support Document, respectively.
Party B Each of (i) an executed copy of the On the Closing Date Yes
Pooling and Servicing Agreement and
the other material operative
documents relating thereto and
referred to therein, executed and
delivered by the parties thereto and
(ii) certificates or other documents
evidencing the authority of Party B
in relation to the Agreement and each
Transaction and the persons acting on
behalf of Party B in relation thereto
Party B Monthly Statements and Servicer In accordance with
Remittance Reports (as defined in the the Pooling and
Pooling and Servicing Agreement) Servicing Agreement
Party A/Party B Each of (i) opinion of in-house On the Closing Date No
counsel to Party A in form and
substance satisfactory to Party B and
opinion of in-house counsel to Party
A's Credit Support Provider and (ii)
opinions of counsel to Party B in
form and substance reasonably
satisfactory to Party A
Part 4. Miscellaneous.
(a) Addresses for Notices. For the Purpose of Section 12(a):
(i) Address for notices or communications to Party A:
NATIXIS FINANCIAL PRODUCTS INC.
Address: Harborside Financial Xxxxxx
Xxxxx X, 00xx Xxxxx
Xxxxxx Xxxx, XX 00000
Attention: Swaps Administration
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
with a copy to:
NATIXIS FINANCIAL PRODUCTS INC.
Address: 0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
(ii) Address for notices or communications to Party B:
c/o Securities Administrator:
Address: Xxxxx Fargo Bank, National Association
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Services, Client Services Manager
Natixis Real Estate Capital Trust 2007-HE2
(iii) Section 12(a) of this Agreement is hereby amended by (i)
adding after the words "may not be given", the words "and shall not
be effective if given"; and (ii) adding after the words "under
Section 5 or 6" the words, "or Section 13(c)".
(b) Process Agent. For the purpose of Section 13(c):
Party A appoints as its Process Agent: Not Applicable.
Party B appoints as its Process Agent: Not Applicable.
(c) Offices; Multibranch Parties.
(i) The provisions of Section 10(a) will be applicable to the
Agreement.
(ii) For the purpose of Section 10(c) of the Agreement:
Party A is not a Multibranch Party.
Party B is not a Multibranch Party.
(d) Calculation Agent. The Calculation Agent is Party A.
(e) Governing Law. The Agreement and each Confirmation will, in accordance
with Section 5-1401 of the General Obligations Law of the State of New York, be
governed by, and construed and enforced in accordance with, the law of the State
of New York.
(f) Waiver of Right to Trial by Jury. EACH PARTY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY SUIT, ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY
CREDIT SUPPORT DOCUMENT.
(g) Jurisdiction. Section 13(b) is hereby amended by: (i) deleting in the
second line of Subparagraph (i) thereof the word "non-"; and (ii) deleting the
final paragraph thereof.
(h) "Affiliate" will have the meaning specified in Section 14, except that
it shall not apply to Party B.
(i) "Netting of Payments." Subparagraph (ii) of Section 2(c) of the
Agreement will apply to all Transactions under the Agreement.
(j) Credit Support Document. Details of any Credit Support Document:
(i) Party A: (A) the guarantee of the obligations of Party A by IXIS
Corporate & Investment Bank dated as of November 1, 2004 and (B) the ISDA
1994 New York Credit Support Annex entered into pursuant to Part 5(j)(ii)
or Part 5(t)(C)(1) (the "Credit Support Annex"); provided that Party A
shall not be required to post any Eligible Collateral except as and to the
extent provided herein; and
(ii) Party B: Not Applicable.
(k) Credit Support Provider. Credit Support Provider means:
(i) in relation to Party A: IXIS Corporate & Investment Bank, a
limited liability company with executive and supervisory boards (societe
anonyme a directoire et conseil de surveillance) organized under the laws
of the Republic of France; and
(ii) in relation to Party B: Not Applicable.
Part 5. Other Provisions.
(a) Definitions. The 2000 ISDA Definitions (the "Definitions") are
incorporated into the Agreement and shall form part of the Agreement. In the
event of any inconsistency among or between any of the following documents, the
relevant document first listed below shall govern: (i) a Confirmation; (ii) this
Schedule; (iii) any other relevant definitions incorporated herein or in any
Confirmation; (iv) the Definitions; (v) Sections 1 to 14 of the Agreement.
"Pooling and Servicing Agreement" means that certain Pooling and
Servicing Agreement, April 1, 2007, among Xxxxxx Xxxxxxx ABS Capital I Inc., as
Depositor, Xxxxx Fargo Bank, National Association, as Master Servicer and as
Securities Administrator, Saxon Mortgage Services, Inc., as Servicer, Natixis
Real Estate Capital Inc., as Unaffiliated Seller and Deutsche Bank National
Trust Company, as Trustee and Custodian, as the same may be amended or
supplemented from time to time.
Capitalized terms used in this Schedule but not defined in the
Definitions, Section 14 of the Agreement or elsewhere herein shall have the
meanings assigned to them in the Pooling and Servicing Agreement.
(b) Severability. If any term, provision, covenant, or condition of the
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 the Agreement had been executed with the invalid or
unenforceable portion eliminated, so long as the Agreement as so modified
continues to express, without material change, the original intentions of the
parties as to the subject matter of the Agreement and the deletion of such
portion of the Agreement will not substantially impair the respective benefits
or expectations of the parties to the Agreement; provided, however, that this
severability provision shall not be applicable if any provision of Section 1(c),
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.
(c) Waiver of Right to Trial by Jury. Party A and Party B hereby
irrevocably waive any and all right to trial by jury with respect to any legal
proceeding arising out of or relating to this Agreement or any Transaction
contemplated hereby.
(d) Change of Account. Section 2(b) of this Agreement is hereby amended by
the insertion of the following at the end thereof after the word "change":
"; provided that if such new account shall not be in the same
jurisdiction having the same power to tax as the original account,
the party not changing its account shall not be obliged to pay any
greater amounts and shall not receive less as a result of such
change than would have been the case if such change had not taken
place."
(e) Additional Representations. Section 3 is hereby amended by adding the
following additional Subsections:
(i) No Agency. Party A is acting for its own account as principal
and the Securities Administrator is executing the Agreement on behalf of
the Trust as Party B and not for its own account in entering into the
Agreement and each Transaction (and otherwise not as agent or in any other
capacity, fiduciary or otherwise).
(ii) Eligible Contract Participant. (a) It is an "eligible contract
participant" as defined in the Commodity Exchange Act, as amended by the
Commodity Futures Modernization Act of 2000, (b) the Agreement and each
Transaction is subject to individual negotiation by each Party and (c)
neither the Agreement nor any Transaction will be executed or traded on a
"trading facility" within the meaning of Section la(33) of the Commodity
Exchange Act, as amended.
(iii) Line of Business. It has entered into the Agreement (including
each Transaction evidenced hereby) in conjunction with its line of
business (including financial intermediation services) or the financing of
its business.
(iv) No Reliance. In connection with the negotiation of, the
entering into, and the confirmation of the execution of, the Agreement and
each Transaction: (i) the other party is not acting as a fiduciary or
financial or investment advisor for it; (ii) it is not relying upon any
representations (whether written or oral) of the other party other than
the representations expressly set forth in the Agreement; and (iii) 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.
(v) Assessment and Understanding. It is capable of assessing the
merits of and understanding (on its own behalf or through independent
professional advice), and understands and accepts the terms, conditions
and risks of that Transaction. It is also capable of assuming, and
assumes, the risks of that Transaction.
(vi) Status of Parties. The other party is not acting as a fiduciary
for or an adviser to it in respect of that Transaction.
(f) Limited Recourse. Notwithstanding anything to the contrary contained
herein (including, without limitation, any calculations made in accordance with
Section 6 of the Agreement), the liability of Party B in relation to the
Agreement and any Confirmation hereunder is limited in recourse to the portion
of the assets of Party B and proceeds thereof payable to Party A thereunder
applied in accordance with the priority of payments described in the Pooling and
Servicing Agreement and, on exhaustion thereof, all claims against Party B
arising from this Agreement or contemplated hereby shall be extinguished. The
provisions of this Part 5(f) shall survive the termination of the Agreement for
any reason whatsoever.
(g) Non-petition. Party A agrees that it will not, prior to at least one
year and one day (or if longer, the applicable preference period then in effect)
following the payment in full of all the Certificates issued pursuant to the
Pooling and Servicing Agreement and the expiration of all applicable preference
periods under the laws of the United States or any other applicable
jurisdiction, if longer, relating to any such payment, acquiesce, petition or
otherwise invoke or cause Party B to invoke the process of any governmental
authority for the purpose of commencing or sustaining a case (whether voluntary
or involuntary) against Party B under any bankruptcy, insolvency or similar law
or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of Party B or any substantial part of its property or
ordering the winding-up or liquidation of the affairs of Party B; provided that
this provision shall not restrict or prohibit Party A from joining any other
person, including, without limitation, the Securities Administrator, in any
bankruptcy, reorganization, arrangement, insolvency, moratorium or liquidation
proceedings already commenced or other analogous proceedings already commenced
under applicable laws by such other person. The provisions of this Part 5(g)
shall survive the termination of the Agreement for any reason whatsoever.
(h) Notice of Amendments. Party B will deliver notice in writing to each
Rating Agency of any modification, amendment or waiver under Section 9(b) of the
Agreement. Party B will obtain, or cause to be obtained, prior written
confirmation from S&P and Fitch to the effect that any proposed amendment will
not result in a withdrawal, suspension or downgrade of such Rating Agency's
rating assigned to any Class of Certificates, and such obligation shall be that
of Party B only. Party B will provide to Party A a copy of each such prior
written confirmation promptly after receipt thereof from S&P and Fitch.
(i) Transfer. Section 7 is hereby deleted in its entirety and replaced by
the following:
Neither Party A nor Party B is permitted to assign, novate or
transfer (including pursuant to Section 6(b)(ii)), (whether by way
of security or otherwise) as a whole or in part, any of its rights,
obligations or interests under the Agreement without the prior
written consent of the other party and confirmation from S&P and
Fitch and prior written notice to Moody's; provided that Party A may
transfer its rights and obligations under the Agreement to any
Person, including, without limitation, another of Party A's offices,
branches or affiliates (each, a "Transferee") on ten (10) Business
Days' prior written notice to Party B, the Securities Administrator
and each Rating Agency; provided that, with respect to this Part
5(i), (i) as of the date of such transfer, neither the Transferee
nor Party B will be required to withhold or deduct on account of tax
under the Agreement, (ii) a Termination Event or Event of Default
does not occur under the Agreement as a result of such transfer,
(iii) the transfer will not give rise to a taxable event or any
adverse tax consequences to Party B or its interest holders, (iv)
the Transferee satisfies the Swap Counterparty Ratings Requirement
or the obligations transferred to the Transferee are guaranteed by a
party that satisfies the Swap Counterparty Ratings Requirement
pursuant to a guaranty substantially in a form meeting S&P's
then-current published criteria with respect to guarantees, (v) S&P
and Fitch have confirmed in writing that such transfer will not
result in a reduction, downgrade or withdrawal of its then-current
rating of each Class of Certificates and (vi) both Party A and the
Transferee are at the time of transfer "dealers in notional
principal contracts" within the meaning of United States Treasury
Regulation Section 1.1001-4.
(j) Collateralization Events. (i) The following shall constitute a
Collateralization Event in respect of the Agreement (each, a "Collateralization
Event"):
(A) Provided that no Substitution Event has occurred, Party A has
fallen below the First Trigger Required Ratings from Moody's, or
(B) Provided that no Substitution Event has occurred (i) the short
term rating from S&P of Party A or its Credit Support Provider is
withdrawn, suspended or falls below "A-1" or (ii) the long term rating
from S&P of Party A or its Credit Support Provider is withdrawn, suspended
or falls below "A+", if Party A or its Credit Support Provider does not
have a short term rating from S&P, or
(C) Provided that no Substitution Event has occurred, the short-term
issuer credit rating of Party A's Credit Support Provider from Fitch falls
below "F1" or the long-term senior unsecured debt rating of Party A's
Credit Support Provider from Fitch falls below "A" (the ratings described
in clause (A), (B) and (C), the "Swap Counterparty Ratings Requirements").
(ii) If a Collateralization Event occurs, Party A shall, solely at
the expense of Party A, within 30 days of the occurrence of such
Collateralization Event, either (A) with respect to a Collateralization
Event under Part 5 (j)(i)(A) above, comply with the First Rating Trigger
Requirements, and (B) with respect to any Collateralization Event under
Part 5 (j)(i)(B) or (C) above, either (I) enter into a Credit Support
Annex and, pursuant to such Credit Support Annex, deliver to the
Securities Administrator collateral of such types, in such amounts subject
to Rating Agency Confirmation by each Rating Agency for which a
Collateralization Event under Part 5(j)(i)(B) or (C) above has occurred
and is continuing, (II) find a replacement counterparty as permitted
hereunder that satisfies the Swap Counterparty Ratings Requirement
(subject to Part 5 (j)(iii)), (III) obtain a guarantor which absolutely
and unconditionally guarantees (with such form of guarantee meeting S&P's
then-current published criteria, as confirmed in writing by S&P, with
respect to guarantees) for the obligations of the Swap Counterparty under
this Agreement, that satisfies the Swap Counterparty Ratings Requirement
or (IV) take such other steps such that each Rating Agency that has
downgraded Party A or its Credit Support Provider confirms that the then
current rating of the Certificates, by either S&P or Fitch, is not reduced
or withdrawn. If Party A has not, within 30 days of the occurrence of such
Collateralization Event taken any of the actions required above, an
Additional Termination Event shall have occurred with Party A as the sole
Affected Party. Party A shall bear all costs and expenses relating to
posting Eligible Collateral and performing its obligations under the
Credit Support Annex.
(iii) At any time following a Collateralization Event, if Party A
elects, upon 10 days' prior written notice to Party B, Party A may assign
its rights and obligations hereunder to a counterparty (the "New
Counterparty") that satisfies the Swap Counterparty Ratings Requirement
and with respect to which Rating Agency Confirmation has been received,
pursuant to an agreement at the sole expense of Party A; provided that (A)
as of the date of such assignment, the counterparty will not, as a result
of such assignment, be required to withhold or deduct on account of tax
under the Agreement, (B) a Termination Event or Event of Default does not
occur under the Agreement as a result of such assignment and (C) prior
written notice has been provided to Moody's and S&P and Fitch have
confirmed in writing that such assignment will not result in a reduction,
downgrade or withdrawal of its then-current rating the Certificates. Upon
successful consummation of any such assignment, Party A's obligations to
post collateral as contemplated above shall terminate and Party B shall
release its security interest in, and return to Party A, any then-posted
collateral.
"Rating Agency Confirmation" shall mean prior written confirmation from
S&P and Fitch, as applicable, that after giving effect to such proposed action
its then-current ratings of the Certificates will not be downgraded or
withdrawn.
(k) Substitution Events. (i) The following shall constitute a Substitution
Event in respect of this Agreement (each a "Substitution Event"):
(A) So long as any of the Certificates are Outstanding and rated by
S&P, the long term rating from S&P of Party A or its guarantor is
withdrawn, suspended or downgraded below "BBB-" or, if no long term rating
is available, the short term rating from S&P of Party A or its guarantor
is withdrawn, suspended or downgraded below "A-3"; or
(B) Party A has fallen below the Second Trigger Required Ratings; or
(C) The short-term issuer credit rating of Party A's Credit Support
Provider from Fitch is withdrawn, suspended or falls below "F2" or the
long-term senior unsecured debt rating of Party A's Credit Support
Provider from Fitch is withdrawn, suspended or falls below "BBB-".
(ii) If a Substitution Event occurs, Party A shall, (A) with respect
to a Substitution Event under Part 5(k)(i)(B) above, comply with the
Second Rating Trigger Requirements within 30 Local Business Days, and (B)
with respect to any Substitution Event under Part 5(k)(i)(A) or (C) above,
continue its obligation, if applicable, to post collateral pursuant to
Part 5(j) above and within 10 days following such Substitution Event
assign its rights and obligations under all Transactions at no cost to
Party B to a party (the "Substitute Party") selected by Party A who meets
the Swap Counterparty Ratings Requirements and with respect to which each
Rating Agency has confirmed in writing that its then-current ratings on
any Certificates rated by such Rating Agency will not be adversely
affected; provided that such right shall be subject to the assumption by
the Substitute Party of all of Party A's obligations hereunder pursuant to
an agreement satisfactory to Party B, and subject to the payment to Party
A by the Substitute Party or by Party A to the Substitute Party (as
applicable) of the Substitution Assignment Amount (as defined below) or
such lesser or greater amount as Party A and such Substitute Party may
agree, which in either case shall be the only amount payable by or to
Party A in connection with such assignment. Upon successful consummation
of the assignment to a Substitute Party as contemplated in this Part 5(k),
Party A's obligations to post collateral as contemplated in Part 5(j)
shall terminate and Party B shall release its security interest in, and
return to Party A, any then-posted collateral.
The "Substitution Assignment Amount" shall be calculated in
accordance with the Market Quotation method as if the date of determination were
an Early Termination Date for which all Transactions were Affected Transactions
and Party A were the sole Affected Party; provided, however, that for purposes
of this Part 5(k), Market Quotation shall mean, in the event that fewer than
three quotations are provided, the average of the quotations provided.
"Eligible Guarantee" means an unconditional and irrevocable
guarantee that is provided by a guarantor as principal debtor rather than surety
and is directly enforceable by Party B, where either (A) a law firm has given a
legal opinion confirming that none of the guarantor's payments to Party B under
such guarantee will be subject to withholding for tax or (B) such guarantee
provides that, in the event that any of such guarantor's payments to Party B are
subject to withholding for tax, such guarantor is required to pay such
additional amount as is necessary to ensure that the net amount actually
received by Party B (free and clear of any withholding tax) will equal the full
amount Party B would have received had no such withholding been required.
"Eligible Replacement" means an entity (A) with the First Trigger
Required Ratings and/or the Second Trigger Required Ratings or (B) whose present
and future obligations owing to Party B are guaranteed pursuant to an Eligible
Guarantee provided by a guarantor with the First Trigger Required Ratings and/or
the Second Trigger Required Ratings.
"Firm Offer" means an offer which, when made, was capable of
becoming legally binding upon acceptance.
"First Rating Trigger Requirements" means, so long as no Relevant
Entity has the First Trigger Required Ratings, that Party A will within 30 days,
(i) post collateral pursuant to the terms of the Credit Support Annex hereto,
(ii) obtain an Eligible Guarantee in respect of all of Party A's present and
future obligations under this Agreement or (iii) locate an Eligible Replacement
that (a) is reasonably acceptable to Party B (which shall be evidenced by Party
B's receipt of Rating Agencies confirmation) and satisfies the First Trigger
Required Ratings and (b) who assumes the obligations of Party A under this
Agreement (through an assignment and assumption agreement in form and substance
reasonably satisfactory to Party B) or replaces the outstanding Transactions
hereunder with transactions on identical terms, except that Party A shall be
replaced as counterparty, provided that such Eligible Replacement, as of the
date of such assumption or replacement, will not, as a result thereof, be
required to withhold or deduct on account of tax under the Agreement or the new
transactions, as applicable, and such assumption or replacement will not lead to
a Termination Event or Event of Default occurring under the Agreement or new
transactions, as applicable.
"First Trigger Required Ratings" means (A) where such entity is the
subject of a Moody's Short-term Rating, if such rating is "Prime-1" and its
long-term, unsecured and unsubordinated debt obligations are rated "A2" or above
by Moody's and (B) where such entity is not the subject of a Moody's Short-term
Rating, if its long-term, unsecured and unsubordinated debt obligations are
rated "A1" or above by Moody's.
"Moody's Short-term Rating" means a rating assigned by Moody's under
its short-term rating scale in respect of an entity's short-term, unsecured and
unsubordinated debt obligations.
"Relevant Entities" means Party A and any guarantor under an
Eligible Guarantee in respect of all of Party A's present and future obligations
under this Agreement.
"Second Rating Trigger Requirements" means, so long as no Relevant
Entity has the Second Trigger Required Ratings, that Party A will at its own
cost use commercially reasonable efforts to, as soon as reasonably practicable,
procure either (A) an Eligible Guarantee in respect of all of Party A's present
and future obligations under this Agreement to be provided by a guarantor with
the First Trigger Required Ratings and/or the Second Trigger Required Ratings or
(B) at least one Eligible Replacement has made a Firm Offer (which remains
capable of becoming legally binding upon acceptance).
"Second Trigger Required Ratings" means (A) where such entity is the
subject of a Moody's Short-term Rating, if such rating is "Prime-2" or above and
its long-term, unsecured and unsubordinated debt obligations are rated "A3" or
above by Moody's and (B) where such entity is not the subject of a Moody's
Short-term Rating, if its long-term, unsecured and unsubordinated debt
obligations are rated "A3" or above by Moody's.
(l) Interpretation. References in the Agreement to the parties hereto,
Party A and Party B, shall (for the avoidance of doubt) include, where
appropriate, any permitted successors or assigns thereof.
(m) Section 14 Definitions. The definition of "law" in Section 14 is
hereby amended by the insertion of the words "either generally or with respect
to a party to the Agreement" after the phrase "any relevant governmental revenue
authority" and the addition of the words "Change in Tax Law", before the word
"lawful" in the second line.
(n) (i) Notwithstanding the definition of "Indemnifiable Tax" in Section
14 of this Agreement, in relation to payments by Party A, any Tax shall be an
Indemnifiable Tax and, in relation to payments by Party B, no Tax shall be an
Indemnifiable Tax.
(ii) Section 2(d)(i)(4) of this Agreement shall be deleted in its
entirety and replaced with the words "if such Tax is an Indemnifiable Tax,
pay to Y, in addition to the payment which Y is otherwise entitled under
this Agreement, such additional amount as is necessary to ensure that the
net amount actually received by Y (free and clear of Indemnifiable Taxes,
whether against X or Y) will equal the full amount Y would have received
had no such deduction or withholding been required".
(o) Recorded Conversations. Each party to the Agreement acknowledges and
agrees that the other may electronically record all telephonic conversations
between them in connection with the Agreement or any Transaction or any other
transaction between the parties and, to the extent admissible, any such
recordings may be submitted in evidence to any court or in any proceeding for
the purpose of establishing any matters pertinent to the Agreement or any such
Transaction or transactions.
(p) Limitation of Liability. No party shall be required to pay or be
liable to the other party for any consequential, indirect or punitive damages,
opportunity costs or lost profits (whether or not arising from negligence).
(q) Applicable Transaction. This Agreement will apply to the interest rate
swap and the interest rate cap Transactions entered into between Party A and
Party B confirmed by the Confirmations dated April 30, 2007 (the "Interest Rate
Swap"), and that any subsequent transaction shall be governed by its own ISDA
Master Agreement unless otherwise agreed. The parties hereto acknowledge that
this Agreement will terminate on the date of expiration of the Transactions.
(r) Set-off. Notwithstanding any provision of this Agreement, except as
specifically provided for in Section 2(c) and, other than in connection with the
calculation of the Defaulted Swap Termination Payment and as specifically
provided for in Part 1(o)(iii)(9), Section 6(e) of this Agreement, each party
irrevocably waives any and all rights it may have to set off (including any
Set-off as referenced in the last sentence of the first paragraph of Section
6(e)), 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.
(s) Securities Administrator Capacity. It is expressly understood and
agreed by the parties hereto that insofar as this Agreement is executed by Xxxxx
Fargo Bank, National Association (i) this Agreement is executed and delivered by
Xxxxx Fargo Bank, National Association not in its individual capacity but solely
as Securities Administrator under the Pooling and Servicing Agreement in the
exercise of the powers and authority conferred and invested in it as securities
administrator thereunder, (ii) each of the representations, undertakings and
agreements herein made on behalf of the Trust is made and intended not as
personal representations of the Securities Administrator but is made and
intended for the purpose of binding only the Trust, (iii) under no circumstances
shall Xxxxx Fargo Bank, National Association in its individual capacity be
personally liable for the payment of any indebtedness or expenses or be
personally liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken under this Agreement, and (iv) all
Persons having any claim against the Securities Administrator by reason of this
Agreement or the transaction contemplated hereby shall look solely to the assets
of the Trust for payment satisfaction thereof. Notwithstanding anything to the
contrary herein, nothing shall relieve the Securities Administrator of its
obligation to perform its duties under Section 2.01 of the Pooling and Servicing
Agreement in accordance with Section 8.14 and Section 8.15 of the Pooling and
Servicing Agreement.
(t) Compliance with Regulation AB.
(A) If at any time, in the reasonable determination made in good
faith of the Sponsor (as defined in the Prospectus Supplement), the
aggregate "significance percentage" (as defined in Regulation AB
("Regulation AB") under the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) of all
derivative instruments (contemplated by Item 1115 of Regulation AB)
provided by Party A and any of its affiliates to the Issuing Entity (as
defined in the Prospectus Supplement) is at least 10% but less than 20%,
Party A shall, subject to subparagraph (C) below, within five (5) Business
Days following request therefor demonstrate to the satisfaction of the
Sponsor and the Depositor that it is able to provide the financial
information required under Item 1115(b)(1) of Regulation AB for Party A
(and for the group of affiliated entities, if applicable) (the "Item
1115(b)(1) Information"). Any such Item 1115(b)(1) Information shall be in
a form suitable for conversion to the format required for filing by the
Depositor with the Securities and Exchange Commission via the Electronic
Data Gathering and Retrieval System (XXXXX).
(B) If at any time, in the reasonable determination made in good
faith of the Sponsor, the aggregate "significance percentage" of all
derivative instruments (contemplated by Item 1115 of Regulation AB)
provided by Party A and any of its affiliates to the Issuing Entity (as
defined in the Prospectus Supplement) is at least 20%, Party A shall,
subject to subparagraph (C) below, within five (5) Business Days following
request therefor demonstrate to the satisfaction of the Sponsor and the
Depositor that it is able to provide the financial information required
under Item 1115(b)(2) of Regulation AB for Party A (and for the group of
affiliated entities, if applicable) (the "Item 1115(b)(2) Information",
and together with the Item 1115(b)(1) Information, the "Additional
Information"). Any such Item 1115(b)(2) Information shall be in a form
suitable for conversion to the format required for filing by the Depositor
with the Securities and Exchange Commission via the Electronic Data
Gathering and Retrieval System (XXXXX). In addition, any such Item
1115(b)(2) Information shall be accompanied by any necessary auditor's
consents.
(C) If Party A is unable to satisfy the Sponsor and the Depositor as
to its ability to provide any such Additional Information if, as and when
required, Party A shall, at its option and sole expense, within ten (10)
Business Days following request therefor, (1) promptly post collateral
satisfactory to the Sponsor in an amount which is reasonably determined in
good faith to be sufficient to reduce the aggregate "significance
percentage" to (x) in the case of subparagraph (A) above, below 10%, and
(y) in the case of subparagraph (B) above, provided Party A is able to
meet the requirements of subparagraph (A) above, below 20%, in each case
pursuant to a Credit Support Annex or similar agreement reasonably
satisfactory to the Sponsor, or (2) without any expense or liability to
the Sponsor, the Depositor, Party B or the Issuing Entity, assign its
rights and delegate its obligations under the Agreement to a substitute
counterparty reasonably acceptable to the Sponsor and the Depositor that
(w) is able to provide such Additional Information if, as and when
required, (x) whose assignment is subject to prior notice to Moody's, and
written confirmation from S&P and Fitch that such transfer will not result
in a reduction, downgrade or withdrawal of its then-current rating of each
Class of Certificates, (y) meets the Swap Counterparty Ratings
Requirements, and (z) enters into an agreement similar in form to this
Agreement pursuant to which such substitute counterparty agrees to provide
the Additional Information if, as and when required.
(D) Party A's obligation to provide any such Additional Information
shall terminate beginning in any such year in which the Issuing Entity's
obligation to file periodic reports under the Exchange Act has terminated.
[Signature Page Follows]
IN WITNESS WHEREOF, the parties have executed this document on the
respective dates specified below with effect from the date specified on the
first page of this document.
NATIXIS FINANCIAL PRODUCTS INC.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
-------------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Title: Managing Director
NATIXIS REAL ESTATE CAPITAL SUPPLEMENTAL
INTEREST TRUST 2007-HE2
By: Xxxxx Fargo Bank, National
Association, not in its individual
capacity but solely as Securities
Administrator
By: /s/ Xxxxxx Xxxx
-------------------------------------
Name: Xxxxxx Xxxx
Title: Vice President
ISDA(R)
International Swaps and Derivatives Association, Inc.
CREDIT SUPPORT ANNEX
to the Schedule to the
Master Agreement
dated as of April 30, 2007
between
NATIXIS FINANCIAL NATIXIS REAL ESTATE CAPITAL
PRODUCTS INC. SUPPLEMENTAL INTEREST
TRUST 2007-HE2
("Party A") ("Party B")
This Annex supplements, forms part of, and is subject to, the above-referenced
Agreement, is part of its Schedule and is a Credit Support Document under this
Agreement with respect to each party.
Accordingly, the parties agree as follows:
Paragraph 1. Interpretation
(a) Definitions and Inconsistency. Capitalized terms not otherwise defined
herein or elsewhere in this Agreement have the meanings specified pursuant to
Paragraph 12, and all references in this Annex to Paragraphs are to Paragraphs
of this Annex. In the event of any inconsistency between this Annex and the
other provisions of this Schedule, this Annex will prevail and in the event of
any inconsistency between Paragraph 13 and the other provisions of this Annex,
Paragraph 13 will prevail.
(b) Secured Party and Pledgor. All references in this Annex to the "Secured
Party" will be to either party when acting in that capacity and all
corresponding references to the "Pledgor" will be to the other party when acting
in that capacity; provided, however, that if Other Posted Support is held by a
party to this Annex, all references herein to that party as the Secured Party
with respect to that Other Posted Support will be to that party as the
beneficiary thereof and will not subject that support or that party as the
beneficiary thereof to provisions of law generally relating to security
interests and secured parties.
Paragraph 2. Security Interest
Each party, as the Pledgor, hereby pledges to the other party, as the Secured
Party, as security for its Obligations, and grants to the Secured Party a first
priority continuing security interest in, lien on and right of Set-off against
all Posted Collateral Transferred to or received by the Secured Party hereunder.
Upon the Transfer by the Secured Party to the Pledgor of Posted Collateral, the
security interest and lien granted hereunder on that Posted Collateral will be
released immediately and, to the extent possible, without further action by
either party.
CREDIT SUPPORT ANNEX
Elections and Variables
Dated as of April 30, 2007
between Natixis Financial Products Inc. ("Party A")
and Natixis Real Estate Capital Supplemental Interest Trust 2007--HE2
("Party B")
Paragraph 13. Elections and Variables
(a) Security Interest for "Obligations". The term "Obligations" as used in
this Annex includes no additional obligations with respect to Party A and
Party B.
(b) Credit Support Obligations.
(i) Delivery Amount, Return Amount and Credit Support Amount.
(A) "Delivery Amount" has the meaning specified in Paragraph 3(a)
except that the words "upon a demand made by the Secured Party
on or promptly following a Valuation Date" shall be deleted
and replaced by the words "on each Valuation Date".
(B) "Return Amount" has the meaning specified in Paragraph 3(b).
(C) "Credit Support Amount" has the meaning specified under the
relevant definition of Ratings Criteria. In circumstances
where more than one of the Ratings Criteria apply, the Credit
Support Amount shall be calculated by reference to the Ratings
Criteria which would result in Party A transferring the
greatest amount of Eligible Credit Support.
(ii) Eligible Collateral. The following items will qualify as "Eligible
Collateral" for each of the parties:
Valuation
Collateral Type Percentage
------------------------------------------------------------- ------------
(A) Cash, in the form of U.S. Dollars 100%
(B) Negotiable Debt Obligations issued by the U.S. 98%
Treasury Department having an original maturity
at issuance of not more than one year ("Treasury
Bills")
(C) Negotiable Debt Obligations issued by the U.S. 96%
Treasury Department having an original maturity at
issuance of more than one year, but not more than 5
years ("Treasury Notes")
(D) Negotiable Debt Obligations issued by the U.S. 94%
Treasury Department having an original maturity at
issuance of more than 5 years ("Treasury Bonds")
(iii) Other Eligible Support. There shall be none for the purposes of this
Annex.
(iv) Thresholds.
(A) "Independent Amount" means US$0 (zero), unless otherwise
specified in a Confirmation.
(B) "Threshold" means with respect to Party A: infinity, Provided
that for so long as no Relevant Entity has the First Trigger
Required Ratings and either (i) no Relevant Entity has had the
First Trigger Required Ratings since this Annex was executed
or (ii) at least 30 Local Business days have elapsed since the
last time a Relevant Entity had the First Trigger Required
Ratings, the Threshold with respect to Party A shall be zero.
(C) "Minimum Transfer Amount" means US$100,000 with respect to
Party A and US$100,000 with respect to Party B, provided,
however, that the Minimum Transfer Amount with respect to any
party shall be zero on any date on which the Threshold with
respect to such party is zero.
(D) "Rounding" The Delivery Amount and the Return Amount will be
rounded up and down to the nearest integral multiple of
US$10,000, respectively.
(v) "Exposure" has the meaning specified in Paragraph 12, except that
after the word "Agreement" the words "(assuming, for this purpose
only, that Part 1(o)(iii) of the Schedule is deleted)" shall be
inserted.
(c) Valuation and Timing.
(i) "Valuation Agent" means Party A.
(ii) "Valuation Date" means any Local Business Day.
(iii) "Valuation Time" means the close of business on the Local Business
Day before the Valuation Date or date of Calculation, as applicable;
provided that the calculations of Value and Exposure will be made as
of approximately the same time and the same day.
(iv) "Notification Time" means 10:00 AM New York time on the Local
Business Day following the Valuation Date.
(d) Conditions Precedent and Secured Party's Rights and Remedies. The
following Termination Event(s) will be a "Specified Condition" for the
party specified (that party being the Affected Party if the Termination
Event occurs with respect to that party):
Termination Event Party A Party B
----------------------------------- ------------ -----------
Illegality Yes Yes
Tax Event Yes Yes
Tax Event Upon Merger Yes Yes
Credit Event Upon Merger Yes Yes
Additional Termination Event(s) Yes Yes
(e) Substitution.
(i) "Substitution Date" has the meaning specified in Paragraph 4(d)(ii).
(ii) Consent. If specified here as applicable, then the Pledgor must
obtain the Secured Party's consent for any substitution pursuant to
Paragraph 4(d): Not Applicable.
(f) Dispute Resolution.
(i) "Resolution Time" means 1:00 PM New York time on the Local Business
Day following the date on which notice of the dispute is given.
(ii) Value. For the purpose of Paragraphs 5(i) and 5(ii), the Value of
Posted Credit Support will be calculated as follows: The Valuation
Agent will recalculate the Value of Posted Credit Support as of the
date of Transfer by using actual bid quotes from five leading market
makers and taking the arithmetic average of those obtained.
(A) with respect to any Eligible Credit Support or Equivalent
Credit Support comprising securities ("Securities") the Base
Currency Equivalent of the sum of (a)(x) the last bid price on
such date for such Securities on the principal national
securities exchange on which such Securities are listed,
multiplied by the applicable Valuation Percentage; or (y)
where any Securities are not listed on a national securities
exchange, the bid price for such Securities quoted as at the
close of business on such date by any principal market maker
(which shall not be and shall be independent from the
Valuation Agent) for such Securities chosen by the Valuation
Agent, multiplied by the applicable Valuation Percentage; or
(z) if no such bid price is listed or quoted for such date,
the last bid price listed or quoted (as the case may be), as
of the day next preceding such date on which such prices were
available, multiplied by the applicable Valuation Percentage;
plus (b) the accrued interest where applicable on such
Securities (except to the extent that such interest shall have
been paid to the Pledgor pursuant to Paragraph 5(c)(ii) or
included in the applicable price referred to in subparagraph
(a) above) as of such date; and
(B) with respect to any Cash, the Base Currency Equivalent of the
amount thereof.
(iii) Alternative. The provisions of Paragraph 5 will apply, except to the
following extent: Pending the resolution of a dispute, Transfer of
the undisputed Value of Eligible Credit Support or Posted Credit
Support involved in the relevant demand will be due as provided in
Paragraph 5 if the demand is given by the Notification Time but will
be due on the second Local Business Day after the demand if the
demand is given after the Notification Time.
(g) Holding and Using Posted Collateral.
(i) Eligibility to Hold Posted Collateral; Custodians. Party B and its
Custodian will be entitled to hold Posted Collateral pursuant to
Paragraph 6(b); provided that the following conditions applicable to
it are satisfied:
(1) Party B is not a Defaulting Party; and
(2) Party B or its Custodian (as the case may be) has a net worth
of at least US$50,000,000.
Initially, the Custodian for Cash and Securities for Party B is:
Deutsche Bank National Trust Company, or any successor trustee under the Pooling
and Servicing Agreement.
(ii) Use of Posted Collateral. The provisions of Paragraph 6(c) will not
apply to a Secured Party.
(h) Distributions and Interest Amount.
(i) Interest Rate. The "Interest Rate" will be the rate per annum equal
to the overnight Federal Funds Rate for each day cash is held by the
Secured Party as reported in Federal Reserve Publication H.15-519.
(ii) Transfer of Interest Amount. The transfer of the Interest Amount
will be made on or within 5 Local Business Days after the last Local
Business Day of each calendar month and on any other Local Business
Day as agreed by the parties.
(iii) Alternative to Interest Amount. The provisions of Paragraph 6(d)(ii)
will not apply.
(i) Additional Representation(s): Not Applicable.
(j) Other Eligible Support and Other Posted Support.
(i) "Value" with respect to Other Eligible Support and Other Posted
Support means, not applicable.
(ii) "Transfer" with respect to Other Eligible Support and Other Posted
Support means, not applicable.
(k) Demands and Notices. All demands, specifications and notices under this
Annex will be made pursuant to the Notices Section of the Agreement.
(l) Addresses for Transfers.
Party A: Securities: Bank of New York (ABA000000000)/NATIXIS FP
Cash: Bank of New York/NATIXISFP/ABA000000000 GLA#
111569 CDF
Party B: Securities: To be specified in each notice.
Cash: Xxxxx Fargo Bank, N.A.
ABA No.: 000000000
Account No.: 0000000000
Account Name: Corporate Trust Clearing
FFC: 53140904, NATIXIS 2007-HE2
Attention: Client Services Manager
(m) Other Provisions.
(i) A new section (iii) to Paragraph 6(d) will be added to read as
follows:
"(iii) Any Distributions with respect to Posted Collateral other
than Cash and any distributions with respect to Posted Collateral in
the form of Cash retained by the Secured Party prior to any
Valuation Date will constitute Posted Collateral."
(ii) Secured Party and Pledgor. Notwithstanding anything contained in
this Annex to the contrary, (i) all references in this Annex to the
"Secured Party" and all references to "other party" in Paragraphs 2,
9 and 11(b) of this Annex, will be to Party B exclusively, and (iii)
all references in this Annex to the "Pledgor" and all references to
"Each party" or "a party" in Paragraphs 2, 9 and 11(b) of this
Annex, will be to Party A exclusively.
(iii) Securities Administrator Capacity. It is expressly understood and
agreed by the parties hereto that insofar as this Agreement is
executed by Xxxxx Fargo Bank, National Association (i) this
Agreement is executed and delivered by Xxxxx Fargo Bank, National
Association not in its individual capacity but solely as Securities
Administrator under the Pooling and Servicing Agreement in the
exercise of the powers and authority conferred and invested in it as
securities administrator thereunder, (ii) each of the
representations, undertakings and agreements herein made on behalf
of the Trust is made and intended not as personal representations of
the Securities Administrator but is made and intended for the
purpose of binding only the Trust, (iii) under no circumstances
shall Xxxxx Fargo Bank, National Association in its individual
capacity be personally liable for the payment of any indebtedness or
expenses or be personally liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken
under this Agreement, and (iv) all Persons having any claim against
the Securities Administrator by reason of this Agreement or the
transaction contemplated hereby shall look solely to the assets of
the Trust for payment satisfaction thereof. Notwithstanding anything
to the contrary herein, nothing shall relieve the Securities
Administrator of its obligation to perform its duties under Section
2.01 of the Pooling and Servicing Agreement in accordance with
Section 8.14 and Section 8.15 of the Pooling and Servicing
Agreement.
(iv) Ratings Criteria
"Ratings Criteria" means, the criteria used by Moody's ("Moody's
Criteria") for the purposes of determining the amount of Eligible
Credit Support Party A is required to transfer at any time when the
Threshold with respect to Party A is zero.
Moody's Criteria
"Credit Support Amount" shall be calculated in accordance with the
meaning specified in Paragraph 3 provided however that the words
"plus the Additional Collateral Amount" shall be added after the
words "Secured Party's Exposure" in the second line thereof. For
such purposes "Additional Collateral Amount" means:
(v) for so long as (A) the Second Rating Trigger Requirements do not
apply or (B) less than 30 Local Business Days have elapsed since the
last time the Second Rating Trigger Requirements did not apply, the
greater of (x) zero, and (y) the Secured Party's Exposure for that
Valuation Date plus the lesser of (1) the product of 15 and the
"DV01" of all outstanding Transactions determined by the Valuation
Agent acting in a commercially reasonable manner and (2) 2% of the
Notional Amount; and
(vi) for so long as the Second Rating Trigger Requirements do apply and
30 or more Local Business Days have elapsed since the last time the
Second Rating Trigger Requirements did not apply, the greatest of
(x) zero, (y) Party A's net payment obligations due to Party B under
the Agreement on the Payment Date next following such Valuation
Date, and (z) the Secured Party's Exposure for that Valuation Date
plus the lesser of (1) the product of 50 and the "DV01" of all
outstanding Transactions determined by the Valuation Agent acting in
a commercially reasonable manner and (2) 8% of the Notional Amount.
"DV01" means the sum of the estimated change in the Exposure that
would result from a one (1) basis point shift in the relevant swap
curve, as determined by the Valuation Agent in good faith and in a
commercially reasonable manner in accordance with the relevant
customary methodology used by the Valuation Agent.
[Signature Page Follows]
IN WITNESS WHEREOF, the parties executing this Credit Support Annex
have executed the Master Agreement and have agreed as to the contents of this
Credit Support Annex.
NATIXIS FINANCIAL NATIXIS REAL ESTATE CAPITAL
PRODUCTS INC. SUPPLEMENTAL INTEREST TRUST
2007--HE2
(Party A) (Party B)
By: Xxxxx Fargo Bank, National
Association, not in its
individual capacity but solely
as Securities Administrator
/s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxxx Xxxx
-------------------------------------- ------------------------
Name: Xxxxxxx X. Xxxxxx Name: Xxxxxx Xxxx
Title: Managing Director Title: Vice President
/s/ Xxxxxxxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Title: Managing Director
Date: April 30, 2007
To: Natixis Real Estate Capital Supplemental Interest Trust 2007-HE2
By Xxxxx Fargo Bank, National Association, not in its individual
capacity but solely as Securities Administrator
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Services, Client Services Manager Natixis
Real Estate Capital Trust 2007-HE2
From: NATIXIS FINANCIAL PRODUCTS INC.
0 X. 00xx Xxxxxx
Xxx Xxxx, XX
Telephone: 000 000 0000/6194
Facsimile: 000 000 0000
--------------------------------------------------------------------------------
RE: SWAP TRANSACTION
The purpose of this letter (this "Confirmation") is to confirm the terms
and conditions of the Swap Transaction entered into between us on the Trade Date
specified below.
The definitions and provisions contained in the 2000 ISDA Definitions (the
"Definitions"), as published by the International Swaps and Derivatives
Association, Inc., ("ISDA") are incorporated into this Confirmation. Capitalized
terms used in this Confirmation have the respective meanings specified in this
Confirmation (or elsewhere in the Agreement, as defined below). In the event of
any inconsistency between those definitions and provisions and this
Confirmation, this Confirmation will govern. Capitalized terms used herein but
not otherwise defined in the Agreement or in this Confirmation shall have the
meaning ascribed thereto in the Pooling and Servicing Agreement, dated as of
April 1, 2007, among Xxxxxx Xxxxxxx ABS Capital I Inc., as Depositor, Xxxxx
Fargo Bank, National Association, as Master Servicer and as Securities
Administrator, Saxon Mortgage Services, Inc., as Servicer, Natixis Real Estate
Capital Inc., as Unaffiliated Seller and Deutsche Bank National Trust Company,
as Trustee and Custodian (as amended, modified or supplemented from time to
time, the "Pooling and Servicing Agreement").
This Confirmation constitutes a "Confirmation" as referred to in, and
supplements, forms part of and is subject to, the ISDA Master Agreement dated as
of April 30, 2007 (including the Schedule thereto), as amended and supplemented
from time to time (the "Agreement"), between Natixis Financial Products Inc.
("Party A") and Natixis Real Estate Capital Supplemental Interest Trust 2007-HE2
("Party B"). All provisions contained in the Agreement govern this Confirmation
except as expressly modified below.
1. The terms of the particular Swap Transaction to which this Confirmation
relates are as follows:
Party A: NATIXIS FINANCIAL PRODUCTS INC.
Party B: NATIXIS Real Estate Capital Supplemental Interest Trust 2007-HE2
GENERAL TERMS
The terms of the particular Swap Transaction to which this Confirmation relates
are as follows:
Our Ref: 423651CF
Notional Amount: With respect to any Calculation Period, the product of the
amount and the multiplier set forth for such period on
Schedule A attached hereto
Calculation Periods: As set forth in Schedule A attached hereto
Trade Date: April 11, 2007
Effective Date: February 25, 2008
Termination Date: February 25, 2013 subject to adjustment in accordance with
the Following Business Day Convention
Initial Premium Payment by Party B to Party
A: $334,000.00, to be paid on April 30, 2007.
FLOATING AMOUNTS
Floating Rate Payer: Party A
Floating Rate Payer Payment Date: The Business Day prior to the related Fixed Rate Payer
Payment Date, commencing March 24, 2008, continuing to and
including the Termination Date, subject to adjustment in
accordance with the Following Business Day Convention.
Floating Rate Option: LIBOR (as defined in the Pooling and Servicing Agreement).
Designated Maturity: 1 Month
Spread: Inapplicable
Floating Rate Day Count Fraction: Actual/360
Reset Dates: The first Business Day of each Calculation Period
Compounding: Inapplicable
Business Days: As defined in the Pooling and Servicing Agreement.
Business Days for Floating Rate Fixing: London
FIXED AMOUNTS
Fixed Rate Payer: Party B
Fixed Rate Payer Payment Date: The 25th day of each month, commencing March 25, 2008,
continuing to and including the Termination Date, subject to
adjustment in accordance with the Following Business Day
Convention.
Fixed Rate: 4.8700%
Fixed Rate Day Count Fraction: 30/360
Period End Date: No Adjustment
ACCOUNT DETAILS
Payment To Party A: CITIBANK N.A.
ABA 000-000-000
Account No. 00000000
A/C NATIXISFP
Payments To Party B: Xxxxx Fargo Bank, National Association
ABA No.: 000000000
Account No: 0000000000
Account Name: Corporate Trust Clearing
FFC: 53140904, NATIXIS 2007-HE2 Swap Account
Attention: Client Services Manager
Other: For the avoidance of doubt, for purposes of Section 2(c) of
the Agreement, any amounts payable by the Floating Rate
Payer on a Floating Rate Payer Payment Date, and by the
Fixed Rate Payer on the related Fixed Rate Payer Payment
Date, shall be netted even though such dates may be
different, and the party with the larger aggregate amount
shall make the net payment on the related party's applicable
Payment Date.
OFFICES
The Office of Party A for this Transaction is New York
The Office of Party B for this Transaction is New York
Securities Administrator Capacity. It is expressly understood and agreed
by the parties hereto that insofar as this Confirmation is executed by Xxxxx
Fargo Bank, National Association (i) this Confirmation is executed and delivered
by Xxxxx Fargo Bank, National Association, not in its individual capacity but
solely as Securities Administrator under the Pooling and Servicing Agreement in
the exercise of the powers and authority conferred and invested in it as
securities administrator thereunder, (ii) each of the representations,
undertakings and agreements herein made on behalf of the Trust is made and
intended not as personal representations of the Securities Administrator but is
made and intended for the purpose of binding only the Trust, (iii) under no
circumstances shall Xxxxx Fargo Bank, National Association in its individual
capacity be personally liable for the payment of any indebtedness or expenses or
be personally liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken under this Confirmation,
and (iv) all Persons having any claim against the Securities Administrator by
reason of this Agreement or the transaction contemplated hereby shall look
solely to the assets of the Trust for payment satisfaction thereof.
Notwithstanding anything to the contrary herein, nothing shall relieve the
Securities Administrator of its obligation to perform its duties under Section
2.01 of the Pooling and Servicing Agreement in accordance with Section 8.14 and
Section 8.15 of the Pooling and Servicing Agreement.
Please confirm that the foregoing correctly sets forth the terms of our
agreement with respect to the Transaction by signing in the space provided below
and sending a copy of the executed Confirmation by telecopier (212.891.0660) to
the Operations Department, Natixis Financial Products Inc., Attention: Swap
Operations. If we do not hear from you within three days of the date hereof, you
will be deemed to have consented to the terms set forth herein.
It has been a pleasure working with you on this transaction and we look
forward to working with you again in the future.
Sincerely,
NATIXIS FINANCIAL PRODUCTS INC.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Title: Managing Director
Confirmed as of the
date first above written:
NATIXIS REAL ESTATE CAPITAL SUPPLEMENTAL INTEREST TRUST 2007-HE2
By: Xxxxx Fargo Bank, National Association,
not in its individual capacity but solely as
Securities Administrator
By: /s/ Xxxxxx Xxxx
--------------------------------
Name: Xxxxxx Xxxx
Title: Vice President
------------------------------------------------------------------------------
SCHEDULE A
------------------------------------------------------------------------------
To a Confirmation between
NATIXIS FINANCIAL PRODUCTS INC.
(Party A)
and
NATIXIS REAL ESTATE CAPITAL SUPPLEMENTAL INTEREST TRUST 2007-HE2
(Party B)
From* To* USD Notional Amount Multiplier
----------------------- -------------------------- ---------------------- ----------
February 25, 2008 March 25, 2008 59,085,910.21 10
March 25, 2008 April 25, 2008 56,565,061.09 10
April 25, 2008 May 25, 2008 54,141,924.26 10
May 25, 2008 June 25, 2008 51,816,460.54 10
June 25, 2008 July 25, 2008 49,584,170.20 10
July 25, 2008 August 25, 2008 47,448,269.86 10
August 25, 2008 September 25, 2008 45,406,996.51 10
September 25, 2008 October 25, 2008 43,300,048.55 10
October 25, 2008 November 25, 2008 41,417,122.92 10
November 25, 2008 December 25, 2008 39,177,973.26 10
December 25, 2008 January 25, 2009 32,175,250.56 10
January 25, 2009 February 25, 2009 30,117,589.05 10
February 25, 2009 March 25, 2009 27,942,215.53 10
March 25, 2009 April 25, 2009 26,123,619.87 10
April 25, 2009 May 25, 2009 24,940,112.54 10
May 25, 2009 June 25, 2009 23,382,955.19 10
June 25, 2009 July 25, 2009 16,997,075.06 10
July 25, 2009 August 25, 2009 15,595,239.53 10
August 25, 2009 September 25, 2009 14,039,116.55 10
September 25, 2009 October 25, 2009 12,887,849.94 10
October 25, 2009 November 25, 2009 12,290,967.75 10
November 25, 2009 December 25, 2009 11,474,913.93 10
December 25, 2009 January 25, 2010 7,782,800.18 10
January 25, 2010 February 25, 2010 6,695,336.70 10
February 25, 2010 March 25, 2010 5,860,383.90 10
March 25, 2010 April 25, 2010 5,319,005.47 10
April 25, 2010 May 25, 2010 5,058,330.22 10
May 25, 2010 June 25, 2010 4,835,820.92 10
June 25, 2010 July 25, 2010 4,507,395.48 10
July 25, 2010 August 25, 2010 3,949,031.91 10
August 25, 2010 September 25, 2010 3,747,308.48 10
September 25, 2010 October 25, 2010 3,568,820.92 10
October 25, 2010 November 25, 2010 3,410,707.42 10
November 25, 2010 December 25, 2010 3,280,239.49 10
December 25, 2010 January 25, 2011 3,078,737.16 10
January 25, 2011 February 25, 2011 2,745,538.89 10
February 25, 2011 March 25, 2011 2,617,218.18 10
March 25, 2011 April 25, 2011 2,501,466.56 10
April 25, 2011 May 25, 2011 2,397,690.01 10
May 25, 2011 June 25, 2011 2,313,562.90 10
June 25, 2011 July 25, 2011 2,233,058.34 10
July 25, 2011 August 25, 2011 2,155,453.48 10
August 25, 2011 September 25, 2011 2,080,518.21 10
September 25, 2011 October 25, 2011 2,008,161.71 10
October 25, 2011 November 25, 2011 1,938,296.75 10
November 25, 2011 December 25, 2011 1,870,837.92 10
December 25, 2011 January 25, 2012 1,800,781.56 10
January 25, 2012 February 25, 2012 1,730,817.67 10
February 25, 2012 March 25, 2012 1,665,744.46 10
March 25, 2012 April 25, 2012 1,606,167.95 10
April 25, 2012 May 25, 2012 1,549,477.78 10
May 25, 2012 June 25, 2012 1,495,252.87 10
June 25, 2012 July 25, 2012 1,438,214.11 10
July 25, 2012 August 25, 2012 1,380,820.37 10
August 25, 2012 September 25, 2012 1,327,925.68 10
September 25, 2012 October 25, 2012 1,280,148.74 10
October 25, 2012 November 25, 2012 1,234,859.99 10
November 25, 2012 December 25, 2012 1,191,647.57 10
December 25, 2012 January 25, 2013 1,147,386.64 10
January 25, 2013 February 25, 2013 1,103,335.57 10
* With respect to Party A only, subject to Following Business Day Convention
EXHIBIT Y
INTEREST RATE CAP AGREEMENT
NATIXIS FINANCIAL PRODUCTS INC.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000 / Phone: (000) 000-0000 / 6194
DATE: April 30, 2007
TO: Natixis Real Estate Capital Supplemental Interest Trust
2007-HE2
FROM: Natixis Financial Products Inc.
RE: Interest Rate Cap Transaction
Dear Sir or Madam:
The purpose of this letter agreement (this "Confirmation") is to confirm
the terms and conditions of the Transaction entered into between us on the Trade
Date specified below (the "Transaction").
The definitions and provisions contained in the 2000 ISDA Definitions as
published by the International Swaps and Derivatives Association, Inc. are
incorporated into this Confirmation. Capitalized terms used in this Confirmation
have the respective meanings specified in this Confirmation (or elsewhere in the
Agreement, as defined below). In the event of any inconsistency between those
definitions and provisions and this Confirmation, this Confirmation will govern.
Capitalized terms used herein but not otherwise defined in the Agreement or in
this Confirmation shall have the meaning ascribed thereto in the Pooling and
Servicing Agreement, dated as of April 1, 2007, among Xxxxxx Xxxxxxx ABS Capital
I Inc., as Depositor, Xxxxx Fargo Bank, National Association, as Master Servicer
and as Securities Administrator, Saxon Mortgage Services, Inc., as Servicer,
Natixis Real Estate Capital Inc., as Unaffiliated Seller and Deutsche Bank
National Trust Company, as Trustee and Custodian (as amended, modified or
supplemented from time to time, the "Pooling and Servicing Agreement").
This Confirmation constitutes a "Confirmation" as referred to in, and
supplements, forms part of and is subject to, the ISDA Master Agreement dated as
of April 30, 2007, as amended and supplemented from time to time (the
"Agreement"), between Natixis Financial Products Inc. ("Party A") and Natixis
Real Estate Capital Supplemental Interest Trust 2007-HE2 ("Party B"). All
provisions contained in the Agreement govern this Confirmation except as
expressly modified below.
1. The Cap Transaction to which this Confirmation relates is a Rate Cap
Transaction, the terms of which are as follow:
General Terms
Our Ref: 423656CF
Calculation Periods: As set forth in Schedule A attached hereto
Trade Date: April 11, 2007
Effective Date: April 30, 2007
Termination Date: February 25, 2008, subject to adjustment in accordance with
the Following Business Day Convention
Notional Amount: See Amortization Schedule, Schedule A
Fixed Amounts:
Fixed Amount Payer: Party B
Fixed Amount: $7,000
Fixed Amount Payment Date: On or prior to April 30, 2007, subject to adjustment in
accordance with the Following Business Day Convention.
Floating Amounts:
Floating Rate Payer: Party A
Floating Rate: The greater of (a) 0% and (b) LIBOR minus the Strike Rate (as
set forth in Schedule A attached hereto).
Floating Rate Payer Period The 25th day of each month of each year, commencing on May
End Dates: 25, 2007 to and including the Termination Date, subject to
adjustment in accordance with the Following Business Day
Convention.
Floating Rate Payer Payment The related Floating Rate Payer Period End Date.
Dates:
Floating Rate Option: LIBOR (as defined in the Pooling and Servicing Agreement).
Designated Maturity: One (1) month
Spread: None
Floating Rate Day Actual/360
Count Fraction:
Reset Dates: The first Business Day of each Calculation Period.
Compounding: Inapplicable
Business Days: As defined in the Pooling and Servicing Agreement.
Procedural Terms:
Calculation Agent: Party B
Offices: The Office of Party A for this Transaction is New York.
The Office of Party B for this Transaction is New York.
Account Details:
2. Payments to Party A: CITIBANK N.A.
ABA# 000-000-000
Account No.: 00000000
A/C NATIXISFP
Payments to Party B: Xxxxx Fargo Bank, National Association
ABA No.: 000000000
Account No: 0000000000
Account Name: Corporate Trust Clearing
FFC: 53140904, NATIXIS 2007-HE2 Swap Account
Attention: Client Services Manager
Securities Administrator Capacity. It is expressly understood and agreed
by the parties hereto that insofar as this Confirmation is executed by Xxxxx
Fargo Bank, National Association (i) this Confirmation is executed and delivered
by Xxxxx Fargo Bank, National Association, not in its individual capacity but
solely as Securities Administrator under the Pooling and Servicing Agreement in
the exercise of the powers and authority conferred and invested in it as
securities administrator thereunder, (ii) each of the representations,
undertakings and agreements herein made on behalf of the Trust is made and
intended not as personal representations of the Securities Administrator but is
made and intended for the purpose of binding only the Trust, (iii) under no
circumstances shall Xxxxx Fargo Bank, National Association in its individual
capacity be personally liable for the payment of any indebtedness or expenses or
be personally liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken under this Confirmation,
and (iv) all Persons having any claim against the Securities Administrator by
reason of this Agreement or the transaction contemplated hereby shall look
solely to the assets of the Trust for payment satisfaction thereof.
Notwithstanding anything to the contrary herein, nothing shall relieve the
Securities Administrator of its obligation to perform its duties under Section
2.01 of the Pooling and Servicing Agreement in accordance with Section 8.14 and
Section 8.15 of the Pooling and Servicing Agreement.
Please confirm that the foregoing correctly sets forth the terms and
conditions of our agreement by executing this Confirmation and returning it
to us by facsimile to:
Natixis Financial Products Inc.
(000) 000-0000 (fax)
Attn: Swap Operations
NATIXIS FINANCIAL PRODUCTS INC.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------------
Authorized Signatory Xxxxxxx X. Xxxxxx
Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
-----------------------------------------
Authorized Signatory Xxxxxxxxxxx Xxxxxx
Managing Director
Accepted and confirmed as of the date first above written:
NATIXIS REAL ESTATE CAPITAL SUPPLEMENTAL INTEREST TRUST 2007-HE2
By: Xxxxx Fargo Bank, National Association,
not in its individual capacity but solely as Securities Administrator
By: /s/ Xxxxxx Xxxx
-----------------------------------------------
Name: Xxxxxx Xxxx
Title: Vice President
SCHEDULE A to the Confirmation dated as of April 30, 2007
Re: Reference Number 423656CF
Amortization Schedule, subject to adjustment in accordance with the Following
Business Day Convention
From and including* To but excluding* Notional Amount (USD) Multiplier Strike Rate (%)
---------------------- ------------------------ ------------------------- ------------ -----------------
April 30, 2007 May 25, 2007 72,063,994.52 10 7.20
May 25, 2007 June 25, 2007 74,641,098.39 10 7.20
June 25, 2007 July 25, 2007 77,111,488.69 10 7.20
July 25, 2007 August 25, 2007 79,477,937.61 10 7.20
August 25, 2007 September 25, 2007 76,240,504.91 10 7.20
September 25, 2007 October 25, 2007 73,117,006.95 10 7.20
October 25, 2007 November 25, 2007 70,106,611.90 10 7.20
November 25, 2007 December 25, 2007 67,202,391.22 10 7.20
December 25, 2007 January 25, 2008 64,400,194.94 10 7.20
January 25, 2008 February 25, 2008 61,696,048.83 10 7.20
* With respect to Party A only, subject to Following Business Day Convention
EXHIBIT Z
[Reserved]
EXHIBIT AA
[Reserved]
EXHIBIT BB
ACCREDITED AGREEMENTS
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated April 30, 2007
("Agreement"), among Natixis Real Estate Capital Inc. ("Assignor"), Xxxxxx
Xxxxxxx ABS Capital I Inc. ("Assignee") and Accredited Home Lenders, Inc. (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and
other valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Third Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of August 1, 2006, between the Assignor, as purchaser (the
"Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans and (c) other than as provided below
with respect to the enforcement of representations and warranties, none of the
obligations of the Assignor under the Purchase Agreement.
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 Purchase Agreement which are not the Mortgage Loans set forth on the
Mortgage Loan Schedule and are not the subject of this Agreement or (ii) the
rights of the Purchaser (a) under Subsection 9.04 of the Purchase Agreement or
(b) to any premium recapture (i.e., the excess, if any, of the purchase price
percentage over par) in connection with any repurchase pursuant to Subsections
9.03 and 9.05 of the Purchase Agreement or (iii) any right to require the
Company to repurchase a Mortgage Loan pursuant to Subsection 9.05(b) of the
Purchase Agreement unless the related Mortgagor is delinquent with respect to
such Mortgage Loan's first Monthly Payment after origination.
Recognition of the Company
2. 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 Purchase Agreement
(solely to the extent set forth herein) and this Agreement to Natixis Real
Estate Capital Trust 2007-HE2 (the "Trust") created pursuant to a Pooling and
Servicing Agreement, dated as of April 1, 2007 (the "Pooling Agreement"), among
the Assignee, the Assignor, Deutsche Bank National Trust Company, as trustee (in
such capacity, including its successors in interest and any successor trustees
under the Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National
Association, as securities administrator (in such capacity, including its
successors in interest and any successor securities administrators under the
Pooling Agreement, the "Securities Administrator"), master servicer (in such
capacity, including its successors in interest and any successor master
servicers under the Pooling Agreement, the "Master Servicer") and Saxon Mortgage
Services, Inc., as servicer (including its successors in interest and any
successor servicer under the Pooling Agreement, the "Servicer"). The Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the enforcement of the representations, warranties and covenants with
respect to the Mortgage Loans, (iii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) shall have all the rights and remedies available to the Assignor,
insofar as they relate to the Mortgage Loans, under the Purchase Agreement,
including, without limitation, the enforcement of the document delivery
requirements set forth in Section 6 of the Purchase Agreement, and shall be
entitled to enforce all of the obligations of the Company thereunder insofar as
they relate to the Mortgage Loans, and (iv) all references to the Purchaser
(insofar as they relate to the rights, title and interest and, with respect to
obligations of the Purchaser, only insofar as they relate to the enforcement of
the representations, warranties and covenants of the Company), the Custodian or
the Bailee under the Purchase Agreement insofar as they relate to the Mortgage
Loans, shall be deemed to refer to the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf).
Neither the Company nor the Assignor shall amend or agree to amend, modify,
waiver, or otherwise alter any of the terms or provisions of the Purchase
Agreement which amendment, modification, waiver or other alteration would in any
way affect the Mortgage Loans or the Company's performance under the Purchase
Agreement with respect to the Mortgage Loans without the prior written consent
of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust as of the date hereof that:
The Company is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation;
The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of
the Company's business and will not conflict with, or result in a breach
of, any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument
to which the Company is now a party or by which it is bound, or result in
the violation of any law, rule, regulation, order, judgment or decree to
which the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity
regardless of whether enforceability is considered in a proceeding in
equity or at law;
Except as has already been obtained, no consent, approval, order or
authorization of, or declaration, filing or registration with, any
governmental entity is required to be obtained or made by the Company in
connection with the execution, delivery or performance by the Company of
this Agreement; and
Except as disclosed in public filings with the Securities Exchange
Commission by the Company or its affiliates, there is no action, suit,
proceeding or investigation pending or threatened against the Company,
before any court, administrative agency or other tribunal, which would
draw into question the validity of this Agreement or the Purchase
Agreement, or which, either in any one instance or in the aggregate, would
result in any material adverse change in the ability of the Company to
perform its obligations under this Agreement or the Purchase Agreement,
and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that (i) the representations and warranties set forth in
Subsection 9.01 of the Purchase Agreement are true and correct as of the date
hereof as if such representations and warranties were made on the date hereof,
(ii) the information set forth in the Mortgage Loan Schedule, to the extent
provided by the Company, attached hereto as Exhibit A is true and correct as of
the date hereof, and (iii) the representations and warranties set forth on
Exhibit B attached hereto are true and correct as of the date or dates set forth
thereon.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) in connection with any breach of the representations and warranties made
by the Company set forth in Sections 3 and 4 hereof shall be as set forth in
Subsection 9.03 of the Purchase Agreement as if they were set forth herein
(including without limitation the repurchase and indemnity obligations set forth
therein); provided, however, that the Assignor specifically reserves and does
not assign to the Assignee hereunder any and all right, title and interest in
the Premium Percentage, if any, due in connection with the repurchase of a
Mortgage Loan pursuant to Subsections 9.03, 9.04 and 9.05, or any right to
require the Company to repurchase a Mortgage Loan pursuant to Subsection 9.05(b)
of the Purchase Agreement unless the related Mortgagor is delinquent with
respect to such Mortgage Loan's first Monthly Payment after origination.
Miscellaneous
6. The Assignor specifically reserves and does not assign to the
Assignee hereunder any and all right, title and interest in the Premium
Percentage, if any, due in connection with the repurchase of a Mortgage Loan
pursuant to Subsections 9.03, 9.04 and 9.05.
7. 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.
8. 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.
9. This Agreement shall inure to the benefit of (i) the successors
and assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf). Any entity into which Assignor, Assignee or Company may be merged or
consolidated shall, without the requirement for any further writing, be deemed
Assignor, Assignee or Company, respectively, hereunder.
10. Each of this Agreement and the Purchase Agreement shall survive
the conveyance of the Mortgage Loans and the assignment of the Purchase
Agreement (to the extent assigned hereunder) by Assignor to Assignee and by
Assignee to the Trust and nothing contained herein shall supersede or amend the
terms of the Purchase Agreement.
11. 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.
12. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
13. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
ACCREDITED HOME LENDERS, INC.
By: /s/ Xxxxxxx X. Xxxx
--------------------------------------
Name: Xxxxxxx X. Xxxx
Its: Associate General Counsel-Finance
AVP & Ass't Sec'y
NATIXIS REAL ESTATE CAPITAL INC.
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxx
Its: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
--------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/ Xxxxxxx Xxx
--------------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
EXHIBIT B
REPRESENTATIONS AND WARRANTIES AS TO THE MORTGAGE LOANS
The Company hereby represents and warrants as to each Mortgage Loan,
as of the date on which the Company transferred servicing of the Mortgage Loan
to the Assignee or its designee (the "Transfer Date"), unless otherwise set
forth below:
(a) [Reserved];
(b) Payments Current. Except as set forth on the Mortgage Loan
Schedule delivered to the Purchaser by the Company on the Transfer Date, no
payment required to be made up to the Transfer Date under the Mortgage Loan is
30 days or more delinquent;
(c) No Outstanding Charges. Except as set forth on the Mortgage Loan
Schedule delivered to the Purchaser by the Company on the Transfer Date, to the
Company's knowledge as of the Transfer Date there are no defaults in complying
with the terms of the Mortgage securing the Mortgage Loan, 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 an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. As of the closing date for the
Securitization Transaction (the "Securitization Closing Date"), except for (A)
payments in the nature of escrow payments and (B) interest accruing from the
date of the Mortgage Note or date of disbursement of the Mortgage Loan proceeds,
whichever is earlier to the day which precedes by one month the Due Date of the
first installment of principal and/or interest, including, without limitation,
taxes and insurance payments, the Company has not advanced funds, or induced,
solicited or knowingly received any advance of funds by a party other than the
Mortgagor, directly or indirectly, for the payment of any amount required under
the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination except by a written instrument which has been
recorded, if necessary to protect the interests of the Purchaser, and which has
been delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. No
Mortgagor has been released, in whole or in part, except in connection with an
assumption agreement, approved by the title insurer, to the extent required by
the policy, and which assumption agreement is part of the Mortgage File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) No Defenses. The Mortgage Loan is 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 either the
Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject to
any right of rescission, set-off, counterclaim or defense, including without
limitation the defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was funded;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement. If required by the National Flood Insurance Act
of 1968, as amended, each Mortgage Loan is covered by a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration in effect, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement. All individual insurance
policies contain a standard mortgagee clause naming the Company and its
successors and assigns as mortgagee, and all premiums thereon have been paid and
such policies may not be reduced, terminated or cancelled without 30 days' prior
written notice to the mortgagee. The Mortgage obligates the Mortgagor thereunder
to maintain the hazard insurance policy at the Mortgagor's cost and expense, and
on the Mortgagor's failure to do so, authorizes the holder of the Mortgage to
obtain and maintain such insurance at such Mortgagor's cost and expense, and to
seek reimbursement therefor from the Mortgagor. Where required by state law or
regulation, the Mortgagor has been given an opportunity to choose the carrier of
the required hazard insurance, provided the policy is not a "master" or
"blanket" hazard insurance policy covering a condominium, or any hazard
insurance policy covering the common facilities of a planned unit development.
The hazard insurance policy is the valid and binding obligation of the insurer,
is in full force and effect, and will be in full force and effect and inure to
the benefit of the Purchaser upon the consummation of the purchase transactions
contemplated by this Agreement. As of the Securitization Closing Date, the
Company has not engaged in, and has no knowledge of the Mortgagor's or any
servicer's having engaged in, any act or omission which would impair the
coverage of any such policy, the benefits of the endorsement provided for
herein, or the validity and binding effect of such policy, including, without
limitation, no unlawful fee, commission, kickback or other unlawful compensation
or value of any kind has been or will be received, retained or realized by any
attorney, firm or other person or entity, and no such unlawful items have been
received, retained or realized by the Company;
(g) Compliance with Applicable Laws. As of the Securitization
Closing Date, 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, predatory and abusive lending, equal
credit opportunity and disclosure laws applicable to the Mortgage Loan,
including, without limitation, any provisions relating to Prepayment Charges,
have been complied with, the consummation of the transactions contemplated
hereby will not involve the violation of any such laws or regulations, and the
Company shall maintain in its possession, available for the Purchaser's
inspection, and shall deliver to the Purchaser upon demand, evidence of
compliance with all such requirements. Notwithstanding the foregoing, the
Company shall not be responsible for a breach of a federal, state or local law,
other than those governing (i) the origination and (ii) servicing of the
Mortgage Loans by the Company during the interim servicing period, following the
Transfer Date;
(h) No Satisfaction of Mortgage. The Mortgage has not been
satisfied, canceled, subordinated (except to a senior mortgage in the case of a
Second Lien Loan) or rescinded, in whole or in part, and the Mortgaged Property
has not been released from the lien of the Mortgage, in whole or in part, nor
has any instrument been executed that would effect any such 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;
(i) Location and Type of Mortgaged Property. The Mortgaged Property
is a fee simple property located in the state identified in the related Mortgage
Loan Schedule, except that with respect to real property located in
jurisdictions in which the use of leasehold estates for residential properties
is a widely-accepted practice, the Mortgaged Property may be a leasehold estate,
and consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a condominium project, or an individual unit in
a planned unit development; provided, however, that no residence or dwelling is
a mobile home and any condominium unit or planned unit development shall not
fall within any of the "Ineligible Projects" of part XII, Section 102 of the
Xxxxxx Mae Selling Guide and shall conform with the Underwriting Guidelines. In
the case of any Mortgaged Properties that are manufactured homes (a
"Manufactured Home Mortgage Loans"), (i) such Manufactured Home Mortgage Loan
conforms with the applicable Xxxxxx Xxx or Xxxxxxx Mac requirements regarding
mortgage loans related to manufactured dwellings, (ii) the related manufactured
dwelling is permanently affixed to the land, (iii) the related manufactured
dwelling and the related land are subject to a Mortgage properly filed in the
appropriate public recording office and naming Company as mortgagee, (iv) the
applicable laws of the jurisdiction in which the related Mortgaged Property is
located will deem the manufactured dwelling located on such Mortgaged Property
to be a part of the real property on which such dwelling is located, and (v)
such Manufactured Home Mortgage Loan is (x) a qualified mortgage under Section
860G(a)(3) of the Internal Revenue Code of 1986, as amended and (y) secured by
manufactured housing treated as a single family residence under Section
25(e)(10) of the Code. As of the date of origination, no portion of the
Mortgaged Property was used for commercial purposes, and, to the Company's
knowledge as of the Transfer Date, no portion of the Mortgaged Property has been
used for commercial purposes; provided, that Mortgaged Properties which contain
a home office shall not be considered as being used for commercial purposes as
long as the Mortgaged Property has not been altered for commercial purposes and
is not storing any chemicals or raw materials other than those commonly used for
homeowner repair, maintenance and/or household purposes;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements on
the Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to such
buildings, and all additions, alterations and replacements made at any time,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. In no event shall any Mortgage Loan be
in a lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(i) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(ii) the lien of current real property taxes and assessments
not yet due and payable;
(iii) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of
recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b) which
do not adversely affect the Appraised Value of the Mortgaged
Property set forth in such appraisal; and
(iv) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of the
security intended to be provided by the Mortgage or the use,
enjoyment, value or marketability of the related Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable (subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity) and
perfected (A) first lien and first priority security interest with respect to
each First Lien Loan, or (B) second lien and second priority security interest
with respect to each Second Lien Loan, in either case, on the property described
therein and Company has full right to sell and assign the same to Purchaser.
With respect to each Second Lien Loan, the Mortgaged Property was not, as of the
date of origination of such Second Lien Loan, subject to a mortgage, deed of
trust, deed to secure debt or other security instrument creating a lien
subordinate to the lien of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage and any other agreement executed and delivered by a Mortgagor or
guarantor, if applicable, in connection with a Mortgage Loan are genuine, and
each is the legal, valid and binding obligation of the maker thereof enforceable
in accordance with its terms, subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity (including,
without limitation, any provisions therein relating to Prepayment Charges). All
parties to the Mortgage Note, the Mortgage and any other such related agreement
had legal capacity to enter into the Mortgage Loan and to execute and deliver
the Mortgage Note, the Mortgage and any other related agreement, and the
Mortgage Note, the Mortgage and any other such related agreement have been duly
and properly executed by other such related parties. The documents, instruments
and agreements submitted for loan underwriting were not falsified and contain no
untrue statement of material fact or omit to state a material fact required to
be stated therein or necessary to make the information and statements therein
not misleading. As of the Securitization Closing Date, no fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination or servicing of the Mortgage Loan. The Company
has reviewed all of the documents constituting the Servicing File and has made
such inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. Except to the extent the Mortgage
Loan is subject to completion escrows which have been disclosed to and
acknowledged by the Purchaser and which meet the requirements of the
Underwriting Guidelines and as to which a completed Xxxxxx Xxx Form 442 has been
delivered to the Purchaser within sixty (60) days after the related Closing
Date, as of the Securitization Closing Date, the Mortgage Loan has been closed
and 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 improvement and as to disbursements of any
escrow funds therefor have been complied with. As of the Securitization Closing
Date, 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;
(m) Ownership. As of the Closing Date, the Company or MERS was the
sole owner of record and holder of the Mortgage Loan and the indebtedness
evidenced by each Mortgage Note and upon the sale of the Mortgage Loans to the
Purchaser, the Company retained the Mortgage Files or any part thereof with
respect thereto not delivered to the Custodian, the Purchaser or the Purchaser's
designee, in trust only for the purpose of servicing and supervising the
servicing of each Mortgage Loan. As of the Closing Date, upon payment of the
related Purchase Price, the Mortgage Loan was not assigned or pledged, and the
Company had good, indefeasible and marketable title thereto, and had full right
to transfer and sell the Mortgage Loan to the Purchaser free and clear of any
encumbrance, equity, participation interest, lien, pledge, charge, claim or
security interest, and had full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign each
Mortgage Loan pursuant to the Purchase Agreement and immediately following the
sale of each Mortgage Loan, the Purchaser owned such Mortgage Loan free and
clear of any encumbrance, equity, participation interest, lien, pledge, charge,
claim or security interest related to the Company. As of the Closing Date, the
Company intended to relinquish all rights to possess, control and monitor the
Mortgage Loan. Since the Closing Date, the Company has had and will have no
right to modify or alter the terms of the sale of the Mortgage Loan and the
Company has had and will have no obligation or right to repurchase the Mortgage
Loan or substitute another Mortgage Loan, except as provided in the Purchase
Agreement;
(n) Doing Business. As of the Closing Date, all parties which have
had any interest in the Mortgage Loan, whether as mortgagee, assignee, pledgee
or otherwise, are (or, during the period in which they held and disposed of such
interest, were) (1) in compliance with any and all applicable licensing
requirements of the laws of the state wherein the Mortgaged Property is located,
and (2) either (i) organized under the laws of such state, or (ii) qualified to
do business, or exempt from such qualification, in such state, or (iii) a
federal savings and loan association, a savings bank or a national bank having a
principal office in such state, or (3) not doing business in such state;
(o) CLTV, LTV; FICO Score. As of the Securitization Closing Date, no
Mortgage Loan that is a Second Lien Loan has a CLTV in excess of 100% and no
Mortgage Loan has an LTV greater than 100%. At origination of the Mortgage Loan,
the Mortgagor did not have a FICO score of less than 500;
(p) Title Insurance. The 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 Xxxxxxx Mac and each such title insurance
policy is issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and
qualified to do business in the jurisdiction where the Mortgaged Property is
located, insuring the Company, its successors and assigns, as to the first
priority lien (with respect to First Lien Loans) or second priority lien (with
respect to Second Lien Loans) of the Mortgage in the original principal amount
of the Mortgage Loan, subject only to the exceptions contained in clauses (1),
(2) and (3) of paragraph (j) of this Exhibit B, and in the case of Adjustable
Rate Mortgage Loans, against any loss by reason of the invalidity or
unenforceability of the lien resulting from the provisions of the Mortgage
providing for adjustment to 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.
Additionally, such lender's title insurance policy affirmatively insures ingress
and egress, and against encroachments by or upon the Mortgaged Property or any
interest therein. The title policy does not contain any special exceptions
(other than the standard exclusions) for zoning and uses and has been marked to
delete the standard survey exception or to replace the standard survey exception
with a specific survey reading. The Company, its successor and assigns, are the
sole insureds of such lender's title insurance policy, and to the Company's
knowledge as of the Transfer Date, such lender's title insurance policy is valid
and remains in full force and effect and will be in force and effect upon the
consummation of the purchase transactions contemplated by this Agreement. Except
as disclosed in writing by the Company to the Purchaser on or prior to the
Transfer Date, no claims have been made under such lender's title insurance
policy, and no prior holder of the related Mortgage, including the Company, has
done, by act or omission, anything which would impair the coverage of such
lender's title insurance policy, including without limitation, no unlawful fee,
commission, kickback or other unlawful compensation or value of any kind has
been or will be received, retained or realized by any attorney, firm or other
person or entity, and no such unlawful items have been received, retained or
realized by the Company;
(q) No Defaults. Other than payments due but not yet 30 days or more
delinquent, as of the Closing Date and to the Company's knowledge as of the
Transfer Date (except as set forth on the Mortgage Loan Schedule delivered by
the Company to the Purchaser on the Transfer Date), there is no default, breach,
violation or event which would permit acceleration existing under the Mortgage
or the Mortgage Note and no event which, with the passage of time or with notice
and the expiration of any grace or cure period, would constitute a default,
breach, violation or event which would permit acceleration, and neither the
Company nor any of its affiliates nor any of their respective predecessors, have
waived any default, breach, violation or event which would permit acceleration.
With respect to each Second Lien Loan, as of the Closing Date and to the
Company's knowledge as of the Transfer Date, (i) the prior mortgage is in full
force and effect, (ii) there is no default, breach, violation or event of
acceleration existing under such prior mortgage or the related mortgage note and
(iii) there is no event which, with the passage of time or with notice and the
expiration of any grace or cure period, would constitute a default, breach,
violation or event of acceleration thereunder, and either (A) the prior mortgage
contains a provision which allows or (B) applicable law or the related Mortgage
requires, the mortgagee under the Second Lien Loan to receive notice of, and
affords such mortgagee an opportunity to cure any default by payment in full or
otherwise under the prior mortgage;
(r) No Mechanics' Liens. Except as insured against by the related
title insurance, as of the Closing Date and to the Company's knowledge as of the
Transfer Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Transfer Date), 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 the law could give rise to such liens) affecting the
related Mortgaged Property which are or may be liens prior to, or equal or
coordinate with, the lien of the related Mortgage;
(s) Location of Improvements; No Encroachments. All improvements
which were considered in determining the Appraised Value of the Mortgaged
Property lay wholly within the boundaries and building restriction lines of the
Mortgaged Property, and no improvements on adjoining properties encroach upon
the Mortgaged Property. As of the Closing Date and to the Company's knowledge as
of the Transfer Date (except as disclosed in writing by the Company to the
Purchaser on or prior to the Transfer Date), the Mortgaged Property and all
improvements located on or being part of the Mortgaged Property are in
compliance with all applicable zoning and building laws, ordinances and
regulations;
(t) Origination; Payment Terms. As of the Securitization Closing
Date, 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 Act, a
savings and loan association, a savings bank, a commercial bank, credit union,
insurance company or other similar institution which is supervised and examined
by a federal or state authority. The documents, instruments and agreements
submitted for loan underwriting were not falsified and contain no untrue
statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the information and statements therein not
misleading. No Mortgage Loan contains terms or provisions which would result in
negative amortization. Principal and/or interest payments on the Mortgage Loan
commenced or will commence no more than sixty days after funds were disbursed in
connection with the Mortgage Loan. The Mortgage Interest Rate as well as, with
respect to Adjustable Rate Mortgage Loans, the Lifetime Rate Cap, the Periodic
Rate Floor and the Periodic Rate Cap are as set forth on the related Mortgage
Loan Schedule. The Mortgage Interest Rate is required to be adjusted, with
respect to Adjustable Rate Mortgage Loans, on each Interest Rate Adjustment Date
to equal the Index plus the Gross Margin (rounded up or down to the nearest
0.125%), subject to the Periodic Rate Cap, the Periodic Rate Floor and the
Lifetime Rate Cap. Subject to a "balloon" payment in the case of a Balloon
Mortgage Loan, the Mortgage Note is payable in equal monthly installments of
principal and/or interest, which installments are subject to change due to
adjustments to the Mortgage Interest Rate and/or Monthly Payment on each
Interest Rate Adjustment Date or Monthly Payment Adjustment Date, with interest
calculated and payable in arrears, sufficient to amortize the Mortgage Loan
fully by the stated maturity date (unless the Mortgage Loan is identified on the
Mortgage Loan Schedule as a Balloon Mortgage Loan or an Interest Only Mortgage
Loan), over an original term of not more than thirty years from commencement of
amortization. Unless otherwise specified on the related Mortgage Loan Schedule,
the Mortgage Loan is payable on the first day of each month. There are no
Convertible Mortgage Loans which contain a provision allowing the Mortgagor to
convert the Mortgage Note from an adjustable interest rate Mortgage Note to a
fixed interest rate Mortgage Note. The Due Date of the first payment under the
Mortgage Note is no more than 60 days from the date of the Mortgage Note;
(u) Customary Provisions. The Mortgage contains customary and
enforceable provisions (subject to bankruptcy, insolvency, and similar laws
affecting the rights of creditors and general principles of equity) 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, (i) in the case of a Mortgage designated as a deed
of trust, by trustee's sale, and (ii) otherwise by judicial foreclosure. Upon
default by a Mortgagor on a Mortgage Loan and foreclosure on, or trustee's sale
of, the Mortgaged Property pursuant to the proper procedures, the holder of the
Mortgage Loan will be able to deliver good and merchantable title to the
Mortgaged Property. There is no homestead or other exemption available to a
Mortgagor which would interfere with the right to sell the Mortgaged Property at
a trustee's sale or the right to foreclose the Mortgage, subject to applicable
federal and state laws and judicial precedent with respect to bankruptcy and
right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The
Mortgage Loan was underwritten in accordance with the related Underwriting
Guidelines. The Mortgage Note and Mortgage are on forms acceptable in the
secondary mortgage market and no representations have been made to a Mortgagor
that are inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date, and
to the Company's knowledge as of the Transfer Date, the Mortgaged Property is
capable of being lawfully occupied under applicable law. As of the Closing Date,
and to the Company's knowledge as of the Transfer Date, 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. The Company has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Company has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. If the Mortgage Loan is identified as "owner-occupied" in the
related Mortgage Loan Schedule, the Mortgagor represented at the time of
origination of the Mortgage Loan that the Mortgagor would occupy the Mortgaged
Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The 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 in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and as of the Closing Date, and to the
Company's knowledge as of the Transfer Date, so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. To the Company's knowledge as of the
Transfer Date, there are no circumstances or conditions with respect to the
Mortgage, the Mortgaged Property, the Mortgagor, the Mortgage File or the
Mortgagor's credit standing that can reasonably be expected to cause private
institutional investors who invest in mortgage loans similar to the Mortgage
Loan to regard the Mortgage Loan as an unacceptable investment, cause the
Mortgage Loan to become delinquent, or adversely affect the value or
marketability of the Mortgage Loan, or cause the Mortgage Loan to prepay during
any period materially faster or slower than the mortgage loans originated by the
Company generally except for the non-prime nature of the Mortgage Loans and the
related Mortgagor's credit. No Mortgaged Property is located in a state, city,
county or other local jurisdiction as described in the related Purchase Price
and Terms Agreement which the Purchaser has determined in its reasonable good
faith discretion would cause the related Mortgage Loan to be ineligible for
whole loan sale or securitization in a transaction consistent with the
prevailing sale and securitization industry (including, without limitation, the
practice of the rating agencies) with respect to substantially similar mortgage
loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the
Mortgage, the Assignment of Mortgage, if any, and any other documents required
to be delivered to the Custodian under this Agreement for each Mortgage Loan
have been delivered to the Custodian. The Company is in possession of a
complete, true and accurate Mortgage File in compliance with Exhibit A to the
Purchase Agreement, except for such documents the originals of which have been
delivered to the Custodian, and the Company has retained copies thereof;
(bb) Condominiums/Planned Unit Developments. As of the
Securitization Closing Date, if the Mortgaged Property is a condominium unit or
a planned unit development (other than a de minimis planned unit development)
such condominium or planned unit development project is in conformance with the
related Underwriting Guidelines;
(cc) Transfer of Mortgage Loans. As of the Securitization Closing
Date, except with respect to MERS Designated Mortgage Loans, the Assignment of
Mortgage with respect to each Mortgage Loan is in recordable form and is
acceptable for recording under the laws of the jurisdiction in which the
Mortgaged Property is located. The transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages by the Company are not subject to the bulk
transfer or similar statutory provisions in effect in any applicable
jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision (subject to applicable law) for the
acceleration of the payment of the unpaid principal balance of the Mortgage Loan
in the event that the Mortgaged Property is sold or transferred without the
prior written consent of the mortgagee thereunder, and such provision is
enforceable, subject to applicable law;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Company, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Company has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. As of the Securitization
Closing Date, any future advances made to the Mortgagor prior to the applicable
Cut-off Date have been consolidated with the outstanding principal amount
secured by the Mortgage, and the secured principal amount, as consolidated,
bears a single interest rate and single repayment term. The lien of the Mortgage
securing the consolidated principal amount is expressly insured as having first
or second, as applicable, lien priority by a title insurance policy, an
endorsement to the policy insuring the mortgagee's consolidated interest or by
other title evidence acceptable to Xxxxxx Xxx and Xxxxxxx Mac. The consolidated
principal amount does not exceed the original principal amount of the Mortgage
Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. As
of the Closing Date, and to the Company's knowledge as of the Securitization
Closing Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Securitization Closing Date), there is no proceeding pending or
threatened for the total or partial condemnation of the Mortgaged Property. As
of the Closing Date, and to the Company's knowledge as of the Securitization
Closing Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Securitization Closing Date), the Mortgaged Property is
undamaged by waste, fire, earthquake or earth movement, windstorm, flood,
tornado or other casualty so as to affect adversely the value of the Mortgaged
Property as security for the Mortgage Loan or the use for which the premises
were intended and each Mortgaged Property is in good repair. As of the Closing
Date, there have not been any condemnation proceedings with respect to the
Mortgaged Property.
(ii) Collection Practices; Escrow Deposits; Interest Rate
Adjustments. The origination, servicing and collection practices with respect to
the Mortgage Loan have been in all respects in compliance with Accepted
Servicing Practices, applicable laws and regulations, and have been in all
respects legal and proper. With respect to escrow deposits and Escrow Payments
(other than with respect to Second Lien Loans for which the mortgagee under the
prior mortgage lien is collecting Escrow Payments), all such payments are in the
possession of, or under the control of, the Company through the Transfer Date,
and, as of such date, there exist no deficiencies in connection therewith for
which customary arrangements for repayment thereof have not been made that will
be assigned without penalty, premium or cost to the Purchaser. Each Mortgage
Loan is covered by a paid in full, life of loan, tax service contract that will
be assigned without penalty, premium or cost to the Purchaser. All Escrow
Payments collected by the Company have been collected in full compliance with
state and federal law and the provisions of the related Mortgage Note and
Mortgage. An escrow of funds is not prohibited by applicable law and all escrows
that have been established have been established in an amount sufficient to pay
for every item that remains unpaid and has been assessed but is not yet due and
payable. No escrow deposits or Escrow Payments or other charges or payments due
the Company have been capitalized by the Company under the Mortgage or the
Mortgage Note. All Mortgage Interest Rate adjustments have been made in strict
compliance with state and federal law and the terms of the related Mortgage and
Mortgage Note on the related Interest Rate Adjustment Date. If, pursuant to the
terms of the Mortgage Note, another index was selected for determining the
Mortgage Interest Rate, the same index was used with respect to each Mortgage
Note which required a new index to be selected, and such selection did not
conflict with the terms of the related Mortgage Note. Any and all notices
required under applicable law and the terms of the related Mortgage Note and
Mortgage regarding the Mortgage Interest Rate and the Monthly Payment
adjustments have been delivered. Any interest required to be paid by the Company
to the Mortgagor pursuant to state, federal and local law has been properly paid
and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan fits within the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. Except as
disclosed in writing by the Company to the Purchaser on or prior to the Transfer
Date, to the Company's knowledge, no action, inaction or event has occurred and
no state of facts exists or has existed that has resulted or will result in the
exclusion from, denial of, or defense to coverage under any applicable primary
mortgage insurance policy, hazard insurance policy or bankruptcy bond
(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), irrespective of the cause of such
failure of coverage. The Company has caused or, before or in connection with the
transfer of servicing, will cause to be performed any and all acts required to
preserve the rights and remedies of the Purchaser in any insurance policies
applicable to the Mortgage Loans including, without limitation, any necessary
notifications of insurers, assignments of policies or interests therein, and
establishments of coinsured, joint loss payee and mortgagee rights in favor of
the Purchaser. In connection with the placement of any such insurance, no
commission, fee, or other compensation has been or will be received by the
Company or by any officer, director, or employee of the Company or any designee
of the Company or any corporation in which the Company or any officer, director,
or employee had a financial interest at the time of placement of such insurance;
(ll) No Violation of Environmental Laws. As of the Closing Date, and
to the Company's knowledge as of the Transfer Date (except as disclosed in
writing by the Company to the Purchaser on or prior to the Transfer Date), the
Mortgaged Property is free from any and all toxic or hazardous substances and
there exists no violation of any local, state or federal environmental law, rule
or regulation. As of the Closing Date, and to the Company's knowledge as of the
Transfer Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Transfer Date), 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. As of the Closing Date, based
upon customary and prudent residential mortgage industry underwriting standards,
and as of the Transfer Date (except as disclosed in writing by the Company to
the Purchaser on or prior to the Transfer Date), in each case to the Company's
knowledge, there is no violation of any environmental law, rule or regulation
with respect to the Mortgage 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;
(mm) Servicemembers Civil Relief Act. The Mortgagor has not notified
the Company, and the Company has no knowledge of any relief requested or allowed
to the Mortgagor under the Servicemembers Civil Relief Act, or any similar state
statute;
(nn) Appraisal. The Company has delivered to the Purchaser an
appraisal of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser who (i) was licensed in the state where the
Mortgaged Property is located, (ii) had no interest, direct or indirect, in the
Mortgaged Property or in any Mortgage Loan or the security therefor, and (iii)
did not receive compensation that affected the approval or disapproval of the
Mortgage Loan. The appraisal shall have been made within one hundred and eighty
(180) days of the origination of the Mortgage Loan and shall be completed in
compliance with the Uniform Standards of Professional Appraisal Practice, and
all applicable federal and state laws and regulations. If the appraisal was made
more than one hundred and twenty (120) days before the origination of the
Mortgage Loan, the Company shall have received and delivered to the Purchaser a
recertification of the appraisal;
(oo) Disclosure Materials. As of the Securitization Closing Date,
the Mortgagor has, to the extent required by applicable law, executed one or
more statements to the effect that the Mortgagor has, received all disclosure
materials required by applicable law and the Company has complied with all
applicable law with respect to the making of the Mortgage Loans. The Company
shall cause the Interim Servicer to maintain such statement(s) in the Mortgage
File;
(pp) Construction or Rehabilitation of Mortgaged Property. As of the
Securitization Closing Date, the Mortgage Loan was not made to finance the
construction or rehabilitation of a Mortgaged Property or facilitating the
trade-in or exchange of a Mortgaged Property;
(qq) Qualified Mortgage. As of the Closing Date, the Mortgage Loan
is a qualified mortgage under Section 860G(a)(3) of the Code;
(rr) Credit Information. As to each consumer report (as defined in
the Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Company to the Purchaser, the Company has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Company shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Company has in its capacity as a servicer, for each Mortgage
Loan, fully furnished, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g., favorable and
unfavorable) on its borrower credit files to Equifax, Experian and Trans Union
Credit Information Company (three of the credit repositories), on a monthly
basis;
(ss) Leaseholds. As of the Closing Date, and to the Company's
knowledge as of the Transfer Date, if the Mortgage Loan is secured by a
long-term residential lease, (1) the lessor under the lease holds a fee simple
interest in the land; (2) the terms of such lease expressly permit the
mortgaging of the leasehold estate and the acquisition by the holder of the
Mortgage of the rights of the lessee upon foreclosure or assignment in lieu of
foreclosure or provide the holder of the Mortgage with substantially similar
protections; (3) the terms of such lease do not (a) allow the termination
thereof upon the lessee's default without the holder of the Mortgage being
entitled to receive written notice of, and opportunity to cure, such default,
(b) allow the termination of the lease in the event of damage or destruction as
long as the Mortgage is in existence, (c) prohibit the holder of the Mortgage
from being insured (or receiving proceeds of insurance) under the hazard
insurance policy or policies relating to the Mortgaged Property or (d) permit
any increase in rent other than pre-established increases set forth in the
lease; (4) the original term of such lease is not less than 15 years; (5) the
term of such lease does not terminate earlier than five years after the maturity
date of the Mortgage Note; and (6) the Mortgaged Property is located in a
jurisdiction in which the use of leasehold estates in transferring ownership in
residential properties is a widely accepted practice;
(tt) Prepayment Penalty. The Mortgage Loan is subject to a
prepayment penalty as provided in the related Mortgage Note except as set forth
on the related Mortgage Loan Schedule. With respect to each Mortgage Loan that
has a prepayment penalty feature, each such prepayment penalty is enforceable
(subject to bankruptcy, insolvency, and similar laws affecting the rights of
creditors and general principles of equity) for the benefit of the Purchaser,
and each prepayment penalty is permitted pursuant to applicable law. Each such
prepayment penalty is in an amount not greater than the maximum amount permitted
under applicable law and no such prepayment penalty may be imposed for a term in
excess of five (5) years;
(uu) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(vv) Escrow Analysis. With respect to each Mortgage, the Company has
within the twelve months preceding the Closing Date (unless such Mortgage was
originated within such twelve month period) analyzed the required Escrow
Payments for each Mortgage and adjusted the amount of such payments so that,
assuming all required payments are timely made, any deficiency will be
eliminated on or before the first anniversary of such analysis, or any overage
will be refunded to the Mortgagor, in accordance with RESPA and any other
applicable law;
(ww) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion and as described in the related Purchase Price and
Terms Agreement;
(xx) Single-premium credit life insurance policy. As of the
Securitization Closing Date, in connection with the origination of the Mortgage
Loan, no proceeds from such Mortgage Loan were used to finance or acquire a
single-premium credit life insurance policy, credit disability, credit
unemployment or credit property insurance policy;
(yy) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or an Illinois land trust or a "living trust" and such "living
trust" is in compliance with Xxxxxx Xxx guidelines for such trusts;
(zz) Insurance. The Company has caused or, before or in connection
with the transfer of servicing, will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser;
(aaa) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(bbb) Flood Certification Contract. The Mortgage Loan is covered by
a paid in full, life of loan, transferable flood certification contract that has
been or will be assigned without penalty, cost or premium to the Purchaser;
(ccc) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(ddd) Origination Date. Except as shown on the related Mortgage Loan
Schedule, the date of origination of the Mortgage Loan shall be no earlier than
three (3) months prior to the date such Mortgage Loan was first purchased by the
Purchaser;
(eee) Mortgage Submitted for Recordation. As of the Closing Date,
and to the Company's knowledge as of the Transfer Date, the Mortgage either has
been or will promptly be submitted for recordation in the appropriate
governmental recording office of the jurisdiction where the Mortgaged Property
is located;
(fff) Endorsements. The Mortgage Note has been endorsed by Company
for its own account and not as a fiduciary, trustee, trustor or beneficiary
under a trust agreement;
(ggg) Accuracy of Information. All information provided to the
Purchaser by the Company with respect to the Mortgage Loan was accurate in all
material respects;
(hhh) No Construction Loans. No Mortgage Loan was made to (a)
facilitate the trade-in or exchange of a Mortgaged Property or (b) finance the
construction or rehabilitation of a Mortgaged Property, unless the Mortgage Loan
is a construction-to-permanent mortgage loan which has been fully disbursed, all
construction work is complete and a completion certificate has been issued;
(iii) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Company has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor; and
(jjj) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction.
================================================================================
THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES AGREEMENT
------------------------
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
ACCREDITED HOME LENDERS, INC.,
Seller
------------------------
Dated as of August 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
================================================================================
TABLE OF CONTENTS
SECTION 1. DEFINITIONS...................................................
SECTION 2. AGREEMENT TO PURCHASE.........................................
SECTION 3. MORTGAGE SCHEDULES............................................
SECTION 4. PURCHASE PRICE................................................
SECTION 5. EXAMINATION OF MORTGAGE FILES.................................
SECTION 6. CONVEYANCE FROM SELLER TO PURCHASER...........................
Subsection 6.01. Conveyance of Mortgage Loans; Possession of Servicing
Files...................................................
Subsection 6.02 Books and Records.......................................
Subsection 6.03. Delivery of Mortgage Loan Documents.....................
Subsection 6.04. Quality Control Procedures..............................
Subsection 6.05. MERS Designated Mortgage Loans..........................
SECTION 7. SERVICING OF THE MORTGAGE LOANS...............................
SECTION 8. TRANSFER OF SERVICING.........................................
SECTION 9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER;
REMEDIES FOR BREACH..........................................
Subsection 9.01. Representations and Warranties Regarding the Seller.....
Subsection 9.02. Representations and Warranties Regarding Individual
Mortgage Loans..........................................
Subsection 9.03. Remedies for Breach of Representations and Warranties...
Subsection 9.04. Repurchase of Mortgage Loans That Prepay in Full........
Subsection 9.05. Repurchase of Mortgage Loans with First Payment
Defaults................................................
Subsection 9.06. Purchaser's Right to Review.............................
SECTION 10. CLOSING.......................................................
SECTION 11. CLOSING DOCUMENTS.............................................
SECTION 12. COSTS.........................................................
SECTION 13. COOPERATION OF SELLER WITH A RECONSTITUTION...................
SECTION 14. THE SELLER....................................................
Subsection 14.01. Additional Indemnification by the Seller; Third Party
Claims.................................................
Subsection 14.02. Merger or Consolidation of the Seller..................
SECTION 15. FINANCIAL STATEMENTS..........................................
SECTION 16. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST................
SECTION 17. NOTICES.......................................................
SECTION 18. SEVERABILITY CLAUSE...........................................
SECTION 19. COUNTERPARTS..................................................
SECTION 20. GOVERNING LAW JURISDICTION; CONSENT TO SERVICE OF PROCESS.....
SECTION 21. INTENTION OF THE PARTIES......................................
SECTION 22. SUCCESSORS AND ASSIGNS; ASSIGNMENT OF PURCHASE AGREEMENT......
SECTION 23. WAIVERS.......................................................
SECTION 24. EXHIBITS......................................................
SECTION 25. GENERAL INTERPRETIVE PRINCIPLES...............................
SECTION 26. REPRODUCTION OF DOCUMENTS.....................................
SECTION 27. FURTHER AGREEMENTS............................................
SECTION 28. RECORDATION OF ASSIGNMENTS OF MORTGAGE........................
SECTION 29. NO SOLICITATION...............................................
SECTION 30. WAIVER OF TRIAL BY JURY.......................................
SECTION 31. COMPLIANCE WITH REGULATION AB.................................
Subsection 31.01. Intent of the Parties; Reasonableness..................
Subsection 31.02. Additional Representations and Warranties of the Seller
Subsection 31.03. Information to Be Provided by the Seller...............
Subsection 31.04. Indemnification; Remedies..............................
EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B [RESERVED]
EXHIBIT C FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE INTERIM
SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G [RESERVED]
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT J FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
THIRD AMENDED AND RESTATED
MORTGAGE LOAN PURCHASE AND WARRANTIES AGREEMENT
This THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT (the "Agreement"), dated as of August 1, 2006, by and
between IXIS Real Estate Capital Inc. f/k/a CDC Mortgage Capital Inc., a New
York corporation, having an office at 0 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000 (the "Purchaser"), and Accredited Home Lenders, Inc., a
California corporation, having an office at 00000 Xxxxxx xx Xxxxxxx, Xxx Xxxxx,
Xxxxxxxxxx 00000 (the "Seller").
W I T N E S S E T H:
WHEREAS, the Purchaser and the Seller are parties to that certain
Second Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of March 1, 2006 (the "Original Purchase Agreement"), pursuant to which
the Seller desires to sell, from time to time, to the Purchaser, and the
Purchaser desires to purchase, from time to time, from the Seller, certain first
and second lien, adjustable-rate and fixed-rate B/C residential mortgage loans
(the "Mortgage Loans") on a servicing released basis as described herein, and
which shall be delivered in pools of whole loans (each, a "Mortgage Loan
Package") on various dates as provided herein (each, a "Closing Date"); and
WHEREAS, at the present time, the Purchaser and the Seller desire to
amend and restate the Original Purchase Agreement to make certain modifications
as set forth herein, and upon the execution and delivery of this Agreement by
the Purchaser and the Seller this Agreement shall supercede the Original
Purchase Agreement and supplant the Original Purchase Agreement;
NOW, THEREFORE, in consideration of the premises and mutual
agreements set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Purchaser and the
Seller agree as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms shall
have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan,
those mortgage servicing practices of prudent mortgage lending institutions
which service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac Transfer.
Agreement: This Third Amended and Restated Mortgage Loan Purchase
and Warranties Agreement and all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value
of the related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property if purchased at or within twelve months prior to such
time of origination, whichever is less, and (ii) with respect to any Second Lien
Loan, the value, determined pursuant to the Seller's Underwriting Guidelines, of
the related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in Subsection 6.01.
Assignment of Mortgage: An 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
the sale of the Mortgage to the Purchaser.
Balloon Mortgage Loan: Any Mortgage Loan that requires only payments
of interest until the stated maturity date of the Mortgage Loan or the Monthly
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by the stated maturity date of the
Mortgage Loan.
Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a
day on which banking and savings and loan institutions, in the State of New York
or the state in which the Interim Servicer's servicing operations are located,
are authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to
time shall purchase and the Seller from time to time shall sell the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value and (2) any First Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the First Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are junior or equal in
priority to the First Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission:__The United States Securities and Exchange Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created and
maintained pursuant to Section 2.04 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, to be executed between the Purchaser and the Custodian
and to be dated as of the related Cut-Off Date.
Custodian: The custodian under the Custodial Agreement, or its
successor in interest or assigns, or any successor to the Custodian under the
Custodial Agreement, as therein provided. If at any time there is no Custodial
Agreement in effect with respect to a Mortgage Loan, all references to the
Custodian herein and in the Interim Servicing Agreement shall be deemed to refer
to the Purchaser (or its designee) with respect to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Deemed Material Breach Representation:__Each representation
identified as such in Subsection 9.02.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or
replaced or to be replaced with a Qualified Substitute Mortgage Loan by the
Seller in accordance with the terms of this Agreement.
Delinquency Collection Policies and Procedures: The delinquency
collection policies and procedures of the Seller, a copy of which is attached to
the Interim Servicing Agreement.
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is due
on a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term unsecured
debt obligations of which (or, in the case of a depository institution or trust
company that is a subsidiary of a holding company, the short-term unsecured debt
obligations of such holding company) are rated A-1 by Standard & Poor's or
Prime-1 by Moody's (or a comparable rating if another Rating Agency is specified
by the Purchaser by written notice to the Seller) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, or (iii) a trust account or accounts maintained with
a federal or state chartered depository institution or trust company acting in
its fiduciary capacity.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
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.
Exchange Act.__The Securities Exchange Act of 1934, as amended.
Xxxxxx Mae: The Federal National Mortgage Association and its
successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Xxx
Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 13 hereof.
FDIC: The Federal Deposit Insurance Corporation and its successors
in interest.
FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage
on the related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
Fixed Rate Mortgage Loan: A fixed rate mortgage loan purchased
pursuant to this Agreement.
Xxxxxxx Mac: The Federal Home Loan Mortgage Corporation and its
successors in interest.
Xxxxxxx Mac Transfer: As defined in Section 13 hereof.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan,
the fixed percentage amount set forth in the related Mortgage Note which amount
is added to the Index in accordance with the terms of the related Mortgage Note
to determine on each Interest Rate Adjustment Date the Mortgage Interest Rate
for such Mortgage Loan.
High Cost Loan: A Mortgage Loan (a) covered by the Home Ownership
and Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual percentage
rate" or total "points and fees" payable by the related Mortgagor (as each such
term is calculated under HOEPA) that exceed the thresholds set forth by HOEPA
and its implementing regulations, including 12 C.F.R. ss. 226.32(a)(1)(i) and
(ii), (c) classified as a "high cost home," "threshold," "covered," "high risk
home," "predatory" or similar loan under any other 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) or
(d) a Mortgage Loan categorized as High Cost pursuant to Appendix E of Standard
& Poor's Glossary. For avoidance of doubt, the parties agree that this
definition shall apply to any law regardless of whether such law is presently,
or in the future becomes, the subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also deemed to include subdivisions thereof such as the FHA
and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, the index
identified in the related Mortgage Note, as set forth in the related Mortgage
Loan Schedule and as set forth on Exhibit B to each Assignment and Conveyance
Agreement.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Only Mortgage Loan: A Mortgage Loan which only requires
payments of interest for an initial period of time specified in the related
Mortgage Note.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan,
the Person named on the MERS(R) System as the interim funder pursuant to the
MERS Procedures Manual.
Interim Servicer: Accredited Home Lenders, Inc., a California
corporation, and its successors in interest, and any successor interim servicer
under the Interim Servicing Agreement.
Interim Servicing Agreement: The Interim Servicing Agreement, dated
as of October 1, 2003, between the Purchaser and the Interim Servicer, providing
for the Interim Servicer to service the Mortgage Loans for an interim period as
specified by the Interim Servicing Agreement.
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the investor pursuant to the MERS
Procedures Manual.
Lifetime Rate Cap: The provision of each Mortgage Note related to an
Adjustable Rate Mortgage Loan which provides for an absolute maximum Mortgage
Interest Rate thereunder. The Mortgage Interest Rate during the terms of each
Adjustable Rate Mortgage Loan is not at any time to exceed the Mortgage Interest
Rate at the time of origination of such Adjustable Rate Mortgage Loan by more
than the Lifetime Rate Cap.
Liquidation Proceeds: Cash received in connection with the
liquidation of a defaulted Mortgage Loan, whether through the sale or assignment
of such Mortgage Loan, trustee's sale, foreclosure sale or otherwise, or the
sale of the related Mortgaged Property if the Mortgaged Property is acquired in
satisfaction of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the outstanding principal amount of the
Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
Appraised Value of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the
Seller has designated or will designate MERS as, and has taken or will take such
action as is necessary to cause MERS to be, the mortgagee of record, as nominee
for the Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor on the MERS(R)
System.
MERS Procedure Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and/or
interest on a Mortgage Loan.
Monthly Payment Adjustment Date: With respect to each Interest Only
Mortgage Loan which is also a Fixed Rate Mortgage Loan, the date, specified in
the related Mortgage Note and the Mortgage Loan Schedule, on which the Monthly
Payment is adjusted.
Moody's: Xxxxx'x Investors Service, Inc. and its successors in
interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on the Mortgaged Property.
Mortgage File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit A annexed hereto, and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: The annual rate of interest borne on a
Mortgage Note with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, 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 required to be delivered to
the Custodian pursuant to Section 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting forth
the following information with respect to each Mortgage Loan in the related
Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying number; (2)
the Mortgagor's 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 investment property; (5) the number
and type of residential units constituting the Mortgaged Property (i.e., a
single family residence, a 2-4 family residence, a unit in a condominium project
or a unit in a planned unit development, manufactured housing); (6) the Mortgage
Loan origination date; (7) the original months to maturity or the remaining
months to maturity from the related Cut-off Date, in any case 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 Loan-to-Value
Ratio at origination; (9) with respect to First Lien Loans, the LTV and with
respect to Second Lien Loans, the CLTV; (10) the Mortgage Interest Rate as of
the related Cut-off Date; (11) the date on which the Monthly Payment was due on
the Mortgage Loan and, if such date is not consistent with the Due Date
currently in effect, such Due Date; (12) the stated maturity date; (13) the
amount of the Monthly Payment as of the related Cut-off Date; (14) the last
payment date as of which a payment was actually applied to the outstanding
principal balance; (15) the original principal amount of the Mortgage Loan; (16)
the 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 and collected
on or before the Cut-off Date; (17) the Interest Rate Adjustment Date; (18) the
Gross Margin; (19) the Lifetime Rate Cap under the terms of the Mortgage Note;
(20) a code indicating the type of Index; (21) the Mortgage Interest Rate as of
origination; (22) the type of Mortgage Loan (i.e., fixed-rate, adjustable-rate,
First Lien, Second Lien); (23) a code indicating the purpose of the loan (i.e.,
purchase, rate and term refinance, equity take-out refinance); (24) a code
indicating the documentation style (i.e., full or stated income); (25) the loan
credit classification (as described in the Underwriting Guidelines); (26) the
applicable Cut-off Date; (27) the applicable Closing Date; (28) the credit risk
score (FICO score); (29) with respect to the related Mortgagor, the
debt-to-income ratio; (30) with respect to Second Lien Loans, the outstanding
principal balance of the superior lien; (31) the Appraised Value of the
Mortgaged Property; (32) the sale price of the Mortgaged Property if the
Mortgage Loan was originated in connection with the purchase of the Mortgaged
Property; (33) the Periodic Rate Cap under the terms of the Mortgage Note; (34)
the Periodic Rate Floor under the terms of the Mortgage Note; (35) whether such
Mortgage Loan provides for a prepayment penalty; (36) the prepayment penalty
period of such Mortgage Loan, if applicable; (37) a description of the type of
prepayment penalty, if applicable; (38) the MERS Identification Number; (39)
whether the Mortgagor represented that the Mortgagor would occupy the Mortgaged
Property as its primary residence; (40) a code indicating if the Mortgage Loan
is a Balloon Mortgage Loan [and (41) a field indicating whether such Mortgage
Loan is a Home Loan]. With respect to the Mortgage Loans in the aggregate, the
Mortgage Loan Schedule shall set forth the following information, as of the
related Cut-off Date: (1) the number of Mortgage Loans; (2) the current
aggregate outstanding principal balance of the Mortgage Loans; (3) the weighted
average Mortgage Interest Rate of the Mortgage Loans; and (4) the weighted
average maturity of the Mortgage Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the
Mortgagor's real property securing repayment of a related Mortgage Note,
consisting of an unsubordinated estate in fee simple or, 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, in a
single parcel or multiple parcels of real property improved by a residential
dwelling as further described in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its successors in
interest.
Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or a Vice President and
by the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of the Seller, and delivered to the Purchaser as required
by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
in-house counsel for the Seller, reasonably acceptable to the Purchaser,
provided that any Opinion of Counsel relating to (a) the qualification of any
account required to be maintained pursuant to this Agreement as an Eligible
Account, (b) qualification of the Mortgage Loans in a REMIC or (c) compliance
with the REMIC Provisions, must be (unless otherwise stated in such Opinion of
Counsel) an opinion of counsel who (i) is in fact independent of the Seller and
any servicer of the Mortgage Loans, (ii) does not have any material direct or
indirect financial interest in the Seller or any servicer of the Mortgage Loans
or in an Affiliate of either and (iii) is not connected with the Seller or any
servicer of the Mortgage Loans as an officer, employee, director or person
performing similar functions.
OTS: Office of Thrift Supervision and its successors in interest.
Periodic Rate Cap: With respect to each Adjustable Rate Mortgage
Loan, the provision of each Mortgage Note which provides for an absolute maximum
amount by which the Mortgage Interest Rate therein may increase on an Interest
Rate Adjustment Date above the Mortgage Interest Rate previously in effect.
Periodic Rate Floor: With respect to each Adjustable Rate Mortgage
Loan, the provision of each Mortgage Note which provides for an absolute maximum
amount by which the Mortgage Interest Rate therein may decrease on an Interest
Rate Adjustment Date below the Mortgage Interest Rate previously in effect.
Person: Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof.
Points Schedule: A schedule which sets forth, with respect to each
Mortgage Loan, the following data points: (1) the loan identification number;
(2) the pool name; (3) the Seller's points; (4) the Seller's rebate; (5) the
Seller's fees; (6) the broker fees and (7) the broker points. All information on
the Points Schedule shall be true, correct and complete.
Preliminary Mortgage Schedule: As defined in Section 3.
Premium Percentage: With respect to any Mortgage Loan, a percentage
equal to the excess of the Purchase Price Percentage over 100%.
Prepayment Charges: With respect to each Mortgage Loan, the charge
if the Mortgagor prepays such Mortgage Loan as provided in the related Mortgage
Note or Mortgage.
Principal Prepayment: Any payment or other recovery of principal on
a Mortgage Loan which is received in advance of its scheduled Due Date,
including any prepayment penalty or premium thereon and which is not accompanied
by an amount of interest representing scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements setting
forth the general terms and conditions of the transactions consummated herein
and identifying the Mortgage Loans to be purchased from time to time hereunder,
by and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an
amount equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York corporation,
and its successors in interest and assigns, or any successor to the Purchaser
under this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Seller and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Seller, in accordance with underwriting
guidelines designated by the Seller ("Designated Guidelines") or guidelines that
do not vary materially from such Designated Guidelines; (ii) such Mortgage Loans
were in fact underwritten as described in clause (i) above and were acquired by
the Seller within one hundred eighty (180) days after origination; (iii) either
(x) the Designated Guidelines were, at the time such Mortgage Loans were
originated, used by the Seller in origination of mortgage loans of the same type
as the Mortgage Loans for the Seller's own account or (y) the Designated
Guidelines were, at the time such Mortgage Loans were underwritten, designated
by the Seller on a consistent basis for use by lenders in originating mortgage
loans to be purchased by the Seller; and (iv) the Seller employed, at the time
such Mortgage Loans were acquired by the Seller, pre purchase or post purchase
quality assurance procedures (which may involve, among other things, review of a
sample of mortgage loans purchased during a particular time period or through
particular channels) designed to ensure that Persons from which it purchased
mortgage loans properly applied the underwriting criteria designated by the
Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in
the Custodial Account by the Seller in the month of substitution); (ii) have a
Mortgage Interest Rate not less than and not more than 1% greater than the
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one (1) year less than that of
the Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan
(i.e., fixed-rate, adjustable-rate with same Periodic Rate Cap, Index and lien
priority); and (v) comply with each representation and warranty (respecting
individual Mortgage Loans) set forth in Section 9 hereof.
Rating Agency: Any of Fitch, Moody's or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan
Transfer.
Reconstitution Agreements: The agreement or agreements entered into
by the Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 13, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement and related
custodial/trust agreement and documents with respect to a Securitization
Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100 229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset Backed Securities,
Securities Act Release No. 33 8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or
by the staff of the Commission, or as may be provided by the Commission or its
staff from time to time.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating
to 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 date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Repurchase Price: With respect to any Mortgage Loan for which a
breach of a representation or warranty from the Agreement or the Interim
Servicing Agreement is found, a price equal to the then outstanding principal
balance of the Mortgage Loan to be repurchased, plus accrued interest thereon at
the Mortgage Interest Rate from the date to which interest had last been paid
through the date of such repurchase, plus the amount of any outstanding advances
owed to any servicer, and plus all costs and expenses reasonably incurred by the
Purchaser or any servicer arising out of or based upon such breach, including
without limitation costs and expenses incurred in the enforcement of the
Seller's repurchase obligation hereunder.
RESPA: Real Estate Settlement Procedures Act, as amended from time
to time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage
on the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction. Any transaction involving either (1) a
sale or other transfer of some or all of the Mortgage Loans directly or
indirectly to an issuing entity in connection with an issuance of publicly
offered or privately placed, rated or unrated mortgage backed securities or (2)
an issuance of publicly offered or privately placed, rated or unrated
securities, the payments on which are determined primarily by reference to one
or more portfolios of residential mortgage loans consisting, in whole or in
part, of some or all of the Mortgage Loans.
Seller: Accredited Home Lenders, Inc., a California corporation, and
its successors in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to the
Interim Servicing Agreement, an amount equal to 0.50% per annum computed on the
basis of the outstanding principal balance of the related Mortgage Loan. Such
fee shall be payable monthly and shall be pro rated for any portion of a month,
other than the month in which the related Closing Date occurs, during which the
Mortgage Loan is serviced by the Interim Servicer under the Interim Servicing
Agreement. The obligation of the Purchaser to pay the Servicing Fee is limited
to, and the Servicing Fee is payable solely from, the interest portion
(including recoveries with respect to interest from Liquidation Proceeds, to the
extent permitted by this Agreement) of such Monthly Payment collected by the
Interim Servicer, or as otherwise provided under this Agreement.
Servicing File: With respect to each Mortgage Loan, the file
retained by the Interim Servicer consisting of originals of all documents in the
Mortgage File which are not delivered to the Purchaser or the Custodian and
copies of the Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and all
rights to service the Mortgage Loans; (b) any payments to or monies received by
the Interim Servicer for servicing the Mortgage Loans; (c) any late fees,
penalties or similar payments with respect to the Mortgage Loans; (d) all
agreements or documents creating, defining or evidencing any such servicing
rights to the extent they relate to such servicing rights and all rights of the
Interim Servicer thereunder; (e) Escrow Payments or other similar payments with
respect to the Mortgage Loans and any amounts actually collected by the Interim
Servicer with respect thereto; (f) all accounts and other rights to payment
related to any of the property described in this paragraph; and (g) any and all
documents, files, records, servicing files, servicing documents, servicing
records, data tapes, computer records, or other information pertaining to the
Mortgage Loans or pertaining to the past, present or prospective servicing of
the Mortgage Loans.
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R)
Glossary, as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as described in
Item 1105(a)(1) (3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Sections 9.03 and 14.01.
Third Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its designee,
shall receive the transfer of servicing responsibilities and begin to perform
the servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: With respect to each Mortgage Loan Package,
the underwriting guidelines of the Seller, a copy of which shall be attached as
an Exhibit to the related Assignment and Conveyance Agreement.
VA: The Department of Veterans Affairs, an agency of the United
States of America, or any successor thereto including the Administrator of
Veterans Affairs.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser
agrees to purchase from time to time, Mortgage Loans having an aggregate
principal balance on the related Cut-off Date in an amount as set forth in the
related Purchase Price and Terms Agreement, or in such other amount as agreed by
the Purchaser and the Seller as evidenced by the actual aggregate principal
balance of the Mortgage Loans accepted by the Purchaser on each Closing Date.
SECTION 3. Mortgage Schedules.
The Seller from time to time shall provide the Purchaser with
certain information constituting a preliminary listing of the Mortgage Loans to
be purchased on each Closing Date in accordance with the related Purchase Price
and Terms Agreement and this Agreement (each, a "Preliminary Mortgage
Schedule").
The Seller shall deliver the Mortgage Loan Schedule and the related
Points Schedule for the Mortgage Loans to be purchased on a particular Closing
Date to the Purchaser at least two (2) Business Days prior to the related
Closing Date or such later date on which the Purchaser has identified to the
Seller the final list of Mortgage Loans the Purchaser desires to purchase.
SECTION 4. Purchase Price.
The Purchase Price for the Mortgage Loans shall be equal to (a) the
Purchase Price Percentage multiplied by the Cut-off Date Balance, plus (b)
accrued and unpaid interest on such principal balance at the weighted average
Mortgage Interest Rate (net of the Servicing Fee) of those Mortgage Loans from
the related Cut-off Date through the day prior to the related Closing Date,
inclusive. For purposes hereof, "Cut-off Date Balance" means the aggregate
principal balance, as of the related Cut-off Date, of the Mortgage Loans listed
on the related Mortgage Loan Schedule, after application of scheduled payments
of principal due on or before the related Cut-off Date, to the extent such
payments were actually received, together with any unscheduled principal
payments collected prior to the Cut-off Date; provided, however, that payments
of scheduled principal and interest paid prior to the Cut-off Date, but to be
applied on a due date beyond the related Cut-off Date, shall not be applied to
the principal balance as of the related Cut-off Date. If so provided in the
related Purchase Price and Terms Agreement, portions of the Mortgage Loans shall
be priced separately. The Purchase Price as so determined shall be paid to the
Seller on the related Closing Date by wire transfer of immediately available
funds to an account or accounts designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, 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, to the extent actually collected, together with any
unscheduled principal prepayments collected prior to the Cut-off Date; provided,
however, that payments of scheduled principal and interest paid prior to the
Cut-off Date, but to be applied on 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 Seller 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
Seller to the Purchaser.
SECTION 5. Examination of Mortgage Files.
At least seven (7) Business Days prior to the related Closing Date,
the Seller shall either deliver to the Purchaser or its designee in escrow, for
examination with respect to each Mortgage Loan to be purchased, or make
available to the Purchaser for examination at such other location as shall
otherwise be acceptable to the Purchaser and Seller, copies or originals of the
credit and servicing files, including the Mortgage File (collectively, the
"Credit Files"). Such examination of the Credit Files may be made by the
Purchaser or its designee at any reasonable time before or after the related
Closing Date. If the Purchaser makes such examination prior to the related
Closing Date and determines, in its sole discretion, that any Mortgage Loans are
unacceptable under the terms of the related Purchase Price and Terms Agreement,
such Mortgage Loans shall be deleted from the related Mortgage Loan Schedule,
and may be replaced by a Qualified Substitute Mortgage Loan (or Loans)
acceptable to the Purchaser. The Purchaser may, at its option and without notice
to the Seller, purchase some or all of the Mortgage Loans without conducting any
partial or complete examination. The fact that the Purchaser or its designee has
conducted or has failed to conduct any partial or complete examination of the
Mortgage Files or the Credit Files shall not impair in any way the Purchaser's
(or any of its successor's) rights to demand repurchase, substitution or other
remedy as provided in this Agreement. Notwithstanding the foregoing, the
Purchaser may not demand a repurchase or other relief or remedy due to the
failure of a Mortgage Loan to comply with the Underwriting Guidelines if the
Purchaser or its designee has previously examined such Mortgage Loan and certain
exceptions to the Underwriting Guidelines were noted and accepted by the
Purchaser prior to the purchase of such Mortgage Loan. In the event that the
Seller fails to deliver the Credit Files with respect to any Mortgage Loan, the
Seller shall, upon the request of the Purchaser, repurchase such Mortgage Loan
at the price and in the manner specified in Subsection 9.03.
SECTION 6. Conveyance from Seller to Purchaser.
Subsection 6.01. Conveyance of Mortgage Loans; Possession of
Servicing Files.
The Seller, simultaneously with the delivery of the Mortgage Loan
Schedule with respect to the related Mortgage Loan Package to be purchased on
each Closing Date, shall execute and deliver an Assignment and Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment and
Conveyance Agreement"). The Seller shall cause the Servicing File retained by
the Interim Servicer pursuant to this Agreement to be appropriately identified
in the Seller's computer system and/or books and records, as appropriate, to
clearly reflect the sale of the related Mortgage Loan to the Purchaser. The
Seller shall cause the Interim Servicer to release from its custody the contents
of any Servicing File retained by it only in accordance with this Agreement or
the Interim Servicing Agreement, except when such release is required in
connection with a repurchase of any such Mortgage Loan pursuant to Subsection
9.03.
Subsection 6.02. Books and Records.
Record title to each Mortgage as of the related Closing Date shall
be in the name of the Seller or MERS. Notwithstanding the foregoing, each
Mortgage and related Mortgage Note shall be beneficially possessed solely by the
Purchaser or the appropriate designee of the Purchaser, as the case may be. All
rights arising out of the Mortgage Loans including, but not limited to, all
funds received by the Seller or the Interim Servicer after the related Cut-off
Date on or in connection with a Mortgage Loan shall be vested in the Purchaser
or one or more designees of the Purchaser; provided, however, that all funds
received on or in connection with a Mortgage Loan shall be received and held by
the Seller or the Interim Servicer in trust for the benefit of the Purchaser or
the appropriate designee of the Purchaser, as the case may be, as the owner of
the Mortgage Loans pursuant to the terms of this Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to be
responsible for maintaining, and shall maintain, a complete set of books and
records for each Mortgage Loan which shall be marked clearly to reflect the
ownership of each Mortgage Loan by the Purchaser. In particular, the Seller
shall or shall cause the Interim Servicer to maintain in its possession,
available for inspection by the Purchaser, and shall deliver to the Purchaser
upon demand, evidence of compliance with all federal, state and local laws,
rules and regulations, and applicable requirements of Xxxxxx Mae or Xxxxxxx Mac,
including but not limited to documentation as to the method used in determining
the applicability of the provisions of the National Flood Insurance Act of 1968,
as amended, to the Mortgaged Property, documentation evidencing insurance
coverage and periodic inspection reports, as required by Accepted Servicing
Practices. To the extent that original documents are not required for purposes
of realization of Liquidation Proceeds or Insurance Proceeds, documents
maintained by the Seller or the Interim Servicer may be in the form of microfilm
or microfiche so long as the Seller or the Interim Servicer complies with
Accepted Servicing Practices.
Subsection 6.03. Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later than
five (5) Business Days prior to the related Closing Date those Mortgage Loan
Documents set forth on Exhibit A hereto with respect to each Mortgage Loan set
forth on the related Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian from and after the Closing Date.
The Seller shall or shall cause the Interim Servicer to forward to
the Custodian, or to such other Person as the Purchaser shall designate in
writing, original documents evidencing an assumption, modification,
consolidation or extension of any Mortgage Loan entered into in accordance with
this Agreement within two (2) weeks of their execution, provided, however, that
the Seller shall provide the Custodian, or to such other Person as the Purchaser
shall designate in writing, with a certified true copy of any such document
submitted for recordation within two (2) weeks of its execution, and shall
promptly provide the original of any document submitted for recordation or a
copy of such document certified by the appropriate public recording office to be
a true and complete copy of the original within ninety (90) days of its
submission for recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within ninety (90) days following the Closing Date
(other than with respect to the Assignments of Mortgage which shall be delivered
to the Custodian in blank and recorded subsequently by the Purchaser or its
designee), and in the event that the Seller does not cure such failure within
thirty (30) days of discovery or receipt of written notification of such failure
from the Purchaser, the related Mortgage Loan shall, upon the request of the
Purchaser, be repurchased by the Seller at the price and in the manner specified
in Subsection 9.03. The foregoing repurchase obligation shall not apply in the
event that the Seller cannot deliver such original or copy of any document
submitted for recordation to the appropriate public recording office within the
specified period due to a delay caused by the recording office in the applicable
jurisdiction, provided that (i) the Seller shall deliver a recording receipt of
such recording office or, if such recording receipt is not available, an
officer's certificate of a servicing officer of the Seller, confirming that such
documents have been accepted for recording (upon request of the Purchaser and
delivery by the Purchaser to the Seller of a schedule of the related Mortgage
Loans, the Seller shall reissue and deliver to the Purchaser or its designee
said officer's certificate relating to the related Mortgage Loans), and (ii)
such document is delivered within twelve (12) months of the related Closing
Date.
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs for a one-time transfer of
all original documents to the Custodian or, upon written request of the
Purchaser, to the Purchaser or the Purchaser's designee. The Purchaser, or the
Purchaser's designee, shall be responsible for recording any Assignments of
Mortgage and shall be reimbursed by the Seller for the costs associated
therewith pursuant to the preceding sentence.
Subsection 6.04. Quality Control Procedures.
The Seller shall, or shall cause the Interim Servicer to, have an
internal quality control program that verifies in a manner consistent with
accepted industry procedures, on a regular basis, the existence and accuracy of
the legal documents, credit documents, property appraisals, and underwriting
decisions. The program shall include evaluating and monitoring the overall
quality of the Seller's loan production and the servicing activities of the
Interim Servicer. The program is to ensure that the Mortgage Loans are
originated and serviced in accordance with Accepted Servicing Practices and the
Underwriting Guidelines; guard against dishonest, fraudulent, or negligent acts;
and guard against errors and omissions by officers, employees, or other
authorized persons.
Subsection 6.05. MERS Designated Mortgage Loans.
With respect to each MERS Designated Mortgage Loan, the Seller
shall, on or prior to the related Closing Date, designate the Purchaser as the
Investor and the Custodian as custodian, and, no later than one Business Day
following the related Closing Date, no Person shall be listed as Interim Funder
on the MERS System. In addition, no later than one Business Day following the
related Closing Date, Seller shall provide the Custodian and the Purchaser with
a MERS Report listing the Purchaser as the Investor, the Custodian as custodian
and no Person as Interim Funder with respect to each MERS Designated Mortgage
Loan.
SECTION 7. Servicing of the Mortgage Loans.
The Mortgage Loans have been sold by the Seller to the Purchaser on
a servicing released basis. Subject to, and upon the terms and conditions of
this Agreement and the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Seller hereby
sells, transfers, assigns, conveys and delivers to the Purchaser the Servicing
Rights.
The Purchaser shall retain the Interim Servicer as contract servicer
of the Mortgage Loans for an interim period pursuant to and in accordance with
the terms and conditions contained in the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Except as set forth in the Interim Servicing Agreement, the Interim Servicer
shall service the Mortgage Loans on an "actual/actual" basis and otherwise in
material compliance with Accepted Servicing Practices. The Purchaser and Seller
shall cause the Interim Servicer to execute the Interim Servicing Agreement on
the initial Closing Date.
Pursuant to the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Interim
Servicer shall begin servicing the Mortgage Loans on behalf of the Purchaser and
shall be entitled to a Servicing Fee with respect to such Mortgage Loans until
the applicable Transfer Date. The Interim Servicer shall conduct such servicing
in accordance with the Interim Servicing Agreement.
SECTION 8. Transfer of Servicing.
On the applicable Transfer Date, the Purchaser, or its designee,
shall assume all servicing responsibilities related to, and the Seller shall
cause the Interim Servicer to cease all servicing responsibilities related to,
the related Mortgage Loans subject to such Transfer Date. The Transfer Date
shall be the date determined in accordance with Section 6.02 of the Interim
Servicing Agreement (with respect to each Mortgage Loan, for an interim period,
as specified therein).
On or prior to the applicable Transfer Date, or such later date
provided for below, the Seller shall, at its sole cost and expense, take such
steps as may be necessary or appropriate to effectuate and evidence the transfer
of the servicing of the related Mortgage Loans to the Purchaser, or its
designee, including but not limited to the following:
(a) Notice to Mortgagors. The Seller shall cause the Interim
Servicer to mail to the Mortgagor of each related Mortgage Loan a letter
advising such Mortgagor of the transfer of the servicing of the related Mortgage
Loan to the Purchaser, or its designee, in accordance with the Xxxxxxxx Xxxxxxxx
National Affordable Housing Act of 1990; provided, however, the content and
format of the letter shall have the prior approval of the Purchaser, such
approval not to be unreasonably withheld. The Seller shall cause the Interim
Servicer to provide the Purchaser with copies of all such related notices within
five Business Days following the related Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The Seller
shall cause the Interim Servicer to transmit to the applicable taxing
authorities and insurance companies (including primary mortgage insurance policy
insurers, if applicable) and/or agents, notification of the transfer of the
servicing to the Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may be, to the
Purchaser from and after the Transfer Date. The Seller shall cause the Interim
Servicer to provide the Purchaser with copies of all such notices within five
Business Days following the related Transfer Date.
(c) Delivery of Servicing Records. Within five Business Days
following the related Transfer Date, the Seller shall cause the Interim Servicer
to forward to the Purchaser, or its designee, all servicing records and the
Servicing File in the Interim Servicer's possession relating to each related
Mortgage Loan including the information enumerated in the Interim Servicing
Agreement (with respect to each such Mortgage Loan, for an interim period, as
specified therein).
(d) Escrow Payments. Within five Business Days following the related
Transfer Date, the Seller shall cause the Interim Servicer to provide the
Purchaser, or its designee, with immediately available funds by wire transfer in
the amount of the net Escrow Payments and suspense balances and all loss draft
balances associated with the related Mortgage Loans. Within five Business Days
following the related Transfer Date, the Seller shall cause the Interim Servicer
to provide the Purchaser with an accounting statement, in electronic format
acceptable to the Purchaser in its sole discretion, of Escrow Payments and
suspense balances and loss draft balances sufficient to enable the Purchaser to
reconcile the amount of such payment with the accounts of the Mortgage Loans.
Additionally, the Seller shall, within five Business Days following the related
Transfer Date, cause the Interim Servicer to wire transfer to the Purchaser the
amount of any agency, trustee or prepaid Mortgage Loan payments and all other
similar amounts held by the Interim Servicer.
(e) Payoffs and Assumptions. Within five Business Days following the
related Transfer Date, the Seller shall cause the Interim Servicer to provide to
the Purchaser, or its designee, copies of all assumption and payoff statements
generated by the Interim Servicer on the related Mortgage Loans from the related
Cut-off Date to the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Interim Servicer or the Seller on
each related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of
any related Monthly Payments received by the Seller after the Transfer Date
shall be forwarded to the Purchaser by overnight mail on the date of receipt.
The Seller shall notify the Purchaser of the particulars of the payment, which
notification requirement shall be satisfied if the Seller forwards with its
payment sufficient information to permit appropriate processing of the payment
by the Purchaser. The Seller shall assume full responsibility for the necessary
and appropriate legal application of such Monthly Payments received by the
Seller after the Transfer Date with respect to related Mortgage Loans then in
foreclosure or bankruptcy; provided, for purposes of this Agreement, necessary
and appropriate legal application of such Monthly Payments shall include, but
not be limited to, endorsement of a Monthly Payment to the Purchaser with the
particulars of the payment such as the account number, dollar amount, date
received and any special Mortgagor application instructions and the Seller shall
cause the Interim Servicer to comply with the foregoing requirements with
respect to all Monthly Payments received by the Interim Servicer after the
Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication errors;
(ii) The party receiving notice of a misapplied payment occurring
prior to the applicable Transfer Date and discovered after the Transfer
Date shall immediately notify the other party;
(iii) If a misapplied payment which occurred prior to the Transfer
Date cannot be identified and said misapplied payment has resulted in a
shortage in a Custodial Account or Escrow Account, the Seller shall be
liable for the amount of such shortage. The Seller shall reimburse the
Purchaser for the amount of such shortage within thirty (30) days after
receipt of written demand therefor from the Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer
Date has created an improper Purchase Price as the result of an inaccurate
outstanding principal balance, a check shall be issued to the party
shorted by the improper payment application within five (5) Business Days
after notice thereof by the other party; and
(v) Any check issued under the provisions of this Section 8(h) shall
be accompanied by a statement indicating the corresponding Seller and/or
the Purchaser Mortgage Loan identification number and an explanation of
the allocation of any such payments.
(i) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be in
accordance with all applicable Purchaser requirements as set forth in this
Agreement.
(j) Reconciliation. The Seller shall, on or before the Transfer
Date, reconcile principal balances and make any monetary adjustments required by
the Purchaser in accordance with this Agreement. Any such monetary adjustments
will be transferred between the Seller and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer
to file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be
filed on or before the Transfer Date in relation to the servicing and ownership
of the related Mortgage Loans. The Seller shall provide copies of such forms to
the Purchaser upon request and shall reimburse the Purchaser for any costs or
penalties incurred by the Purchaser due to the Seller's failure to comply with
this paragraph.
SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 9.01. Representations and Warranties Regarding the
Seller.
The Seller represents, warrants and covenants to the Purchaser that
as of the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
California and has all licenses necessary to carry on its business as now being
conducted and is licensed, qualified and in good standing in each state wherein
it owns or leases any material properties or where a Mortgaged Property is
located, if the laws of such state require licensing or qualification in order
to conduct business of the type conducted by the Seller, and in any event the
Seller is in compliance with the laws of any such state to the extent necessary
to ensure the enforceability of the related Mortgage Loan and the servicing of
such Mortgage Loan in accordance with the terms of this Agreement and the
Interim Servicing Agreement; the Seller has the full corporate power, authority
and legal right to hold, transfer and convey the Mortgage Loans and to execute
and deliver this Agreement and to perform its obligations hereunder and
thereunder; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Seller and the consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized; this Agreement and all agreements
contemplated hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Seller, regardless of
whether such enforcement is sought in a proceeding in equity or at law, subject
to bankruptcy, insolvency, and similar laws affecting the rights of creditors
generally and to general principles of equity; and all requisite corporate or
other action has been taken by the Seller to make this Agreement and all
agreements contemplated hereby valid and binding upon the Seller in accordance
with their terms;
(b) Ordinary Course of Business. The consummation of the
transactions contemplated by this Agreement are in the ordinary course of
business of the Seller, and the transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages by the Seller pursuant to this Agreement are
not subject to the bulk transfer or any similar statutory provisions in effect
in any applicable jurisdiction;
(c) No Conflicts. Neither the execution and delivery of this
Agreement, the acquisition or origination of the Mortgage Loans by the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation of the
transactions contemplated hereby and thereby, nor the fulfillment of or
compliance with the terms and conditions of this Agreement, will conflict with
or result in a breach of any of the terms, conditions or provisions of the
Seller's charter, by-laws or other organizational documents or any legal
restriction or any agreement or instrument to which the Seller is now a party or
by which it is bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Seller or its property is subject, or
result in the creation or imposition of any lien, charge or encumbrance that
would have an adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument, or impair the ability
of the Purchaser to realize on the Mortgage Loans, impair the value of the
Mortgage Loans, or impair the ability of the Purchaser to realize the full
amount of any insurance benefits accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer 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 OTS, the OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller 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 Interim
Servicer, for accounting and tax purposes, as compensation for the servicing and
administration of the Mortgage Loans pursuant to this Agreement and the Interim
Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller does not believe, nor
does it have any reason or cause to believe, that it cannot perform each and
every covenant contained in this Agreement. The Seller is solvent and the sale
of the Mortgage Loans will not cause the Seller to become insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of Seller's creditors;
(g) No Litigation Pending. Except as disclosed in filings with the
Securities Exchange Commission by the Seller or its Affiliates, there is no
action, suit, proceeding or investigation pending or threatened against the
Seller, before any court, administrative agency or other tribunal asserting the
invalidity of this Agreement, seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or which, either in any one instance
or in the aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Seller contemplated herein, or which
would be likely to impair the ability of the Seller to perform under the terms
of this Agreement;
(h) No Consent Required. No consent, approval, authorization or
order of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is
required for the execution, delivery and performance by the Seller of or
compliance by the Seller with this Agreement or the Mortgage Loans, the delivery
of a portion of the Mortgage Files to the Custodian or the sale of the Mortgage
Loans or the consummation of the transactions contemplated by this Agreement, or
if required, such consent, approval, authorization or order of, or registration
or filing with, or notice has been obtained prior to the need therefore;
(i) Selection Process. The Mortgage Loans were selected from among
the outstanding one- to four-family mortgage loans in the Seller's portfolio at
the related Closing Date as to which the representations and warranties set
forth in Subsection 9.02 could be made and such selection was not made on behalf
of the Seller in a manner so as to affect adversely the interests of the
Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of
the related Mortgage Loan Package are as set forth on the description of the
pool characteristics for the applicable Mortgage Loan Package delivered pursuant
to Section 11 on the related Closing Date in the form attached as Exhibit B to
each related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any
information, statement, tape, diskette, report, form, or other document
furnished or to be furnished by Seller pursuant to this Agreement or any
Reconstitution Agreement or in connection with the transactions contemplated
hereby (including any Securitization Transaction or Whole Loan Transfer)
contains or will contain any untrue statement of material fact or omits or will
omit to state a material fact necessary to make the statements contained herein
or therein not misleading;
(l) Financial Statements. Any financial statements delivered
pursuant to Section 15 fairly present the pertinent results of operations and
changes in financial position for each of such periods and the financial
position at the end of each such period of the Seller and its subsidiaries and
have been prepared in accordance with generally accepted accounting principles
of the United States consistently applied throughout the periods involved,
except as set forth in the notes thereto. Except as disclosed in filings with
the Securities Exchange Commission by the Seller or its Affiliates, there has
been no change in the business, operations, financial condition, properties or
assets of the Seller since the date of the Seller's financial statements most
recently delivered to Purchaser that would have an adverse effect on its ability
to perform its obligations under this Agreement;
(m) No Brokers. The Seller has not dealt with any broker, investment
banker, agent or other person that may be entitled to any commission or
compensation in connection with the sale of the Mortgage Loans;
(n) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes;
(o) Reasonable Purchase Price. The consideration received by the
Seller upon the sale of the Mortgage Loans under this Agreement constitutes fair
consideration and reasonably equivalent value for the Mortgage Loans;
(p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note (other than for
each MERS Designated Mortgage Loan), and upon the sale of the Mortgage Loans to
the Purchaser, the Seller will retain the Mortgage Files with respect thereto in
trust only for the purpose of servicing and supervising the servicing of each
Mortgage Loan;
(q) Seller's Origination. The Seller's decision to originate any
mortgage loan or to deny any mortgage loan application is an independent
decision based upon Seller's underwriting guidelines, and is in no way made as a
result of Purchaser's decision to purchase, or not to purchase, or the price
Purchaser may offer to pay for, any such mortgage loan, if originated;
(r) Compliance with Anti-Money Laundering Laws. The Seller has
complied with all applicable anti-money laundering laws, regulations and
executive orders, including without limitation the USA Patriot Act of 2001
(collectively, the "Anti-Money Laundering Laws");
(s) Delivery to the Custodian. The Mortgage Note, the Mortgage, any
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to this Agreement shall be delivered to
the Custodian or as otherwise instructed by the Purchaser all in compliance with
the specific requirements of this Agreement. With respect to each Mortgage Loan,
the Seller will be in possession of a complete Mortgage File in compliance with
Exhibit A hereto, except for such documents as will be delivered to the
Custodian or as otherwise instructed by the Purchaser; and
(t) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan will fully furnish, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files to
Equifax, Experian and Trans Union Credit Information Company (three of the
credit repositories), on a monthly basis.
Subsection 9.02. Representations and Warranties Regarding Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that, as
to each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule and in the Points Schedule is complete, true and correct;
(b) Payments Current. As of the Closing Date, no payment required
under the Mortgage Loan is thirty (30) days or more delinquent nor has any
payment under the Mortgage Loan been thirty (30) days or more delinquent at any
time since the origination of the Mortgage Loan. The first Monthly Payment due
to the Purchaser shall be made with respect to the Mortgage Loan within the
calendar month in which its Due Date occurs and prior to the Due Date next
occurring for such Mortgage Loan;
(c) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage securing the Mortgage Loan, 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 an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Except for (A) payments in the nature
of escrow payments and (B) interest accruing from the date of the Mortgage Note
or date of disbursement of the Mortgage Loan proceeds, whichever is earlier to
the day which precedes by one (1) month the Due Date of the first installment of
principal and interest, including, without limitation, taxes and insurance
payments, the Seller has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination except by a written instrument which has been
recorded, if necessary to protect the interests of the Purchaser, and which has
been delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. No
Mortgagor has been released, in whole or in part, except in connection with an
assumption agreement, approved by the title insurer, to the extent required by
the policy, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) No Defenses. The Mortgage Loan is 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 either the
Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject to
any right of rescission, set-off, counterclaim or defense, including without
limitation the defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was funded;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement. If required by the National Flood Insurance Act
of 1968, as amended, each Mortgage Loan is covered by a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration in effect, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement. All individual insurance
policies contain a standard mortgagee clause naming the Seller and its
successors and assigns as mortgagee, and all premiums currently due thereon have
been paid and such policies may not be reduced, terminated or cancelled without
thirty (30) days' prior written notice to the mortgagee. The Mortgage obligates
the Mortgagor thereunder to maintain the hazard insurance policy at the
Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
such Mortgagor's cost and expense, and to seek reimbursement therefor from the
Mortgagor. Where required by state law or regulation, the Mortgagor has been
given an opportunity to choose the carrier of the required hazard insurance,
provided the policy is not a "master" or "blanket" hazard insurance policy
covering a condominium, or any hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy is the
valid and binding obligation of the insurer, is in full force and effect, and
will be in full force and effect and inure to the benefit of the Purchaser upon
the consummation of the purchase transactions contemplated by this Agreement.
The Seller has not engaged in, and has no knowledge of the Mortgagor's or any
servicer's having engaged in, any act or omission which would impair the
coverage of any such policy, the benefits of the endorsement provided for
herein, or the validity and binding effect of such policy, including, without
limitation, no unlawful fee, commission, kickback or other unlawful compensation
or value of any kind has been or will be received, retained or realized by any
attorney, firm or other person or entity, and no such unlawful items have been
received, retained or realized by the Seller;
(g) Compliance with Applicable Laws. (i) 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,
predatory, abusive and fair lending, equal credit opportunity and disclosure
laws applicable to the Mortgage Loan, including, without limitation, any
provisions relating to prepayment penalties, have been complied with, (ii) the
consummation of the transactions contemplated hereby will not involve the
violation of any such laws or regulations, and (iii) the Seller shall maintain
in its possession, available for the Purchaser's inspection, and shall deliver
to the Purchaser upon demand, evidence of compliance with all such requirements.
Clause (i) of this representation and warranty is a Deemed Material Breach
Representation;
(h) No Satisfaction of Mortgage. The Mortgage has not been
satisfied, canceled, subordinated (except to a senior mortgage in the case of a
Second Lien Loan) or rescinded, in whole or in part, and the Mortgaged Property
has not been released from the lien of the Mortgage, in whole or in part, nor
has any instrument been executed that would effect any such release,
cancellation, subordination or rescission. The Seller 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
Seller waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property
is a fee simple property located in the state identified in the related Mortgage
Loan Schedule, except that with respect to real property located in
jurisdictions in which the use of leasehold estates for residential properties
is a widely-accepted practice, the Mortgaged Property may be a leasehold estate,
and consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a condominium project, or an individual unit in
a planned unit development; provided, however, that no residence or dwelling is
a mobile home and any condominium unit or planned unit development shall not
fall within any of the "Ineligible Projects" of part XII, Section 102 of the
Xxxxxx Xxx Selling Guide and shall conform with the Underwriting Guidelines. In
the case of any Mortgaged Properties that are manufactured homes (a
"Manufactured Home Mortgage Loans"), (i) such Manufactured Home Mortgage Loan
conforms with the applicable Xxxxxx Mae or Xxxxxxx Mac requirements regarding
mortgage loans related to manufactured dwellings, (ii) the related manufactured
dwelling is permanently affixed to the land, (iii) the related manufactured
dwelling and the related land are subject to a Mortgage properly filed in the
appropriate public recording office and naming Seller as mortgagee, (iv) the
applicable laws of the jurisdiction in which the related Mortgaged Property is
located will deem the manufactured dwelling located on such Mortgaged Property
to be a part of the real property on which such dwelling is located, (v) as of
the origination date of the related Manufactured Home Mortgage Loan, the related
manufactured housing unit that secures such Mortgage Loan either (x) was the
principal residence of the related Mortgagor or (y) was classified as real
property under applicable state law, and (vi) such Manufactured Home Mortgage
Loan is (x) a qualified mortgage under Section 860G(a)(3) of the Internal
Revenue Code of 1986, as amended, and (y) secured by manufactured housing
treated as a single family residence under Section 25(e)(10) of the Code. As of
the date of origination, no portion of the Mortgaged Property was used for
commercial purposes, and since the date of origination, no portion of the
Mortgaged Property has been used for commercial purposes; provided, that
Mortgaged Properties which contain a home office shall not be considered as
being used for commercial purposes as long as the Mortgaged Property has not
been altered for commercial purposes and is not storing any chemicals or raw
materials other than those commonly used for homeowner repair, maintenance
and/or household purposes. Clause (v) of this representation and warranty is a
Deemed Material Breach Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements on
the Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to such
buildings, and all additions, alterations and replacements made at any time,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. In no event shall any Mortgage Loan be
in a lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the
first mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and
assessments not yet due and payable;
(3) covenants, conditions and restrictions, rights of
way, easements and other matters of the public record as of
the date of recording acceptable to prudent mortgage lending
institutions generally and specifically referred to in the
lender's title insurance policy delivered to the originator of
the Mortgage Loan and (a) specifically referred to or
otherwise considered in the appraisal made for the originator
of the Mortgage Loan or (b) which do not adversely affect the
Appraised Value of the Mortgaged Property set forth in such
appraisal; and
(4) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of
the security intended to be provided by the Mortgage or the
use, enjoyment, value or marketability of the related
Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable (subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity) and
perfected (A) first lien and first priority security interest with respect to
each First Lien Loan, or (B) second lien and second priority security interest
with respect to each Second Lien Loan, in either case, on the property described
therein and Seller has full right to sell and assign the same to Purchaser. With
respect to each Second Lien Loan, the Mortgaged Property was not, as of the date
of origination of such Second Lien Loan, subject to a mortgage, deed of trust,
deed to secure debt or other security instrument creating a lien subordinate to
the lien of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage and any other agreement executed and delivered by a Mortgagor or
guarantor, if applicable, in connection with a Mortgage Loan are genuine, and
each is the legal, valid and binding obligation of the maker thereof enforceable
in accordance with its terms, subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity (including,
without limitation, any provisions therein relating to Prepayment Charges). All
parties to the Mortgage Note, the Mortgage and any other such related agreement
had legal capacity to enter into the Mortgage Loan and to execute and deliver
the Mortgage Note, the Mortgage and any other related agreement, and the
Mortgage Note, the Mortgage and any other such related agreement have been duly
and properly executed by other such related parties. The documents, instruments
and agreements submitted for loan underwriting were not falsified and contain no
untrue statement of material fact or omit to state a material fact required to
be stated therein or necessary to make the information and statements therein
not misleading. No fraud, error, omission, misrepresentation, negligence or
similar occurrence with respect to a Mortgage Loan has taken place on the part
of any Person, including without limitation, the Mortgagor, any appraiser, any
builder or developer, or any other party involved in the origination or
servicing of the Mortgage Loan. The Seller has reviewed all of the documents
constituting the Servicing File and has made such inquiries as it deems
necessary to make and confirm the accuracy of the representations set forth
herein;
(l) Full Disbursement of Proceeds. Except to the extent the Mortgage
Loan is subject to completion escrows which have been disclosed to and
acknowledged by the Purchaser and which meet the requirements of the
Underwriting Guidelines and as to which a completed Xxxxxx Xxx Form 442 has been
delivered to the Purchaser within sixty (60) days after the related Closing
Date, the Mortgage Loan has been closed and 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 improvement and as to disbursements of any escrow funds therefor have
been complied with. All costs, fees and expenses incurred in making or closing
the Mortgage Loan and the recording of the Mortgage were paid, and the Mortgagor
is not entitled to any refund of any amounts paid or due under the Mortgage Note
or Mortgage;
(m) Ownership. The Seller or MERS is the sole owner of record and
holder of the Mortgage Loan and the indebtedness evidenced by each Mortgage Note
and upon the sale of the Mortgage Loans to the Purchaser, the Seller will retain
the Mortgage Files or any part thereof with respect thereto not delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan. Except
for the lien of the Seller's warehouse lender, which lien will be released upon
payment of the related Purchase Price, the Mortgage Loan is not assigned or
pledged, and the Seller has good, indefeasible and marketable title thereto, and
has full right to transfer and sell the Mortgage Loan to the Purchaser free and
clear of any encumbrance, equity, participation interest, lien, pledge, charge,
claim or security interest, and has full right and authority subject to no
interest or participation of, or agreement with, any other party, to sell and
assign each Mortgage Loan pursuant to this Agreement and following the sale of
each 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 related to the Seller. The Seller intends to relinquish all
rights to possess, control and monitor the Mortgage Loan. After the Closing
Date, the Seller will have no right to modify or alter the terms of the sale of
the Mortgage Loan and the Seller will have no obligation or right to repurchase
the Mortgage Loan or substitute another Mortgage Loan, except as provided in
this Agreement;
(n) Doing Business. All parties which have had any interest in the
Mortgage Loan, whether as mortgagee, assignee, pledgee or otherwise, are (or,
during the period in which they held and disposed of such interest, were) (1) in
compliance with any and all applicable licensing requirements of the laws of the
state wherein the Mortgaged Property is located, and (2) either (i) organized
under the laws of such state, or (ii) qualified to do business, or exempt from
such qualification, in such state, or (iii) a federal savings and loan
association, a savings bank or a national bank having a principal office in such
state, or (3) not doing business in such state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien
Loan has a CLTV in excess of 100%. No Mortgage Loan has an LTV greater than
100%. At origination of the Mortgage Loan, the Mortgagor did not have a FICO
score of less than 500;
(p) Title Insurance. The 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 Xxxxxxx Mac and each such title insurance
policy is issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and
qualified to do business in the jurisdiction where the Mortgaged Property is
located, insuring the Seller, its successors and assigns, as to the first
priority lien (with respect to First Lien Loans) or second priority lien (with
respect to Second Lien Loans) of the Mortgage in the original principal amount
of the Mortgage Loan, subject only to the exceptions contained in clauses (1),
(2) and (3) of paragraph (j) of this Subsection 9.02, and in the case of
Adjustable Rate Mortgage Loans, against any loss by reason of the invalidity or
unenforceability of the lien resulting from the provisions of the Mortgage
providing for adjustment to 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.
Additionally, such lender's title insurance policy affirmatively insures ingress
and egress, and against encroachments by or upon the Mortgaged Property or any
interest therein. The title policy does not contain any special exceptions
(other than the standard exclusions) for zoning and uses and has been marked to
delete the standard survey exception or to replace the standard survey exception
with a specific survey reading. The Seller, its successor and assigns, are the
sole insureds of such lender's title insurance policy, and such lender's title
insurance policy is valid and remains in full force and effect and will be in
force and effect upon the consummation of the purchase transactions contemplated
by this Agreement. No claims have been made under such lender's title insurance
policy, and no prior holder of the related Mortgage, including the Seller, has
done, by act or omission, anything which would impair the coverage of such
lender's title insurance policy, including without limitation, no unlawful fee,
commission, kickback or other unlawful compensation or value of any kind has
been or will be received, retained or realized by any attorney, firm or other
person or entity, and no such unlawful items have been received, retained or
realized by the Seller;
(q) No Defaults. Other than payments due but not yet thirty (30)
days or more delinquent, there is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage Note and
no event which, with the passage of time or with notice and the expiration of
any grace or cure period, would constitute a default, breach, violation or event
which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note and (iii) there is no event which,
with the passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law or the related Mortgage requires, the mortgagee under the
Second Lien Loan to receive notice of, and affords such mortgagee an opportunity
to cure any default by payment in full or otherwise under the prior mortgage;
(r) No Mechanics' Liens. Except as insured against by the related
title insurance, 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
the law could give rise to such liens) affecting the related Mortgaged Property
which are or may be liens prior to, or equal or coordinate with, the lien of the
related Mortgage;
(s) Location of Improvements; No Encroachments. All improvements
which were considered in determining the Appraised Value of the Mortgaged
Property lay wholly within the boundaries and building restriction lines of the
Mortgaged Property, and no improvements on adjoining properties encroach upon
the Mortgaged Property. The Mortgaged Property and all improvements located on
or being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
(t) Origination; Payment Terms. 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 Act, a savings and loan association, a savings
bank, a commercial bank, credit union, insurance company or other similar
institution which is supervised and examined by a federal or state authority.
The documents, instruments and agreements submitted for loan underwriting were
not falsified and contain no untrue statement of material fact or omit to state
a material fact required to be stated therein or necessary to make the
information and statements therein not misleading. No Mortgage Loan contains
terms or provisions which would result in negative amortization. Principal or
interest payments on the Mortgage Loan commenced or will commence no more than
sixty (60) days after funds were disbursed in connection with the Mortgage Loan.
The Mortgage Interest Rate as well as, with respect to Adjustable Rate Mortgage
Loans, the Lifetime Rate Cap, the Periodic Rate Floor and the Periodic Rate Cap
are as set forth on the related Mortgage Loan Schedule. The Mortgage Interest
Rate is required to be adjusted, with respect to Adjustable Rate Mortgage Loans,
on each Interest Rate Adjustment Date to equal the Index plus the Gross Margin
(rounded up or down to the nearest 0.125%), subject to the Periodic Rate Cap,
the Periodic Rate Floor and the Lifetime Rate Cap. Subject to a "balloon"
payment in the case of a Balloon Mortgage Loan, the Mortgage Note is payable in
equal monthly installments of principal and/or interest, which installments are
subject to change due to adjustments to the Mortgage Interest Rate and/or
Monthly Payment on each Interest Rate Adjustment Date or Monthly Payment
Adjustment Date, with interest calculated and payable in arrears, sufficient to
amortize the Mortgage Loan fully by the stated maturity date (unless the
Mortgage Loan is identified on the Mortgage Loan Schedule as a Balloon Mortgage
Loan), over an original term of not more than thirty (30) years from
commencement of amortization. Unless otherwise specified on the related Mortgage
Loan Schedule, the Mortgage Loan is payable on the first day of each month.
There are no Convertible Mortgage Loans which contain a provision allowing the
Mortgagor to convert the Mortgage Note from an adjustable interest rate Mortgage
Note to a fixed interest rate Mortgage Note. The Due Date of the first payment
under the Mortgage Note is no more than sixty (60) days from the date of the
Mortgage Note;
(u) Customary Provisions. The Mortgage contains customary and
enforceable provisions (subject to bankruptcy, insolvency, and similar laws
affecting the rights of creditors and general principles of equity) 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, (i) in the case of a Mortgage designated as a deed
of trust, by trustee's sale, and (ii) otherwise by judicial foreclosure. Upon
default by a Mortgagor on a Mortgage Loan and foreclosure on, or trustee's sale
of, the Mortgaged Property pursuant to the proper procedures, the holder of the
Mortgage Loan will be able to deliver good and merchantable title to the
Mortgaged Property. There is no homestead or other exemption available to a
Mortgagor which would interfere with the right to sell the Mortgaged Property at
a trustee's sale or the right to foreclose the Mortgage, subject to applicable
federal and state laws and judicial precedent with respect to bankruptcy and
right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The
Mortgage Loan was underwritten in accordance with the related Underwriting
Guidelines (a copy of which is attached to the related Assignment and Conveyance
Agreement as Exhibit C). The Mortgage Note and Mortgage are on forms acceptable
in the secondary mortgage market and no representations have been made to a
Mortgagor that are inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the related Closing
Date the Mortgaged Property is capable of being lawfully occupied under
applicable law. All inspections, licenses and certificates required to be made
or issued with respect to all occupied portions of the Mortgaged Property and,
with respect to the use and occupancy of the same, including but not limited to
certificates of occupancy and fire underwriting certificates, have been made or
obtained from the appropriate authorities. The Seller has not received
notification from any Governmental Authority that the Mortgaged Property is in
material non-compliance with such laws or regulations, is being used, operated
or occupied unlawfully or has failed to have or obtain such inspection, licenses
or certificates, as the case may be. The Seller has not received notice of any
violation or failure to conform with any such law, ordinance, regulation,
standard, license or certificate. If the Mortgage Loan is identified as
"owner-occupied" in the related Mortgage Loan Schedule, the Mortgagor
represented at the time of origination of the Mortgage Loan that the Mortgagor
would occupy the Mortgaged Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The 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 in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. To the Seller's knowledge, there are no
circumstances or conditions with respect to the Mortgage, the Mortgaged
Property, the Mortgagor, the Mortgage File or the Mortgagor's credit standing
that can reasonably be expected to cause private institutional investors who
invest in mortgage loans similar to the Mortgage Loan to regard the Mortgage
Loan as an unacceptable investment, cause the Mortgage Loan to become
delinquent, or adversely affect the value or marketability of the Mortgage Loan,
or cause the Mortgage Loan to prepay during any period materially faster or
slower than the mortgage loans originated by the Seller generally except for the
non-prime nature of the Mortgage Loans and the related Mortgagor's credit. No
Mortgaged Property is located in a state, city, county or other local
jurisdiction as described in the related Purchase Price and Terms Agreement
which the Purchaser has determined in its reasonable good faith discretion would
cause the related Mortgage Loan to be ineligible for whole loan sale or
securitization in a transaction consistent with the prevailing sale and
securitization industry (including, without limitation, the practice of the
rating agencies) with respect to substantially similar mortgage loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the
Mortgage, the Assignment of Mortgage, if any, and any other documents required
to be delivered to the Custodian under this Agreement for each Mortgage Loan
have been delivered to the Custodian. The Seller is in possession of a complete,
true and accurate Mortgage File in compliance with Exhibit A hereto, except for
such documents the originals of which have been delivered to the Custodian, and
the Seller has retained copies thereof;
(bb) Condominiums/Planned Unit Developments. If the Mortgaged
Property is a condominium unit or a planned unit development (other than a de
minimis planned unit development) such condominium or planned unit development
project is in conformance with the related Underwriting Guidelines;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Seller are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision (subject to applicable law) for the
acceleration of the payment of the unpaid principal balance of the Mortgage Loan
in the event that the Mortgaged Property is sold or transferred without the
prior written consent of the mortgagee thereunder;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Seller has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to
the Mortgagor prior to the applicable Cut-off Date have been consolidated with
the outstanding principal amount secured by the Mortgage, and the secured
principal amount, as consolidated, bears a single interest rate and single
repayment term. The lien of the Mortgage securing the consolidated principal
amount is expressly insured as having first or second, as applicable, lien
priority by a title insurance policy, an endorsement to the policy insuring the
mortgagee's consolidated interest or by other title evidence acceptable to
Xxxxxx Xxx and Xxxxxxx Mac. The consolidated principal amount does not exceed
the original principal amount of the Mortgage Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. The
Mortgaged Property is undamaged by waste, fire, earthquake or earth movement,
windstorm, flood, tornado or other casualty so as to affect adversely the value
of the Mortgaged Property as security for the Mortgage Loan or the use for which
the premises were intended and each Mortgaged Property is in good repair. There
have not been any condemnation proceedings with respect to the Mortgaged
Property. Additionally, there is no proceeding pending for the total or partial
condemnation of the Mortgaged Property and the Seller has no knowledge of any
such proceedings in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate
Adjustments. The origination, servicing and collection practices with respect to
the Mortgage Loan have been in all respects in compliance with Accepted
Servicing Practices, applicable laws and regulations, and have been in all
respects legal and proper. With respect to escrow deposits and Escrow Payments
(other than with respect to Second Lien Loans for which the mortgagee under the
prior mortgage lien is collecting Escrow Payments), all such payments are in the
possession of Seller and there exist no deficiencies in connection therewith for
which customary arrangements for repayment thereof have not been made. Each
Mortgage Loan is covered by a paid in full, life of loan, tax service contract
that will be assigned without penalty, premium or cost to the Purchaser. All
Escrow Payments have been collected in full compliance with state and federal
law and the provisions of the related Mortgage Note and Mortgage. An escrow of
funds is not prohibited by applicable law and, if established for the Mortgage
Loan, has been established in an amount sufficient to pay for every item that
remains unpaid and has been assessed but is not yet due and payable. No escrow
deposits or Escrow Payments or other charges or payments due the Seller have
been capitalized under the Mortgage or the Mortgage Note. All Mortgage Interest
Rate adjustments have been made in strict compliance with state and federal law
and the terms of the related Mortgage and Mortgage Note on the related Interest
Rate Adjustment Date. If, pursuant to the terms of the Mortgage Note, another
index was selected for determining the Mortgage Interest Rate, the same index
was used with respect to each Mortgage Note which required a new index to be
selected, and such selection did not conflict with the terms of the related
Mortgage Note. Any and all notices required under applicable law and the terms
of the related Mortgage Note and Mortgage regarding the Mortgage Interest Rate
and the Monthly Payment adjustments have been delivered. Any interest required
to be paid by the Seller to the Mortgagor pursuant to state, federal and local
law has been properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan fits within the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has existed on or
prior to the related Closing Date that has resulted or will result in the
exclusion from, denial of, or defense to coverage under any applicable primary
mortgage insurance policy, hazard insurance policy or bankruptcy bond
(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), irrespective of the cause of such
failure of coverage. The Seller has caused or, before or in connection with the
transfer of servicing, will cause to be performed any and all acts required to
preserve the rights and remedies of the Purchaser in any insurance policies
applicable to the Mortgage Loans including, without limitation, any necessary
notifications of insurers, assignments of policies or interests therein, and
establishments of coinsured, joint loss payee and mortgagee rights in favor of
the Purchaser. In connection with the placement of any such insurance, no
commission, fee, or other compensation has been or will be received by the
Seller or by any officer, director, or employee of the Seller or any designee of
the Seller or any corporation in which the Seller or any officer, director, or
employee had a financial interest at the time of placement of such insurance;
(ll) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not
notified the Seller, and the Seller has no knowledge of any relief requested or
allowed to the Mortgagor under the Servicemembers' Civil Relief Act of 1940, as
amended, or any similar state statute;
(nn) Appraisal. The Seller has delivered to the Purchaser an
appraisal of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser who (i) was licensed in the state where the
Mortgaged Property is located, (ii) had no interest, direct or indirect, in the
Mortgaged Property or in any Loan or the security therefor, and (iii) did not
receive compensation that affected the approval or disapproval of the Mortgage
Loan. The appraisal shall have been made within one hundred and eighty (180)
days of the origination of the Mortgage Loan and shall be completed in
compliance with the Uniform Standards of Professional Appraisal Practice, and
all applicable federal and state laws and regulations. If the appraisal was made
more than one hundred and twenty (120) days before the origination of the
Mortgage Loan, the Seller shall have received and delivered to the Purchaser a
recertification of the appraisal;
(oo) Disclosure Materials. The Mortgagor has, to the extent required
by applicable law, executed one or more statements to the effect that the
Mortgagor has, received all disclosure materials required by applicable law and
the Seller has complied with all applicable law with respect to the making of
the Mortgage Loans. The Seller shall cause the Interim Servicer to maintain such
statement(s) in the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. The
Mortgage Loan was not made to finance the construction or rehabilitation of a
Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) [Reserved].
(rr) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(ss) Credit Information; Fair Credit Reporting Act. As to each
consumer report (as defined in the Fair Credit Reporting Act, Public Law 91-508)
or other credit information furnished by the Seller to the Purchaser, the Seller
has full right and authority and is not precluded by law or contract from
furnishing such information to the Purchaser and the Purchaser is not precluded
by the terms of the Mortgage Loan Documents from furnishing the same to any
subsequent or prospective purchaser of such Mortgage. The Seller shall hold the
Purchaser harmless from any and all damages, losses, costs and expenses
(including attorney's fees) arising from disclosure of credit information in
connection with the Purchaser's secondary marketing operations and the purchase
and sale of mortgages. The Seller has in its capacity as servicer, for each
Mortgage Loan, fully furnished, in accordance with the Fair Credit Reporting Act
and its implementing regulations, accurate and complete information (e.g.,
favorable and unfavorable) on its borrower credit files to Equifax, Experian and
Trans Union Credit Information Company (three of the credit repositories), on a
monthly basis. The last sentence of the representation is a Deemed Material
Breach Representation;
(tt) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate and the acquisition by the holder of the Mortgage of the rights
of the lessee upon foreclosure or assignment in lieu of foreclosure or provide
the holder of the Mortgage with substantially similar protections; (3) the terms
of such lease do not (a) allow the termination thereof upon the lessee's default
without the holder of the Mortgage being entitled to receive written notice of,
and opportunity to cure, such default, (b) allow the termination of the lease in
the event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than fifteen (15) years; (5) the term of such lease does not terminate
earlier than five years after the maturity date of the Mortgage Note; and (6)
the Mortgaged Property is located in a jurisdiction in which the use of
leasehold estates in transferring ownership in residential properties is a
widely accepted practice;
(uu) Prepayment Penalty. The Mortgage Loan is subject to a
prepayment penalty as provided in the related Mortgage Note except as set forth
on the related Mortgage Loan Schedule. With respect to each Mortgage Loan that
has a prepayment penalty feature, each such prepayment penalty is enforceable
(subject to bankruptcy, insolvency, and similar laws affecting the rights of
creditors and general principles of equity) for the benefit of the Purchaser,
and each prepayment penalty is permitted pursuant to applicable law. Each such
prepayment penalty (x) is in an amount not greater than the maximum amount
permitted under applicable law and (y) may not be imposed for a term in excess
of five (5) years. With respect to any Mortgage Loan that contains a provision
permitting imposition of a prepayment penalty upon a prepayment prior to
maturity: (i) the Mortgage Loan provides some benefit to the Mortgagor (e.g., a
rate or fee reduction) in exchange for accepting such prepayment penalty, (ii)
prior to the Mortgage Loan origination, the Mortgagor had the option of
obtaining a mortgage loan that did not require payment of such a penalty and
(iii) the prepayment penalty was adequately disclosed to the Mortgagor pursuant
to applicable state, local and federal law. Clause (y) of the third sentence of
this representation and warranty is a Deemed Material and Adverse
Representation;
(vv) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(ww) Escrow Analysis. With respect to each Mortgage, the Seller has
within the last twelve (12) months (unless such Mortgage was originated within
such twelve month period) analyzed the required Escrow Payments for each
Mortgage and adjusted the amount of such payments so that, assuming all required
payments are timely made, any deficiency will be eliminated on or before the
first anniversary of such analysis, or any overage will be refunded to the
Mortgagor, in accordance with RESPA and any other applicable law;
(xx) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion and as described in the related Purchase Price and
Terms Agreement. The first two sentences of this representation are Deemed
Material Breach Representations;
(yy) Purchase of Insurance. No Mortgagor was required to purchase
any credit life, disability, accident or health insurance product as a condition
of obtaining the extension of credit. No Mortgagor 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.
This representation and warranty is a Deemed Material Breach Representation;
(zz) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or an Illinois land trust or a "living trust" and such "living
trust" is in compliance with Xxxxxx Xxx guidelines for such trusts;
(aaa) Insurance. The Seller has caused or, before or in connection
with the transfer of servicing, will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser;
(bbb) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(ccc) Flood Certification Contract. The Mortgage Loan is covered by
a paid in full, life of loan, transferable flood certification contract that has
been or will be assigned without penalty, cost or premium to the Purchaser;
(ddd) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(eee) Origination Date. Except as shown on the related Mortgage Loan
Schedule, the date of origination of the Mortgage Loan shall be no earlier than
three (3) months prior to the date such Mortgage Loan is first purchased by the
Purchaser;
(fff) Mortgage Submitted for Recordation. The Mortgage either has
been or will promptly be submitted for recordation in the appropriate
governmental recording office of the jurisdiction where the Mortgaged Property
is located;
(ggg) Endorsements. The Mortgage Note has been endorsed by Seller
for its own account and not as a fiduciary, trustee, trustor or beneficiary
under a trust agreement;
(hhh) Accuracy of Information. All information provided to the
Purchaser by the Seller with respect to the Mortgage Loan is accurate in all
material respects;
(iii) No Construction Loans. No Mortgage Loan was made to (a)
facilitate the trade-in or exchange of a Mortgaged Property or (b) finance the
construction or rehabilitation of a Mortgaged Property, unless the Mortgage Loan
is a construction-to-permanent mortgage loan which has been fully disbursed, all
construction work is complete and a completion certificate has been issued;
(jjj) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Seller has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor;
(kkk) No Arbitration. No Mortgage Loan originated on or after August
1, 2004 requires the Mortgagor to submit to arbitration to resolve any dispute
arising out of or relating in any way to the mortgage loan transaction. This
representation is a Deemed Material Breach Representation;
(lll) Origination Practices/No Steering. The Mortgagor was not
encouraged or required to select a Mortgage Loan product offered by the Mortgage
Loan's originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account such facts as, without limitation, the
Mortgage Loan's requirements and the Mortgagor's credit history, income, assets
and liabilities 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 Mortgagor 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 Mortgagor's application to such affiliate for underwriting
consideration. This representation is a Deemed Material Breach Representation;
(mmm) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan does not rely solely on the
extent of the Mortgagor's equity in the collateral as the principal determining
factor in approving such extension of credit. The methodology employed objective
criteria such facts as, without limitation, the Mortgagor's income, assets and
liabilities (except in the case of loan programs which do not require the
Mortgagor to report the Mortgagor's income or assets, such as "no income, no
assets" lending programs) or which rely on the Mortgagor's representation of the
Mortgagor's income, such as "stated income" lending programs) to the proposed
mortgage payment and, based on such methodology, the Mortgage Loan's originator
made a reasonable determination that at the time of origination the Mortgagor
had the ability to make timely payments on the Mortgage Loan. This
representation is a Deemed Material Breach Representation;
(nnn) Fees Charges. All fees and charges (including finance charges)
and whether or not financed, assessed, collected or to be collected in
connection with the origination and servicing of each Mortgage Loan have been
disclosed in writing to the Mortgagor in accordance with applicable state and
federal law and regulation. This representation is a Deemed Material Breach
Representation; and
(ooo) Second Lien Mortgage Loans. With respect to each Second Lien
Loan: (1) the related First Lien Loan does not permit negative amortization; (2)
where required or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) the related first lien Mortgage
contains a provision which provides for giving notice of default or breach to
the mortgagee under the Mortgage Loan and allows such mortgagee to cure any
default under the related First Lien Mortgage; and (4) except as set forth on
the related Mortgage Loan Schedule, the related Mortgaged Property was the
Mortgagor's principal residence at the time of the origination of such Second
Lien Loan. Item (4) of this representation is a Deemed Material Breach
Representation.
Subsection 9.03. Remedies for Breach of Representations and
Warranties.
It is understood and agreed that the representations and warranties
set forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage
Loans to the Purchaser and shall inure to the benefit of the Purchaser,
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
Assignment of Mortgage or, subject to Section 5, the examination or failure to
examine any Mortgage File. Upon discovery by either the Seller or the Purchaser
of a breach of any of the foregoing representations and warranties, the party
discovering such breach shall give prompt written notice to the other.
Within sixty (60) days of the earlier of either discovery by or
notice to the Seller of any breach of a representation or warranty which
materially and adversely affects the value of the Mortgage Loans or the interest
of the Purchaser therein (or which materially and adversely affects the value of
the applicable Mortgage Loan or the interest of the Purchaser therein in the
case of a representation and warranty relating to a particular Mortgage Loan),
the Seller shall use its best efforts promptly to cure such breach in all
material respects and, if such breach cannot be cured, the Seller shall, at the
Purchaser's option, repurchase such Mortgage Loan at the Repurchase Price.
Notwithstanding the above sentence, (i) within sixty (60) days of the earlier of
either discovery by, or notice to, the Seller of any breach of the
representation and warranty set forth in clause (rr) of Subsection 9.02, the
Seller shall repurchase such Mortgage Loan at the Repurchase Price and (ii) any
breach of a Deemed Material Breach Representation shall automatically be deemed
to materially and adversely affect the value of the Mortgage Loan and the
interest of the Purchaser therein. In the event that a breach shall involve any
representation or warranty set forth in Subsection 9.01, and (except as provided
in the preceding sentence with respect to certain breaches for which no cure is
permitted) such breach cannot be cured within sixty (60) days of the earlier of
either discovery by or notice to the Seller of such breach, all of the Mortgage
Loans materially and adversely affected thereby shall, at the Purchaser's
option, be repurchased by the Seller at the Repurchase Price. However, if the
breach shall involve a representation or warranty set forth in Subsection 9.02
(other than the representations and warranties set forth in clause (rr) of such
Subsection or any Deemed Material Breach Representation) and the Seller
discovers or receives notice of any such breach within one hundred twenty (120)
days of the related Closing Date, the Seller shall, at the Purchaser's option
and provided that the Seller has a Qualified Substitute Mortgage Loan, rather
than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan
(a "Deleted Mortgage Loan") and substitute in its place a Qualified Substitute
Mortgage Loan or Loans, provided that any such substitution shall be effected
not later than one hundred twenty (120) days after the related Closing Date. If
the Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the
deficient Mortgage Loan. Any repurchase of a Mortgage Loan or Loans pursuant to
the foregoing provisions of this Subsection 9.03 shall be accomplished by either
(a) if the Interim Servicing Agreement has been entered into and is in effect,
deposit in the Custodial Account of the amount of the Repurchase Price for
distribution to the Purchaser on the next scheduled Remittance Date, after
deducting therefrom any amount received in respect of such repurchased Mortgage
Loan or Loans and being held in the Custodial Account for future distribution or
(b) if the Interim Servicing Agreement has not been entered into or is no longer
in effect, by direct remittance of the Repurchase Price to the Purchaser or its
designee in accordance with the Purchaser's instructions.
With respect to any repurchase under this Section 9.03: (i) the
repurchase request must be made by the Purchaser in a prompt and timely manner
and must contain reasonably sufficient information to enable the Seller to
evaluate the request, including in the case of a first payment default, the
payment history, collection comments and such other information to the extent
reasonably requested by Seller and available to the Purchaser, (ii) with respect
to any Mortgage Loan that was never included in a Securitization Transaction,
the Purchaser shall use best efforts to notify the Seller of any known breach of
a representation and warranty and require the Seller to repurchase such Mortgage
Loan prior to foreclosure procedures commencing on such Mortgage Loan.
Upon Purchaser's receipt of the related Repurchase Price, Purchaser
shall (i) promptly release its interest in the Deleted Mortgage Loan to the
Seller, free and clear of any lien, charge or encumbrance suffered or incurred
by the Purchaser, and (ii) promptly, but in no event later than twenty (20) days
after payment of the Repurchase Price, deliver or cause to be delivered to the
Seller any documents held by the Custodian, servicer or other designee relating
to the Deleted Mortgage Loan. In the event of a repurchase or substitution, the
Seller shall, simultaneously with such reassignment, give written notice to the
Purchaser that such repurchase or substitution has taken place, and, in the case
of substitution, identify a Qualified Substitute Mortgage Loan and amend the
Mortgage Loan Schedule to reflect the addition of such Qualified Substitute
Mortgage Loan to this Agreement. In connection with any such substitution, the
Seller shall be deemed to have made as to such Qualified Substitute Mortgage
Loan the representations and warranties set forth in this Agreement except that
all such representations and warranties set forth in this Agreement shall be
deemed made as of the date of such substitution. The Seller shall effect such
substitution by delivering to the Custodian or to such other party as the
Purchaser may designate in writing for such Qualified Substitute Mortgage Loan
the documents required by Subsection 6.03, with the Mortgage Note endorsed as
required by Subsection 6.03. No substitution will be made in any calendar month
after the Determination Date for such month. The Seller shall cause the Interim
Servicer to remit directly to the Purchaser, or its designee in accordance with
the Purchaser's instructions the Monthly Payment less the Servicing Fee due, if
any, on such Qualified Substitute Mortgage Loan or Loans in the month following
the date of such substitution. Monthly Payments due with respect to Qualified
Substitute Mortgage Loans in the month of substitution shall be retained by the
Seller. For the month of substitution, distributions to the Purchaser shall
include the Monthly Payment due on any Deleted Mortgage Loan in the month of
substitution, and the Seller shall thereafter be entitled to retain all amounts
subsequently received by the Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the
Seller shall indemnify the Purchaser and its present and former directors,
officers, employees and agents and any Successor Servicer and its present and
former directors, officers, employees and agents and hold such parties harmless
against any losses, damages, penalties, fines, forfeitures, legal fees and
expenses and related costs, judgments, and other costs and expenses resulting
from any claim, demand, defense or assertion based on or grounded upon, or
resulting from, a breach of the Seller representations and warranties contained
in this Agreement or any Reconstitution Agreement. It is understood and agreed
that the obligations of the Seller set forth in this Subsection 9.03 to cure,
substitute for or repurchase a defective Mortgage Loan and to indemnify the
Purchaser and Successor Servicer as provided in this Subsection 9.03 and
Subsection 14.01 constitute the sole remedies of the Purchaser and Successor
Servicer respecting a breach of the foregoing representations and warranties.
For purposes of this paragraph "Purchaser" shall mean the Person then acting as
the Purchaser under this Agreement and any and all Persons who previously were
"Purchasers" under this Agreement and "Successor Servicer" shall mean any Person
designated as the Successor Servicer pursuant to this Agreement and any and all
Persons who previously were "Successor Servicers" pursuant to this Agreement.
Any cause of action against the Seller relating to or arising out of
the breach of any representations and warranties made in Subsections 9.01 and
9.02 shall accrue as to any Mortgage Loan upon (i) discovery of such breach by
the Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by
the Seller to cure such breach or repurchase such Mortgage Loan as specified
above, and (iii) demand upon the Seller by the Purchaser for compliance with
this Agreement.
Subsection 9.04. Repurchase of Mortgage Loans That Prepay in Full.
If any Mortgage Loan is prepaid in full within sixty (60) days from
and after the related Closing Date, the Seller shall pay to the Purchaser,
within five (5) business days following the Seller's receipt of written demand
therefore, which demand must be made within forty-five (45) days following the
date of such prepayment in full, an amount equal to (a) the Premium Percentage
multiplied by the outstanding principal balance of such Mortgage Loan as of the
date of such prepayment in full, less (b) the amount of any prepayment penalty
enforceable in connection with such prepayment.
Subsection 9.05. Repurchase of Mortgage Loans with First Payment
Defaults.
If the related Mortgagor is thirty (30) or more days delinquent with
respect to either the Mortgage Loan's Monthly Payment due in the month in which
the Closing Date occurs or the Monthly Payment due in the month following the
month of the Closing Date, the Seller, at the Purchaser's option exercised in
its sole discretion within forty-five (45) days following the occurrence of such
delinquency, shall repurchase such Mortgage Loan from the Purchaser at a price
equal to the percentage of par as stated in the related Purchase Price and Terms
Agreement (subject to adjustment as provided therein) multiplied by the then
outstanding principal balance of such Mortgage Loan, plus accrued and unpaid
interest thereon from the date to which interest was last paid through the day
prior to the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan.
Subsection 9.06. Purchaser's Right to Review.
Prior to the related Closing Date, the Purchaser shall have the
right to review each Mortgage File and Credit File, to conduct property
inspections, obtain appraisal recertifications, drive-by appraisals, brokers
price opinions and otherwise to underwrite the Mortgage Loans and to reject any
Mortgage Loan which in the Purchaser's sole opinion is an unacceptable
investment. Any rejected Mortgage Loan shall be removed from the terms of this
Agreement.
All rights of the Purchaser under this Subsection 9.06 shall
terminate upon the transfer of any Mortgage Loan to any other Purchaser.
Notwithstanding the foregoing, the fact that the Purchaser or its
designee has conducted or failed to conduct the review/due diligence procedures
specified above or any other partial or complete examination of the Mortgage
Files or Credit Files shall not impair in any way the Purchaser's or any of its
successors' rights to demand repurchase, substitution or any other remedy
provided under this Agreement; provided, however, that Purchaser may not demand
a repurchase or other relief or remedy due to the failure of a Mortgage Loan to
comply with the Underwriting Guidelines if the Purchaser or its designee has
previously examined such Mortgage Loan and certain exceptions to the
Underwriting Guidelines were noted and accepted by the Purchaser prior to the
purchase of such Mortgage Loan.
SECTION 10. Closing.
The closing for the purchase and sale of each Mortgage Loan Package
shall take place on the related Closing Date. At the Purchaser's option, the
Closing shall be either: by telephone, confirmed by letter or wire as the
parties shall agree, or conducted in person, at such place as the parties shall
agree.
The closing for the Mortgage Loans to be purchased on each Closing
Date shall be subject to each of the following conditions:
(a) at least two (2) Business Days prior to the related Closing
Date, or such later date on which the Purchaser has identified
to the Seller the final list of Mortgage Loans the Purchaser
desires to purchase, the Seller shall deliver to the
Purchaser, in electronic format acceptable to the Purchaser in
its sole discretion, a listing on a loan-level basis of the
necessary information to compute the Purchase Price of the
Mortgage Loans delivered on the Closing Date (including
accrued interest), and prepare a Mortgage Loan Schedule;
(b) all of the representations and warranties of the Seller under
this Agreement and of the Interim Servicer under the Interim
Servicing Agreement (with respect to each Mortgage Loan for an
interim period, as specified therein) shall be true and
correct as of the related Closing Date and no event shall have
occurred which, with notice or the passage of time, would
constitute a default under this Agreement or an Event of
Default under the Interim Servicing Agreement;
(c) the Purchaser shall have received, or the Purchaser's
attorneys shall have received in escrow, all closing documents
as specified in Section 11 of this Agreement, 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 Seller shall have delivered and released to the Custodian
all documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the
related Purchase Price and Terms Agreement shall have been
complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the
Seller on the related Closing Date the Purchase Price, plus accrued interest
pursuant to Section 4 of this Agreement, by wire transfer of immediately
available funds to the account(s) designated by the Seller.
SECTION 11. Closing Documents.
The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date shall consist of fully executed originals of the following
documents:
1. this Agreement (to be executed and delivered only for the
initial Closing Date);
2. a copy of the Interim Servicing Agreement, dated as of October
1, 2003;
3. a copy of the Custodial Agreement, dated as of October 1,
2003;
4. the related Mortgage Loan Schedule and Points Schedule,
segregated by Mortgage Loan Package, one copy to be attached
to the Custodian's counterpart of the Custodial Agreement, and
one copy to be attached to the related Assignment and
Conveyance as the Mortgage Loan Schedule thereto;
5. a Custodian's Certification, as required under the Custodial
Agreement, in the form of Exhibit G-1 to the Custodial
Agreement;
6. with respect to the initial Closing Date, an Officer's
Certificate, in the form of Exhibit C hereto with respect to
each of the Seller and the Interim Servicer, including all
attachments hereto; with respect to subsequent Closing Dates,
an Officer's Certificate upon request of the Purchaser;
7. with respect to the initial Closing Date, an Opinion of
Counsel of each of the Seller and the Interim Servicer (who
may be an employee of the Seller or the Interim Servicer, as
applicable), in the form of Exhibit D hereto ("Opinion of
Counsel of the Seller"); with respect to subsequent Closing
Dates, an Opinion of Counsel of the Seller upon request of the
Purchaser;
8. a Security Release Certification, substantially in the form of
Exhibit E or F, as applicable, hereto executed by any person,
as requested by the Purchaser, if any of the Mortgage Loans
have at any time been subject to any security interest, pledge
or hypothecation for the benefit of such person;
9. a certificate or other evidence of merger or change of name,
signed or stamped by the applicable regulatory authority, if
any of the Mortgage Loans were acquired by the Seller by
merger or acquired or originated by the Seller while
conducting business under a name other than its present name,
if applicable;
10. the related Underwriting Guidelines to be attached to the
related Assignment and Conveyance as Exhibit C;
11. Assignment and Conveyance Agreement in the form of Exhibit H
hereto;
12. Exhibit B to the related Assignment and Conveyance Agreement;
and
13. a MERS Report reflecting the Purchaser as Investor and no
Person as Interim Funder for each MERS Designated Mortgage
Loan (to be delivered within one Business Day of each Closing
Date).
The Seller shall bear the risk of loss of the closing documents
until such time as they are received by the Purchaser or its
attorneys.
SECTION 12. Costs.
The Purchaser shall pay any commissions due its salesmen and the
legal fees and expenses of its attorneys and custodial fees and the fees and
expenses of the Custodian. All other costs and expenses incurred in connection
with the one-time transfer and delivery of the Mortgage Loans and the Servicing
Rights including recording fees, fees for title policy endorsements and
continuations, fees for recording Assignments of Mortgage, and the Seller's
attorney's fees, shall be paid by the Seller.
SECTION 13. Cooperation of Seller with a Reconstitution.
The Seller and the Purchaser agree that with respect to some or all
of the Mortgage Loans, after each Closing Date, on one or more dates (each, a
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may effect
six (6) Reconstitutions within twelve (12) months following the related Closing
Date of some or all of the Mortgage Loans then subject to this Agreement,
without recourse, to:
a) Xxxxxx Xxx under its Cash Purchase Program or MBS
Program (Special Servicing Option) (each, a "Xxxxxx Mae
Transfer"); or
b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
c) one or more third party purchasers in one or more Whole
Loan Transfers; or
d) one or more trusts or other entities to be formed as
part of one or more Securitization Transactions.
The Seller agrees to execute in connection with any Agency Transfer,
any and all reasonably acceptable pool purchase contracts, and/or agreements
among the Purchaser, the Seller, Xxxxxx Xxx or Xxxxxxx Mac (as the case may be)
and any servicer in connection with a Whole Loan Transfer, a seller's warranties
and servicing agreement or a participation and servicing agreement in form and
substance reasonably acceptable to the parties, and in connection with a
Securitization Transaction, an Assignment and Recognition Agreement
substantially in the form attached hereto as Exhibit I (collectively, the
agreements referred to herein are designated, the "Reconstitution Agreements"),
together with an opinion of counsel as to customary corporate matters (which may
be an in house opinion of counsel) with respect to such Reconstitution
Agreements but only to the extent that such opinions are customarily delivered
and reasonably necessary; provided, however that Seller shall not be required to
service into a securitization and/or be a party to the pooling and servicing
agreement unless Seller consents in its sole discretion.
With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller agrees (1) to cooperate
fully with the Purchaser and any prospective purchaser with respect to all
reasonable requests and due diligence procedures; (2) to execute, deliver and
perform all Reconstitution Agreements reasonably required by the Purchaser; (3)
to restate the representations and warranties as set forth in the Assignment and
Recognition Agreement , a form which is attached as Exhibit I. The Seller shall
use its reasonable best efforts to provide to such master servicer or issuing
entity, as the case may be, and any other participants or purchasers in such
Reconstitution: (i) any and all appropriate information and appropriate
verification of information which may be reasonably available to the Seller or
its affiliates, whether through letters of its auditors and counsel or
otherwise, as the Purchaser or any such other participant shall reasonably
request; and (ii) such additional representations, warranties, covenants and
certificates of public officials or officers of the Seller or the Interim
Servicer as are reasonably believed necessary by the Purchaser or any such other
participant and as are reasonably acceptable to the Seller; and (iii) shall
execute, and deliver an Indemnification and Contribution Agreement in
substantially the form attached hereto as Exhibit J. Moreover, the Seller agrees
to cooperate with all reasonable requests made by the Purchaser to effect such
Reconstitution Agreements. The Seller shall indemnify the Purchaser, each
affiliate of the Purchaser participating in the Reconstitution and each Person
who controls the Purchaser or such affiliate and their respective present and
former directors, officers, employees and agents, and 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 each of them may sustain in any way related to any information
provided by or on behalf of the Seller regarding the Seller, the Seller's
servicing practices or performance, the Mortgage Loans or the Underwriting
Guidelines set forth in any offering document prepared in connection with any
Reconstitution. For purposes of the previous sentence, "Purchaser" shall mean
the Person then acting as the Purchaser under this Agreement and any and all
Persons who previously were "Purchasers" under this Agreement.
If the Seller is required to engage a third party to fulfill a
request pursuant to the foregoing paragraphs of this section, the Purchaser
shall reimburse the Seller for any reasonable out-of-pocket costs incurred by
the Seller with respect to such third party.
Except with respect to each MERS Designated Mortgage Loan, in the
event the Purchaser has elected to have the Interim Servicer or the Seller hold
record title to the Mortgages, prior to the Reconstitution Date, the Interim
Servicer or the Seller shall, to the extent not previously performed, prepare an
assignment of mortgage in blank or to the prospective purchaser or trustee, as
applicable, from the Interim Servicer or the Seller, as applicable, in form and
substance required by this Agreement, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each such Assignment of Mortgage,
track such Assignments of Mortgage to ensure they have been recorded and deliver
them as required by the prospective purchaser or trustee, as applicable, upon
the Interim Servicer's receipt thereof.
All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if the Interim
Servicing Agreement shall remain in effect with respect to the related Mortgage
Loan Package, shall continue to be serviced in accordance with the terms of this
Agreement and the Interim Servicing Agreement and with respect thereto this
Agreement shall remain in full force and effect.
SECTION 14. The Seller.
Subsection 14.01. Additional Indemnification by the Seller; Third
Party Claims.
(a) The Seller shall indemnify the Purchaser and its present and
former directors, officers, employees and agents and any Successor Servicer and
its present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, reasonable legal fees (including legal fees incurred in connection
with the enforcement of the Seller's indemnification obligation under this
Section 14.01) and related costs, judgments, and any other reasonable costs,
fees and expenses that such parties may sustain in any way related to the
failure of the Seller to perform its duties and the Interim Servicer to service
the Mortgage Loans in strict compliance with the terms of this Agreement or any
Reconstitution Agreement entered into pursuant to Section 13 or any breach of
any of Seller's representations, warranties and covenants set forth in this
Agreement (provided that such costs shall not include any lost profits). For
purposes of this paragraph "Purchaser" shall mean the Person then acting as the
Purchaser under this Agreement and any and all Persons who previously were
"Purchasers" under this Agreement and "Successor Servicer" shall mean any Person
designated as the Successor Servicer pursuant to this Agreement and any and all
Persons who previously were "Successor Servicers" pursuant to this Agreement.
(b) Promptly after receipt by an indemnified party under this
Section 14.01 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 14.01, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve the indemnifying party from any liability which it may have to any
indemnified party under this Section 14.01, except to the extent that it has
been prejudiced in any material respect, or from any liability which it may
have, otherwise than under this Section 14.01. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent that it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party; provided that if the defendants in any
such action include both the indemnified party and the indemnifying party and
the indemnified party or parties shall have reasonably concluded that there may
be legal defenses available to it or them and/or other indemnified parties which
are different from or additional to those available to the indemnifying party,
the indemnified party or parties shall have the right to select separate counsel
to assert such legal defenses and to otherwise participate in the defense of
such action on behalf of such indemnified party or parties. Upon receipt of
notice from the indemnifying party to such indemnified party of its election so
to assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable to such indemnified party for
expenses incurred by the indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate counsel in
connection with the assertion of legal defenses in accordance with the proviso
to the preceding sentence (it being understood, however, that the indemnifying
party shall not be liable for the expenses of more than one separate counsel
(together with one local counsel, if applicable)), (ii) the indemnifying party
shall not have employed counsel reasonably satisfactory to the indemnified party
to represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
Subsection 14.02. Merger or Consolidation of the Seller.
The Seller 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 Seller may be merged or consolidated, or
any corporation resulting from any merger, conversion or consolidation to which
the Seller shall be a party, or any Person succeeding to the business of the
Seller, shall be the successor of the Seller hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that the
successor or surviving Person shall have a net worth of at least $30,000,000.
SECTION 15. Financial Statements.
The Seller understands that in connection with the Purchaser's
marketing of the Mortgage Loans, the Purchaser shall make available to
prospective purchasers audited financial statements of the Seller for the most
recently completed three (3) fiscal years respecting which such statements are
available, as well as a Consolidated Statement of Condition of the Seller at the
end of the last two (2) fiscal years covered by such Consolidated Statement of
Operations. Upon reasonable request, the Seller shall also make available any
comparable interim statements to the extent any such statements have been
prepared by the Seller (and are available upon request to members or
stockholders of the Seller or the public at large). The Seller, if it has not
already done so, agrees to furnish promptly to the Purchaser copies of the
statements specified above. The Seller shall also make available information on
its servicing performance with respect to loans serviced for others, including
delinquency ratios.
The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by
any prospective purchaser regarding recent developments affecting the Seller or
the financial statements of the Seller.
SECTION 16. Mandatory Delivery; Grant of Security Interest.
The sale and delivery on the related Closing Date of the Mortgage
Loans described on the related Mortgage Loan Schedule is mandatory from and
after the date of the execution of the related Purchase Price and Terms
Agreement, it being specifically understood and agreed that each Mortgage Loan
is unique and identifiable on the date hereof and that an award of money damages
would be insufficient to compensate the Purchaser for the losses and damages
incurred by the Purchaser (including damages to prospective purchasers of the
Mortgage Loans) in the event of the Seller's failure to deliver (i) each of the
related Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans
or (iii) one or more Mortgage Loans otherwise acceptable to the Purchaser on or
before the related Closing Date. Immediately following the release of the lien
of the Seller's warehouse lender on each Mortgage Loan, the Seller hereby grants
to the Purchaser a lien on and a continuing security interest in each Mortgage
Loan and each document and instrument evidencing each such Mortgage Loan to
secure the performance by the Seller of its obligations under the related
Purchase Price and Terms Agreement, and the Seller agrees that it shall hold
such Mortgage Loans in custody for the Purchaser subject to the Purchaser's (i)
right to reject any Mortgage Loan (or Qualified Substitute Mortgage Loan) under
the terms of this Agreement and to require another Mortgage Loan (or Qualified
Substitute Mortgage Loan) to be substituted therefor, and (ii) obligation to pay
the Purchase Price for the Mortgage Loans. All rights and remedies of the
Purchaser under this Agreement are distinct from, and cumulative with, any other
rights or remedies under this Agreement or afforded by law or equity and all
such rights and remedies may be exercised concurrently, independently or
successively.
SECTION 17. Notices.
All demands, notices and communications hereunder shall be in
writing and shall be given via email, facsimile transmission or registered or
certified mail to the person at the address set forth below:
(i) if to the Seller:
Accredited Home Lenders, Inc.
00000 Xxxxxx xx Xxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxxxx
Fax: 000-000-0000
Email: xxxxxxxxx@xxxxxxxxxx.xxx
with a copy to:
Accredited Home Lenders, Inc.
00000 Xxxxxx Xxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxx
Fax: 000-000-0000
Email: xxxxx@xxxxxxxxxx.xxx
(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: 000-000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: 000-000-0000
Email: x.xxxxx@xxxxxx.xxx
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 18. Severability Clause.
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 19. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.
SECTION 20. Governing Law Jurisdiction; Consent to Service of
Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED
COUNTERPART THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND
SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT SHALL
BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT
TO ITS CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER
IRREVOCABLY (I) SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE
OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH
COURT; (III) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY
SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW; AND (IV) CONSENTS
TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL
ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER.
SECTION 21. Intention of the Parties.
It is the intention of the parties that the Purchaser is purchasing,
and the Seller is selling the Mortgage Loans and not a debt instrument of the
Seller or another security. Accordingly, the parties hereto each intend to treat
the transaction for federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. The Purchaser shall have the
right to review the Mortgage Loans and the related Mortgage Loan Files to
determine the characteristics of the Mortgage Loans which shall affect the
federal income tax consequences of owning the Mortgage Loans and the Seller
shall cooperate with all reasonable requests made by the Purchaser in the course
of such review.
SECTION 22. Successors and Assigns; Assignment of Purchase
Agreement.
This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller and the Purchaser and the respective permitted
successors and assigns of the Seller and the successors and assigns of the
Purchaser. Except as set forth under Section 14.02 above, this Agreement shall
not be assigned, pledged or hypothecated by the Seller to a third party without
the prior written consent of the Purchaser, which consent may not be
unreasonably withheld. This Agreement may be assigned, pledged or hypothecated
by the Purchaser in whole or in part, and with respect to one or more of the
Mortgage Loans, without the consent of the Seller. There shall be no limitation
on the number of assignments or transfers allowable by the Purchaser with
respect to the Mortgage Loans and this Agreement. In the event the Purchaser
assigns this Agreement, and the assignee assumes any of the Purchaser's
obligations hereunder, the Seller acknowledges and agrees to look solely to such
assignee, and not to the Purchaser, for performance of the obligations so
assumed and the Purchaser shall be relieved from any liability to the Seller
with respect thereto.
SECTION 23. Waivers.
No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced.
SECTION 24. Exhibits.
The exhibits to this Agreement are hereby incorporated and made a
part hereof and are an integral part of this Agreement.
SECTION 25. General Interpretive Principles.
For purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Agreement have the meanings assigned
to them in this Agreement and include the plural as well as the singular, and
the use of any gender herein shall be deemed to include the other gender;
(b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) references herein to "Articles," "Sections," "Subsections,"
"Paragraphs," and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other subdivisions of
this Agreement;
(d) reference to a Subsection without further reference to a Section
is a reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(e) the words "herein," "hereof," "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
provision; and
(f) the term "include" or "including" shall mean without limitation
by reason of enumeration.
SECTION 26. Reproduction of Documents.
This Agreement and all documents relating thereto, including,
without limitation, (a) consents, waivers and modifications which may hereafter
be executed, (b) documents received by any party at the closing, and (c)
financial statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 27. Further Agreements.
The Seller and the Purchaser each agree to execute and deliver to
the other such reasonable and appropriate additional documents, instruments or
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.
SECTION 28. Recordation of Assignments of Mortgage.
To the extent permitted by applicable law, for Mortgage Loans which
are not registered with MERS, each of the Assignments of Mortgage is subject to
recordation in the appropriate public offices for real property records in the
county or other comparable jurisdictions in which the related Mortgaged Property
is situated, such recordation to be effected at the Seller's expense in the
event recordation is either necessary under applicable law or requested by the
Purchaser at its sole option (other than with respect to the MERS Designated
Mortgage Loans).
SECTION 29. No Solicitation.
From and after the Closing Date, the Seller agrees that it will not
take any action or permit or cause any action to be taken by any of its agents
or affiliates, or by any independent contractors on the Seller's behalf, to
personally, by telephone or mail (via electronic means or otherwise), solicit
the borrower or obligor under any Mortgage Loan for any purpose whatsoever,
including to refinance a Mortgage Loan, in whole or in part, without the prior
written consent of the Purchaser. It is understood and agreed that all rights
and benefits relating to the solicitation of any Mortgagors and the attendant
rights, title and interest in and to the list of such Mortgagors and data
relating to their Mortgages (including insurance renewal dates) shall be
transferred to the Purchaser pursuant hereto on the Closing Date and the Seller
shall take no action to undermine these rights and benefits. Notwithstanding the
foregoing, it is understood and agreed that promotions undertaken by the Seller
or any affiliate of the Seller which are directed to the general public at
large, including, without limitation, mass mailing based on commercially
acquired mailing lists, newspaper, radio and television advertisements shall not
constitute solicitation under this Section 29.
SECTION 30. Waiver of Trial by Jury.
THE SELLER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS
AGREEMENT.
SECTION 31. Compliance with Regulation AB
Subsection 31.01. Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose
of Section 31 of this Agreement is to facilitate compliance by the Purchaser and
any Depositor with the provisions of Regulation AB and related rules and
regulations of the Commission. Although Regulation AB is applicable by its terms
only to offerings of asset-backed securities that are registered under the
Securities Act, the Seller acknowledges that investors in privately offered
securities may require that the Purchaser or any Depositor provide comparable
disclosure in unregistered offerings. References in this Agreement to compliance
with Regulation AB include provision of comparable disclosure in private
offerings.
Neither the Purchaser nor any Depositor shall exercise its right to
request delivery of information or other performance under these provisions
other than in good faith, or for purposes other than compliance with the
Securities Act, the Exchange Act and the rules and regulations of the Commission
thereunder (or the provision in a private offering of disclosure comparable to
that required under the Securities Act). The Seller acknowledges that
interpretations of the requirements of Regulation AB may change over time,
whether due to interpretive guidance provided by the Commission or its staff,
consensus among participants in the asset-backed securities markets, advice of
counsel, or otherwise, and agrees to comply with 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.
Furthermore, the Purchaser and the Seller agree that if any such changes in the
interpretations of the requirements of Regulation AB materially affect this
Article 31, then the Purchaser and the Seller will amend such affected
provisions in accordance with this Section 31. In connection with any
Securitization Transaction, the Seller 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
Seller, any Third-Party Originator and the Mortgage Loans, or the servicing of
the Mortgage Loans, reasonably believed by the Purchaser or any Depositor to be
necessary in order to effect such compliance.
The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller by providing timely notice of requests for information
under these provisions and by reasonably limiting such requests to information
required, in the Purchaser's reasonable judgment, to comply with Regulation AB.
Subsection 31.02. Additional Representations and Warranties of the
Seller.
(a) The Seller shall be deemed to represent to the Purchaser and to
any Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Subsection 31.03 that, except as disclosed in
writing to the Purchaser or such Depositor prior to such date: (i) there are no
material legal or governmental proceedings pending (or known to be contemplated)
against the Seller or any Third-Party Originator; and (vii) there are no
affiliations, relationships or transactions relating to the Seller or any
Third-Party Originator with respect to any Securitization Transaction and any
party thereto identified by the related Depositor of a type described in Item
1119 of Regulation AB.
(b) If so requested by the Purchaser or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Subsection 31.03, the Seller shall, within five (5) Business
Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section or, if
any such representation and warranty is not accurate as of the date of such
request, provide reasonably adequate disclosure of the pertinent facts, in
writing, to the requesting party.
Subsection 31.03. Information to Be Provided by the Seller.
In connection with any Securitization Transaction the Seller shall
(i) within five (5) Business Days following request by the Purchaser or any
Depositor, provide to the Purchaser and such Depositor (or, as applicable, cause
each Third Party Originator to provide), in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, the information and
materials specified in paragraphs (a) and (b) of this Subsection, and (ii) as
promptly as practicable following notice to or discovery by the Seller, provide
to the Purchaser and any Depositor (in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor) the information
specified in paragraph (d) of this Subsection. Notwithstanding the foregoing, it
is understood and agreed that (1) the information required pursuant to Items
1103(a)(1), 1110(a) and 1119 of Regulation AB (including the information
required pursuant to subparts (a)(A), (a)(D) and (c)(i)(B) of this Subsection
33.03) shall only be required to the extent that mortgage loans originated by
the Seller or a Third Party Originator, as the case may be, in the related
Securitization Transaction comprise 10% or more (or such other percentage as may
be required from time to time under Regulation AB) of the aggregate pool of
mortgage loans in such Securitization Transaction, (2) the information required
pursuant to Items 1110(b) and 1117 of Regulation AB (including the information
required pursuant to subparts (a)(B), (a)(C) and (c)(i)(A) of this Subsection
33.03) shall only be required to the extent that mortgage loans originated by
the Seller or a Third Party Originator, as the case may be, in the related
Securitization Transaction comprise 20% or more (or such other percentage as may
be required from time to time under Regulation AB) of the aggregate pool of
mortgage loans in such Securitization Transaction and (3) the information
required pursuant to Item 1105 of Regulation AB (including the information
required pursuant to subpart (b) below) shall only be required in Securitization
Transactions in which such Static Pool Information is material, as determined by
the Purchaser or Depositor in its sole reasonable determination of the
requirements of Regulation AB. Notwithstanding the foregoing, neither the
Purchaser nor any Depositor shall exercise its right to request delivery of such
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.
(a) Subject to the provisions of the preceding paragraph, if so
requested by the Purchaser or any Depositor, the Seller shall provide such
information regarding (i) the Seller, as originator of the Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent), or
(ii) each Third Party Originator, as is requested for the purpose of compliance
with Items 1103(a)(1), 1105, 1110, 1117 and 1119 of Regulation AB. Such
information shall include, at a minimum.
(i) the originator's form of organization;
(ii) a description of the originator's origination program and how
long the originator has been engaged in originating residential mortgage
loans, which description shall include a discussion of the originator's
experience in originating mortgage loans of a similar type as the Mortgage
Loans; information regarding the size and composition of the originator's
origination portfolio; and information that may be material, in the good
faith judgment of the Purchaser or any Depositor, to an analysis of the
performance of the Mortgage Loans, including the originator's credit
granting or underwriting criteria for mortgage loans of similar type(s) as
the Mortgage Loans and such other information as the Purchaser or any
Depositor may reasonably request for the purpose of compliance with Item
1110(b)(2) of Regulation AB;
(iii) a description of any material legal or governmental
proceedings pending (or known to be contemplated) against the Seller and
each Third Party Originator; and
(iv) a description of any affiliation or relationship between the
Seller, each Third Party Originator and any of the following parties to a
Securitization Transaction, as such parties are identified to the Seller
by the Purchaser or any Depositor in writing in advance of such
Securitization Transaction:
(1) the sponsor;
(2) the depositor;
(3) the issuing entity;
(4) any servicer;
(5) any trustee;
(6) any originator;
(7) any significant obligor;
(8) any enhancement or support provider; and
(9) any other material transaction party.
(b) Subject to the provisions of the initial paragraph of this
Section, if so requested by the Purchaser or any Depositor, the Seller shall
provide (or, as applicable, cause each Third Party Originator to provide) Static
Pool Information with respect to the mortgage loans (of a similar type as the
Mortgage Loans, as reasonably identified by the Purchaser as provided below)
originated by (i) the Seller, if the Seller is an originator of Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),
and/or (ii) each Third Party Originator. Such Static Pool Information shall be
prepared by the Seller (or Third Party Originator) on the basis of its
reasonable, good faith interpretation of the requirements of Item 1105(a)(1) (3)
of Regulation AB. To the extent that there is reasonably available to the Seller
(or Third Party Originator) Static Pool Information with respect to more than
one mortgage loan type, the Purchaser or any Depositor shall be entitled to
specify whether some or all of such information shall be provided pursuant to
this paragraph. The content of such Static Pool Information may be in the form
customarily provided by the Seller, and need not be customized for the Purchaser
or any Depositor. Such Static Pool Information for each vintage origination year
or prior securitized pool, as applicable, shall be presented in increments no
less frequently than quarterly over the life of the mortgage loans included in
the vintage origination year or prior securitized pool. The most recent periodic
increment must be as of a date no later than 135 days prior to the date of the
prospectus or other offering document in which the Static Pool Information is to
be included or incorporated by reference. The Static Pool Information shall be
provided in an electronic format that provides a permanent record of the
information provided, such as a portable document format (pdf) file, or other
such electronic format reasonably required by the Purchaser or the Depositor, as
applicable.
Promptly following notice or discovery of a material error in Static
Pool Information provided pursuant to the immediately preceding paragraph
(including an omission to include therein information required to be provided
pursuant to such paragraph), the Seller shall provide corrected Static Pool
Information to the Purchaser or any Depositor, as applicable, in the same format
in which Static Pool Information was previously provided to such party by the
Seller.
If so requested by the Purchaser or any Depositor, the Seller shall
provide (or, as applicable, cause each Third Party Originator to provide), at
the expense of the requesting party (to the extent of any additional incremental
expense associated with delivery pursuant to this Agreement), such agreed upon
procedures letters of certified public accountants reasonably acceptable to the
Purchaser or Depositor, as applicable, pertaining to Static Pool Information
relating to prior securitized pools for securitizations closed on or after
January 1, 2006 or, in the case of Static Pool Information with respect to the
Seller's or Third Party Originator's originations or purchases, to calendar
months commencing January 1, 2006, as the Purchaser or such Depositor shall
reasonably request. Such letters shall be addressed to and be for the benefit of
such parties as the Purchaser or such Depositor shall designate, which may
include, by way of example, any Sponsor, any Depositor and any broker dealer
acting as underwriter, placement agent or initial purchaser with respect to a
Securitization Transaction. Any such statement or letter may take the form of a
standard, generally applicable document accompanied by a reliance letter
authorizing reliance by the addressees designated by the Purchaser or such
Depositor.
(c) [Reserved].
(d) Subject to the provisions of the initial paragraph of this
Section, 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 Seller shall (or shall cause each Third
Party Originator to) (i) notify the Purchaser and any Depositor in writing of
(A) any material litigation or governmental proceedings pending against the
Seller or any Third Party Originator and (B) any affiliations or relationships
that develop following the closing date of a Securitization Transaction between
the Seller or any Third Party Originator and any of the parties specified in
clause (vi) of paragraph (a) of this Subsection (and any other parties
identified in writing by the requesting party) with respect to such
Securitization Transaction, and (ii) provide to the Purchaser and any Depositor
a description of such proceedings, affiliations or relationships.
(e) With respect to those Mortgage Loans that were sold to the
Purchaser pursuant to this Agreement, the Purchaser shall, to the extent
consistent with then-current industry practice, cause the servicer (or another
party) to be obligated to provide information, upon request by Seller in the
form customarily provided by such servicer or other party (which need not be
customized for the Seller) with respect to the Mortgage Loans reasonably
necessary for the Seller to comply with its obligations under Regulation AB,
including, without limitation, providing to the Seller Static Pool Information,
as set forth in Item 1105(a)(2) and (3) of Regulation AB (such information
provided by the servicer or such other party, the "Loan Performance
Information").
Subsection 31.04. Indemnification; Remedies.
(a) The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser, the Depositor, and each of the following parties participating in a
Securitization Transaction: each sponsor and issuing entity; each Person
responsible for the preparation, execution or filing of any report required to
be filed with the Commission with respect to such Securitization Transaction, or
for execution of a certification pursuant to Rule 13a 14(d) or Rule 15d 14(d)
under the Exchange Act with respect to such Securitization Transaction; each
broker dealer acting as underwriter, placement agent or initial purchaser, each
Person who controls any of such parties or the Depositor (within the meaning of
Section 15 of the Securities Act and Section 20 of the Exchange Act); and the
respective present and former directors, officers, employees and agents of each
of the foregoing and of the Depositor, and shall hold each of them harmless from
and against any losses, damages, penalties, fines, forfeitures, legal fees and
expenses and related costs, judgments, and any other costs, fees and expenses
that any of them may sustain arising out of or based upon:
(i) (A) any untrue statement of a material fact contained or alleged
to be contained in any information, report, certification, accountants'
letter or other material provided in written or electronic form under this
Section 31 by or on behalf of the Seller, or provided under this Section
31 by or on behalf of any Third Party Originator (collectively, the
"Seller Information"), or (B) the omission or alleged omission to state in
the Seller Information a material fact required to be stated in the Seller
Information or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, by way of clarification, that clause (B) of this paragraph shall
be construed solely by reference to the Seller Information and not to any
other information communicated in connection with a sale or purchase of
securities, without regard to whether the Seller Information or any
portion thereof is presented together with or separately from such other
information;
(ii) any failure by the Seller or any Third Party Originator to
deliver any information, report, certification, accountants' letter or
other material when and as required under this Section 31; or
(iii) any breach by the Seller of a representation or warranty set
forth in Subsection 31.02(a) or in a writing furnished pursuant to
Subsection 31.02(b) and made as of a date prior to the closing date of the
related Securitization Transaction, to the extent that such breach is not
cured by such closing date, or any breach by the Seller of a
representation or warranty in a writing furnished pursuant to Subsection
31.02(b) to the extent made as of a date subsequent to such closing date.
(b) In the case of any failure of performance described in clause
(a)(ii) of this Section, the Seller shall promptly reimburse the Purchaser, any
Depositor, as applicable, and each Person responsible for the preparation,
execution or filing of any report required to be filed with the Commission with
respect to such Securitization Transaction, or for execution of a certification
pursuant to Rule 13a 14(d) or Rule 15d 14(d) under the Exchange Act with respect
to such Securitization Transaction, for all costs reasonably incurred by each
such party in order to obtain the information, report, certification,
accountants' letter or other material not delivered as required by the Seller or
any Third Party Originator.
(c) The Purchaser shall indemnify the Seller, each affiliate of the
Seller 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 Loan Performance Information or (B) the omission or
alleged omission to state in the Loan Performance Information a material
fact required to be stated in the Loan Performance 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 Loan Performance Information and not to any
other information communicated in connection with a sale or purchase of
securities, without regard to whether the Loan Performance Information or
any portion thereof is presented together with or separately from such
other information; or
(ii) any failure by the Purchaser or by the related servicer to
deliver any Loan Performance Information as required under Subsection
31.03(e).
[Signatures Commence on Following Page]
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective officers thereunto duly authorized
as of the date first above written.
IXIS REAL ESTATE CAPITAL INC.
(Purchaser)
By:_________________________________
Name:
Title:
By:_________________________________
Name:
Title:
ACCREDITED HOME LENDERS, INC.
(Seller)
By:_________________________________
Name:
Title:
EXHIBIT A
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items, which shall be available for inspection by the
Purchaser and any prospective Purchaser, and which shall be delivered to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
pursuant to Section 6 of the Third Amended and Restated Mortgage Loan Purchase
and Warranties Agreement to which this Exhibit is attached (the "Agreement"):
(a) the original Mortgage Note bearing all intervening endorsements
evidencing a complete chain of assignment from the originator to the Seller,
endorsed "Pay to the order of , without recourse" and signed in the name of the
Seller by an authorized officer. To the extent that there is no room on the face
of the Mortgage Notes for endorsements, the endorsement may be contained on an
allonge, if state law so allows and the Custodian is so advised. If the Mortgage
Loan was acquired by the Seller in a merger, the endorsement must be by
"[Seller], successor by merger to [name of predecessor]." If the Mortgage Loan
was acquired or originated by the Seller while doing business under another
name, the endorsement must be by "[Seller], formerly known as [previous name]";
(b) the original of any guarantee executed in connection with the
Mortgage Note;
(c) the original Mortgage with evidence of recording thereon;
(d) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;
(e) except with respect to each MERS Designated Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording. The Assignment of Mortgage must be duly recorded only
if recordation is either necessary under applicable law or commonly required by
private institutional mortgage investors in the area where the Mortgaged
Property is located or on direction of the Purchaser as provided in this
Agreement. If the Assignment of Mortgage is to be recorded, the Mortgage shall
be assigned to the Purchaser. If the Assignment of Mortgage is not to be
recorded, the Assignment of Mortgage shall be delivered in blank. If the
Mortgage Loan was acquired by the Seller in a merger, the Assignment of Mortgage
must be made by "[Seller], successor by merger to [name of predecessor]". If the
Mortgage Loan was acquired or originated by the Seller while doing business
under another name, the Assignment of Mortgage must be by "[Seller], formerly
known as [previous name]";
(f) the originals of all intervening assignments of mortgage,
evidencing a complete chain of assignment from the originator to the Seller (or
MERS with respect to each MERS Designated Mortgage Loan), with evidence of
recording thereon;
(g) the original mortgagee policy of title insurance or, in the
event such original title policy is unavailable, a true copy of the related
policy binder, preliminary report or commitment for title; and
(h) any security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage.
Notwithstanding the foregoing, in connection with any item described
above in clauses (c) or (f), if the Seller cannot deliver or cause to be
delivered the original of any such item with evidence of recording thereon on or
prior to the related Closing Date because of a delay caused by the public
recording office where such item has been delivered for recordation or because
such item has been lost or because such public recording office retains the
original recorded item (each such item, a "Delayed Document"), the Seller shall
deliver or cause to be delivered to the Custodian, (i) in the case of a delay
caused by the public recording office, a photocopy of such Delayed Document,
together with an Officer's Certificate of the Seller (or certified by the title
company, escrow agent, or closing attorney) to the effect that such copy is a
true and correct copy of the Delayed Document that has been dispatched to the
appropriate public recording office for recordation (and the original recorded
Delayed Document or a copy of such Delayed Document certified by such public
recording office to be a true and complete copy of the original recorded Delayed
Document will be promptly delivered to the Custodian upon receipt thereof by the
Seller); or (ii) in the case of a Delayed Document where a public recording
office retains the original recorded Delayed Document or in the case where a
Delayed Document is lost after recordation in a public recording office, a copy
of such Delayed Document certified by such public recording office to be a true
and complete copy of the original recorded Delayed Document.
In the event of a delay caused by the public recording office in
returning any recorded document, the Seller shall deliver to the Purchaser,
within ninety (90) days of the Closing Date, an Officer's Certificate which
shall (i) identify the recorded document, (ii) state that the recorded document
has not been delivered to the Custodian due solely to a delay caused by the
public recording office, (iii) state the amount of time generally required by
the applicable recording office to record and return a document submitted for
recordation, and (iv) specify the date the applicable recorded document will be
delivered to the Custodian; provided, however, that any recorded document shall
in any event be delivered no later than one (1) year from the applicable Closing
Date. An extension of the date specified in (iv) above may be requested from the
Purchaser, which consent shall not be unreasonably withheld.
EXHIBIT B
[RESERVED]
EXHIBIT C
FORM OF SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
[Executive/Assistant] [Vice] President of Accredited Home Lenders, Inc., a state
chartered institution organized under the laws of the [State of ____________]
(the "Company"), and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete copy
of the charter of the Company which is in full force and effect on the
date hereof without amendment, waiver, rescission or modification.
2. Attached hereto as Exhibit 2 is a true, correct and complete copy
of the bylaws of the Company which are in effect on the date hereof
without amendment, waiver, rescission or modification.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Company issued within ten (10) days of the date hereof,
and no event has occurred since the date thereof which would impair such
standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete copy
of the corporate resolutions of the Board of Directors of the Company
authorizing the Company to execute and deliver agreements such as the
Third Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of August 1, 2006, by and between IXIS Real Estate
Capital Inc. (the "Purchaser") and the Company (the "Purchase Agreement"),
the Interim Servicing Agreement, dated as of October 1, 2003, by and
between the Company and the Purchaser (the "Interim Servicing Agreement")
and to endorse the Mortgage Notes and execute the Assignments of Mortgages
by original signature, and such resolutions are in effect on the date
hereof without amendment, waiver, rescission or modification.
5. Either (i) 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 the Purchase Agreement, the Interim Servicing Agreement, the sale of
the mortgage loans or the consummation of the transactions contemplated by
the agreements; or (ii) any required consent, approval, authorization or
order has been obtained by the Company.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of the Purchase Agreement and the Interim
Servicing Agreement conflicts or will conflict with or results or will
result in a material breach of or constitutes or will constitute a
material default under the charter or by-laws of the Company, the terms of
any indenture or other agreement or instrument to which the Company is a
party or by which it is bound or to which it is subject, or any statute or
order, rule, regulations, writ, injunction or decree of any court,
governmental authority or regulatory body to which the Company is subject
or by which it is bound.
7. To the best of my knowledge, except as disclosed in filings with
the Securities Exchange Commission by the Seller or its Affiliates, there
is no action, suit, proceeding or investigation pending or threatened
against the Company which, in my judgment, either in any one instance or
in the aggregate, may result in any material adverse change in the
business, operations, financial condition, properties or assets of the
Company or in any material impairment of the right or ability of the
Company to carry on its business substantially as now conducted or in any
material liability on the part of the Company or which would draw into
question the validity of the Purchase Agreement and the Interim Servicing
Agreement, or the mortgage loans or of any action taken or to be taken in
connection with the transactions contemplated hereby, or which would be
likely to impair materially the ability of the Company to perform under
the terms of the Purchase Agreement and the Interim Servicing Agreement.
8. Each person listed on Exhibit 5 attached hereto who, as an
officer or representative of the Company, signed (a) the Purchase
Agreement, (b) the Interim Servicing Agreement and (c) any other document
delivered before or on the date hereof in connection with any purchase
described in the agreements set forth above, other than endorsements of
Mortgage Notes, was, at the respective times of such signing and delivery,
a duly elected or appointed, qualified and acting officer or
representative of the Company, who holds the office set forth opposite his
or her name on Exhibit 5, and the signatures of such persons appearing on
such documents are their genuine signatures.
9. The Company is duly authorized to engage in the transactions
described and contemplated in the Purchase Agreement and the Interim
Servicing Agreement.
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.
Dated:____________________ By:______________________________
Name:
[Seal] Title: [Executive/Assistant]
[Vice] President
I, ________________________, an [Assistant] Secretary of Accredited
Home Lenders, Inc., hereby certify that ____________ is the duly elected,
qualified and acting [Vice] President of the Company and that the signature
appearing above is [her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated:____________________ By:_____________________________
Name:________________________
Title: [Assistant] Secretary
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER
AND INTERIM SERVICER (date)
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General
Counsel to Accredited Home Lenders, Inc. (the "Company"), with respect to
certain matters in connection with the sale by the Company of the Mortgage Loans
pursuant to that certain Third Amended and Restated Mortgage Loan Purchase and
Warranties Agreement by and between the Company and IXIS Real Estate Capital
Inc. (the "Purchaser"), dated as of August 1, 2006 (the "Purchase Agreement")
which sale is in the form of whole loans, and serviced pursuant to an Interim
Servicing Agreement, dated as of October 1, 2003 by and between the Interim
Servicer and the Purchaser (the "Interim Servicing Agreement" and, collectively
with the Purchase Agreement, the "Agreements"). Capitalized terms not otherwise
defined herein have the meanings set forth in the Purchase Agreement and the
Interim Servicing Agreement.
[We] [I] have examined the following documents:
1. the Purchase Agreement;
2. the Interim Servicing Agreement;
3. the form of Assignment of Mortgage [for a Mortgage Loan
secured by a Mortgaged Property located in the State of
California];
4. the form of endorsement of the Mortgage Notes; and
5. such other documents, records and papers as we have deemed
necessary and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I]
have relied upon the representations and warranties of the Company and the
Interim Servicer contained in the Purchase Agreement and in the Interim
Servicing Agreement, as applicable. [We] [I] have assumed the authenticity of
all documents submitted to [us] [me] as originals, the genuineness of all
signatures, the legal capacity of natural persons and the conformity to the
originals of all documents.
Based upon the foregoing, it is [our] [my] opinion that:
1. The Company and the Interim Servicer is a corporation duly
organized, validly existing and in good standing under the laws of
the United States and is qualified to transact business in, and is
in good standing under, the laws of the State of California.
2. Each of the Company and the Interim Servicer has the power to engage
in the transactions contemplated by the Agreements to which it is a
party and all requisite power, authority and legal right to execute
and deliver such Agreements and to perform and observe the terms and
conditions of such Agreements.
3. Each of the Agreements to which it is a party has been duly
authorized, executed and delivered by the Company and the Interim
Servicer, as applicable, and is a legal, valid and binding agreement
enforceable in accordance with its respective terms against the
Company and the Interim Servicer, as applicable, 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, none of which will materially interfere with
the realization of the benefits provided thereunder or with the
Purchaser's ownership of the Mortgage Loans.
4. Each of the Company and the Interim Servicer has been duly
authorized to allow certain of its officers to execute any and all
documents by original signature in order to complete the
transactions contemplated by the Agreements to which it is a party
and to execute the endorsements to the Mortgage Notes and the
Assignments of Mortgages, and the original [or facsimile] signature
of the officers of the Company executing the endorsements to the
Mortgage Notes and any Assignments of Mortgages represents the legal
and valid signatures of said officers of the Company.
5. Either (i) 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 or the Interim Servicer of
or compliance by the Company or the Interim Servicer with the
Agreements to which it is a party and the sale of the Mortgage Loans
by the Company or the consummation of the transactions contemplated
by the Agreements to which each is a party or (ii) any required
consent, approval, authorization or order has been obtained by the
Company or the Interim Servicer.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of, the Agreements to which it is a
party conflicts or will conflict with or results or will result in a
material breach of or constitutes or will constitute a material
default under the charter, by-laws or other organizational documents
of the Company or the Interim Servicer, as applicable, the terms of
any indenture or other agreement or instrument to which the Company
or the Interim Servicer is a party or by which it is bound or to
which it is subject, or violates any statute or order, rule,
regulations, writ, injunction or decree of any court, governmental
authority or regulatory body to which the Company or the Interim
Servicer is subject or by which it is bound.
7. Except as disclosed in filings with the Securities Exchange
Commission by the Company or its Affiliates, there is no action,
suit, proceeding or investigation pending or, to my knowledge,
threatened against the Company or the Interim Servicer which, in
[our] [my] judgment, either in any one instance or in the aggregate,
may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Company
or the Interim Servicer or in any material impairment of the right
or ability of the Company or the Interim Servicer to carry on its
business substantially as now conducted or in any material liability
on the part of the Company or the Interim Servicer or which would
draw into question the validity of the Agreements to which it is a
party or the Mortgage Loans or of any action taken or to be taken in
connection with the transactions contemplated thereby, or which
would be likely to impair the ability of the Company or the Interim
Servicer to perform under the terms of the Agreements to which it is
a party.
8. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Agreements is sufficient to fully transfer to
the Purchaser all right, title and interest of the Company thereto
as noteholder and mortgagee.
9. The endorsement of the Mortgage Notes, the delivery to the
Purchaser, or its designee, of any Assignments of Mortgage, the
transfer to the Purchaser, or its designee, in the MERS System of
beneficial ownership of each MERS Designated Mortgage Loan, and the
delivery of the original endorsed Mortgage Notes to the Purchaser,
or its designee, are sufficient to permit the Purchaser to avail
itself of all protection available under applicable law against the
claims of any present or future creditors of the Company, and are
sufficient to prevent any other sale, transfer, assignment, pledge
or hypothecation of the Mortgages and the Mortgage Notes by the
Company from being enforceable.
I am admitted to the bar of the State of California, and I express
no opinion as to the laws of any other jurisdiction except as to matters that
are governed by federal law. This opinion is given to you for your sole benefit,
and no other person or entity is entitled to rely hereon except that the
purchaser or purchasers to which you initially and directly resell the Mortgage
Loans may rely on this opinion as if it were addressed to them as of its date. I
make no undertaking to supplement or update this opinion if, after the date
hereof, facts or circumstances come to my attention or changes in the law occur
which could affect such opinion.
Very truly yours,
------------------------------------
[Name]
[Assistant] General Counsel
EXHIBIT E
FORM OF SECURITY RELEASE CERTIFICATION
___________________, _____
________________________
________________________
________________________
Attention: ___________________________
___________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that Accredited Home Lenders, Inc., a
corporation organized pursuant to the laws of the State of California (the
"Company") has committed to sell to IXIS Real Estate Capital Inc. under an Third
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of August 1, 2006, certain mortgage loans originated by the Company. The Company
warrants that the mortgage loans to be sold to IXIS Real Estate Capital Inc. are
in addition to and beyond any collateral required to secure advances made by you
to the Company.
The Company acknowledges that the mortgage loans to be sold to IXIS
Real Estate Capital Inc. shall not be used as additional or substitute
collateral for advances made by [____________]. IXIS Real Estate Capital Inc.
understands that the balance of the Company's mortgage loan portfolio may be
used as collateral or additional collateral for advances made by [___________],
and confirms that it has no interest therein.
Execution of this letter by [___________] shall constitute a full
and complete release of any security interest, claim, or lien which
[___________] may have against the mortgage loans to be sold to IXIS Real Estate
Capital Inc.
Very truly yours,
_______________________________________
By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
Acknowledged and approved:
__________________________
By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
EXHIBIT F
FORM OF SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
Upon receipt of the sum of $________ in immediately available funds
in accordance with wiring instructions separately provided, the financial
institution named below hereby relinquishes any and all right, title and
interest it may have in the Mortgage Loans identified in the attached schedule
to be purchased by IXIS Real Estate Capital Inc. from Accredited Home Lenders,
Inc. (the "Company"), and certifies that all notes, mortgages, assignments and
other documents in its possession relating to such Mortgage Loans have been
delivered and released to the Company named below or its designees, as of the
date and time of the sale of such Mortgage Loans to IXIS Real Estate Capital
Inc.
Name and Address of Financial Institution
________________________________
(Name)
________________________________
(Address)
By:_____________________________
II. Certification of Release
The Company named below hereby certifies to IXIS Real Estate Capital
Inc. that, as of the date and time of the sale of the above-mentioned Mortgage
Loans to IXIS Real Estate Capital Inc., the security interests in the Mortgage
Loans released by the above-named financial institution comprise all security
interests relating to or affecting any and all such Mortgage Loans. The Company
warrants that, as of such time, there are and will be no other security
interests affecting any or all of such Mortgage Loans.
______________________________
By:___________________________
Title:________________________
Date:_________________________
EXHIBIT G
[RESERVED]
EXHIBIT H
ASSIGNMENT AND CONVEYANCE
On this ___ day of __________, ____, ___________________ ("Seller"),
as (i) the Seller under that certain Purchase Price and Terms Agreement, dated
as of ___________, _____ (the "PPTA"), (ii) the Seller under that certain Third
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of August 1, 2006 (the "Purchase Agreement") and (iii) the Seller/Interim
Servicer under that certain Interim Servicing Agreement, dated as of October 1,
2003 (the "Interim Servicing Agreement" and, together with the PPTA and the
Purchase Agreement, the "Agreements") does hereby sell, transfer, assign, set
over and convey to IXIS Real Estate Capital Inc. ("Purchaser") as the Purchaser
under the Agreements, without recourse, but subject to the terms of the
Agreements, all right, title and interest of, in and to the Mortgage Loans
listed on the Mortgage Loan Schedule attached hereto as Exhibit A (the "Mortgage
Loans"), together with the Mortgage Files and all rights and obligations arising
under the documents contained therein. Each Mortgage Loan subject to the
Agreements was underwritten in accordance with, and conforms to, the
Underwriting Guidelines attached hereto as Exhibit C. Pursuant to Section 6 of
the Purchase Agreement, the Seller has delivered to the Custodian the documents
for each Mortgage Loan to be purchased as set forth in the Purchase Agreement.
The contents of each Servicing File required to be retained by Accredited Home
Lenders, Inc. ("Interim Servicer") to service the Mortgage Loans pursuant to the
Interim Servicing Agreement and thus not delivered to the Purchaser are and
shall be held in trust by the Seller in its capacity as Interim Servicer for the
benefit of the Purchaser as the owner thereof. The Interim Servicer's possession
of any portion of the Servicing File is at the will of the Purchaser for the
sole purpose of facilitating servicing of the related Mortgage Loan pursuant to
the Interim Servicing Agreement, and such retention and possession by the
Interim Servicer shall be in a custodial capacity only. The ownership of each
Mortgage Note, Mortgage, the Servicing Rights and the contents of the Mortgage
File and Servicing File is vested in the Purchaser and the ownership of all
records and documents with respect to the related Mortgage Loan prepared by or
which come into the possession of the Seller or the Interim Servicer shall
immediately vest in the Purchaser and shall be retained and maintained, in
trust, by the Seller at the will of the Purchaser in such custodial capacity
only.
The Mortgage Loan Package characteristics of the Mortgage Loans
subject hereto are set forth on Exhibit B hereto.
In accordance with Section 6 of the Purchase Agreement, the
Purchaser accepts the Mortgage Loans listed on Exhibit A attached hereto.
Notwithstanding the foregoing the Purchaser does not waive any rights or
remedies it may have under the Agreements.
Capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
ACCREDITED HOME LENDERS, INC.
By:_________________________________
Name:
Title:
Accepted and Agreed:
IXIS REAL ESTATE CAPITAL INC.
By:___________________________________
Name:
Title:
By:___________________________________
Name:
Title:
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
Exhibit H
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL CHARACTERISTICS OF
EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on
the related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than _ months prior to the related
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than
___; or (5) a debt-to-income ratio of more than __%. Each First Lien Loan has a
Mortgage Interest Rate of at least ___% per annum and an outstanding principal
balance less than $_________. Each Second Lien Loan has a Mortgage Interest Rate
of at least ______% per annum and an outstanding principal balance less than
$________. Each Adjustable Rate Mortgage Loan has an Index of [_______].
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
EXHIBIT I
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [____________ __,
20__] ("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"),
[____________________] ("Assignee") and Accredited Home Lenders, Inc. (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and
other valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Third Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of August 1, 2006, between the Assignor, as purchaser (the
"Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the
Assignee hereunder (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 Purchase Agreement which are not the Mortgage Loans set forth on the
Mortgage Loan Schedule and are not the subject of this Agreement or (ii) the
rights of the Purchaser under Section 9.04 of the Purchase Agreement.
Recognition of the Company
2. 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 Purchase Agreement
(solely to the extent set forth herein) and this Agreement to [___] (the
"Trust") created pursuant to a Pooling and Servicing Agreement, dated as of
[___], 200[_] (the "Pooling Agreement"), among the Assignee, the Assignor,
[___], as trustee (including its successors in interest and any successor
trustees under the Pooling Agreement, the "Trustee"), [ ], as servicer
(including its successors in interest and any successor servicer under the
Pooling Agreement, the "Servicer"). The Company hereby acknowledges and agrees
that from and after the date hereof (i) the Trust will be the owner of the
Mortgage Loans, (ii) the Company shall look solely to the Trust for performance
of any obligations of the Assignor insofar as they relate to the Mortgage Loans,
(iii) the Trust (including the Trustee and the Servicer acting on the Trust's
behalf) shall have all the rights and remedies available to the Assignor,
insofar as they relate to the Mortgage Loans, under the Purchase Agreement,
including, without limitation, the enforcement of the document delivery
requirements set forth in Section 6 of the Purchase Agreement, and shall be
entitled to enforce all of the obligations of the Company thereunder insofar as
they relate to the Mortgage Loans, and (iv) all references to the Purchaser, the
Custodian or the Bailee under the Purchase Agreement insofar as they relate to
the Mortgage Loans, shall be deemed to refer to the Trust (including the Trustee
and the Servicer acting on the Trust's behalf). Neither the Company nor the
Assignor shall amend or agree to amend, modify, waiver, or otherwise alter any
of the terms or provisions of the Purchase Agreement which amendment,
modification, waiver or other alteration would in any way affect the Mortgage
Loans or the Company's performance under the Purchase Agreement with respect to
the Mortgage Loans without the prior written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of
the Company's business and will not conflict with, or result in a breach
of, any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument
to which the Company is now a party or by which it is bound, or result in
the violation of any law, rule, regulation, order, judgment or decree to
which the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity
regardless of whether enforceability is considered in a proceeding in
equity or at law;
(c) Except as has already been obtained, no consent, approval, order
or authorization of, or declaration, filing or registration with, any
governmental entity is required to be obtained or made by the Company in
connection with the execution, delivery or performance by the Company of
this Agreement; and
(d) Except as disclosed in public filings with the Securities
Exchange Commission by the Company or its affiliates, there is no action,
suit, proceeding or investigation pending or threatened against the
Company, before any court, administrative agency or other tribunal, which
would draw into question the validity of this Agreement or the Purchase
Agreement, or which, either in any one instance or in the aggregate, would
result in any material adverse change in the ability of the Company to
perform its obligations under this Agreement or the Purchase Agreement,
and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that the representations and warranties set forth in Subsection
9.01 of the Purchase Agreement are true and correct as of the date hereof as if
such representations and warranties were made on the date hereof, and that the
representations and warranties set forth on Exhibit B attached hereto are true
and correct as of the date or dates set forth thereon.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee and
the Servicer acting on the Trust's behalf) in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3 and 4
hereof shall be as set forth in Subsection 9.03 of the Purchase Agreement as if
they were set forth herein (including without limitation the repurchase and
indemnity obligations set forth therein).
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors
and assigns of the parties hereto and (ii) the Trust (including the Trustee and
the Servicer acting on the Trust's behalf). Any entity into which Assignor,
Assignee or Company may be merged or consolidated shall, without the requirement
for any further writing, be deemed Assignor, Assignee or Company, respectively,
hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive
the conveyance of the Mortgage Loans and the assignment of the Purchase
Agreement (to the extent assigned hereunder) by Assignor to Assignee and by
Assignee to the Trust and nothing contained herein shall supersede or amend the
terms of the Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
ACCREDITED HOME LENDERS, INC.
By:_________________________________
Name:_______________________________
Its:________________________________
IXIS REAL ESTATE CAPITAL INC.
By:_________________________________
Name:_______________________________
Its:________________________________
By:_________________________________
Name:_______________________________
Its:________________________________
[ASSIGNEE]
By:_________________________________
Name:_______________________________
Its:________________________________
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
EXHIBIT B TO ASSIGNMENT AND RECOGNITION AGREEMENT
REPRESENTATIONS AND WARRANTIES AS TO THE MORTGAGE LOANS
The Company hereby represents and warrants as to each Mortgage Loan,
as of the date on which the Company transferred servicing of the Mortgage Loan
to the Purchaser, or its designee (the "Servicing Transfer Date"), unless
otherwise set forth below:
(a) [Reserved];
(b) Payments Current. Except as set forth on the Mortgage Loan
Schedule delivered to the Purchaser by the Company on the Servicing Transfer
Date, no payment required to be made up to the Transfer Date under the Mortgage
Loan is 30 days or more delinquent nor has any payment under the Mortgage Loan
been 30 days or more delinquent at any time since the origination of the
Mortgage Loan;
(c) No Outstanding Charges. Except as set forth on the Mortgage Loan
Schedule delivered to the Purchaser by the Company on the Servicing Transfer
Date, to the Company's knowledge as of the Servicing Transfer Date there are no
defaults in complying with the terms of the Mortgage securing the Mortgage Loan,
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 an escrow of funds has been established in an
amount sufficient to pay for every such item which remains unpaid and which has
been assessed but is not yet due and payable. As of the closing date for the
Securitization Transaction (the "Securitization Closing Date"), except for (A)
payments in the nature of escrow payments and (B) interest accruing from the
date of the Mortgage Note or date of disbursement of the Mortgage Loan proceeds,
whichever is earlier to the day which precedes by one month the Due Date of the
first installment of principal and/or interest, including, without limitation,
taxes and insurance payments, the Company has not advanced funds, or induced,
solicited or knowingly received any advance of funds by a party other than the
Mortgagor, directly or indirectly, for the payment of any amount required under
the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination except by a written instrument which has been
recorded, if necessary to protect the interests of the Purchaser, and which has
been delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. As no
Mortgagor has been released, in whole or in part, except in connection with an
assumption agreement, approved by the title insurer, to the extent required by
the policy, and which assumption agreement is part of the Mortgage File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) No Defenses. The Mortgage Loan is 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 either the
Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject to
any right of rescission, set-off, counterclaim or defense, including without
limitation the defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was funded;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement. If required by the National Flood Insurance Act
of 1968, as amended, each Mortgage Loan is covered by a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration in effect, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement. All individual insurance
policies contain a standard mortgagee clause naming the Company and its
successors and assigns as mortgagee, and all premiums thereon have been paid and
such policies may not be reduced, terminated or cancelled without 30 days' prior
written notice to the mortgagee. The Mortgage obligates the Mortgagor thereunder
to maintain the hazard insurance policy at the Mortgagor's cost and expense, and
on the Mortgagor's failure to do so, authorizes the holder of the Mortgage to
obtain and maintain such insurance at such Mortgagor's cost and expense, and to
seek reimbursement therefor from the Mortgagor. Where required by state law or
regulation, the Mortgagor has been given an opportunity to choose the carrier of
the required hazard insurance, provided the policy is not a "master" or
"blanket" hazard insurance policy covering a condominium, or any hazard
insurance policy covering the common facilities of a planned unit development.
The hazard insurance policy is the valid and binding obligation of the insurer,
is in full force and effect, and will be in full force and effect and inure to
the benefit of the Purchaser upon the consummation of the purchase transactions
contemplated by this Agreement. As of the Securitization Closing Date, the
Company has not engaged in, and has no knowledge of the Mortgagor's or any
servicer's having engaged in, any act or omission which would impair the
coverage of any such policy, the benefits of the endorsement provided for
herein, or the validity and binding effect of such policy, including, without
limitation, no unlawful fee, commission, kickback or other unlawful compensation
or value of any kind has been or will be received, retained or realized by any
attorney, firm or other person or entity, and no such unlawful items have been
received, retained or realized by the Company;
(g) Compliance with Applicable Laws. As of the Securitization
Closing Date, 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, predatory and abusive lending, equal
credit opportunity and disclosure laws applicable to the Mortgage Loan,
including, without limitation, any provisions relating to Prepayment Charges,
have been complied with, the consummation of the transactions contemplated
hereby will not involve the violation of any such laws or regulations, and the
Company shall maintain in its possession, available for the Purchaser's
inspection, and shall deliver to the Purchaser upon demand, evidence of
compliance with all such requirements. Notwithstanding the foregoing, the
Company shall not be responsible for a breach of a federal, state or local law,
other than those governing (i) the origination and (ii) servicing of the
Mortgage Loans by the Company during the interim servicing period, following the
Transfer Date;
(h) No Satisfaction of Mortgage. The Mortgage has not been
satisfied, canceled, subordinated (except to a senior mortgage in the case of a
Second Lien Loan) or rescinded, in whole or in part, and the Mortgaged Property
has not been released from the lien of the Mortgage, in whole or in part, nor
has any instrument been executed that would effect any such 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;
(i) Location and Type of Mortgaged Property. The Mortgaged Property
is a fee simple property located in the state identified in the related Mortgage
Loan Schedule, except that with respect to real property located in
jurisdictions in which the use of leasehold estates for residential properties
is a widely-accepted practice, the Mortgaged Property may be a leasehold estate,
and consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a condominium project, or an individual unit in
a planned unit development; provided, however, that no residence or dwelling is
a mobile home and any condominium unit or planned unit development shall not
fall within any of the "Ineligible Projects" of part XII, Section 102 of the
Xxxxxx Xxx Selling Guide and shall conform with the Underwriting Guidelines. In
the case of any Mortgaged Properties that are manufactured homes (a
"Manufactured Home Mortgage Loans"), (i) such Manufactured Home Mortgage Loan
conforms with the applicable Xxxxxx Mae or Xxxxxxx Mac requirements regarding
mortgage loans related to manufactured dwellings, (ii) the related manufactured
dwelling is permanently affixed to the land, (iii) the related manufactured
dwelling and the related land are subject to a Mortgage properly filed in the
appropriate public recording office and naming Company as mortgagee, (iv) the
applicable laws of the jurisdiction in which the related Mortgaged Property is
located will deem the manufactured dwelling located on such Mortgaged Property
to be a part of the real property on which such dwelling is located, and (v)
such Manufactured Home Mortgage Loan is (x) a qualified mortgage under Section
860G(a)(3) of the Internal Revenue Code of 1986, as amended and (y) secured by
manufactured housing treated as a single family residence under Section
25(e)(10) of the Code. As of the date of origination, no portion of the
Mortgaged Property was used for commercial purposes, and, to the Company's
knowledge as of the Servicing Transfer Date, no portion of the Mortgaged
Property has been used for commercial purposes; provided, that Mortgaged
Properties which contain a home office shall not be considered as being used for
commercial purposes as long as the Mortgaged Property has not been altered for
commercial purposes and is not storing any chemicals or raw materials other than
those commonly used for homeowner repair, maintenance and/or household purposes;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements on
the Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to such
buildings, and all additions, alterations and replacements made at any time,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. In no event shall any Mortgage Loan be
in a lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(i) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(ii) the lien of current real property taxes and assessments
not yet due and payable;
(iii) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of
the date of recording acceptable to prudent mortgage
lending institutions generally and specifically referred
to in the lender's title insurance policy delivered to
the originator of the Mortgage Loan and (a) specifically
referred to or otherwise considered in the appraisal
made for the originator of the Mortgage Loan or (b)
which do not adversely affect the Appraised Value of the
Mortgaged Property set forth in such appraisal; and
(iv) other matters to which like properties are commonly
subject which do not materially interfere with the
benefits of the security intended to be provided by the
Mortgage or the use, enjoyment, value or marketability
of the related Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable (subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity) and
perfected (A) first lien and first priority security interest with respect to
each First Lien Loan, or (B) second lien and second priority security interest
with respect to each Second Lien Loan, in either case, on the property described
therein and Company has full right to sell and assign the same to Purchaser.
With respect to each Second Lien Loan, the Mortgaged Property was not, as of the
date of origination of such Second Lien Loan, subject to a mortgage, deed of
trust, deed to secure debt or other security instrument creating a lien
subordinate to the lien of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage and any other agreement executed and delivered by a Mortgagor or
guarantor, if applicable, in connection with a Mortgage Loan are genuine, and
each is the legal, valid and binding obligation of the maker thereof enforceable
in accordance with its terms, subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity (including,
without limitation, any provisions therein relating to Prepayment Charges). All
parties to the Mortgage Note, the Mortgage and any other such related agreement
had legal capacity to enter into the Mortgage Loan and to execute and deliver
the Mortgage Note, the Mortgage and any other related agreement, and the
Mortgage Note, the Mortgage and any other such related agreement have been duly
and properly executed by other such related parties. The documents, instruments
and agreements submitted for loan underwriting were not falsified and contain no
untrue statement of material fact or omit to state a material fact required to
be stated therein or necessary to make the information and statements therein
not misleading. As of the Securitization Closing Date, no fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination or servicing of the Mortgage Loan. The Company
has reviewed all of the documents constituting the Servicing File and has made
such inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. Except to the extent the Mortgage
Loan is subject to completion escrows which have been disclosed to and
acknowledged by the Purchaser and which meet the requirements of the
Underwriting Guidelines and as to which a completed Xxxxxx Xxx Form 442 has been
delivered to the Purchaser within sixty (60) days after the related Closing
Date, as of the Securitization Closing Date, the Mortgage Loan has been closed
and 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 improvement and as to disbursements of any
escrow funds therefor have been complied with. As of the Securitization Closing
Date, 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;
(m) Ownership. As of the Closing Date, the Company or MERS was the
sole owner of record and holder of the Mortgage Loan and the indebtedness
evidenced by each Mortgage Note and upon the sale of the Mortgage Loans to the
Purchaser, the Company retained the Mortgage Files or any part thereof with
respect thereto not delivered to the Custodian, the Purchaser or the Purchaser's
designee, in trust only for the purpose of servicing and supervising the
servicing of each Mortgage Loan. As of the Closing Date, upon payment of the
related Purchase Price, the Mortgage Loan was not assigned or pledged, and the
Company had good, indefeasible and marketable title thereto, and had full right
to transfer and sell the Mortgage Loan to the Purchaser free and clear of any
encumbrance, equity, participation interest, lien, pledge, charge, claim or
security interest, and had full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign each
Mortgage Loan pursuant to the Purchase Agreement and immediately following the
sale of each Mortgage Loan, the Purchaser owned such Mortgage Loan free and
clear of any encumbrance, equity, participation interest, lien, pledge, charge,
claim or security interest related to the Company. As of the Closing Date, the
Company intended to relinquish all rights to possess, control and monitor the
Mortgage Loan. Since the Closing Date, the Company has had and will have no
right to modify or alter the terms of the sale of the Mortgage Loan and the
Company has had and will have no obligation or right to repurchase the Mortgage
Loan or substitute another Mortgage Loan, except as provided in the Purchase
Agreement;
(n) Doing Business. As of the Closing Date, all parties which have
had any interest in the Mortgage Loan, whether as mortgagee, assignee, pledgee
or otherwise, are (or, during the period in which they held and disposed of such
interest, were) (1) in compliance with any and all applicable licensing
requirements of the laws of the state wherein the Mortgaged Property is located,
and (2) either (i) organized under the laws of such state, or (ii) qualified to
do business, or exempt from such qualification, in such state, or (iii) a
federal savings and loan association, a savings bank or a national bank having a
principal office in such state, or (3) not doing business in such state;
(o) CLTV, LTV; FICO Score. As of the Securitization Closing Date, no
Mortgage Loan that is a Second Lien Loan has a CLTV in excess of 100% and no
Mortgage Loan has an LTV greater than 100%. At origination of the Mortgage Loan,
the Mortgagor did not have a FICO score of less than 500;
(p) Title Insurance. The 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 Xxxxxxx Mac and each such title insurance
policy is issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and
qualified to do business in the jurisdiction where the Mortgaged Property is
located, insuring the Company, its successors and assigns, as to the first
priority lien (with respect to First Lien Loans) or second priority lien (with
respect to Second Lien Loans) of the Mortgage in the original principal amount
of the Mortgage Loan, subject only to the exceptions contained in clauses (1),
(2) and (3) of paragraph (j) of this Exhibit B, and in the case of Adjustable
Rate Mortgage Loans, against any loss by reason of the invalidity or
unenforceability of the lien resulting from the provisions of the Mortgage
providing for adjustment to 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.
Additionally, such lender's title insurance policy affirmatively insures ingress
and egress, and against encroachments by or upon the Mortgaged Property or any
interest therein. The title policy does not contain any special exceptions
(other than the standard exclusions) for zoning and uses and has been marked to
delete the standard survey exception or to replace the standard survey exception
with a specific survey reading. The Company, its successor and assigns, are the
sole insureds of such lender's title insurance policy, and to the Company's
knowledge as of the Servicing Transfer Date, such lender's title insurance
policy is valid and remains in full force and effect and will be in force and
effect upon the consummation of the purchase transactions contemplated by this
Agreement. Except as disclosed in writing by the Company to the Purchaser on or
prior to the Servicing Transfer Date, no claims have been made under such
lender's title insurance policy, and no prior holder of the related Mortgage,
including the Company, has done, by act or omission, anything which would impair
the coverage of such lender's title insurance policy, including without
limitation, no unlawful fee, commission, kickback or other unlawful compensation
or value of any kind has been or will be received, retained or realized by any
attorney, firm or other person or entity, and no such unlawful items have been
received, retained or realized by the Company;
(q) No Defaults. Other than payments due but not yet 30 days or more
delinquent, as of the Closing Date and to the Company's knowledge as of the
Servicing Transfer Date (except as set forth on the Mortgage Loan Schedule
delivered by the Company to the Purchaser on the Servicing Transfer Date), there
is no default, breach, violation or event which would permit acceleration
existing under the Mortgage or the Mortgage Note and no event which, with the
passage of time or with notice and the expiration of any grace or cure period,
would constitute a default, breach, violation or event which would permit
acceleration, and neither the Company nor any of its affiliates nor any of their
respective predecessors, have waived any default, breach, violation or event
which would permit acceleration. With respect to each Second Lien Loan, as of
the Closing Date and to the Company's knowledge as of the Servicing Transfer
Date, (i) the prior mortgage is in full force and effect, (ii) there is no
default, breach, violation or event of acceleration existing under such prior
mortgage or the related mortgage note and (iii) there is no event which, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law or the related Mortgage requires, the mortgagee under the
Second Lien Loan to receive notice of, and affords such mortgagee an opportunity
to cure any default by payment in full or otherwise under the prior mortgage;
(r) No Mechanics' Liens. Except as insured against by the related
title insurance, as of the Closing Date and to the Company's knowledge as of the
Servicing Transfer Date (except as disclosed in writing by the Company to the
Purchaser on or prior to the Servicing Transfer Date), 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 the law could give rise to such liens)
affecting the related Mortgaged Property which are or may be liens prior to, or
equal or coordinate with, the lien of the related Mortgage;
(s) Location of Improvements; No Encroachments. All improvements
which were considered in determining the Appraised Value of the Mortgaged
Property lay wholly within the boundaries and building restriction lines of the
Mortgaged Property, and no improvements on adjoining properties encroach upon
the Mortgaged Property. As of the Closing Date and to the Company's knowledge as
of the Servicing Transfer Date (except as disclosed in writing by the Company to
the Purchaser on or prior to the Servicing Transfer Date), the Mortgaged
Property and all improvements located on or being part of the Mortgaged Property
are in compliance with all applicable zoning and building laws, ordinances and
regulations;
(t) Origination; Payment Terms. As of the Securitization Closing
Date, 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 Act, a
savings and loan association, a savings bank, a commercial bank, credit union,
insurance company or other similar institution which is supervised and examined
by a federal or state authority. The documents, instruments and agreements
submitted for loan underwriting were not falsified and contain no untrue
statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the information and statements therein not
misleading. No Mortgage Loan contains terms or provisions which would result in
negative amortization. Principal and/or interest payments on the Mortgage Loan
commenced or will commence no more than sixty days after funds were disbursed in
connection with the Mortgage Loan. The Mortgage Interest Rate as well as, with
respect to Adjustable Rate Mortgage Loans, the Lifetime Rate Cap, the Periodic
Rate Floor and the Periodic Rate Cap are as set forth on the related Mortgage
Loan Schedule. The Mortgage Interest Rate is required to be adjusted, with
respect to Adjustable Rate Mortgage Loans, on each Interest Rate Adjustment Date
to equal the Index plus the Gross Margin (rounded up or down to the nearest
0.125%), subject to the Periodic Rate Cap, the Periodic Rate Floor and the
Lifetime Rate Cap. Subject to a "balloon" payment in the case of a Balloon
Mortgage Loan, the Mortgage Note is payable in equal monthly installments of
principal and/or interest, which installments are subject to change due to
adjustments to the Mortgage Interest Rate and/or Monthly Payment on each
Interest Rate Adjustment Date or Monthly Payment Adjustment Date, with interest
calculated and payable in arrears, sufficient to amortize the Mortgage Loan
fully by the stated maturity date (unless the Mortgage Loan is identified on the
Mortgage Loan Schedule as a Balloon Mortgage Loan or an Interest Only Mortgage
Loan), over an original term of not more than thirty years from commencement of
amortization. Unless otherwise specified on the related Mortgage Loan Schedule,
the Mortgage Loan is payable on the first day of each month. There are no
Convertible Mortgage Loans which contain a provision allowing the Mortgagor to
convert the Mortgage Note from an adjustable interest rate Mortgage Note to a
fixed interest rate Mortgage Note. The Due Date of the first payment under the
Mortgage Note is no more than 60 days from the date of the Mortgage Note;
(u) Customary Provisions. The Mortgage contains customary and
enforceable provisions (subject to bankruptcy, insolvency, and similar laws
affecting the rights of creditors and general principles of equity) 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, (i) in the case of a Mortgage designated as a deed
of trust, by trustee's sale, and (ii) otherwise by judicial foreclosure. Upon
default by a Mortgagor on a Mortgage Loan and foreclosure on, or trustee's sale
of, the Mortgaged Property pursuant to the proper procedures, the holder of the
Mortgage Loan will be able to deliver good and merchantable title to the
Mortgaged Property. There is no homestead or other exemption available to a
Mortgagor which would interfere with the right to sell the Mortgaged Property at
a trustee's sale or the right to foreclose the Mortgage, subject to applicable
federal and state laws and judicial precedent with respect to bankruptcy and
right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The
Mortgage Loan was underwritten in accordance with the related Underwriting
Guidelines. The Mortgage Note and Mortgage are on forms acceptable in the
secondary mortgage market and no representations have been made to a Mortgagor
that are inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date, and
to the Company's knowledge as of the Servicing Transfer Date, the Mortgaged
Property is capable of being lawfully occupied under applicable law. As of the
Closing Date, and to the Company's knowledge as of the Servicing Transfer Date,
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. The Company has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Company has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. If the Mortgage Loan is identified as "owner-occupied" in the
related Mortgage Loan Schedule, the Mortgagor represented at the time of
origination of the Mortgage Loan that the Mortgagor would occupy the Mortgaged
Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The 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 in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and as of the Closing Date, and to the
Company's knowledge as of the Servicing Transfer Date, so serves and is named in
the Mortgage (or in the case of a substitution of trustee, is named in a
properly recorded substitution of trustee), and no fees or expenses are or will
become payable by the Purchaser, the Custodian or the Interim Servicer to the
trustee under the deed of trust, except in connection with a trustee's sale
after default by the Mortgagor;
(z) Acceptable Investment. To the Company's knowledge as of the
Servicing Transfer Date, there are no circumstances or conditions with respect
to the Mortgage, the Mortgaged Property, the Mortgagor, the Mortgage File or the
Mortgagor's credit standing that can reasonably be expected to cause private
institutional investors who invest in mortgage loans similar to the Mortgage
Loan to regard the Mortgage Loan as an unacceptable investment, cause the
Mortgage Loan to become delinquent, or adversely affect the value or
marketability of the Mortgage Loan, or cause the Mortgage Loan to prepay during
any period materially faster or slower than the mortgage loans originated by the
Company generally except for the non-prime nature of the Mortgage Loans and the
related Mortgagor's credit. No Mortgaged Property is located in a state, city,
county or other local jurisdiction as described in the related Purchase Price
and Terms Agreement which the Purchaser has determined in its reasonable good
faith discretion would cause the related Mortgage Loan to be ineligible for
whole loan sale or securitization in a transaction consistent with the
prevailing sale and securitization industry (including, without limitation, the
practice of the rating agencies) with respect to substantially similar mortgage
loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the
Mortgage, the Assignment of Mortgage, if any, and any other documents required
to be delivered to the Custodian under this Agreement for each Mortgage Loan
have been delivered to the Custodian. The Company is in possession of a
complete, true and accurate Mortgage File in compliance with Exhibit A to the
Purchase Agreement, except for such documents the originals of which have been
delivered to the Custodian, and the Company has retained copies thereof;
(bb) Condominiums/Planned Unit Developments. As of the
Securitization Closing Date, if the Mortgaged Property is a condominium unit or
a planned unit development (other than a de minimis planned unit development)
such condominium or planned unit development project is in conformance with the
related Underwriting Guidelines;
(cc) Transfer of Mortgage Loans. As of the Securitization Closing
Date, except with respect to MERS Designated Mortgage Loans, the Assignment of
Mortgage with respect to each Mortgage Loan is in recordable form and is
acceptable for recording under the laws of the jurisdiction in which the
Mortgaged Property is located. The transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages by the Company are not subject to the bulk
transfer or similar statutory provisions in effect in any applicable
jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision (subject to applicable law) for the
acceleration of the payment of the unpaid principal balance of the Mortgage Loan
in the event that the Mortgaged Property is sold or transferred without the
prior written consent of the mortgagee thereunder, and such provision is
enforceable, subject to applicable law;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Company, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Company has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. As of the Securitization
Closing Date, any future advances made to the Mortgagor prior to the applicable
Cut-off Date have been consolidated with the outstanding principal amount
secured by the Mortgage, and the secured principal amount, as consolidated,
bears a single interest rate and single repayment term. The lien of the Mortgage
securing the consolidated principal amount is expressly insured as having first
or second, as applicable, lien priority by a title insurance policy, an
endorsement to the policy insuring the mortgagee's consolidated interest or by
other title evidence acceptable to Xxxxxx Xxx and Xxxxxxx Mac. The consolidated
principal amount does not exceed the original principal amount of the Mortgage
Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. As
of the Closing Date, and to the Company's knowledge as of the Securitization
Closing Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Securitization Closing Date), there is no proceeding pending or
threatened for the total or partial condemnation of the Mortgaged Property. As
of the Closing Date, and to the Company's knowledge as of the Securitization
Closing Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Securitization Closing Date), the Mortgaged Property is
undamaged by waste, fire, earthquake or earth movement, windstorm, flood,
tornado or other casualty so as to affect adversely the value of the Mortgaged
Property as security for the Mortgage Loan or the use for which the premises
were intended and each Mortgaged Property is in good repair. As of the Closing
Date, there have not been any condemnation proceedings with respect to the
Mortgaged Property.
(ii) Collection Practices; Escrow Deposits; Interest Rate
Adjustments. The origination, servicing and collection practices with respect to
the Mortgage Loan have been in all respects in compliance with Accepted
Servicing Practices, applicable laws and regulations, and have been in all
respects legal and proper. With respect to escrow deposits and Escrow Payments
(other than with respect to Second Lien Loans for which the mortgagee under the
prior mortgage lien is collecting Escrow Payments), all such payments are in the
possession of, or under the control of, the Company through the Servicing
Transfer Date, and, as of such date, there exist no deficiencies in connection
therewith for which customary arrangements for repayment thereof have not been
made that will be assigned without penalty, premium or cost to the Purchaser.
Each Mortgage Loan is covered by a paid in full, life of loan, tax service
contract that will be assigned without penalty, premium or cost to the
Purchaser. All Escrow Payments collected by the Company have been collected in
full compliance with state and federal law and the provisions of the related
Mortgage Note and Mortgage. An escrow of funds is not prohibited by applicable
law and all escrows that have been established have been established in an
amount sufficient to pay for every item that remains unpaid and has been
assessed but is not yet due and payable. No escrow deposits or Escrow Payments
or other charges or payments due the Company have been capitalized by the
Company under the Mortgage or the Mortgage Note. All Mortgage Interest Rate
adjustments have been made in strict compliance with state and federal law and
the terms of the related Mortgage and Mortgage Note on the related Interest Rate
Adjustment Date. If, pursuant to the terms of the Mortgage Note, another index
was selected for determining the Mortgage Interest Rate, the same index was used
with respect to each Mortgage Note which required a new index to be selected,
and such selection did not conflict with the terms of the related Mortgage Note.
Any and all notices required under applicable law and the terms of the related
Mortgage Note and Mortgage regarding the Mortgage Interest Rate and the Monthly
Payment adjustments have been delivered. Any interest required to be paid by the
Company to the Mortgagor pursuant to state, federal and local law has been
properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan fits within the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. Except as
disclosed in writing by the Company to the Purchaser on or prior to the
Servicing Transfer Date, to the Company's knowledge, no action, inaction or
event has occurred and no state of facts exists or has existed that has resulted
or will result in the exclusion from, denial of, or defense to coverage under
any applicable primary mortgage insurance policy, hazard insurance policy or
bankruptcy bond (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),
irrespective of the cause of such failure of coverage. The Company has caused
or, before or in connection with the transfer of servicing, will cause to be
performed any and all acts required to preserve the rights and remedies of the
Purchaser in any insurance policies applicable to the Mortgage Loans including,
without limitation, any necessary notifications of insurers, assignments of
policies or interests therein, and establishments of coinsured, joint loss payee
and mortgagee rights in favor of the Purchaser. In connection with the placement
of any such insurance, no commission, fee, or other compensation has been or
will be received by the Company or by any officer, director, or employee of the
Company or any designee of the Company or any corporation in which the Company
or any officer, director, or employee had a financial interest at the time of
placement of such insurance;
(ll) No Violation of Environmental Laws. As of the Closing Date, and
to the Company's knowledge as of the Servicing Transfer Date (except as
disclosed in writing by the Company to the Purchaser on or prior to the
Servicing Transfer Date), the Mortgaged Property is free from any and all toxic
or hazardous substances and there exists no violation of any local, state or
federal environmental law, rule or regulation. As of the Closing Date, and to
the Company's knowledge as of the Servicing Transfer Date (except as disclosed
in writing by the Company to the Purchaser on or prior to the Servicing Transfer
Date), 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. As of the Closing Date, based upon customary and prudent residential
mortgage industry underwriting standards, and as of the Servicing Transfer Date
(except as disclosed in writing by the Company to the Purchaser on or prior to
the Servicing Transfer Date), in each case to the Company's knowledge, there is
no violation of any environmental law, rule or regulation with respect to the
Mortgage 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;
(mm) Servicemembers Civil Relief Act. The Mortgagor has not notified
the Company, and the Company has no knowledge of any relief requested or allowed
to the Mortgagor under the Servicemembers Civil Relief Act, or any similar state
statute;
(nn) Appraisal. The Company has delivered to the Purchaser an
appraisal of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser who (i) was licensed in the state where the
Mortgaged Property is located, (ii) had no interest, direct or indirect, in the
Mortgaged Property or in any Mortgage Loan or the security therefor, and (iii)
did not receive compensation that affected the approval or disapproval of the
Mortgage Loan. The appraisal shall have been made within one hundred and eighty
(180) days of the origination of the Mortgage Loan and shall be completed in
compliance with the Uniform Standards of Professional Appraisal Practice, and
all applicable federal and state laws and regulations. If the appraisal was made
more than one hundred and twenty (120) days before the origination of the
Mortgage Loan, the Company shall have received and delivered to the Purchaser a
recertification of the appraisal;
(oo) Disclosure Materials. As of the Securitization Closing Date,
the Mortgagor has, to the extent required by applicable law, executed one or
more statements to the effect that the Mortgagor has, received all disclosure
materials required by applicable law and the Company has complied with all
applicable law with respect to the making of the Mortgage Loans. The Company
shall cause the Interim Servicer to maintain such statement(s) in the Mortgage
File;
(pp) Construction or Rehabilitation of Mortgaged Property. As of the
Securitization Closing Date, the Mortgage Loan was not made to finance the
construction or rehabilitation of a Mortgaged Property or facilitating the
trade-in or exchange of a Mortgaged Property;
(qq) Qualified Mortgage. As of the Closing Date, the Mortgage Loan
is a qualified mortgage under Section 860G(a)(3) of the Code;
(rr) Credit Information. As to each consumer report (as defined in
the Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Company to the Purchaser, the Company has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Company shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Company has in its capacity as a servicer, for each Mortgage
Loan, fully furnished, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g., favorable and
unfavorable) on its borrower credit files to Equifax, Experian and Trans Union
Credit Information Company (three of the credit repositories), on a monthly
basis;
(ss) Leaseholds. As of the Closing Date, and to the Company's
knowledge as of the Servicing Transfer Date, if the Mortgage Loan is secured by
a long-term residential lease, (1) the lessor under the lease holds a fee simple
interest in the land; (2) the terms of such lease expressly permit the
mortgaging of the leasehold estate and the acquisition by the holder of the
Mortgage of the rights of the lessee upon foreclosure or assignment in lieu of
foreclosure or provide the holder of the Mortgage with substantially similar
protections; (3) the terms of such lease do not (a) allow the termination
thereof upon the lessee's default without the holder of the Mortgage being
entitled to receive written notice of, and opportunity to cure, such default,
(b) allow the termination of the lease in the event of damage or destruction as
long as the Mortgage is in existence, (c) prohibit the holder of the Mortgage
from being insured (or receiving proceeds of insurance) under the hazard
insurance policy or policies relating to the Mortgaged Property or (d) permit
any increase in rent other than pre-established increases set forth in the
lease; (4) the original term of such lease is not less than 15 years; (5) the
term of such lease does not terminate earlier than five years after the maturity
date of the Mortgage Note; and (6) the Mortgaged Property is located in a
jurisdiction in which the use of leasehold estates in transferring ownership in
residential properties is a widely accepted practice;
(tt) Prepayment Penalty. The Mortgage Loan is subject to a
prepayment penalty as provided in the related Mortgage Note except as set forth
on the related Mortgage Loan Schedule. With respect to each Mortgage Loan that
has a prepayment penalty feature, each such prepayment penalty is enforceable
(subject to bankruptcy, insolvency, and similar laws affecting the rights of
creditors and general principles of equity) for the benefit of the Purchaser,
and each prepayment penalty is permitted pursuant to applicable law. Each such
prepayment penalty is in an amount not greater than the maximum amount permitted
under applicable law and no such prepayment penalty may be imposed for a term in
excess of five (5) years;
(uu) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(vv) Escrow Analysis. With respect to each Mortgage, the Company has
within the twelve months preceding the Closing Date (unless such Mortgage was
originated within such twelve month period) analyzed the required Escrow
Payments for each Mortgage and adjusted the amount of such payments so that,
assuming all required payments are timely made, any deficiency will be
eliminated on or before the first anniversary of such analysis, or any overage
will be refunded to the Mortgagor, in accordance with RESPA and any other
applicable law;
(ww) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion and as described in the related Purchase Price and
Terms Agreement;
(xx) Single-premium credit life insurance policy. As of the
Securitization Closing Date, in connection with the origination of the Mortgage
Loan, no proceeds from such Mortgage Loan were used to finance or acquire a
single-premium credit life insurance policy, credit disability, credit
unemployment or credit property insurance policy;
(yy) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or an Illinois land trust or a "living trust" and such "living
trust" is in compliance with Xxxxxx Xxx guidelines for such trusts;
(zz) Insurance. The Company has caused or, before or in connection
with the transfer of servicing, will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser;
(aaa) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(bbb) Flood Certification Contract. The Mortgage Loan is covered by
a paid in full, life of loan, transferable flood certification contract that has
been or will be assigned without penalty, cost or premium to the Purchaser;
(ccc) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(ddd) Origination Date. Except as shown on the related Mortgage Loan
Schedule, the date of origination of the Mortgage Loan shall be no earlier than
three (3) months prior to the date such Mortgage Loan was first purchased by the
Purchaser;
(eee) Mortgage Submitted for Recordation. As of the Closing Date,
and to the Company's knowledge as of the Servicing Transfer Date, the Mortgage
either has been or will promptly be submitted for recordation in the appropriate
governmental recording office of the jurisdiction where the Mortgaged Property
is located;
(fff) Endorsements. The Mortgage Note has been endorsed by Company
for its own account and not as a fiduciary, trustee, trustor or beneficiary
under a trust agreement;
(ggg) Accuracy of Information. All information provided to the
Purchaser by the Company with respect to the Mortgage Loan was accurate in all
material respects;
(hhh) No Construction Loans. No Mortgage Loan was made to (a)
facilitate the trade-in or exchange of a Mortgaged Property or (b) finance the
construction or rehabilitation of a Mortgaged Property, unless the Mortgage Loan
is a construction-to-permanent mortgage loan which has been fully disbursed, all
construction work is complete and a completion certificate has been issued;
(iii) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Company has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor; and
(jjj) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction.
EXHIBIT J
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"), dated
as of [_______], 200_, between IXIS Real Estate Capital Inc., a New York
corporation ("IXIS"), and Accredited Home Lenders, Inc., a [__________]
corporation (the "Seller").
WHEREAS, [________________] (the "Depositor"), is acting as
depositor and registrant with respect to the Prospectus, dated
[________________], and the Prospectus Supplement to the Prospectus,
[________________] (the "Prospectus Supplement"), relating to [________________]
Certificates (the "Certificates") to be issued pursuant to a Pooling and
Servicing Agreement, dated as of [________________] (the "P&S"), among the
Depositor, as depositor, [________________], as servicer (the "Servicer"), and
[________________], as trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S,
and [____________________] (the "Underwriter[s]") to enter into the Underwriting
Agreement, dated [____________________] (the "Underwriting Agreement") between
the Depositor and the Underwriter[s], Seller has agreed to provide for
indemnification and contribution on the terms and conditions hereinafter set
forth;
WHEREAS, IXIS purchased from Seller certain of the Mortgage Loans
underlying the Certificates (the "Mortgage Loans") from Seller pursuant to an
Third Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of August 1, 2006 (the "Purchase Agreement"), by and between IXIS and
Seller; and
WHEREAS, pursuant to Section 13 of the Purchase Agreement, Seller
has agreed to indemnify IXIS, the Depositor, the Underwriter[s] and their
respective affiliates, present and former directors, officers, employees and
agents.
NOW THEREFORE, in consideration of the agreements contained herein,
and other valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Seller and IXIS agree as follows:
1. Indemnification and Contribution.
(a) Seller agrees to indemnify and hold harmless IXIS, the
Depositor, the Underwriter[s] and their respective affiliates, present and
former directors, officers, employees and agents and each person, if any, who
controls IXIS, the Depositor, the Underwriter[s] or such affiliate within the
meaning of either Section 15 of the Securities Act of 1933, as amended (the
"1933 Act"), or Section 20 of the Securities Exchange Act of 1934, as amended
(the "1934 Act"), against any and all losses, claims, damages or liabilities,
joint or several, to which they or any of them may become subject under the 1933
Act, the 1934 Act or other federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based in whole or in part
upon (i) any violation of the representation and warranty set forth in Section
2(vii) below or (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus or any omission or
alleged omission to state in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus 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, or any such
untrue statement or omission or alleged untrue statement or alleged omission
made in any amendment of or supplement to the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus and
agrees to reimburse IXIS, the Depositor, the Underwriter[s] or such affiliates
and each such officer, director, employee, agent and controlling person promptly
upon demand for any legal or other expenses reasonably incurred by any of them
in connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that Seller shall be liable in any such case only to the
extent that any such loss, claim, damage, liability or action arises out of, or
is based upon, any untrue statement or alleged untrue statement or omission or
alleged omission made in reliance upon and in conformity with the Seller
Information. The foregoing indemnity agreement is in addition to any liability
which Seller may otherwise have to IXIS, the Depositor, the Underwriter[s] its
affiliates or any such director, officer, employee, agent or controlling person
of IXIS, the Depositor, the Underwriter[s] or their respective affiliates.
As used herein:
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act and
the 1934 Act, as amended from time to time.
"Free Writing Prospectus" means any written communication that
constitutes a "free writing prospectus," as defined in Rule 405 under the 1933
Act.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or
by the staff of the Commission, or as may be provided by the Commission or its
staff from time to time.
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines relating to the Mortgage Loans
set forth in the Prospectus Supplement, ABS Informational and Computational
Material or the Free Writing Prospectus [and static pool information regarding
mortgage loans originated or acquired by the Seller [and included in the
Prospectus Supplement, ABS Informational and Computational Material, the
Offering Circular or the Free Writing Prospectus] [incorporated by reference
from the website located at [______________]].
(b) Promptly after receipt by any indemnified party under this
Section 1 of notice of any claim or the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against any
indemnifying party under this Section 1, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 1 except to the extent it has
been materially prejudiced by such failure; and provided, further, however, that
the failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 1.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except as provided in
the following paragraph, the indemnifying party shall not be liable to the
indemnified party under this Section 1 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties.
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment.
Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for reasonable fees and expenses of counsel, the indemnifying
party agrees that it shall be liable for any settlement of any proceeding
effected without its written consent if (i) such settlement is entered into more
than thirty (30) days after receipt by such indemnifying party of the aforesaid
request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement.
(c) If the indemnification provided for in this Section 1 is
unavailable to an indemnified party, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities, in such proportion as is appropriate to reflect the relative fault
of the indemnifying party and the indemnified party, respectively, in connection
with the statements or omissions that result in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the indemnified party and indemnifying party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission and any other equitable considerations.
(d) The indemnity and contribution agreements contained in this
Section 1 and the representations and warranties set forth in Section 2 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by IXIS, the Depositor, the
Underwriter[s] their respective affiliates, directors, officers, employees or
agents or any person controlling IXIS, the Depositor, the Underwriter[s] or any
such affiliate and (iii) acceptance of and payment for any of the Offered
Certificates.
2. Representations and Warranties. Seller represents and warrants
that:
(i) Seller is validly existing and in good standing under the laws
of its jurisdiction of formation or incorporation, as applicable, and has
full power and authority to own its assets and to transact the business in
which it is currently engaged. Seller is duly qualified to do business and
is in good standing in each jurisdiction in which the character of the
business transacted by it or any properties owned or leased by it requires
such qualification and in which the failure so to qualify would have a
material adverse effect on the business, properties, assets or condition
(financial or otherwise) of Seller;
(ii) Seller is not required to obtain the consent of any other
person or any consent, license, approval or authorization from, or
registration or declaration with, any governmental authority, bureau or
agency in connection with the execution, delivery, performance, validity
or enforceability of this Agreement;
(iii) the execution, delivery and performance of this Agreement by
Seller will not violate any provision of any existing law or regulation or
any order decree of any court applicable to Seller or any provision of the
charter or bylaws of Seller, or constitute a material breach of any
mortgage, indenture, contract or other agreement to which Seller is a
party or by which it may be bound;
(iv) except as disclosed in public filings with the Securities
Exchange Commission by Seller or its affiliates, (a) no proceeding of or
before any court, tribunal or governmental body is currently pending or,
(b) to the knowledge of Seller, threatened against Seller or any of its
properties or with respect to this Agreement or the Offered Certificates,
in either case, which would have a material adverse effect on the
business, properties, assets or condition (financial or otherwise) of
Seller];
(v) Seller has full power and authority to make, execute, deliver
and perform this Agreement and all of the transactions contemplated
hereunder, and has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement. When executed and
delivered, this Agreement will constitute the legal, valid and binding
obligation of each of Seller enforceable in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement
of creditors' rights generally, by the availability of equitable remedies,
and by limitations of public policy under applicable securities law as to
rights of indemnity and contribution thereunder;
(vi) this Agreement has been duly executed and delivered by Seller
[and Initial Servicer]; and
(vii) This representation should only be included if the Mortgage
Loans comprise 20% or more of the loans in the pool. The Indemnifying
Party represents that except as disclosed in writing to the Underwriters
or the Depositor: (i) there are no material legal or governmental
proceedings pending (or known to be contemplated) against the Indemnifying
Party or any Third-Party Originator (as defined in the Purchase
Agreement); and (ii) there are no affiliations, relationships or
transactions relating to the Indemnifying Party or any Third-Party
Originator with respect to any Securitization Transaction (as defined in
the Accredited Purchase Agreement) and the list of parties provided to the
Indemnifying Party in writing by the Depositor on or prior to the date
hereof.
3. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to Seller will be mailed, delivered or
telegraphed and confirmed to Accredited Home Lenders, Inc., 00000 Xxxxxx xx
Xxxxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000; or, if sent to IXIS, will be mailed,
delivered or telegraphed and confirmed to IXIS, 0 Xxxx 00xx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: General Counsel.
4. Miscellaneous. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without giving effect to
the conflict of laws provisions thereof. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their successors and
assigns and the controlling persons referred to herein, and no other person
shall have any right or obligation hereunder. Neither this Agreement nor any
term hereof may be changed, waived, discharged or terminated orally, but only by
an instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought. This Agreement may be
executed in counterparts, each of which when so executed and delivered shall be
considered an original, and all such counterparts shall constitute one and the
same instrument. Capitalized terms used but not defined herein shall have the
meanings provided in the P&S.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective officers hereunto duly authorized,
this __th day of [_____________].
IXIS REAL ESTATE CAPITAL INC.
By:_________________________________
Name:
Title:
By:_________________________________
Name:
Title:
ACCREDITED HOME LENDERS, INC.
By:_________________________________
Name:
Title:
EXHIBIT CC
CIT AGREEMENTS
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated April 30, 2007
("Agreement"), among Natixis Real Estate Capital Inc. ("Assignor"), Xxxxxx
Xxxxxxx ABS Capital I Inc. ("Assignee") and The CIT Group/Consumer Finance, Inc.
(the "Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns to
the Assignee all of the right, title and interest of the Assignor, as purchaser,
in, to and under (a) those certain Mortgage Loans listed on the schedule (the
"Mortgage Loan Schedule") attached hereto as Exhibit A (the "Mortgage Loans")
and (b) except as described below, that certain Second Amended and Restated
Mortgage Loan Purchase and Interim Servicing Agreement, dated as of January 1,
2007 (the "Purchase Agreement"), between the Assignor, as purchaser (the
"Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans and (y) other than as provided below
with respect to the enforcement of representations and warranties, none of the
obligations of the Assignor under the Purchase Agreement.
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
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser (a) under Subsection 9.04 of the Purchase Agreement or (b) to any
premium recapture (i.e., the excess, if any, of the purchase price percentage
over par) in connection with any repurchase pursuant to Subsections 9.03 and
9.05 of the Purchase Agreement or (iii) any right to require the Company to
repurchase a Mortgage Loan pursuant to Subsection 9.05(b) of the Purchase
Agreement unless the related Mortgagor is delinquent with respect to such
Mortgage Loan's first Monthly Payment after origination.
Recognition of the Company
2. 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 Purchase Agreement (solely to the
extent set forth herein) and this Agreement to Natixis Real Estate Capital Trust
2007-HE2 (the "Trust") created pursuant to a Pooling and Servicing Agreement,
dated as of April 1, 2007 (the "Pooling Agreement"), among the Assignee, the
Assignor, Deutsche Bank National Trust Company, as trustee (in such capacity,
including its successors in interest and any successor trustees under the
Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National Association, as
securities administrator (in such capacity, including its successors in interest
and any successor securities administrators under the Pooling Agreement, the
"Securities Administrator"), master servicer (in such capacity, including its
successors in interest and any successor master servicers under the Pooling
Agreement, the "Master Servicer") and Saxon Mortgage Services, Inc., as servicer
(including its successors in interest and any successor servicer under the
Pooling Agreement, the "Servicer"). The Company hereby acknowledges and agrees
that from and after the date hereof (i) the Trust will be the owner of the
Mortgage Loans, (ii) the Company shall look solely to the Trust for performance
of any obligations of the Assignor insofar as they relate to the enforcement of
the representations, warranties and covenants with respect to the Mortgage
Loans, (iii) the Trust (including the Trustee, Securities Administrator, Master
Servicer and the Servicer acting on the Trust's behalf) shall have all the
rights and remedies available to the Assignor, insofar as they relate to the
Mortgage Loans, under the Purchase Agreement, including, without limitation, the
enforcement of the document delivery requirements set forth in Section 6 of the
Purchase Agreement, and shall be entitled to enforce all of the obligations of
the Company thereunder insofar as they relate to the Mortgage Loans, and (iv)
all references to the Purchaser (insofar as they relate to the rights, title and
interest and, with respect to obligations of the Purchaser, only insofar as they
relate to the enforcement of the representations, warranties and covenants of
the Company), the Custodian or the Bailee under the Purchase Agreement insofar
as they relate to the Mortgage Loans, shall be deemed to refer to the Trust
(including the Trustee, Securities Administrator, Master Servicer and the
Servicer acting on the Trust's behalf). Neither the Company nor the Assignor
shall amend or agree to amend, modify, waiver, or otherwise alter any of the
terms or provisions of the Purchase Agreement which amendment, modification,
waiver or other alteration would in any way affect the Mortgage Loans or the
Company's performance under the Purchase Agreement with respect to the Mortgage
Loans without the prior written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf) as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of
the Company's business and will not conflict with, or result in a breach
of, any of the terms, conditions or provisions of the Company's charter
or bylaws or any legal restriction, or any material agreement or
instrument to which the Company is now a party or by which it is bound,
or result in the violation of any law, rule, regulation, order, judgment
or decree to which the Company or its property is subject. The execution,
delivery and performance by the Company of this Agreement have been duly
authorized by all necessary corporate action on part of the Company. This
Agreement has been duly executed and delivered by the Company, and, upon
the due authorization, execution and delivery by the Assignor and the
Assignee, will constitute the valid and legally binding obligation of the
Company, enforceable against the Company in accordance with its terms
except as enforceability may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and by general principles of
equity regardless of whether enforceability is considered in a proceeding
in equity or at law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be
obtained or made by the Company in connection with the execution,
delivery or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency
or other tribunal, which would draw into question the validity of this
Agreement or the Purchase Agreement, or which, either in any one instance
or in the aggregate, would result in any material adverse change in the
ability of the Company to perform its obligations under this Agreement or
the Purchase Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company hereby
represents and warrants, for the benefit of the Assignor, the Assignee and the
Trust (including the Trustee, Securities Administrator, Master Servicer and the
Servicer acting on the Trust's behalf), that the representations and warranties
set forth in Section 9.02 (other than (i) the clause "nor has any payment under
the Mortgage Loan been 30 days or more delinquent at any time since the
origination of the Mortgage Loan" or (ii) the last sentence of section 9.02(b)
as it applies to Monthly Payments due after the date hereof) of the Purchase
Agreement are true and correct as of the date hereof as if such representations
and warranties were made on the date hereof unless otherwise specifically stated
in such representations and warranties, except that (iii) the representation and
warranty set forth in Section 9.02(a) shall, for purposes of this Agreement,
relate to the Mortgage Loan Schedule attached hereto, and (iv) the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that the following representation and warranty is true and
correct as of the date hereof as if such representation and warranty was made of
the date hereof: No Mortgage Loan is a High Cost Loan or Covered Loan, as
applicable, and no Mortgage Loan originated on or after October 1, 2002 through
March 6, 2003 is governed by the Georgia Fair Lending Act. No Mortgage Loan is
covered by the Home Ownership and Equity Protection Act of 1994 and no Mortgage
Loan is in violation of any comparable state or local law.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) in connection with any breach of the representations and warranties made
by the Company set forth in Sections 3 and 4 hereof shall be as set forth in
Subsection 9.03 of the Purchase Agreement as if they were set forth herein
(including without limitation the repurchase and indemnity obligations set forth
therein); provided, however, that the Assignor specifically reserves and does
not assign to the Assignee hereunder any and all right, title and interest in
the Premium Percentage, if any, due in connection with the repurchase of a
Mortgage Loan pursuant to Subsections 9.03, 9.04 and 9.05, or any right to
require the Company to repurchase a Mortgage Loan pursuant to Subsection 9.05(b)
of the Purchase Agreement unless the related Mortgagor is delinquent with
respect to such Mortgage Loan's first Monthly Payment after origination.
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of the
State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf). Any entity into which Assignor, Assignee or Company may be merged or
consolidated shall, without the requirement for any further writing, be deemed
Assignor, Assignee or Company, respectively, hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/ Xxxxxxx Xxx
--------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
NATIXIS REAL ESTATE CAPITAL INC.
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------
Name: Xxxxxxx Xxxxxxx
Its: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
--------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
THE CIT GROUP/CONSUMER FINANCE,
INC.
By: /s/ Xx Xxxxxxx
--------------------------------
Name: Xx Xxxxxxx
Its: Vice President
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
==============================================================================
MORTGAGE LOAN PURCHASE AND INTERIM SERVICING AGREEMENT
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
The CIT Group/Consumer Finance, Inc.
The CIT Group/Consumer Finance, Inc. (NY)
The CIT Group/Consumer Finance, Inc. (TN),
Seller
Dated as of January 1, 2007
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
==============================================================================
TABLE OF CONTENTS
SECTION 1. DEFINITIONS......................................................
SECTION 2. AGREEMENT TO PURCHASE............................................
SECTION 3. MORTGAGE SCHEDULES...............................................
SECTION 4. PURCHASE PRICE...................................................
SECTION 5. EXAMINATION OF MORTGAGE FILES....................................
SECTION 6. CONVEYANCE FROM SELLER TO PURCHASER..............................
Subsection 6.01. Conveyance of Mortgage Loans; Possession of
Servicing Files............................................
Subsection 6.02. Books and Records..........................................
Subsection 6.03. Delivery of Mortgage Loan Documents........................
Subsection 6.04. Quality Control Procedures.................................
Subsection 6.05. MERS Designated Mortgage Loans.............................
SECTION 7. SERVICING OF THE MORTGAGE LOANS..................................
Subsection 7.01. Servicing Rights...........................................
Subsection 7.02. Interim Servicer to Act as Servicer........................
Subsection 7.03. Collection of Mortgage Loan Payments.......................
Subsection 7.04. Remittances................................................
Subsection 7.05. Statements to Purchaser....................................
Subsection 7.06. Annual Statement as to Compliance..........................
Subsection 7.07. Right to Examine Interim Servicer Records..................
Subsection 7.08. Compliance with Gramm Xxxxx Xxxxxx Act of 1999.............
Subsection 7.09. Payment of Taxes, Insurance and Other Charges..............
Subsection 7.10. Maintenance of Hazard Insurance............................
Subsection 7.11. Servicing Compensation.....................................
Subsection 7.12. No Securitizations Serviced by Servicer....................
SECTION 8. TRANSFER OF SERVICING............................................
SECTION 9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER;
REMEDIES FOR BREACH..............................................
Subsection 9.01. Representations and Warranties Regarding the
Seller.....................................................
Subsection 9.02. Representations and Warranties Regarding
Individual Mortgage Loans..................................
Subsection 9.03. Remedies for Breach of Representations and
Warranties.................................................
Subsection 9.04. Repurchase of Mortgage Loans That Prepay in Full...........
Subsection 9.05. Repurchase of Mortgage Loans with First Payment
Defaults...................................................
Subsection 9.06. Purchaser's Right to Review................................
SECTION 10. CLOSING..........................................................
SECTION 11. CLOSING DOCUMENTS................................................
SECTION 12. COSTS............................................................
SECTION 13. COOPERATION OF SELLER WITH A RECONSTITUTION......................
SECTION 14. THE SELLER.......................................................
Subsection 14.01. Additional Indemnification by the Seller; Third
Party Claims...............................................
Subsection 14.02. Merger or Consolidation of the Seller......................
SECTION 15. FINANCIAL STATEMENTS.............................................
SECTION 16. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST...................
SECTION 17. NOTICES..........................................................
SECTION 18. SEVERABILITY CLAUSE..............................................
SECTION 19. COUNTERPARTS.....................................................
SECTION 20. GOVERNING LAW JURISDICTION; CONSENT TO SERVICE OF
PROCESS..........................................................
SECTION 21. INTENTION OF THE PARTIES.........................................
SECTION 22. SUCCESSORS AND ASSIGNS; ASSIGNMENT OF PURCHASE AGREEMENT.........
SECTION 23. WAIVERS..........................................................
SECTION 24. EXHIBITS.........................................................
SECTION 25. GENERAL INTERPRETIVE PRINCIPLES..................................
SECTION 26. REPRODUCTION OF DOCUMENTS........................................
SECTION 27. FURTHER AGREEMENTS...............................................
SECTION 28. RECORDATION OF ASSIGNMENTS OF MORTGAGE...........................
SECTION 29. NO SOLICITATION..................................................
SECTION 30. WAIVER OF TRIAL BY JURY..........................................
SECTION 31. COMPLIANCE WITH REGULATION AB....................................
Subsection 31.01. Intent of the Parties; Reasonableness......................
Subsection 31.02. Additional Representations and Warranties of the
Seller.....................................................
Subsection 31.03. Information to Be Provided by the Seller...................
Subsection 31.04. Indemnification; Remedies..................................
EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF REG AB DISCLOSURE
EXHIBIT C FORM OF OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE INTERIM
SERVICER
EXHIBIT E DELINQUENCY COLLECTION PRACTICES AND PROCEDURES
EXHIBIT F [RESERVED]
EXHIBIT G [RESERVED]
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I SELLER'S UNDERWRITING GUIDELINES
EXHIBIT J FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT K FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
MORTGAGE LOAN PURCHASE AND INTERIM SERVICING AGREEMENT
This MORTGAGE LOAN PURCHASE AND INTERIM SERVICING AGREEMENT (the
"Agreement"), dated as of January 1, 2007, by and between IXIS Real Estate
Capital Inc., a New York corporation, having an office at 0 Xxxx 00xx Xxxxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Purchaser"), and The CIT
Group/Consumer Finance, Inc., a Delaware Corporation, The CIT Group/Consumer
Finance, Inc. (NY), a New York Corporation, The CIT Group/Consumer Finance, Inc.
(TN), a Tennessee Corporation, having an office at 0 XXX Xxxxx, Xxxxxxxxxx, Xxx
Xxxxxx 00000 (the "Seller").
W I T N E S S E T H:
WHEREAS, the Seller desires to sell, from time to time, to the Purchaser,
and the Purchaser desires to purchase, from time to time, from the Seller,
certain first and second lien, adjustable-rate and fixed-rate B/C residential
mortgage loans (the "Mortgage Loans") on a servicing released basis as described
herein, and which shall be delivered in pools of whole loans (each, a "Mortgage
Loan Package") on various dates as provided herein (each, a "Closing Date");
WHEREAS, each Mortgage Loan is secured by a mortgage, deed of trust or
other security instrument creating a first or second lien on a residential
dwelling located in the jurisdiction indicated on the Mortgage Loan Schedule for
the related Mortgage Loan Package;
WHEREAS, the Purchaser and the Seller wish to prescribe the manner of the
conveyance, servicing by the Interim Servicer and control of the Mortgage Loans;
and
WHEREAS, following its purchase of the Mortgage Loans from the Seller, the
Purchaser desires to sell some or all of the Mortgage Loans to one or more
purchasers as a whole loan transfer or a public or private, rated or unrated
mortgage pass-through transaction;
NOW, THEREFORE, in consideration of the premises and mutual agreements set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller agree
as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms shall have
the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan, those
mortgage servicing practices of prudent mortgage lending institutions which
service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agreement: This Mortgage Loan Purchase and Interim Servicing Agreement and
all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value of the
related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property at such time of origination, whichever is less; provided,
however, that in the case of a refinanced Mortgage Loan, such value is based
solely upon the appraisal made, if any, at the time of origination of such
refinanced Mortgage Loan, and (ii) with respect to any Second Lien Loan, the
value, determined pursuant to the Seller's Underwriting Guidelines, of the
related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in Subsection 6.01.
Assignment of Mortgage: An 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 the
sale of the Mortgage to the Purchaser.
Balloon Mortgage Loan: Any Mortgage Loan that requires only payments of
interest until the stated maturity date of the Mortgage Loan or the Monthly
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by stated maturity date of the Mortgage
Loan.
Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a day
on which banking and savings and loan institutions, in the State of New York or
the state in which the Interim Servicer's servicing operations are located, are
authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to time
shall purchase and the Seller from time to time shall sell the Mortgage Loans
listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value and (2) any First Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the First Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are junior or equal in
priority to the First Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage Loan
purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to Appendix
E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The account created and maintained pursuant hereto
which shall be an Eligible Account.
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, to be executed between the Purchaser and the Custodian
and to be dated as of the related Cut-Off Date.
Custodian: The custodian under the Custodial Agreement, or its successor
in interest or assigns, or any successor to the Custodian under the Custodial
Agreement, as therein provided. If at any time there is no Custodial Agreement
in effect with respect to a Mortgage Loan, all references to the Custodian
herein shall be deemed to refer to the Purchaser (or its designee) with respect
to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related Mortgage
Loan Schedule with respect to the related Mortgage Loan Package.
Deemed Material Breach Representation: Each representation identified
as such in Subsection 9.02.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or replaced or
to be replaced with a Qualified Substitute Mortgage Loan by the Seller in
accordance with the terms of this Agreement.
Delinquency Collection Policies and Procedures: The delinquency
collection policies and procedures of the Seller, a copy of which is attached
to this Agreement.
Delinquent Mortgage Loan: Any Mortgage Loan that has failed to make its
scheduled Monthly Payment in the calendar month such payment is due.
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Determination Date: The fifth (5th) Business Day of the month.
Due Date: The day of the month on which the Monthly Payment is due on a
Mortgage Loan, exclusive of any days of grace.
Eligible Account: An account maintained in a non-trust account without
FDIC or other insurance in an institution having (i) one of the two highest
short-term debt ratings, and one of the two highest long-term debt ratings of
S&P or Moody's; or (ii) an unsecured long-term debt rating of at least one of
the two highest unsecured long-term debt ratings of S&P or Moody's. In the event
that the institution holding the account described in the immediately preceding
sentence fails to meet the applicable ratings requirements the Seller shall
proceed under the same standard of care that the Seller would apply to an
account holding only its own funds. Any funds in the Eligible Account may be
commingled with any other funds, including the proceeds of any other mortgage
loans or with funds serviced for other investors.
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.
Exchange Act. The Securities Exchange Act of 1934, as amended.
Xxxxxx Xxx: The Federal National Mortgage Association and its
successors in interest.
FDIC: The Federal Deposit Insurance Corporation and its successors in
interest.
FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage on the
related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
Fixed Rate Mortgage Loan: A fixed rate mortgage loan purchased pursuant
to this Agreement.
Xxxxxxx Mac: The Federal Home Loan Mortgage Corporation and its
successors in interest.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan, the
fixed percentage amount set forth in the related Mortgage Note which amount is
added to the Index in accordance with the terms of the related Mortgage Note to
determine on each Interest Rate Adjustment Date the Mortgage Interest Rate for
such Mortgage Loan.
High Cost Loan: A Mortgage Loan (a) covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual percentage rate" or
total "points and fees" payable by the related Mortgagor (as each such term is
calculated under HOEPA) that exceed the thresholds set forth by HOEPA and its
implementing regulations, including 12 C.F.R. ss. 226.32(a)(1)(i) and (ii), (c)
classified as a "high cost home," "threshold," "covered," "high risk home,"
"predatory" or similar loan under any other 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) or
(d) a Mortgage Loan categorized as High Cost pursuant to Appendix E of Standard
& Poor's Glossary. For avoidance of doubt, the parties agree that this
definition shall apply as of the date such Mortgage Loan is originated to any
law regardless of whether such law is presently, or in the future becomes, the
subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to Appendix E
of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also deemed to include subdivisions thereof such as the FHA
and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, a rate per
annum set forth on Exhibit B to each related Assignment and Conveyance
Agreement.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the interim funder pursuant to the MERS
Procedures Manual.
Interim Servicer: Seller and its successors in interest, and any successor
interim servicer under this Agreement.
Investor: With respect to each MERS Designated Mortgage Loan, the Person
named on the MERS(R) System as the investor pursuant to the MERS Procedures
Manual.
Lifetime Rate Cap: The provision of each Mortgage Note related to an
Adjustable Rate Mortgage Loan which provides for an absolute maximum Mortgage
Interest Rate thereunder. The Mortgage Interest Rate during the terms of each
Adjustable Rate Mortgage Loan shall not at any time exceed the Mortgage Interest
Rate at the time of origination of such Adjustable Rate Mortgage Loan by more
than the amount per annum set forth on the related Mortgage Loan Schedule.
Liquidation Proceeds: Cash received in connection with the liquidation of
a defaulted Mortgage Loan, whether through the sale or assignment of such
Mortgage Loan, trustee's sale, foreclosure sale or otherwise, or the sale of the
related Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the ratio
(expressed as a percentage) of the outstanding principal amount of the Mortgage
Loan as of the Cut-off Date (unless otherwise indicated), to the Appraised Value
of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the Seller has
designated or will designate MERS as, and has taken or will take such action as
is necessary to cause MERS to be, the mortgagee of record, as nominee for the
Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor on the MERS(R)
System.
MERS Procedure Manual: The MERS Procedures Manual, as it may be amended,
supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
Moody's: Xxxxx'x Investors Service, Inc. and its successors in interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on the Mortgaged Property.
Mortgage File: The items pertaining to a particular Mortgage Loan referred
to in Exhibit A annexed hereto, and any additional documents required to be
added to the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: The annual rate of interest borne on a Mortgage
Note with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, 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 required to be delivered to the
Custodian pursuant to Section 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting forth the
following information with respect to each Mortgage Loan in the related Mortgage
Loan Package: (1) the Seller's Mortgage Loan identifying number; (2) the
Mortgagor's 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 investment property; (5) the number and type
of residential units constituting the Mortgaged Property (i.e., a single family
residence, a 2-4 family residence, a unit in a condominium project or a unit in
a planned unit development, manufactured housing); (6) the Mortgage Loan
origination date; (7) the original months to maturity or the remaining months to
maturity from the related Cut-off Date, in any case 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 Loan-to-Value
Ratio at origination; (9) with respect to First Lien Loans, the LTV and with
respect to Second Lien Loans, the CLTV; (10) the Mortgage Interest Rate as of
the related Cut-off Date; (11) the date on which the Monthly Payment was due on
the Mortgage Loan and, if such date is not consistent with the Due Date
currently in effect, such Due Date; (12) the stated maturity date; (13) the
amount of the Monthly Payment as of the related Cut-off Date; (14) the last
payment date as of which a payment was actually applied to the outstanding
principal balance; (15) the original principal amount of the Mortgage Loan; (16)
the 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 and collected
on or before the Cut-off Date; (17) the Interest Rate Adjustment Date; (18) the
Gross Margin; (19) the Lifetime Rate Cap under the terms of the Mortgage Note;
(20) a code indicating the type of Index; (21) the Mortgage Interest Rate as of
origination; (22) the type of Mortgage Loan (i.e., fixed-rate, adjustable-rate,
First Lien, Second Lien); (23) a code indicating the purpose of the loan (i.e.,
purchase, rate and term refinance, equity take-out refinance); (24) a code
indicating the documentation style (i.e., full or stated income); (25) the loan
credit classification (as described in the Underwriting Guidelines); (26) the
applicable Cut-off Date; (27) the applicable Closing Date; (28) a code
indicating whether the Mortgage Loan is a Home Loan; (29) the credit risk score
(FICO score); (30) with respect to the related Mortgagor, the debt-to-income
ratio; (31) with respect to Second Lien Loans, the outstanding principal balance
of the superior lien; (32) the Appraised Value of the Mortgaged Property; (33)
the sale price of the Mortgaged Property if the Mortgage Loan was originated in
connection with the purchase of the Mortgaged Property; (34) the Periodic Rate
Cap under the terms of the Mortgage Note; (35) the Periodic Rate Floor under the
terms of the Mortgage Note; (36) whether such Mortgage Loan provides for a
prepayment penalty; (37) the prepayment penalty period of such Mortgage Loan, if
applicable; (38) a description of the type of prepayment penalty, if applicable;
(39) the MERS Identification Number; (40) whether the Mortgagor represented that
the Mortgagor would occupy the Mortgaged Property as its primary residence and
(41) a code indicating if the Mortgage Loan is a Balloon Mortgage Loan. With
respect to the Mortgage Loans in the aggregate, the Mortgage Loan Schedule shall
set forth the following information, as of the related Cut-off Date: (1) the
number of Mortgage Loans; (2) the current aggregate outstanding principal
balance of the Mortgage Loans; (3) the weighted average Mortgage Interest Rate
of the Mortgage Loans; and (4) the weighted average maturity of the Mortgage
Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the Mortgagor's
real property securing repayment of a related Mortgage Note, consisting of an
unsubordinated estate in fee simple or, 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, in a single parcel or
multiple parcels of real property improved by a residential dwelling as further
described in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its successors in
interest.
Officer's Certificate: A certificate signed by the Chairman of the Board
or the Vice Chairman of the Board or a President or a Vice President and by the
Treasurer or the Secretary or one of the Assistant Treasurers or Assistant
Secretaries of the Seller, and delivered to the Purchaser as required by this
Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel for
the Seller, reasonably acceptable to the Purchaser, substantially in the form
attached hereto.
OTS: Office of Thrift Supervision and its successors in interest.
Periodic Rate Cap: With respect to each Adjustable Rate Mortgage Loan, the
provision of each Mortgage Note which provides for an absolute maximum amount by
which the Mortgage Interest Rate therein may increase on an Interest Rate
Adjustment Date above the Mortgage Interest Rate previously in effect.
Periodic Rate Floor: With respect to each Adjustable Rate Mortgage Loan,
the provision of each Mortgage Note which provides for an absolute maximum
amount by which the Mortgage Interest Rate therein may decrease on an Interest
Rate Adjustment Date below the Mortgage Interest Rate previously in effect.
Person: Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof.
Preliminary Mortgage Schedule: As defined in Section 3.
Premium Percentage: With respect to any Mortgage Loan, a percentage
equal to the excess of the Purchase Price Percentage over 100%.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan which is received in advance of its scheduled Due Date, including
any prepayment penalty or premium thereon and which is not accompanied by an
amount of interest representing scheduled interest due on any date or dates in
any month or months subsequent to the month of prepayment.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements setting forth
the general terms and conditions of the transaction consummated herein and
identifying the Mortgage Loans to be purchased from time to time hereunder, by
and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an amount
equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York corporation, and
its successors in interest and assigns, or any successor to the Purchaser
under this Agreement as herein provided.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in
the Custodial Account by the Seller in the month of substitution); (ii) have a
Mortgage Interest Rate not less than and not more than 1% greater than the
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one (1) year less than that of
the Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan
(i.e., fixed-rate, adjustable-rate with same Periodic Rate Cap, Index and lien
priority); and (v) comply with each representation and warranty (respecting
individual Mortgage Loans) set forth in Section 9 hereof.
Rating Agency: Any of Fitch, Xxxxx'x or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
Reconstitution Agreements: The agreement or agreements entered into by the
Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 13, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement, pooling and servicing
agreement and/or seller/servicer agreements and related custodial/trust
agreement and documents with respect to a Securitization Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation AB),
17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from time to time, and
subject to such clarification and interpretation as have been provided by the
Commission in the adopting release (Asset-Backed Securities, Securities Act
Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff
of the Commission, or as may be provided by the Commission or its staff from
time to time.
REMIC: A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating to 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 5th Business Day of the month.
Repurchase Price: With respect to any Mortgage Loan for which a breach of
a representation or warranty affecting the value of the Mortgage Loan is found,
a price equal to the sum of (i) the then outstanding principal balance of the
Mortgage Loan to be repurchased, (ii) accrued interest thereon at the Mortgage
Interest Rate from the date to which interest had last been paid through the
date prior to such repurchase, provided, however, that accrued and unpaid
interest shall not exceed 90 days of accrued interest following the date
Purchaser receives notice of such breach of a representation or warranty if
Purchaser fails to request Seller to repurchase or cure in accordance with
Section 9.03 within 30 days of Purchaser's receipt of such notice, (iii) the
amount of any outstanding advances owed to any servicer, (iv) in the case of a
Delinquent Mortgage Loan, any Servicing Fee paid by Purchaser in connection with
such Delinquent Mortgage Loan and (v) all costs and expenses incurred by the
Purchaser or any servicer arising out of or based upon such breach, provided,
however, in the event Purchaser fails to provide such Mortgage Loan's pay
history and collection comments, Seller shall not be responsible for such costs
and expenses incurred in the enforcement of the Seller's repurchase obligation
hereunder.
RESPA: Real Estate Settlement Procedures Act, as amended from time to
time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage on
the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction. Any transaction involving either (1) a sale or
other transfer of some or all of the Mortgage Loans directly or indirectly to an
issuing entity in connection with an issuance of publicly offered or privately
placed, rated or unrated mortgage-backed securities or (2) an issuance of
publicly offered or privately placed, rated or unrated securities, the payments
on which are determined primarily by reference to one or more portfolios of
residential mortgage loans consisting, in whole or in part, of some or all of
the Mortgage Loans.
Seller: The CIT Group/Consumer Finance, Inc., a Delaware Corporation,
The CIT Group/Consumer Finance, Inc. (NY), a New York Corporation, The CIT
Group/Consumer Finance, Inc. (TN), a Delaware Corporation, and its successors
in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan an amount equal to 0.50%
per annum computed on the basis of the outstanding principal balance of the
related Mortgage Loan. Such fee shall be payable monthly and shall be pro rated
for any portion of a month during which the Mortgage Loan is serviced by the
Interim Servicer under the this Agreement.
Servicing File: With respect to each Mortgage Loan, the file retained by
the Interim Servicer consisting of originals of all documents in the Mortgage
File which are not delivered to the Purchaser or the Custodian and copies of the
Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and all rights to
service the Mortgage Loans; (b) any payments to or monies received by the
Interim Servicer for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of the Interim
Servicer thereunder; (e) Escrow Payments or other similar payments with respect
to the Mortgage Loans and any amounts actually collected by the Interim Servicer
with respect thereto; (f) all accounts and other rights to payment related to
any of the property described in this paragraph; and (g) any and all documents,
files, records, servicing files, servicing documents, servicing records, data
tapes, computer records, or other information pertaining to the Mortgage Loans
or pertaining to the past, present or prospective servicing of the Mortgage
Loans.
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary, as
may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as described in Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Sections 9.03 and 14.01.
Transfer Date: The date on which the Purchaser, or its designee, shall
receive the transfer of servicing responsibilities and begin to perform the
servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with this Agreement.
Underwriting Guidelines: The underwriting guidelines of the Seller, a copy
of which is attached hereto as Exhibit I and a then-current copy of which shall
be attached as an Exhibit to the related Assignment and Conveyance.
Whole Loan Transfer: Any sale or transfer of some or all of the Mortgage
Loans, other than a Securitization Transaction.
SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser agrees to
purchase from time to time, Mortgage Loans having an aggregate principal balance
on the related Cut-off Date in an amount as set forth in the related Purchase
Price and Terms Agreement, or in such other amount as agreed by the Purchaser
and the Seller as evidenced by the actual aggregate principal balance of the
Mortgage Loans accepted by the Purchaser on each Closing Date.
SECTION 3. Mortgage Schedules.
The Seller from time to time shall provide the Purchaser with certain
information constituting a preliminary listing of the Mortgage Loans to be
purchased on each Closing Date in accordance with the related Purchase Price and
Terms Agreement and this Agreement (each, a "Preliminary Mortgage Schedule").
The Seller shall deliver the Mortgage Loan Schedule for the Mortgage Loans
to be purchased on a particular Closing Date to the Purchaser at least two (2)
Business Days prior to the related Closing Date. The Mortgage Loan Schedule
shall be the related Preliminary Mortgage Schedule with those Mortgage Loans
which the Seller has not funded prior to the related Closing Date deleted.
SECTION 4. Purchase Price.
The Purchase Price for the Mortgage Loans shall be equal to (a) the
Purchase Price Percentage multiplied by the Cut-off Date Balance, plus (b)
accrued and unpaid interest on such principal balance at the Mortgage Interest
Rate of those Mortgage Loans from the date interest was last paid through on the
Mortgage Loan through the day prior to the related Closing Date, inclusive. For
purposes hereof, "Cut-off Date Balance" means the aggregate principal balance,
as of the related Cut-off Date, of the Mortgage Loans listed on the related
Mortgage Loan Schedule, after application of payments of principal due on or
before the related Cut-off Date, to the extent such payments were actually
received, together with any unscheduled principal payments collected prior to
the Cut-off Date. If so provided in the related Purchase Price and Terms
Agreement, portions of the Mortgage Loans shall be priced separately. The
Purchase Price as so determined shall be paid to the Seller on the related
Closing Date by wire transfer of immediately available funds to an account
designated by the Seller in writing.
The Purchaser shall be entitled to: (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected after the
related Cut-off Date, and (3) all payments of interest received after the
related Cut-off Date on the Mortgage Loans net of applicable Servicing Fees.
SECTION 5. Examination of mortgage files.
At least seven (7) Business Days prior to the related Closing Date, the
Seller shall (i) either (a) deliver to the Purchaser or its designee in escrow,
for examination with respect to each Mortgage Loan to be purchased, the related
Mortgage File, including a copy of the Assignment of Mortgage (except with
respect to each MERS Designated Mortgage Loan), pertaining to each Mortgage
Loan, or (b) make the related Mortgage File available to the Purchaser for
examination at such other location as shall otherwise be acceptable to the
Purchaser and (ii) deliver to the Purchaser copies of the credit and servicing
files (collectively, the "Credit Files"). Such examination of the Mortgage Files
may be made by the Purchaser or its designee at any reasonable time before or
after the related Closing Date. If the Purchaser makes such examination prior to
the related Closing Date and determines, in its sole discretion, that any
Mortgage Loans are unacceptable to the Purchaser for any reason, such Mortgage
Loans shall be deleted from the related Mortgage Loan Schedule, and may be
replaced by a Qualified Substitute Mortgage Loan (or Loans) acceptable to the
Purchaser. The Purchaser may, at its option and without notice to the Seller,
purchase some or all of the Mortgage Loans without conducting any partial or
complete examination. The fact that the Purchaser or its designee has conducted
or has failed to conduct any partial or complete examination of the Mortgage
Files or the Credit Files shall not impair in any way the Purchaser's (or any of
its successor's) rights to demand repurchase, substitution or other remedy as
provided in this Agreement. In the event that the Seller fails to deliver the
Credit Files with respect to any Mortgage Loan, the Seller shall, upon the
request of the Purchaser, repurchase such Mortgage Loan at the price and in the
manner specified in Subsection 9.03.
SECTION 6. Conveyance From Seller to Purchaser.
Subsection 6.01. Conveyance of Mortgage Loans; Possession of Servicing
Files.
The Seller, simultaneously with the delivery of the Mortgage Loan Schedule
with respect to the related Mortgage Loan Package to be purchased on each
Closing Date, shall execute and deliver an Assignment and Conveyance Agreement
in the form attached hereto as Exhibit H (the "Assignment and Conveyance
Agreement"). The Seller shall cause the Servicing File retained by the Interim
Servicer pursuant to this Agreement to be appropriately identified in the
Seller's computer system and/or books and records, as appropriate, to clearly
reflect the sale of the related Mortgage Loan to the Purchaser. The Seller shall
cause the Interim Servicer to release from its custody the contents of any
Servicing File retained by it only in accordance with this Agreement except when
such release is required in connection with a repurchase of any such Mortgage
Loan pursuant to Subsection 9.03.
Subsection 6.02. Books and Records.
Record title to each Mortgage as of the related Closing Date shall be in
the name of MERS. Notwithstanding the foregoing, each Mortgage and related
Mortgage Note shall be possessed solely by the Purchaser or the appropriate
designee of the Purchaser, as the case may be. All rights arising out of the
Mortgage Loans including, but not limited to, all funds received by the Seller
or the Interim Servicer after the related Cut-off Date on or in connection with
a Mortgage Loan shall be vested in the Purchaser or one or more designees of the
Purchaser; provided, however, that all funds received on or in connection with a
Mortgage Loan shall be received and held by the Seller or the Interim Servicer
in trust for the benefit of the Purchaser or the appropriate designee of the
Purchaser, as the case may be, as the owner of the Mortgage Loans pursuant to
the terms of this Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's balance
sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to be responsible for
maintaining, and shall maintain, a complete set of books and records for each
Mortgage Loan which shall be marked clearly to reflect the ownership of each
Mortgage Loan by the Purchaser. In particular, the Seller shall or shall cause
the Interim Servicer to maintain in its possession, available for inspection by
the Purchaser, and shall deliver to the Purchaser upon reasonable request,
evidence of compliance with all federal, state and local laws, rules and
regulations, including but not limited to documentation as to the method used in
determining the applicability of the provisions of the National Flood Insurance
Act of 1968, as amended, to the Mortgaged Property, documentation evidencing
insurance coverage and periodic inspection reports.
Subsection 6.03. Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later than seven
(7) Business Days prior to the related Closing Date those Mortgage Loan
Documents set forth on Exhibit A hereto with respect to each Mortgage Loan set
forth on the related Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian.
The Seller shall or shall cause the Interim Servicer to forward to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
original documents evidencing an assumption, modification, consolidation or
extension of any Mortgage Loan entered into in accordance with this Agreement
within two (2) weeks of their execution, provided, however, that the Seller
shall provide the Custodian, or to such other Person as the Purchaser shall
designate in writing, with a certified true copy of any such document submitted
for recordation within two (2) weeks of its execution, and shall promptly
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 one hundred eighty (180) of its submission
for recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within one hundred eighty (180) days following the
Closing Date (other than with respect to the Assignments of Mortgage which shall
be delivered to the Custodian in blank and recorded subsequently by the
Purchaser or its designee), and in the event that the Seller does not cure such
failure within sixty (60) days of discovery or receipt of written notification
of such failure from the Purchaser, the related Mortgage Loan shall, upon the
request of the Purchaser, be repurchased by the Seller at the price and in the
manner specified in Subsection 9.03. The foregoing repurchase obligation shall
not apply in the event that the Seller cannot deliver such original or copy of
any document submitted for recordation to the appropriate public recording
office within the specified period due to a delay caused by the recording office
in the applicable jurisdiction, provided that (i) the Seller shall deliver a
recording receipt of such recording office or, if such recording receipt is not
available, an officer's certificate of a servicing officer of the Seller,
confirming that such documents have been accepted for recording (upon request of
the Purchaser and delivery by the Purchaser to the Seller of a schedule of the
related Mortgage Loans, the Seller shall reissue and deliver to the Purchaser or
its designee said officer's certificate relating to the related Mortgage Loans),
and (ii) such document is delivered within twelve (12) months of the related
Closing Date.
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee. The Purchaser or the Purchaser's designee
shall be responsible for recording the Assignments of Mortgage and shall be
reimbursed by the Seller for the costs associated therewith pursuant to the
preceding sentence.
Subsection 6.04. Quality Control Procedures.
The Seller shall, or shall cause the Interim Servicer to, have an internal
quality control program that verifies in a manner consistent with accepted
industry procedures, on a regular basis, the existence and accuracy of the legal
documents, credit documents, property appraisals, and underwriting decisions.
The program shall include evaluating and monitoring the overall quality of the
Seller's loan production and the servicing activities of the Interim Servicer.
The program is to ensure that the Mortgage Loans are originated and serviced in
accordance with Accepted Servicing Practices and the Underwriting Guidelines;
guard against dishonest, fraudulent, or negligent acts; and guard against errors
and omissions by officers, employees, or other authorized persons.
Subsection 6.05. MERS Designated Mortgage Loans.
With respect to each MERS Designated Mortgage Loan, the Seller shall, on
or prior to the related Closing Date, designate the Purchaser as the Investor
and the Custodian as custodian, and no Person shall be listed as Interim Funder
on the MERS System. In addition, on or prior to the related Closing Date, Seller
shall provide the Custodian and the Purchaser with a MERS Report listing the
Purchaser as the Investor, the Custodian as custodian and no Person as Interim
Funder with respect to each MERS Designated Mortgage Loan.
SECTION 7. Servicing of the Mortgage Loans.
Subsection 7.01. Servicing Rights.
The Mortgage Loans have been sold by the Seller to the Purchaser on a
servicing released basis. Subject to, and upon the terms and conditions of this
Agreement, the Seller hereby sells, transfers, assigns, conveys and delivers to
the Purchaser the Servicing Rights.
Subsection 7.02. Interim Servicer to Act as Servicer.
With respect to the Mortgage Loans in each Mortgage Loan Package purchased
by the Purchaser, from and after the related Closing Date, the Interim Servicer,
as an independent contractor, shall service and administer the Mortgage Loans
during the related Interim Period and shall have full power and authority to do
any and all things in connection with such servicing and administration which
the Interim Servicer may deem necessary or desirable, consistent with the terms
of this Agreement and Accepted Servicing Practices.
The Interim Servicer may not waive, modify or vary any term of any
Mortgage Loan or consent to the postponement of strict compliance with any such
term or in any manner grant indulgence to any Mortgagor. Without limiting the
generality of the foregoing, the Interim Servicer shall continue, and is hereby
authorized and empowered, to execute and deliver on behalf of itself and the
Purchaser, all instruments of satisfaction or cancellation, or of partial or
full release, discharge and all other comparable instruments, with respect to
the Mortgage Loans and with respect to the Mortgaged Properties. If reasonably
required by the Interim Servicer, the Purchaser shall furnish the Interim
Servicer with any powers of attorney and other documents necessary or
appropriate to enable the Interim Servicer to carry out its servicing and
administrative duties under this Agreement.
In servicing and administering the Mortgage Loans, the Interim Servicer
shall employ procedures (including collection procedures) and exercise the same
care that it customarily employs and exercises in servicing and administering
mortgage loans for its own account, giving due consideration to Accepted
Servicing Practices where such practices do not conflict with the requirements
of this Agreement, the Mortgage Loan Documents or applicable law, and the
Purchaser's reliance on the Interim Servicer.
The Interim Servicer shall keep at its servicing office books and records
in which, subject to such reasonable regulations as it may prescribe, the
Interim 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.
Subsection 7.03. Collection of Mortgage Loan Payments.
Continuously for thirty (30) days after the related Closing Date, the
Interim Servicer shall proceed diligently to collect all payments due under each
Mortgage Loan serviced by Interim Servicer when the same shall become due and
payable and shall, to the extent such procedures shall be consistent with this
Agreement follow such collection procedures as it follows with respect to
mortgage loans comparable to the Mortgage Loans and held for its own account.
Interim Servicer shall segregate in its books and records all funds collected
and received in connection with the Mortgage Loans. Interim Servicer shall
deposit all collections of Mortgage Loan payments into the Custodial Account.
Subsection 7.04. Remittances.
On each Remittance Date, the Interim Servicer shall remit by wire transfer
of immediately available funds to the Purchaser all amounts reported on the
Monthly Remittance Advice.
Subsection 7.05. Statements to Purchaser.
Not later than the Remittance Date, the Interim Servicer shall furnish to
the Purchaser a Monthly Remittance Advice, with a trial balance report attached
thereto in the form of Exhibit K annexed hereto in electronic medium mutually
acceptable to the parties as to the preceding remittance and the period ending
on the preceding Remittance Date. At a minimum, the trial balance report must
contain the fields attached hereto on Schedule 1.
In addition, not more than 60 days after the end of each calendar year,
the Interim Servicer 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.
Such obligation of the Interim Servicer shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Interim Servicer pursuant to any requirements of the Internal
Revenue Code as from time to time are in force.
The Interim Servicer shall prepare and file any and all tax returns,
information statements or other filings required to be delivered to any
governmental taxing authority or to the Purchaser pursuant to any applicable law
with respect to the Mortgage Loans and the transactions contemplated hereby. In
addition, the Interim Servicer shall provide the Purchaser with such information
concerning the Mortgage Loans as is necessary for the Purchaser to prepare its
federal income tax return as the Purchaser may reasonably request from time to
time.
Subsection 7.06. Annual Statement as to Compliance.
So long as any Mortgage Loans are being serviced hereunder, upon written
request, the Interim Servicer shall deliver to the Purchaser, on or before March
1st each year beginning March 1, 2008, and on the related Transfer Date an
Officer's Certificate, stating that (i) a review of the activities of the
Interim Servicer during the preceding calendar year and of performance under
this Agreement has been made under such officer's supervision, and (ii) the
Interim Servicer has complied fully with the provisions of Article II and
Article IV, and (iii) to the best of such officer's knowledge, based on such
review, the Interim Servicer has fulfilled all its obligations under this
Agreement throughout such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officer and the nature and status thereof and the action being taken by the
Interim Servicer to cure such default.
Subsection 7.07. Right to Examine Interim Servicer Records.
So long as any Mortgage Loans are being serviced hereunder and for a
reasonable period after servicing has been transferred, the Purchaser shall have
the right to examine and audit any and all of the books, records, or other
material information of the Interim Servicer, whether held by the Interim
Servicer or by another on its behalf, with respect to or concerning this
Agreement or the Mortgage Loans, during business hours or at such other times as
may be reasonable under applicable circumstances, upon reasonable advance
notice.
Subsection 7.08. Compliance with Gramm Xxxxx Xxxxxx Act of 1999.
With respect to each Mortgage Loan and the related Mortgagor, the Interim
Servicer shall comply with Title V of the Gramm Xxxxx Xxxxxx Act of 1999, as
amended, and all applicable regulations and guidelines promulgated thereunder,
and shall provide all notices required thereunder using the notice language
supplied by the Purchaser.
Subsection 7.09. Payment of Taxes, Insurance and Other Charges.
With respect to each Mortgage Loan, the Interim Servicer shall maintain
accurate records reflecting the status of ground rents, taxes, assessments,
water rates, sewer rents, and other charges which are or may become a lien upon
the Mortgaged Property and the status of fire and hazard insurance coverage and
shall obtain, from time to time, all bills for the payment of such charges
(including renewal premiums) and shall effect payment thereof prior to the
applicable penalty or termination date, employing for such purpose deposits of
the Mortgagor in the Escrow Account which shall have been estimated and
accumulated by the Interim Servicer in amounts sufficient for such purposes, as
allowed under the terms of the Mortgage.
Subsection 7.10. Maintenance of Hazard Insurance.
The Interim Servicer shall cause to be maintained for each Mortgage Loan,
hazard insurance such that all buildings upon the Mortgaged Property are insured
by a generally acceptable insurer rated B or better in the current Best's Key
Rating Guide ("Best's") against loss by fire, hazards of extended coverage and
such other hazards as are customary in the area where the Mortgaged Property is
located, in an amount which is at least equal to the lesser of (i) the maximum
insurable value of the improvements securing such Mortgage Loan and (ii) the
greater of (a) the outstanding principal balance of the Mortgage Loan and (b) an
amount such that the proceeds thereof shall be sufficient to prevent the
Mortgagor or the loss payee from becoming a co-insurer.
Subsection 7.11. Servicing Compensation.
As consideration for servicing the Mortgage Loans during the period from
the Closing Date up to but not including the Transfer Date, the Seller shall
retain the Interim Servicing Fee.
Subsection 7.12. No Securitizations Serviced by Servicer.
Notwithstanding anything to the contrary contained herein, Purchaser
agrees that Sellers shall not be a named servicer in, and shall not report to a
master servicer in, any Mortgage Loans which have been securitized by Purchaser
during the Interim Servicing Period.
SECTION 8. Transfer of Servicing.
On the applicable Transfer Date, the Purchaser, or its designee, shall
assume all servicing responsibilities related to, and the Seller shall cause the
Interim Servicer to cease all servicing responsibilities related to, the related
Mortgage Loans subject to such Transfer Date. The Transfer Date shall be the
date determined in accordance with this Agreement.
On or prior to the applicable Transfer Date, the Seller shall, at its sole
cost and expense, take such steps as may be necessary or appropriate to
effectuate and evidence the transfer of the servicing of the related Mortgage
Loans to the Purchaser, or its designee, including but not limited to the
following:
(a) Notice to Mortgagors. The Seller shall mail to the Mortgagor of each
related Mortgage Loan a letter advising such Mortgagor of the transfer of the
servicing of the related Mortgage Loan to the Purchaser, or its designee, in
accordance with the Xxxxxxxx Xxxxxxxx National Affordable Housing Act of 1990;
provided, however, the content and format of the letter shall have the prior
approval of the Purchaser. The Seller shall cause the Interim Servicer to
provide the Purchaser with copies of all such related notices no later than the
Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The Seller shall
transmit to the applicable taxing authorities and insurance companies (including
primary mortgage insurance policy insurers, if applicable) and/or agents,
notification of the transfer of the servicing to the Purchaser, or its designee,
and instructions to deliver all notices, tax bills and insurance statements, as
the case may be, to the Purchaser from and after the Transfer Date. The Seller
shall provide the Purchaser with copies of all such notices no later than the
Transfer Date.
(c) Delivery of Servicing Records. The Seller shall forward to the
Purchaser, or its designee, all servicing records and the Servicing File in the
Interim Servicer's possession relating to each related Mortgage Loan including
the information enumerated in this Agreement (with respect to each such Mortgage
Loan, for an interim period, as specified herein).
(d) Escrow Payments. The Seller shall cause the Interim Servicer to
provide the Purchaser, or its designee, with immediately available funds by wire
transfer in the amount of the net escrow balance associated with the related
Mortgage Loans. The Seller shall cause the Interim Servicer to provide the
Purchaser with an accounting statement, in electronic format acceptable to the
Purchaser in its sole discretion, of escrow balance sufficient to enable the
Purchaser to reconcile the amount of such payment with the accounts of the
Mortgage Loans. Additionally, the Seller shall wire transfer to the Purchaser
the amount of any agency, trustee or prepaid Mortgage Loan payments and all
other similar amounts held by the Seller.
(e) Payoffs and Assumptions. The Seller shall provide to the Purchaser, or
its designee, copies of all assumption and payoff statements generated by the
Interim Servicer on the related Mortgage Loans from the related Cut-off Date to
the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Seller on each related Mortgage Loan
shall be properly applied by the Seller to the account of the particular
Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of any
related Monthly Payments received by the Seller after the Transfer Date shall be
forwarded to the Purchaser by overnight mail on the first Wednesday following
receipt. The Seller shall notify the Purchaser of the particulars of the
payment, which notification requirement shall be satisfied if the Seller
forwards with its payment sufficient information to permit appropriate
processing of the payment by the Purchaser.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication errors;
(ii) The party receiving notice of a misapplied payment occurring prior to
the applicable Transfer Date and discovered after the Transfer Date shall
immediately notify the other party within one hundred fifty (150) days of the
Transfer Date. The Seller shall not be responsible for investigating, or
liable for, any immaterial misapplied payment discovered after one hundred
fifty (150) days after the Transfer Date;
(iii) If a misapplied payment which occurred prior to the Transfer Date
cannot be identified and said misapplied payment has resulted in a material
shortage in a Custodial Account, the Seller shall be liable for the amount of
such shortage. The Seller shall reimburse the Purchaser for the amount of
such shortage within thirty (30) days after receipt of written demand
therefor from the Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer Date has
created an improper Purchase Price as the result of an inaccurate outstanding
principal balance, an adjustment shall be made to the party shorted by the
improper payment application after notice thereof by the other party; and
(v) Any check issued under the provisions of this Section 8(h) shall be
accompanied by a statement indicating the corresponding Seller and/or the
Purchaser Mortgage Loan identification number and an explanation of the
allocation of any such payments.
(i) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be in
accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on the Transfer Date, reconcile
principal balances and make any monetary adjustments necessary to accurately and
correctly reconcile all servicing activities with respect to such Mortgage Loan,
including all payments received and all advances made relating to such Mortgage
Loan. Any such monetary adjustments will be transferred between the Seller and
the Purchaser as appropriate. Purchaser shall provide written notice no later
than one hundred fifty (150) days after the Transfer Date of any purported
reconciliation errors. The Seller shall not be responsible for investigating, or
liable for, any immaterial reconciliation errors discovered after one hundred
fifty (150) days after the Transfer Date.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer to
file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be
filed on or before February 1 of the year following the Transfer Date in
relation to the servicing and ownership of the related Mortgage Loans. The
Seller shall provide copies of such forms to the Purchaser upon request and
shall reimburse the Purchaser for any costs or penalties incurred by the
Purchaser due to the Seller's failure to comply with this paragraph.
SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 9.01. Representations and Warranties Regarding the Seller.
The Seller represents, warrants and covenants to the Purchaser that as of
the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller are corporations duly
organized, validly existing and in good standing under the laws of the state of
Delaware, in the case of The CIT Group/Consumer Finance, Inc., New York in the
case of The CIT Group/Consumer Finance, Inc. (NY), and Tennessee, in the case of
The CIT Group/Consumer Finance, Inc. (TN) and have all licenses necessary to
carry on its business as now being conducted and is licensed, qualified and in
good standing in each state wherein it owns or leases any material properties or
where a Mortgaged Property is located, if the laws of such state require
licensing or qualification in order to conduct business of the type conducted by
the Seller, and in any event the Seller is in compliance with the laws of any
such state to the extent necessary to ensure the enforceability of the related
Mortgage Loan and the servicing of such Mortgage Loan in accordance with the
terms of this Agreement; the Seller has the full corporate power, authority and
legal right to hold, transfer and convey the Mortgage Loans and to execute and
deliver this Agreement and to perform its obligations hereunder and thereunder;
the execution, delivery and performance of this Agreement (including all
instruments of transfer to be delivered pursuant to this Agreement) by the
Seller and the consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized; this Agreement and all agreements
contemplated hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Seller, regardless of
whether such enforcement is sought in a proceeding in equity or at law; and all
requisite corporate or other action has been taken by the Seller to make this
Agreement and all agreements contemplated hereby valid and binding upon the
Seller in accordance with their terms;
(b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Seller, and the transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Seller pursuant to this Agreement are not subject to the
bulk transfer or any similar statutory provisions in effect in any applicable
jurisdiction;
(c) No Conflicts. Neither the execution and delivery of this Agreement,
the acquisition or origination of the Mortgage Loans by the Seller, the sale of
the Mortgage Loans to the Purchaser, the consummation of the transactions
contemplated hereby and thereby, nor the fulfillment of or compliance with the
terms and conditions of this Agreement, will conflict with or result in a breach
of any of the terms, conditions or provisions of the Seller's charter, by-laws
or other organizational documents or any legal restriction or any agreement or
instrument to which the Seller is now a party or by which it is bound, or
constitute a default or result in an acceleration under any of the foregoing, or
result in the violation of any law, rule, regulation, order, judgment or decree
to which the Seller or its property is subject, or result in the creation or
imposition of any lien, charge or encumbrance that would have an adverse effect
upon any of its properties pursuant to the terms of any mortgage, contract, deed
of trust or other instrument, or impair the ability of the Purchaser to realize
on the Mortgage Loans, impair the value of the Mortgage Loans, or impair the
ability of the Purchaser to realize the full amount of any insurance benefits
accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer is
duly qualified, licensed, registered and otherwise authorized under all
applicable federal, state and local laws, and regulations, if applicable, and is
in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller[, on behalf of the Interim
Servicer,] acknowledges and agrees that the Servicing Fee, represents reasonable
compensation for performing such services and that the entire Servicing Fee
shall be treated by the Interim Servicer, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans pursuant
to this Agreement;
(f) Ability to Perform; Solvency. The Seller does not believe, nor does it
have any reason or cause to believe, that it cannot perform each and every
covenant contained in this Agreement. The Seller is solvent and the sale of the
Mortgage Loans will not cause the Seller to become insolvent. The sale of the
Mortgage Loans is not undertaken with the intent to hinder, delay or defraud any
of Seller's creditors;
(g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or which, either in any one instance or in the
aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Seller contemplated herein, or which
would be likely to impair the ability of the Seller to perform under the terms
of this Agreement;
(h) No Consent Required. No consent, approval, authorization or order of,
or registration or filing with, or notice to any court or governmental agency or
body including HUD, the FHA or the Department of Veterans Affairs is required
for the execution, delivery and performance by the Seller of or compliance by
the Seller with this Agreement or the Mortgage Loans, the delivery of a portion
of the Mortgage Files to the Custodian or the sale of the Mortgage Loans or the
consummation of the transactions contemplated by this Agreement, or if required,
such approval has been obtained prior to the related Closing Date;
(i) Selection Process. The Mortgage Loans were selected from among the
outstanding one- to four-family mortgage loans in the Seller's portfolio at the
related Closing Date as to which the representations and warranties set forth in
Subsection 9.02 could be made and such selection was not made in a manner so as
to affect adversely the interests of the Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description of the pool
characteristics for the applicable Mortgage Loan Package delivered pursuant to
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any information,
statement, tape, diskette, report, form, or other document furnished or to be
furnished pursuant to this Agreement or any Reconstitution Agreement or in
connection with the transactions contemplated hereby (including any
Securitization Transaction or Whole Loan Transfer) contains or will contain any
untrue statement of fact or omits or will omit to state a fact necessary to make
the statements contained herein or therein not misleading;
(l) Financial Statements. Seller's parent, CIT Group Inc. is a publicly
traded company and its financial statements are available at
xxx.xxx.xxx/xxxx/Xxxxxxxx Relationship/FinancialData.htm. All such financial
statements fairly present the pertinent results of operations and changes in
financial position for each of such periods and the financial position at the
end of each such period of the CIT Group Inc. and its subsidiaries and have been
prepared in accordance with generally accepted accounting principles of the
United States 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 CIT Group Inc. since
the date of the Seller's financial statements that would have an adverse effect
on Seller's ability to perform its obligations under this Agreement;
(m) No Brokers. The Seller has not dealt with any broker, investment
banker, agent or other person that may be entitled to any commission or
compensation in connection with the sale of the Mortgage Loans;
(n) Sale Treatment. The Seller intends to reflect the transfer of the
Mortgage Loans as a sale on the books and records of the Seller and the Seller
has determined that the disposition of the Mortgage Loans pursuant to this
Agreement will be afforded sale treatment for tax and accounting purposes;
(o) Owner of Record. Except for MERS Designated Mortgage Loans, the Seller
is the owner of record of each Mortgage and the indebtedness evidenced by each
Mortgage Note, and upon the sale of the Mortgage Loans to the Purchaser, the
Seller will retain the Mortgage Files with respect thereto in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan;
(p) Seller's Origination. The Seller's decision to originate any mortgage
loan or to deny any mortgage loan application is an independent decision based
upon Seller's underwriting guidelines, and is in no way made as a result of
Purchaser's decision to purchase, or not to purchase, or the price Purchaser may
offer to pay for, any such mortgage loan, if originated; and
(q) Compliance with Anti-Money Laundering Laws. The Seller has complied
with all applicable anti-money laundering laws, regulations and executive
orders, including without limitation the USA Patriot Act of 2001 (collectively,
the "Anti-Money Laundering Laws");
(r) Delivery to the Custodian. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to the Custodial Agreement shall be
delivered to the Custodian all in compliance with the specific requirements of
the Custodial Agreement. With respect to each Mortgage Loan, the Seller will be
in possession of a complete Mortgage File in compliance with Exhibit A hereto,
except for such documents as will be delivered to the Custodian; and
(s) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan, will fully furnish, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files to
Equifax, Experian and Trans Union Credit Information Company (three of the
credit repositories), on a monthly basis.
Subsection 9.02. Representations and Warranties Regarding Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that, as to
each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the Mortgage
Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the Closing
Date under the terms of the Mortgage Note have been made and credited. As of the
Closing Date, no payment required under the Mortgage Loan is thirty (30) days or
more delinquent nor has any payment under the Mortgage Loan been thirty (30)
days or more delinquent at any time since the origination of the Mortgage Loan.
The first Monthly Payment after the Cut-off Date shall be made with respect to
the Mortgage Loan within the calendar month such Monthly Payment is due, all in
accordance with the terms of the related Mortgage Note;
(c) No Outstanding Charges. There are no defaults in complying with the
terms of the Mortgage securing the Mortgage Loan, 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
provided an escrow of funds has been established in an amount sufficient to pay
for every such item which remains unpaid and which has been assessed but is not
yet due and payable. Except for (A) payments in the nature of escrow payments
and (B) interest accruing from the date of the Mortgage Note or date of
disbursement of the Mortgage Loan proceeds, whichever is earlier to the day
which precedes by one (1) month the Due Date of the first installment of
principal and interest, including, without limitation, taxes and insurance
payments, the Seller has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and Mortgage
have not been impaired, waived, altered or modified in any respect, from the
date of origination except by a written instrument which has been recorded, if
necessary to protect the interests of the Purchaser, and which has been
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. No
Mortgagor has been released, in whole or in part, except in connection with an
assumption agreement, approved by the title insurer, to the extent required by
the policy, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) No Defenses. The Mortgage Loan is 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 either the
Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject to
any right of rescission, set-off, counterclaim or defense, including without
limitation the defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all buildings
or other improvements upon the Mortgaged Property are insured by a generally
acceptable insurer against loss by fire, hazards of extended coverage and such
other hazards that would be acceptable to a prudent lender making mortgage loans
similar to the Mortgage Loans. If required by the National Flood Insurance Act
of 1968, as amended, each Mortgage Loan is covered by a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration in effect, that would be acceptable to a prudent lender making
mortgage loans similar to the Mortgage Loans. All individual insurance policies
contain a standard mortgagee clause naming the Seller and its successors and
assigns as mortgagee, and all premiums thereon have been paid and such policies
may not be reduced, terminated or cancelled without thirty (30) days' prior
written notice to the mortgagee. The Mortgage obligates the Mortgagor thereunder
to maintain the hazard insurance policy at the Mortgagor's cost and expense, and
on the Mortgagor's failure to do so, authorizes the holder of the Mortgage to
obtain and maintain such insurance at such Mortgagor's cost and expense, and to
seek reimbursement therefor from the Mortgagor. Where required by state law or
regulation, the Mortgagor has been given an opportunity to choose the carrier of
the required hazard insurance, provided the policy is not a "master" or
"blanket" hazard insurance policy covering a condominium, or any hazard
insurance policy covering the common facilities of a planned unit development.
The hazard insurance policy is the valid and binding obligation of the insurer,
is in full force and effect, and will be in full force and effect and inure to
the benefit of the Purchaser upon the consummation of the transactions
contemplated by this Agreement. The Seller has not engaged in, and has no
knowledge of the Mortgagor's or any servicer's having engaged in, any act or
omission which would impair the coverage of any such policy, the benefits of the
endorsement provided for herein, or the validity and binding effect of such
policy, including, without limitation, no unlawful fee, commission, kickback or
other unlawful compensation or value of any kind has been or will be received,
retained or realized by any attorney, firm or other person or entity, and no
such unlawful items have been received, retained or realized by the Seller;
(g) Compliance with Applicable Laws. 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,
predatory, abusive and fair lending, equal credit opportunity and disclosure
laws applicable to the Mortgage Loan, including, without limitation, any
provisions relating to prepayment penalties, have been complied with, the
consummation of the transactions contemplated hereby will not involve the
violation of any such laws or regulations, and the Seller shall maintain in its
possession, available for the Purchaser's inspection, and shall deliver to the
Purchaser upon demand, evidence of compliance with all such requirements. This
representation is a Deemed Material Breach Representation;
(h) No Satisfaction of Mortgage. The Mortgage has not been satisfied,
canceled, subordinated or rescinded, in whole or in part, and the Mortgaged
Property has not been released from the lien of the Mortgage, in whole or in
part, nor has any instrument been executed that would effect any such release,
cancellation, subordination or rescission. The Seller 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
Seller waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is a
fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a low-rise condominium project, or an individual
unit in a planned unit development, provided, however, that any condominium unit
or planned unit development shall conform with the Underwriting Guidelines. In
the case of any Mortgaged Properties that are manufactured homes (a
"Manufactured Home Mortgage Loans"), (i) such Manufactured Home Mortgage Loan
conforms with the Underwriting Guidelines requirements regarding mortgage loans
related to manufactured dwellings, (ii) the related manufactured dwelling is
permanently affixed to the land, (iii) the related manufactured dwelling and the
related land are subject to a Mortgage properly filed in the appropriate public
recording office and naming Seller as mortgagee, (iv) the applicable laws of the
jurisdiction in which the related Mortgaged Property is located will deem the
manufactured dwelling located on such Mortgaged Property to be a part of the
real property on which such dwelling is located, (v) such Manufactured Home
Mortgage Loan is (x) a qualified mortgage under Section 860G(a)(3) of the
Internal Revenue Code of 1986, as amended and (y) secured by manufactured
housing treated as a single family residence under Section 25(e)(10) of the Code
(i.e., such manufactured home has a minimum of 400 square feet of living space,
a minimum width in excess of 102 inches and which is of a kind customarily used
at a fixed location) and (vi) as of the origination date of the related Mortgage
Loan, the related manufactured housing unit that secures such Mortgage Loan
either (x) was the principal residence of the Mortgagor or (y) was classified as
real property under applicable state law. As of the date of origination, no
portion of the Mortgaged Property was used for commercial purposes, and since
the date of origination, no portion of the Mortgaged Property has been used for
commercial purposes; provided, that Mortgaged Properties which contain a home
office shall not be considered as being used for commercial purposes as long as
the Mortgaged Property has not been altered for commercial purposes and is not
storing any chemicals or raw materials other than those commonly used for
homeowner repair, maintenance and/or household purposes. This representation is
a Deemed Material Breach Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and subsisting
first lien, with respect to First Lien Loans, or second lien, with respect to
Second Lien Loans, of record on a single parcel of real estate constituting the
Mortgaged Property, including all buildings and improvements on the Mortgaged
Property and all installations and mechanical, electrical, plumbing, heating and
air conditioning systems located in or annexed to such buildings, and all
additions, alterations and replacements made at any time, subject in all cases
to the exceptions to title set forth in the title insurance policy with respect
to the related Mortgage Loan, which exceptions are generally acceptable to
prudent mortgage lending companies, and such other exceptions to which similar
properties are commonly subject and which do not individually, or in the
aggregate, materially and adversely affect the benefits of the security intended
to be provided by such Mortgage. In no event shall any Mortgage Loan be in a
lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of
recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b) which
do not adversely affect the Appraised Value of the Mortgaged
Property set forth in such appraisal; and
(4) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of the
security intended to be provided by the Mortgage or the use,
enjoyment, value or marketability of the related Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Seller has full right to sell and
assign the same to Purchaser;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage and
any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms (including, without limitation, any provisions therein
relating to prepayment penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage and
any other related agreement, and the Mortgage Note, the Mortgage and any other
such related agreement have been duly and properly executed by other such
related parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material fact
or omit to state a material fact required to be stated therein or necessary to
make the information and statements therein not misleading. No fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination or servicing of the Mortgage Loan. The Seller
has reviewed all of the documents constituting the Servicing File and has made
such inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed and
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 improvement and as to disbursements of any
escrow funds therefor have been complied with. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage were paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due under the Mortgage Note or Mortgage;
(m) Ownership. The Seller is the sole owner of record and holder of the
Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon the
sale of the Mortgage Loans to the Purchaser, the Seller will retain the Mortgage
Files or any part thereof with respect thereto not delivered to the Custodian,
the Purchaser or the Purchaser's designee, in trust only for the purpose of
servicing and supervising the servicing of each Mortgage Loan. The Mortgage Loan
is not assigned or pledged, and the Seller has good, indefeasible and marketable
title thereto, and has full right to transfer and sell the Mortgage Loan to the
Purchaser free and clear of any encumbrance, equity, participation interest,
lien, pledge, charge, claim or security interest, and has full right and
authority subject to no interest or participation of, or agreement with, any
other party, to sell and assign each Mortgage Loan pursuant to this Agreement
and following the sale of each 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 Seller intends to
relinquish all rights to possess, control and monitor the Mortgage Loan. After
the Closing Date, the Seller will have no right to modify or alter the terms of
the sale of the Mortgage Loan and the Seller will have no obligation or right to
repurchase the Mortgage Loan or substitute another Mortgage Loan, except as
provided in this Agreement;
(n) Doing Business. All parties which have had any interest in the
Mortgage Loan, whether as mortgagee, assignee, pledgee or otherwise, are (or,
during the period in which they held and disposed of such interest, were) (1) in
compliance with any and all applicable licensing requirements of the laws of the
state wherein the Mortgaged Property is located, and (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state, or
(iii) a federal savings and loan association, a savings bank or a national bank
having a principal office in such state, or (3) not doing business in such
state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien Loan has
a CLTV in excess of 100%. No Mortgage Loan has an LTV greater than 100%. At
origination of the Mortgage Loan, the Mortgagor did not have a FICO score of
less than 500;
(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or
insurance; and each such title insurance policy is issued by a title insurer
that would be acceptable to a prudent lender that makes mortgage loans similar
to the Mortgage Loans and qualified to do business in the jurisdiction where the
Mortgaged Property is located, insuring the Seller, its successors and assigns,
as to the first priority lien (with respect to First Lien Loans) or second
priority lien (with respect to Second Lien Loans) of the Mortgage in the
original principal amount of the Mortgage Loan, subject only to the exceptions
contained in clauses (1) and (2) of paragraph (j) of this Subsection 9.02, and
in the case of Adjustable Rate Mortgage Loans, against any loss by reason of the
invalidity or unenforceability of the lien resulting from the provisions of the
Mortgage providing for adjustment to 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.
Additionally, such lender's title insurance policy affirmatively insures ingress
and egress, and against encroachments by or upon the Mortgaged Property or any
interest therein. The title policy does not contain any special exceptions
(other than the standard exclusions) for zoning and uses and has been marked to
delete the standard survey exception or to replace the standard survey exception
with a specific survey reading. The Seller, its successor and assigns, are the
sole insureds of such lender's title insurance policy, and such lender's title
insurance policy is valid and remains in full force and effect and will be in
force and effect upon the consummation of the transactions contemplated by this
Agreement. No claims have been made under such lender's title insurance policy,
and no prior holder of the related Mortgage, including the Seller, has done, by
act or omission, anything which would impair the coverage of such lender's title
insurance policy, including without limitation, no unlawful fee, commission,
kickback or other unlawful compensation or value of any kind has been or will be
received, retained or realized by any attorney, firm or other person or entity,
and no such unlawful items have been received, retained or realized by the
Seller. All claims covered by the title insurance policy must be made by
Purchaser and/or its assignees;
(q) No Defaults. There is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage Note and
no event which, with the passage of time or with notice and the expiration of
any grace or cure period, would constitute a default, breach, violation or event
which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note, (iii) there is no event which, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the Second Lien Loan to
receive notice of, and affords such mortgagee an opportunity to cure any default
by payment in full or otherwise under the prior mortgage;
(r) No Mechanics' Liens. 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 the law could give rise to such liens) affecting the
related Mortgaged Property which are or may be liens prior to, or equal or
coordinate with, the lien of the related Mortgage;
(s) Location of Improvements; No Encroachments. All improvements which
were considered in determining the Appraised Value of the Mortgaged Property lay
wholly within the boundaries and building restriction lines of the Mortgaged
Property, and no improvements on adjoining properties encroach upon the
Mortgaged Property. The Mortgaged Property and all improvements located on or
being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
(t) Origination; Payment Terms. 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 Act, a savings and loan association, a savings bank,
a commercial bank, credit union, insurance company or other similar institution
which is supervised and examined by a federal or state authority. The documents,
instruments and agreements submitted for loan underwriting were not falsified
and contain no untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the information and
statements therein not misleading. No Mortgage Loan contains terms or provisions
which would result in negative amortization. Unless otherwise noted on the
Mortgage Loan Schedule, principal payments on the Mortgage Loan commenced no
more than sixty (60) days after funds were disbursed in connection with the
Mortgage Loan. The Mortgage Interest Rate as well as, with respect to Adjustable
Rate Mortgage Loans, the Lifetime Rate Cap, the Periodic Rate Floor and the
Periodic Rate Cap are as set forth on Exhibit B to each related Assignment and
Conveyance Agreement. The Mortgage Interest Rate is adjusted, with respect to
Adjustable Rate Mortgage Loans, on each Interest Rate Adjustment Date to equal
the Index plus the Gross Margin (rounded up or down to the nearest 0.125%),
subject to the Periodic Rate Cap. Unless specified on the related Mortgage Loan
Schedule as an interest-only loan, the Mortgage Note is payable in equal monthly
installments of principal and interest, which installments of interest, with
respect to Adjustable Rate Mortgage Loans, are subject to change due to the
adjustments to the Mortgage Interest Rate on each Interest Rate Adjustment Date,
with interest calculated and payable in arrears, sufficient to amortize the
Mortgage Loan fully by the stated maturity date (unless the Mortgage Loan is
identified on the Mortgage Loan Schedule as a Balloon Mortgage Loan), over an
original term of not more than thirty (30) years from commencement of
amortization. Unless otherwise specified on the description of pool
characteristics for the applicable Mortgage Loan Package delivered pursuant to
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement, the Mortgage Loan is payable on the
first day of each month. There are no Convertible Mortgage Loans which contain a
provision allowing the Mortgagor to convert the Mortgage Note from an adjustable
interest rate Mortgage Note to a fixed interest rate Mortgage Note. Unless
otherwise noted on the Mortgage Loan Schedule, the Due Date of the first payment
under the Mortgage Note is no more than sixty (60) days from the date of the
Mortgage Note;
(u) Customary Provisions. The 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, (i) in the case of a Mortgage
designated as a deed of trust, by trustee's sale, and (ii) otherwise by judicial
foreclosure. Upon default by a Mortgagor on a Mortgage Loan and foreclosure on,
or trustee's sale of, the Mortgaged Property pursuant to the proper procedures,
the holder of the Mortgage Loan will be able to deliver good and merchantable
title to the Mortgaged Property. There is no homestead or other exemption
available to a Mortgagor which would interfere with the right to sell the
Mortgaged Property at a trustee's sale or the right to foreclose the Mortgage,
subject to applicable federal and state laws and judicial precedent with respect
to bankruptcy and right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The Mortgage Loan
was underwritten in accordance with the Underwriting Guidelines (a copy of which
is attached to the related Assignment and Conveyance Agreement as Exhibit C);
(w) Occupancy of the Mortgaged Property. As of the Closing Date the
Mortgaged Property is lawfully occupied under applicable law. All inspections,
licenses and certificates required to be made or issued with respect to all
occupied portions of the Mortgaged Property and, with respect to the use and
occupancy of the same, including but not limited to certificates of occupancy
and fire underwriting certificates, have been made or obtained from the
appropriate authorities. The Seller has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Seller has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. Unless otherwise noted on the Mortgage Loan Schedule, the Mortgagor
represented at the time of origination of the Mortgage Loan that the Mortgagor
would occupy the Mortgaged Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The 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 in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of trust,
a trustee, authorized and duly qualified under applicable law to serve as such,
has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. There are no circumstances or conditions with
respect to the Mortgage, the Mortgaged Property, the Mortgagor, the Mortgage
File or the Mortgagor's credit standing that can reasonably be expected to cause
private institutional investors to regard the Mortgage Loan as an unacceptable
investment, cause the Mortgage Loan to become delinquent, or adversely affect
the value or marketability of the Mortgage Loan, or cause the Mortgage Loan to
prepay during any period materially faster or slower than the mortgage loans
originated by the Seller generally. To the best of the Seller's knowledge, no
Mortgaged Property is located in a state, city, county or other local
jurisdiction which the Purchaser has determined in its sole good faith
discretion would cause the related Mortgage Loan to be ineligible for whole loan
sale or securitization in a transaction consistent with the prevailing sale and
securitization industry (including, without limitation, the practice of the
rating agencies) with respect to substantially similar mortgage loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered under
this Agreement for each Mortgage Loan have been delivered to the Custodian. The
Seller is in possession of a complete, true and accurate Mortgage File in
compliance with Exhibit A hereto, except for such documents the originals of
which have been delivered to the Custodian, and the Seller has retained copies
thereof;
(bb) Condominiums/Planned Unit Developments. If the Mortgaged Property is
a condominium unit or a planned unit development (other than a de minimis
planned unit development) such condominium or planned unit development project
is (i) acceptable to a prudent lender that makes mortgage loans similar to the
Mortgage Loans;
(cc) Transfer of Mortgage Loans. Except with respect to MERS Designated
Mortgage Loans, the Assignment of Mortgage with respect to each Mortgage Loan is
in recordable form and is acceptable for recording under the laws of the
jurisdiction in which the Mortgaged Property is located. The transfer,
assignment and conveyance of the Mortgage Notes and the Mortgages by the Seller
are not subject to the bulk transfer or similar statutory provisions in effect
in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent Interests.
The Mortgage Loan does not contain provisions pursuant to which Monthly Payments
are paid or partially paid with funds deposited in any separate account
established by the Seller, the Mortgagor, or anyone on behalf of the Mortgagor,
or paid by any source other than the Mortgagor nor does it contain any other
similar provisions which may constitute a "buydown" provision. The Mortgage Loan
is not a graduated payment mortgage loan, and the Mortgage Loan does not have a
shared appreciation or other contingent interest feature. The indebtedness
evidenced by the Mortgage Note is not convertible to an ownership interest in
the Mortgaged Property or the Mortgagor and the Seller has not financed nor does
it own directly or indirectly, any equity of any form in the Mortgaged Property
or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the applicable Cut-off Date have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured principal
amount, as consolidated, bears a single interest rate and single repayment term.
The lien of the Mortgage securing the consolidated principal amount is expressly
insured as having first or second, as applicable, lien priority by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to a prudent lender
that makes mortgage loans similar to the Mortgage Loans. The consolidated
principal amount does not exceed the original principal amount of the Mortgage
Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. There is
no proceeding pending or threatened for the total or partial condemnation of the
Mortgaged Property. The Mortgaged Property is undamaged by waste, fire,
earthquake or earth movement, windstorm, flood, tornado, hurricane or other
casualty so as to affect adversely the value of the Mortgaged Property as
security for the Mortgage Loan or the use for which the premises were intended
and each Mortgaged Property is in good repair. There have not been any
condemnation proceedings with respect to the Mortgaged Property and the Seller
has no knowledge of any such proceedings in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments. The
origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of Seller
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. Each Mortgage Loan is
covered by a paid in full, life of loan, tax service contract that has been
assigned without penalty, premium or cost to the Purchaser. All Escrow Payments
have been collected in full compliance with state and federal law and the
provisions of the related Mortgage Note and Mortgage. An escrow of funds is not
prohibited by applicable law and has been established in an amount sufficient to
pay for every item that remains unpaid and has been assessed but is not yet due
and payable. No escrow deposits or Escrow Payments or other charges or payments
due the Seller have been capitalized under the Mortgage or the Mortgage Note.
All Mortgage Interest Rate adjustments have been made in strict compliance with
state and federal law and the terms of the related Mortgage and Mortgage Note on
the related Interest Rate Adjustment Date. If, pursuant to the terms of the
Mortgage Note, another index was selected for determining the Mortgage Interest
Rate, the same index was used with respect to each Mortgage Note which required
a new index to be selected, and such selection did not conflict with the terms
of the related Mortgage Note. Any and all notices required under applicable law
and the terms of the related Mortgage Note and Mortgage regarding the Mortgage
Interest Rate and the Monthly Payment adjustments have been delivered. Any
interest required to be paid pursuant to state, federal and local law has been
properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan has the characteristics
set forth on Exhibit B to the related Assignment and Conveyance Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action, inaction
or event has occurred and no state of facts exists or has existed on or prior to
the Closing Date that has resulted or will result in the exclusion from, denial
of, or defense to coverage under any applicable hazard insurance policy or
bankruptcy bond (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),
irrespective of the cause of such failure of coverage. The Seller has caused or
will cause to be performed any and all acts required to preserve the rights and
remedies of the Purchaser in any insurance policies applicable to the Mortgage
Loans including, without limitation, any necessary notifications of insurers,
assignments of policies or interests therein, and establishments of coinsured,
joint loss payee and mortgagee rights in favor of the Purchaser. In connection
with the placement of any such insurance, no commission, fee, or other
compensation has been or will be received by the Seller or by any officer,
director, or employee of the Seller or any designee of the Seller or any
corporation in which the Seller or any officer, director, or employee had a
financial interest at the time of placement of such insurance;
(ll) No Violation of Environmental Laws. The Mortgaged Property is free
from any and all toxic or hazardous substances and there exists no violation of
any local, state or federal environmental law, rule or regulation. To the best
of Seller's knowledge, 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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not notified the
Seller, and the Seller has no knowledge of any relief requested or allowed to
the Mortgagor under the Servicemembers' Civil Relief Act of 2003, as amended, or
any similar state statute;
(nn) Appraisal. The Mortgage File contains an appraisal of the related
Mortgaged Property signed prior to the approval of the Mortgage Loan application
by an appraiser, duly licensed in the state where the Mortgage Property is
located and appointed by the related originator, 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
the Underwriting Guidelines and a prudent lender making mortgage loans similar
to the Mortgage Loan and Title XI of the Financial 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 shall have been made within one hundred eighty (180) days of the
origination of the Mortgage Loan and shall be completed in compliance with the
Uniform Standards of Professional Appraisal Practice, and all applicable Federal
and state laws and regulations. If the appraisal was made more than one hundred
twenty (120) days before the origination of the Mortgage Loan, the Seller shall
have received and delivered to the Purchaser a recertification of the appraisal
with two (2) comparable sales;
(oo) Disclosure Materials. The Mortgagor has, to the extent required by
applicable law, executed a statement to the effect that the Mortgagor has,
received all disclosure materials required by applicable law and the Seller has
complied with all applicable law with respect to the making of the Mortgage
Loans. The Seller shall cause the Interim Servicer to maintain such statement in
the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. The Mortgage
Loan was not made in connection with the construction or rehabilitation of a
Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) Qualified Mortgage. The Mortgage Loan is a qualified mortgage under
Section 860G(a)(3) of the Code;
(rr) Credit Information. As to each consumer report (as defined in the
Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Seller to the Purchaser, that Seller has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Seller shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Seller has in its capacity as servicer, for each Mortgage Loan,
fully furnished, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g., favorable and
unfavorable) on its borrower credit files to Equifax, Experian and Trans Union
Credit Information Company (three of the credit repositories), on a monthly
basis. This representation is a Deemed Material Breach Representation;
(ss) Leaseholds. No Mortgage Loan is secured by a long-term residential
lease;
(tt) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on Exhibit
B to each related Assignment and Conveyance Agreement. With respect to each
Mortgage Loan that has a prepayment penalty feature, each such prepayment
penalty is enforceable and will be enforced by the Seller for the benefit of the
Purchaser, and each prepayment penalty is permitted pursuant to federal, state
and local law. Each such prepayment penalty is in an amount equal to the maximum
amount permitted under applicable law and no such prepayment penalty may provide
for a term in excess of five (5) years with respect to Mortgage Loans originated
prior to October, 1, 2002. With respect to Mortgage Loans originated on or after
October 1, 2002, the duration of the prepayment period shall not exceed three
(3) years from the date of the Mortgage Note unless the Mortgage Loan was
modified to reduce the prepayment period to no more than three (3) years from
the date of such Mortgage Note and the Mortgagor was notified in writing of such
reduction in prepayment period. With respect to any Mortgage Loan that contains
a provision permitting imposition of a prepayment penalty upon a prepayment
prior to maturity: (i) the Mortgage Loan provides some benefit to the Mortgagor
(e.g., a rate or fee reduction) in exchange for accepting such prepayment
penalty, (ii) prior to the Mortgage Loan origination, the Mortgagor was offered
the option of obtaining a mortgage loan that did not require payment of such a
penalty and (iii) the prepayment penalty was adequately disclosed to the
Mortgagor in the loan documents pursuant to applicable state, local and federal
law. This representation is a Deemed Material Breach Representation;
(uu) Assumability. With respect to each Adjustable Rate Mortgage Loan, the
Mortgage Loan Documents provide that after the related first Interest Rate
Adjustment Date, a related Mortgage Loan may only be assumed if the party
assuming such Mortgage Loan meets certain credit requirements stated in the
Mortgage Loan Documents;
(vv) Conversion to Fixed Interest Rate. With respect to Adjustable Rate
Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(ww) Escrow Analysis. With respect to each Mortgage, the Seller has within
the last twelve (12) months (unless such Mortgage was originated within such
twelve-month period) analyzed the required Escrow Payments for each Mortgage and
adjusted the amount of such payments so that, assuming all required payments are
timely made, any deficiency will be eliminated on or before the first
anniversary of such analysis, or any overage will be refunded to the Mortgagor,
in accordance with RESPA and any other applicable law;
(xx) Predatory Lending Regulations. No Mortgage Loan is a High Cost Loan
or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion. This representation is a Deemed Material Breach
Representation;
(yy) Single-Premium Credit Life Insurance Policy. No Mortgagor was
required to purchase any single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property insurance policy) or debt
cancellation agreement as a condition of obtaining the extension of credit. No
Mortgagor obtained a prepaid single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property 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 or debt
cancellation agreements as part of the origination of, or as a condition to
closing, such Mortgage Loan. This representation is a Deemed Material Breach
Representation;
(zz) Regarding the Mortgagor. The Mortgagor is one or more natural persons
and/or trustees for an Illinois land trust or a trustee under a "living trust"
and such "living trust" is in compliance with the Underwriting Guidelines for
such trusts;
(aaa) Insurance. The Seller has caused or will cause to be performed any
and all acts required to preserve the rights and remedies of the Purchaser in
any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser;
(bbb) Simple Interest Mortgage Loans. Excepts as set forth on the Mortgage
Loan Schedule, no Mortgage Loan is a simple interest Mortgage Loan
(ccc) Flood Certification Contract. The Mortgage Loan is covered by a paid
in full, life of loan, transferable flood certification contract that has been
assigned without penalty, cost or premium to the Purchaser;
(ddd) Consent. Either (a) no consent for the Second Lien Loan is required
by the holder of the related first lien or (b) such consent has been obtained
and is contained in the Mortgage File;
(eee) Origination Date. Unless otherwise noted on the related Mortgage
Loan Schedule, the date of origination of the Mortgage Loan shall be no earlier
than three (3) months prior to the date such Mortgage Loan is first purchased by
the Purchaser;
(fff) No Exception. The Custodian has not noted any material exceptions on
an Exception Report (as defined in the Custodial Agreement) with respect to the
Mortgage Loan which would materially adversely affect the Mortgage Loan or the
Purchaser's ownership of the Mortgage Loan, unless consented to by the
Purchaser;
(ggg) Mortgage Submitted for Recordation. The Mortgage either has been or
will promptly be submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located;
(hhh) Endorsements. The Mortgage Note has been endorsed by Seller for its
own account and not as a fiduciary, trustee, trustor or beneficiary under a
trust agreement;
(iii) Accuracy of Information. All information provided to the Purchaser
by the Seller with respect to the Mortgage Loan is accurate in all material
respects;
(jjj) Mortgagor Bankruptcy. On or prior to the related Closing Date, the
Mortgagor has not filed a bankruptcy petition or has not become the subject of
involuntary bankruptcy proceedings or has not consented to the filing of a
bankruptcy proceeding against it or to a receiver being appointed in respect of
the related Mortgaged Property.
(kkk) No Construction Loans. No Mortgage Loan was made in connection with
(a) facilitating the trade-in or exchange of a Mortgaged Property or (b) the
construction or rehabilitation of a Mortgaged Property, unless the Mortgage Loan
is a construction-to-permanent mortgage loan listed on the Mortgage Loan
Schedule which has been fully disbursed, all construction work is complete and a
completion certificate has been issued;
(lll) No Equity Participation. No document relating to the Mortgage Loan
provides for any contingent or additional interest in the form of participation
in the cash flow of the Mortgaged Property or a sharing in the appreciation of
the value of the Mortgaged Property. The indebtedness evidenced by the Mortgage
Note is not convertible to an ownership interest in the Mortgaged Property or
the Mortgagor and Seller has not financed nor does it own directly or
indirectly, any equity of any form in the Mortgaged Property or the Mortgagor;
(mmm) Proceeds of Mortgage Loan. The proceeds of the Mortgage Loan have
not been and shall not be used to satisfy, in whole or in part, any debt owed or
owing by the Mortgagor to Seller or any Affiliate or correspondent thereof
unless such debt was originated more than twenty-four (24) months prior to the
origination of such Mortgage Loan;
(nnn) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction. This representation is a Deemed Material Breach Representation;
(ooo) Origination Practices/No Steering. The Mortgagor was not encouraged
or required to select a Mortgage Loan product offered by the Mortgage Loan's
originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account such facts as, without limitation, the
Mortgage Loan's requirements and the Mortgagor's credit history, income, assets
and liabilities 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 Mortgagor 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 Mortgagor's application to such affiliate for underwriting
consideration. For a Mortgagor who seeks financing through a Mortgage Loan
originator's higher-priced subprime lending channel, the Mortgagor was directed
towards or offered the Mortgage Loan originator's standard mortgage line if the
Mortgagor was able to qualify for one of the standard products. This
representation is a Deemed Material Breach Representation;
(ppp) Underwriting Methodology. The methodology used in underwriting the
extension of credit for each Mortgage Loan does not rely solely on the extent of
the Mortgagor's equity in the collateral as the principal determining factor in
approving such extension of credit. The methodology employed objective criteria
such as the Mortgagor's income, assets and liabilities, to the proposed mortgage
payment and, based on such methodology, the Mortgage Loan's originator made a
reasonable determination that at the time of origination the Mortgagor had the
ability to make timely payments on the Mortgage Loan. Such underwriting
methodology confirmed that at the time of origination (application/approval) the
Mortgagor had a reasonable ability to make timely payments on the Mortgage Loan.
This representation is a Deemed Material Breach Representation;
(qqq) Points and Fees. Points and fees charged were in compliance with
State, Federal, and regulatory and governing agencies, Seller's Underwriting
Guidelines and anti-predatory guidelines and are set forth on the Mortgage Loan
Schedule;
(rrr) Fees Charges. All fees and charges (including finance charges) and
whether or not financed, assessed, collected or to be collected in connection
with the origination and servicing of each Mortgage Loan has been disclosed in
writing to the Mortgagor in accordance with applicable state and federal law and
regulation. This representation is a Deemed Material Breach Representation;
(sss) Second Lien Mortgage Loans. With respect to each Second Lien Loan:
(1) the related First Lien Loan does not permit negative amortization; (2) where
required or customary in the jurisdiction in which the Mortgaged Property is
located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) to the best of Seller's
knowledge, the related First Lien Loan is in full force and effect, and there is
no default, lien, breach, violation or event which would permit acceleration
existing under such First Lien Loan or 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 which would
permit acceleration under such First Lien Loan; (4) the related first lien
Mortgage contains a provision which provides for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such mortgagee to
cure any default under the related First Lien Mortgage; and (5) the related
Mortgaged Property is the Mortgagor's principal residence. This representation
is a Deemed Material Breach Representation; and
(ttt) The Seller or an Affiliate thereof was the originator of each
Mortgage loan.
Subsection 9.03. Remedies for Breach of Representations and Warranties.
It is understood and agreed that the representations and warranties set
forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage Loans
to the Purchaser and shall inure to the benefit of the Purchaser,
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
Assignment of Mortgage or the examination or failure to examine any Mortgage
File. Upon discovery by either the Seller or the Purchaser of a breach of any of
the foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other.
Within sixty (60) days of the discovery, Purchaser shall send written
notice to Seller of any breach of a representation or warranty which materially
and adversely affects the value of the Mortgage Loan, or the interest of the
Purchaser's therein (or which materially and adversely affects the value of the
applicable Mortgage Loan or the interest of the Purchaser therein in the case of
a representation and warranty relating to a particular Mortgage Loan). The
Seller shall use its best efforts promptly to cure such breach in all material
respects and, if such breach cannot be cured, the Seller shall, at the
Purchaser's option, repurchase such Mortgage Loan at the Repurchase Price,
together with all expenses incurred by the Purchaser as a result of such
repurchase. Notwithstanding the above sentence, (i) within sixty (60) days of
the earlier of either discovery by, or notice to, the Seller of any breach of
the representation and warranty set forth in clause (rr) of Subsection 9.02, the
Seller shall repurchase such Mortgage Loan at the Repurchase Price, together
with all expenses incurred by the Purchaser as a result of such repurchase and
(ii) any breach of a Deemed Material Breach Representation shall automatically
be deemed to materially and adversely affect the value of the Mortgage Loan and
the interest of the Purchaser therein. In the event that a breach shall involve
any representation or warranty set forth in Subsection 9.01, and (except as
provided in the preceding sentence with respect to certain breaches for which no
cure is permitted) such breach cannot be cured within sixty (60) days of the
earlier of either discovery by or notice to the Seller of such breach, all of
the Mortgage Loans shall, at the Purchaser's option, be repurchased by the
Seller at the Repurchase Price, together with all expenses incurred by the
Purchaser as a result of such repurchase. However, if the breach shall involve a
representation or warranty set forth in Subsection 9.02 (other than the
representations and warranties set forth in clause (rr) of such Subsection or
any Deemed Material Breach Representation) and the Seller discovers or receives
notice of any such breach within one hundred twenty (120) days of the related
Closing Date, the Seller shall, at the Purchaser's option and provided that the
Seller has a Qualified Substitute Mortgage Loan, rather than repurchase the
Mortgage Loan as provided above, remove such Mortgage Loan (a "Deleted Mortgage
Loan") and substitute in its place a Qualified Substitute Mortgage Loan or
Loans, provided that any such substitution shall be effected not later than one
hundred twenty (120) days after the related Closing Date. If the Seller has no
Qualified Substitute Mortgage Loan, it shall repurchase the deficient Mortgage
Loan. Any repurchase of a Mortgage Loan or Loans pursuant to the foregoing
provisions of this Subsection 9.03 shall be accomplished by either direct
remittance of the Repurchase Price to the Purchaser or its designee in
accordance with the Purchaser's instructions.
At the time of repurchase or substitution, the Purchaser and the Seller
shall arrange for the reassignment of the Deleted Mortgage Loan to the Seller
and the delivery to the Seller of any documents held by the Custodian relating
to the Deleted Mortgage Loan. In the event of a repurchase or substitution, the
Seller shall, simultaneously with such reassignment, give written notice to the
Purchaser that such repurchase or substitution has taken place, amend the
Mortgage Loan Schedule to reflect the withdrawal of the Deleted Mortgage Loan
from this Agreement, and, in the case of substitution, identify a Qualified
Substitute Mortgage Loan and amend the Mortgage Loan Schedule to reflect the
addition of such Qualified Substitute Mortgage Loan to this Agreement. In
connection with any such substitution, the Seller shall be deemed to have made
as to such Qualified Substitute Mortgage Loan the representations and warranties
set forth in this Agreement except that all such representations and warranties
set forth in this Agreement shall be deemed made as of the date of such
substitution. The Seller shall effect such substitution by delivering to the
Custodian or to such other party as the Purchaser may designate in writing for
such Qualified Substitute Mortgage Loan the documents required by Subsection
6.03, with the Mortgage Note endorsed as required by Subsection 6.03. No
substitution will be made in any calendar month after the Determination Date for
such month. The Seller shall cause the Interim Servicer to remit directly to the
Purchaser, or its designee in accordance with the Purchaser's instructions the
Monthly Payment less the Servicing Fee due, if any, on such Qualified Substitute
Mortgage Loan or Loans in the month following the date of such substitution.
Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the
month of substitution shall be retained by the Seller. For the month of
substitution, distributions to the Purchaser shall include the Monthly Payment
due on any Deleted Mortgage Loan in the month of substitution, and the Seller
shall thereafter be entitled to retain all amounts subsequently received by the
Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the Seller
shall indemnify the Purchaser and its present and former directors, officers,
employees and agents and any Successor Servicer and its present and former
directors, officers, employees and agents and hold such parties harmless against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses and
related costs, judgments, and other costs and expenses resulting from any claim,
demand, defense or assertion based on or grounded upon, or resulting from, a
breach of any representation or warranty contained in this Agreement or any
Reconstitution Agreement. It is understood and agreed that the obligations of
the Seller set forth in this Subsection 9.03 to cure, substitute for or
repurchase a defective Mortgage Loan and to indemnify the Purchaser and
Successor Servicer as provided in this Subsection 9.03 and Subsection 14.01
constitute the sole remedies of the Purchaser and Successor Servicer respecting
a breach of the foregoing representations and warranties. For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
Any cause of action against the Seller relating to or arising out of the
breach of any representations and warranties made in Subsections 9.01 and 9.02
shall accrue as to any Mortgage Loan upon (i) discovery of such breach by the
Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by the
Seller to cure such breach or repurchase such Mortgage Loan as specified above,
and (iii) demand upon the Seller by the Purchaser for compliance with this
Agreement.
Subsection 9.04. Repurchase of Mortgage Loans That Prepay in Full.
If any Mortgage Loan is prepaid within ninety (90) days from and after the
related Closing Date, the Purchaser shall notify Seller in writing within sixty
(60) days of the date Purchaser receives notice of such prepayment. Seller shall
pay to the Purchaser, within thirty (30) days after written notice received by
Seller from Purchaser, an amount equal to the Premium Percentage multiplied by
the outstanding principal balance of such Mortgage Loan as of the date of such
prepayment in full.
Subsection 9.05. Repurchase of Mortgage Loans with First Payment
Defaults.
(a) If the related Mortgage Loan becomes a Delinquent Mortgage Loan with
respect to the Mortgage Loan's first Monthly Payment due to the Purchaser after
the related Cut-off Date of such Mortgage Loan the Seller, at the Purchaser's
option exercised in its sole discretion, shall repurchase such Delinquent
Mortgage Loan from the Purchaser at a price equal to the percentage of par as
stated in the related Purchase Price and Terms Agreement (subject to adjustment
as provided therein) multiplied by the then outstanding principal balance of
such Mortgage Loan, plus accrued and unpaid interest thereon from the date to
which interest was last paid through the day prior to the repurchase date at the
applicable Mortgage Interest Rate, plus any outstanding advances owed to any
servicer in connection with such Mortgage Loan; provided, however, in the event
the Seller is not servicing the Mortgage Loan at such time as the Mortgage Loan
became a Delinquent Mortgage Loan, the Purchaser shall notify Seller in writing
within sixty (60) days after the Purchaser receives notice of such early payment
default.
Subsection 9.06. Purchaser's Right to Review.
Prior to the related Closing Date, the Purchaser shall have the right to
review each Mortgage File and Credit File, to conduct property inspections,
obtain appraisal recertifications, drive-by appraisals, brokers price opinions
and otherwise to underwrite the Mortgage Loans and to reject any Mortgage Loan
which in the Purchaser's sole opinion is an unacceptable investment. Any
rejected Mortgage Loan shall be removed from the terms of this Agreement.
All rights of the Purchaser under this Subsection 9.06 shall terminate
upon the transfer of any Mortgage Loan to any other Purchaser.
Notwithstanding the foregoing, the fact that the Purchaser or its designee
has conducted or failed to conduct the review/due diligence procedures specified
above or any other partial or complete examination of the Mortgage Files or
Credit Files shall not impair in any way the Purchaser's or any of its
successors' rights to demand repurchase, substitution or any other remedy
provided under this Agreement.
SECTION 10. Closing.
The closing for the purchase and sale of each Mortgage Loan Package shall
take place on the related Closing Date. At the Purchaser's option, the Closing
shall be either: by telephone, confirmed by letter or wire as the parties shall
agree, or conducted in person, at such place as the parties shall agree.
The closing for the Mortgage Loans to be purchased on each Closing Date
shall be subject to each of the following conditions:
(a) at least two (2) Business Days prior to the related Closing Date,
the Seller shall deliver to the Purchaser, in electronic format
acceptable to the Purchaser in its sole discretion, a listing on a
loan-level basis of the necessary information to compute the
Purchase Price of the Mortgage Loans delivered on the Closing Date
(including accrued interest), and prepare a Mortgage Loan Schedule;
(b) all of the representations and warranties of the Seller under this
Agreement and of the Interim Servicer under this Agreement (with
respect to each Mortgage Loan for an interim period, as specified
therein) shall be true and correct as of the related Closing Date
and no event shall have occurred which, with notice or the passage
of time, would constitute a default under this Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys
shall have received in escrow, all closing documents as specified in
Section 11 of this Agreement, 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 Seller shall have delivered and released to the Custodian all
documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the Seller
on the related Closing Date the Purchase Price, plus accrued interest pursuant
to Section 4 of this Agreement, by wire transfer of immediately available funds
to the account designated by the Seller.
SECTION 11. Closing Documents.
The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date shall consist of fully executed originals of the following
documents:
1. this Agreement (to be executed and delivered only for the initial
Closing Date);
2. with respect to the initial Closing Date, the Custodial Agreement,
dated as of the initial Cut-off Date;
3. the related Mortgage Loan Schedule, segregated by Mortgage Loan
Package, one copy to be attached hereto, one copy to be attached to
the Custodian's counterpart of the Custodial Agreement, and one copy
to be attached to the related Assignment and Conveyance as the
Mortgage Loan Schedule thereto;
4. a Custodian's Certification, as required under the Custodial
Agreement, in the form of Exhibit G-1 to the Custodial Agreement;
5. with respect to the initial Closing Date, an Officer's Certificate,
in the form of Exhibit C hereto with respect to each of the Seller
and the Interim Servicer, including all attachments hereto; with
respect to subsequent Closing Dates, an Officer's Certificate upon
request of the Purchaser;
6. with respect to the initial Closing Date, an Opinion of Counsel of
each of the Seller and the Interim Servicer (who may be an employee
of the Seller or the Interim Servicer, as applicable), in the form
of Exhibit D hereto ("Opinion of Counsel of the Seller"); with
respect to subsequent Closing Dates, an Opinion of Counsel of the
Seller upon request of the Purchaser;
7. with respect to the initial Closing Date, an Opinion of Counsel of
the Custodian (who may be an employee of the Custodian), in the form
of an Exhibit to the Custodial Agreement;
8. with respect to the initial Closing Date, the Underwriting
Guidelines to be attached to the related Assignment and Conveyance
as Exhibit C;
9. Assignment and Conveyance Agreement in the form of Exhibit H hereto;
10. Exhibit B to the related Assignment and Conveyance Agreement; and
11. a MERS Report reflecting the Purchaser as Investor and no Person as
Interim Funder for each MERS Designated Mortgage Loan.
The Seller shall bear the risk of loss of the closing documents until such
time as they are received by the Purchaser or its attorneys.
SECTION 12. Costs.
The Purchaser shall pay any commissions due its salesmen and the legal
fees and expenses of its attorneys and custodial fees. All other costs and
expenses incurred in connection with the transfer and delivery of the Mortgage
Loans and the Servicing Rights including recording fees, fees for title policy
endorsements and continuations, fees for recording Assignments of Mortgage, and
the Seller's attorney's fees, shall be paid by the Seller.
SECTION 13. Cooperation of Seller With a Reconstitution.
The Seller and the Purchaser agree that with respect to some or all of the
Mortgage Loans, after each Closing Date, on one or more dates (each, a
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may effect
a Reconstitution of some or all of the Mortgage Loans then subject to this
Agreement, without recourse, to:
(a) no more than three (3) third party purchasers in no more than three
(3) Whole Loan Transfers; or
(b) one or more trusts or other entities to be formed as part of one or
more Securitization Transactions.
The Seller agrees to execute in connection with any and all reasonably
acceptable pool purchase contracts, and/or agreements among the Purchaser, the
Seller, any servicer in connection with a Whole Loan Transfer, a seller's
warranties and servicing agreement or a participation and servicing agreement in
form and substance reasonably acceptable to the parties, and in connection with
a Securitization Transaction, a pooling and servicing agreement in form and
substance reasonably acceptable to the parties or an Assignment and Recognition
Agreement substantially in the form attached hereto as Exhibit J (collectively,
the agreements referred to herein are designated, the "Reconstitution
Agreements").
With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller 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 related
Reconstitution Date or make the representations and warranties set forth in the
related selling/servicing guide of the servicer or issuer, as the case may be,
or such representations or warranties as may be required by any Rating Agency or
prospective purchaser of the related securities or such Mortgage Loans, in
connection with such Reconstitution. The Seller shall provide to such servicer
or issuer, as the case may be, and any other participants or purchasers in such
Reconstitution: (i) any and all information and appropriate verification of
information which may be reasonably available to the Seller or its affiliates,
whether through letters of its auditors and counsel or otherwise, as the
Purchaser or any such other participant shall request; and (ii) such additional
representations, warranties, covenants, opinions of counsel, letters from
auditors, and certificates of public officials or officers of the Seller or the
Interim Servicer as are reasonably believed necessary by the Purchaser or any
such other participant; and (iii) to execute, deliver and satisfy all conditions
set forth in any indemnity agreement required by the Purchaser or any such
participant, including, without limitation, an Indemnification and Contribution
Agreement in substantially the form attached hereto as Exhibit K. Moreover, the
Seller agrees to cooperate with all reasonable requests made by the Purchaser to
effect such Reconstitution Agreements. The Seller shall indemnify the Purchaser,
each affiliate of the Purchaser participating in the Reconstitution and each
Person who controls the Purchaser or such affiliate and their respective present
and former directors, officers, employees and agents, and 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 each of them may sustain in any way related to any information
provided by or on behalf of the Seller regarding the Seller, the Seller's
servicing practices or performance, the Mortgage Loans or the Underwriting
Guidelines set forth in any offering document prepared in connection with any
Reconstitution. For purposes of the previous sentence, "Purchaser" shall mean
the Person then acting as the Purchaser under this Agreement and any and all
Persons who previously were "Purchasers" under this Agreement.
In the event the Purchaser has elected to have the Interim Servicer or the
Seller hold record title to the Mortgages, prior to the Reconstitution Date, the
Interim Servicer or the Seller shall prepare an assignment of mortgage in blank
or to the prospective purchaser or trustee, as applicable, from the Interim
Servicer or the Seller, as applicable, acceptable to the prospective purchaser
or trustee, as applicable, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), track such Assignments of
Mortgage to ensure they have been recorded and deliver them as required by the
prospective purchaser or trustee, as applicable, upon the Interim Servicer's
receipt thereof. Additionally, the Interim Servicer shall prepare and execute or
shall cause the Seller to execute, at the direction of the Purchaser, any note
endorsement in connection with any and all seller/servicer agreements.
All Mortgage Loans not sold or transferred pursuant to a Reconstitution
shall remain subject to this Agreement.
SECTION 14. The Seller.
Subsection 14.01. Additional Indemnification by the Seller; Third Party
Claims.
(a) The Seller shall indemnify the Purchaser and its present and former
directors, officers, employees and agents and any Successor Servicer and its
present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees (including legal fees incurred in connection with the
enforcement of the Seller's indemnification obligation under this Section 14.01)
and related costs, judgments, and any other reasonable costs, fees and expenses
that such parties may sustain in any way related to the failure of the Seller to
perform its duties and the Interim Servicer to service the Mortgage Loans in
strict compliance with the terms of this Agreement or any Reconstitution
Agreement entered into pursuant to Section 13 or any breach of any of Seller's
representations, warranties and covenants set forth in this Agreement (provided
that such costs shall not include any lost profits). For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
(b) Promptly after receipt by an indemnified party under this Section
14.01 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 14.01, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
the indemnifying party from any liability which it may have to any indemnified
party under this Section 14.01, except to the extent that it has been prejudiced
in any material respect, or from any liability which it may have, otherwise than
under this Section 14.01. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
or parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election so to assume the
defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party for expenses
incurred by the indemnified party in connection with the defense thereof unless
(i) the indemnified party shall have employed separate counsel in connection
with the assertion of legal defenses in accordance with the proviso to the next
preceding sentence (it being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one separate counsel (together
with one local counsel, if applicable)), (ii) the indemnifying party shall not
have employed counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
Subsection 14.02. Merger or Consolidation of the Seller.
The Seller 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.
SECTION 15. Financial Statements.
Intentionally Omitted.
SECTION 16. Mandatory Delivery; Grant of Security Interest.
Intentionally Omitted.
SECTION 17. Notices.
All demands, notices and communications hereunder shall be in writing and
shall be given via email, facsimile transmission or registered or certified mail
to the person at the address set forth below:
(i) if to the Seller:
The CIT Group/Consumer Finance, Inc.
0 XXX Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxx
(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: 000-000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: 000-000-0000
Email: xxxxxx.xxxxx@xxxxxx.xxx
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 18. Severability Clause.
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 19. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.
SECTION 20. Governing Law Jurisdiction; Consent to Service of Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED COUNTERPART
THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND SHALL BE
DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT SHALL BE
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
ITS CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER
IRREVOCABLY (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH
COURT; (III) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY
SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW; AND (IV) CONSENTS
TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL
ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER.
SECTION 21. Intention of the Parties.
It is the intention of the parties that the Purchaser is purchasing, and
the Seller is selling the Mortgage Loans and not a debt instrument of the Seller
or another security. Accordingly, the parties hereto each intend to treat the
transaction for Federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. Moreover, the arrangement
under which the Mortgage Loans are held shall be consistent with classification
of such arrangement as a grantor trust in the event it is not found to represent
direct ownership of the Mortgage Loans. The Purchaser shall have the right to
review the Mortgage Loans and the related Mortgage Loan Files to determine the
characteristics of the Mortgage Loans which shall affect the Federal income tax
consequences of owning the Mortgage Loans and the Seller shall cooperate with
all reasonable requests made by the Purchaser in the course of such review.
SECTION 22. Successors and Assigns; Assignment of Purchase Agreement.
This Agreement shall bind and inure to the benefit of and be enforceable
by the Seller and the Purchaser and the respective permitted successors and
assigns of the Seller and the successors and assigns of the Purchaser. This
Agreement shall not be assigned, pledged or hypothecated by the Seller to a
third party without the prior written consent of the Purchaser, which consent
may be withheld by the Purchaser in its sole discretion. This Agreement may be
assigned, pledged or hypothecated by the Purchaser in whole or in part, and with
respect to one or more of the Mortgage Loans, (i) in the case of a
Securitization Transaction, without the prior consent of the Seller and (ii) in
the case of a Whole Loan Transfer, with the prior consent of the Seller,
provided that such consent shall not be unreasonably withheld.
SECTION 23. Waivers.
No term or provision of this Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced.
SECTION 24. Exhibits.
The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.
SECTION 25. General Interpretive Principles.
For purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires:
(a) the terms defined in this Agreement have the meanings assigned to them
in this Agreement and include the plural as well as the singular, and the use of
any gender herein shall be deemed to include the other gender;
(b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) references herein to "Articles," "Sections," "Subsections,"
"Paragraphs," and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other subdivisions of
this Agreement;
(d) reference to a Subsection without further reference to a Section is a
reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(e) the words "herein," "hereof," "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular provision;
and
(f) the term "include" or "including" shall mean without limitation by
reason of enumeration.
SECTION 26. Reproduction of Documents.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by any party at the closing, and (c) financial
statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 27. Further Agreements.
The Seller and the Purchaser each agree to execute and deliver to the
other such reasonable and appropriate additional documents, instruments or
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.
SECTION 28. RECORDATION OF ASSIGNMENTS OF MORTGAGE.
To the extent permitted by applicable law, for Mortgage Loans which are
not registered with MERS, each of the Assignments of Mortgage is subject to
recordation in all appropriate public offices for real property records in all
the counties or their 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 at the Seller's expense in
the event recordation is either necessary under applicable law or requested by
the Purchaser at its sole option (other than with respect to the MERS Designated
Mortgage Loans).
SECTION 29. No Solicitation.
From and after the Closing Date, the Seller agrees that it will not take
any action or permit or cause any action to be taken by any of its agents or
affiliates, or by any independent contractors on the Seller's behalf, to
personally, by telephone or mail (via electronic means or otherwise), solicit
the borrower or obligor under any Mortgage Loan for any purpose whatsoever,
including to refinance a Mortgage Loan, in whole or in part, without the prior
written consent of the Purchaser. It is understood and agreed that all rights
and benefits relating to the solicitation of any Mortgagors and the attendant
rights, title and interest in and to the list of such Mortgagors and data
relating to their Mortgages (including insurance renewal dates) shall be
transferred to the Purchaser pursuant hereto on the Closing Date and the Seller
shall take no action to undermine these rights and benefits. Notwithstanding the
foregoing, it is understood and agreed that promotions undertaken by the Seller
or any affiliate of the Seller which are directed to the general public at
large, including, without limitation, mass mailing based on commercially
acquired mailing lists, newspaper, radio and television advertisements shall not
constitute solicitation under this Section 29.
SECTION 30. Waiver of Trial by Jury.
THE SELLER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS AGREEMENT.
SECTION 31. Compliance With Regulation Ab
Subsection 31.01. Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose of
Section 31 of this Agreement is to facilitate compliance by the Purchaser and
any Depositor with the provisions of Regulation AB and related rules and
regulations of the Commission. Although Regulation AB is applicable by its terms
only to offerings of asset-backed securities that are registered under the
Securities Act, the Seller acknowledges that investors in privately offered
securities may require that the Purchaser or any Depositor provide comparable
disclosure in unregistered offerings. References in this Agreement to compliance
with Regulation AB include provision of comparable disclosure, to the extent
such disclosure is reasonably available to the Seller, in private offerings.
Neither the Purchaser nor any Depositor shall exercise its right to
request delivery of information or other performance under these provisions
other than in good faith, or for purposes other than compliance with the
Securities Act, the Exchange Act and the rules and regulations of the Commission
thereunder (or the provision in a private offering of disclosure comparable to
that required under the Securities Act). The Seller acknowledges that
interpretations of the requirements of Regulation AB may change over time,
whether due to interpretive guidance provided by the Commission or its staff,
consensus among participants in the asset-backed securities markets, advice of
counsel, or otherwise, and agrees to comply with requests made by the Purchaser
or any Depositor in good faith for delivery of information under these
provisions on the basis of evolving interpretations of Regulation AB. In
connection with any Securitization Transaction, the Seller 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 Seller, any Third-Party Originator and the Mortgage
Loans, or the servicing of the Mortgage Loans, reasonably believed by the
Purchaser or any Depositor to be necessary in order to effect such compliance.
The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller by providing timely notice of requests for information
under these provisions and by reasonably limiting such requests to information
required, in the Purchaser's reasonable judgment, to comply with Regulation AB.
Subsection 31.02. Additional Representations and Warranties of the
Seller.
(a) The Seller shall be deemed to represent to the Purchaser and to any
Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Subsection 31.03 that, except as disclosed in
writing to the Purchaser or such Depositor prior to such date: (i) there are no
material legal or governmental proceedings pending (or known to be contemplated)
against the Seller, (ii) there are no affiliations, relationships or
transactions relating to the Seller, with respect to any Securitization
Transaction and any party thereto identified by the related Depositor of a type
described in Item 1119 of Regulation AB.
(b) If so requested by the Purchaser or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Subsection 31.03, the Seller shall, within ten (10) Business
Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section or, if
any such representation and warranty is not accurate as of the date of such
request, provide reasonably adequate disclosure of the pertinent facts, in
writing, to the requesting party.
Subsection 31.03. Information to Be Provided by the Seller.
In connection with any Securitization Transaction for which 20% or more of
the pool assets are originated by Seller or an affiliate thereof, the Seller
shall (i) within ten (10) Business Days following request by the Purchaser or an
Affiliate thereof or any Depositor, provide to the Purchaser and such Depositor
(or, as applicable, cause each Third-Party Originator to provide), in writing
and in form and substance reasonably satisfactory to the Purchaser and such
Depositor, the information and materials specified in paragraphs (a) and (b) of
this Section, and (ii) as promptly as practicable following notice to or
discovery by the Seller, provide to the Purchaser and any Depositor (in writing
and in form and substance reasonably satisfactory to the Purchaser and such
Depositor) the information specified in paragraph (d) of this Section.
(a) If so requested by the Purchaser or any Depositor, the Seller shall
provide such information regarding (i) the Seller, as originator of the Mortgage
Loans as is requested for the purpose of compliance with Items 1103(a)(1), 1105,
1110, 1117 and 1119 of Regulation AB. Such information shall be in substantially
the same form as the exhibit attached hereto as Exhibit B and include, at a
minimum:
(A) the originator's form of organization;
(B) a description of the originator's origination program and how
long the originator has been engaged in originating residential mortgage
loans, which description shall include a discussion of the originator's
experience in originating mortgage loans of a similar type as the Mortgage
Loans; information regarding the size and composition of the originator's
origination portfolio; and information that may be material, in the good
faith judgment of the Purchaser or any Depositor, to an analysis of the
performance of the Mortgage Loans, including the originators' credit-granting
or underwriting criteria for mortgage loans of similar type(s) as the
Mortgage Loans and such other information as the Purchaser or any Depositor
may reasonably request for the purpose of compliance with Item 1110(b)(2) of
Regulation AB;
(C) a description of any material legal or governmental proceedings
pending (or known to be contemplated) against the Seller; and
(D) a description of any affiliation or relationship between the
Seller, each Third-Party Originator and any of the following parties to a
Securitization Transaction, as such parties are identified to the Seller by
the Purchaser or any Depositor in writing in advance of such Securitization
Transaction:
(1) the sponsor;
(2) the depositor;
(3) the issuing entity;
(4) any servicer;
(5) any trustee;
(6) any originator;
(7) any significant obligor;
(8) any enhancement or support provider; and
(9) any other material transaction party.
(b) If so requested in writing by the Purchaser or any Depositor, the
Seller shall provide in connection with any Securitization Transition for which
20% or more of the pool assets are originated by Sellers, Static Pool
Information with respect to the mortgage loans (of a similar type as the
Mortgage Loans, as reasonably identified by the Purchaser as provided below)
originated by (i) the Seller, if the Seller is an originator of Mortgage Loans.
Such Static Pool Information shall be prepared by the Seller on the basis of its
reasonable, good faith interpretation of the requirements of Item 1105(a)(1)-(3)
of Regulation AB. To the extent that there is reasonably available to the Seller
Static Pool Information with respect to more than one mortgage loan type, the
Purchaser or any Depositor shall be entitled to specify whether some or all of
such information shall be provided pursuant to this paragraph. The content of
such Static Pool Information may be in the form customarily provided by the
Seller, and need not be customized for the Purchaser or any Depositor. Such
Static Pool Information for each vintage origination year or prior securitized
pool, as applicable, shall be presented in increments no less frequently than
quarterly over the life of the mortgage loans included in the vintage
origination year or prior securitized pool. The most recent periodic increment
must be as of a date no later than one hundred thirty-five (135) days prior to
the date of the prospectus or other offering document in which the Static Pool
Information is to be included or incorporated by reference. The Static Pool
Information shall be provided in an electronic format that provides a permanent
record of the information provided, such as a portable document format (pdf)
file, or other such electronic format reasonably required by the Purchaser or
the Depositor, as applicable.
Promptly following notice or discovery of a material error in Static Pool
Information provided pursuant to the immediately preceding paragraph (including
an omission to include therein information required to be provided pursuant to
such paragraph), the Seller shall provide corrected Static Pool Information to
the Purchaser or any Depositor, as applicable, in the same format in which
Static Pool Information was previously provided to such party by the Seller.
If so requested by the Purchaser or any Depositor, the Seller shall
provide (or, as applicable, cause each Third-Party Originator to provide), at
the expense of the requesting party (to the extent of any additional incremental
expense associated with delivery pursuant to this Agreement), such agreed-upon
procedures letters of certified public accountants reasonably acceptable to the
Purchaser or Depositor, as applicable, pertaining to Static Pool Information
relating to prior securitized pools for securitizations closed on or after
January 1, 2006 or, in the case of Static Pool Information with respect to the
Seller's or Third-Party Originator's originations or purchases, to calendar
months commencing January 1, 2006, as the Purchaser or such Depositor shall
reasonably request. Such letters shall be addressed to and be for the benefit of
such parties as the Purchaser or such Depositor shall designate, which may
include, by way of example, any Sponsor, any Depositor and any broker dealer
acting as underwriter, placement agent or initial purchaser with respect to a
Securitization Transaction. Any such statement or letter may take the form of a
standard, generally applicable document accompanied by a reliance letter
authorizing reliance by the addressees designated by the Purchaser or such
Depositor.
(c) [Reserved].
(d) If so requested in writing 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 Seller shall (i) notify the
Purchaser and any Depositor in writing of (A) any material litigation or
governmental proceedings pending against the Seller and (B) any affiliations or
relationships that develop following the closing date of a Securitization
Transaction between the Seller and any of the parties specified in clause (D) of
paragraph (a) of this Section (and any other parties identified in writing by
the requesting party) with respect to such Securitization Transaction, and (ii)
provide to the Purchaser and any Depositor a description of such proceedings,
affiliations or relationships.
(e) The Purchaser shall cause the Servicer (or another party) to be
obligated to provide to the Seller, information, in the form customarily
provided by such servicer or other party (which need not be customized for the
Seller), with respect to the Mortgage Loans reasonably necessary for the Seller
to prepare static pool information as described in Item 1105(a)(2) and (3) of
Regulation AB (such information provided by the servicer or such other party,
the "Loan Performance Information").
In addition, the Purchaser shall cause the related servicer (or such other
party) to be obligated to provide to the Seller, promptly following notice or
discovery of a material error in Loan Performance Information provided pursuant
to the immediately preceding paragraph (including an omission to include therein
information required to be provided pursuant to such paragraph), corrected Loan
Performance Information in the same format in which Loan Performance Information
was previously provided to the Sellers by such servicer (or such other party).
Subsection 31.04. Indemnification; Remedies.
(a) The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser, the Depositor, and each of the following parties participating in a
Securitization Transaction: each sponsor and issuing entity; each Person
responsible for the preparation, execution or filing of any report required to
be filed with the Commission with respect to such Securitization Transaction, or
for execution of a certification pursuant to Rule 13a-14(d) or Rule 15d-14(d)
under the Exchange Act with respect to such Securitization Transaction; each
broker dealer acting as underwriter, placement agent or initial purchaser, each
Person who controls any of such parties or the Depositor (within the meaning of
Section 15 of the Securities Act and Section 20 of the Exchange Act); and the
respective present and former directors, officers, employees and agents of each
of the foregoing and of the Depositor, and shall hold each of them harmless from
and against any losses, damages, penalties, fines, forfeitures, legal fees and
expenses and related costs, judgments, and any other costs, fees and expenses
that any of them may sustain arising out of or based upon:
(i) (A) any untrue statement of a material fact contained or alleged to be
contained in any information, report, certification, accountants' letter or
other material provided in written or electronic form under this Section 31
by or on behalf of the Seller, or provided under this Section 31
(collectively, the "Seller Information"), or (B) the omission or alleged
omission to state in the Seller Information a material fact required to be
stated in the Seller Information or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, by way of clarification, that clause (B) of this
paragraph shall be construed solely by reference to the Seller Information
and not to any other information communicated in connection with a sale or
purchase of securities, without regard to whether the Seller Information or
any portion thereof is presented together with or separately from such other
information;
(ii) any failure by the Seller to deliver any information, report,
certification, accountants' letter or other material when and as required
under this Section 31; or
(iii) any breach by the Seller of a representation or warranty set forth
in Subsection 31.02(a) or in a writing furnished pursuant to Subsection
31.02(b) and made as of a date prior to the closing date of the related
Securitization Transaction, to the extent that such breach is not cured by
such closing date, or any breach by the Seller of a representation or
warranty in a writing furnished pursuant to Subsection 31.02(b) to the extent
made as of a date subsequent to such closing date.
In the case of any failure of performance described in clause (a)(ii) of
this Section, the Seller shall promptly reimburse the Purchaser, any Depositor,
as applicable, and each Person responsible for the preparation, execution or
filing of any report required to be filed with the Commission with respect to
such Securitization Transaction, or for execution of a certification pursuant to
Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction, for all costs reasonably incurred by each such party
in order to obtain the information, report, certification, accountants' letter
or other material not delivered as required by the Seller.
(b) (i) Any failure by the Seller to deliver any information, report,
certification, accountants' letter or other material when and as required under
this Section 31, or any breach by the Seller of a representation or warranty set
forth in Subsection 31.02(a) or in a writing furnished pursuant to Subsection
31.02(b) and made as of a date prior to the closing date of the related
Securitization Transaction, to the extent that such breach is not cured by such
closing date, or any breach by the Seller of a representation or warranty in a
writing furnished pursuant to Subsection 31.02(b) to the extent made as of a
date subsequent to such closing date, shall immediately and automatically,
without notice or grace period, constitute an Event of Default with respect to
the Seller under this Agreement and any applicable Reconstitution Agreement, and
shall entitle the Purchaser or Depositor, as applicable, in its sole discretion
to terminate the rights and obligations of the Interim Servicer as servicer
under this Agreement and/or any applicable Reconstitution Agreement without
payment (notwithstanding anything in this Agreement or any applicable
Reconstitution Agreement to the contrary) of any compensation to the Interim
Servicer; provided that to the extent that any provision of this Agreement
and/or any applicable Reconstitution Agreement expressly provides for the
survival of certain rights or obligations following termination of the Interim
Servicer as servicer, such provision shall be given effect.
(c) The Purchaser shall indemnify Seller and each affiliate of Seller 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 sustain
arising out of or based upon:
(i) (A) any untrue statement of a material fact contained in the Loan
Performance Information or (B) the omission to state in the Loan
Performance Information a material fact required to be stated in the Loan
Performance 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 Loan Performance
Information and not to any other information communicated in connection
with a sale or purchase of securities, without regard to whether the Loan
Performance Information or any portion thereof is presented together with
or separately from such other information;
(ii) any material failure by the Purchaser or by the related servicer
(or other such party) to deliver any Loan Performance Information as
required under this Agreement. In the case of any material failure of
performance described in this Section, the Purchaser shall promptly
reimburse the Sellers for all costs reasonably incurred by the Seller in
order to obtain the Loan Performance Information.
[Signatures Commence on Following Page]
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their names
to be signed hereto by their respective officers thereunto duly authorized as of
the date first above written.
IXIS REAL ESTATE CAPITAL INC.
(Purchaser)
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
The CIT Group/Consumer Finance, Inc.
(Seller)
By:
------------------------------------
Name:
Title:
The CIT Group/Consumer Finance, Inc.,
(NY)(Seller)
By:
------------------------------------
Name:
Title:
The CIT Group/Consumer Finance, Inc.,
(TN)(Seller)
By:
------------------------------------
Name:
Title:
EXHIBIT A
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include each
of the following items, which shall be available for inspection by the Purchaser
and any prospective Purchaser, and which shall be delivered to the Custodian, or
to such other Person as the Purchaser shall designate in writing, pursuant to
Section 6 of the Mortgage Loan Purchase and Interim Servicing Agreement to which
this Exhibit is attached (the "Agreement"):
(a) the original Mortgage Note bearing all intervening endorsements
evidencing a complete chain of assignment from the originator to the Seller,
endorsed "Pay to the order of _________, without recourse" and signed in the
name of the Seller by an authorized officer. To the extent that there is no room
on the face of the Mortgage Notes for endorsements, the endorsement may be
contained on an allonge, if state law so allows and the Custodian is so advised
by the Seller that state law so allows. If the Mortgage Loan was acquired by the
Seller in a merger, the endorsement must be by "[Seller], successor by merger to
[name of predecessor]." If the Mortgage Loan was acquired or originated by the
Seller while doing business under another name, the endorsement must be by
"[Seller], formerly known as [previous name]";
(b) the original of any guarantee executed in connection with the Mortgage
Note;
(c) the original Mortgage with evidence of recording thereon. If in
connection with any Mortgage Loan, the Seller cannot deliver or cause to be
delivered the original Mortgage with evidence of recording thereon on or prior
to the Closing Date because of a delay caused by the public recording office
where such Mortgage has been delivered for recordation or because such Mortgage
has been lost or because such public recording office retains the original
recorded Mortgage, the Seller shall deliver or cause to be delivered to the
Custodian, a photocopy of such Mortgage, together with (i) in the case of a
delay caused by the public recording office, an Officer's Certificate of the
Seller stating that such Mortgage has been dispatched to the appropriate public
recording office for recordation and that the original recorded Mortgage or a
copy of such Mortgage certified by such public recording office to be a true and
complete copy of the original recorded Mortgage will be promptly delivered to
the Custodian upon receipt thereof by the Seller; or (ii) in the case of a
Mortgage where a public recording office retains the original recorded Mortgage
or in the case where a Mortgage is lost after recordation in a public recording
office, a copy of such Mortgage certified by such public recording office to be
a true and complete copy of the original recorded Mortgage;
(d) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;
(e) except with respect to each MERS Designated Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording. The Assignment of Mortgage must be duly recorded only
if recordation is either necessary under applicable law or commonly required by
private institutional mortgage investors in the area where the Mortgaged
Property is located or on direction of the Purchaser as provided in this
Agreement. If the Assignment of Mortgage is to be recorded, the Mortgage shall
be assigned to the Purchaser. If the Assignment of Mortgage is not to be
recorded, the Assignment of Mortgage shall be delivered in blank. If the
Mortgage Loan was acquired by the Seller in a merger, the Assignment of Mortgage
must be made by "[Seller], successor by merger to [name of predecessor]". If the
Mortgage Loan was acquired or originated by the Seller while doing business
under another name, the Assignment of Mortgage must be by "[Seller], formerly
known as [previous name]";
(f) the originals of all intervening assignments of mortgage, evidencing a
complete chain of assignment from the originator to the Seller (or MERS with
respect to each MERS Designated Mortgage Loan), with evidence of recording
thereon, or if any such intervening assignment has not been returned from the
applicable recording office or has been lost or if such public recording office
retains the original recorded assignments of mortgage, the Seller shall deliver
or cause to be delivered to the Custodian, a photocopy of such intervening
assignment, together with (i) in the case of a delay caused by the public
recording office, an Officer's Certificate of the Seller stating that such
intervening assignment of mortgage has been dispatched to the appropriate public
recording office for recordation and that such original recorded intervening
assignment of mortgage or a copy of such intervening assignment of mortgage
certified by the appropriate public recording office to be a true and complete
copy of the original recorded intervening assignment of mortgage will be
promptly delivered to the Custodian upon receipt thereof by the Seller; or (ii)
in the case of an intervening assignment where a public recording office retains
the original recorded intervening assignment or in the case where an intervening
assignment is lost after recordation in a public recording office, a copy of
such intervening assignment certified by such public recording office to be a
true and complete copy of the original recorded intervening assignment;
(g) The original mortgagee policy of title insurance or, in the event such
original title policy is unavailable, a certified true copy of the related
policy binder or commitment for title certified to be true and complete by the
title insurance company; and
(h) security agreement, chattel mortgage or equivalent document executed
in connection with the Mortgage.
In the event an Officer's Certificate of the Seller is delivered to the
Purchaser because of a delay caused by the public recording office in returning
any recorded document, the Seller shall deliver to the Purchaser, within ninety
(90) days of the Closing Date, an Officer's Certificate which shall (i) identify
the recorded document, (ii) state that the recorded document has not been
delivered to the Custodian due solely to a delay caused by the public recording
office, (iii) state the amount of time generally required by the applicable
recording office to record and return a document submitted for recordation, and
(iv) specify the date the applicable recorded document will be delivered to the
Custodian; provided, however, that any recorded document shall in any event be
delivered no later than one (1) year from the applicable Closing Date. An
extension of the date specified in (iv) above may be requested from the
Purchaser, which consent shall not be unreasonably withheld.
Exhibit B
EXHIBIT B
REG AB ORIGINATOR DISCLOSURE
The CIT Group/Consumer Finance, Inc. ("CIT") is a Delaware corporation,
which is a licensed mortgage lender and originator of mortgage loans in 45
states. The CIT Group/Consumer Finance, Inc. (NY) ("CITNY") is a New York
corporation and licensed mortgage lender and originator of mortgage loans in the
State of New York. The CIT Group/Consumer Finance, Inc. (TN) ("CITTN") is a
Delaware corporation and licensed mortgage lender and originator of mortgage
loans in the State of Tennessee. CIT, CITNY and CITTN (collectively referred to
as "CIT Home Lending") are each subsidiaries of CIT Group Inc.
CIT Home Lending has been originating mortgage loans in excess of ten
years. CIT Home Lending primarily originates, purchases and services mortgage
loans secured by first or second liens on detached, single-family, residential
properties. Products are both fixed and variable-rate closed-end loans, and
variable-rate lines of credit. Customers borrow to consolidate debts, refinance
an existing mortgage, fund home improvements, pay education expenses and other
reasons. Loans are originated through brokers and correspondents with a high
proportion of home lending applications processed electronically over the
Internet via BrokerEdge, a proprietary system.
The table below sets forth the number and aggregate principal balance of
mortgage loans originated by CIT Home Lending during the periods indicated:
Twelve-Months Ended December 31,
--------------------------------
2001 2002 2003 2004 2005
By Number ...................................
By Aggregate Principal Balance (in
Billions) .................................
General CIT Home Lending Underwriting Guidelines
The CIT Home Lending Underwriting Guidelines. The following information
has been supplied for inclusion in this prospectus supplement by CIT.
Accordingly, neither the issuer, the depositor, the servicer, the trustee, any
of the other originators nor any of the underwriters make any representation or
warranty as to the accuracy, sufficiency and completeness of this information.
The following is a general summary of the CIT Home Lending Underwriting
Guidelines. This summary does not purport to be a complete description of the
underwriting standards of CIT Home Lending. The CIT Home Lending Underwriting
Guidelines are generally intended to evaluate the credit risk of mortgage loans
made to borrowers with imperfect credit histories ranging from minor
delinquencies to bankruptcy, or borrowers with relatively high ratios of monthly
mortgage payments to income or relatively high ratios of total monthly credit
payments to income. In addition, the guidelines also evaluate the value and
adequacy of the mortgaged property as collateral. On a case-by-case basis, CIT
Home Lending may determine that, based upon compensating factors, a prospective
borrower not strictly qualifying under the applicable underwriting guide lines
warrants an underwriting exception. Compensating factors may include, but are
not limited to, relatively low loan-to-value ratio, relatively low
debt-to-income ratio, better than required credit history, stable employment,
financial reserves, and time in residence at the applicant's current address. A
significant number of the mortgage loans may represent such underwriting
exceptions.
The CIT Home Lending Underwriting Guidelines are used by lenders to
evaluate the borrower's credit standing and repayment ability, and the value and
adequacy of the mortgaged property as collateral for the Home Equity Loan. CIT
Home Lending uses a combination of credit scoring and judgmental credit analysis
in making its underwriting decisions. As part of its underwriting process, CIT
Home Lending will adjust the interest rate it charges on each Home Equity Loan
to reflect CIT Home Lending's evaluation of the relative risk associated with a
particular loan applicant. This practice is known as "risk-based" pricing.
Initially, CIT Home Lending's credit criteria focused on high credit
quality loans. These loans generally had shorter terms and were mostly second
mortgages. In 1994, CIT Home Lending introduced risk-based pricing and changed
its credit criteria to include certain specialized loan programs such as high
loan to value, no income verification and purchase money loan programs. Under
these specialized programs, underwriters can approve applicants with certain
positive attributes (such as a high credit score, good credit bureau history, or
characteristics of stability) with low equity in the property, without income
verification, or if the purpose of the loan is to purchase real estate. These
factors might have disqualified the applicant under CIT Home Lending's pre-1994
loan programs. CIT Home Lending believes that the positive attributes of these
applicants overcome the other less favorable indicators that may be present.
In 1995, CIT Home Lending added loan programs accommodating applicants
with a record of more serious credit problems. Under the terms of these
programs, the underwriter places greater emphasis on the applicant's equity in a
home as well as other positive factors which are intended to compensate for the
previous blemished credit record. CIT Home Lending may in the future change the
underwriting policies and procedures described herein.
Description of Underwriting Process. CIT Home Lending's underwriting
process occurs at the local office, regional office, and the home office.
Generally, loan applications are input into an automated application processing
system which allows CIT Home Lending to track its underwriting systematically
and to achieve more uniform underwriting decisions. The system displays both an
internal proprietary credit score and in most cases the credit bureau score
("FICO"). The internal credit score which CIT Home Lending utilizes is a
proprietary model that was purchased from Fair, Xxxxx Company. CIT Home
Lending's internal score is calculated by evaluating the characteristics of each
individual loan application. The characteristics include: (1) occupancy status;
(2) length of time at the residence; (3) length of time at the present employer;
(4) debt to income ratio; (5) bank account references; (6) credit bureau
information; and (7) loan-to-value ratio. The FICO scores of CIT Home Lending
with respect to the Mortgage Loans as of the Cut-Off Date are included in the
tables under "The Mortgage Loan Pool--The Mortgage Loans" herein.
The underwriter evaluates the application and loan package based upon both
the applicable credit scores and other characteristics of the application. The
underwriter may approve or deny the application even if the credit score does
not indicate that approval or denial is warranted if, in the opinion of the
underwriter, other factors exist which would support an approval or denial of
the application.
The extent of an underwriter's credit authority will be based in part on
certain minimum FICO score. The Chief Underwriter of CIT Home Lending assigns
credit authority to individual underwriters based upon their experience and
understanding of CIT Home Lending's underwriting policies and procedures. There
is a hierarchy of credit authority in the organization beginning at the office
level, progressing to the regional office and then to headquarters. If an
underwriter believes that an approval is warranted but the underwriter does not
have the authority to issue a loan approval, the underwriter recommends the loan
application to the next higher credit authority. This more senior underwriter
may have the appropriate level of authority to approve the loan. This process
insures that an underwriter with the appropriate level of experience is
reviewing the loan application.
CIT Home Lending's Credit Department management monitors the performance
of its underwriters. CIT Home Lending has produced and consistently updates
written policies and procedures detailing the loan underwriting process and
procedures as well as the loan programs. Generally, loan applications are
subject to a credit investigation. A prospective borrower applying for a home
equity loan directly from CIT Home Lending is required to fill out or to submit
information to complete an application. The application is designed to provide
to the underwriter pertinent credit information with respect to the applicant `s
liabilities, income, credit history, employment history and personal
information. In addition, with respect to each purchase money mortgage, each
applicant may be required to have adequate cash to pay the down payment and
closing costs. Credit reports, whether or not received as part of the original
loan application, are generally obtained and reviewed for all lines of business.
CIT Home Lending requires a credit report on each applicant from a credit
reporting company. The credit report typically contains information relating to
such matters as credit history with local and national merchants and lenders,
installment debt payments and any record of defaults, bankruptcy, repossession,
suits or judgments. All adverse information obtained relative to legal actions,
payment records and character may be required to be satisfactorily explained and
acceptable to the underwriter. The applicant may also be required to provide a
letter explaining all late payments on mortgage and consumer (i.e.,
non-mortgage) debt noted on the credit report. CIT Home Lending generally
obtains other evidence of employment to verify information provided by the
borrower. CIT Home Lending sometimes obtains a written verification from the
borrower's employer. This verification usually reports the length of employment
with that organization, the borrower's current salary and whether it is expected
that the borrower will continue such employment in the future. Instead of the
written verification from the borrower's employer, CIT Home Lending may instead
obtain from the applicant recent tax returns or other tax forms (e.g., W-2
forms) or current pay stubs or bank statements or may telephone the applicant's
employer to verify an applicant's employment status. If the employer will not
verify employment history over the telephone, CIT Home Lending may rely solely
on the other information provided by the applicant. If a prospective borrower is
self-employed, the borrower may be required to submit copies of the two most
recent signed tax returns. The borrower may also be required to authorize
verification of deposits at financial institutions where the borrower has demand
or savings accounts.
As part of the loan approval, the underwriter will assign a credit risk
rating or program code to the proposed loan. The underwriter may also add
written conditions required in order to fund the loan.
Institutional Bulk Portfolio Underwriting. In the case of an Institutional
Bulk Portfolio, CIT Home Lending underwrites the entire portfolio of loans to
determine if these loans would, at the time of their origination, have met the
underwriting criteria of CIT Home Lending. If, during the credit review of an
Institutional Bulk Portfolio, CIT Home Lending determines that the loans do not
conform to its underwriting standards, CIT Home Lending may purchase the
Institutional Bulk Portfolio at a price which CIT Home Lending believes will
reflect the increased risk in the portfolio.
Valuation Underwriting - General. In determining the adequacy of the
mortgaged property as collateral, combined loan-to-value ratio guidelines are
established depending on the type of loan. The maximum combined loan-to-value
ratio is determined by the loan program and credit risk rating. Generally, CIT
Home Lending confirms the value of the property to be mortgaged by appraisals
performed by independent appraisers or other valuation methods.
Valuation Methods and Standards by Different Lines of Business. For loans
originated by CIT Home Lending appraisals are obtained from outside service
companies. These appraisals may be ordered by CIT Home Lending or the broker.
Such appraisals are based upon an appraiser's inspection of the subject property
and verification that such property is in acceptable condition. Following each
appraisal, the appraiser prepares a report which includes a market data analysis
based on recent sales of comparable homes in the area and, when deemed
appropriate, a replacement cost analysis based on the current cost of
constructing a similar home. All appraisals are required to conform to FNMA or
FHLMC appraisal standards then in effect. Every independent appraisal is
reviewed by a CIT Home Lending collateral risk manager during the application
approval process and the final funding is based on the results of that review.
If CIT Home Lending determines that these valuations are inaccurate, it may
reevaluate the appraiser or in some cases require a recourse party to repurchase
the transaction.
CIT Home Lending requires a full appraisal for most transactions based
upon its underwriting guidelines which take into account the loan amount, the
loan to value ratio and the type of property. On a limited basis, CIT Home
Lending may not require a full appraisal for a loan. Instead, CIT Home Lending
may accept a "drive-by" valuation, which is made by an appraiser who may not
inspect the interior of the building. Some drive-by valuations may only involve
a visual observation of the exterior characteristics and condition of the
property and the neighborhood. Since the appraiser has not inspected the
interior dimensions, improvements and conditions of the property, the drive-by
method produces only a general approximation of value for the particular
property. If there is an appraisal which was completed within six months of the
loan application, in certain cases CIT Home Lending may rely on the prior
appraisal.
CIT Home Lending will review the accuracy of appraised values of all or a
portion of the mortgaged properties securing the loans in an Institutional Bulk
Portfolio. This verification may include obtaining review or drive-by appraisals
or relying on an external vendor's automated appraised value database. In
addition, CIT Home Lending's collateral risk managers will generally conduct a
desktop review of the appraisals from the statistical sampling of loan files
selected for due diligence review.
Underwriting - Other Issues. CIT Home Lending has several procedures which
it uses to verify the applicant's outstanding balance and payment history on any
senior mortgage, including direct verification from the senior mortgage lender.
If the senior mortgage lender does not verify this information by telephone, CIT
Home Lending may rely upon information provided by the applicant, such as a
recent statement from the senior lender and evidence of payment, such as
canceled checks, or upon information provided by national credit bureaus.
Once all applicable employment, credit and property information is
received, CIT Home Lending makes a determination as to whether the prospective
borrower has sufficient monthly income available to meet the borrower's (i)
monthly obligations on the proposed mortgage and any other mortgage debt on the
mortgaged property and other expenses related to the mortgaged property (such as
property taxes and hazard insurance), (ii) and other financial obligations.
Specialized underwriting programs described below may also apply to prospective
borrowers.
Currently, CIT Home Lending generally accepts debt service ratios with
respect to fixed-rate loans and adjustable-rate loans of up to 55% of the
proposed borrower's estimated monthly gross income, generally based upon
historically consistent income over a two year period. For adjustable-rate
loans, CIT Home Lending computes the borrower's monthly obligation on the
proposed loan using the initial mortgage amount and the maximum mortgage rate
permitted after one year.
CIT Home Lending also offers different loan programs with different
underwriting standards, particularly with respect to the level of loan
documentation and the mortgagor's income and credit history, in appropriate
cases where factors such as low combined loan-to-value ratios or other favorable
credit factors exist.
Certain of the types of loans in CIT Home Lending's portfolio have been
originated under new programs and may involve additional credit uncertainties
not present in traditional types of loans. For example, certain of the loans may
provide for escalating or variable payments by the mortgagor. CIT Home Lending
may underwrite such a loan on the basis of a judgment that the mortgagor can
make the initial monthly payments. In some instances, however, a mortgagor may
not have sufficient income to continue to make the required loan payments as
such payments increase. CIT Home Lending may also underwrite such a loan in
reliance on combined loan-to-value ratios or other favorable credit factors.
CIT Home Lending will not purchase or close a Home Equity Loan prior to
receiving evidence that the property securing the loan is insured against
casualty loss. CIT Home Lending requires evidence of fire and extended coverage
casualty insurance on the home in an amount at least equal to the principal
balance of the related loan plus, in the case of a loan secured by a subordinate
priority lien on the mortgaged property, the amount of each mortgage secured by
senior priority liens, or, if required by law, the replacement cost of the
property if such replacement cost is less than the mortgages.
In addition, at the closing, the borrower is required to sign a letter
addressed to his insurance carrier naming CIT Home Lending as a loss payee under
the insurance policy, which CIT Home Lending will thereafter mail to the
insurer. Accordingly, CIT Home Lending normally will not be named as a loss
payee with respect to the property securing the Home Equity Loan at the time the
loan is made or purchased and insurance proceeds might not be available to cover
any loss to CIT Home Lending.
After closing, CIT Home Lending monitors the continued existence of
casualty insurance on the mortgaged properties. CIT Home Lending will "force
place" casualty insurance coverage if CIT Home Lending discovers that casualty
insurance coverage has lapsed.
CIT Home Lending prior to July 1, 2001 required title insurance on all of
its mortgage loans secured by liens on real property if: (1) the principal
balance is over $100,000; (2) the combined loan-to-value ratio is greater than
85% on a first lien position; (3) the borrower is a trust; (4) there is a
transfer of title; (5) closing is conducted pursuant to a power of attorney; (6)
the home was not subject to an existing mortgage; or (7) the first lien holder
is a not an institutional lender. In cases where CIT Home Lending did not
require title insurance, it instead obtains a last owner title search which is
ordered to verify that the borrower is the last owner of record of the mortgaged
property. On July 1, 2001, CIT Home Lending began requiring full title insurance
on all loans in most states.
The actual maximum amount that CIT Home Lending will lend is determined by
an evaluation of the applicant's ability to repay the loan, the value of the
applicant's equity in the real estate, and the ratio of such equity to the real
estate's appraised value.
Specialized Underwriting Programs. CIT Home Lending also originates or
purchases loans pursuant to alternative sets of underwriting criteria under its
No Income Verification program. Under this program, relatively more emphasis is
placed on property underwriting than on credit underwriting and certain credit
underwriting documentation concerning income and employment verification
therefore is waived. Home Equity Loans underwritten under these programs are
limited to self-employed borrowers and certain wage earners with credit
histories that demonstrate an established ability to repay indebtedness in a
timely fashion. Borrowers with poorer credit histories are considered with lower
combined loan-to-value ratios. Permitted maximum combined loan-to-value ratios
under these programs are more restrictive than under CIT Home Lending's standard
underwriting criteria.
These programs are designed to facilitate the loan approval process and
thereby improve CIT Home Lending's competitive position among other mortgage
loan originators. Under the No Income Verification program, the customer does
not provide income documentation to CIT Home Lending. The stated income must
appear reasonable and realistic to the underwriter compared to the customer's
assets and credit history. In March 1998, CIT Home Lending began accepting No
Income Verification program applications secured by non-owner occupied
properties.
CIT Home Lending may modify or eliminate these specialized underwriting
programs from time to time. CIT Home Lending may also introduce new, additional
specialized underwriting programs in the future, which may modify the
underwriting guidelines set forth herein.
Quality Control. CIT Home Lending implements quality control programs in
three areas: 1) lending and documentation standards, 2) re-underwriting of the
loan, and 3) re-verification of employment. CIT Home Lending applies the lending
and documentation standards quality control program to its own originations and
to purchased loans. The quality control procedures are designed to assure that a
consistent level of quality applies to all loans in the portfolio, regardless of
source. CIT Home Lending may vary quality control procedures based upon the
business source for the loan. CIT Home Lending also performs general quality
control review through a central quality control effort. These procedures
include a review of a sample of originated and purchased loans from each of CIT
Home Lending's production offices. Every office is audited monthly and loans
originated during prior months are reviewed for compliance with lending and
documentation standards. In addition, loans originated by CIT Home Lending are
audited on a monthly basis for compliance with lending and documentation
standards. In addition, CIT Home Lending re-verifies employment of its
borrowers. These re-verifications are conducted monthly on some of the loans in
the portfolio to detect fraud and to confirm the accuracy of the information
provided in the application.
Exhibit C
EXHIBIT C
FORM OF OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected [Vice]
President of ________________[COMPANY], a [state] [federally] chartered
institution organized under the laws of the [state of ____________] [United
States] (the "Company"), and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete copy of
the charter of the Company which is in full force and effect on the date
hereof and which has been in effect without amendment, waiver, rescission or
modification since ___________.
2. Attached hereto as Exhibit 2 is a true, correct and complete copy of
the bylaws of the Company which are in effect on the date hereof and which
have been in effect without amendment, waiver, rescission or modification
since ___________.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Company issued within ten (10) days of the date hereof, and
no event has occurred since the date thereof which would impair such
standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete copy of
the corporate resolutions of the Board of Directors of the Company
authorizing the Company to execute and deliver [each of [the Mortgage Loan
Purchase and Interim Servicing Agreement, dated as of January 1, 2007, by and
between IXIS Real Estate Capital Inc. (the "Purchaser") and the Company (the
"Purchase Agreement"),] [and to endorse the Mortgage Notes and execute the
Assignments of Mortgages by original [or facsimile] signature,]] and such
resolutions are in effect on the date hereof and have been in effect without
amendment, waiver, rescission or modification since ____________.
5. Either (i) 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 the Purchase
Agreement, the sale of the mortgage loans or the consummation of the
transactions contemplated by the agreements; or (ii) any required consent,
approval, authorization or order has been obtained by the Company.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of the Purchase Agreement conflicts or will
conflict with or results or will result in a breach of or constitutes or will
constitute a default under the charter or by-laws of the Company, the terms
of any indenture or other agreement or instrument to which the Company is a
party or by which it is bound or to which it is subject, or any statute or
order, rule, regulations, writ, injunction or decree of any court,
governmental authority or regulatory body to which the Company is subject or
by which it is bound.
7. To the best of my knowledge, there is no action, suit, proceeding or
investigation pending or threatened against the Company which, in my
judgment, either in any one instance or in the aggregate, may result in any
material adverse change in the business, operations, financial condition,
properties or assets of the Company or in any material impairment of the
right or ability of the Company to carry on its business substantially as now
conducted or in any material liability on the part of the Company or which
would draw into question the validity of the Purchase Agreement or the
mortgage loans or of any action taken or to be taken in connection with the
transactions contemplated hereby, or which would be likely to impair
materially the ability of the Company to perform under the terms of the
Purchase Agreement.
8. Each person listed on Exhibit 5 attached hereto who, as an officer
or representative of the Company, signed (a) the Purchase Agreement, and (b)
any other document delivered or on the date hereof in connection with any
purchase described in the agreements set forth above was, at the respective
times of such signing and delivery, and is now, a duly elected or appointed,
qualified and acting officer or representative of the Company, who holds the
office set forth opposite his or her name on Exhibit 5, and the signatures of
such persons appearing on such documents are their genuine signatures.
9. The Company is duly authorized to engage in the transactions
described and contemplated in the Purchase Agreement.
Exhibit C
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of
the Company.
Dated:____________________ By:___________________________
Name:___________________
[Seal] Title: [Vice] President
I, ________________________, an [Assistant] Secretary of ______________
[COMPANY], hereby certify that ____________ is the duly elected, qualified and
acting [Vice] President of the Company and that the signature appearing above is
[her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated:____________________ By:___________________________
Name:___________________
Title: [Assistant] Secretary
Exhibit C
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
Exhibit D
EXHIBIT D
FORM OF OPINION OF COUNSEL
TO THE SELLER AND INTERIM SERVICER (date)
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General Counsel to
___________________ (the "Company"), with respect to certain matters in
connection with the sale by the Company of the Mortgage Loans pursuant to that
certain Mortgage Loan Purchase and Interim Servicing Agreement by and between
the Company and IXIS Real Estate Capital Inc. (the "Purchaser"), dated as of
January 1, 2007 (the "Purchase Agreement") which sale is in the form of whole
loans, serviced pursuant to the Purchase Agreement and, collectively with the
Purchase Agreement, the "Agreements"). Capitalized terms not otherwise defined
herein have the meanings set forth in the Purchase Agreement and the Interim
Servicing Agreement.
[We] [I] have examined the following documents:
1. the Purchase Agreement;
2. the form of Assignment of Mortgage;
3. the form of endorsement of the Mortgage Notes; and
4 such other documents, records and papers as we have deemed necessary
and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I] have
relied upon the representations and warranties of the Company and the Interim
Servicer contained in the Purchase Agreement. [We] [I] have assumed the
authenticity of all documents submitted to [us] [me] as originals, the
genuineness of all signatures, the legal capacity of natural persons and the
conformity to the originals of all documents.
Based upon the foregoing, it is [our] [my] opinion that:
1. The Company and the Interim Servicer is [type of entity] duly organized,
validly existing and in good standing under the laws of the [United
States] and are qualified to transact business in, and is in good standing
under, the laws of [the state of incorporation].
2. Each of the Company and the Interim Servicer has the power to engage in
the transactions contemplated by the Agreements to which it is a party and
all requisite power, authority and legal right to execute and deliver such
Agreements and to perform and observe the terms and conditions of such
Agreements.
3. Each of the Agreements to which it is a party has been duly authorized,
executed and delivered by the Company and the Interim Servicer, as
applicable, and is a legal, valid and binding agreement enforceable in
accordance with its respective terms against the Company and the Interim
Servicer, as applicable, 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, none of which will materially
interfere with the realization of the benefits provided thereunder or with
the Purchaser's ownership of the Mortgage Loans.
4. Each of the Company and the Interim Servicer has been duly authorized to
allow any of its officers to execute any and all documents by original
signature in order to complete the transactions contemplated by the
Agreements to which it is a party by original [or facsimile] signature in
order to execute the endorsements to the Mortgage Notes and the
Assignments of Mortgages, and the original [or facsimile] signature of the
officer at the Company executing the endorsements to the Mortgage Notes
and the Assignments of Mortgages represents the legal and valid signature
of said officer of the Company.
5. Either (i) 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 or the Interim Servicer of or compliance by the
Company or the Interim Servicer with the Agreements to which it is a party
and the sale of the Mortgage Loans by the Company or the consummation of
the transactions contemplated by the Agreements to which each is a party
or (ii) any required consent, approval, authorization or order has been
obtained by the Company or the Interim Servicer.
6. Neither the consummation of the transactions contemplated by, nor the
fulfillment of the terms of, the Agreements to which it is a party
conflicts or will conflict with or results or will result in a breach of
or constitutes or will constitute a default under the charter, by-laws or
other organizational documents of the Company or the Interim Servicer, as
applicable, the terms of any indenture or other agreement or instrument to
which the Company or the Interim Servicer is a party or by which it is
bound or to which it is subject, or violates any statute or order, rule,
regulations, writ, injunction or decree of any court, governmental
authority or regulatory body to which the Company or the Interim Servicer
is subject or by which it is bound.
7. There is no action, suit, proceeding or investigation pending or
threatened against the Company or the Interim Servicer which, in [our]
[my] judgment, either in any one instance or in the aggregate, may result
in any material adverse change in the business, operations, financial
condition, properties or assets of the Company or the Interim Servicer or
in any material impairment of the right or ability of the Company or the
Interim Servicer to carry on its business substantially as now conducted
or in any material liability on the part of the Company or the Interim
Servicer or which would draw into question the validity of the Agreements
to which it is a party or the Mortgage Loans or of any action taken or to
be taken in connection with the transactions contemplated thereby, or
which would be likely to impair the ability of the Company or the Interim
Servicer to perform under the terms of the Agreements to which it is a
party.
8. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Agreements is sufficient to fully transfer to the
Purchaser all right, title and interest of the Company thereto as
noteholder and mortgagee.
9. The Mortgages have been duly assigned and the Mortgage Notes have been
duly endorsed as provided in the Purchase Agreement. The Assignments of
Mortgage are in recordable form, except for the insertion of the name of
the assignee, and upon the name of the assignee being inserted, are
acceptable for recording under the laws of the state where each related
Mortgaged Property is located. The endorsement of the Mortgage Notes, the
delivery to the Purchaser, or its designee, of the Assignments of
Mortgage, and the delivery of the original endorsed Mortgage Notes to the
Purchaser, or its designee, are sufficient to permit the Purchaser to
avail itself of all protection available under applicable law against the
claims of any present or future creditors of the Company, and are
sufficient to prevent any other sale, transfer, assignment, pledge or
hypothecation of the Mortgages and the Mortgage Notes by the Company from
being enforceable.
This opinion is given to you for your sole benefit, and no other person or
entity is entitled to rely hereon except that the purchaser or purchasers to
which you initially and directly resell the Mortgage Loans may rely on this
opinion as if it were addressed to them as of its date.
I am admitted to practice only in the State of New York and the State of
New Jersey. I am not admitted to the Bar in any other State and I do not express
as opinion as to the laws of any jurisdiction other than the laws of the State
of New York and the State of New Jersey, the General Corporate Law of the State
of Delaware and the laws of the United States of America.
Very truly yours,
------------------------------------
[Name]
[Assistant] General Counsel
Exhibit E
EXHIBIT E
DELINQUENCY COLLECTION PRACTICES AND PROCEDURES
Exhibit F
EXHIBIT F
[RESERVED]
Exhibit G
EXHIBIT G
[RESERVED]
Exhibit H
EXHIBIT H
ASSIGNMENT AND CONVEYANCE
On this ___ day of __________, ____, ___________________ ("Seller"), as
(i) the Seller under that certain Purchase Price and Terms Agreement, dated as
of ___________, _____ (the "PPTA"), (ii) the Seller under that certain Mortgage
Loan Purchase and Interim Servicing Agreement, dated as of ________, ____ (the
"Purchase Agreement") together with the PPTA, the "Agreements") does hereby
sell, transfer, assign, set over and convey to IXIS Real Estate Capital Inc.
("Purchaser") as the Purchaser under the Agreements, without recourse, but
subject to the terms of the Agreements, all right, title and interest of, in and
to the Mortgage Loans listed on the Mortgage Loan Schedule attached hereto as
Exhibit A (the "Mortgage Loans"), together with the Mortgage Files and all
rights and obligations arising under the documents contained therein. Each
Mortgage Loan subject to the Agreements was underwritten in accordance with, and
conforms to, the Underwriting Guidelines attached hereto as Exhibit C. Pursuant
to Section 6 of the Purchase Agreement, the Seller has delivered to the
Custodian the documents for each Mortgage Loan to be purchased as set forth in
the Custodial Agreement. The contents of each Servicing File required to be
retained by __________________________ ("Interim Servicer") to service the
Mortgage Loans pursuant to the Agreements and thus not delivered to the
Purchaser are and shall be held in trust by the Seller in its capacity as
Interim Servicer for the benefit of the Purchaser as the owner thereof. The
Interim Servicer's possession of any portion of the Servicing File is at the
will of the Purchaser for the sole purpose of facilitating servicing of the
related Mortgage Loan pursuant to the Agreements, and such retention and
possession by the Interim Servicer shall be in a custodial capacity only. The
ownership of each Mortgage Note, Mortgage, the Servicing Rights and the contents
of the Mortgage File and Servicing File is vested in the Purchaser and the
ownership of all records and documents with respect to the related Mortgage Loan
prepared by or which come into the possession of the Seller or the Interim
Servicer shall immediately vest in the Purchaser and shall be retained and
maintained, in trust, by the Seller at the will of the Purchaser in such
custodial capacity only.
The Mortgage Loan Package characteristics of the Mortgage Loans subject
hereto are set forth on Exhibit B hereto.
In accordance with Section 6 of the Purchase Agreement, the Purchaser
accepts the Mortgage Loans listed on Exhibit A attached hereto. Notwithstanding
the foregoing the Purchaser does not waive any rights or remedies it may have
under the Agreements.
Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
Exhibit H
[SELLER]
By:______________________________________
Name:_________________________________
Title:________________________________
Accepted and Agreed:
IXIS REAL ESTATE CAPITAL INC.
By:_____________________________
Name:________________________
Title:_______________________
By:_____________________________
Name:________________________
Title:_______________________
Exhibit H
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
Exhibit H
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL CHARACTERISTICS OF
EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on the
related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than _ months prior to the related
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than
___; or (5) a debt-to-income ratio of more than __%. Each First Lien Loan has a
Mortgage Interest Rate of at least ___% per annum and an outstanding principal
balance less than $_________. Each Second Lien Loan has a Mortgage Interest Rate
of at least ______% per annum and an outstanding principal balance less than
$________. Each Adjustable Rate Mortgage Loan has an Index of [_______].
Exhibit H
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
Exhibit I
EXHIBIT I
SELLER'S UNDERWRITING GUIDELINES
Exhibit J
EXHIBIT J
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [____________ __,
20__] ("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"),
[____________________] ("Assignee") and [SELLER] (the "Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns to
the Assignee all of the right, title and interest of the Assignor, as purchaser,
in, to and under (a) those certain Mortgage Loans listed on the schedule (the
"Mortgage Loan Schedule") attached hereto as Exhibit A (the "Mortgage Loans")
and (b) except as described below, that certain Mortgage Loan Purchase and
Interim Servicing Agreement (the "Purchase Agreement"), dated as of [DATE],
between the Assignor, as purchaser (the "Purchaser"), and the Company, as
seller, solely insofar as the Purchase Agreement relates to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (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
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser under Section 9.04 of the Purchase Agreement.
Recognition of the Company
2. 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 Purchase Agreement (solely to the
extent set forth herein) and this Agreement to [__________________] (the
"Trust") created pursuant to a Pooling and Servicing Agreement, dated as of
[______], 2002 (the "Pooling Agreement"), among the Assignee, the Assignor,
[___________________], as trustee (including its successors in interest and any
successor trustees under the Pooling Agreement, the "Trustee"),
[____________________], as servicer (including its successors in interest and
any successor servicer under the Pooling Agreement, the "Servicer"). The Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the Mortgage Loans, (iii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf) shall have all the rights and remedies
available to the Assignor, insofar as they relate to the Mortgage Loans, under
the Purchase Agreement, including, without limitation, the enforcement of the
document delivery requirements set forth in Section 6 of the Purchase Agreement,
and shall be entitled to enforce all of the obligations of the Company
thereunder insofar as they relate to the Mortgage Loans, and (iv) all references
to the Purchaser, the Custodian or the Bailee under the Purchase Agreement
insofar as they relate to the Mortgage Loans, shall be deemed to refer to the
Trust (including the Trustee and the Servicer acting on the Trust's behalf).
Neither the Company nor the Assignor shall amend or agree to amend, modify,
waiver, or otherwise alter any of the terms or provisions of the Purchase
Agreement which amendment, modification, waiver or other alteration would in any
way affect the Mortgage Loans or the Company's performance under the Purchase
Agreement with respect to the Mortgage Loans without the prior written consent
of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee and
the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and authority
to perform its obligations under the Purchase Agreement. The execution by the
Company of this Agreement is in the ordinary course of the Company's business
and will not conflict with, or result in a breach of, any of the terms,
conditions or provisions of the Company's charter or bylaws or any legal
restriction, or any material agreement or instrument to which the Company is
now a party or by which it is bound, or result in the violation of any law,
rule, regulation, order, judgment or decree to which the Company or its
property is subject. The execution, delivery and performance by the Company
of this Agreement have been duly authorized by all necessary corporate action
on part of the Company. This Agreement has been duly executed and delivered
by the Company, and, upon the due authorization, execution and delivery by
the Assignor and the Assignee, will constitute the valid and legally binding
obligation of the Company, enforceable against the Company in accordance with
its terms except as enforceability may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws now or hereafter
in effect relating to creditors' rights generally, and by general principles
of equity regardless of whether enforceability is considered in a proceeding
in equity or at law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be
obtained or made by the Company in connection with the execution, delivery or
performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency or
other tribunal, which would draw into question the validity of this Agreement
or the Purchase Agreement, or which, either in any one instance or in the
aggregate, would result in any material adverse change in the ability of the
Company to perform its obligations under this Agreement or the Purchase
Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company hereby
represents and warrants, for the benefit of the Assignor, the Assignee and the
Trust, that the representations and warranties set forth in Section 9.02 of the
Purchase Agreement are true and correct as of the date hereof as if such
representations and warranties were made on the date hereof unless otherwise
specifically stated in such representations and warranties.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies available
to the Assignor, the Assignee and the Trust (including the Trustee and the
Servicer acting on the Trust's behalf) in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3 and 4
hereof shall be as set forth in Subsection 9.03 of the Purchase Agreement as if
they were set forth herein (including without limitation the repurchase and
indemnity obligations set forth therein).
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of the
State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced, with the prior written
consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf). Any entity into which Assignor, Assignee
or Company may be merged or consolidated shall, without the requirement for any
further writing, be deemed Assignor, Assignee or Company, respectively,
hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with any
provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
[SELLER]
By: ____________________________________
Name:_______________________________
Its:________________________________
IXIS REAL ESTATE CAPITAL INC.
By: ____________________________________
Name:_______________________________
Its:________________________________
By: ____________________________________
Name:_______________________________
Its:________________________________
[__________________________]
By: ____________________________________
Name:_______________________________
Its:________________________________
Exhibit J
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
Exhibit K
EXHIBIT K
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"), dated as
of [_______], 200_, [among/between] IXIS Real Estate Capital Inc., a New York
corporation ("IXIS"), [_____________], a [_______________] (the "Seller") and
[_____________], a [_______________] [(the "Initial Servicer")].
WHEREAS, [________________] (the "Depositor"), is acting as depositor
and registrant with respect to the Prospectus, dated [________________], and
the Prospectus Supplement to the Prospectus, [________________] (the
"Prospectus Supplement"), relating to [________________] Certificates (the
"Certificates") to be issued pursuant to a Pooling and Servicing Agreement,
dated as of [________________] (the "P&S"), among the Depositor, as
depositor, [________________], as servicer (the "Servicer"), and
[________________], as trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S, and
[____________________] (the "Underwriter[s]") to enter into the Underwriting
Agreement, dated [____________________] (the "Underwriting Agreement") between
the Depositor and the Underwriter[s], Seller has agreed to provide for
indemnification and contribution on the terms and conditions hereinafter set
forth;
WHEREAS, IXIS purchased from Seller certain of the Mortgage Loans
underlying the Certificates (the "Mortgage Loans") from Seller pursuant to a
Mortgage Loan Purchase and Interim Servicing Agreement, dated as of [DATE] (the
"Purchase Agreement"), by and between IXIS and Seller; and
WHEREAS, pursuant to Section 13 of the Purchase Agreement, Seller has
agreed to indemnify IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents.
NOW THEREFORE, in consideration of the agreements contained herein, and
other valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Seller and IXIS agree as follows:
1. Indemnification and Contribution.
(a) Seller [and Initial Servicer] agrees to indemnify and hold harmless
IXIS, the Depositor, the Underwriter[s] and their respective affiliates, present
and former directors, officers, employees and agents and each person, if any,
who controls IXIS, the Depositor, the Underwriter[s] or such affiliate within
the meaning of either Section 15 of the Securities Act of 1933, as amended (the
"1933 Act"), or Section 20 of the Securities Exchange Act of 1934, as amended
(the "1934 Act"), against any and all losses, claims, damages or liabilities,
joint or several, to which they or any of them may become subject under the 1933
Act, the 1934 Act or other federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based in whole or in part
upon (i) any violation of the representation and warranty set forth in Section
2(vii) below or (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus or any omission or
alleged omission to state in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus 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, or any such
untrue statement or omission or alleged untrue statement or alleged omission
made in any amendment of or supplement to the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus and
agrees to reimburse IXIS, the Depositor, the Underwriter[s] or such affiliates
and each such officer, director, employee, agent and controlling person promptly
upon demand for any legal or other expenses reasonably incurred by any of them
in connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that Seller [and Initial Servicer] shall be liable in any
such case only to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with the Seller Information[ and Servicer Information]. The foregoing
indemnity agreement is in addition to any liability which Seller[ and the
Initial Servicer] may otherwise have to IXIS, the Depositor, the Underwriter[s]
its affiliates or any such director, officer, employee, agent or controlling
person of IXIS, the Depositor, the Underwriter[s] or their respective
affiliates.
As used herein:
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act and
the 1934 Act, as amended from time to time.
"Free Writing Prospectus" means any written communication that constitutes
a "free writing prospectus," as defined in Rule 405 under the 1933 Act.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or
by the staff of the Commission, or as may be provided by the Commission or its
staff from time to time.
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines[ and/or servicing guidelines]
relating to the Mortgage Loans set forth in the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus [and
static pool information regarding mortgage loans originated or acquired by the
Seller [and included in the Prospectus Supplement, ABS Informational and
Computational Material, the Offering Circular or the Free Writing Prospectus]
[incorporated by reference from the website located at
[______________]].
["Servicer Information" means any information relating to Initial
Servicer, the Mortgage Loans and/or the servicing guidelines relating to the
Mortgage Loans set forth in the Prospectus Supplement, ABS Informational and
Computational Material or the Free Writing Prospectus [and static pool
information regarding mortgage loans originated or acquired by the Initial
Servicer [and included in the Prospectus Supplement, the Offering Circular,
ABS Informational and Computational Material or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].]
(b) Promptly after receipt by any indemnified party under this Section 1
of notice of any claim or the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against any indemnifying
party under this Section 1, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify an indemnifying party shall not relieve it from any liability which it
may have under this Section 1 except to the extent it has been materially
prejudiced by such failure; and provided, further, however, that the failure to
notify any indemnifying party shall not relieve it from any liability which it
may have to any indemnified party otherwise than under this Section 1.
If any such claim or action shall be brought against an indemnified party,
and it shall notify the indemnifying party thereof, the indemnifying party shall
be entitled to participate therein and, to the extent that it wishes, jointly
with any other similarly notified indemnifying party, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party. After
notice from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, except as provided in the following
paragraph, the indemnifying party shall not be liable to the indemnified party
under this Section 1 for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof other than
reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel in
any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties.
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for reasonable fees and expenses of counsel, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than thirty (30)
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement.
(c) If the indemnification provided for in this Section 1 is unavailable
to an indemnified party, then the indemnifying party, in lieu of indemnifying
such indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities, in
such proportion as is appropriate to reflect the relative fault of the
indemnifying party and the indemnified party, respectively, in connection with
the statements or omissions that result in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the indemnified party and indemnifying party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission and any other equitable considerations.
(d) The indemnity and contribution agreements contained in this Section 1
and the representations and warranties set forth in Section 2 shall remain
operative and in full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by IXIS, the Depositor, the
Underwriter[s] their respective affiliates, directors, officers, employees or
agents or any person controlling IXIS, the Depositor, the Underwriter[s] or any
such affiliate and (iii) acceptance of and payment for any of the Offered
Certificates.
2. Representations and Warranties. Seller [and Initial Servicer]
represents and warrants that:
(i) Seller [and Initial Servicer] is validly existing and in good standing
under the laws of its jurisdiction of formation or incorporation, as
applicable, and has full power and authority to own its assets and to
transact the business in which it is currently engaged. Seller [and Initial
Servicer] is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the business transacted by it or any
properties owned or leased by it requires such qualification and in which the
failure so to qualify would have a material adverse effect on the business,
properties, assets or condition (financial or otherwise) of Seller [and
Initial Servicer];
(ii) Seller [and Initial Servicer] is not required to obtain the consent
of any other person or any consent, license, approval or authorization from,
or registration or declaration with, any governmental authority, bureau or
agency in connection with the execution, delivery, performance, validity or
enforceability of this Agreement;
(iii) the execution, delivery and performance of this Agreement by Seller
[and Initial Servicer] will not violate any provision of any existing law or
regulation or any order decree of any court applicable to Seller [and Initial
Servicer] or any provision of the charter or bylaws of Seller [and Initial
Servicer], or constitute a material breach of any mortgage, indenture,
contract or other agreement to which Seller [and Initial Servicer] is a party
or by which it may be bound;
(iv) (a) no proceeding of or before any court, tribunal or governmental
body is currently pending or, (b) to the knowledge of Seller [and Initial
Servicer], threatened against Seller [and Initial Servicer] or any of its
properties or with respect to this Agreement or the Offered Certificates, in
either case, which would have a material adverse effect on the business,
properties, assets or condition (financial or otherwise) of Seller [and
Initial Servicer];
(v) Seller [and Initial Servicer] has full power and authority to make,
execute, deliver and perform this Agreement and all of the transactions
contemplated hereunder, and has taken all necessary corporate action to
authorize the execution, delivery and performance of this Agreement. When
executed and delivered, this Agreement will constitute the legal, valid and
binding obligation of each of Seller [and Initial Servicer] enforceable in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally, by the availability
of equitable remedies, and by limitations of public policy under applicable
securities law as to rights of indemnity and contribution thereunder;
(vi) this Agreement has been duly executed and delivered by Seller [and
Initial Servicer]; and
(vii) the [Seller Information][Servicer Information] satisfies the
requirements of the applicable provisions of Regulation AB.
3. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to Seller [and Initial Servicer], will be mailed,
delivered or telegraphed and confirmed [______________________]; or, if sent to
IXIS, will be mailed, delivered or telegraphed and confirmed to IXIS Real Estate
Capital Inc., 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General
Counsel.
4. Miscellaneous. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York without giving effect to the
conflict of laws provisions thereof. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their successors and assigns and
the controlling persons referred to herein, and no other person shall have any
right or obligation hereunder. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against whom enforcement of the change, waiver,
discharge or termination is sought. This Agreement may be executed in
counterparts, each of which when so executed and delivered shall be considered
an original, and all such counterparts shall constitute one and the same
instrument. Capitalized terms used but not defined herein shall have the
meanings provided in the P&S.
[Remainder of Page Intentionally Left Blank]
Exhibit H
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers hereunto duly authorized, this
__th day of [_____________].
IXIS REAL ESTATE CAPITAL INC.
By:
_____________________________________
Name:
Title:
By:
_____________________________________
Name:
Title:
[SELLER]
By:
_____________________________________
Name:
Title:
[INITIAL SERVICER]
By:
_____________________________________
Name:
Title:
EXHIBIT DD
FIRST HORIZON AGREEMENTS
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated April 30, 2007
("Agreement"), among Natixis Real Estate Capital Inc. ("Assignor"), Xxxxxx
Xxxxxxx ABS Capital I Inc. ("Assignee") and First Horizon Home Loan Corporation
(the "Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns to
the Assignee all of the right, title and interest of the Assignor, as purchaser,
in, to and under (a) those certain Mortgage Loans listed on the schedule (the
"Mortgage Loan Schedule") attached hereto as Exhibit A (the "Mortgage Loans")
and (b) except as described below, that certain Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement (the "Purchase Agreement"),
dated as of July 1, 2006, between the Assignor, as purchaser (the "Purchaser"),
and the Company, as seller, solely insofar as the Purchase Agreement relates to
the Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (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
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser (a) under Subsection 9.04 of the Purchase Agreement or (b) to any
premium recapture (i.e., the excess, if any, of the purchase price percentage
over par) in connection with any repurchase pursuant to Subsections 9.03 and
9.05 of the Purchase Agreement or (iii) any right to require the Company to
repurchase a Mortgage Loan pursuant to Subsection 9.05(b) of the Purchase
Agreement unless the related Mortgagor is delinquent with respect to such
Mortgage Loan's first Monthly Payment after origination.
Recognition of the Company
2. 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 Purchase Agreement (solely to the
extent set forth herein) and this Agreement to Natixis Real Estate Capital Trust
2007-HE2 (the "Trust") created pursuant to a Pooling and Servicing Agreement,
dated as of April 1, 2007 (the "Pooling Agreement"), among the Assignee, the
Assignor, Deutsche Bank National Trust Company, as trustee (in such capacity,
including its successors in interest and any successor trustees under the
Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National Association, as
securities administrator (in such capacity, including its successors in interest
and any successor securities administrators under the Pooling Agreement, the
"Securities Administrator"), master servicer (in such capacity, including its
successors in interest and any successor master servicers under the Pooling
Agreement, the "Master Servicer") and Saxon Mortgage Services, Inc., as servicer
(including its successors in interest and any successor servicer under the
Pooling Agreement, the "Servicer"). The Company hereby acknowledges and agrees
that from and after the date hereof (i) the Trust will be the owner of the
Mortgage Loans, (ii) the Company shall look solely to the Trust for performance
of any obligations of the Assignor insofar as they relate to the Mortgage Loans,
(iii) the Trust (including the Trustee, Securities Administrator, Master
Servicer and the Servicer acting on the Trust's behalf) shall have all the
rights and remedies available to the Assignor, insofar as they relate to the
Mortgage Loans, under the Purchase Agreement, including, without limitation, the
enforcement of the document delivery requirements set forth in Section 6 of the
Purchase Agreement, and shall be entitled to enforce all of the obligations of
the Company thereunder insofar as they relate to the Mortgage Loans, and (iv)
all references to the Purchaser, the Custodian or the Bailee under the Purchase
Agreement insofar as they relate to the Mortgage Loans, shall be deemed to refer
to the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf). Neither the Company nor the
Assignor shall amend or agree to amend, modify, waiver, or otherwise alter any
of the terms or provisions of the Purchase Agreement which amendment,
modification, waiver or other alteration would in any way affect the Mortgage
Loans or the Company's performance under the Purchase Agreement with respect to
the Mortgage Loans without the prior written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee and
the Trust (including the Trustee, Securities Administrator, Master Servicer and
the Servicer acting on the Trust's behalf) as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and authority
to perform its obligations under the Purchase Agreement. The execution by the
Company of this Agreement is in the ordinary course of the Company's business
and will not conflict with, or result in a breach of, any of the terms,
conditions or provisions of the Company's charter or bylaws or any legal
restriction, or any material agreement or instrument to which the Company is
now a party or by which it is bound, or result in the violation of any law,
rule, regulation, order, judgment or decree to which the Company or its
property is subject. The execution, delivery and performance by the Company
of this Agreement have been duly authorized by all necessary corporate action
on part of the Company. This Agreement has been duly executed and delivered
by the Company, and, upon the due authorization, execution and delivery by
the Assignor and the Assignee, will constitute the valid and legally binding
obligation of the Company, enforceable against the Company in accordance with
its terms except as enforceability may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws now or hereafter
in effect relating to creditors' rights generally, and by general principles
of equity regardless of whether enforceability is considered in a proceeding
in equity or at law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be
obtained or made by the Company in connection with the execution, delivery or
performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency or
other tribunal, which would draw into question the validity of this Agreement
or the Purchase Agreement, or which, either in any one instance or in the
aggregate, would result in any material adverse change in the ability of the
Company to perform its obligations under this Agreement or the Purchase
Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company hereby
represents and warrants, for the benefit of the Assignor, the Assignee and the
Trust (including the Trustee, Securities Administrator, Master Servicer and the
Servicer acting on the Trust's behalf), that the representations and warranties
set forth in Section 9.02 (other than (i) the clause "nor has any payment under
the Mortgage Loan been 30 days or more delinquent at any time since the
origination of the Mortgage Loan" or (ii) the last sentence of Section 9.02(b)
as it applies to Due Dates after the date hereof) of the Purchase Agreement are
true and correct as of the date hereof (or, with respect to the Servicing
Transfer Representations, the Transfer Date) as if such representations and
warranties were made on the date hereof unless otherwise specifically stated in
such representations and warranties.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies available
to the Assignor, the Assignee and the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf) in
connection with any breach of the representations and warranties made by the
Company set forth in Sections 3 and 4 hereof shall be as set forth in Subsection
9.03 of the Purchase Agreement as if they were set forth herein (including
without limitation the repurchase and indemnity obligations set forth therein);
provided, however, that the Assignor specifically reserves and does not assign
to the Assignee hereunder any and all right, title and interest in the Premium
Percentage, if any, due in connection with the repurchase of a Mortgage Loan
pursuant to Subsections 9.03, 9.04 and 9.05, or any right to require the Company
to repurchase a Mortgage Loan pursuant to Subsection 9.05(b) of the Purchase
Agreement unless the related Mortgagor is delinquent with respect to such
Mortgage Loan's first Monthly Payment after origination.
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of the
State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced, with the prior written
consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf). Any entity into which Assignor, Assignee or Company may be merged or
consolidated shall, without the requirement for any further writing, be deemed
Assignor, Assignee or Company, respectively, hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with any
provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized officers as of the date first above written.
FIRST HORIZON
HOME LOAN CORPORATION
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxx
Its: Dir. V.P.
NATIXIS REAL ESTATE CAPITAL INC.
By: /s/ Xxxxxxx Xxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxx
Its: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/ Xxxxxxx Xxx
-----------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
================================================================================
SECOND AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT
------------------------------------------------
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
FIRST HORIZON HOME LOAN CORPORATION,
Seller
------------------------------------------------
Dated as of July 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
================================================================================
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS......................................................
SECTION 2. AGREEMENT TO PURCHASE............................................
SECTION 3. MORTGAGE SCHEDULES...............................................
SECTION 4. PURCHASE PRICE...................................................
SECTION 5. EXAMINATION OF MORTGAGE FILES....................................
SECTION 6. CONVEYANCE FROM SELLER TO PURCHASER..............................
Subsection 6.01 Conveyance of Mortgage Loans; Possession of
Servicing Files.............................................
Subsection 6.02 Books and Records...........................................
Subsection 6.03 Delivery of Mortgage Loan Documents.........................
Subsection 6.04 Quality Control Procedures..................................
Subsection 6.05 MERS Designated Mortgage Loans..............................
SECTION 7. SERVICING OF THE MORTGAGE LOANS..................................
SECTION 8. TRANSFER OF SERVICING............................................
SECTION 9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER;
REMEDIES FOR BREACH..............................................
Subsection 9.01 Representations and Warranties Regarding the Seller.........
Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans..............................................
Subsection 9.03 Remedies for Breach of Representations and
Warranties..................................................
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full............
Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults....................................................
Subsection 9.06 [Reserved]..................................................
SECTION 10. CLOSING..........................................................
SECTION 11. CLOSING DOCUMENTS................................................
SECTION 12. COSTS............................................................
SECTION 13. COOPERATION OF SELLER WITH A RECONSTITUTION......................
SECTION 14. THE SELLER.......................................................
Subsection 14.01 Additional Indemnification by the Seller; Third
Party Claims................................................
Subsection 14.02 Merger or Consolidation of the Seller.......................
SECTION 15. FINANCIAL STATEMENTS.............................................
SECTION 16. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST...................
SECTION 17. NOTICES..........................................................
SECTION 18. SEVERABILITY CLAUSE..............................................
SECTION 19. COUNTERPARTS.....................................................
SECTION 20. GOVERNING LAW JURISDICTION; CONSENT TO SERVICE OF
PROCESS..........................................................
SECTION 21. INTENTION OF THE PARTIES.........................................
SECTION 22. SUCCESSORS AND ASSIGNS; ASSIGNMENT OF PURCHASE AGREEMENT.........
SECTION 23. WAIVERS..........................................................
SECTION 24. EXHIBITS.........................................................
SECTION 25. GENERAL INTERPRETIVE PRINCIPLES..................................
SECTION 26. REPRODUCTION OF DOCUMENTS........................................
SECTION 27. FURTHER AGREEMENTS...............................................
SECTION 28. RECORDATION OF ASSIGNMENTS OF MORTGAGE...........................
SECTION 29. NO SOLICITATION..................................................
SECTION 30. WAIVER OF TRIAL BY JURY..........................................
SECTION 31. COMPLIANCE WITH REGULATION AB....................................
Subsection 31.01 Intent of the Parties; Reasonableness.......................
Subsection 31.02 Additional Representations and Warranties of the
Seller......................................................
Subsection 31.03 Information To Be Provided by the Seller....................
Subsection 31.04 Indemnification; Remedies...................................
EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF INTERIM SERVICING AGREEMENT
EXHIBIT C FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE INTERIM
SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G LIST OF PROHIBITED STATES
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I SELLER'S UNDERWRITING GUIDELINES
EXHIBIT J FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT K FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
SECOND AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES AGREEMENT
This SECOND AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES
AGREEMENT (the "Agreement"), dated as of July 1, 2006, by and between IXIS Real
Estate Capital Inc., a New York corporation, having an office at 0 Xxxx 00xx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Purchaser"), and First
Horizon Home Loan Corporation, a Kansas corporation, having an office at 0000
Xxxxxxx Xxxxxxxxx, Xxxxxxxx Xxxx, Xxxxxx 00000 (the "Seller").
W I T N E S S E T H:
WHEREAS, the Purchaser and the Seller are parties to that certain Amended
and Restated Mortgage Loan Purchase and Warranties Agreement, dated as of
October 1, 2005 (the "Original Purchase Agreement"), pursuant to which the
Seller desires to sell, from time to time, to the Purchaser, and the Purchaser
desires to purchase, from time to time, from the Seller, certain first and
second lien, adjustable-rate and fixed-rate B/C residential mortgage loans (the
"Mortgage Loans") on a servicing released basis as described herein, and which
shall be delivered in pools of whole loans (each, a "Mortgage Loan Package") on
various dates as provided herein (each, a "Closing Date");
WHEREAS, at the present time, the Purchaser and the Seller desire to amend
and restate the Original Purchase Agreement to make certain modifications as set
forth herein and upon the execution and delivery of this Agreement by the
Purchaser and the Seller this Agreement shall supercede the Original Purchase
Agreement and supplant the Original Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and mutual agreements set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller agree
as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms shall have
the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan, those
mortgage servicing practices of prudent mortgage lending institutions which
service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac Transfer.
Agreement: This Mortgage Loan Purchase and Warranties Agreement and all
amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value of the
related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property at such time of origination, whichever is less; provided,
however, that in the case of a refinanced Mortgage Loan, such value is based
solely upon the appraisal made, if any, at the time of origination of such
refinanced Mortgage Loan, and (ii) with respect to any Second Lien Loan, the
value, determined pursuant to the Seller's Underwriting Guidelines, of the
related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in Subsection 6.01.
Assignment of Mortgage: An 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 the
sale of the Mortgage to the Purchaser.
Balloon Mortgage Loan: Any Mortgage Loan that requires only payments of
interest until the stated maturity date of the Mortgage Loan or the Monthly
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by stated maturity date of the Mortgage
Loan.
Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a day
on which banking and savings and loan institutions, in the State of New York or
the state in which the Interim Servicer's servicing operations are located, are
authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to time
shall purchase and the Seller from time to time shall sell the Mortgage Loans
listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value and (2) any First Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the First Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are junior or equal in
priority to the First Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage Loan
purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to Appendix
E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created and maintained
pursuant to Section 2.04 of the Interim Servicing Agreement (with respect to
each Mortgage Loan, for an interim period, as specified therein).
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, to be executed between the Purchaser and the Custodian
and to be dated as of the related Cut-Off Date.
Custodian: The custodian under the Custodial Agreement, or its successor
in interest or assigns, or any successor to the Custodian under the Custodial
Agreement, as therein provided. If at any time there is no Custodial Agreement
in effect with respect to a Mortgage Loan, all references to the Custodian
herein and in the Interim Servicing Agreement shall be deemed to refer to the
Purchaser (or its designee) with respect to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related Mortgage
Loan Schedule with respect to the related Mortgage Loan Package.
Deemed Material Breach Representation: Each representation identified
as such in Subsection 9.02.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or replaced or
to be replaced with a Qualified Substitute Mortgage Loan by the Seller in
accordance with the terms of this Agreement.
Delinquency Collection Policies and Procedures: The delinquency collection
policies and procedures of the Seller, a copy of which is attached to the
Interim Servicing Agreement.
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is due on a
Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal or state
chartered depository institution or trust company the short-term unsecured debt
obligations of which (or, in the case of a depository institution or trust
company that is a subsidiary of a holding company, the short-term unsecured debt
obligations of such holding company) are rated A-1 by Standard & Poor's or
Prime-1 by Moody's (or a comparable rating if another Rating Agency is specified
by the Purchaser by written notice to the Seller) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, or (iii) a trust account or accounts maintained with
a federal or state chartered depository institution or trust company acting in
its fiduciary capacity.
Escrow Account: The separate account or accounts created and maintained
pursuant to Section 2.06 of the Interim Servicing Agreement (with respect to
each Mortgage Loan, for an interim period, as specified therein).
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.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Xxxxxx Mae: The Federal National Mortgage Association and its
successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Xxx
Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 13 hereof.
FDIC: The Federal Deposit Insurance Corporation and its successors in
interest.
FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage on the
related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
Fixed Rate Mortgage Loan: A fixed rate mortgage loan purchased pursuant
to this Agreement.
Xxxxxxx Mac: The Federal Home Loan Mortgage Corporation and its
successors in interest.
Xxxxxxx Mac Transfer: As defined in Section 13 hereof.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan, the
fixed percentage amount set forth in the related Mortgage Note which amount is
added to the Index in accordance with the terms of the related Mortgage Note to
determine on each Interest Rate Adjustment Date the Mortgage Interest Rate for
such Mortgage Loan.
High Cost Loan: A Mortgage Loan (a) covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual percentage rate" or
total "points and fees" payable by the related Mortgagor (as each such term is
calculated under HOEPA) that exceed the thresholds set forth by HOEPA and its
implementing regulations, including 12 C.F.R. ss. 226.32(a)(1)(i) and (ii), (c)
classified as a "high cost home," "threshold," "covered," "high risk home,"
"predatory" or similar loan under any other 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) or
(d) a Mortgage Loan categorized as High Cost pursuant to Appendix E of Standard
& Poor's Glossary. For avoidance of doubt, the parties agree that this
definition shall apply to any applicable law regardless of whether such law is
presently, or in the future becomes, the subject of judicial review or
litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also deemed to include subdivisions thereof such as the FHA
and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, a rate per
annum set forth on Exhibit B to each related Assignment and Conveyance
Agreement.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the interim funder pursuant to the MERS
Procedures Manual.
Interim Servicer: First Horizon Home Loan Corporation, a Kansas
corporation, and its successors in interest, and any successor interim servicer
under the Interim Servicing Agreement.
Interim Servicing Agreement: The agreement, attached as Exhibit B hereto,
to be entered into by the Purchaser and the Interim Servicer, providing for the
Interim Servicer to service the Mortgage Loans for an interim period as
specified by the Interim Servicing Agreement.
Investor: With respect to each MERS Designated Mortgage Loan, the Person
named on the MERS(R) System as the investor pursuant to the MERS Procedures
Manual.
Lifetime Rate Cap: The provision of each Mortgage Note related to an
Adjustable Rate Mortgage Loan which provides for an absolute maximum Mortgage
Interest Rate thereunder. The Mortgage Interest Rate during the terms of each
Adjustable Rate Mortgage Loan shall not at any time exceed the Mortgage Interest
Rate at the time of origination of such Adjustable Rate Mortgage Loan by more
than the amount per annum set forth on the related Mortgage Loan Schedule.
Liquidation Proceeds: Cash received in connection with the liquidation of
a defaulted Mortgage Loan, whether through the sale or assignment of such
Mortgage Loan, trustee's sale, foreclosure sale or otherwise, or the sale of the
related Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the ratio
(expressed as a percentage) of the outstanding principal amount of the Mortgage
Loan as of the Cut-off Date (unless otherwise indicated), to the Appraised Value
of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the Seller has
designated or will designate MERS as, and has taken or will take such action as
is necessary to cause MERS to be, the mortgagee of record, as nominee for the
Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor on the MERS(R)
System.
MERS Procedure Manual: The MERS Procedures Manual, as it may be amended,
supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and interest
on a Mortgage Loan.
Moody's: Xxxxx'x Investors Service, Inc. and its successors in interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on the Mortgaged Property.
Mortgage File: The items pertaining to a particular Mortgage Loan referred
to in Exhibit A annexed hereto, and any additional documents required to be
added to the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: The annual rate of interest borne on a Mortgage
Note with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, 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 required to be delivered to the
Custodian pursuant to Section 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans forwarded in an
electronic format setting forth the following information with respect to each
Mortgage Loan in the related Mortgage Loan Package: (1) the Seller's Mortgage
Loan identifying number; (2) the Mortgagor's 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 investment
property; (5) the number and type of residential units constituting the
Mortgaged Property (i.e., a single family residence, a 2-4 family residence, a
unit in a condominium project or a unit in a planned unit development,
manufactured housing); (6) the Mortgage Loan origination date; (7) the original
months to maturity or the remaining months to maturity from the related Cut-off
Date, in any case 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 Loan-to-Value Ratio at origination; (9) with respect to First
Lien Loans, the LTV and with respect to Second Lien Loans, the CLTV; (10) the
Mortgage Interest Rate as of the related Cut-off Date; (11) the date on which
the Monthly Payment was due on the Mortgage Loan and, if such date is not
consistent with the Due Date currently in effect, such Due Date; (12) the stated
maturity date; (13) the amount of the Monthly Payment as of the related Cut-off
Date; (14) the last payment date as of which a payment was actually applied to
the outstanding principal balance; (15) the original principal amount of the
Mortgage Loan; (16) the 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 and collected on or before the Cut-off Date; (17) the Interest
Rate Adjustment Date; (18) the Gross Margin; (19) the Lifetime Rate Cap under
the terms of the Mortgage Note; (20) a code indicating the type of Index; (21)
the Mortgage Interest Rate as of origination; (22) the type of Mortgage Loan
(i.e., fixed-rate, adjustable-rate, First Lien, Second Lien); (23) a code
indicating the purpose of the loan (i.e., purchase, rate and term refinance,
equity take-out refinance); (24) a code indicating the documentation style
(i.e., full or stated income); (25) the loan credit classification (as described
in the Underwriting Guidelines); (26) the applicable Cut-off Date; (27) the
applicable Closing Date; (28) a code indicating whether the Mortgage Loan is a
Home Loan; (29) the credit risk score (FICO score); (30) with respect to the
related Mortgagor, the debt-to-income ratio; (31) with respect to Second Lien
Loans, the outstanding principal balance of the superior lien; (32) the
Appraised Value of the Mortgaged Property; (33) the sale price of the Mortgaged
Property if the Mortgage Loan was originated in connection with the purchase of
the Mortgaged Property; (34) the Periodic Rate Cap under the terms of the
Mortgage Note; (35) the Periodic Rate Floor under the terms of the Mortgage
Note; (36) whether such Mortgage Loan provides for a prepayment penalty; (37)
the prepayment penalty period of such Mortgage Loan, if applicable; (38) a
description of the type of prepayment penalty, if applicable; (39) the MERS
Identification Number; (40) whether the Mortgagor represented that the Mortgagor
would occupy the Mortgaged Property as its primary residence and (41) a code
indicating if the Mortgage Loan is a Balloon Mortgage Loan. With respect to the
Mortgage Loans in the aggregate, the Mortgage Loan Schedule shall set forth the
following information, as of the related Cut-off Date: (1) the number of
Mortgage Loans; (2) the current aggregate outstanding principal balance of the
Mortgage Loans; (3) the weighted average Mortgage Interest Rate of the Mortgage
Loans; and (4) the weighted average maturity of the Mortgage Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the Mortgagor's
real property securing repayment of a related Mortgage Note, consisting of an
unsubordinated estate in fee simple or, 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, in a single parcel or
multiple parcels of real property improved by a residential dwelling as further
described in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its successors in
interest.
Officer's Certificate: A certificate signed by the Chairman of the Board
or the Vice Chairman of the Board or a President or a Vice President and by the
Treasurer or the Secretary or one of the Assistant Treasurers or Assistant
Secretaries of the Seller, and delivered to the Purchaser as required by this
Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel for
the Seller, reasonably acceptable to the Purchaser, provided that any Opinion of
Counsel relating to (a) the qualification of any account required to be
maintained pursuant to this Agreement as an Eligible Account, (b) qualification
of the Mortgage Loans in a REMIC or (c) compliance with the REMIC Provisions,
must be (unless otherwise stated in such Opinion of Counsel) an opinion of
counsel who (i) is in fact independent of the Seller and any servicer of the
Mortgage Loans, (ii) does not have any material direct or indirect financial
interest in the Seller or any servicer of the Mortgage Loans or in an Affiliate
of either and (iii) is not connected with the Seller or any servicer of the
Mortgage Loans as an officer, employee, director or person performing similar
functions.
OTS: Office of Thrift Supervision and its successors in interest.
Periodic Rate Cap: With respect to each Adjustable Rate Mortgage Loan, the
provision of each Mortgage Note which provides for an absolute maximum amount by
which the Mortgage Interest Rate therein may increase on an Interest Rate
Adjustment Date above the Mortgage Interest Rate previously in effect.
Periodic Rate Floor: With respect to each Adjustable Rate Mortgage Loan,
the provision of each Mortgage Note which provides for an absolute maximum
amount by which the Mortgage Interest Rate therein may decrease on an Interest
Rate Adjustment Date below the Mortgage Interest Rate previously in effect.
Person: Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof.
Preliminary Mortgage Schedule: As defined in Section 3.
Premium Percentage: With respect to any Mortgage Loan, a percentage
equal to the excess of the Purchase Price Percentage over 100%.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan which is received in advance of its scheduled Due Date, including
any prepayment penalty or premium thereon and which is not accompanied by an
amount of interest representing scheduled interest due on any date or dates in
any month or months subsequent to the month of prepayment.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements setting forth
the general terms and conditions of the transaction consummated herein and
identifying the Mortgage Loans to be purchased from time to time hereunder, by
and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an amount
equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York corporation, and
its successors in interest and assigns, or any successor to the Purchaser
under this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Seller and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Seller, in accordance with underwriting
guidelines designated by the Seller ("Designated Guidelines") or guidelines that
do not vary materially from such Designated Guidelines; (ii) such Mortgage Loans
were in fact underwritten as described in clause (i) above and were acquired by
the Seller within one hundred eighty (180) days after origination; (iii) either
(x) the Designated Guidelines were, at the time such Mortgage Loans were
originated, used by the Seller in origination of mortgage loans of the same type
as the Mortgage Loans for the Seller's own account or (y) the Designated
Guidelines were, at the time such Mortgage Loans were underwritten, designated
by the Seller on a consistent basis for use by lenders in originating mortgage
loans to be purchased by the Seller; and (iv) the Seller employed, at the time
such Mortgage Loans were acquired by the Seller, pre purchase or post purchase
quality assurance procedures (which may involve, among other things, review of a
sample of mortgage loans purchased during a particular time period or through
particular channels) designed to ensure that Persons from which it purchased
mortgage loans properly applied the underwriting criteria designated by the
Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in
the Custodial Account by the Seller in the month of substitution); (ii) have a
Mortgage Interest Rate not less than and not more than 1% greater than the
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one (1) year less than that of
the Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan
(i.e., fixed-rate, adjustable-rate with same Periodic Rate Cap, Index and lien
priority); and (v) comply with each representation and warranty (respecting
individual Mortgage Loans) set forth in Section 9 hereof.
Rating Agency: Any of Fitch, Xxxxx'x or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
Reconstitution Agreements: The agreement or agreements entered into by the
Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 13, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement, pooling and servicing
agreement and/or seller/servicer agreements and related custodial/trust
agreement and documents with respect to a Securitization Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100 229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have
been provided by the Commission in the adopting release (Asset Backed
Securities, Securities Act Release No. 33 8518, 70 Fed. Reg. 1,506, 1,531
(Jan. 7, 2005)) or by the staff of the Commission, or as may be provided by
the Commission or its staff from time to time.
REMIC: A "real estate mortgage investment conduit" within the meaning
of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating to 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 date specified in the Interim Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified
therein).
Repurchase Price: With respect to any Mortgage Loan for which a breach of
a representation or warranty from the Agreement or the Interim Servicing
Agreement is found, a price equal to the then outstanding principal balance of
the Mortgage Loan to be repurchased, plus accrued interest thereon at the
Mortgage Interest Rate from the date to which interest had last been paid
through the date of such repurchase, plus the amount of any outstanding advances
owed to any servicer, and plus all out of pocket costs and expenses incurred by
the Purchaser or any servicer arising out of or based upon such breach,
including without limitation costs and expenses incurred in the enforcement of
the Seller's repurchase obligation hereunder, and plus, in the event a Mortgage
Loan is repurchased during the first twelve (12) months following the related
Closing Date, an amount equal to the product of (i) an amount equal to (A) a
fraction, whose numerator is equal to 12 less the number of full calendar months
since the Closing Date and whose denominator is equal to 12, multiplied by (B)
the Premium Percentage, multiplied by (ii) the then outstanding principal
balance of the Mortgage Loan to be repurchased as of the date of such
repurchase.
RESPA: Real Estate Settlement Procedures Act, as amended from time to
time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage on
the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction. Any transaction involving either (1) a sale or
other transfer of some or all of the Mortgage Loans directly or indirectly to an
issuing entity in connection with an issuance of publicly offered or
privately-placed, rated or unrated mortgage backed securities or (2) an issuance
of publicly offered or privately placed, rated or unrated securities, the
payments on which are determined primarily by reference to one or more
portfolios of residential mortgage loans consisting, in whole or in part, of
some or all of the Mortgage Loans.
Seller: First Horizon Home Loan Corporation, a Kansas corporation, and its
successors in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to the Interim
Servicing Agreement, an amount equal to 0.50% per annum computed on the basis of
the outstanding principal balance of the related Mortgage Loan. Such fee shall
be payable monthly and shall be pro rated for any portion of a month during
which the Mortgage Loan is serviced by the Interim Servicer under the Interim
Servicing Agreement. The obligation of the Purchaser to pay the Servicing Fee is
limited to, and the Servicing Fee is payable solely from, the interest portion
(including recoveries with respect to interest from Liquidation Proceeds, to the
extent permitted by this Agreement) of such Monthly Payment collected by the
Interim Servicer, or as otherwise provided under this Agreement.
Servicing File: With respect to each Mortgage Loan, the file retained by
the Interim Servicer consisting of copies of the Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and all rights to
service the Mortgage Loans; (b) any payments to or monies received by the
Interim Servicer for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of the Interim
Servicer thereunder; (e) Escrow Payments or other similar payments with respect
to the Mortgage Loans and any amounts actually collected by the Interim Servicer
with respect thereto; (f) all accounts and other rights to payment related to
any of the property described in this paragraph; and (g) any and all documents,
files, records, servicing files, servicing documents, servicing records, data
tapes, computer records, or other information pertaining to the Mortgage Loans
or pertaining to the past, present or prospective servicing of the Mortgage
Loans.
Servicing Transfer Representation: Each representation set forth in
Subsections 9.01(t) and 9.02(b), (c), (d), (f), (h), the last sentence of (p),
(q), (r), (z), (hh), (ii), (kk), (ll), (mm), (qq), (xx), (bbb), (kkk), (ttt)(3)
and (ttt)(4).
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary, as
may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as described in Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans designated
by the Purchaser as being entitled to the benefits of the indemnifications set
forth in Sections 9.03 and 14.01.
Third Party Originator: Each Person, other than a Qualified Correspondent,
that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its designee, shall
receive the transfer of servicing responsibilities and begin to perform the
servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: The underwriting guidelines of the Seller, a copy
of which is attached hereto as Exhibit I and a then-current copy of which shall
be attached as an Exhibit to the related Assignment and Conveyance.
Whole Loan Transfer: Any sale or transfer of some or all of the Mortgage
Loans other than a Securitization Agreement.
SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser agrees to
purchase from time to time, Mortgage Loans having an aggregate principal balance
on the related Cut-off Date in an amount as set forth in the related Purchase
Price and Terms Agreement, or in such other amount as agreed by the Purchaser
and the Seller as evidenced by the actual aggregate principal balance of the
Mortgage Loans accepted by the Purchaser on each Closing Date.
SECTION 3. Mortgage Schedules.
The Seller from time to time shall provide in an electronic format the
Purchaser with certain information constituting a preliminary listing of the
Mortgage Loans to be purchased on each Closing Date in accordance with the
related Purchase Price and Terms Agreement and this Agreement (each, a
"Preliminary Mortgage Schedule").
The Seller shall deliver the Mortgage Loan Schedule for the Mortgage Loans
to be purchased on a particular Closing Date to the Purchaser at least two (2)
Business Days prior to the related Closing Date. The Mortgage Loan Schedule
shall be the related Preliminary Mortgage Schedule with those Mortgage Loans
which the Seller has not funded prior to the related Closing Date deleted.
SECTION 4. Purchase Price.
The Purchase Price for the Mortgage Loans shall be equal to (a) the
Purchase Price Percentage multiplied by the Cut-off Date Balance, plus (b)
accrued and unpaid interest on such principal balance at the weighted average
Mortgage Interest Rate (net of the Servicing Fee) of those Mortgage Loans from
the related Cut-off Date through the day prior to the related Closing Date,
inclusive. For purposes hereof, "Cut-off Date Balance" means the aggregate
principal balance, as of the related Cut-off Date, of the Mortgage Loans listed
on the related Mortgage Loan Schedule, after application of payments of
principal due on or before the related Cut-off Date, to the extent such payments
were actually received, together with any unscheduled principal payments
collected prior to the Cut-off Date; provided, however, that payments of
scheduled principal and interest paid prior to the Cut-off Date, but to be
applied on a due date beyond the related Cut-off Date, shall not be applied to
the principal balance as of the related Cut-off Date. If so provided in the
related Purchase Price and Terms Agreement, portions of the Mortgage Loans shall
be priced separately. The Purchase Price as so determined shall be paid to the
Seller on the related Closing Date by wire transfer of immediately available
funds to an account designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, 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, to the extent actually collected, together with any
unscheduled principal prepayments collected prior to the Cut-off Date; provided,
however, that payments of scheduled principal and interest paid prior to the
Cut-off Date, but to be applied on 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 Seller 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
Seller to the Purchaser.
SECTION 5. Examination of Mortgage Files.
At least seven (7) Business Days prior to the related Closing Date, the
Seller shall (i) either (a) deliver to the Purchaser or its designee in escrow,
for examination with respect to each Mortgage Loan to be purchased, the related
Mortgage File, including a copy of the Assignment of Mortgage (except with
respect to each MERS Designated Mortgage Loan), pertaining to each Mortgage
Loan, or (b) make the related Mortgage File available to the Purchaser for
examination at such other location as shall otherwise be acceptable to the
Purchaser and (ii) deliver to the Purchaser in an electronic format copies of
the credit and servicing files (collectively, the "Credit Files"). Such
examination of the Mortgage Files may be made by the Purchaser or its designee
at any reasonable time before or after the related Closing Date. If the
Purchaser makes such examination prior to the related Closing Date and
determines, in its sole discretion, that any Mortgage Loans are unacceptable to
the Purchaser for any reason, such Mortgage Loans shall be deleted from the
related Mortgage Loan Schedule, and may be replaced by a Qualified Substitute
Mortgage Loan (or Loans) acceptable to the Purchaser. The Purchaser may, at its
option and without notice to the Seller, purchase some or all of the Mortgage
Loans without conducting any partial or complete examination. The fact that the
Purchaser or its designee has conducted or has failed to conduct any partial or
complete examination of the Mortgage Files or the Credit Files shall not impair
in any way the Purchaser's (or any of its successor's) rights to demand
repurchase, substitution or other remedy as provided in this Agreement. In the
event that the Seller fails to deliver the Credit Files with respect to any
Mortgage Loan, the Seller shall, upon the request of the Purchaser, repurchase
such Mortgage Loan at the price and in the manner specified in Subsection 9.03.
SECTION 6. Conveyance from Seller to Purchaser.
Subsection 6.01 Conveyance of Mortgage Loans; Possession of Servicing
Files.
The Seller, simultaneously with the delivery of the Mortgage Loan Schedule
with respect to the related Mortgage Loan Package to be purchased on each
Closing Date, shall execute and deliver an Assignment and Conveyance Agreement
in the form attached hereto as Exhibit H (the "Assignment and Conveyance
Agreement"). The Seller shall cause the Servicing File retained by the Interim
Servicer pursuant to this Agreement to be appropriately identified in the
Seller's computer system and/or books and records, as appropriate, to clearly
reflect the sale of the related Mortgage Loan to the Purchaser. The Seller shall
cause the Interim Servicer to release from its custody the contents of any
Servicing File retained by it only in accordance with this Agreement or the
Interim Servicing Agreement, except when such release is required in connection
with a repurchase of any such Mortgage Loan pursuant to Subsection 9.03.
Subsection 6.02 Books and Records.
Record title to each Mortgage as of the related Closing Date shall be in
the name of the Seller, the Purchaser or one or more designees of the Purchaser,
as the Purchaser shall select. Notwithstanding the foregoing, each Mortgage and
related Mortgage Note shall be possessed solely by the Purchaser or the
appropriate designee of the Purchaser, as the case may be. All rights arising
out of the Mortgage Loans including, but not limited to, all funds received by
the Seller or the Interim Servicer after the related Cut-off Date on or in
connection with a Mortgage Loan shall be vested in the Purchaser or one or more
designees of the Purchaser; provided, however, that all funds received on or in
connection with a Mortgage Loan shall be received and held by the Seller or the
Interim Servicer in trust for the benefit of the Purchaser or the appropriate
designee of the Purchaser, as the case may be, as the owner of the Mortgage
Loans pursuant to the terms of this Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's balance
sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to be responsible for
maintaining, and shall maintain, a complete set of books and records for each
Mortgage Loan which shall be marked clearly to reflect the ownership of each
Mortgage Loan by the Purchaser. In particular, the Seller shall or shall cause
the Interim Servicer to maintain in its possession, available for inspection by
the Purchaser, and shall deliver to the Purchaser upon demand, evidence of
compliance with all applicable federal, state and local laws, rules and
regulations, including but not limited to documentation as to the method used in
determining the applicability of the provisions of the National Flood Insurance
Act of 1968, as amended, to the Mortgaged Property, documentation evidencing
insurance coverage and periodic inspection reports, as would be customarily
maintained by prudent sellers and servicers of Mortgage Loans similar to the
Mortgage Loans in the respective jurisdictions.
Subsection 6.03 Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later than seven
(7) Business Days prior to the related Closing Date those Mortgage Loan
Documents set forth on Exhibit A hereto with respect to each Mortgage Loan set
forth on the related Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian from and after the Closing Date.
The Seller shall or shall cause the Interim Servicer to forward to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
original documents evidencing an assumption, modification, consolidation or
extension of any Mortgage Loan entered into in accordance with this Agreement
within two (2) weeks of their execution, provided, however, that the Seller
shall provide the Custodian, or to such other Person as the Purchaser shall
designate in writing, with a certified true copy of any such document submitted
for recordation within two (2) weeks of its execution, and shall promptly
provide the original of any document submitted for recordation or a copy of such
document certified by the appropriate public recording office to be a true and
complete copy of the original within ninety (90) days of its submission for
recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within one hundred and eighty (180) days following
the Closing Date (other than with respect to the Assignments of Mortgage which
shall be delivered to the Custodian in blank and recorded subsequently by the
Purchaser or its designee), and in the event that the Seller does not cure such
failure within thirty (30) days of discovery or receipt of written notification
of such failure from the Purchaser, the related Mortgage Loan shall, upon the
request of the Purchaser, be repurchased by the Seller at the price and in the
manner specified in Subsection 9.03. The foregoing repurchase obligation shall
not apply in the event that the Seller cannot deliver such original or copy of
any document submitted for recordation to the appropriate public recording
office within the specified period due to a delay caused by the recording office
in the applicable jurisdiction, provided that (i) the Seller shall deliver a
recording receipt of such recording office or, if such recording receipt is not
available, a Seller certified copy of such document, confirming that such
documents have been accepted for recording, and (ii) such document is delivered
within twelve (12) months of the related Closing Date.
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee. The Purchaser or the Purchaser's designee
shall be responsible for recording the Assignments of Mortgage and shall be
reimbursed by the Seller for the costs associated therewith pursuant to the
preceding sentence.
Subsection 6.04 Quality Control Procedures.
The Seller shall, or shall cause the Interim Servicer to, have an internal
quality control program that verifies in a manner consistent with accepted
industry procedures, on a regular basis, the existence and accuracy of the legal
documents, credit documents, property appraisals, and underwriting decisions.
The program shall include evaluating and monitoring the overall quality of the
Seller's loan production and the servicing activities of the Interim Servicer.
The program is to ensure that the Mortgage Loans are originated and serviced in
accordance with Accepted Servicing Practices and the Underwriting Guidelines;
guard against dishonest, fraudulent, or negligent acts; and guard against errors
and omissions by officers, employees, or other authorized persons.
Subsection 6.05 MERS Designated Mortgage Loans.
With respect to each MERS Designated Mortgage Loan, the Seller shall, on
or prior to the related Closing Date, designate the Purchaser as the Investor,
and no Person shall be listed as Interim Funder on the MERS System. In addition,
on or prior to the related Closing Date, Seller shall provide the Custodian and
the Purchaser with a MERS Report listing the Purchaser as the Investor and no
Person as Interim Funder with respect to each MERS Designated Mortgage Loan.
SECTION 7. Servicing of the Mortgage Loans.
The Mortgage Loans have been sold by the Seller to the Purchaser on a
servicing released basis. Subject to, and upon the terms and conditions of this
Agreement and the Interim Servicing Agreement (with respect to each Mortgage
Loan, for an interim period, as specified therein), the Seller hereby sells,
transfers, assigns, conveys and delivers to the Purchaser the Servicing Rights.
The Purchaser shall retain the Interim Servicer as contract servicer of
the Mortgage Loans for an interim period pursuant to and in accordance with the
terms and conditions contained in the Interim Servicing Agreement (with respect
to each Mortgage Loan, for an interim period, as specified therein). Except as
set forth in the Interim Servicing Agreement, the Interim Servicer shall service
the Mortgage Loans on an "actual/actual" basis and otherwise in strict
compliance with the servicing provisions related to the Xxxxxx Xxx MBS Program
(Special Servicing Option) of the Xxxxxx Mae Guides (except as otherwise set
forth in the Interim Servicing Agreement). The Purchaser and Seller shall cause
the Interim Servicer to execute the Interim Servicing Agreement on the initial
Closing Date.
Pursuant to the Interim Servicing Agreement (with respect to each Mortgage
Loan, for an interim period, as specified therein), the Interim Servicer shall
begin servicing the Mortgage Loans on behalf of the Purchaser and shall be
entitled to a Servicing Fee with respect to such Mortgage Loans until the
applicable Transfer Date. The Interim Servicer shall conduct such servicing in
accordance with the Interim Servicing Agreement.
SECTION 8. Transfer of Servicing.
On the applicable Transfer Date, the Purchaser, or its designee, shall
assume all servicing responsibilities related to, and the Seller shall cause the
Interim Servicer to cease all servicing responsibilities related to, the related
Mortgage Loans subject to such Transfer Date. The Transfer Date shall be the
date determined in accordance with Section 6.02 of the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
On or prior to the applicable Transfer Date, the Seller shall, at its sole
cost and expense, take such steps as may be necessary or appropriate to
effectuate and evidence the transfer of the servicing of the related Mortgage
Loans to the Purchaser, or its designee, including but not limited to the
following:
(a) Notice to Mortgagors. The Seller shall cause the Interim Servicer to
mail to the Mortgagor of each related Mortgage Loan a letter advising such
Mortgagor of the transfer of the servicing of the related Mortgage Loan to the
Purchaser, or its designee, in accordance with the Xxxxxxxx Xxxxxxxx National
Affordable Housing Act of 1990; provided, however, the content and format of the
letter shall have the prior approval of the Purchaser. The Seller shall provide
the Purchaser with a form of such notices on or prior to the Transfer Date and
shall provide the Purchaser with an electronic file of all such notices within 5
Business Days of the Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The Seller shall
cause the Interim Servicer to transmit to the applicable taxing authorities and
insurance companies (including primary mortgage insurance policy insurers, if
applicable) and/or agents, notification of the transfer of the servicing to the
Purchaser, or its designee, and instructions to deliver all notices, tax bills
and insurance statements, as the case may be, to the Purchaser from and after
the Transfer Date. The Seller shall provide the Purchaser with a form of such
notices on or prior to the Transfer Date and shall provide the Purchaser with an
electronic file of all such notices no later than five (5) Business Days of the
Transfer Date.
(c) Delivery of Servicing Records. The Seller shall cause the Interim
Servicer to forward to the Purchaser, or its designee, in electronic format all
servicing records and the Servicing File in the Interim Servicer's possession
(which includes scanned copies of all documents in the Servicing File) relating
to each related Mortgage Loan including the information enumerated in the
Interim Servicing Agreement (with respect to each such Mortgage Loan, for an
interim period, as specified therein).
(d) Escrow Payments. The Seller shall cause the Interim Servicer to
provide the Purchaser, or its designee, with immediately available funds by wire
transfer in the amount of the net Escrow Payments and suspense balances and all
loss draft balances associated with the related Mortgage Loans. The Seller shall
cause the Interim Servicer to provide the Purchaser with an accounting
statement, in electronic format acceptable to the Purchaser in its sole
discretion, of Escrow Payments and suspense balances and loss draft balances
sufficient to enable the Purchaser to reconcile the amount of such payment with
the accounts of the Mortgage Loans. Additionally, the Seller shall cause the
Interim Servicer to wire transfer to the Purchaser the amount of any agency,
trustee or prepaid Mortgage Loan payments and all other similar amounts held by
the Interim Servicer.
(e) Payoffs and Assumptions. The Seller shall cause the Interim Servicer
to provide to the Purchaser, or its designee, copies of all assumption and
payoff statements generated by the Interim Servicer on the related Mortgage
Loans from the related Cut-off Date to the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Interim Servicer or the Seller on
each related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of any
related Monthly Payments received by the Seller after the Transfer Date shall be
forwarded to the Purchaser by overnight mail within 2 Business Days of the date
of receipt. The Seller shall notify the Purchaser of the particulars of the
payment, which notification requirement shall be satisfied if the Seller
forwards with its payment sufficient information to permit appropriate
processing of the payment by the Purchaser. The Seller shall assume full
responsibility for the necessary and appropriate legal application of such
Monthly Payments received by the Seller after the Transfer Date with respect to
related Mortgage Loans then in foreclosure or bankruptcy; provided, for purposes
of this Agreement, necessary and appropriate legal application of such Monthly
Payments shall include, but not be limited to, endorsement of a Monthly Payment
to the Purchaser with the particulars of the payment such as the account number,
dollar amount, date received and any special Mortgagor application instructions
and the Seller shall cause the Interim Servicer to comply with the foregoing
requirements with respect to all Monthly Payments received by the Interim
Servicer after the Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication errors;
(ii) The party receiving notice of a misapplied payment occurring prior to
the applicable Transfer Date and discovered after the Transfer Date shall
immediately notify the other party;
(iii) If a misapplied payment which occurred prior to the Transfer Date
cannot be identified and said misapplied payment has resulted in a shortage
in a Custodial Account or Escrow Account, the Seller shall be liable for the
amount of such shortage. The Seller shall reimburse the Purchaser for the
amount of such shortage within thirty (30) days after receipt of written
demand therefor from the Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer Date has
created an improper Purchase Price as the result of an inaccurate outstanding
principal balance, a check shall be issued to the party shorted by the
improper payment application within five (5) Business Days after notice
thereof by the other party; and
(v) Any check issued under the provisions of this Section 8(h) shall be
accompanied by a statement indicating the corresponding Seller and/or the
Purchaser Mortgage Loan identification number and an explanation of the
allocation of any such payments.
(i) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be in
accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on or before the Transfer Date,
reconcile principal balances and make any monetary adjustments required by the
Purchaser. Any such monetary adjustments will be transferred between the Seller
and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer to
file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 and all other forms
required to be filed which are required to be filed on or before the Transfer
Date in relation to the servicing and ownership of the related Mortgage Loans.
The Seller shall provide copies of such forms to the Purchaser upon request and
shall reimburse the Purchaser for any costs or penalties incurred by the
Purchaser due to the Seller's failure to comply with this paragraph.
SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 9.01 Representations and Warranties Regarding the Seller.
The Seller represents, warrants and covenants to the Purchaser that as of
the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller 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 on its business as now being
conducted and is licensed, qualified and in good standing in each state wherein
it owns or leases any material properties or where a Mortgaged Property is
located, if the applicable laws of such state require licensing or qualification
in order to conduct business of the type conducted by the Seller, and in any
event the Seller is in compliance with the laws of any such state to the extent
necessary to ensure the enforceability of the related Mortgage Loan and the
servicing of such Mortgage Loan in accordance with the terms of this Agreement
and the Interim Servicing Agreement; the Seller has the full corporate power,
authority and legal right to hold, transfer and convey the Mortgage Loans and to
execute and deliver this Agreement and to perform its obligations hereunder and
thereunder; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Seller and the consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized; this Agreement and all agreements
contemplated hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Seller, regardless of
whether such enforcement is sought in a proceeding in equity or at law; and all
requisite corporate or other action has been taken by the Seller to make this
Agreement and all agreements contemplated hereby valid and binding upon the
Seller in accordance with their terms;
(b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Seller, and the transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Seller pursuant to this Agreement are not subject to the
bulk transfer or any similar statutory provisions in effect in any applicable
jurisdiction;
(c) No Conflicts. Neither the execution and delivery of this Agreement,
the acquisition or origination of the Mortgage Loans by the Seller, the sale of
the Mortgage Loans to the Purchaser, the consummation of the transactions
contemplated hereby and thereby, nor the fulfillment of or compliance with the
terms and conditions of this Agreement, will conflict with or result in a breach
of any of the terms, conditions or provisions of the Seller's charter, by-laws
or other organizational documents or any legal restriction or any agreement or
instrument to which the Seller is now a party or by which it is bound, or
constitute a default or result in an acceleration under any of the foregoing, or
result in the violation of any law, rule, regulation, order, judgment or decree
to which the Seller or its property is subject, or result in the creation or
imposition of any lien, charge or encumbrance that would have an adverse effect
upon any of its properties pursuant to the terms of any mortgage, contract, deed
of trust or other instrument, or impair the ability of the Purchaser to realize
on the Mortgage Loans, impair the value of the Mortgage Loans, or impair the
ability of the Purchaser to realize the full amount of any insurance benefits
accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer 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 OTS, the OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller as Interim Servicer, acknowledges
and agrees that the Servicing Fee, represents reasonable compensation for
performing such services and that the entire Servicing Fee shall be treated by
the Interim Servicer, for accounting and tax purposes, as compensation for the
servicing and administration of the Mortgage Loans pursuant to this Agreement
and the Interim Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller does not believe, nor does it
have any reason or cause to believe, that it cannot perform each and every
covenant contained in this Agreement. The Seller is solvent and the sale of the
Mortgage Loans will not cause the Seller to become insolvent. The sale of the
Mortgage Loans is not undertaken with the intent to hinder, delay or defraud any
of Seller's creditors;
(g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or which, either in any one instance or in the
aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Seller contemplated herein, or which
would be likely to impair the ability of the Seller to perform under the terms
of this Agreement;
(h) No Consent Required. No consent, approval, authorization or order of,
or registration or filing with, or notice to any court or governmental agency or
body including HUD, the FHA or the Department of Veterans Affairs is required
for the execution, delivery and performance by the Seller of or compliance by
the Seller with this Agreement or the Mortgage Loans, the delivery of a portion
of the Mortgage Files to the Custodian or the sale of the Mortgage Loans or the
consummation of the transactions contemplated by this Agreement, or if required,
such approval has been obtained prior to the related Closing Date;
(i) Selection Process. The Mortgage Loans were selected from among the
outstanding one- to four-family mortgage loans in the Seller's portfolio at the
related Closing Date as to which the representations and warranties set forth in
Subsection 9.02 could be made and such selection was not made in a manner so as
to affect adversely the interests of the Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description of the pool
characteristics for the applicable Mortgage Loan Package delivered pursuant to
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any information,
statement, tape, diskette, report, form, or other document furnished or to be
furnished pursuant to this Agreement or any Reconstitution Agreement or in
connection with the transactions contemplated hereby (including any
Securitization Transaction or Whole Loan Transfer) contains or will contain any
untrue statement of fact or omits or will omit to state a fact necessary to make
the statements contained herein or therein not misleading;
(l) Financial Statements. The Seller has delivered to the Purchaser
financial statements as to its last three (3) complete fiscal years and any
later quarter ended more than sixty (60) days prior to the execution of this
Agreement. All such financial statements fairly present the pertinent results of
operations and changes in financial position for each of such periods and the
financial position at the end of each such period of the Seller and its
subsidiaries and have been prepared in accordance with generally accepted
accounting principles of the United States consistently applied throughout the
periods involved, except as set forth in the notes thereto. In addition, the
Seller has delivered information as to its loan gain and loss experience in
respect of foreclosures and its loan delinquency experience for the immediately
preceding three-year period, in each case with respect to mortgage loans owned
by it and mortgage loans serviced for others during such period, and all such
information so delivered shall be true and correct in all material respects to
the extent requested by the Purchaser and available to the Seller. There has
been no change in the business, operations, financial condition, properties or
assets of the Seller since the date of the Seller's financial statements that
would have an adverse effect on its ability to perform its obligations under
this Agreement. The Seller has completed any forms requested by the Purchaser in
a timely manner and in accordance with the provided instructions;
(m) No Brokers. The Seller has not dealt with any broker, investment
banker, agent or other person that may be entitled to any commission or
compensation in connection with the sale of the Mortgage Loans;
(n) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes;
(o) Reasonable Purchase Price. The consideration received by the Seller
upon the sale of the Mortgage Loans under this Agreement constitutes fair
consideration and reasonably equivalent value for the Mortgage Loans;
(p) Owner of Record. The Seller is the owner of record of each Mortgage
and the indebtedness evidenced by each Mortgage Note, and upon the sale of the
Mortgage Loans to the Purchaser, the Seller will retain the Mortgage Files with
respect thereto in trust only for the purpose of servicing and supervising the
servicing of each Mortgage Loan;
(q) Seller's Origination. The Seller's decision to originate any mortgage
loan or to deny any mortgage loan application is an independent decision based
upon Seller's underwriting guidelines, and is in no way made as a result of
Purchaser's decision to purchase, or not to purchase, or the price Purchaser may
offer to pay for, any such mortgage loan, if originated; and
(r) Compliance with Anti-Money Laundering Laws. The Seller has complied
with all applicable anti-money laundering laws, regulations and executive
orders, including without limitation the USA Patriot Act of 2001 (collectively,
the "Anti-Money Laundering Laws"); the Seller has established an anti-money
laundering compliance program as required by the Anti-Money Laundering Laws, has
conducted the requisite due diligence in connection with the origination of each
Mortgage Loan for purposes of the Anti-Money Laundering Laws, including with
respect to the legitimacy of the applicable Mortgagor and the origin of the
assets used by the said Mortgagor to purchase the property in question, and
maintains, and will maintain, sufficient information to identify the applicable
Mortgagor for purposes of the Anti-Money Laundering Laws;
(s) Delivery to the Custodian. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to this Agreement shall be delivered to
the Custodian all in compliance with the specific requirements of this
Agreement. With respect to each Mortgage Loan, the Seller will be in possession
of a complete Mortgage File in compliance with Exhibit A hereto, except for such
documents as will be delivered to the Custodian; and
(a) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan will fully furnish, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files to
Equifax, Experian and Trans Union Credit Information Company (three of the
credit repositories), on a monthly basis.
Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that, as to
each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the Mortgage
Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the Closing
Date under the terms of the Mortgage Note have been made and credited. As of the
Closing Date, no payment required under the Mortgage Loan is thirty (30) days or
more delinquent nor has any payment under the Mortgage Loan been thirty (30)
days or more delinquent at any time since the origination of the Mortgage Loan.
The first Monthly Payment after the Cut-off Date shall be made with respect to
the Mortgage Loan on its Due Date or within the grace period, all in accordance
with the terms of the related Mortgage Note;
(c) No Outstanding Charges. There are no defaults in complying with the
terms of the Mortgage securing the Mortgage Loan, 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 an escrow of funds has been established in an amount sufficient to pay for
every such item which remains unpaid and which has been assessed but is not yet
due and payable. Except for (A) payments in the nature of escrow payments and
(B) interest accruing from the date of the Mortgage Note or date of disbursement
of the Mortgage Loan proceeds, whichever is earlier to the day which precedes by
one (1) month the Due Date of the first installment of principal and interest,
including, without limitation, taxes and insurance payments, the Seller has not
advanced funds, or induced, solicited or knowingly received any advance of funds
by a party other than the Mortgagor, directly or indirectly, for the payment of
any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and Mortgage
have not been impaired, waived, altered or modified in any respect, from the
date of origination except by a written instrument which has been recorded, if
necessary to protect the interests of the Purchaser, and which has been
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. No
Mortgagor has been released, in whole or in part, except in connection with an
assumption agreement, approved by the title insurer, to the extent required by
the policy, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) No Defenses. The Mortgage Loan is 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 either the
Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject to
any right of rescission, set-off, counterclaim or defense, including without
limitation the defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all buildings
or other improvements upon the Mortgaged Property are insured by a generally
acceptable insurer against loss by fire, hazards of extended coverage and such
other hazards as are provided for in the Xxxxxx Xxx Guides or by Xxxxxxx Mac, as
well as all additional requirements set forth in Section 2.10 of the Interim
Servicing Agreement attached hereto as Exhibit B. If required by the National
Flood Insurance Act of 1968, as amended, each Mortgage Loan is covered by a
flood insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration in effect, which policy conforms to Xxxxxx Xxx
and Xxxxxxx Mac, as well as all additional requirements set forth in Section
2.10 of the Interim Servicing Agreement attached hereto as Exhibit B. All
individual insurance policies contain a standard mortgagee clause naming the
Seller and its successors and assigns as mortgagee, and all premiums thereon
have been paid and such policies may not be reduced, terminated or cancelled
without thirty (30) days' prior written notice to the mortgagee. The Mortgage
obligates the Mortgagor thereunder to maintain the hazard insurance policy at
the Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
such Mortgagor's cost and expense, and to seek reimbursement therefor from the
Mortgagor. Where required by state law or regulation, the Mortgagor has been
given an opportunity to choose the carrier of the required hazard insurance,
provided the policy is not a "master" or "blanket" hazard insurance policy
covering a condominium, or any hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy is the
valid and binding obligation of the insurer, is in full force and effect, and
will be in full force and effect and inure to the benefit of the Purchaser upon
the consummation of the transactions contemplated by this Agreement. The Seller
has not engaged in, and has no knowledge of the Mortgagor's or any servicer's
having engaged in, any act or omission which would impair the coverage of any
such policy, the benefits of the endorsement provided for herein, or the
validity and binding effect of such policy, including, without limitation, no
unlawful fee, commission, kickback or other unlawful compensation or value of
any kind has been or will be received, retained or realized by any attorney,
firm or other person or entity, and no such unlawful items have been received,
retained or realized by the Seller;
(g) Compliance with Applicable Laws. Any and all requirements of any
applicable federal, state or local law including, without limitation, usury,
truth-in-lending, real estate settlement procedures, consumer credit protection,
predatory, abusive and fair lending, equal credit opportunity and disclosure
laws, including, without limitation, any provisions relating to prepayment
penalties, have been complied with, the consummation of the transactions
contemplated hereby will not involve the violation of any such laws or
regulations, and the Seller shall maintain in its possession, available for the
Purchaser's inspection, and shall deliver to the Purchaser upon demand, evidence
of compliance with all such requirements. This representation is a Deemed
Material Breach Representation;
(h) No Satisfaction of Mortgage. The Mortgage has not been satisfied,
canceled, subordinated or rescinded, in whole or in part, and the Mortgaged
Property has not been released from the lien of the Mortgage, in whole or in
part, nor has any instrument been executed that would effect any such release,
cancellation, subordination or rescission. The Seller 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
Seller waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is a
fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a low-rise condominium project, or an individual
unit in a planned unit development and that no residence or dwelling is a mobile
home, provided, however, that any condominium unit or planned unit development
shall not fall within any of the "Ineligible Projects" of part XII, Section 102
of the Xxxxxx Mae Selling Guide and shall conform with the Underwriting
Guidelines. In the case of any Mortgaged Properties that are manufactured homes
(a "Manufactured Home Mortgage Loans"), (A) (i) such Manufactured Home Mortgage
Loan conforms with the applicable Xxxxxx Xxx or Xxxxxxx Mac requirements
regarding mortgage loans related to manufactured dwellings, (ii) the related
manufactured dwelling is permanently affixed to the land, (iii) the related
manufactured dwelling and the related land are subject to a Mortgage properly
filed in the appropriate public recording office and naming Seller as mortgagee,
(iv) the applicable laws of the jurisdiction in which the related Mortgaged
Property is located will deem the manufactured dwelling located on such
Mortgaged Property to be a part of the real property on which such dwelling is
located, (v) such Manufactured Home Mortgage Loan is (x) a qualified mortgage
under Section 860G(a)(3) of the Internal Revenue Code of 1986, as amended and
(y) secured by manufactured housing treated as a single family residence under
Section 25(e)(10) of the Code (i.e., such manufactured home has a minimum of 400
square feet of living space, a minimum width in excess of 102 inches and which
is of a kind customarily used at a fixed location) and (vi) as of the
origination date of the related Mortgage Loan, the related manufactured housing
unit that secures such Mortgage Loan either (x) was the principal residence of
the Mortgagor or (y) was classified as real property under applicable state law.
As of the date of origination, no portion of the Mortgaged Property was used for
commercial purposes, and since the date of origination, no portion of the
Mortgaged Property has been used for commercial purposes; provided, that
Mortgaged Properties which contain a home office shall not be considered as
being used for commercial purposes as long as the Mortgaged Property has not
been altered for commercial purposes and is not storing any chemicals or raw
materials other than those commonly used for homeowner repair, maintenance
and/or household purposes. This representation is a Deemed Material Breach
Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and subsisting
first lien, with respect to First Lien Loans, or second lien, with respect to
Second Lien Loans, of record on a single parcel of real estate constituting the
Mortgaged Property, including all buildings and improvements on the Mortgaged
Property and all installations and mechanical, electrical, plumbing, heating and
air conditioning systems located in or annexed to such buildings, and all
additions, alterations and replacements made at any time, subject in all cases
to the exceptions to title set forth in the title insurance policy with respect
to the related Mortgage Loan, which exceptions are generally acceptable to
prudent mortgage lending companies, and such other exceptions to which similar
properties are commonly subject and which do not individually, or in the
aggregate, materially and adversely affect the benefits of the security intended
to be provided by such Mortgage. In no event shall any Mortgage Loan be in a
lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of
recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b) which
do not adversely affect the Appraised Value of the Mortgaged
Property set forth in such appraisal; and
(4) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of the
security intended to be provided by the Mortgage or the use,
enjoyment, value or marketability of the related Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Seller has full right to sell and
assign the same to Purchaser;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage and
any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms (including, without limitation, any provisions therein
relating to prepayment penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage and
any other related agreement, and the Mortgage Note, the Mortgage and any other
such related agreement have been duly and properly executed by other such
related parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material fact
or omit to state a material fact required to be stated therein or necessary to
make the information and statements therein not misleading. No fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination or servicing of the Mortgage Loan. The Seller
has reviewed all of the documents constituting the Servicing File and has made
such inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed and
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 improvement and as to disbursements of any
escrow funds therefor have been complied with. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage were paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due under the Mortgage Note or Mortgage;
(m) Ownership. The Seller is the sole owner of record and holder of the
Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon the
sale of the Mortgage Loans to the Purchaser, the Seller will retain the Mortgage
Files or any part thereof with respect thereto not delivered to the Custodian,
the Purchaser or the Purchaser's designee, in trust only for the purpose of
servicing and supervising the servicing of each Mortgage Loan. The Mortgage Loan
is not assigned or pledged, and the Seller has good, indefeasible and marketable
title thereto, and has full right to transfer and sell the Mortgage Loan to the
Purchaser free and clear of any encumbrance, equity, participation interest,
lien, pledge, charge, claim or security interest, and has full right and
authority subject to no interest or participation of, or agreement with, any
other party, to sell and assign each Mortgage Loan pursuant to this Agreement
and following the sale of each 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 Seller intends to
relinquish all rights to possess, control and monitor the Mortgage Loan. After
the Closing Date, the Seller will have no right to modify or alter the terms of
the sale of the Mortgage Loan and the Seller will have no obligation or right to
repurchase the Mortgage Loan or substitute another Mortgage Loan, except as
provided in this Agreement;
(n) Doing Business. All parties which have had any interest in the
Mortgage Loan, whether as mortgagee, assignee, pledgee or otherwise, are (or,
during the period in which they held and disposed of such interest, were) (1) in
compliance with any and all applicable licensing requirements of the laws of the
state wherein the Mortgaged Property is located, and (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state to
the extent required by applicable law to do business in such state, or (iii) a
federal savings and loan association, a savings bank or a national bank having a
principal office in such state, or (3) not doing business in such state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien Loan has
a CLTV in excess of 100%. No Mortgage Loan has an LTV greater than 100%. At
origination of the Mortgage Loan, the Mortgagor did not have a FICO score of
less than 500;
(p) Title Insurance. The 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 Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and qualified
to do business in the jurisdiction where the Mortgaged Property is located,
insuring the Seller, its successors and assigns, as to the first priority lien
(with respect to First Lien Loans) or second priority lien (with respect to
Second Lien Loans) of the Mortgage in the original principal amount of the
Mortgage Loan, subject only to the exceptions contained in clauses (1) and (2)
of paragraph (j) of this Subsection 9.02, and in the case of Adjustable Rate
Mortgage Loans, against any loss by reason of the invalidity or unenforceability
of the lien resulting from the provisions of the Mortgage providing for
adjustment to 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. Additionally, such
lender's title insurance policy affirmatively insures ingress and egress, and
against encroachments by or upon the Mortgaged Property or any interest therein.
The title policy does not contain any special exceptions (other than the
standard exclusions) for zoning and uses and has been marked to delete the
standard survey exception or to replace the standard survey exception with a
specific survey reading. The Seller, its successor and assigns, are the sole
insureds of such lender's title insurance policy, and such lender's title
insurance policy is valid and remains in full force and effect and will be in
force and effect upon the consummation of the transactions contemplated by this
Agreement. No claims have been made under such lender's title insurance policy,
and no prior holder of the related Mortgage, including the Seller, has done, by
act or omission, anything which would impair the coverage of such lender's title
insurance policy, including without limitation, no unlawful fee, commission,
kickback or other unlawful compensation or value of any kind has been or will be
received, retained or realized by any attorney, firm or other person or entity,
and no such unlawful items have been received, retained or realized by the
Seller;
(q) No Defaults. There is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage Note and
no event which, with the passage of time or with notice and the expiration of
any grace or cure period, would constitute a default, breach, violation or event
which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note, (iii) there is no event which, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the Second Lien Loan to
receive notice of, and affords such mortgagee an opportunity to cure any default
by payment in full or otherwise under the prior mortgage;
(r) No Mechanics' Liens. 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 the law could give rise to such liens) affecting the
related Mortgaged Property which are or may be liens prior to, or equal or
coordinate with, the lien of the related Mortgage;
(s) Location of Improvements; No Encroachments. All improvements which
were considered in determining the Appraised Value of the Mortgaged Property lay
wholly within the boundaries and building restriction lines of the Mortgaged
Property, and no improvements on adjoining properties encroach upon the
Mortgaged Property. The Mortgaged Property and all improvements located on or
being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
(t) Origination; Payment Terms. 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 Act, a savings and loan association, a savings bank,
a commercial bank, credit union, insurance company or other similar institution
which is supervised and examined by a federal or state authority. The documents,
instruments and agreements submitted for loan underwriting were not falsified
and contain no untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the information and
statements therein not misleading. No Mortgage Loan contains terms or provisions
which would result in negative amortization. Unless otherwise noted on the
Mortgage Loan Schedule, principal payments on the Mortgage Loan commenced no
more than sixty (60) days after funds were disbursed in connection with the
Mortgage Loan. The Mortgage Interest Rate as well as, with respect to Adjustable
Rate Mortgage Loans, the Lifetime Rate Cap, the Periodic Rate Floor and the
Periodic Rate Cap are as set forth on Exhibit B to each related Assignment and
Conveyance Agreement. The Mortgage Interest Rate is adjusted, with respect to
Adjustable Rate Mortgage Loans, on each Interest Rate Adjustment Date to equal
the Index plus the Gross Margin (rounded up or down to the nearest 0.125%),
subject to the Periodic Rate Cap. Unless specified on the related Mortgage Loan
Schedule as an interest-only loan, the Mortgage Note is payable in equal monthly
installments of principal and interest, which installments of interest, with
respect to Adjustable Rate Mortgage Loans, are subject to change due to the
adjustments to the Mortgage Interest Rate on each Interest Rate Adjustment Date,
with interest calculated and payable in arrears, sufficient to amortize the
Mortgage Loan fully by the stated maturity date (unless the Mortgage Loan is
identified on the Mortgage Loan Schedule as a Balloon Mortgage Loan), over an
original term of not more than thirty (30) years from commencement of
amortization. Unless otherwise specified on the description of pool
characteristics for the applicable Mortgage Loan Package delivered pursuant to
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement, the Mortgage Loan is payable on the
first day of each month. There are no Convertible Mortgage Loans which contain a
provision allowing the Mortgagor to convert the Mortgage Note from an adjustable
interest rate Mortgage Note to a fixed interest rate Mortgage Note. Unless
otherwise noted on the Mortgage Loan Schedule, the Due Date of the first payment
under the Mortgage Note is no more than sixty (60) days from the date of the
Mortgage Note;
(u) Customary Provisions. The 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, (i) in the case of a Mortgage
designated as a deed of trust, by trustee's sale, and (ii) otherwise by judicial
foreclosure. Upon default by a Mortgagor on a Mortgage Loan and foreclosure on,
or trustee's sale of, the Mortgaged Property pursuant to the proper procedures,
the holder of the Mortgage Loan will be able to deliver good and merchantable
title to the Mortgaged Property. There is no homestead or other exemption
available to a Mortgagor which would interfere with the right to sell the
Mortgaged Property at a trustee's sale or the right to foreclose the Mortgage,
subject to applicable federal and state laws and judicial precedent with respect
to bankruptcy and right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The Mortgage Loan
was underwritten in accordance with the Underwriting Guidelines (a copy of which
is attached to the related Assignment and Conveyance Agreement as Exhibit C).
The Mortgage Note and Mortgage are on forms acceptable to Xxxxxxx Mac or Xxxxxx
Mae and no representations have been made to a Mortgagor that are inconsistent
with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date the
Mortgaged Property is lawfully occupied under applicable law. All inspections,
licenses and certificates required to be made or issued with respect to all
occupied portions of the Mortgaged Property and, with respect to the use and
occupancy of the same, including but not limited to certificates of occupancy
and fire underwriting certificates, have been made or obtained from the
appropriate authorities. The Seller has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Seller has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. Unless otherwise noted on the Mortgage Loan Schedule, the Mortgagor
represented at the time of origination of the Mortgage Loan that the Mortgagor
would occupy the Mortgaged Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The 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 in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of trust,
a trustee, authorized and duly qualified under applicable law to serve as such,
has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. To the knowledge of the Seller, there are no
circumstances or conditions with respect to the Mortgage, the Mortgaged
Property, the Mortgagor, the Mortgage File or the Mortgagor's credit standing
that can reasonably be expected to cause private institutional investors to
regard the Mortgage Loan as an unacceptable investment, cause the Mortgage Loan
to become delinquent, or adversely affect the value or marketability of the
Mortgage Loan, or cause the Mortgage Loan to prepay during any period materially
faster or slower than the mortgage loans originated by the Seller generally;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered under
this Agreement for each Mortgage Loan have been delivered to the Custodian. The
Seller is in possession of a complete, true and accurate Mortgage File in
compliance with Exhibit A hereto, except for such documents the originals of
which have been delivered to the Custodian, and the Seller has retained copies
thereof;
(bb) Condominiums/Planned Unit Developments. If the Mortgaged Property is
a condominium unit or a planned unit development (other than a de minimis
planned unit development) such condominium or planned unit development project
is (i) acceptable to Xxxxxx Xxx or Xxxxxxx Mac or (ii) located in a condominium
or planned unit development project which has received project approval from
Xxxxxx Mae or Xxxxxxx Mac. The representations and warranties required by Xxxxxx
Mae with respect to such condominium or planned unit development have been
satisfied and remain true and correct;
(cc) Transfer of Mortgage Loans. Except with respect to MERS Designated
Mortgage Loans, the Assignment of Mortgage with respect to each Mortgage Loan is
in recordable form and is acceptable for recording under the laws of the
jurisdiction in which the Mortgaged Property is located. The transfer,
assignment and conveyance of the Mortgage Notes and the Mortgages by the Seller
are not subject to the bulk transfer or similar statutory provisions in effect
in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder, and to the best of the Seller's knowledge, such
provision is enforceable;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent Interests.
The Mortgage Loan does not contain provisions pursuant to which Monthly Payments
are paid or partially paid with funds deposited in any separate account
established by the Seller, the Mortgagor, or anyone on behalf of the Mortgagor,
or paid by any source other than the Mortgagor nor does it contain any other
similar provisions which may constitute a "buydown" provision. The Mortgage Loan
is not a graduated payment mortgage loan, and the Mortgage Loan does not have a
shared appreciation or other contingent interest feature. The indebtedness
evidenced by the Mortgage Note is not convertible to an ownership interest in
the Mortgaged Property or the Mortgagor and the Seller has not financed nor does
it own directly or indirectly, any equity of any form in the Mortgaged Property
or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the applicable Cut-off Date have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured principal
amount, as consolidated, bears a single interest rate and single repayment term.
The lien of the Mortgage securing the consolidated principal amount is expressly
insured as having first or second, as applicable, lien priority by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to Xxxxxx Xxx and
Xxxxxxx Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. There is
no proceeding pending or threatened for the total or partial condemnation of the
Mortgaged Property. The Mortgaged Property is undamaged by waste, fire,
earthquake or earth movement, windstorm, flood, tornado or other casualty so as
to affect adversely the value of the Mortgaged Property as security for the
Mortgage Loan or the use for which the premises were intended and each Mortgaged
Property is in good repair. There have not been any condemnation proceedings
with respect to the Mortgaged Property and the Seller has no knowledge of any
such proceedings in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments. The
origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of Seller
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. Each Mortgage Loan is
covered by a paid in full, life of loan, tax service contract that has been
assigned without penalty, premium or cost to the Purchaser. All Escrow Payments
have been collected in full compliance with state and federal law and the
provisions of the related Mortgage Note and Mortgage. An escrow of funds is not
prohibited by applicable law and has been established in an amount sufficient to
pay for every item that remains unpaid and has been assessed but is not yet due
and payable. No escrow deposits or Escrow Payments or other charges or payments
due the Seller have been capitalized under the Mortgage or the Mortgage Note.
All Mortgage Interest Rate adjustments have been made in strict compliance with
state and federal law and the terms of the related Mortgage and Mortgage Note on
the related Interest Rate Adjustment Date. If, pursuant to the terms of the
Mortgage Note, another index was selected for determining the Mortgage Interest
Rate, the same index was used with respect to each Mortgage Note which required
a new index to be selected, and such selection did not conflict with the terms
of the related Mortgage Note. Any and all notices required under applicable law
and the terms of the related Mortgage Note and Mortgage regarding the Mortgage
Interest Rate and the Monthly Payment adjustments have been delivered. Any
interest required to be paid pursuant to state, federal and local law has been
properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan has the characteristics
set forth on Exhibit B to the related Assignment and Conveyance Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action, inaction
or event has occurred and no state of facts exists or has existed on or prior to
the Closing Date that has resulted or will result in the exclusion from, denial
of, or defense to coverage under any applicable primary mortgage insurance
policy, hazard insurance policy or bankruptcy bond (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), irrespective of the cause of such failure of
coverage. The Seller has caused or will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser. In connection with the placement of any such
insurance, no commission, fee, or other compensation has been or will be
received by the Seller or by any officer, director, or employee of the Seller or
any designee of the Seller or any corporation in which the Seller or any
officer, director, or employee had a financial interest at the time of placement
of such insurance;
(ll) No Violation of Environmental Laws. The Mortgaged Property is free
from any and all toxic or hazardous substances and there exists no violation of
any local, state or federal environmental law, rule or regulation. 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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not notified the
Seller, and the Seller has no knowledge of any relief requested or allowed to
the Mortgagor under the Servicemembers' Civil Relief Act of 1940, as amended, or
any similar state statute;
(nn) Appraisal. The Seller has delivered to the Purchaser an appraisal of
the Mortgaged Property signed prior to the approval of the Mortgage application
by an appraiser qualified under Xxxxxx Xxx and Xxxxxxx Mac guidelines who (i) is
licensed in the state where the Mortgaged Property is located, (ii) has no
interest, direct or indirect, in the Mortgaged Property or in any Loan or the
security therefor, and (iii) does not receive compensation that is affected by
the approval or disapproval of the Mortgage Loan. The appraisal shall have been
made within one hundred eighty (180) days of the origination of the Mortgage
Loan and shall be completed in compliance with the Uniform Standards of
Professional Appraisal Practice, and all applicable Federal and state laws and
regulations. If the appraisal was made more than one hundred twenty (120) days
before the origination of the Mortgage Loan, the Seller shall have received and
delivered to the Purchaser a recertification of the appraisal;
(oo) Disclosure Materials. The Mortgagor has, to the extent required by
applicable law, executed a statement to the effect that the Mortgagor has,
received all disclosure materials required by applicable law and the Seller has
complied with all applicable law with respect to the making of the Mortgage
Loans. The Seller shall cause the Interim Servicer to maintain such statement in
the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. The Mortgage
Loan was not made in connection with the construction or rehabilitation of a
Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) No Defense to Insurance Coverage. No action has been taken or failed
to be taken, no event has occurred and no state of facts exists or has existed
on or prior to the Closing Date (whether or not known to the Seller on or prior
to such date) which has resulted or will result in an exclusion from, denial of,
or defense to coverage under any primary mortgage insurance (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 Seller, the related Mortgagor or
any party involved in the application for such coverage, including the
appraisal, plans and specifications and other exhibits or documents submitted
therewith to the insurer under such insurance policy, or for any other reason
under such coverage, but not including the failure of such insurer to pay by
reason of such insurer's breach of such insurance policy or such insurer's
financial inability to pay. In connection with the placement of any such
insurance, no commission, fee, or other compensation has been or will be
received by the Seller or any designee of the Seller or any corporation in which
the Seller or any officer, director, or employee had a financial interest at the
time of placement of such insurance;
(rr) Qualified Mortgage. The Mortgage Loan is a qualified mortgage under
Section 860G(a)(3) of the Code;
(ss) Credit Information. As to each consumer report (as defined in the
Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Seller to the Purchaser, that Seller has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Seller has in its capacity as
servicer, for each Mortgage Loan, fully furnished, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files to
Equifax, Experian and Trans Union Credit Information Company (three of the
credit repositories), on a monthly basis. This representation is a Deemed
Material Breach Representation;
(tt) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate, the assignment of the lease without the lessor's consent and
the acquisition by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder of the
Mortgage with substantially similar protections; (3) the terms of such lease do
not (a) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than fifteen (15) years; (5) the term of such lease does not terminate
earlier than five (5) years after the maturity date of the Mortgage Note; and
(6) the Mortgaged Property is located in a jurisdiction in which the use of
leasehold estates in transferring ownership in residential properties is a
widely accepted practice;
(uu) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on Exhibit
B to each related Assignment and Conveyance Agreement. With respect to each
Mortgage Loan that has a prepayment penalty feature, each such prepayment
penalty is enforceable and will be enforced by the Seller for the benefit of the
Purchaser, and each prepayment penalty is permitted pursuant to applicable
federal, state and local law. Each such prepayment penalty is in an amount equal
to the maximum amount permitted under applicable law and no such prepayment
penalty may provide for a term in excess of five (5) years with respect to
Mortgage Loans originated prior to October, 1, 2002. With respect to Mortgage
Loans originated on or after October 1, 2002, the duration of the prepayment
period shall not exceed three (3) years from the date of the Mortgage Note
unless the Mortgage Loan was modified to reduce the prepayment period to no more
than three (3) years from the date of such Mortgage Note and the Mortgagor was
notified in writing of such reduction in prepayment period. With respect to any
Mortgage Loan that contains a provision permitting imposition of a prepayment
penalty upon a prepayment prior to maturity: (i) the Mortgage Loan provides some
benefit to the Mortgagor (e.g., a rate or fee reduction) in exchange for
accepting such prepayment penalty, (ii) prior to the Mortgage Loan origination,
the Mortgagor was offered the option of obtaining a mortgage loan that did not
require payment of such a penalty and (iii) the prepayment penalty was
adequately disclosed to the Mortgagor in the loan documents pursuant to
applicable state, local and federal law. This representation is a Deemed
Material Breach Representation;
(vv) Assumability. With respect to each Adjustable Rate Mortgage Loan, the
Mortgage Loan Documents provide that after the related first Interest Rate
Adjustment Date, a related Mortgage Loan may only be assumed if the party
assuming such Mortgage Loan meets certain credit requirements stated in the
Mortgage Loan Documents;
(ww) Conversion to Fixed Interest Rate. With respect to Adjustable Rate
Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(xx) Escrow Analysis. With respect to each Mortgage, the Seller has within
the last twelve (12) months (unless such Mortgage was originated within such
twelve month period) analyzed the required Escrow Payments for each Mortgage and
adjusted the amount of such payments so that, assuming all required payments are
timely made, any deficiency will be eliminated on or before the first
anniversary of such analysis, or any overage will be refunded to the Mortgagor,
in accordance with RESPA and any other applicable law;
(yy) Predatory Lending Regulations. No Mortgage Loan is a High Cost Loan
or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any applicable comparable state
or local law. The Mortgaged Property is not located in a jurisdiction where a
breach of this representation with respect to the related Mortgage Loan may
result in additional assignee liability to the Purchaser, as determined by
Purchaser in its reasonable discretion, as set forth on Exhibit G, as may be
changed from time to time upon 10 days prior notice from Buyer to Seller. This
representation is a Deemed Material Breach Representation;
(zz) Single Premium Credit Life Insurance Policy. No Mortgagor was
required to purchase any single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property insurance policy) or debt
cancellation agreement as a condition of obtaining the extension of credit. No
Mortgagor obtained a prepaid single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property 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 or debt
cancellation agreements as part of the origination of, or as a condition to
closing, such Mortgage Loan. This representation is a Deemed Material Breach
Representation;
(aaa) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or trustees for an Illinois land trust or a trustee under a "living
trust" and such "living trust" is in compliance with Xxxxxx Xxx guidelines for
such trusts;
(bbb) Insurance. The Seller has caused or will cause to be performed any
and all acts required to preserve the rights and remedies of the Purchaser in
any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser;
(ccc) Simple Interest Mortgage Loans. The Mortgage Loan is not a simple
interest Mortgage Loan;
(ddd) Flood Certification Contract. The Mortgage Loan is covered by a paid
in full, life of loan, transferable flood certification contract that has been
assigned without penalty, cost or premium to the Purchaser;
(eee) Consent. Either (a) no consent for the Second Lien Loan is required
by the holder of the related first lien or (b) such consent has been obtained
and is contained in the Mortgage File;
(fff) Origination Date. Unless otherwise noted on the related Mortgage
Loan Schedule, the date of origination of the Mortgage Loan shall be no earlier
than three (3) months prior to the date such Mortgage Loan is first purchased by
the Purchaser unless agreed in writing by Purchaser in its sole discretion;
(ggg) No Exception. The Custodian has not noted any material exceptions on
an Exception Report (as defined in the Custodial Agreement) with respect to the
Mortgage Loan which would materially adversely affect the Mortgage Loan or the
Purchaser's ownership of the Mortgage Loan, unless consented to by the
Purchaser;
(hhh) Mortgage Submitted for Recordation. The Mortgage either has been or
will promptly be submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located;
(iii) Endorsements. The Mortgage Note has been endorsed by Seller for its
own account and not as a fiduciary, trustee, trustor or beneficiary under a
trust agreement;
(jjj) Accuracy of Information. All information provided to the Purchaser
by the Seller with respect to the Mortgage Loan is accurate in all material
respects;
(kkk) Mortgagor Bankruptcy. On or prior to the date thirty (30) days after
the related Closing Date, the Mortgagor has not filed or will not file a
bankruptcy petition or has not become the subject or will not become the subject
of involuntary bankruptcy proceedings or has not consented to or will not
consent to the filing of a bankruptcy proceeding against it or to a receiver
being appointed in respect of the related Mortgaged Property;
(lll) No Construction Loans. No Mortgage Loan was made in connection with
(a) facilitating the trade-in or exchange of a Mortgaged Property or (b) the
construction or rehabilitation of a Mortgaged Property, unless the Mortgage Loan
is a construction-to-permanent mortgage loan listed on the Mortgage Loan
Schedule which has been fully disbursed, all construction work is complete and a
completion certificate has been issued;
(mmm) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Seller has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor;
(nnn) Proceeds of Mortgage Loan. The proceeds of the Mortgage Loan have
not been and shall not be used to satisfy, in whole or in part, any debt owed or
owing by the Mortgagor to Seller or any Affiliate or correspondent thereof
unless such debt was originated more than twenty-four (24) months prior to the
origination of such Mortgage Loan;
(ooo) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction. This representation is a Deemed Material Breach Representation;
(ppp) Origination Practices/No Steering. The Mortgagor was not encouraged
or required to select a Mortgage Loan product offered by the Mortgage Loan's
originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account such facts as, without limitation, the
Mortgage Loan's requirements and the Mortgagor's credit history, income, assets
and liabilities 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 Mortgagor 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 Mortgagor's application to such affiliate for underwriting
consideration. For a Mortgagor who seeks financing through a Mortgage Loan
originator's higher-priced subprime lending channel, the Mortgagor was directed
towards or offered the Mortgage Loan originator's standard mortgage line if the
Mortgagor was able to qualify for one of the standard products. This
representation is a Deemed Material Breach Representation;
(qqq) Underwriting Methodology. The methodology used in underwriting the
extension of credit for each Mortgage Loan does not rely solely on the extent of
the Mortgagor's equity in the collateral as the principal determining factor in
approving such extension of credit. The methodology employed objective criteria
such as the Mortgagor's income, assets and liabilities, to the proposed mortgage
payment and, based on such methodology, the Mortgage Loan's originator made a
reasonable determination that at the time of origination the Mortgagor had the
ability to make timely payments on the Mortgage Loan. Such underwriting
methodology confirmed that at the time of origination (application/approval) the
Mortgagor had a reasonable ability to make timely payments on the Mortgage Loan.
This representation is a Deemed Material Breach Representation;
(rrr) Points and Fees. No Mortgagor was charged "points and fees" (whether
or not financed) in an amount greater than (i) $1,000, or (ii) 5% of the
principal amount of such Mortgage Loan, whichever is greater. For purposes of
this representation, such 5% limitation is calculated in accordance with Xxxxxx
Mae's anti-predatory lending requirements as set forth in the Xxxxxx Xxx Guides
and "points and fees" (x) include origination, underwriting, broker and finder
fees and charges that the mortgagee imposed as a condition of making the
Mortgage Loan, whether they are paid to the mortgagee or a third party; and (y)
exclude bona fide discount points, fees paid for actual services rendered in
connection with the origination of the Mortgage Loan (such as attorneys' fees,
notaries fees and fees paid for property appraisals, credit reports, surveys,
title examinations and extracts, flood and tax certifications, and home
inspections), the cost of mortgage insurance or credit-risk price adjustments,
the costs of title, hazard, and flood insurance policies, state and local
transfer taxes or fees, escrow deposits for the future payment of taxes and
insurance premiums, and other miscellaneous fees and charges which miscellaneous
fees and charges, in total, do not exceed 0.25% of the principal amount of such
Mortgage Loan. This representation and warranty is a Deemed Breach
Representation;
(sss) Fees Charges. All fees and charges (including finance charges) and
whether or not financed, assessed, collected or to be collected in connection
with the origination and servicing of each Mortgage Loan has been disclosed in
writing to the Mortgagor in accordance with applicable state and federal law and
regulation. This representation is a Deemed Material Breach Representation; and
(ttt) Second Lien Mortgage Loans. With respect to each Second Lien Loan:
(1) the related First Lien Loan does not permit negative amortization; (2) where
required or customary in the jurisdiction in which the Mortgaged Property is
located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) to the best of Seller's
knowledge, the related First Lien Loan is in full force and effect, and there is
no default, lien, breach, violation or event which would permit acceleration
existing under such First Lien Loan or 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 which would
permit acceleration under such First Lien Loan; (4) the related first lien
Mortgage contains a provision which provides for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such mortgagee to
cure any default under the related first lien Mortgage; and (5) the related
Mortgaged Property is the Mortgagor's principal residence. This representation
is a Deemed Material Breach Representation.
Subsection 9.03 Remedies for Breach of Representations and Warranties.
It is understood and agreed that the representations and warranties set
forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage Loans
to the Purchaser and shall inure to the benefit of the Purchaser,
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
Assignment of Mortgage or the examination or failure to examine any Mortgage
File. Upon discovery by either the Seller or the Purchaser of a breach of any of
the foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other.
Within sixty (60) days of the earlier of either discovery by or notice to
the Seller of any breach of a representation or warranty which materially and
adversely affects the value of the Mortgage Loans or the interest of the
Purchaser therein (or which materially and adversely affects the value of the
applicable Mortgage Loan or the interest of the Purchaser therein in the case of
a representation and warranty relating to a particular Mortgage Loan), the
Seller shall use its best efforts promptly to cure such breach in all material
respects and, if such breach cannot be cured, the Seller shall, at the
Purchaser's option, repurchase such Mortgage Loan at the Repurchase Price,
together with all expenses incurred by the Purchaser as a result of such
repurchase. Notwithstanding the above sentence, (i) within sixty (60) days of
the earlier of either discovery by, or notice to, the Seller of any breach of
the representation or warranty set forth in clause (rr) of Subsection 9.02, the
Seller shall repurchase such Mortgage Loan at the Repurchase Price, together
with all out-of-pocket expenses incurred by the Purchaser as a result of such
repurchase and (ii) any breach of a Deemed Material Breach Representation shall
automatically be deemed to materially and adversely affect the value of the
Mortgage Loan and the interest of the Purchaser therein. In the event that a
breach shall involve any representation or warranty set forth in Subsection
9.01, and (except as provided in the preceding sentence with respect to certain
breaches for which no cure is permitted) such breach cannot be cured within
sixty (60) days of the earlier of either discovery by or notice to the Seller of
such breach, all of the Mortgage Loans shall, at the Purchaser's option, be
repurchased by the Seller at the Repurchase Price, together with all expenses
incurred by the Purchaser as a result of such repurchase. However, if the breach
shall involve a representation or warranty set forth in Subsection 9.02 (other
than the representations and warranties set forth in clause (rr) of such
Subsection or any Deemed Material Breach Representation) and the Seller
discovers or receives notice of any such breach within one hundred twenty (120)
days of the related Closing Date, the Seller shall, at the Purchaser's option
and provided that the Seller has a Qualified Substitute Mortgage Loan, rather
than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan
(a "Deleted Mortgage Loan") and substitute in its place a Qualified Substitute
Mortgage Loan or Loans, provided that any such substitution shall be effected
not later than one hundred twenty (120) days after the related Closing Date. If
the Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the
deficient Mortgage Loan. Any repurchase of a Mortgage Loan or Loans pursuant to
the foregoing provisions of this Subsection 9.03 shall be accomplished by either
(a) if the Interim Servicing Agreement has been entered into and is in effect,
deposit in the Custodial Account of the amount of the Repurchase Price for
distribution to the Purchaser on the next scheduled Remittance Date, after
deducting therefrom any amount received in respect of such repurchased Mortgage
Loan or Loans and being held in the Custodial Account for future distribution or
(b) if the Interim Servicing Agreement has not been entered into or is no longer
in effect, by direct remittance of the Repurchase Price to the Purchaser or its
designee in accordance with the Purchaser's instructions.
At the time of repurchase or substitution, the Purchaser and the Seller
shall arrange for the reassignment of the Deleted Mortgage Loan to the Seller
and the delivery to the Seller of any documents held by the Custodian relating
to the Deleted Mortgage Loan. In the event of a repurchase or substitution, the
Seller shall, simultaneously with such reassignment, give written notice to the
Purchaser that such repurchase or substitution has taken place, amend the
Mortgage Loan Schedule to reflect the withdrawal of the Deleted Mortgage Loan
from this Agreement, and, in the case of substitution, identify a Qualified
Substitute Mortgage Loan and amend the Mortgage Loan Schedule to reflect the
addition of such Qualified Substitute Mortgage Loan to this Agreement. In
connection with any such substitution, the Seller shall be deemed to have made
as to such Qualified Substitute Mortgage Loan the representations and warranties
set forth in this Agreement except that all such representations and warranties
set forth in this Agreement shall be deemed made as of the date of such
substitution. The Seller shall effect such substitution by delivering to the
Custodian or to such other party as the Purchaser may designate in writing for
such Qualified Substitute Mortgage Loan the documents required by Subsection
6.03, with the Mortgage Note endorsed as required by Subsection 6.03. No
substitution will be made in any calendar month after the Determination Date for
such month. The Seller shall cause the Interim Servicer to remit directly to the
Purchaser, or its designee in accordance with the Purchaser's instructions the
Monthly Payment less the Servicing Fee due, if any, on such Qualified Substitute
Mortgage Loan or Loans in the month following the date of such substitution.
Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the
month of substitution shall be retained by the Seller. For the month of
substitution, distributions to the Purchaser shall include the Monthly Payment
due on any Deleted Mortgage Loan in the month of substitution, and the Seller
shall thereafter be entitled to retain all amounts subsequently received by the
Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the Seller
shall indemnify the Purchaser and its present and former directors, officers,
employees and agents and any Successor Servicer and its present and former
directors, officers, employees and agents and hold such parties harmless against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses and
related costs, judgments, and other costs and expenses resulting from any claim,
demand, defense or assertion based on or grounded upon, or resulting from, a
breach of the Seller representations and warranties contained in this Agreement
or any Reconstitution Agreement. It is understood and agreed that the
obligations of the Seller set forth in this Subsection 9.03 to cure, substitute
for or repurchase a defective Mortgage Loan and to indemnify the Purchaser and
Successor Servicer as provided in this Subsection 9.03 and Subsection 14.01
constitute the sole remedies of the Purchaser and Successor Servicer respecting
a breach of the foregoing representations and warranties. For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
Any cause of action against the Seller relating to or arising out of the
breach of any representations and warranties made in Subsections 9.01 and 9.02
shall accrue as to any Mortgage Loan upon (i) discovery of such breach by the
Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by the
Seller to cure such breach or repurchase such Mortgage Loan as specified above,
and (iii) demand upon the Seller by the Purchaser for compliance with this
Agreement.
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full.
If any Mortgage Loan is prepaid within ninety (90) days from and after the
related Closing Date, the Seller shall pay to the Purchaser, within thirty (30)
days of notice from Purchaser, an amount equal to the Premium Percentage
multiplied by the outstanding principal balance of such Mortgage Loan as of the
date of such prepayment in full less any prepayment penalty actually received by
Purchaser. The Purchaser shall notify and invoice the Seller of any obligation
to remit such premium for such Mortgage Loan pursuant to this Subsection 9.04
within one hundred eighty (180) days following the Closing Date for claim to be
valid and enforceable; provided that Seller, as Interim Servicer, has notified
Purchaser that such Mortgage Loan prepaid in Seller's monthly reports in its
capacity as interim servicer.
Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults.
(a) If the related Mortgagor is delinquent with respect to the Mortgage
Loan's first Monthly Payment after origination of such Mortgage Loan, the
Seller, at the Purchaser's option exercised in its sole discretion, shall
acknowledge the delinquency and its obligations under this Section 9.05 within
ten (10) days of such Mortgage Loan's delinquency and shall repurchase such
Mortgage Loan from the Purchaser within twenty-five (25) days of such
delinquency at a price equal to the percentage of par as stated in the related
Purchase Price and Terms Agreement (subject to adjustment as provided therein)
multiplied by the then outstanding principal balance of such Mortgage Loan, plus
accrued and unpaid interest thereon from the date to which interest was last
paid through the day prior to the repurchase date at the applicable Mortgage
Interest Rate, plus any outstanding advances owed to any servicer in connection
with such Mortgage Loan.
(b) If the related Mortgagor is delinquent with respect to the Mortgage
Loan's Monthly Payment due in the month in which the related Closing Date occurs
or the Monthly Payment due in the first calendar month following the month in
which the related Closing Date occurs, in each case on its due date, all in
accordance with the terms of the related Mortgage Note, the Seller shall
repurchase such Mortgage Loan from the Purchaser within twenty-five (25) days of
Purchaser's repurchase request at a price equal to the percentage of par as
stated in the related Purchase Price and Terms Agreement (subject to adjustment
as provided therein) multiplied by the then outstanding principal balance of
such Mortgage Loan, plus accrued and unpaid interest thereon from the date to
which interest was last paid through the day prior to the repurchase date at the
applicable Mortgage Interest Rate, plus any outstanding advances owed to any
servicer in connection with such Mortgage Loan.
The Purchaser shall notify and invoice the Seller of any obligation to
repurchase such Mortgage Loan pursuant to this Subsection 9.05 within one
hundred eighty (180) days following the Closing Date for claim to be valid and
enforceable; provided that Seller, as Interim Servicer, properly reported such
delinquency to Purchaser in its monthly reports.
Subsection 9.06 [Reserved].
SECTION 10. Closing.
The closing for the purchase and sale of each Mortgage Loan Package shall
take place on the related Closing Date. At the Purchaser's option, the Closing
shall be either: by telephone, confirmed by letter or wire as the parties shall
agree, or conducted in person, at such place as the parties shall agree.
The closing for the Mortgage Loans to be purchased on each Closing Date
shall be subject to each of the following conditions:
(a) at least two (2) Business Days prior to the related Closing Date,
the Seller shall deliver to the Purchaser, in electronic format
acceptable to the Purchaser in its sole discretion, a listing on a
loan-level basis of the necessary information to compute the
Purchase Price of the Mortgage Loans delivered on the Closing Date
(including accrued interest), and prepare a Mortgage Loan Schedule;
(b) all of the representations and warranties of the Seller under this
Agreement and of the Interim Servicer under the Interim Servicing
Agreement (with respect to each Mortgage Loan for an interim period,
as specified therein) shall be true and correct as of the related
Closing Date and no event shall have occurred which, with notice or
the passage of time, would constitute a default under this Agreement
or an Event of Default under the Interim Servicing Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys
shall have received in escrow, all closing documents as specified in
Section 11 of this Agreement, 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 Seller shall have delivered and released to the Custodian all
documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the Seller
on the related Closing Date the Purchase Price, plus accrued interest pursuant
to Section 4 of this Agreement, by wire transfer of immediately available funds
to the account designated by the Seller.
SECTION 11. Closing Documents.
The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date shall consist of fully executed originals of the following
documents:
1. this Agreement (to be executed and delivered only for the initial
Closing Date);
2. [Reserved];
3. [Reserved];
4. the related Mortgage Loan Schedule, segregated by Mortgage Loan
Package;
5. a Custodian's Certification, as required under the Custodial
Agreement, in the form of Exhibit G-1 to the Custodial Agreement
unless such Custodian Certification has not been provided due to
Custodian's default under the Custodial Agreement;
6. [Reserved];
7. [Reserved];
8. with respect to the initial Closing Date, an Officer's Certificate,
in the form of Exhibit C hereto with respect to each of the Seller
and the Interim Servicer, including all attachments hereto; with
respect to subsequent Closing Dates, an Officer's Certificate upon
request of the Purchaser;
9. with respect to the initial Closing Date, an Opinion of Counsel of
each of the Seller and the Interim Servicer (who may be an employee
of the Seller or the Interim Servicer, as applicable), in the form
of Exhibit D hereto ("Opinion of Counsel of the Seller"); with
respect to subsequent Closing Dates, an Opinion of Counsel of the
Seller upon request of the Purchaser;
10. [Reserved];
11. a Security Release Certification, in the form of Exhibit E or F, as
applicable, hereto executed by any person, as requested by the
Purchaser, if any of the Mortgage Loans have at any time been
subject to any security interest, pledge or hypothecation for the
benefit of such person;
12. a certificate or other evidence of merger or change of name, signed
or stamped by the applicable regulatory authority, if any of the
Mortgage Loans were acquired by the Seller by merger or acquired or
originated by the Seller while conducting business under a name
other than its present name, if applicable;
13. with respect to the initial Closing Date, the Underwriting
Guidelines to be attached to the related Assignment and Conveyance
as Exhibit C;
14. Assignment and Conveyance Agreement in the form of Exhibit H hereto;
and
15. Exhibit B to the related Assignment and Conveyance Agreement.
The Seller shall bear the risk of loss of the closing documents until such
time as they are received by the Purchaser or its attorneys.
SECTION 12. Costs.
The Purchaser shall pay any commissions due its salesmen and the legal
fees and expenses of its attorneys and custodial fees. All other costs and
expenses incurred in connection with the transfer and delivery of the Mortgage
Loans and the Servicing Rights including recording fees, fees for title policy
endorsements and continuations, fees for recording Assignments of Mortgage, and
the Seller's attorney's fees, shall be paid by the Seller.
SECTION 13. Cooperation of Seller with a Reconstitution.
The Seller and the Purchaser agree that with respect to some or all of the
Mortgage Loans, after each Closing Date, on one or more dates (each, a
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may effect
Reconstitution of some or all of the Mortgage Loans then subject to this
Agreement, without recourse, to:
a) Xxxxxx Xxx under its Cash Purchase Program or MBS Program (Special
Servicing Option) (each, a "Xxxxxx Mae Transfer"); or
b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
c) one or more third party purchasers in one or more Whole Loan
Transfers; or
d) one or more trusts or other entities to be formed as part of one or
more Securitization Transactions.
The Seller agrees to execute in connection with any Agency Transfer, any
and all reasonably acceptable pool purchase contracts, and/or agreements among
the Purchaser, the Seller, Xxxxxx Xxx or Xxxxxxx Mac (as the case may be) and
any servicer in connection with a Whole Loan Transfer, a seller's warranties and
servicing agreement or a participation and servicing agreement in form and
substance reasonably acceptable to the parties, and in connection with a
Securitization Transaction, a pooling and servicing agreement in form and
substance reasonably acceptable to the parties or an Assignment and Recognition
Agreement substantially in the form attached hereto as Exhibit J (collectively,
the agreements referred to herein are designated, the "Reconstitution
Agreements"), together with an opinion of counsel with respect to such
Reconstitution Agreements.
With respect to each Whole Loan Transfer and each Securitization Transfer
entered into by the Purchaser, the Seller agrees (1) to cooperate fully with the
Purchaser and any prospective purchaser with respect to all reasonable requests
and due diligence procedures; (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 and the Interim
Servicing Agreement as of the related Reconstitution Date (or, with respect to
the Servicing Transfer Representations, the Transfer Date) or make the
representations and warranties set forth in the related selling/servicing guide
of the servicer or issuer, as the case may be, or such representations or
warranties as may be required by any Rating Agency or prospective purchaser of
the related securities or such Mortgage Loans, in connection with such
Reconstitution provided, however, that Purchaser provides notice of any such
additional representation (in addition to, and other than in, the assignment,
assumption and recognition agreement) and that any such representations and/or
warranties shall not conflict with the representations and warranties made by
the Seller in this Agreement and shall not in any event materially expand or
increase the duties, obligations and/or liabilities of Seller beyond the duties,
obligations and liabilities agreed to by Seller in this Agreement without the
written consent of Seller (which shall not be unreasonably withheld). The Seller
shall provide to such servicer or issuer, as the case may be, and any other
participants or purchasers in such Reconstitution: (i) any and all information
and appropriate verification of information which may be reasonably available to
the Seller or its affiliates, whether through letters of its auditors and
counsel or otherwise, as the Purchaser or any such other participant shall
request; and (ii) such additional representations, warranties, covenants,
opinions of counsel, letters from auditors, and certificates of public officials
or officers of the Seller or the Interim Servicer as are reasonably believed
necessary by the Purchaser or any such other participant provided, however, that
Purchaser provides notice of any such additional representation (in addition to,
and other than in, the assignment, assumption and recognition agreement) and
that any such representations and/or warranties shall not conflict with the
representations and warranties made by the Seller in this Agreement and shall
not in any event materially expand or increase the duties, obligations and/or
liabilities of Seller beyond the duties, obligations and liabilities agreed to
by Seller in this Agreement without the written consent of Seller (which shall
not be unreasonably withheld); and (iii) to execute, deliver and satisfy all
conditions set forth in any indemnity agreement required by the Purchaser or any
such participant, including, without limitation, an Indemnification and
Contribution Agreement in substantially the form attached hereto as Exhibit K.
Moreover, the Seller agrees to cooperate with all reasonable requests made by
the Purchaser to effect such Reconstitution Agreements. The Seller shall
indemnify the Purchaser, each affiliate of the Purchaser participating in the
Reconstitution and each Person who controls the Purchaser or such affiliate and
their respective present and former directors, officers, employees and agents,
and 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 each of them may sustain in any way
related to any information provided by or on behalf of the Seller regarding the
Seller, the Seller's servicing practices or performance, the Mortgage Loans or
the Underwriting Guidelines set forth in any offering document prepared in
connection with any Reconstitution. For purposes of the previous sentence,
"Purchaser" shall mean the Person then acting as the Purchaser under this
Agreement and any and all Persons who previously were "Purchasers" under this
Agreement.
In the event the Purchaser has elected to have the Interim Servicer or the
Seller hold record title to the Mortgages, prior to the Reconstitution Date, the
Interim Servicer or the Seller shall prepare an assignment of mortgage in blank
or to the prospective purchaser or trustee, as applicable, from the Interim
Servicer or the Seller, as applicable, acceptable to the prospective purchaser
or trustee, as applicable, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), track such Assignments of
Mortgage to ensure they have been recorded and deliver them as required by the
prospective purchaser or trustee, as applicable, upon the Interim Servicer's
receipt thereof. Additionally, the Interim Servicer shall prepare and execute or
shall cause the Seller to execute, at the direction of the Purchaser, any note
endorsement in connection with any and all seller/servicer agreements.
All Mortgage Loans not sold or transferred pursuant to a Reconstitution
shall remain subject to this Agreement and, if the Interim Servicing Agreement
shall remain in effect with respect to the related Mortgage Loan Package, shall
continue to be serviced in accordance with the terms of this Agreement and the
Interim Servicing Agreement and with respect thereto this Agreement shall remain
in full force and effect.
SECTION 14. The Seller.
Subsection 14.01 Additional Indemnification by the Seller; Third Party
Claims.
(a) The Seller shall indemnify the Purchaser and its present and former
directors, officers, employees and agents and any Successor Servicer and its
present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees (including legal fees incurred in connection with the
enforcement of the Seller's indemnification obligation under this Section 14.01)
and related costs, judgments, and any other costs, fees and expenses that such
parties may sustain in any way related to the failure of the Seller to perform
its duties and the Interim Servicer to service the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 13 or any breach of any of Seller's
representations, warranties and covenants set forth in this Agreement (provided
that such costs shall not include any lost profits). For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
(b) Promptly after receipt by an indemnified party under this Section
14.01 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 14.01, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
the indemnifying party from any liability which it may have to any indemnified
party under this Section 14.01, except to the extent that it has been prejudiced
in any material respect, or from any liability which it may have, otherwise than
under this Section 14.01. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
or parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election so to assume the
defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party for expenses
incurred by the indemnified party in connection with the defense thereof unless
(i) the indemnified party shall have employed separate counsel in connection
with the assertion of legal defenses in accordance with the proviso to the next
preceding sentence (it being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one separate counsel (together
with one local counsel, if applicable)), (ii) the indemnifying party shall not
have employed counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
Subsection 14.02 Merger or Consolidation of the Seller.
The Seller 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 Seller may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Seller shall be a party, or any Person succeeding to the business of the Seller,
shall be the successor of the Seller hereunder, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that the
successor or surviving Person shall have a net worth of at least $10,000,000.
SECTION 15. Financial Statements.
The Seller understands that in connection with the Purchaser's marketing
of the Mortgage Loans, the Purchaser shall make available to prospective
purchasers audited financial statements of the Seller's parent company and
unaudited financial statements of the Seller for the most recently completed
three (3) fiscal years respecting which such statements are available, as well
as a Consolidated Statement of Condition of the Seller at the end of the last
two (2) fiscal years covered by such Consolidated Statement of Operations. The
Seller shall also make available any comparable interim statements to the extent
any such statements have been prepared by the Seller (and are available upon
request to members or stockholders of the Seller or the public at large). The
Seller, if it has not already done so, agrees to furnish promptly to the
Purchaser copies of the statements specified above. The Seller shall also make
available information on its servicing performance with respect to loans
serviced for others, including delinquency ratios.
The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by
any prospective purchaser regarding recent developments affecting the Seller or
the financial statements of the Seller to the extent such information is public
information.
SECTION 16. Mandatory Delivery; Grant of Security Interest.
The sale and delivery on the related Closing Date of the Mortgage Loans
described on the related Mortgage Loan Schedule is mandatory from and after the
date of the execution of the related Purchase Price and Terms Agreement, it
being specifically understood and agreed that each Mortgage Loan is unique and
identifiable on the date hereof and that an award of money damages would be
insufficient to compensate the Purchaser for the losses and damages incurred by
the Purchaser (including damages to prospective purchasers of the Mortgage
Loans) in the event of the Seller's failure to deliver (i) each of the related
Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans or (iii)
one or more Mortgage Loans otherwise acceptable to the Purchaser on or before
the related Closing Date. The Seller hereby grants to the Purchaser a lien on
and a continuing security interest in each Mortgage Loan and each document and
instrument evidencing each such Mortgage Loan to secure the performance by the
Seller of its obligations under the related Purchase Price and Terms Agreement,
and the Seller agrees that it shall hold such Mortgage Loans in custody for the
Purchaser subject to the Purchaser's (i) right to reject any Mortgage Loan (or
Qualified Substitute Mortgage Loan) under the terms of this Agreement and to
require another Mortgage Loan (or Qualified Substitute Mortgage Loan) to be
substituted therefor, and (ii) obligation to pay the Purchase Price for the
Mortgage Loans. All rights and remedies of the Purchaser under this Agreement
are distinct from, and cumulative with, any other rights or remedies under this
Agreement or afforded by law or equity and all such rights and remedies may be
exercised concurrently, independently or successively.
SECTION 17. Notices.
All demands, notices and communications hereunder shall be in writing and
shall be given via email, facsimile transmission or registered or certified mail
to the person at the address set forth below:
(i) if to the Seller:
First Horizon Home Loan Corporation
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxx, Xxxxxx, 00000
Attention: Xxxx Xxxxx
Fax: (000) 000-0000
Phone: (000) 000-0000
Email: xxxxxxxxxxx@xxxxxxxxxxxx.xxx
(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: (000)-000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: (000)-000-0000
Email: xxxxxx.xxxxx@xxxxxx.xxx
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 18. Severability Clause.
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 19. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.
SECTION 20. Governing Law Jurisdiction; Consent to Service of Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED COUNTERPART
THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND SHALL BE
DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT SHALL BE
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
ITS CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER
IRREVOCABLY (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH
COURT; (III) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY
SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW; AND (IV) CONSENTS
TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL
ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER.
SECTION 21. Intention of the Parties.
It is the intention of the parties that the Purchaser is purchasing, and
the Seller is selling the Mortgage Loans and not a debt instrument of the Seller
or another security. Accordingly, the parties hereto each intend to treat the
transaction for Federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. Moreover, the arrangement
under which the Mortgage Loans are held shall be consistent with classification
of such arrangement as a grantor trust in the event it is not found to represent
direct ownership of the Mortgage Loans. The Purchaser shall have the right to
review the Mortgage Loans and the related Mortgage Loan Files to determine the
characteristics of the Mortgage Loans which shall affect the Federal income tax
consequences of owning the Mortgage Loans and the Seller shall cooperate with
all reasonable requests made by the Purchaser in connection with the review of
such tax consequences. Regardless of such review, provided that Seller shall
have reasonably cooperated on such review, Seller shall have no obligation to
either repurchase such Mortgage Loan or indemnify Purchaser for such Mortgage
Loan in the event there is an adverse tax consequence to Seller, except as
specifically provided herein.
SECTION 22. Successors and Assigns; Assignment of Purchase Agreement.
This Agreement shall bind and inure to the benefit of and be enforceable
by the Seller and the Purchaser and the respective permitted successors and
assigns of the Seller and the successors and assigns of the Purchaser. This
Agreement shall not be assigned, pledged or hypothecated by the Seller to a
third party without the prior written consent of the Purchaser, which consent
may be withheld by the Purchaser in its sole discretion. This Agreement may be
assigned, pledged or hypothecated by the Purchaser in whole or in part, and with
respect to one or more of the Mortgage Loans, without the consent of the Seller.
There shall be no limitation on the number of assignments or transfers allowable
by the Purchaser with respect to the Mortgage Loans and this Agreement. In the
event the Purchaser assigns this Agreement, and the assignee assumes any of the
Purchaser's obligations hereunder, the Seller acknowledges and agrees to look
solely to such assignee, and not to the Purchaser, for performance of the
obligations so assumed and the Purchaser shall be relieved from any liability to
the Seller with respect thereto.
SECTION 23. Waivers.
No term or provision of this Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced.
SECTION 24. Exhibits.
The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.
SECTION 25. General Interpretive Principles.
For purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires:
(a) the terms defined in this Agreement have the meanings assigned to them
in this Agreement and include the plural as well as the singular, and the use of
any gender herein shall be deemed to include the other gender;
(b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) references herein to "Articles," "Sections," "Subsections,"
"Paragraphs," and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other subdivisions of
this Agreement;
(d) reference to a Subsection without further reference to a Section is a
reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(e) the words "herein," "hereof," "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular provision;
and
(f) the term "include" or "including" shall mean without limitation by
reason of enumeration.
SECTION 26. Reproduction of Documents.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by any party at the closing, and (c) financial
statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 27. Further Agreements.
The Seller and the Purchaser each agree to execute and deliver to the
other such reasonable and appropriate additional documents, instruments or
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.
SECTION 28. 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 their 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 at the Seller's expense in the event recordation is either necessary
under applicable law or requested by the Purchaser at its sole option (other
than with respect to the MERS Designated Mortgage Loans).
SECTION 29. No Solicitation.
From and after the Closing Date, the Seller agrees that it will not take
any action or permit or cause any action to be taken by any of its agents or
affiliates, or by any independent contractors on the Seller's behalf, to
personally, by telephone or mail (via electronic means or otherwise), solicit
the borrower or obligor under any Mortgage Loan for any purpose whatsoever
related to such Mortgage Loan, including to refinance a Mortgage Loan, in whole
or in part, without the prior written consent of the Purchaser. It is understood
and agreed that all rights and benefits relating to the solicitation of any
Mortgagors and the attendant rights, title and interest in and to the list of
such Mortgagors and data relating to their Mortgages (including insurance
renewal dates) shall be transferred to the Purchaser pursuant hereto on the
Closing Date and the Seller shall take no action to undermine these rights and
benefits. Notwithstanding the foregoing, it is understood and agreed that
promotions undertaken by the Seller or any affiliate of the Seller which are
directed to the general public at large, including, without limitation, mass
mailing based on commercially acquired mailing lists, newspaper, radio and
television advertisements shall not constitute solicitation under this Section
29.
SECTION 30. Waiver of Trial by Jury.
THE SELLER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS AGREEMENT.
SECTION 31. Compliance with Regulation AB
Subsection 31.01 Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose of
Section 31 of this Agreement is to facilitate compliance by the Purchaser and
any Depositor with the provisions of Regulation AB and related rules and
regulations of the Commission. Although Regulation AB is applicable by its terms
only to offerings of asset-backed securities that are registered under the
Securities Act, the Seller acknowledges that investors in privately offered
securities may require that the Purchaser or any Depositor provide comparable
disclosure in unregistered offerings. References in this Agreement to compliance
with Regulation AB include provision of comparable disclosure in private
offerings.
Neither the Purchaser nor any Depositor shall exercise its right to
request delivery of information or other performance under these provisions
other than in good faith, or for purposes other than compliance with the
Securities Act, the Exchange Act and the rules and regulations of the Commission
thereunder (or the provision in a private offering of disclosure comparable to
that required under the Securities Act). The Seller acknowledges that
interpretations of the requirements of Regulation AB may change over time,
whether due to interpretive guidance provided by the Commission or its staff,
consensus among participants in the asset backed securities markets, advice of
counsel, or otherwise, and agrees to comply with requests made by the Purchaser
or any Depositor in good faith for delivery of information under these
provisions on the basis of evolving interpretations of Regulation AB. In
connection with any Securitization Transaction, the Seller 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 Seller, any Third Party Originator and the Mortgage
Loans, or the servicing of the Mortgage Loans, reasonably believed by the
Purchaser or any Depositor to be necessary in order to effect such compliance.
The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller by providing timely notice of requests for information
under these provisions and by reasonably limiting such requests to information
required, in the Purchaser's reasonable judgment, to comply with Regulation AB.
Subsection 31.02 Additional Representations and Warranties of the
Seller.
(a) The Seller shall be deemed to represent to the Purchaser and to any
Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Subsection 31.03 that, except as disclosed in
writing to the Purchaser or such Depositor prior to such date: (i) the Seller is
not aware and has not received notice that any default, early amortization or
other performance triggering event has occurred as to any other securitization
due to any act or failure to act of the Seller; (ii) the Interim Servicer has
not been terminated as servicer in a residential mortgage loan securitization,
either due to a servicing default or to application of a servicing performance
test or trigger; (iii) no material noncompliance with the applicable servicing
criteria with respect to other securitizations of residential mortgage loans
involving the Interim Servicer as servicer has been disclosed or reported by the
Seller; (iv) no material changes to the Interim Servicer's policies or
procedures with respect to the servicing function it will perform under the
Interim Servicing Agreement and any Reconstitution Agreement for mortgage loans
of a type similar to the Mortgage Loans have occurred during the three year
period immediately preceding the related Securitization Transaction; (v) there
are no aspects of the Interim Servicer's financial condition that could have a
material adverse effect on the performance by the Interim Servicer of its
servicing obligations under the Interim Servicing Agreement or any
Reconstitution Agreement; (vi) there are no material legal or governmental
proceedings pending (or known to be contemplated) against the Seller, Interim
Servicer, any Subservicer or any Third Party Originator; and (vii) there are no
affiliations, relationships or transactions relating to the Seller, Interim
Servicer, any Subservicer or any Third Party Originator with respect to any
Securitization Transaction and any party thereto identified by the related
Depositor of a type described in Item 1119 of Regulation AB.
(b) If so requested by the Purchaser or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Subsection 31.03, the Seller shall, within five (5) Business
Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section or, if
any such representation and warranty is not accurate as of the date of such
request, provide reasonably adequate disclosure of the pertinent facts, in
writing, to the requesting party.
Subsection 31.03 Information To Be Provided by the Seller.
In connection with any Securitization Transaction the Seller shall (i)
within five (5) Business Days following request by the Purchaser or any
Depositor, provide to the Purchaser and such Depositor (or, as applicable, cause
each Third Party Originator to provide), in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, the information and
materials specified in paragraphs (a) and (b) of this Section, and (ii) as
promptly as practicable following notice to or discovery by the Seller, provide
to the Purchaser and any Depositor (in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor) the information
specified in paragraph (d) of this Section.
(a) If so requested by the Purchaser or any Depositor, the Seller shall
provide such information regarding (i) the Seller, as originator of the Mortgage
Loans (including as an acquirer of Mortgage Loans from a Qualified
Correspondent), or (ii) each Third Party Originator, as is requested for the
purpose of compliance with Items 1103(a)(1), 1105, 1110, 1117 and 1119 of
Regulation AB. Such information shall include, at a minimum:
(A) the originator's form of organization;
(B) a description of the originator's origination program and how long the
originator has been engaged in originating residential mortgage loans, which
description shall include a discussion of the originator's experience in
originating mortgage loans of a similar type as the Mortgage Loans; information
regarding the size and composition of the originator's origination portfolio;
and information that may be material, in the good faith judgment of the
Purchaser or any Depositor, to an analysis of the performance of the Mortgage
Loans, including the originators' credit granting or underwriting criteria for
mortgage loans of similar type(s) as the Mortgage Loans and such other
information as the Purchaser or any Depositor may reasonably request for the
purpose of compliance with Item 1110(b)(2) of Regulation AB;
(C) a description of any material legal or governmental proceedings
pending (or known to be contemplated) against the Seller and each Third Party
Originator; and
(D) a description of any affiliation or relationship between the Seller,
each Third Party Originator and any of the following parties to a Securitization
Transaction, as such parties are identified to the Seller by the Purchaser or
any Depositor in writing in advance of such Securitization Transaction:
(1) the sponsor;
(2) the depositor;
(3) the issuing entity;
(4) any servicer;
(5) any trustee;
(6) any originator;
(7) any significant obligor;
(8) any enhancement or support provider; and
(9) any other material transaction party.
(b) If so requested by the Purchaser or any Depositor, to the extent
required by Regulation AB, the Seller shall provide (or, as applicable, cause
each Third Party Originator to provide), to the extent available to the Seller
or such Third-Party Originator (and not otherwise available to the Purchaser)
without unreasonable effort or expense, Static Pool Information with respect to
the mortgage loans (of a similar type as the Mortgage Loans, as reasonably
identified by the Purchaser as provided below) originated by (i) the Seller, if
the Seller is an originator of Mortgage Loans (including as an acquirer of
Mortgage Loans from a Qualified Correspondent), and/or (ii) each Third Party
Originator. Such Static Pool Information shall be prepared by the Seller (or
Third Party Originator) on the basis of its reasonable, good faith
interpretation of the requirements of Item 1105(a)(1) (3) of Regulation AB. To
the extent that there is reasonably available to the Seller (or Third Party
Originator) Static Pool Information with respect to more than one mortgage loan
type, the Purchaser or any Depositor shall be entitled to specify whether some
or all of such information shall be provided pursuant to this paragraph. The
content of such Static Pool Information may be in the form customarily provided
by the Seller, and need not be customized for the Purchaser or any Depositor.
Such Static Pool Information for each vintage origination year or prior
securitized pool, as applicable, shall be presented in increments no less
frequently than quarterly over the life of the mortgage loans included in the
vintage origination year or prior securitized pool. The most recent periodic
increment must be as of a date no later than one hundred thirty-five (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 Seller 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 Seller shall use commercially reasonable efforts to provide the
Static Pool Information required hereunder; provided, however, that failure of
the Seller to perform such obligations, after applying commercially reasonable
efforts, shall not result in a breach by the Seller of the provisions of this
Agreement.
Promptly following notice or discovery of a material error in Static Pool
Information provided pursuant to the immediately preceding paragraph (including
an omission to include therein information required to be provided pursuant to
such paragraph), the Seller shall provide corrected Static Pool Information to
the Purchaser or any Depositor, as applicable, in the same format in which
Static Pool Information was previously provided to such party by the Seller.
If so requested by the Purchaser or any Depositor, the Seller shall
provide (or, as applicable, cause each Third Party Originator to provide), at
the expense of the requesting party (to the extent of any additional incremental
expense associated with delivery pursuant to this Agreement), such agreed upon
procedures letters of certified public accountants reasonably acceptable to the
Purchaser or Depositor, as applicable, pertaining to Static Pool Information
relating to prior securitized pools for securitizations closed on or after
January 1, 2006 or, in the case of Static Pool Information with respect to the
Seller's or Third Party Originator's originations or purchases, to calendar
months commencing January 1, 2006, as the Purchaser or such Depositor shall
reasonably request. Such letters shall be addressed to and be for the benefit of
such parties as the Purchaser or such Depositor shall designate, which may
include, by way of example, any Sponsor, any Depositor and any broker dealer
acting as underwriter, placement agent or initial purchaser with respect to a
Securitization Transaction. Any such statement or letter may take the form of a
standard, generally applicable document accompanied by a reliance letter
authorizing reliance by the addressees designated by the Purchaser or such
Depositor.
(c) With respect to those Mortgage Loans that were sold to the Purchaser
pursuant to this Agreement, the Purchaser shall provide or cause the servicer
(or another party) to be obligated to provide information, upon request by
Seller in the form customarily provided by the Purchaser, the servicer or such
other party (which need not be customized for the Seller) with respect to the
Mortgage Loans reasonably necessary for the Seller to comply with its
obligations under Regulation AB, including, without limitation, providing to the
Seller Static Pool Information, as set forth in Item 1105(a)(2) and (3) of
Regulation AB (such information provided by the Purchaser, the servicer or such
other party, the "Loan Performance Data"). The Purchaser shall, or shall cause
the servicer (or another party) to be obligated to, indemnify the Seller for 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 (A) any untrue statement of a
material fact contained or alleged to be contained in the Loan Performance Data
or (B) the omission or alleged omission to state in the Loan Performance Data 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; provided, by way of clarification, that clause (B) of this
paragraph shall be construed solely by reference to the Loan Performance Data.
(d) If so requested by the Purchaser or any Depositor for the purpose of
satisfying its reporting obligation under the Exchange Act with respect to any
class of asset backed securities, the Seller shall (or shall cause each Third
Party Originator to) (i) notify the Purchaser and any Depositor in writing of
(A) any material litigation or governmental proceedings pending against the
Seller or any Third Party Originator and (B) any affiliations or relationships
that develop following the closing date of a Securitization Transaction between
the Seller or any Third Party Originator and any of the parties specified in
clause (D) of paragraph (a) of this Section (and any other parties identified in
writing by the requesting party) with respect to such Securitization
Transaction, and (ii) provide to the Purchaser and any Depositor a description
of such proceedings, affiliations or relationships.
Subsection 31.04 Indemnification; Remedies.
(a) The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser, the Depositor, and each of the following parties participating in a
Securitization Transaction: each sponsor and issuing entity; each Person
responsible for the preparation, execution or filing of any report required to
be filed with the Commission with respect to such Securitization Transaction, or
for execution of a certification pursuant to Rule 13a 14(d) or Rule 15d 14(d)
under the Exchange Act with respect to such Securitization Transaction; each
broker dealer acting as underwriter, placement agent or initial purchaser, each
Person who controls any of such parties or the Depositor (within the meaning of
Section 15 of the Securities Act and Section 20 of the Exchange Act); and the
respective present and former directors, officers, employees and agents of each
of the foregoing and of the Depositor, and shall hold each of them harmless from
and against any losses, damages, penalties, fines, forfeitures, legal fees and
expenses and related costs, judgments, and any other costs, fees and expenses
that any of them may sustain arising out of or based upon:
(i) (A) any untrue statement of a material fact contained or alleged to be
contained in any information, report, certification, accountants' letter or
other material provided in written or electronic form under this Section 31
by or on behalf of the Seller, or provided under this Section 31 by or on
behalf of any Third Party Originator (collectively, the "Seller
Information"), or (B) the omission or alleged omission to state in the Seller
Information a material fact required to be stated in the Seller Information
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, by way of
clarification, that clause (B) of this paragraph shall be construed solely by
reference to the Seller Information and not to any other information
communicated in connection with a sale or purchase of securities, without
regard to whether the Seller Information or any portion thereof is presented
together with or separately from such other information;
(ii) any failure by the Seller or any Third Party Originator to deliver
any information, report, certification, accountants' letter or other material
when and as required under this Section 31; or
(iii) any breach by the Seller of a representation or warranty set forth
in Subsection 31.02(a) or in a writing furnished pursuant to Subsection
31.02(b) and made as of a date prior to the closing date of the related
Securitization Transaction, to the extent that such breach is not cured by
such closing date, or any breach by the Seller of a representation or
warranty in a writing furnished pursuant to Subsection 31.02(b) to the extent
made as of a date subsequent to such closing date.
In the case of any failure of performance described in clause (a)(ii) of
this Section, the Seller shall promptly reimburse the Purchaser, any Depositor,
as applicable, and each Person responsible for the preparation, execution or
filing of any report required to be filed with the Commission with respect to
such Securitization Transaction, or for execution of a certification pursuant to
Rule 13a 14(d) or Rule 15d 14(d) under the Exchange Act with respect to such
Securitization Transaction, for all costs reasonably incurred by each such party
in order to obtain the information, report, certification, accountants' letter
or other material not delivered as required by the Seller or any Third Party
Originator.
(b) (i) Any failure by the Seller or any Third Party Originator to deliver
any information, report, certification, accountants' letter or other material
when and as required under this Section 31, or any breach by the Seller of a
representation or warranty set forth in Subsection 31.02(a) or in a writing
furnished pursuant to Subsection 31.02(b) and made as of a date prior to the
closing date of the related Securitization Transaction, to the extent that such
breach is not cured by such closing date, or any breach by the Seller of a
representation or warranty in a writing furnished pursuant to Subsection
31.02(b) to the extent made as of a date subsequent to such closing date, shall
immediately and automatically, without notice or grace period, constitute an
Event of Default with respect to the Seller under this Agreement and any
applicable Reconstitution Agreement, and shall entitle the Purchaser or
Depositor, as applicable, in its sole discretion to terminate the rights and
obligations of the Interim Servicer as servicer under the Interim Servicing
Agreement and/or any applicable Reconstitution Agreement without payment
(notwithstanding anything in this Agreement or any applicable Reconstitution
Agreement to the contrary) of any compensation to the Interim Servicer; provided
that to the extent that any provision of this Agreement and/or any applicable
Reconstitution Agreement expressly provides for the survival of certain rights
or obligations following termination of the Interim Servicer as servicer, such
provision shall be given effect.
[Signatures Commence on Following Page]
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their names
to be signed hereto by their respective officers thereunto duly authorized as of
the date first above written.
IXIS REAL ESTATE CAPITAL INC.
(Purchaser)
By:
______________________________________
Name:
Title:
By:
______________________________________
Name:
Title:
FIRST HORIZON HOME LOAN CORPORATION
(Seller)
By:
______________________________________
Name:
Title:
Exhibit A
EXHIBIT A
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include each
of the following items, which shall be available for inspection by the Purchaser
and any prospective Purchaser, and which shall be delivered to the Custodian, or
to such other Person as the Purchaser shall designate in writing, pursuant to
Section 6 of the Second Amended and Restated Mortgage Loan Purchase and
Warranties Agreement to which this Exhibit is attached (the "Agreement"):
(a) the original Mortgage Note bearing all intervening endorsements
evidencing a complete chain of assignment from the originator to the Seller,
endorsed "Pay to the order of _________, without recourse" and signed in the
name of the Seller by an authorized officer. The endorsement may be contained on
an allonge, if state law so allows. If the Mortgage Loan was acquired by the
Seller in a merger, the endorsement must be by "[Seller], successor by merger to
[name of predecessor]." If the Mortgage Loan was acquired or originated by the
Seller while doing business under another name, the endorsement must be by
"[Seller], formerly known as [previous name]";
(b) if applicable, the original of any guarantee executed in connection
with the Mortgage Note;
(c) the original Mortgage with evidence of recording thereon. If in
connection with any Mortgage Loan, the Seller cannot deliver or cause to be
delivered the original Mortgage with evidence of recording thereon on or prior
to the Closing Date because of a delay caused by the public recording office
where such Mortgage has been delivered for recordation or because such Mortgage
has been lost or because such public recording office retains the original
recorded Mortgage, the Seller shall deliver or cause to be delivered to the
Custodian, (i) a Seller certified photocopy of such Mortgage; or (ii) in the
case of a Mortgage where a public recording office retains the original recorded
Mortgage or in the case where a Mortgage is lost after recordation in a public
recording office, a copy of such Mortgage certified by such public recording
office to be a true and complete copy of the original recorded Mortgage;
(d) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;
(e) except with respect to each MERS Designated Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording. The Assignment of Mortgage must be duly recorded only
if recordation is either necessary under applicable law or commonly required by
private institutional mortgage investors in the area where the Mortgaged
Property is located or on direction of the Purchaser as provided in this
Agreement. If the Assignment of Mortgage is to be recorded, the Mortgage shall
be assigned to the Purchaser. If the Assignment of Mortgage is not to be
recorded, the Assignment of Mortgage shall be delivered in blank. If the
Mortgage Loan was acquired by the Seller in a merger, the Assignment of Mortgage
must be made by "[Seller], successor by merger to [name of predecessor]". If the
Mortgage Loan was acquired or originated by the Seller while doing business
under another name, the Assignment of Mortgage must be by "[Seller], formerly
known as [previous name]";
(f) the originals of all intervening assignments of mortgage, evidencing a
complete chain of assignment from the originator to the Seller (or MERS with
respect to each MERS Designated Mortgage Loan), with evidence of recording
thereon, or if any such intervening assignment has not been returned from the
applicable recording office or has been lost or if such public recording office
retains the original recorded assignments of mortgage, the Seller shall deliver
or cause to be delivered to the Custodian, (i) a Seller certified photocopy of
such intervening assignment; or (ii) in the case of an intervening assignment
where a public recording office retains the original recorded intervening
assignment or in the case where an intervening assignment is lost after
recordation in a public recording office, a copy of such intervening assignment
certified by such public recording office to be a true and complete copy of the
original recorded intervening assignment;
(g) The original mortgagee policy of title insurance or, in the event such
original title policy is unavailable, a certified true copy of the related
policy binder or commitment for title certified to be true and complete by the
title insurance company; and
(h) security agreement, chattel mortgage or equivalent document executed
in connection with the Mortgage.
In the event an Officer's Certificate of the Seller is delivered to the
Purchaser because of a delay caused by the public recording office in returning
any recorded document, the Seller shall deliver to the Purchaser, within ninety
(90) days of the Closing Date, an Officer's Certificate which shall (i) identify
the recorded document and (ii) state that the recorded document has not been
delivered to the Custodian due solely to a delay caused by the public recording
office; provided, however, that any recorded document shall in any event be
delivered no later than one (1) year from the applicable Closing Date. An
extension of the date specified in (iv) above may be requested from the
Purchaser, which consent shall not be unreasonably withheld.
Exhibit B
EXHIBIT B
FORM OF INTERIM SERVICING AGREEMENT
Exhibit C
EXHIBIT C
FORM OF SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected [Vice]
President of First Horizon Home Loan Corporation, a corporation organized under
the laws of the state of Kansas (the "Company"), and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete copy of
the charter of the Company which is in full force and effect on the date
hereof and which has been in effect without amendment, waiver, rescission or
modification since ___________.
2. Attached hereto as Exhibit 2 is a true, correct and complete copy of
the bylaws of the Company which are in effect on the date hereof and which
have been in effect without amendment, waiver, rescission or modification
since ___________.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Company issued within ten (10) days of the date hereof, and
no event has occurred since the date thereof which would impair such
standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete copy of
the corporate resolutions of the Board of Directors of the Company
authorizing the Company to execute and deliver each of the Second Amended and
Restated Mortgage Loan Purchase and Warranties Agreement, dated as of July 1,
2006, by and between IXIS Real Estate Capital Inc. (the "Purchaser") and the
Company (the "Purchase Agreement"), and the Amended and Restated Interim
Servicing Agreement, dated as of October 1, 2005, by and between the Company
and the Purchaser (the "Interim Servicing Agreement") and to endorse the
Mortgage Notes and execute the Assignments of Mortgages by original [or
facsimile] signature, and such resolutions are in effect on the date hereof
and have been in effect without amendment, waiver, rescission or modification
since ____________.
5. Either (i) 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 the Purchase
Agreement or the Interim Servicing Agreement, the sale of the mortgage loans
or the consummation of the transactions contemplated by the agreements; or
(ii) any required consent, approval, authorization or order has been obtained
by the Company.
6. Neither the consummation of the transactions contemplated by, nor the
fulfillment of the terms of the Purchase Agreement or the Interim Servicing
Agreement conflicts or will conflict with or results or will result in a
breach of or constitutes or will constitute a default under the charter or
by-laws of the Company, the terms of any indenture or other agreement or
instrument to which the Company is a party or by which it is bound or to
which it is subject, or any statute or order, rule, regulations, writ,
injunction or decree of any court, governmental authority or regulatory body
to which the Company is subject or by which it is bound.
7. There is no action, suit, proceeding or investigation pending or
threatened against the Company which, in my judgment, either in any one
instance or in the aggregate, may result in any material adverse change in
the business, operations, financial condition, properties or assets of the
Company or in any material impairment of the right or ability of the Company
to carry on its business substantially as now conducted or in any material
liability on the part of the Company or which would draw into question the
validity of the Purchase Agreement or the Interim Servicing Agreement, or the
mortgage loans or of any action taken or to be taken in connection with the
transactions contemplated thereby, or which would be likely to impair
materially the ability of the Company to perform under the terms of the
Purchase Agreement or the Interim Servicing Agreement.
8. Each person listed on Exhibit 5 attached hereto who, as an officer or
representative of the Company, signed (a) the Purchase Agreement, (b) the
Interim Servicing Agreement and (c) any other document delivered or on the
date hereof in connection with any purchase described in the agreements set
forth above was, at the respective times of such signing and delivery, and is
now, a duly elected or appointed, qualified and acting officer or
representative of the Company, who holds the office set forth opposite his or
her name on Exhibit 5, and the signatures of such persons appearing on such
documents are their genuine signatures.
9. The Company is duly authorized to engage in the transactions described
and contemplated in the Purchase Agreement and the Interim Servicing
Agreement.
Exhibit C
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of
the Company.
Dated:____________________ By:___________________________
Name:___________________
[Seal] Title: [Vice] President
I, ________________________, an [Assistant] Secretary of ______________
[COMPANY], hereby certify that ____________ is the duly elected, qualified and
acting [Vice] President of the Company and that the signature appearing above is
[her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated:____________________ By:___________________________
Name:___________________
Title: [Assistant] Secretary
Exhibit C
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
---- ----- ---------
________________________ ______________________ ________________________
________________________ ______________________ ________________________
________________________ ______________________ ________________________
________________________ ______________________ ________________________
________________________ ______________________ ________________________
________________________ ______________________ ________________________
Exhibit D
EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER
AND INTERIM SERVICER (date)
----------------------------------------
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General Counsel to
___________________ (the "Company"), with respect to certain matters in
connection with the sale by the Company of the Mortgage Loans pursuant to that
certain Mortgage Loan Purchase and Interim Servicing Agreement by and between
the Company and IXIS Real Estate Capital Inc. (the "Purchaser"), dated as of
January 1, 2007 (the "Purchase Agreement") which sale is in the form of whole
loans, serviced pursuant to the Purchase Agreement and, collectively with the
Purchase Agreement, the "Agreements"). Capitalized terms not otherwise defined
herein have the meanings set forth in the Purchase Agreement and the Interim
Servicing Agreement.
[We] [I] have examined the following documents:
1. the Purchase Agreement;
2. the form of Assignment of Mortgage;
3. the form of endorsement of the Mortgage Notes; and
4 such other documents, records and papers as we have deemed necessary
and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I] have
relied upon the representations and warranties of the Company and the Interim
Servicer contained in the Purchase Agreement. [We] [I] have assumed the
authenticity of all documents submitted to [us] [me] as originals, the
genuineness of all signatures, the legal capacity of natural persons and the
conformity to the originals of all documents.
Based upon the foregoing, it is [our] [my] opinion that:
1. The Company and the Interim Servicer is [type of entity] duly organized,
validly existing and in good standing under the laws of the [United
States] and are qualified to transact business in, and is in good standing
under, the laws of [the state of incorporation].
2. Each of the Company and the Interim Servicer has the power to engage in
the transactions contemplated by the Agreements to which it is a party and
all requisite power, authority and legal right to execute and deliver such
Agreements and to perform and observe the terms and conditions of such
Agreements.
3. Each of the Agreements to which it is a party has been duly authorized,
executed and delivered by the Company and the Interim Servicer, as
applicable, and is a legal, valid and binding agreement enforceable in
accordance with its respective terms against the Company and the Interim
Servicer, as applicable, 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, none of which will materially
interfere with the realization of the benefits provided thereunder or with
the Purchaser's ownership of the Mortgage Loans.
4. Each of the Company and the Interim Servicer has been duly authorized to
allow any of its officers to execute any and all documents by original
signature in order to complete the transactions contemplated by the
Agreements to which it is a party by original [or facsimile] signature in
order to execute the endorsements to the Mortgage Notes and the
Assignments of Mortgages, and the original [or facsimile] signature of the
officer at the Company executing the endorsements to the Mortgage Notes
and the Assignments of Mortgages represents the legal and valid signature
of said officer of the Company.
5. Either (i) 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 or the Interim Servicer of or compliance by the
Company or the Interim Servicer with the Agreements to which it is a party
and the sale of the Mortgage Loans by the Company or the consummation of
the transactions contemplated by the Agreements to which each is a party
or (ii) any required consent, approval, authorization or order has been
obtained by the Company or the Interim Servicer.
6. Neither the consummation of the transactions contemplated by, nor the
fulfillment of the terms of, the Agreements to which it is a party
conflicts or will conflict with or results or will result in a breach of
or constitutes or will constitute a default under the charter, by-laws or
other organizational documents of the Company or the Interim Servicer, as
applicable, the terms of any indenture or other agreement or instrument to
which the Company or the Interim Servicer is a party or by which it is
bound or to which it is subject, or violates any statute or order, rule,
regulations, writ, injunction or decree of any court, governmental
authority or regulatory body to which the Company or the Interim Servicer
is subject or by which it is bound.
7. There is no action, suit, proceeding or investigation pending or
threatened against the Company or the Interim Servicer which, in [our]
[my] judgment, either in any one instance or in the aggregate, may result
in any material adverse change in the business, operations, financial
condition, properties or assets of the Company or the Interim Servicer or
in any material impairment of the right or ability of the Company or the
Interim Servicer to carry on its business substantially as now conducted
or in any material liability on the part of the Company or the Interim
Servicer or which would draw into question the validity of the Agreements
to which it is a party or the Mortgage Loans or of any action taken or to
be taken in connection with the transactions contemplated thereby, or
which would be likely to impair the ability of the Company or the Interim
Servicer to perform under the terms of the Agreements to which it is a
party.
8. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Agreements is sufficient to fully transfer to the
Purchaser all right, title and interest of the Company thereto as
noteholder and mortgagee.
9. The Mortgages have been duly assigned and the Mortgage Notes have been
duly endorsed as provided in the Purchase Agreement. The Assignments of
Mortgage are in recordable form, except for the insertion of the name of
the assignee, and upon the name of the assignee being inserted, are
acceptable for recording under the laws of the state where each related
Mortgaged Property is located. The endorsement of the Mortgage Notes, the
delivery to the Purchaser, or its designee, of the Assignments of
Mortgage, and the delivery of the original endorsed Mortgage Notes to the
Purchaser, or its designee, are sufficient to permit the Purchaser to
avail itself of all protection available under applicable law against the
claims of any present or future creditors of the Company, and are
sufficient to prevent any other sale, transfer, assignment, pledge or
hypothecation of the Mortgages and the Mortgage Notes by the Company from
being enforceable.
This opinion is given to you for your sole benefit, and no other person or
entity is entitled to rely hereon except that the purchaser or purchasers to
which you initially and directly resell the Mortgage Loans may rely on this
opinion as if it were addressed to them as of its date.
Very truly yours,
------------------------------------
[Name]
[Assistant] General Counsel
Exhibit E
EXHIBIT E
FORM OF SECURITY RELEASE CERTIFICATION
___________________, _____
________________________
________________________
________________________
Attention: ___________________________
___________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that First Horizon Home Loan Corporation a
[type of entity], organized pursuant to the laws of [the state of incorporation]
(the "Company") has committed to sell to IXIS Real Estate Capital Inc. under a
Second Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of July 1, 2006, certain mortgage loans originated by the Company. The
Company warrants that the mortgage loans to be sold to IXIS Real Estate Capital
Inc. are in addition to and beyond any collateral required to secure advances
made by you to the Company.
The Company acknowledges that the mortgage loans to be sold to IXIS Real
Estate Capital Inc. shall not be used as additional or substitute collateral for
advances made by [____________]. IXIS Real Estate Capital Inc. understands that
the balance of the Company's mortgage loan portfolio may be used as collateral
or additional collateral for advances made by [___________], and confirms that
it has no interest therein.
Exhibit E
Execution of this letter by [___________] shall constitute a full and
complete release of any security interest, claim, or lien which [___________]
may have against the mortgage loans to be sold to IXIS Real Estate Capital Inc.
Very truly yours,
_________________________________________
By:______________________________________
Name:____________________________________
Title:___________________________________
Date:____________________________________
Acknowledged and approved:
______________________________________
By:___________________________________
Name:_________________________________
Title:________________________________
Date:_________________________________
Exhibit F
EXHIBIT F
FORM OF SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
The financial institution named below hereby relinquishes any and all
right, title and interest it may have in all Mortgage Loans to be purchased by
IXIS Real Estate Capital Inc. from the Company named below pursuant to that
certain Second Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of July 1, 2006, and certifies that all notes, mortgages,
assignments and other documents in its possession relating to such Mortgage
Loans have been delivered and released to the Company named below or its
designees, as of the date and time of the sale of such Mortgage Loans to IXIS
Real Estate Capital Inc.
Name and Address of Financial Institution
________________________________
(Name)
________________________________
(Address)
By:_____________________________
Exhibit F
II. Certification of Release
The Company named below hereby certifies to IXIS Real Estate Capital Inc.
that, as of the date and time of the sale of the above-mentioned Mortgage Loans
to IXIS Real Estate Capital Inc. the security interests in the Mortgage Loans
released by the above-named financial institution comprise all security
interests relating to or affecting any and all such Mortgage Loans. The Company
warrants that, as of such time, there are and will be no other security
interests affecting any or all of such Mortgage Loans.
______________________________
By:___________________________
Title:________________________
Date:_________________________
Exhibit G
EXHIBIT G
LIST OF PROHIBITED STATES
1. New Jersey Owner Occupied Refinance Loans Originated between November 27,
2003 and July 6, 2004;
2. New Jersey Manufactured Housing Properties;
3. Georgia Loans Originated Between October 1, 2002 and March 7, 2003.
Exhibit H
EXHIBIT H
ASSIGNMENT AND CONVEYANCE
On this ___ day of __________, ____, ___________________ ("Seller"), as
(i) the Seller under that certain Purchase Price and Terms Agreement, dated as
of ___________, _____ (the "PPTA"), (ii) the Seller under that certain Second
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of July 1, 2006 (the "Purchase Agreement") and (iii) the Seller/Interim Servicer
under that certain Amended and Restated Interim Servicing Agreement, dated as of
October 1, 2005 (the "Interim Servicing Agreement" and, together with the PPTA
and the Purchase Agreement, the "Agreements") does hereby sell, transfer,
assign, set over and convey to IXIS Real Estate Capital Inc. ("Purchaser") as
the Purchaser under the Agreements, without recourse, but subject to the terms
of the Agreements, all right, title and interest of, in and to the Mortgage
Loans listed on the Mortgage Loan Schedule attached hereto as Exhibit A (the
"Mortgage Loans"), together with the Mortgage Files and all rights and
obligations arising under the documents contained therein. Each Mortgage Loan
subject to the Agreements was underwritten in accordance with, and conforms to,
the Underwriting Guidelines attached hereto as Exhibit C. Pursuant to Section 6
of the Purchase Agreement, the Seller has delivered to the Custodian the
documents for each Mortgage Loan to be purchased as set forth in the Custodial
Agreement. The contents of each Servicing File required to be retained by First
Horizon Home Loan Corporation ("Interim Servicer") to service the Mortgage Loans
pursuant to the Interim Servicing Agreement and thus not delivered to the
Purchaser are and shall be held in trust by the Seller in its capacity as
Interim Servicer for the benefit of the Purchaser as the owner thereof. The
Interim Servicer's possession of any portion of the Servicing File is at the
will of the Purchaser for the sole purpose of facilitating servicing of the
related Mortgage Loan pursuant to the Interim Servicing Agreement, and such
retention and possession by the Interim Servicer shall be in a custodial
capacity only. The ownership of each Mortgage Note, Mortgage, the Servicing
Rights and the contents of the Mortgage File and Servicing File is vested in the
Purchaser and the ownership of all records and documents with respect to the
related Mortgage Loan prepared by or which come into the possession of the
Seller or the Interim Servicer shall immediately vest in the Purchaser and shall
be retained and maintained, in trust, by the Seller at the will of the Purchaser
in such custodial capacity only.
The Mortgage Loan Package characteristics of the Mortgage Loans subject
hereto are set forth on Exhibit B hereto.
In accordance with Section 6 of the Purchase Agreement, the Purchaser
accepts the Mortgage Loans listed on Exhibit A attached hereto. Notwithstanding
the foregoing the Purchaser does not waive any rights or remedies it may have
under the Agreements.
Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
By:______________________________________
Name:_________________________________
Title:________________________________
Accepted and Agreed:
IXIS REAL ESTATE CAPITAL INC.
By:_____________________________
Name:________________________
Title:_______________________
By:_____________________________
Name:________________________
Title:_______________________
Exhibit H
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
Exhibit H
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL CHARACTERISTICS OF
EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on the
related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than _ months prior to the related
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than
___; or (5) a debt-to-income ratio of more than __%. Each First Lien Loan has a
Mortgage Interest Rate of at least ___% per annum and an outstanding principal
balance less than $_________. Each Second Lien Loan has a Mortgage Interest Rate
of at least ______% per annum and an outstanding principal balance less than
$________. Each Adjustable Rate Mortgage Loan has an Index of [_______].
Exhibit H
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
Exhibit I
EXHIBIT I
SELLER'S UNDERWRITING GUIDELINES
Exhibit J
EXHIBIT J
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [____________ __, 20__]
("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"),
[____________________] ("Assignee") and First Horizon Home Loan Corporation (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns to
the Assignee all of the right, title and interest of the Assignor, as purchaser,
in, to and under (a) those certain Mortgage Loans listed on the schedule (the
"Mortgage Loan Schedule") attached hereto as Exhibit A (the "Mortgage Loans")
and (b) except as described below, that certain Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement (the "Purchase Agreement"),
dated as of July 1, 2006, between the Assignor, as purchaser (the "Purchaser"),
and the Company, as seller, solely insofar as the Purchase Agreement relates to
the Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (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
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser under Section 9.04 of the Purchase Agreement.
Recognition of the Company
2. 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 Purchase Agreement (solely to the
extent set forth herein) and this Agreement to [__________________] (the
"Trust") created pursuant to a Pooling and Servicing Agreement, dated as of
[__________], 2006 (the "Pooling Agreement"), among the Assignee, the Assignor,
[___________________], as trustee (including its successors in interest and any
successor trustees under the Pooling Agreement, the "Trustee"),
[____________________], as servicer (including its successors in interest and
any successor servicer under the Pooling Agreement, the "Servicer"). The Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the Mortgage Loans, (iii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf) shall have all the rights and remedies
available to the Assignor, insofar as they relate to the Mortgage Loans, under
the Purchase Agreement, including, without limitation, the enforcement of the
document delivery requirements set forth in Section 6 of the Purchase Agreement,
and shall be entitled to enforce all of the obligations of the Company
thereunder insofar as they relate to the Mortgage Loans, and (iv) all references
to the Purchaser, the Custodian or the Bailee under the Purchase Agreement
insofar as they relate to the Mortgage Loans, shall be deemed to refer to the
Trust (including the Trustee and the Servicer acting on the Trust's behalf).
Neither the Company nor the Assignor shall amend or agree to amend, modify,
waiver, or otherwise alter any of the terms or provisions of the Purchase
Agreement which amendment, modification, waiver or other alteration would in any
way affect the Mortgage Loans or the Company's performance under the Purchase
Agreement with respect to the Mortgage Loans without the prior written consent
of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee and
the Trust as of the date hereof or such other date specified herein that:
(a) The Company is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and authority to
perform its obligations under the Purchase Agreement. The execution by the
Company of this Agreement is in the ordinary course of the Company's business
and will not conflict with, or result in a breach of, any of the terms,
conditions or provisions of the Company's charter or bylaws or any legal
restriction, or any material agreement or instrument to which the Company is now
a party or by which it is bound, or result in the violation of any law, rule,
regulation, order, judgment or decree to which the Company or its property is
subject. The execution, delivery and performance by the Company of this
Agreement have been duly authorized by all necessary corporate action on part of
the Company. This Agreement has been duly executed and delivered by the Company,
and, upon the due authorization, execution and delivery by the Assignor and the
Assignee, will constitute the valid and legally binding obligation of the
Company, enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless of
whether enforceability is considered in a proceeding in equity or at law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be obtained
or made by the Company in connection with the execution, delivery or performance
by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency or other
tribunal, which would draw into question the validity of this Agreement or the
Purchase Agreement, or which, either in any one instance or in the aggregate,
would result in any material adverse change in the ability of the Company to
perform its obligations under this Agreement or the Purchase Agreement, and the
Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company hereby
represents and warrants, for the benefit of the Assignor, the Assignee and the
Trust, that the representations and warranties set forth in Section 9.02 of the
Purchase Agreement are true and correct as of the date hereof (or, with respect
to the Servicing Transfer Representations, the Transfer Date) as if such
representations and warranties were made on the date hereof unless otherwise
specifically stated in such representations and warranties.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies available
to the Assignor, the Assignee and the Trust (including the Trustee and the
Servicer acting on the Trust's behalf) in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3 and 4
hereof shall be as set forth in Subsection 9.03 of the Purchase Agreement as if
they were set forth herein (including without limitation the repurchase and
indemnity obligations set forth therein).
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of the
State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced, with the prior written
consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf). Any entity into which Assignor, Assignee
or Company may be merged or consolidated shall, without the requirement for any
further writing, be deemed Assignor, Assignee or Company, respectively,
hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with any
provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
Exhibit J
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
FIRST HORIZON
HOME LOAN CORPORATION
By: ____________________________________
Name:_______________________________
Its:________________________________
IXIS REAL ESTATE CAPITAL INC.
By: ____________________________________
Name:_______________________________
Its:________________________________
By: ____________________________________
Name:_______________________________
Its:________________________________
[__________________________]
By: ____________________________________
Name:_______________________________
Its:________________________________
Exhibit J
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
Exhibit K
EXHIBIT K
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"), dated as of
[_______], 200_, among/between IXIS Real Estate Capital Inc., a New York
corporation ("IXIS"), First Horizon Home Loan Corporation, a Kansas corporation
(the "Seller") and [_____________], a [_______________] [(the "Initial
Servicer")].
WHEREAS, [________________] (the "Depositor"), is acting as depositor
and registrant with respect to the Prospectus, dated [________________], and
the Prospectus Supplement to the Prospectus, [________________] (the
"Prospectus Supplement"), relating to [________________] Certificates (the
"Certificates") to be issued pursuant to a Pooling and Servicing Agreement,
dated as of [________________] (the "P&S"), among the Depositor, as
depositor, [________________], as servicer (the "Servicer"), and
[________________], as trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S, and
[____________________] (the "Underwriter[s]") to enter into the Underwriting
Agreement, dated [____________________] (the "Underwriting Agreement") between
the Depositor and the Underwriter[s], Seller has agreed to provide for
indemnification and contribution on the terms and conditions hereinafter set
forth;
WHEREAS, IXIS purchased from Seller certain of the Mortgage Loans
underlying the Certificates (the "Mortgage Loans") from Seller pursuant to a
Second Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of July 1, 2006 (the "Purchase Agreement"), by and between IXIS and
Seller; and
WHEREAS, pursuant to Section 13 of the Purchase Agreement, Seller has
agreed to indemnify IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents.
NOW THEREFORE, in consideration of the agreements contained herein, and
other valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Seller and IXIS agree as follows:
1. Indemnification and Contribution.
(a) Seller [and Initial Servicer] agrees to indemnify and hold harmless
IXIS, the Depositor, the Underwriter[s] and their respective affiliates, present
and former directors, officers, employees and agents and each person, if any,
who controls IXIS, the Depositor, the Underwriter[s] or such affiliate within
the meaning of either Section 15 of the Securities Act of 1933, as amended (the
"1933 Act"), or Section 20 of the Securities Exchange Act of 1934, as amended
(the "1934 Act"), against any and all losses, claims, damages or liabilities,
joint or several, to which they or any of them may become subject under the 1933
Act, the 1934 Act or other federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based in whole or in part
upon (i) any violation of the representation and warranty set forth in Section
2(vii) below or (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus or any omission or
alleged omission to state in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus 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, or any such
untrue statement or omission or alleged untrue statement or alleged omission
made in any amendment of or supplement to the Prospectus Supplement , ABS
Informational and Computational Material or the Free Writing Prospectus and
agrees to reimburse IXIS, the Depositor, the Underwriter[s] or such affiliates
and each such officer, director, employee, agent and controlling person promptly
upon demand for any legal or other expenses reasonably incurred by any of them
in connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that Seller [and Initial Servicer] shall be liable in any
such case only to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with the Seller Information [and Servicer Information]. The foregoing
indemnity agreement is in addition to any liability which Seller [and the
Initial Servicer] may otherwise have to IXIS, the Depositor, the Underwriter[s]
its affiliates or any such director, officer, employee, agent or controlling
person of IXIS, the Depositor, the Underwriter[s] or their respective
affiliates.
As used herein:
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act and
the 1934 Act, as amended from time to time.
"Free Writing Prospectus" means any written communication that constitutes
a "free writing prospectus," as defined in Rule 405 under the 1933 Act.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or
by the staff of the Commission, or as may be provided by the Commission or its
staff from time to time.
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines [and/or servicing guidelines]
relating to the Mortgage Loans set forth in the Prospectus Supplement , ABS
Informational and Computational Material or the Free Writing Prospectus [and
static pool information regarding mortgage loans originated or acquired by the
Seller [and included in the Prospectus Supplement, ABS Informational and
Computational Material, the Offering Circular or the Free Writing Prospectus]
[incorporated by reference from the website located at
[______________]].
["Servicer Information" means any information relating to Initial
Servicer, the Mortgage Loans and/or the servicing guidelines relating to the
Mortgage Loans set forth in the Prospectus Supplement , ABS Informational and
Computational Material or the Free Writing Prospectus [and static pool
information regarding mortgage loans originated or acquired by the Initial
Servicer [and included in the Prospectus Supplement, the Offering Circular ,
ABS Informational and Computational Material or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].]
(b) Promptly after receipt by any indemnified party under this Section 1
of notice of any claim or the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against any indemnifying
party under this Section 1, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify an indemnifying party shall not relieve it from any liability which it
may have under this Section 1 except to the extent it has been materially
prejudiced by such failure; and provided, further, however, that the failure to
notify any indemnifying party shall not relieve it from any liability which it
may have to any indemnified party otherwise than under this Section 1.
If any such claim or action shall be brought against an indemnified party,
and it shall notify the indemnifying party thereof, the indemnifying party shall
be entitled to participate therein and, to the extent that it wishes, jointly
with any other similarly notified indemnifying party, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party. After
notice from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, except as provided in the following
paragraph, the indemnifying party shall not be liable to the indemnified party
under this Section 1 for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof other than
reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel in
any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties.
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for reasonable fees and expenses of counsel, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than thirty (30)
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement.
(c) If the indemnification provided for in this Section 1 is unavailable
to an indemnified party, then the indemnifying party, in lieu of indemnifying
such indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities, in
such proportion as is appropriate to reflect the relative fault of the
indemnifying party and the indemnified party, respectively, in connection with
the statements or omissions that result in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the indemnified party and indemnifying party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission and any other equitable considerations.
(d) The indemnity and contribution agreements contained in this Section 1
and the representations and warranties set forth in Section 2 shall remain
operative and in full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by IXIS, the Depositor, the
Underwriter[s] their respective affiliates, directors, officers, employees or
agents or any person controlling IXIS, the Depositor, the Underwriter[s] or any
such affiliate and (iii) acceptance of and payment for any of the Offered
Certificates.
2. Representations and Warranties. Seller [and Initial Servicer]
represents and warrants that:
(i) Seller [and Initial Servicer] is validly existing and in good standing
under the laws of its jurisdiction of formation or incorporation, as
applicable, and has full power and authority to own its assets and to
transact the business in which it is currently engaged. Seller [and Initial
Servicer] is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the business transacted by it or any
properties owned or leased by it requires such qualification and in which the
failure so to qualify would have a material adverse effect on the business,
properties, assets or condition (financial or otherwise) of Seller [and
Initial Servicer];
(ii) Seller [and Initial Servicer] is not required to obtain the consent
of any other person or any consent, license, approval or authorization from,
or registration or declaration with, any governmental authority, bureau or
agency in connection with the execution, delivery, performance, validity or
enforceability of this Agreement;
(iii) the execution, delivery and performance of this Agreement by Seller
[and Initial Servicer] will not violate any provision of any existing law or
regulation or any order decree of any court applicable to Seller [and Initial
Servicer] or any provision of the charter or bylaws of Seller [and Initial
Servicer], or constitute a material breach of any mortgage, indenture,
contract or other agreement to which Seller [and Initial Servicer] is a party
or by which it may be bound;
(iv) (a) no proceeding of or before any court, tribunal or governmental
body is currently pending or, (b) to the knowledge of Seller [and Initial
Servicer], threatened against Seller [and Initial Servicer] or any of its
properties or with respect to this Agreement or the Offered Certificates, in
either case, which would have a material adverse effect on the business,
properties, assets or condition (financial or otherwise) of Seller [and
Initial Servicer];
(v) Seller [and Initial Servicer] has full power and authority to make,
execute, deliver and perform this Agreement and all of the transactions
contemplated hereunder, and has taken all necessary corporate action to
authorize the execution, delivery and performance of this Agreement. When
executed and delivered, this Agreement will constitute the legal, valid and
binding obligation of each of Seller [and Initial Servicer] enforceable in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally, by the availability
of equitable remedies, and by limitations of public policy under applicable
securities law as to rights of indemnity and contribution thereunder;
(vi) this Agreement has been duly executed and delivered by Seller [and
Initial Servicer]; and
(viii) the [Seller Information] [Servicer Information] satisfies the
requirements of the applicable provisions of Regulation AB.
3. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to Seller [and Initial Servicer], will be mailed,
delivered or telegraphed and confirmed [______________________]; or, if sent to
IXIS, will be mailed, delivered or telegraphed and confirmed to IXIS Real Estate
Capital Inc., 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General
Counsel.
4. Miscellaneous. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York without giving effect to the
conflict of laws provisions thereof. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their successors and assigns and
the controlling persons referred to herein, and no other person shall have any
right or obligation hereunder. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against whom enforcement of the change, waiver,
discharge or termination is sought. This Agreement may be executed in
counterparts, each of which when so executed and delivered shall be considered
an original, and all such counterparts shall constitute one and the same
instrument. Capitalized terms used but not defined herein shall have the
meanings provided in the P&S.
[Remainder of Page Intentionally Left Blank]
Exhibit K
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers hereunto duly authorized, this
__th day of [_____________].
IXIS REAL ESTATE CAPITAL INC.
By:
_____________________________________
Name:
Title:
By:
_____________________________________
Name:
Title:
FIRST HORIZON
HOME LOAN CORPORATION
By:
_____________________________________
Name:
Title:
[INITIAL SERVICER]
By:
_____________________________________
Name:
Title:
EXHIBIT EE
FIRST NLC AGREEMENTS
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated April 30, 2007
("Agreement"), among Natixis Real Estate Capital Inc. ("Assignor"), Xxxxxx
Xxxxxxx ABS Capital I Inc. ("Assignee") and First NLC Financial Services, LLC
(the "Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and
other valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Third Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of May 1, 2006, between the Assignor, as purchaser (the
"Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the
Assignee hereunder (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 Purchase Agreement which are not the Mortgage Loans set forth on the
Mortgage Loan Schedule and are not the subject of this Agreement or (ii) the
rights of the Purchaser (a) under Subsection 9.04 of the Purchase Agreement or
(b) to any premium recapture (i.e., the excess, if any, of the purchase price
percentage over par) in connection with any repurchase pursuant to Subsections
9.03 and 9.05 of the Purchase Agreement or (iii) any right to require the
Company to repurchase a Mortgage Loan pursuant to Subsection 9.05(b) of the
Purchase Agreement unless the related Mortgagor is delinquent with respect to
such Mortgage Loan's first Monthly Payment after origination.
Recognition of the Company
2. 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 Purchase Agreement
(solely to the extent set forth herein) and this Agreement to Natixis Real
Estate Capital Trust 2007-HE2 (the "Trust") created pursuant to a Pooling and
Servicing Agreement, dated as of April 1, 2007 (the "Pooling Agreement"), among
the Assignee, the Assignor, Deutsche Bank National Trust Company, as trustee (in
such capacity, including its successors in interest and any successor trustees
under the Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National
Association, as securities administrator (in such capacity, including its
successors in interest and any successor securities administrators under the
Pooling Agreement, the "Securities Administrator"), master servicer (in such
capacity, including its successors in interest and any successor master
servicers under the Pooling Agreement, the "Master Servicer") and Saxon Mortgage
Services, Inc., as servicer (including its successors in interest and any
successor servicer under the Pooling Agreement, the "Servicer"). The Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the enforcement of the representations, warranties and covenants with
respect to the Mortgage Loans, (iii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) shall have all the rights and remedies available to the Assignor,
insofar as they relate to the Mortgage Loans, under the Purchase Agreement,
including, without limitation, the enforcement of the document delivery
requirements set forth in Section 6 of the Purchase Agreement, and shall be
entitled to enforce all of the obligations of the Company thereunder insofar as
they relate to the Mortgage Loans, and (iv) all references to the Purchaser
(insofar as they relate to the rights, title and interest and, with respect to
obligations of the Purchaser, only insofar as they relate to the enforcement of
the representations, warranties and covenants of the Company), the Custodian or
the Bailee under the Purchase Agreement insofar as they relate to the Mortgage
Loans, shall be deemed to refer to the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf).
Neither the Company nor the Assignor shall amend or agree to amend, modify,
waiver, or otherwise alter any of the terms or provisions of the Purchase
Agreement which amendment, modification, waiver or other alteration would in any
way affect the Mortgage Loans or the Company's performance under the Purchase
Agreement with respect to the Mortgage Loans without the prior written consent
of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf) as of the date hereof that:
(a) The Company is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute,
deliver and perform its obligations under this Agreement and has full power
and authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(c) No consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is
required to be obtained or made by the Company in connection with the
execution, delivery or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation
pending or threatened against the Company, before any court, administrative
agency or other tribunal, which would draw into question the validity of
this Agreement or the Purchase Agreement, or which, either in any one
instance or in the aggregate, would result in any material adverse change
in the ability of the Company to perform its obligations under this
Agreement or the Purchase Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf), that the representations and
warranties set forth in Section 9.02 of the Purchase Agreement are true and
correct as of the date hereof as if such representations and warranties were
made on the date hereof unless (i) otherwise specifically stated in such
representations and warranties or (ii) with respect to the clause "nor has any
payment under the Mortgage Loan been 30 days or more delinquent at any time
since the origination of the Mortgage Loan" in the next to the last sentence of
(b), the last sentence of (b), the first sentence of (c), (d), (e), the last
sentence of (f), (h), the last sentence of (i), (m), (n), the last sentence of
(p), (q), (r), the third and fourth sentences of (w), (x), (z), (hh), (ii),
(kk), (ll), (mm), (rr), (xx), (bbb) and (kkk), such representations and
warranties are true and correct as of the related Transfer Date (as defined in
the Purchase Agreement).
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) in connection with any breach of the representations and warranties made
by the Company set forth in Sections 3 and 4 hereof shall be as set forth in
Subsection 9.03 of the Purchase Agreement as if they were set forth herein
(including without limitation the repurchase and indemnity obligations set forth
therein); provided, however, that the Assignor specifically reserves and does
not assign to the Assignee hereunder any and all right, title and interest in
the Premium Percentage, if any, due in connection with the repurchase of a
Mortgage Loan pursuant to Subsections 9.03, 9.04 and 9.05, or any right to
require the Company to repurchase a Mortgage Loan pursuant to Subsection 9.05(b)
of the Purchase Agreement unless the related Mortgagor is delinquent with
respect to such Mortgage Loan's first Monthly Payment after origination.
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors
and assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf). Any entity into which Assignor, Assignee or Company may be merged or
consolidated shall, without the requirement for any further writing, be deemed
Assignor, Assignee or Company, respectively, hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive
the conveyance of the Mortgage Loans and the assignment of the Purchase
Agreement (to the extent assigned hereunder) by Assignor to Assignee and by
Assignee to the Trust and nothing contained herein shall supersede or amend the
terms of the Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
FIRST NLC FINANCIAL SERVICES, LLC
By: /s/Xxxxxx Xxxxxxx
------------------------------
Name: Xxxxxx Xxxxxxx
Its: Sr. Vice Pres.
NATIXIS REAL ESTATE CAPITAL INC.
By: /s/Xxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxx Xxxxxxx
Its: Managing Director
By: /s/Xxxxxxxxxxx Xxxxxx
------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/Xxxxxxx Xxx
------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
================================================================================
THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE
AND WARRANTIES AGREEMENT
----------
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
FIRST NLC FINANCIAL SERVICES, LLC,
Seller
----------
Dated as of May 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
================================================================================
TABLE OF CONTENTS
SECTION 1 DEFINITIONS......................................................
SECTION 2 AGREEMENT TO PURCHASE............................................
SECTION 3 MORTGAGE SCHEDULES...............................................
SECTION 4 PURCHASE PRICE...................................................
SECTION 5 EXAMINATION OF MORTGAGE FILES....................................
SECTION 6 CONVEYANCE FROM SELLER TO PURCHASER..............................
Subsection 6.01 Conveyance of Mortgage
Loans; Possession of
Servicing Files...........................................
Subsection 6.02 Books and Records.........................................
Subsection 6.03 Delivery of Mortgage Loan
Documents.................................................
Subsection 6.04 Quality Control Procedures................................
Subsection 6.05 MERS Designated Mortgage
Loans.....................................................
SECTION 7 SERVICING OF THE MORTGAGE LOANS..................................
SECTION 8 TRANSFER OF SERVICING............................................
SECTION 9 REPRESENTATIONS, WARRANTIES AND
COVENANTS OF THE SELLER; REMEDIES
FOR BREACH.......................................................
Subsection 9.01 Representations and
Warranties Regarding the
Seller....................................................
Subsection 9.02 Representations and
Warranties Regarding
Individual Mortgage Loans.................................
Subsection 9.03 Remedies for Breach of
Representations and
Warranties................................................
Subsection 9.04 Repurchase of Mortgage
Loans That Prepay in Full.................................
Subsection 9.05 Repurchase of Mortgage
Loans with First Payment
Defaults..................................................
SECTION 10 CLOSING..........................................................
SECTION 11 CLOSING DOCUMENTS................................................
SECTION 12 COSTS............................................................
SECTION 13 COOPERATION OF SELLER WITH A
RECONSTITUTION...................................................
SECTION 14 THE SELLER.......................................................
Subsection 14.01 Additional Indemnification
by the Seller; Third Party
Claims....................................................
Subsection 14.02 Merger or Consolidation of
the Seller................................................
SECTION 15 FINANCIAL STATEMENTS.............................................
SECTION 16 MANDATORY DELIVERY; GRANT OF
SECURITY INTEREST................................................
SECTION 17 NOTICES..........................................................
SECTION 18 SEVERABILITY CLAUSE..............................................
SECTION 19 COUNTERPARTS.....................................................
SECTION 20 GOVERNING LAW JURISDICTION;
CONSENT TO SERVICE OF PROCESS....................................
SECTION 21 INTENTION OF THE PARTIES.........................................
SECTION 22 SUCCESSORS AND ASSIGNS; ASSIGNMENT
OF PURCHASE AGREEMENT............................................
SECTION 23 WAIVERS..........................................................
SECTION 24 EXHIBITS.........................................................
SECTION 25 GENERAL INTERPRETIVE PRINCIPLES..................................
SECTION 26 REPRODUCTION OF DOCUMENTS........................................
SECTION 27 FURTHER AGREEMENTS...............................................
SECTION 28 RECORDATION OF ASSIGNMENTS OF
MORTGAGE.........................................................
SECTION 29 NO SOLICITATION..................................................
SECTION 30 WAIVER OF TRIAL BY JURY..........................................
SECTION 31 COMPLIANCE WITH REGULATION AB....................................
Subsection 31.01 Intent of the Parties;
Reasonableness............................................
Subsection 31.02 Additional Representations
and Warranties of the Seller..............................
Subsection 31.03 Information to Be Provided
by the Seller.............................................
Subsection 31.04 Indemnification; Remedies.................................
EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF INTERIM SERVICING AGREEMENT
EXHIBIT C FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE INTERIM SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G [RESERVED]
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I SELLER'S UNDERWRITING GUIDELINES
EXHIBIT J FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT K FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES AGREEMENT
This THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT (the "Agreement"), dated as of May 1, 2006, between IXIS
Real Estate Capital Inc., a New York corporation, having an office at 0 Xxxx
00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Purchaser"), and First
NLC Financial Services, LLC, a Florida limited liability company, having an
office at 000 Xxxx Xxxxxxxxx Xxxxxxxxx, Xxxxxxxx Xxx, Xxxxxxxxx Xxxxx, Xxxxxxx
(the "Seller").
W I T N E S S E T H:
WHEREAS, the Purchaser and the Seller are parties to that certain
Second Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of November 1, 2005 (the "Original Agreement"), between the Purchaser
and the Seller.
WHEREAS, at the present time, the Purchaser and the Seller desire to
amend the Original Agreement to make certain modifications as set forth herein
with respect to all Mortgage Loans acquired pursuant to this Agreement or the
Original Agreement.
NOW, THEREFORE, in consideration of the premises and mutual
agreements set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Purchaser and the
Seller agree as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms shall
have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan,
those mortgage servicing practices of prudent mortgage lending institutions
which service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac Transfer.
Agreement: This Mortgage Loan Purchase and Warranties Agreement
and all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value
of the related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property at such time of origination, whichever is less; provided,
however, that in the case of a refinanced Mortgage Loan, such value is based
solely upon the appraisal made, if any, at the time of origination of such
refinanced Mortgage Loan, and (ii) with respect to any Second Lien Loan, the
value, determined pursuant to the Seller's Underwriting Guidelines, of the
related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in
Subsection 6.01.
Assignment of Mortgage: An 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
the sale of the Mortgage to the Purchaser.
Balloon Mortgage Loan: Any Mortgage Loan that requires only payments
of interest until the stated maturity date of the Mortgage Loan or the Monthly
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by stated maturity date of the Mortgage
Loan.
Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a
day on which banking and savings and loan institutions, in the State of New York
or the state in which the Interim Servicer's servicing operations are located,
are authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to
time shall purchase and the Seller from time to time shall sell the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value and (2) any First Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the First Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are junior or equal in
priority to the First Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created and
maintained pursuant to Section 2.04 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, dated as of October 14, 2002, between the Purchaser and
the Custodian.
Custodian: The custodian under the Custodial Agreement, or its
successor in interest or assigns, or any successor to the Custodian under the
Custodial Agreement, as therein provided. If at any time there is no Custodial
Agreement in effect with respect to a Mortgage Loan, all references to the
Custodian herein and in the Interim Servicing Agreement shall be deemed to refer
to the Purchaser (or its designee) with respect to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Deemed Material Breach Representation: Each representation
identified as such in Subsection 9.02.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or
replaced or to be replaced with a Qualified Substitute Mortgage Loan by the
Seller in accordance with the terms of this Agreement.
Delinquency Collection Policies and Procedures: The delinquency
collection policies and procedures of the Seller, a copy of which is attached to
the Interim Servicing Agreement.
Delinquent: A Mortgage Loan in which the Monthly Payment has not
been received by the date that is one day prior to the Due Date occurring in the
immediately succeeding month (i.e. if Monthly Payment due on September 1 is not
received prior to October 1, such Mortgage Loan would be Delinquent).
Depositor: The depositor, as such term is defined in
Regulation AB, with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is
due on a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term unsecured
debt obligations of which (or, in the case of a depository institution or trust
company that is a subsidiary of a holding company, the short-term unsecured debt
obligations of such holding company) are rated A-1 by Standard & Poor's or
Prime-1 by Moody's (or a comparable rating if another Rating Agency is specified
by the Purchaser by written notice to the Seller) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, or (iii) a trust account or accounts maintained with
a federal or state chartered depository institution or trust company acting in
its fiduciary capacity.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
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.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Xxxxxx Mae: The Federal National Mortgage Association and its
successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx
Xxx Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 13 hereof.
FDIC: The Federal Deposit Insurance Corporation and its
successors in interest.
FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage
on the related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
Fixed Rate Mortgage Loan: A fixed rate mortgage loan purchased
pursuant to this Agreement.
Xxxxxxx Mac: The Federal Home Loan Mortgage Corporation and its
successors in interest.
Xxxxxxx Mac Transfer: As defined in Section 13 hereof.
GEMICO: General Electric Mortgage Insurance Corporation, a North
Carolina corporation and its successors in interest.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan,
the fixed percentage amount set forth in the related Mortgage Note which amount
is added to the Index in accordance with the terms of the related Mortgage Note
to determine on each Interest Rate Adjustment Date the Mortgage Interest Rate
for such Mortgage Loan.
High Cost Loan: A Mortgage Loan (a) covered by the Home Ownership
and Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual percentage
rate" or total "points and fees" payable by the related Mortgagor (as each such
term is calculated under HOEPA) that exceed the thresholds set forth by HOEPA
and its implementing regulations, including 12 C.F.R. ss. 226.32(a)(1)(i) and
(ii), (c) classified as a "high cost home," "threshold," "covered," "high risk
home," "predatory" or similar loan under any other 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) or
(d) a Mortgage Loan categorized as High Cost pursuant to Appendix E of Standard
& Poor's Glossary. For avoidance of doubt, the parties agree that this
definition shall apply to any law regardless of whether such law is presently,
or in the future becomes, the subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also deemed to include subdivisions thereof such as the FHA
and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, a rate
per annum set forth on Exhibit B to each related Assignment and Conveyance
Agreement.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan,
the Person named on the MERS(R) System as the interim funder pursuant to the
MERS Procedures Manual.
Interim Servicer: First NLC Financial Services, LLC, a Florida
limited liability company and its successors in interest, and any successor
interim servicer under the Interim Servicing Agreement.
Interim Servicing Agreement: The Second Amended and Restated Interim
Servicing Agreement, dated as of November 1, 2005 by and between the Purchaser
and the Interim Servicer, providing for the Interim Servicer to service the
Mortgage Loans for an interim period as specified therein.
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the investor pursuant to the MERS
Procedures Manual.
Lifetime Rate Cap: The provision of each Mortgage Note related to an
Adjustable Rate Mortgage Loan which provides for an absolute maximum Mortgage
Interest Rate thereunder. The Mortgage Interest Rate during the terms of each
Adjustable Rate Mortgage Loan shall not at any time exceed the Mortgage Interest
Rate at the time of origination of such Adjustable Rate Mortgage Loan by more
than the amount per annum set forth on the related Mortgage Loan Schedule.
Liquidation Proceeds: Cash received in connection with the
liquidation of a defaulted Mortgage Loan, whether through the sale or assignment
of such Mortgage Loan, trustee's sale, foreclosure sale or otherwise, or the
sale of the related Mortgaged Property if the Mortgaged Property is acquired in
satisfaction of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the outstanding principal amount of the
Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
Appraised Value of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the
Seller has designated or will designate MERS as, and has taken or will take such
action as is necessary to cause MERS to be, the mortgagee of record, as nominee
for the Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor on the MERS(R)
System.
MERS Procedure Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
Moody's: Xxxxx'x Investors Service, Inc. and its successors in
interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on the Mortgaged Property.
Mortgage File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit A annexed hereto, and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: The annual rate of interest borne on a
Mortgage Note with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, 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 required to be delivered to
the Custodian pursuant to Section 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting forth
the following information with respect to each Mortgage Loan in the related
Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying number; (2)
the Mortgagor's 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 investment property; (5) the number
and type of residential units constituting the Mortgaged Property (i.e., a
single family residence, a 2-4 family residence, a unit in a condominium project
or a unit in a planned unit development, manufactured housing); (6) the Mortgage
Loan origination date; (7) the original months to maturity or the remaining
months to maturity from the related Cut-off Date, in any case 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 Loan-to-Value
Ratio at origination; (9) with respect to First Lien Loans, the LTV and with
respect to Second Lien Loans, the CLTV; (10) the Mortgage Interest Rate as of
the related Cut-off Date; (11) the date on which the Monthly Payment was due on
the Mortgage Loan and, if such date is not consistent with the Due Date
currently in effect, such Due Date; (12) the stated maturity date; (13) the
amount of the Monthly Payment as of the related Cut-off Date; (14) the last
payment date as of which a payment was actually applied to the outstanding
principal balance; (15) the original principal amount of the Mortgage Loan; (16)
the 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 and collected
on or before the Cut-off Date; (17) the Interest Rate Adjustment Date; (18) the
Gross Margin; (19) the Lifetime Rate Cap under the terms of the Mortgage Note;
(20) a code indicating the type of Index; (21) the Mortgage Interest Rate as of
origination; (22) the type of Mortgage Loan (i.e., fixed-rate, adjustable-rate,
First Lien, Second Lien); (23) a code indicating the purpose of the loan (i.e.,
purchase, rate and term refinance, equity take-out refinance); (24) a code
indicating the documentation style (i.e., full or stated income); (25) the loan
credit classification (as described in the Underwriting Guidelines); (26) the
applicable Cut-off Date; (27) the applicable Closing Date; (28) a code
indicating the type of prepayment penalty, if any; (29) a code indicating
whether the Mortgage Loan is a Home Loan; (30) the credit risk score (FICO
score); (31) with respect to the related Mortgagor, the debt-to-income ratio;
(32) with respect to Second Lien Loans, the outstanding principal balance of the
superior lien; (33) the Appraised Value of the Mortgaged Property; (34) the sale
price of the Mortgaged Property if the Mortgage Loan was originated in
connection with the purchase of the Mortgaged Property; (35) the Periodic Rate
Cap under the terms of the Mortgage Note; (36) the Periodic Rate Floor under the
terms of the Mortgage Note; (37) whether such Mortgage Loan provides for a
prepayment penalty; (38) the prepayment penalty period of such Mortgage Loan, if
applicable; (39) a description of the type of prepayment penalty, if applicable;
(40) the MERS Identification Number; (41) whether the Mortgagor represented that
the Mortgagor would occupy the Mortgaged Property as its primary residence and
(42) a code indicating if the Mortgage Loan is a Balloon Mortgage Loan. With
respect to the Mortgage Loans in the aggregate, the Mortgage Loan Schedule shall
set forth the following information, as of the related Cut-off Date: (1) the
number of Mortgage Loans; (2) the current aggregate outstanding principal
balance of the Mortgage Loans; (3) the weighted average Mortgage Interest Rate
of the Mortgage Loans; and (4) the weighted average maturity of the Mortgage
Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the
Mortgagor's real property securing repayment of a related Mortgage Note,
consisting of an unsubordinated estate in fee simple or, 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, in a
single parcel or multiple parcels of real property improved by a residential
dwelling as further described in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its successors
in interest.
Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or a Vice President and
by the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of the Seller, and delivered to the Purchaser as required
by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Seller, reasonably acceptable to the Purchaser, provided that any
Opinion of Counsel relating to (a) the qualification of any account required to
be maintained pursuant to this Agreement as an Eligible Account, (b)
qualification of the Mortgage Loans in a REMIC or (c) compliance with the REMIC
Provisions, must be (unless otherwise stated in such Opinion of Counsel) an
opinion of counsel who (i) is in fact independent of the Seller and any servicer
of the Mortgage Loans, (ii) does not have any material direct or indirect
financial interest in the Seller or any servicer of the Mortgage Loans or in an
Affiliate of either and (iii) is not connected with the Seller or any servicer
of the Mortgage Loans as an officer, employee, director or person performing
similar functions.
OTS: Office of Thrift Supervision and its successors in interest.
Periodic Rate Cap: With respect to each Adjustable Rate Mortgage
Loan, the provision of each Mortgage Note which provides for an absolute maximum
amount by which the Mortgage Interest Rate therein may increase on an Interest
Rate Adjustment Date above the Mortgage Interest Rate previously in effect.
Periodic Rate Floor: With respect to each Adjustable Rate Mortgage
Loan, the provision of each Mortgage Note which provides for an absolute maximum
amount by which the Mortgage Interest Rate therein may decrease on an Interest
Rate Adjustment Date below the Mortgage Interest Rate previously in effect.
Person: Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof.
Preliminary Mortgage Schedule: As defined in Section 3.
Premium Percentage: With respect to any Mortgage Loan, a
percentage equal to the excess of the Purchase Price Percentage over 100%.
Principal Prepayment: Any payment or other recovery of principal on
a Mortgage Loan which is received in advance of its scheduled Due Date,
including any prepayment penalty or premium thereon and which is not accompanied
by an amount of interest representing scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements setting
forth the general terms and conditions of the transaction consummated herein and
identifying the Mortgage Loans to be purchased from time to time hereunder, by
and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an
amount equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York corporation,
and its successors in interest or assigns or any successor to the Purchaser
under this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Seller and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Seller, in accordance with underwriting
guidelines designated by the Seller ("Designated Guidelines") or guidelines that
do not vary materially from such Designated Guidelines; (ii) such Mortgage Loans
were in fact underwritten as described in clause (i) above and were acquired by
the Seller within 180 days after origination; (iii) either (x) the Designated
Guidelines were, at the time such Mortgage Loans were originated, used by the
Seller in origination of mortgage loans of the same type as the Mortgage Loans
for the Seller's own account or (y) the Designated Guidelines were, at the time
such Mortgage Loans were underwritten, designated by the Seller on a consistent
basis for use by lenders in originating mortgage loans to be purchased by the
Seller; and (iv) the Seller employed, at the time such Mortgage Loans were
acquired by the Seller, pre-purchase or post-purchase quality assurance
procedures (which may involve, among other things, review of a sample of
mortgage loans purchased during a particular time period or through particular
channels) designed to ensure that Persons from which it purchased mortgage loans
properly applied the underwriting criteria designated by the Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in
the Custodial Account by the Seller in the month of substitution); (ii) have a
Mortgage Interest Rate not less than and not more than 1% greater than the
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one year less than that of the
Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan
(i.e., fixed-rate, adjustable-rate with same Periodic Rate Cap, Index and lien
priority); and (v) comply with each representation and warranty (respecting
individual Mortgage Loans) set forth in Section 9 hereof.
Rating Agency: Any of Fitch, Moody's or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan
Transfer.
Reconstitution Agreements: The agreement or agreements entered into
by the Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 13, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement, pooling and servicing
agreement and/or seller/servicer agreements and related custodial/trust
agreement and documents with respect to a Securitization Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100 through 229.1123, as such may be
amended from time to time, and subject to such clarification and interpretation
as have been provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan.
7, 2005)) or by the staff of the Commission, or as may be provided by the
Commission or its staff from time to time.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating
to 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 date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Repurchase Price: With respect to any Mortgage Loan for which a
breach of a representation or warranty from the Agreement or the Interim
Servicing Agreement is found, a price equal to the then outstanding principal
balance of the Mortgage Loan to be repurchased, plus accrued interest thereon at
the Mortgage Interest Rate from the date to which interest had last been paid
through the date of such repurchase, plus the amount of any outstanding advances
owed to any servicer, and plus all costs and expenses incurred by the Purchaser
or any servicer arising out of or based upon such breach, including without
limitation costs and expenses incurred in the enforcement of the Seller's
repurchase obligation hereunder.
RESPA: Real Estate Settlement Procedures Act, as amended from time
to time.
Second Lien Loan: A Mortgage Loan secured by a second lien
Mortgage on the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction. Any transaction involving either (1) a
sale or other transfer of some or all of the Mortgage Loans directly or
indirectly to an issuing entity in connection with an issuance of publicly
offered or privately placed, rated or unrated mortgage-backed securities or (2)
an issuance of publicly offered or privately placed, rated or unrated
securities, the payments on which are determined primarily by reference to one
or more portfolios of residential mortgage loans consisting, in whole or in
part, of some or all of the Mortgage Loans.
Seller: First NLC Financial Services, LLC, a Florida limited
liability company, and its successors in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to the
Interim Servicing Agreement, an amount equal to 0.50% per annum computed on the
basis of the outstanding principal balance of the related Mortgage Loan. Such
fee shall be payable monthly and shall be pro rated for any portion of a month
during which the Mortgage Loan is serviced by the Interim Servicer under the
Interim Servicing Agreement. The obligation of the Purchaser to pay the
Servicing Fee is limited to, and the Servicing Fee is payable solely from, the
interest portion (including recoveries with respect to interest from Liquidation
Proceeds, to the extent permitted by this Agreement) of such Monthly Payment
collected by the Interim Servicer, or as otherwise provided under this
Agreement.
Servicing File: With respect to each Mortgage Loan, the file
retained by the Interim Servicer consisting of originals of all documents in the
Mortgage File which are not delivered to the Purchaser or the Custodian and
copies of the Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and all
rights to service the Mortgage Loans; (b) any payments to or monies received by
the Interim Servicer for servicing the Mortgage Loans; (c) any late fees,
penalties or similar payments with respect to the Mortgage Loans; (d) all
agreements or documents creating, defining or evidencing any such servicing
rights to the extent they relate to such servicing rights and all rights of the
Interim Servicer thereunder; (e) Escrow Payments or other similar payments with
respect to the Mortgage Loans and any amounts actually collected by the Interim
Servicer with respect thereto; (f) all accounts and other rights to payment
related to any of the property described in this paragraph; and (g) any and all
documents, files, records, servicing files, servicing documents, servicing
records, data tapes, computer records, or other information pertaining to the
Mortgage Loans or pertaining to the past, present or prospective servicing of
the Mortgage Loans.
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division
of The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R)
Glossary, as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as described in
Item 1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Sections 9.03 and 14.01.
Third-Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its designee,
shall receive the transfer of servicing responsibilities and begin to perform
the servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: The underwriting guidelines of the Seller,
a copy of which is attached hereto as Exhibit I and a then-current copy of which
shall be attached as an exhibit to the related Assignment and Conveyance.
VA: The Department of Veterans Affairs, an agency of the United
States of America, or any successor thereto including the Administrator of
Veterans Affairs.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser
agrees to purchase from time to time, Mortgage Loans having an aggregate
principal balance on the related Cut-off Date in an amount as set forth in the
related Purchase Price and Terms Agreement, or in such other amount as agreed by
the Purchaser and the Seller as evidenced by the actual aggregate principal
balance of the Mortgage Loans accepted by the Purchaser on each Closing Date.
SECTION 3. Mortgage Schedules.
The Seller from time to time shall provide the Purchaser with
certain information constituting a preliminary listing of the Mortgage Loans to
be purchased on each Closing Date in accordance with the related Purchase Price
and Terms Agreement and this Agreement (each, a "Preliminary Mortgage
Schedule").
The Seller shall deliver the Mortgage Loan Schedule for the Mortgage
Loans to be purchased on a particular Closing Date to the Purchaser at least two
(2) Business Days prior to the related Closing Date. The Mortgage Loan Schedule
shall be the related Preliminary Mortgage Schedule with those Mortgage Loans
which the Seller has not funded prior to the related Closing Date deleted.
SECTION 4. Purchase Price.
The Purchase Price for the Mortgage Loans shall be equal to (a) the
Purchase Price Percentage multiplied by the Cut-off Date Balance, plus (b)
accrued and unpaid interest on such principal balance at the weighted average
Mortgage Interest Rate (net of the Servicing Fee) of those Mortgage Loans from
the related Cut-off Date through the day prior to the related Closing Date,
inclusive. For purposes hereof, "Cut-off Date Balance" means the aggregate
principal balance, as of the related Cut-off Date, of the Mortgage Loans listed
on the related Mortgage Loan Schedule, after application of scheduled payments
of principal due on or before the related Cut-off Date, to the extent such
payments were actually received, together with any unscheduled principal
payments collected prior to the Cut-off Date; provided, however, that payments
of scheduled principal and interest paid prior to the Cut-off Date, but to be
applied on a due date beyond the related Cut-off Date, shall not be applied to
the principal balance as of the related Cut-off Date. If so provided in the
related Purchase Price and Terms Agreement, portions of the Mortgage Loans shall
be priced separately. The Purchase Price as so determined shall be paid to the
Seller on the related Closing Date by wire transfer of immediately available
funds to an account designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, 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, to the extent actually collected, together with any
unscheduled principal prepayments collected prior to the Cut-off Date; provided,
however, that payments of scheduled principal and interest paid prior to the
Cut-off date, but to be applied on 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 Seller 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
Seller to the Purchaser.
SECTION 5. Examination of Mortgage Files.
At least five (5) Business Days prior to the related Closing Date,
the Seller shall (i) either (a) deliver to the Purchaser or its designee in
escrow, for examination with respect to each Mortgage Loan to be purchased, the
related Mortgage File, including a copy of the Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), pertaining to each Mortgage
Loan, or (b) make the related Mortgage File available to the Purchaser for
examination at such other location as shall otherwise be acceptable to the
Purchaser and (ii) deliver to the Purchaser copies of the credit and servicing
files (collectively, the "Credit Files"). Such examination of the Mortgage Files
may be made by the Purchaser or its designee at any reasonable time before or
after the related Closing Date. If the Purchaser makes such examination prior to
the related Closing Date and determines, in its sole discretion, that any
Mortgage Loans are unacceptable to the Purchaser for any reason, such Mortgage
Loans shall be deleted from the related Mortgage Loan Schedule, and may be
replaced by a Qualified Substitute Mortgage Loan (or Loans) acceptable to the
Purchaser. The Purchaser may, at its option and without notice to the Seller,
purchase some or all of the Mortgage Loans without conducting any partial or
complete examination. The fact that the Purchaser or its designee has conducted
or has failed to conduct any partial or complete examination of the Mortgage
Files or the Credit Files shall not impair in any way the Purchaser's (or any of
its successor's) rights to demand repurchase, substitution or other remedy as
provided in this Agreement. In the event that the Seller fails to deliver the
Credit Files with respect to any Mortgage Loan, the Seller shall, upon the
request of the Purchaser, repurchase such Mortgage Loan at the price and in the
manner specified in Subsection 9.03.
SECTION 6. Conveyance from Seller to Purchaser.
Subsection 6.01 Conveyance of Mortgage Loans; Possession of
Servicing Files.
The Seller, simultaneously with the delivery of the Mortgage Loan
Schedule with respect to the related Mortgage Loan Package to be purchased on
each Closing Date, shall execute and deliver an Assignment and Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment and
Conveyance Agreement"). The Seller shall cause the Servicing File retained by
the Interim Servicer pursuant to this Agreement to be appropriately identified
in the Seller's computer system and/or books and records, as appropriate, to
clearly reflect the sale of the related Mortgage Loan to the Purchaser. The
Seller shall cause the Interim Servicer to release from its custody the contents
of any Servicing File retained by it only in accordance with this Agreement or
the Interim Servicing Agreement, except when such release is required in
connection with a repurchase of any such Mortgage Loan pursuant to Subsection
9.03.
Subsection 6.02 Books and Records.
Record title to each Mortgage as of the related Closing Date shall
be in the name of the Seller, the Purchaser or one or more designees of the
Purchaser, as the Purchaser shall select. Notwithstanding the foregoing, each
Mortgage and related Mortgage Note shall be possessed solely by the Purchaser or
the appropriate designee of the Purchaser, as the case may be. All rights
arising out of the Mortgage Loans including, but not limited to, all funds
received by the Seller or the Interim Servicer after the related Cut-off Date on
or in connection with a Mortgage Loan shall be vested in the Purchaser or one or
more designees of the Purchaser; provided, however, that all funds received on
or in connection with a Mortgage Loan shall be received and held by the Seller
or the Interim Servicer in trust for the benefit of the Purchaser or the
appropriate designee of the Purchaser, as the case may be, as the owner of the
Mortgage Loans pursuant to the terms of this Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to be
responsible for maintaining, and shall maintain, a complete set of books and
records for each Mortgage Loan which shall be marked clearly to reflect the
ownership of each Mortgage Loan by the Purchaser. In particular, the Seller
shall or shall cause the Interim Servicer to maintain in its possession,
available for inspection by the Purchaser, 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 Xxxxxxx Mac, including
but not limited to documentation as to the method used in determining the
applicability of the provisions of the National Flood Insurance Act of 1968, as
amended, to the Mortgaged Property, documentation evidencing insurance coverage
and periodic inspection reports, as required by the Xxxxxx Mae Guides. To the
extent that original documents are not required for purposes of realization of
Liquidation Proceeds or Insurance Proceeds, documents maintained by the Seller
or the Interim Servicer may be in the form of microfilm or microfiche so long as
the Seller or the Interim Servicer complies with the requirements of the Xxxxxx
Xxx Guides.
Subsection 6.03 Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later than
seven (7) Business Days prior to the related Closing Date those Mortgage Loan
Documents set forth on Exhibit A hereto with respect to each Mortgage Loan set
forth on the related Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian from and after the Closing Date.
The Seller shall or shall cause the Interim Servicer to forward to
the Custodian, or to such other Person as the Purchaser shall designate in
writing, original documents evidencing an assumption, modification,
consolidation or extension of any Mortgage Loan entered into in accordance with
this Agreement within two weeks of their execution, provided, however, that the
Seller shall provide the Custodian, or to such other Person as the Purchaser
shall designate in writing, with a certified true copy of any such document
submitted for recordation within two weeks of its execution, and shall promptly
provide the original of any document submitted for recordation or a copy of such
document certified by the appropriate public recording office to be a true and
complete copy of the original within ninety days of its submission for
recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within 90 days following the Closing Date (other
than with respect to the Assignments of Mortgage which shall be delivered to the
Custodian in blank and recorded subsequently by the Purchaser or its designee),
and in the event that the Seller does not cure such failure within 30 days of
discovery or receipt of written notification of such failure from the Purchaser,
the related Mortgage Loan shall, upon the request of the Purchaser, be
repurchased by the Seller at the price and in the manner specified in Subsection
9.03. The foregoing repurchase obligation shall not apply in the event that the
Seller cannot deliver such original or copy of any document submitted for
recordation to the appropriate public recording office within the specified
period due to a delay caused by the recording office in the applicable
jurisdiction, provided that (i) the Seller shall deliver a recording receipt of
such recording office or, if such recording receipt is not available, an
officer's certificate of a servicing officer of the Seller, confirming that such
documents have been accepted for recording (upon request of the Purchaser and
delivery by the Purchaser to the Seller of a schedule of the related Mortgage
Loans, the Seller shall reissue and deliver to the Purchaser or its designee
said officer's certificate relating to the related Mortgage Loans), and (ii)
such document is delivered within twelve (12) months of the related Closing
Date.
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee.
Subsection 6.04 Quality Control Procedures.
The Seller shall, or shall cause the Interim Servicer to, have an
internal quality control program that verifies in a manner consistent with
accepted industry procedures, on a regular basis, the existence and accuracy of
the legal documents, credit documents, property appraisals, and underwriting
decisions. The program shall include evaluating and monitoring the overall
quality of the Seller's loan production and the servicing activities of the
Interim Servicer. The program is to ensure that the Mortgage Loans are
originated and serviced in accordance with Accepted Servicing Practices and the
Underwriting Guidelines; guard against dishonest, fraudulent, or negligent acts;
and guard against errors and omissions by officers, employees, or other
authorized persons.
Subsection 6.05 MERS Designated Mortgage Loans.
With respect to each MERS Designated Mortgage Loan, the Seller
shall, on or prior to the related Closing Date, designate the Purchaser as the
Investor and the Custodian as custodian, and no Person shall be listed as
Interim Funder on the MERS System. In addition, on or prior to the related
Closing Date, Seller shall provide the Custodian and the Purchaser with a MERS
Report listing the Purchaser as the Investor, the Custodian as custodian and no
Person as Interim Funder with respect to each MERS Designated Mortgage Loan.
SECTION 7. Servicing of the Mortgage Loans.
The Mortgage Loans have been sold by the Seller to the Purchaser on
a servicing released basis. Subject to, and upon the terms and conditions of
this Agreement and the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Seller hereby
sells, transfers, assigns, conveys and delivers to the Purchaser the Servicing
Rights.
The Purchaser shall retain the Interim Servicer as contract servicer
of the Mortgage Loans for an interim period pursuant to and in accordance with
the terms and conditions contained in the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Except as set forth in the Interim Servicing Agreement, the Interim Servicer
shall service the Mortgage Loans on an "actual/actual" basis and otherwise in
strict compliance with the servicing provisions related to the Xxxxxx Mae MBS
Program (Special Servicing Option) of the Xxxxxx Xxx Guides (except as otherwise
set forth in the Interim Servicing Agreement). The Purchaser and Seller shall
cause the Interim Servicer to execute the Interim Servicing Agreement on the
initial Closing Date.
Pursuant to the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Interim
Servicer shall begin servicing the Mortgage Loans on behalf of the Purchaser and
shall be entitled to a Servicing Fee with respect to such Mortgage Loans until
the applicable Transfer Date. The Interim Servicer shall conduct such servicing
in accordance with the Interim Servicing Agreement.
SECTION 8. Transfer of Servicing.
On the applicable Transfer Date, the Purchaser, or its designee,
shall assume all servicing responsibilities related to, and the Seller shall
cause the Interim Servicer to cease all servicing responsibilities related to,
the related Mortgage Loans subject to such Transfer Date. The Transfer Date
shall be the date determined in accordance with Section 6.02 of the Interim
Servicing Agreement (with respect to each Mortgage Loan, for an interim period,
as specified therein).
On or prior to the applicable Transfer Date, the Seller shall, at
its sole cost and expense, take such steps as may be necessary or appropriate to
effectuate and evidence the transfer of the servicing of the related Mortgage
Loans to the Purchaser, or its designee, including but not limited to the
following:
(a) Notice to Mortgagors. The Seller shall cause the Interim
Servicer to mail to the Mortgagor of each related Mortgage Loan a letter
advising such Mortgagor of the transfer of the servicing of the related Mortgage
Loan to the Purchaser, or its designee, in accordance with the Xxxxxxxx Xxxxxxxx
National Affordable Housing Act of 1990; provided, however, the content and
format of the letter shall have the prior approval of the Purchaser. The Seller
shall cause the Interim Servicer to provide the Purchaser with copies of all
such related notices no later than the Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The Seller
shall cause the Interim Servicer to transmit to the applicable taxing
authorities and insurance companies (including primary mortgage insurance policy
insurers, if applicable) and/or agents, notification of the transfer of the
servicing to the Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may be, to the
Purchaser from and after the Transfer Date. The Seller shall cause the Interim
Servicer to provide the Purchaser with copies of all such notices no later than
the Transfer Date.
(c) Delivery of Servicing Records. The Seller shall cause the
Interim Servicer to forward to the Purchaser, or its designee, all servicing
records and the Servicing File in the Interim Servicer's possession relating to
each related Mortgage Loan including the information enumerated in the Interim
Servicing Agreement (with respect to each such Mortgage Loan, for an interim
period, as specified therein).
(d) Escrow Payments. The Seller shall cause the Interim Servicer to
provide the Purchaser, or its designee, with immediately available funds by wire
transfer in the amount of the net Escrow Payments and suspense balances and all
loss draft balances associated with the related Mortgage Loans. The Seller shall
cause the Interim Servicer to provide the Purchaser with an accounting
statement, in electronic format acceptable to the Purchaser in its sole
discretion, of Escrow Payments and suspense balances and loss draft balances
sufficient to enable the Purchaser to reconcile the amount of such payment with
the accounts of the Mortgage Loans. Additionally, the Seller shall cause the
Interim Servicer to wire transfer to the Purchaser the amount of any agency,
trustee or prepaid Mortgage Loan payments and all other similar amounts held by
the Interim Servicer.
(e) Payoffs and Assumptions. The Seller shall cause the Interim
Servicer to provide to the Purchaser, or its designee, copies of all assumption
and payoff statements generated by the Interim Servicer on the related Mortgage
Loans from the related Cut-off Date to the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Interim Servicer or the Seller on
each related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of
any related Monthly Payments received by the Seller after the Transfer Date
shall be forwarded to the Purchaser by overnight mail on the date of receipt.
The Seller shall notify the Purchaser of the particulars of the payment, which
notification requirement shall be satisfied if the Seller forwards with its
payment sufficient information to permit appropriate processing of the payment
by the Purchaser. The Seller shall assume full responsibility for the necessary
and appropriate legal application of such Monthly Payments received by the
Seller after the Transfer Date with respect to related Mortgage Loans then in
foreclosure or bankruptcy; provided, for purposes of this Agreement, necessary
and appropriate legal application of such Monthly Payments shall include, but
not be limited to, endorsement of a Monthly Payment to the Purchaser with the
particulars of the payment such as the account number, dollar amount, date
received and any special Mortgagor application instructions and the Seller shall
cause the Interim Servicer to comply with the foregoing requirements with
respect to all Monthly Payments received by the Interim Servicer after the
Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication errors;
(ii) The party receiving notice of a misapplied payment occurring
prior to the applicable Transfer Date and discovered after the Transfer
Date shall immediately notify the other party;
(iii) If a misapplied payment which occurred prior to the Transfer
Date cannot be identified and said misapplied payment has resulted in a
shortage in a Custodial Account or Escrow Account, the Seller shall be
liable for the amount of such shortage. The Seller shall reimburse the
Purchaser for the amount of such shortage within thirty (30) days after
receipt of written demand therefor from the Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer
Date has created an improper Purchase Price as the result of an inaccurate
outstanding principal balance, a check shall be issued to the party
shorted by the improper payment application within five (5) Business Days
after notice thereof by the other party; and
(v) Any check issued under the provisions of this Section 8(h) shall
be accompanied by a statement indicating the corresponding Seller and/or
the Purchaser Mortgage Loan identification number and an explanation of
the allocation of any such payments.
(i) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be in
accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on or before the Transfer
Date, reconcile principal balances and make any monetary adjustments required by
the Purchaser. Any such monetary adjustments will be transferred between the
Seller and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer
to file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be
filed on or before the Transfer Date in relation to the servicing and ownership
of the related Mortgage Loans. The Seller shall provide copies of such forms to
the Purchaser upon request and shall reimburse the Purchaser for any costs or
penalties incurred by the Purchaser due to the Seller's failure to comply with
this paragraph.
SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 9.01 Representations and Warranties Regarding the Seller.
The Seller represents, warrants and covenants to the Purchaser that
as of the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a limited
liability company duly organized, validly existing and in good standing under
the laws of the state of Florida and has all licenses necessary to carry on its
business as now being conducted and is licensed, qualified and in good standing
in each state wherein it owns or leases any material properties or where a
Mortgaged Property is located, if the laws of such state require licensing or
qualification in order to conduct business of the type conducted by the Seller,
and in any event the Seller is in compliance with the laws of any such state to
the extent necessary to ensure the enforceability of the related Mortgage Loan
and the servicing of such Mortgage Loan in accordance with the terms of this
Agreement and the Interim Servicing Agreement; the Seller has the full
organizational power, authority and legal right to hold, transfer and convey the
Mortgage Loans and to execute and deliver this Agreement and to perform its
obligations hereunder and thereunder; the execution, delivery and performance of
this Agreement (including all instruments of transfer to be delivered pursuant
to this Agreement) by the Seller and the consummation of the transactions
contemplated hereby and thereby have been duly and validly authorized; this
Agreement and all agreements contemplated hereby have been duly executed and
delivered and constitute the valid, legal, binding and enforceable obligations
of the Seller, regardless of whether such enforcement is sought in a proceeding
in equity or at law; and all requisite corporate or other action has been taken
by the Seller to make this Agreement and all agreements contemplated hereby
valid and binding upon the Seller in accordance with their terms;
(b) Ordinary Course of Business. The consummation of the
transactions contemplated by this Agreement are in the ordinary course of
business of the Seller, and the transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages by the Seller pursuant to this Agreement are
not subject to the bulk transfer or any similar statutory provisions in effect
in any applicable jurisdiction;
(c) No Conflicts. Neither the execution and delivery of this
Agreement, the acquisition or origination of the Mortgage Loans by the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation of the
transactions contemplated hereby and thereby, nor the fulfillment of or
compliance with the terms and conditions of this Agreement, will conflict with
or result in a breach of any of the terms, conditions or provisions of the
Seller's charter, by-laws or other organizational documents or any legal
restriction or any agreement or instrument to which the Seller is now a party or
by which it is bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Seller or its property is subject, or
result in the creation or imposition of any lien, charge or encumbrance that
would have an adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument, or impair the ability
of the Purchaser to realize on the Mortgage Loans, impair the value of the
Mortgage Loans, or impair the ability of the Purchaser to realize the full
amount of any insurance benefits accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer 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 OTS, the OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller, on behalf of the Interim
Servicer, acknowledges and agrees that the Servicing Fee, represents reasonable
compensation for performing such services and that the entire Servicing Fee
shall be treated by the Interim Servicer, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans pursuant
to this Agreement and the Interim Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller does not believe, nor
does it have any reason or cause to believe, that it cannot perform each and
every covenant contained in this Agreement. The Seller is solvent and the sale
of the Mortgage Loans will not cause the Seller to become insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of Seller's creditors;
(g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or which, either in any one instance or in the
aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Seller contemplated herein, or which
would be likely to impair the ability of the Seller to perform under the terms
of this Agreement;
(h) No Consent Required. No consent, approval, authorization or
order of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is
required for the execution, delivery and performance by the Seller of or
compliance by the Seller with this Agreement or the Mortgage Loans, the delivery
of a portion of the Mortgage Files to the Custodian or the sale of the Mortgage
Loans or the consummation of the transactions contemplated by this Agreement, or
if required, such approval has been obtained prior to the related Closing Date;
(i) Selection Process. The Mortgage Loans were selected from among
the outstanding one- to four-family mortgage loans in the Seller's portfolio at
the related Closing Date as to which the representations and warranties set
forth in Subsection 9.02 could be made and such selection was not made in a
manner so as to affect adversely the interests of the Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of
the related Mortgage Loan Package are as set forth on the description of the
pool characteristics for the applicable Mortgage Loan Package delivered pursuant
to Section 11 on the related Closing Date in the form attached as Exhibit B to
each related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any
information, statement, tape, diskette, report, form, or other document
furnished or to be furnished pursuant to this Agreement or any Reconstitution
Agreement or in connection with the transactions contemplated hereby (including
any Securitization Transaction or Whole Loan Transfer) contains or will contain
any untrue statement of fact or omits or will omit to state a fact necessary to
make the statements contained herein or therein not misleading;
(l) Financial Statements. The Seller has delivered to the Purchaser
financial statements as to its last three complete fiscal years and any later
quarter ended more than 60 days prior to the execution of this Agreement. All
such financial statements fairly present the pertinent results of operations and
changes in financial position for each of such periods and the financial
position at the end of each such period of the Seller and its subsidiaries and
have been prepared in accordance with generally accepted accounting principles
of the United States consistently applied throughout the periods involved,
except as set forth in the notes thereto. In addition, the Seller has delivered
information as to its loan gain and loss experience in respect of foreclosures
and its loan delinquency experience for the immediately preceding three-year
period, in each case with respect to mortgage loans owned by it and mortgage
loans serviced for others during such period, and all such information so
delivered shall be true and correct in all material respects. There has been no
change in the business, operations, financial condition, properties or assets of
the Seller since the date of the Seller's financial statements that would have
an adverse effect on its ability to perform its obligations under this
Agreement. The Seller has completed any forms requested by the Purchaser in a
timely manner and in accordance with the provided instructions;
(m) No Brokers. The Seller has not dealt with any broker, investment
banker, agent or other person that may be entitled to any commission or
compensation in connection with the sale of the Mortgage Loans;
(n) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes; (o) Reasonable Purchase Price. The consideration
received by the Seller upon the sale of the Mortgage Loans under this Agreement
constitutes fair consideration and reasonably equivalent value for the Mortgage
Loans;
(p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note, and upon the sale
of the Mortgage Loans to the Purchaser, the Seller will retain the Mortgage
Files with respect thereto in trust only for the purpose of servicing and
supervising the servicing of each Mortgage Loan;
(q) Seller's Origination. The Seller's decision to originate any
mortgage loan or to deny any mortgage loan application is an independent
decision based upon Seller's underwriting guidelines, and is in no way made as a
result of Purchaser's decision to purchase, or not to purchase, or the price
Purchaser may offer to pay for, any such mortgage loan, if originated;
(r) Compliance with Anti-Money Laundering Laws. The Seller has
complied with all applicable anti-money laundering laws, regulations and
executive orders, including without limitation the USA Patriot Act of 2001
(collectively, the "Anti-Money Laundering Laws"); the Seller has established an
anti-money laundering compliance program as required by the Anti-Money
Laundering Laws, has conducted the requisite due diligence in connection with
the origination of each Mortgage Loan for purposes of the Anti-Money Laundering
Laws, including with respect to the legitimacy of the applicable Mortgagor and
the origin of the assets used by the said Mortgagor to purchase the property in
question, and maintains, and will maintain, sufficient information to identify
the applicable Mortgagor for purposes of the Anti-Money Laundering Laws;
(s) Delivery to the Custodian. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to the Custodial Agreement shall be
delivered to the Custodian all in compliance with the specific requirements of
the Custodial Agreement. With respect to each Mortgage Loan, the Seller will be
in possession of a complete Mortgage File in compliance with Exhibit A hereto,
except for such documents as will be delivered to the Custodian; and
(t) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan, will fully furnish, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files to
Equifax, Experian and Trans Union Credit Information Company (three of the
credit repositories), on a monthly basis.
Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that, as
to each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the
Closing Date under the terms of the Mortgage Note have been made and credited.
As of the Closing Date, no payment required under the Mortgage Loan is 30 days
or more delinquent nor has any payment under the Mortgage Loan been 30 days or
more delinquent at any time since the origination of the Mortgage Loan;
(c) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage securing the Mortgage Loan, 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 an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Except for (A) payments in the nature
of escrow payments and (B) interest accruing from the date of the Mortgage Note
or date of disbursement of the Mortgage Loan proceeds, whichever is earlier to
the day which precedes by one month the Due Date of the first installment of
principal and interest, including, without limitation, taxes and insurance
payments, the Seller has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination except by a written instrument which has been
recorded, if necessary to protect the interests of the Purchaser, and which has
been delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. No
Mortgagor has been released, in whole or in part, except in connection with an
assumption agreement, approved by the title insurer, to the extent required by
the policy, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) No Defenses. The Mortgage Loan is 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 either the
Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject to
any right of rescission, set-off, counterclaim or defense, including without
limitation the defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are provided for in the Xxxxxx Xxx Guides or by
Xxxxxxx Mac, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement attached hereto as Exhibit B. If required by the
National Flood Insurance Act of 1968, as amended, each Mortgage Loan is covered
by a flood insurance policy meeting the requirements of the current guidelines
of the Federal Insurance Administration in effect, which policy conforms to
Xxxxxx Xxx and Xxxxxxx Mac, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement attached hereto as Exhibit B.
All individual insurance policies contain a standard mortgagee clause naming the
Seller and its successors and assigns as mortgagee, and all premiums thereon
have been paid and such policies may not be reduced, terminated or cancelled
without 30 days' prior written notice to the mortgagee. The Mortgage obligates
the Mortgagor thereunder to maintain the hazard insurance policy at the
Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
such Mortgagor's cost and expense, and to seek reimbursement therefor from the
Mortgagor. Where required by state law or regulation, the Mortgagor has been
given an opportunity to choose the carrier of the required hazard insurance,
provided the policy is not a "master" or "blanket" hazard insurance policy
covering a condominium, or any hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy is the
valid and binding obligation of the insurer, is in full force and effect, and
will be in full force and effect and inure to the benefit of the Purchaser upon
the consummation of the transactions contemplated by this Agreement. The Seller
has not engaged in, and has no knowledge of the Mortgagor's or any servicer's
having engaged in, any act or omission which would impair the coverage of any
such policy, the benefits of the endorsement provided for herein, or the
validity and binding effect of such policy, including, without limitation, no
unlawful fee, commission, kickback or other unlawful compensation or value of
any kind has been or will be received, retained or realized by any attorney,
firm or other person or entity, and no such unlawful items have been received,
retained or realized by the Seller;
(g) Compliance with Applicable Laws. 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,
predatory, abusive and fair lending, equal credit opportunity and disclosure
laws applicable to the Mortgage Loan, including, without limitation, any
provisions relating to prepayment penalties, have been complied with, the
consummation of the transactions contemplated hereby will not involve the
violation of any such laws or regulations, and the Seller shall maintain in its
possession, available for the Purchaser's inspection, and shall deliver to the
Purchaser upon demand, evidence of compliance with all such requirements. This
representation is a Deemed Material Breach Representation;
(h) No Satisfaction of Mortgage. The Mortgage has not been
satisfied, canceled, subordinated or rescinded, in whole or in part, and the
Mortgaged Property has not been released from the lien of the Mortgage, in whole
or in part, nor has any instrument been executed that would effect any such
release, cancellation, subordination or rescission. The Seller 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
Seller waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property
is a fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a low-rise condominium project, or an individual
unit in a planned unit development and that no residence or dwelling is (i) a
mobile home or (ii) a manufactured home, provided, however, that any condominium
unit or planned unit development shall not fall within any of the "Ineligible
Projects" of part XII, Section 102 of the Xxxxxx Mae Selling Guide and shall
conform with the Underwriting Guidelines. As of the date of origination, no
portion of the Mortgaged Property was used for commercial purposes, and since
the date of origination, no portion of the Mortgaged Property has been used for
commercial purposes; provided, that Mortgaged Properties which contain a home
office shall not be considered as being used for commercial purposes as long as
the Mortgaged Property has not been altered for commercial purposes and is not
storing any chemicals or raw materials other than those commonly used for
homeowner repair, maintenance and/or household purposes;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements on
the Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to such
buildings, and all additions, alterations and replacements made at any time,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. In no event shall any Mortgage Loan be
in a lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the
first mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and
assessments not yet due and payable;
(3) covenants, conditions and restrictions, rights of
way, easements and other matters of the public record as of
the date of recording acceptable to prudent mortgage lending
institutions generally and specifically referred to in the
lender's title insurance policy delivered to the originator of
the Mortgage Loan and (a) specifically referred to or
otherwise considered in the appraisal made for the originator
of the Mortgage Loan or (b) which do not adversely affect the
Appraised Value of the Mortgaged Property set forth in such
appraisal; and
(4) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of
the security intended to be provided by the Mortgage or the
use, enjoyment, value or marketability of the related
Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Seller has full right to sell and
assign the same to Purchaser. The Mortgaged Property was not, as of the date of
origination of the Mortgage Loan, subject to a mortgage, deed of trust, deed to
secure debt or other security instrument creating a lien subordinate to the lien
of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage and any other agreement executed and delivered by a Mortgagor or
guarantor, if applicable, in connection with a Mortgage Loan are genuine, and
each is the legal, valid and binding obligation of the maker thereof enforceable
in accordance with its terms (including, without limitation, any provisions
therein relating to prepayment penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage and
any other related agreement, and the Mortgage Note, the Mortgage and any other
such related agreement have been duly and properly executed by other such
related parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material fact
or omit to state a material fact required to be stated therein or necessary to
make the information and statements therein not misleading. No fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination or servicing of the Mortgage Loan. The Seller
has reviewed all of the documents constituting the Servicing File and has made
such inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed
and 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 improvement and as to disbursements of any
escrow funds therefor have been complied with. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage were paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due under the Mortgage Note or Mortgage;
(m) Ownership. The Seller is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon
the sale of the Mortgage Loans to the Purchaser, the Seller will retain the
Mortgage Files or any part thereof with respect thereto not delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan. The
Mortgage Loan is not assigned or pledged, and the Seller has good, indefeasible
and marketable title thereto, and has full right to transfer and sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest, and
has full right and authority subject to no interest or participation of, or
agreement with, any other party, to sell and assign each Mortgage Loan pursuant
to this Agreement and following the sale of each 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
Seller intends to relinquish all rights to possess, control and monitor the
Mortgage Loan. After the Closing Date, the Seller will have no right to modify
or alter the terms of the sale of the Mortgage Loan and the Seller will have no
obligation or right to repurchase the Mortgage Loan or substitute another
Mortgage Loan, except as provided in this Agreement;
(n) Doing Business. All parties which have had any interest in the
Mortgage Loan, whether as mortgagee, assignee, pledgee or otherwise, are (or,
during the period in which they held and disposed of such interest, were) (1) in
compliance with any and all applicable licensing requirements of the laws of the
state wherein the Mortgaged Property is located, and (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state, or
(iii) a federal savings and loan association, a savings bank or a national bank
having a principal office in such state, or (3) not doing business in such
state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien
Loan has a CLTV in excess of 90%. No Mortgage Loan has an LTV greater than 100%.
At origination of the Mortgage Loan, the Mortgagor did not have a FICO score of
less than 500;
(p) Title Insurance. The 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 Xxxxxxx Mac and each such title insurance
policy is issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and
qualified to do business in the jurisdiction where the Mortgaged Property is
located, insuring the Seller, its successors and assigns, as to the first
priority lien (with respect to First Lien Loans) or second priority lien (with
respect to Second Lien Loans) of the Mortgage in the original principal amount
of the Mortgage Loan, subject only to the exceptions contained in clauses (1)
and (2) of paragraph (j) of this Subsection 9.02, and in the case of Adjustable
Rate Mortgage Loans, against any loss by reason of the invalidity or
unenforceability of the lien resulting from the provisions of the Mortgage
providing for adjustment to 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.
Additionally, such lender's title insurance policy affirmatively insures ingress
and egress, and against encroachments by or upon the Mortgaged Property or any
interest therein. The title policy does not contain any special exceptions
(other than the standard exclusions) for zoning and uses and has been marked to
delete the standard survey exception or to replace the standard survey exception
with a specific survey reading. The Seller, its successor and assigns, are the
sole insureds of such lender's title insurance policy, and such lender's title
insurance policy is valid and remains in full force and effect and will be in
force and effect upon the consummation of the transactions contemplated by this
Agreement. No claims have been made under such lender's title insurance policy,
and no prior holder of the related Mortgage, including the Seller, has done, by
act or omission, anything which would impair the coverage of such lender's title
insurance policy, including without limitation, no unlawful fee, commission,
kickback or other unlawful compensation or value of any kind has been or will be
received, retained or realized by any attorney, firm or other person or entity,
and no such unlawful items have been received, retained or realized by the
Seller;
(q) No Defaults. There is no default, breach, violation or event
which would permit acceleration existing under the Mortgage or the Mortgage Note
and no event which, with the passage of time or with notice and the expiration
of any grace or cure period, would constitute a default, breach, violation or
event which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note, (iii) there is no event which, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the Second Lien Loan to
receive notice of, and affords such mortgagee an opportunity to cure any default
by payment in full or otherwise under the prior mortgage;
(r) No Mechanics' Liens. 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 the law could give rise to such liens) affecting the
related Mortgaged Property which are or may be liens prior to, or equal or
coordinate with, the lien of the related Mortgage;
(s) Location of Improvements; No Encroachments. All improvements
which were considered in determining the Appraised Value of the Mortgaged
Property lay wholly within the boundaries and building restriction lines of the
Mortgaged Property, and no improvements on adjoining properties encroach upon
the Mortgaged Property. The Mortgaged Property and all improvements located on
or being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
(t) Origination; Payment Terms. 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 Act, a savings and loan association, a savings
bank, a commercial bank, credit union, insurance company or other similar
institution which is supervised and examined by a federal or state authority.
The documents, instruments and agreements submitted for loan underwriting were
not falsified and contain no untrue statement of material fact or omit to state
a material fact required to be stated therein or necessary to make the
information and statements therein not misleading. No Mortgage Loan contains
terms or provisions which would result in negative amortization. Principal
payments on the Mortgage Loan commenced no more than sixty days after funds were
disbursed in connection with the Mortgage Loan. The Mortgage Interest Rate as
well as, with respect to Adjustable Rate Mortgage Loans, the Lifetime Rate Cap,
the Periodic Rate Floor and the Periodic Rate Cap are as set forth on Exhibit B
to each related Assignment and Conveyance Agreement. The Mortgage Interest Rate
is adjusted, with respect to Adjustable Rate Mortgage Loans, on each Interest
Rate Adjustment Date to equal the Index plus the Gross Margin (rounded up or
down to the nearest 0.125%), subject to the Periodic Rate Cap. The Mortgage Note
is payable in equal monthly installments of principal and interest, which
installments of interest, with respect to Adjustable Rate Mortgage Loans, are
subject to change due to the adjustments to the Mortgage Interest Rate on each
Interest Rate Adjustment Date, with interest calculated and payable in arrears,
sufficient to amortize the Mortgage Loan fully by the stated maturity date
(unless the Mortgage Loan is identified on the Mortgage Loan Schedule as a
Balloon Mortgage Loan), over an original term of not more than thirty years from
commencement of amortization. Unless otherwise specified on the description of
pool characteristics for the applicable Mortgage Loan Package delivered pursuant
to Section 11 on the related Closing Date in the form attached as Exhibit B to
each related Assignment and Conveyance Agreement, the Mortgage Loan is payable
on the first day of each month. There are no Convertible Mortgage Loans which
contain a provision allowing the Mortgagor to convert the Mortgage Note from an
adjustable interest rate Mortgage Note to a fixed interest rate Mortgage Note.
The Due Date of the first payment under the Mortgage Note is no more than 60
days from the date of the Mortgage Note;
(u) Customary Provisions. The 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, (i) in the case of a
Mortgage designated as a deed of trust, by trustee's sale, and (ii) otherwise by
judicial foreclosure. Upon default by a Mortgagor on a Mortgage Loan and
foreclosure on, or trustee's sale of, the Mortgaged Property pursuant to the
proper procedures, the holder of the Mortgage Loan will be able to deliver good
and merchantable title to the Mortgaged Property. There is no homestead or other
exemption available to a Mortgagor which would interfere with the right to sell
the Mortgaged Property at a trustee's sale or the right to foreclose the
Mortgage, subject to applicable federal and state laws and judicial precedent
with respect to bankruptcy and right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The
Mortgage Loan was underwritten in accordance with the Underwriting Guidelines (a
copy of which is attached to the related Assignment and Conveyance Agreement as
Exhibit C). The Mortgage Note and Mortgage are on forms acceptable to Xxxxxxx
Mac or Xxxxxx Mae and no representations have been made to a Mortgagor that are
inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date the
Mortgaged Property is lawfully occupied under applicable law. All inspections,
licenses and certificates required to be made or issued with respect to all
occupied portions of the Mortgaged Property and, with respect to the use and
occupancy of the same, including but not limited to certificates of occupancy
and fire underwriting certificates, have been made or obtained from the
appropriate authorities. The Seller has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Seller has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. The Mortgagor represented at the time of origination of the
Mortgage Loan that the Mortgagor would occupy the Mortgaged Property as the
Mortgagor's primary residence;
(x) No Additional Collateral. The 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 in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. There are no circumstances or conditions
with respect to the Mortgage, the Mortgaged Property, the Mortgagor, the
Mortgage File or the Mortgagor's credit standing that can reasonably be expected
to cause private institutional investors to regard the Mortgage Loan as an
unacceptable investment, cause the Mortgage Loan to become delinquent, or
adversely affect the value or marketability of the Mortgage Loan, or cause the
Mortgage Loan to prepay during any period materially faster or slower than the
mortgage loans originated by the Seller generally. No Mortgaged Property is
located in a state, city, county or other local jurisdiction which the Purchaser
has determined in its sole good faith discretion would cause the related
Mortgage Loan to be ineligible for whole loan sale or securitization in a
transaction consistent with the prevailing sale and securitization industry
(including, without limitation, the practice of the rating agencies) with
respect to substantially similar mortgage loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the
Mortgage, the Assignment of Mortgage and any other documents required to be
delivered under this Agreement for each Mortgage Loan have been delivered to the
Custodian. The Seller is in possession of a complete, true and accurate Mortgage
File in compliance with Exhibit A hereto, except for such documents the
originals of which have been delivered to the Custodian, and the Seller has
retained copies thereof;
(bb) Condominiums/Planned Unit Developments. If the Mortgaged
Property is a condominium unit or a planned unit development (other than a de
minimis planned unit development) such condominium or planned unit development
project is (i) acceptable to Xxxxxx Xxx or Xxxxxxx Mac or (ii) located in a
condominium or planned unit development project which has received project
approval from Xxxxxx Mae or Xxxxxxx Mac. The representations and warranties
required by Xxxxxx Mae with respect to such condominium or planned unit
development have been satisfied and remain true and correct;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Seller are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Seller has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to
the Mortgagor prior to the applicable Cut-off Date have been consolidated with
the outstanding principal amount secured by the Mortgage, and the secured
principal amount, as consolidated, bears a single interest rate and single
repayment term. The lien of the Mortgage securing the consolidated principal
amount is expressly insured as having first or second, as applicable, lien
priority by a title insurance policy, an endorsement to the policy insuring the
mortgagee's consolidated interest or by other title evidence acceptable to
Xxxxxx Xxx and Xxxxxxx Mac. The consolidated principal amount does not exceed
the original principal amount of the Mortgage Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings.
There is no proceeding pending or threatened for the total or partial
condemnation of the Mortgaged Property. The Mortgaged Property is undamaged by
waste, fire, earthquake or earth movement, windstorm, flood, tornado or other
casualty so as to affect adversely the value of the Mortgaged Property as
security for the Mortgage Loan or the use for which the premises were intended
and each Mortgaged Property is in good repair. There have not been any
condemnation proceedings with respect to the Mortgaged Property and the Seller
has no knowledge of any such proceedings in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate
Adjustments. The origination, servicing and collection practices with respect to
the Mortgage Loan have been in all respects in compliance with Accepted
Servicing Practices, applicable laws and regulations, and have been in all
respects legal and proper. With respect to escrow deposits and Escrow Payments
(other than with respect to Second Lien Loans for which the mortgagee under the
prior mortgage lien is collecting Escrow Payments), all such payments are in the
possession of Seller and there exist no deficiencies in connection therewith for
which customary arrangements for repayment thereof have not been made. Each
Mortgage Loan is covered by a paid in full, life of loan, tax service contract
that has been assigned without penalty, premium or cost to the Purchaser. All
Escrow Payments have been collected in full compliance with state and federal
law and the provisions of the related Mortgage Note and Mortgage. An escrow of
funds is not prohibited by applicable law and has been established in an amount
sufficient to pay for every item that remains unpaid and has been assessed but
is not yet due and payable. No escrow deposits or Escrow Payments or other
charges or payments due the Seller have been capitalized under the Mortgage or
the Mortgage Note. All Mortgage Interest Rate adjustments have been made in
strict compliance with state and federal law and the terms of the related
Mortgage and Mortgage Note on the related Interest Rate Adjustment Date. If,
pursuant to the terms of the Mortgage Note, another index was selected for
determining the Mortgage Interest Rate, the same index was used with respect to
each Mortgage Note which required a new index to be selected, and such selection
did not conflict with the terms of the related Mortgage Note. Any and all
notices required under applicable law and the terms of the related Mortgage Note
and Mortgage regarding the Mortgage Interest Rate and the Monthly Payment
adjustments have been delivered. Any interest required to be paid pursuant to
state, federal and local law has been properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan has the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has existed on or
prior to the Closing Date that has resulted or will result in the exclusion
from, denial of, or defense to coverage under any applicable primary mortgage
insurance policy, hazard insurance policy or bankruptcy bond (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), irrespective of the cause of such failure of
coverage. The Seller has caused or will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser. In connection with the placement of any such
insurance, no commission, fee, or other compensation has been or will be
received by the Seller or by any officer, director, or employee of the Seller or
any designee of the Seller or any corporation in which the Seller or any
officer, director, or employee had a financial interest at the time of placement
of such insurance;
(ll) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not
notified the Seller, and the Seller has no knowledge of any relief requested or
allowed to the Mortgagor under the Servicemembers' Civil Relief Act as amended,
or any similar state statute;
(nn) Appraisal. The Seller has delivered to the Purchaser an
appraisal of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser qualified under Xxxxxx Xxx and Xxxxxxx Mac
guidelines who (i) is licensed in the state where the Mortgaged Property is
located, (ii) has no interest, direct or indirect, in the Mortgaged Property or
in any Loan or the security therefor, and (iii) does not receive compensation
that is affected by the approval or disapproval of the Mortgage Loan. The
appraisal shall have been made within one hundred and eighty (180) days of the
origination of the Mortgage Loan and shall be completed in compliance with the
Uniform Standards of Professional Appraisal Practice, and all applicable Federal
and state laws and regulations. If the appraisal was made more than one hundred
and twenty (120) days before the origination of the Mortgage Loan, the Seller
shall have received and delivered to the Purchaser a recertification of the
appraisal;
(oo) Disclosure Materials. The Mortgagor has, to the extent required
by applicable law, executed a statement to the effect that the Mortgagor has,
received all disclosure materials required by applicable law and the Seller has
complied with all applicable law with respect to the making of the Mortgage
Loans. The Seller shall cause the Interim Servicer to maintain such statement in
the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. The
Mortgage Loan was not made in connection with the construction or rehabilitation
of a Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) No Defense to Insurance Coverage. No action has been taken or
failed to be taken, no event has occurred and no state of facts exists or has
existed on or prior to the Closing Date (whether or not known to the Seller on
or prior to such date) which has resulted or will result in an exclusion from,
denial of, or defense to coverage under any primary mortgage insurance
(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 Seller, the
related Mortgagor or any party involved in the application for such coverage,
including the appraisal, plans and specifications and other exhibits or
documents submitted therewith to the insurer under such insurance policy, or for
any other reason under such coverage, but not including the failure of such
insurer to pay by reason of such insurer's breach of such insurance policy or
such insurer's financial inability to pay. In connection with the placement of
any such insurance, no commission, fee, or other compensation has been or will
be received by the Seller or any designee of the Seller or any corporation in
which the Seller or any officer, director, or employee had a financial interest
at the time of placement of such insurance;
(rr) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(ss) Credit Information. As to each consumer report (as defined in
the Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Seller to the Purchaser, that Seller has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Seller shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Seller has in its capacity as servicer, for each Mortgage Loan,
fully furnished, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g., favorable and
unfavorable) on its borrower credit files to Equifax, Experian and Trans Union
Credit Information Company (three of the credit repositories), on a monthly
basis. This representation is a Deemed Material Breach Representation;
(tt) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate, the assignment of the lease without the lessor's consent and
the acquisition by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder of the
Mortgage with substantially similar protections; (3) the terms of such lease do
not (a) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than 15 years; (5) the term of such lease does not terminate earlier than
five years after the maturity date of the Mortgage Note; and (6) the Mortgaged
Property is located in a jurisdiction in which the use of leasehold estates in
transferring ownership in residential properties is a widely accepted practice;
(uu) Prepayment Penalty. The Mortgage Loan is subject to a
prepayment penalty as provided in the related Mortgage Note except as set forth
on Exhibit B to each related Assignment and Conveyance Agreement. With respect
to each Mortgage Loan that has a prepayment penalty feature, each such
prepayment penalty is enforceable and, subject to Section 9.04, will be enforced
by the Seller for the benefit of the Purchaser, and each prepayment penalty is
permitted pursuant to federal, state and local law. Each such prepayment penalty
is in an amount equal to the maximum amount permitted under applicable law and
no such prepayment penalty may provide for a term in excess of five (5) years
with respect to Mortgage Loans originated prior to October, 1, 2002. With
respect to Mortgage Loans originated on or after October 1, 2002, the duration
of the prepayment period shall not exceed three (3) years from the date of the
Mortgage Note unless the Mortgage Loan was modified to reduce the prepayment
period to no more than three (3) years from the date of such Mortgage Note and
the Mortgagor was notified in writing of such reduction in prepayment period.
With respect to any Mortgage Loan that contains a provision permitting
imposition of a prepayment penalty upon a prepayment prior to maturity: (i) the
Mortgage Loan provides some benefit to the Mortgagor (e.g., a rate or fee
reduction) in exchange for accepting such prepayment penalty, (ii) the Mortgage
Loan's originator had a written policy of offering the Mortgagor or requiring
third-party brokers to offer the Mortgagor, the option of obtaining a mortgage
loan that did not require payment of such a penalty and (iii) the prepayment
penalty was adequately disclosed to the Mortgagor in the loan documents pursuant
to applicable state, local and federal law. This representation is a Deemed
Material Breach Representation;
(vv) Assumability. With respect to each Adjustable Rate Mortgage
Loan, the Mortgage Loan Documents provide that after the related first Interest
Rate Adjustment Date, a related Mortgage Loan may only be assumed if the party
assuming such Mortgage Loan meets certain credit requirements stated in the
Mortgage Loan Documents;
(ww) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(xx) Escrow Analysis. With respect to each Mortgage, the Seller has
within the last twelve months (unless such Mortgage was originated within such
twelve month period) analyzed the required Escrow Payments for each Mortgage and
adjusted the amount of such payments so that, assuming all required payments are
timely made, any deficiency will be eliminated on or before the first
anniversary of such analysis, or any overage will be refunded to the Mortgagor,
in accordance with RESPA and any other applicable law;
(yy) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion. This representation is a Deemed Material Breach
Representation;
(zz) Single-Premium Credit Life Insurance Policy. No Mortgagor was
required to purchase any single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property insurance policy) or debt
cancellation agreement as a condition of obtaining the extension of credit. No
Mortgagor obtained a prepaid single premium credit insurance policy (e.g., life,
disability, accident, unemployment or property 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 or debt
cancellation agreements as part of the origination of, or as a condition to
closing, such Mortgage Loan. This representation is a Deemed Material Breach
Representation;
(aaa) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or trustees for an Illinois land trust or a trustee under a "living
trust" and such "living trust" is in compliance with Xxxxxx Mae guidelines for
such trusts;
(bbb) Insurance. The Seller has caused or will cause to be performed
any and all acts required to preserve the rights and remedies of the Purchaser
in any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser;
(ccc) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(ddd) Flood Certification Contract. The Mortgage Loan is covered by
a paid in full, life of loan, transferable flood certification contract that has
been assigned without penalty cost or premium to the Purchaser;
(eee) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(fff) Origination Date. The date of origination of the Mortgage Loan
shall be no earlier than three (3) months prior to the date such Mortgage Loan
is first purchased by the Purchaser;
(ggg) No Exception. The Custodian has not noted any material
exceptions on an Exception Report (as defined in the Custodial Agreement) with
respect to the Mortgage Loan which would materially adversely affect the
Mortgage Loan or the Purchaser's ownership of the Mortgage Loan, unless
consented to by the Purchaser;
(hhh) Mortgage Submitted for Recordation. The Mortgage either has
been or will promptly be submitted for recordation in the appropriate
governmental recording office of the jurisdiction where the Mortgaged Property
is located;
(iii) Endorsements. The Mortgage Note has been endorsed by Seller
for its own account and not as a fiduciary, trustee, trustor or beneficiary
under a trust agreement;
(jjj) Accuracy of Information. All information provided to the
Purchaser by the Seller with respect to the Mortgage Loan is accurate in all
material respects;
(kkk) Mortgagor Bankruptcy. On or prior to the date 60 days after
the related Closing Date, the Mortgagor has not filed or will not file a
bankruptcy petition or has not become the subject or will not become the subject
of involuntary bankruptcy proceedings or has not consented to or will not
consent to the filing of a bankruptcy proceeding against it or to a receiver
being appointed in respect of the related Mortgaged Property;
(lll) No Construction Loans. No Mortgage Loan was made in connection
with (a) facilitating the trade-in or exchange of a Mortgaged Property or (b)
the construction or rehabilitation of a Mortgaged Property, unless the Mortgage
Loan is a construction-to-permanent mortgage loan listed on the Mortgage Loan
Schedule which has been fully disbursed, all construction work is complete and a
completion certificate has been issued;
(mmm) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Seller has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor; and
(nnn) Proceeds of Mortgage Loan. The proceeds of the Mortgage Loan
have not been and shall not be used to satisfy, in whole or in part, any debt
owed or owing by the Mortgagor to Seller or any Affiliate or correspondent
thereof unless such debt was originated more than 24 months prior to the
origination of such Mortgage Loan;
(ooo) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction. This representation is a Deemed Material Breach Representation;
(ppp) Origination Practices/No Steering. The Mortgagor was not
encouraged or required to select a Mortgage Loan product offered by the Mortgage
Loan's originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account such facts as, without limitation, the
Mortgage Loan's requirements and the Mortgagor's credit history, income, assets
and liabilities 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. For a Mortgagor who seeks financing through a Mortgage Loan
originator's higher-priced subprime lending channel, the Mortgagor was directed
towards or offered the Mortgage Loan originator's standard mortgage line if the
Mortgagor was able to qualify for one of the standard products. This
representation is a Deemed Material Breach Representation;
(qqq) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan does not rely on the extent of
the Mortgagor's equity in the collateral as the principal determining factor in
approving such extension of credit. The methodology employed objective criteria
that related such facts as, without limitation, the Mortgagor's credit history,
income, assets or liabilities, to the proposed mortgage payment and, based on
such methodology, the Mortgage Loan's originator made a reasonable determination
that at the time of origination the Mortgagor had the ability to make timely
payments on the Mortgage Loan. Such underwriting methodology confirmed that at
the time of origination (application/approval) the Mortgagor had a reasonable
ability to make timely payments on the Mortgage Loan. This representation is a
Deemed Material Breach Representation;
(rrr) [Reserved].
(sss) Fees Charges. All fees and charges (including finance charges)
and whether or not financed, assessed, collected or to be collected in
connection with the origination and servicing of each Mortgage Loan has been
disclosed in writing to the Mortgagor in accordance with applicable state and
federal law and regulation. This representation is a Deemed Material Breach
Representation; and
(ttt) Second Lien Mortgage Loans. With respect to each Second Lien
Loan: (1) the related First Lien Loan does not permit negative amortization; (2)
where required or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) to the best of Seller's
knowledge, the related First Lien Loan is in full force and effect, and there is
no default, lien, breach, violation or event which would permit acceleration
existing under such First Lien Loan or 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 which would
permit acceleration under such First Lien Loan; (4) the related first lien
Mortgage contains a provision which provides for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such mortgagee to
cure any default under the related first lien Mortgage; and (5) the related
Mortgaged Property is the Mortgagor's principal residence. This representation
is a Deemed Material Breach Representation.
Subsection 9.03 Remedies for Breach of Representations and
Warranties.
It is understood and agreed that the representations and warranties
set forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage
Loans to the Purchaser and shall inure to the benefit of the Purchaser,
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
Assignment of Mortgage or the examination or failure to examine any Mortgage
File. Upon discovery by either the Seller or the Purchaser of a breach of any of
the foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other.
Within sixty (60) days of the earlier of either discovery by or
notice to the Seller of any breach of a representation or warranty which
materially and adversely affects the value of the Mortgage Loans or the interest
of the Purchaser therein (or which materially and adversely affects the value of
the applicable Mortgage Loan or the interest of the Purchaser therein in the
case of a representation and warranty relating to a particular Mortgage Loan),
the Seller shall use its best efforts promptly to cure such breach in all
material respects and, if such breach cannot be cured, the Seller shall, at the
Purchaser's option, repurchase such Mortgage Loan at the Repurchase Price,
together with all expenses incurred by the Purchaser as a result of such
repurchase. Notwithstanding the above sentence, (i) within sixty (60) days of
the earlier of either discovery by, or notice to, the Seller of any breach of
the representation and warranty set forth in clause (rr) of Subsection 9.02, the
Seller shall repurchase such Mortgage Loan at the Repurchase Price, together
with all expenses incurred by the Purchaser as a result of such repurchase and
(ii) any breach of a Deemed Material Breach Representation shall automatically
be deemed to materially and adversely affect the value of the Mortgage Loan and
the interest of the Purchaser therein. In the event that a breach shall involve
any representation or warranty set forth in Subsection 9.01, and (except as
provided in the preceding sentence with respect to certain breaches for which no
cure is permitted) such breach cannot be cured within sixty (60) days of the
earlier of either discovery by or notice to the Seller of such breach, all of
the Mortgage Loans shall, at the Purchaser's option, be repurchased by the
Seller at the Repurchase Price, together with all expenses incurred by the
Purchaser as a result of such repurchase. However, if the breach shall involve a
representation or warranty set forth in Subsection 9.02 (other than the
representations and warranties set forth in clause (rr) of such Subsection or
any Deemed Material Breach Representation) and the Seller discovers or receives
notice of any such breach within one hundred twenty (120) days of the related
Closing Date, the Seller shall, at the Purchaser's option and provided that the
Seller has a Qualified Substitute Mortgage Loan, rather than repurchase the
Mortgage Loan as provided above, remove such Mortgage Loan (a "Deleted Mortgage
Loan") and substitute in its place a Qualified Substitute Mortgage Loan or
Loans, provided that any such substitution shall be effected not later than one
hundred twenty (120) days after the related Closing Date. If the Seller has no
Qualified Substitute Mortgage Loan, it shall repurchase the deficient Mortgage
Loan. Any repurchase of a Mortgage Loan or Loans pursuant to the foregoing
provisions of this Subsection 9.03 shall be accomplished by either (a) if the
Interim Servicing Agreement has been entered into and is in effect, deposit in
the Custodial Account of the amount of the Repurchase Price for distribution to
the Purchaser on the next scheduled Remittance Date, after deducting therefrom
any amount received in respect of such repurchased Mortgage Loan or Loans and
being held in the Custodial Account for future distribution or (b) if the
Interim Servicing Agreement has not been entered into or is no longer in effect,
by direct remittance of the Repurchase Price to the Purchaser or its designee in
accordance with the Purchaser's instructions.
At the time of repurchase or substitution, the Purchaser and the
Seller shall arrange for the reassignment of the Deleted Mortgage Loan to the
Seller and the delivery to the Seller of any documents held by the Custodian
relating to the Deleted Mortgage Loan. In the event of a repurchase or
substitution, the Seller shall, simultaneously with such reassignment, give
written notice to the Purchaser that such repurchase or substitution has taken
place, amend the Mortgage Loan Schedule to reflect the withdrawal of the Deleted
Mortgage Loan from this Agreement, and, in the case of substitution, identify a
Qualified Substitute Mortgage Loan and amend the Mortgage Loan Schedule to
reflect the addition of such Qualified Substitute Mortgage Loan to this
Agreement. In connection with any such substitution, the Seller shall be deemed
to have made as to such Qualified Substitute Mortgage Loan the representations
and warranties set forth in this Agreement except that all such representations
and warranties set forth in this Agreement shall be deemed made as of the date
of such substitution. The Seller shall effect such substitution by delivering to
the Custodian or to such other party as the Purchaser may designate in writing
for such Qualified Substitute Mortgage Loan the documents required by Subsection
6.03 with the Mortgage Note endorsed as required by Subsection 6.03. No
substitution will be made in any calendar month after the Determination Date for
such month. The Seller shall cause the Interim Servicer to remit directly to the
Purchaser, or its designee in accordance with the Purchaser's instructions the
Monthly Payment less the Servicing Fee due, if any, on such Qualified Substitute
Mortgage Loan or Loans in the month following the date of such substitution.
Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the
month of substitution shall be retained by the Seller. For the month of
substitution, distributions to the Purchaser shall include the Monthly Payment
due on any Deleted Mortgage Loan in the month of substitution, and the Seller
shall thereafter be entitled to retain all amounts subsequently received by the
Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the
Seller shall indemnify the Purchaser and its present and former directors,
officers, employees and agents and any Successor Servicer and its present and
former directors, officers, employees and agents and hold such parties harmless
against any losses, damages, penalties, fines, forfeitures, legal fees and
expenses and related costs, judgments, and other costs and expenses resulting
from any claim, demand, defense or assertion based on or grounded upon, or
resulting from, a breach of any representation or warranty contained in this
Agreement or any Reconstitution Agreement. It is understood and agreed that the
obligations of the Seller set forth in this Subsection 9.03 to cure, substitute
for or repurchase a defective Mortgage Loan and to indemnify the Purchaser and
Successor Servicer as provided in this Subsection 9.03 and Subsection 14.01
constitute the sole remedies of the Purchaser and Successor Servicer respecting
a breach of the foregoing representations and warranties. For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean the Person then acting as the
Successor Servicer under this Agreement and any and all Persons who previously
were "Successor Servicers" under this Agreement.
Any cause of action against the Seller relating to or arising out of
the breach of any representations and warranties made in Subsections 9.01 and
9.02 shall accrue as to any Mortgage Loan upon (i) discovery of such breach by
the Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by
the Seller to cure such breach or repurchase such Mortgage Loan as specified
above, and (iii) demand upon the Seller by the Purchaser for compliance with
this Agreement.
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full.
If any Mortgage Loan is prepaid within sixty (60) days from and
after the related Closing Date, the Seller shall pay to the Purchaser, within
three (3) business days of such prepayment in full, an amount equal to the
Premium Percentage multiplied by the outstanding principal balance of such
Mortgage Loan as of the date of such prepayment in full, less the amount of any
prepayment penalty on such Mortgage Loan actually received by the Purchaser (or,
in the event that the servicing of such Mortgage Loan has been transferred from
the Interim Servicer to a servicer approved by the Purchaser, less the amount of
any prepayment penalty which has been waived by the successor servicer).
Notwithstanding the foregoing, if the Seller is the Interim Servicer, the Seller
may waive a prepayment penalty payable by a Mortgagor during the 60 days from
and after the related Closing Date.
Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults.
(a) If the related Mortgagor is Delinquent with respect to the
Mortgage Loan's first Monthly Payment after origination of such Mortgage Loan,
the Seller, at the Purchaser's option exercised in its sole discretion, shall
repurchase such Mortgage Loan from the Purchaser at a price equal to the
percentage of par as stated in the related Purchase Price and Terms Agreement
(subject to adjustment as provided therein) multiplied by the then outstanding
principal balance of such Mortgage Loan, plus accrued and unpaid interest
thereon from the date to which interest was last paid through the day prior to
the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan.
(b) (b) If the related Mortgagor is Delinquent with respect to the
Mortgage Loan's Monthly Payment due in the month in which the related Closing
Date occurs or the Monthly Payment due in the month following the month in which
the related Closing Date occurs, in each case, on its due date or within the
grace period, all in accordance with the terms of the related Mortgage Note, the
Seller, at the Purchaser's option exercised in its sole discretion, shall
repurchase such Mortgage Loan from the Purchaser at a price equal to the
percentage of par as stated in the related Purchase Price and Terms Agreement
(subject to adjustment as provided therein) multiplied by the then outstanding
principal balance of such Mortgage Loan, plus accrued and unpaid interest
thereon from the date to which interest was last paid through the day prior to
the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan;
provided, however, that the Purchaser shall provide written notification to the
Seller of any delinquent payment described above.
SECTION 10. Closing.
The closing for the purchase and sale of each Mortgage Loan Package
shall take place on the related Closing Date. At the Purchaser's option, the
Closing shall be either: by telephone, confirmed by letter or wire as the
parties shall agree, or conducted in person, at such place as the parties shall
agree.
The closing for the Mortgage Loans to be purchased on each Closing
Date shall be subject to each of the following conditions:
(a) at least two Business Days prior to the related Closing Date,
the Seller shall deliver to the Purchaser, in electronic format acceptable to
the Purchaser in its sole discretion, a listing on a loan-level basis of the
necessary information to compute the Purchase Price of the Mortgage Loans
delivered on the Closing Date (including accrued interest), and prepare a
Mortgage Loan Schedule;
(b) all of the representations and warranties of the Seller under
this Agreement and of the Interim Servicer under the Interim Servicing Agreement
(with respect to each Mortgage Loan for an interim period, as specified therein)
shall be true and correct as of the related Closing Date and no event shall have
occurred which, with notice or the passage of time, would constitute a default
under this Agreement or an Event of Default under the Interim Servicing
Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys
shall have received in escrow, all closing documents as specified in Section 11
of this Agreement, 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 Seller shall have delivered and released to the Custodian
all documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the
Seller on the related Closing Date the Purchase Price, plus accrued interest
pursuant to Section 4 of this Agreement, by wire transfer of immediately
available funds to the account designated by the Seller.
SECTION 11. Closing Documents.
The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date shall consist of fully executed originals of the following
documents:
1. this Agreement (to be executed and delivered only for the
initial Closing Date);
2. the Amended and Restated Interim Servicing Agreement, dated as
of the initial Cut-off Date, in the form of Exhibit B hereto
(to be executed and delivered only for the initial Closing
Date);
3. with respect to the initial Closing Date, the Custodial
Agreement, dated as of the initial Cut-off Date;
4. the related Mortgage Loan Schedule, segregated by Mortgage
Loan Package, one copy to be attached hereto, one copy to be
attached to the Custodian's counterpart of the Custodial
Agreement, and one copy to be attached to the related
Assignment and Conveyance as the Mortgage Loan Schedule
thereto;
5. a Custodian's Certification, as required under the Custodial
Agreement, in the form of Exhibit G-1 to the Custodial
Agreement;
6. with respect to the initial Closing Date, a Custodial Account
Letter Agreement or a Custodial Account Certification, as
applicable, as required under the Interim Servicing Agreement;
7. with respect to the initial Closing Date, an Escrow Account
Letter Agreement or an Escrow Account Certification, as
applicable, as required under the Interim Servicing Agreement;
8. with respect to the initial Closing Date, an Officer's
Certificate, in the form of Exhibit C hereto with respect to
each of the Seller and the Interim Servicer, including all
attachments hereto; with respect to subsequent Closing Dates,
an Officer's Certificate upon request of the Purchaser;
9. with respect to the initial Closing Date, an Opinion of
Counsel of each of the Seller and the Interim Servicer (who
may be an employee of the Seller or the Interim Servicer, as
applicable), in the form of Exhibit D hereto ("Opinion of
Counsel of the Seller"); with respect to subsequent Closing
Dates, an Opinion of Counsel of the Seller upon request of the
Purchaser;
10. with respect to the initial Closing Date, an Opinion of
Counsel of the Custodian (who may be an employee of the
Custodian), in the form of an exhibit to the Custodial
Agreement;
11. a Security Release Certification, in the form of Exhibit E or
F, as applicable, hereto executed by any person, as requested
by the Purchaser, if any of the Mortgage Loans have at any
time been subject to any security interest, pledge or
hypothecation for the benefit of such person;
12. a certificate or other evidence of merger or change of name,
signed or stamped by the applicable regulatory authority, if
any of the Mortgage Loans were acquired by the Seller by
merger or acquired or originated by the Seller while
conducting business under a name other than its present name,
if applicable;
13. with respect to the initial Closing Date, the Underwriting
Guidelines to be attached to the related Assignment and
Conveyance as Exhibit C;
14. Assignment and Conveyance Agreement in the form of Exhibit H
hereto;
15. Exhibit B to the related Assignment and Conveyance Agreement;
and
16. a MERS Report reflecting the Purchaser as Investor and no
Person as Interim Funder for each MERS Designated Mortgage
Loan.
The Seller shall bear the risk of loss of the closing documents
until such time as they are received by the Purchaser or its attorneys.
SECTION 12. Costs.
The Purchaser shall pay any commissions due its salesmen and the
legal fees and expenses of its attorneys and custodial fees. All other costs and
expenses incurred in connection with the transfer and delivery of the Mortgage
Loans and the Servicing Rights including recording fees, fees for title policy
endorsements and continuations, fees for recording Assignments of Mortgage, and
the Seller's attorney's fees, shall be paid by the Seller.
SECTION 13. Cooperation of Seller with a Reconstitution.
The Seller and the Purchaser agree that with respect to some or all
of the Mortgage Loans, after each Closing Date, on one or more dates (each, a
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may effect
a Reconstitution of some or all of the Mortgage Loans then subject to this
Agreement, without recourse, to:
a) Xxxxxx Xxx under its Cash Purchase Program or MBS Program
(Special Servicing Option) (each, a "Xxxxxx Mae Transfer"); or
b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
c) one or more third party purchasers in one or more Whole Loan
Transfers; or
d) one or more trusts or other entities to be formed as part of
one or more Securitization Transactions.
The Seller agrees to execute in connection with any Agency Transfer,
any and all reasonably acceptable pool purchase contracts, and/or agreements
among the Purchaser, the Seller, Xxxxxx Xxx or Xxxxxxx Mac (as the case may be)
and any servicer in connection with a Whole Loan Transfer, a seller's warranties
and servicing agreement or a participation and servicing agreement in form and
substance reasonably acceptable to the parties, and in connection with a
Securitization Transaction, a pooling and servicing agreement in form and
substance reasonably acceptable to the parties or an Assignment and Recognition
Agreement substantially in the form attached hereto as Exhibit J (collectively,
the agreements referred to herein are designated, the "Reconstitution
Agreements"), together with an opinion of counsel with respect to such
Reconstitution Agreements.
With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller agrees (1) to cooperate
fully with the Purchaser and any prospective purchaser with respect to all
reasonable requests and due diligence procedures; (2) to execute, deliver and
perform all Reconstitution Agreements required by the Purchaser; and (3) to
restate the representations and warranties set forth in this Agreement and the
Interim Servicing Agreement as of the related Reconstitution Date or make
representations and warranties as may be reasonably required by the issuer, any
Rating Agency or prospective purchaser of the related securities or such
Mortgage Loans, in connection with such Reconstitution; provided that the Seller
shall make the representations and warranties set forth in Section 9.02(a), the
last sentence of (b), the first sentence of (c), (d), (e), the last sentence of
(f), (h), the last sentence of (i), (m), (n), the last sentence of (p), (q),
(r), the third and fourth sentences of (w), (x), (z), (hh), (ii), (kk), (ll),
(mm), (rr), (xx), (bbb) and (kkk) as of the related Transfer Date. With respect
to each additional requested representation and warranty required pursuant to
the preceding sentence, the Seller and the Purchaser shall negotiate such
representations and warranties in good faith and shall determine the
reasonableness of such requirement after consultation with each other. The
Seller shall provide to such servicer or issuer, as the case may be, and any
other participants or purchasers in such Reconstitution: (i) any and all
information and appropriate verification of information which may be reasonably
available to the Seller or its affiliates, whether through letters of its
auditors and counsel or otherwise, as the Purchaser or any such other
participant shall request; and (ii) such additional representations, warranties,
covenants, opinions of counsel, letters from auditors, and certificates of
public officials or officers of the Seller or the Interim Servicer as are
reasonably believed necessary by the Purchaser or any such other participant;
and (iii) to execute, deliver and satisfy all conditions set forth in any
indemnity agreement required by the Purchaser or any such participant,
including, without limitation, an Indemnification and Contribution Agreement in
substantially the form attached hereto as Exhibit K. Moreover, the Seller agrees
to cooperate with all reasonable requests made by the Purchaser to effect such
Reconstitution Agreements. The Seller shall indemnify the Purchaser, each
affiliate of the Purchaser participating in the Reconstitution and each Person
who controls the Purchaser or such affiliate and their respective present and
former directors, officers, employees and agents, and 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 each of them may sustain in any way related to any information
provided by or on behalf of the Seller regarding the Seller, the Seller's
servicing practices or performance, the Mortgage Loans or the Underwriting
Guidelines set forth in any offering document prepared in connection with any
Reconstitution. For purposes of the previous sentence, "Purchaser" shall mean
the Person then acting as the Purchaser under this Agreement and any and all
Persons who previously were "Purchasers" under this Agreement.
In the event the Purchaser has elected to have the Interim Servicer
or the Seller hold record title to the Mortgages, prior to the Reconstitution
Date, the Interim Servicer or the Seller shall prepare an assignment of mortgage
in blank or to the prospective purchaser or trustee, as applicable, from the
Interim Servicer or the Seller, as applicable, acceptable to the prospective
purchaser or trustee, as applicable, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), track such Assignments of
Mortgage to ensure they have been recorded and deliver them as required by the
prospective purchaser or trustee, as applicable, upon the Interim Servicer's
receipt thereof. Additionally, the Interim Servicer shall prepare and execute or
shall cause the Seller to execute, at the direction of the Purchaser, any note
endorsement in connection with any and all seller/servicer agreements.
All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if the Interim
Servicing Agreement shall remain in effect with respect to the related Mortgage
Loan Package, shall continue to be serviced in accordance with the terms of this
Agreement and the Interim Servicing Agreement and with respect thereto this
Agreement shall remain in full force and effect.
SECTION 14. The Seller.
Subsection 14.01 Additional Indemnification by the Seller; Third
Party Claims.
(a) The Seller shall indemnify the Purchaser and its present and
former directors, officers, employees and agents and any Successor Servicer and
its present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees (including legal fees incurred in connection with the
enforcement of the Seller's indemnification obligation under this Section 14.01)
and related costs, judgments, and any other costs, fees and expenses that such
parties may sustain in any way related to the failure of the Seller to perform
its duties and the Interim Servicer to service the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 13 or any breach of any of Seller's
representations, warranties and covenants set forth in this Agreement (provided
that such costs shall not include any lost profits). For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean the Person then acting as the
Successor Servicer under this Agreement and any and all Persons who previously
were "Successor Servicers" under this Agreement.
(b) Promptly after receipt by an indemnified party under this
Section 14.01 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 14.01, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve the indemnifying party from any liability which it may have to any
indemnified party under this Section 14.01, except to the extent that it has
been prejudiced in any material respect, or from any liability which it may
have, otherwise than under this Section 14.01. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent that it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party; provided that if the defendants in any
such action include both the indemnified party and the indemnifying party and
the indemnified party or parties shall have reasonably concluded that there may
be legal defenses available to it or them and/or other indemnified parties which
are different from or additional to those available to the indemnifying party,
the indemnified party or parties shall have the right to select separate counsel
to assert such legal defenses and to otherwise participate in the defense of
such action on behalf of such indemnified party or parties. Upon receipt of
notice from the indemnifying party to such indemnified party of its election so
to assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable to such indemnified party for
expenses incurred by the indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate counsel in
connection with the assertion of legal defenses in accordance with the proviso
to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with one local counsel, if applicable)), (ii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of commencement of the action or (iii) the indemnifying party
has authorized in writing the employment of counsel for the indemnified party at
the expense of the indemnifying party; and except that, if clause (i) or (iii)
is applicable, such liability shall be only in respect of the counsel referred
to in such clause (i) or (iii).
Subsection 14.02 Merger or Consolidation of the Seller.
The Seller 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 Seller may be merged or consolidated, or
any corporation resulting from any merger, conversion or consolidation to which
the Seller shall be a party, or any Person succeeding to the business of the
Seller, shall be the successor of the Seller hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that the
successor or surviving Person shall have a net worth of at least $30,000,000.
SECTION 15. Financial Statements.
The Seller understands that in connection with the Purchaser's
marketing of the Mortgage Loans, the Purchaser shall make available to
prospective purchasers audited financial statements of the Seller for the most
recently completed three fiscal years respecting which such statements are
available, as well as a Consolidated Statement of Condition of the Seller at the
end of the last two fiscal years covered by such Consolidated Statement of
Operations. The Seller shall also make available any comparable interim
statements to the extent any such statements have been prepared by the Seller
(and are available upon request to members or stockholders of the Seller or the
public at large). The Seller, if it has not already done so, agrees to furnish
promptly to the Purchaser copies of the statements specified above. The Seller
shall also make available information on its servicing performance with respect
to loans serviced for others, including delinquency ratios.
The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by
any prospective purchaser regarding recent developments affecting the Seller or
the financial statements of the Seller.
SECTION 16. Mandatory Delivery; Grant of Security Interest.
The sale and delivery on the related Closing Date of the Mortgage
Loans described on the related Mortgage Loan Schedule is mandatory from and
after the date of the execution of the related Purchase Price and Terms
Agreement, it being specifically understood and agreed that each Mortgage Loan
is unique and identifiable on the date hereof and that an award of money damages
would be insufficient to compensate the Purchaser for the losses and damages
incurred by the Purchaser (including damages to prospective purchasers of the
Mortgage Loans) in the event of the Seller's failure to deliver (i) each of the
related Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans
or (iii) one or more Mortgage Loans otherwise acceptable to the Purchaser on or
before the related Closing Date. The Seller hereby grants to the Purchaser a
lien on and a continuing security interest in each Mortgage Loan and each
document and instrument evidencing each such Mortgage Loan to secure the
performance by the Seller of its obligations under the related Purchase Price
and Terms Agreement, and the Seller agrees that it shall hold such Mortgage
Loans in custody for the Purchaser subject to the Purchaser's (i) right to
reject any Mortgage Loan (or Qualified Substitute Mortgage Loan) under the terms
of this Agreement and to require another Mortgage Loan (or Qualified Substitute
Mortgage Loan) to be substituted therefor, and (ii) obligation to pay the
Purchase Price for the Mortgage Loans. All rights and remedies of the Purchaser
under this Agreement are distinct from, and cumulative with, any other rights or
remedies under this Agreement or afforded by law or equity and all such rights
and remedies may be exercised concurrently, independently or successively.
SECTION 17. Notices.
All demands, notices and communications hereunder shall be in
writing and shall be given via email, facsimile transmission or registered or
certified mail to the person at the address set forth below:
(i) if to the Seller:
First NLC Financial Services, LLC
000 Xxxx Xxxxxxxxx Xxxxxxxxx, Xxxxxxxx 0
Xxxxxxxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxxxx and Xxxxxx Xxxxx
Fax: 000-000-0000
Email: xxxxxx@xxxxxxxx.xxx, xxxxxxxxx@xxxxxxxx.xxx
(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: 000-000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: 000-000-0000
Email: xxxxxx.xxxxx@xxxxxx.xxx
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 18. Severability Clause.
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 19. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.
SECTION 20. Governing Law Jurisdiction; Consent to Service of
Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED
COUNTERPART THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND
SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT SHALL
BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT
TO ITS CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER
IRREVOCABLY (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH
COURT; (III) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY
SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW; AND (IV) CONSENTS
TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL
ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER.
SECTION 21. Intention of the Parties.
It is the intention of the parties that the Purchaser is purchasing,
and the Seller is selling the Mortgage Loans and not a debt instrument of the
Seller or another security. Accordingly, the parties hereto each intend to treat
the transaction for Federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. Moreover, the arrangement
under which the Mortgage Loans are held shall be consistent with classification
of such arrangement as a grantor trust in the event it is not found to represent
direct ownership of the Mortgage Loans. The Purchaser shall have the right to
review the Mortgage Loans and the related Mortgage Loan Files to determine the
characteristics of the Mortgage Loans which shall affect the Federal income tax
consequences of owning the Mortgage Loans and the Seller shall cooperate with
all reasonable requests made by the Purchaser in the course of such review.
SECTION 22. Successors and Assigns; Assignment of Purchase
Agreement.
This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller and the Purchaser and the respective permitted
successors and assigns of the Seller and the successors and assigns of the
Purchaser. This Agreement shall not be assigned, pledged or hypothecated by the
Seller to a third party without the prior written consent of the Purchaser,
which consent may be withheld by the Purchaser in its sole discretion. This
Agreement may be assigned, pledged or hypothecated by the Purchaser in whole or
in part, and with respect to one or more of the Mortgage Loans, without the
consent of the Seller. There shall be no limitation on the number of assignments
or transfers allowable by the Purchaser with respect to the Mortgage Loans and
this Agreement. In the event the Purchaser assigns this Agreement, and the
assignee assumes any of the Purchaser's obligations hereunder, the Seller
acknowledges and agrees to look solely to such assignee, and not to the
Purchaser, for performance of the obligations so assumed and the Purchaser shall
be relieved from any liability to the Seller with respect thereto.
SECTION 23. Waivers.
No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced.
SECTION 24. Exhibits.
The exhibits to this Agreement are hereby incorporated and made a
part hereof and are an integral part of this Agreement.
SECTION 25. General Interpretive Principles.
For purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Agreement have the meanings assigned
to them in this Agreement and include the plural as well as the singular, and
the use of any gender herein shall be deemed to include the other gender;
(b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) references herein to "Articles," "Sections," "Subsections,"
"Paragraphs," and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other subdivisions of
this Agreement;
(d) reference to a Subsection without further reference to a Section
is a reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(e) the words "herein," "hereof," "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
provision; and
(f) the term "include" or "including" shall mean without limitation
by reason of enumeration.
SECTION 26. Reproduction of Documents.
This Agreement and all documents relating thereto, including,
without limitation, (a) consents, waivers and modifications which may hereafter
be executed, (b) documents received by any party at the closing, and (c)
financial statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 27. Further Agreements.
The Seller and the Purchaser each agree to execute and deliver to
the other such reasonable and appropriate additional documents, instruments or
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.
SECTION 28. 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 their 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 at the Seller's expense in the event recordation is either necessary
under applicable law or requested by the Purchaser at its sole option (other
than with respect to the MERS Designated Mortgage Loans).
SECTION 29. No Solicitation.
From and after the Closing Date, the Seller agrees that it will not
take any action or permit or cause any action to be taken by any of its agents
or affiliates, or by any independent contractors on the Seller's behalf, to
personally, by telephone or mail (via electronic means or otherwise), solicit
the borrower or obligor under any Mortgage Loan for any purpose whatsoever,
including to refinance a Mortgage Loan, in whole or in part, without the prior
written consent of the Purchaser. It is understood and agreed that all rights
and benefits relating to the solicitation of any Mortgagors and the attendant
rights, title and interest in and to the list of such Mortgagors and data
relating to their Mortgages (including insurance renewal dates) shall be
transferred to the Purchaser pursuant hereto on the Closing Date and the Seller
shall take no action to undermine these rights and benefits. Notwithstanding the
foregoing, it is understood and agreed that (i) promotions undertaken by the
Seller or any affiliate of the Seller which are directed to the general public
at large, including, without limitation, mass mailing based on commercially
acquired mailing lists, newspaper, radio and television advertisements shall not
constitute solicitation under this Section 29 and (ii) any solicitation in any
manner from a publicly purchased list shall not constitute solicitation under
this Section 29; provided that the publicly purchased list was purchased after
the origination date of the related Mortgage Loan.
SECTION 30. Waiver of Trial by Jury.
THE SELLER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS
AGREEMENT.
SECTION 31. Compliance with Regulation AB.
Subsection 31.01 Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose
of Section 31 of this Agreement is to facilitate compliance by the Purchaser and
any Depositor with the provisions of Regulation AB and related rules and
regulations of the Commission. Although Regulation AB is applicable by its terms
only to offerings of asset-backed securities that are registered under the
Securities Act, the Seller acknowledges that investors in privately offered
securities may require that the Purchaser or any Depositor provide comparable
disclosure in unregistered offerings. References in this Agreement to compliance
with Regulation AB include provision of comparable disclosure in private
offerings.
Neither the Purchaser nor any Depositor shall exercise its right to
request delivery of information or other performance under these provisions
other than in good faith, or for purposes other than compliance with the
Securities Act, the Exchange Act and the rules and regulations of the Commission
thereunder (or the provision in a private offering of disclosure comparable to
that required under the Securities Act). The Seller acknowledges that
interpretations of the requirements of Regulation AB may change over time,
whether due to interpretive guidance provided by the Commission or its staff,
consensus among participants in the asset-backed securities markets, advice of
counsel, or otherwise, and agrees to comply with 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, subject to
Section 1105(f) of Regulation AB. In connection with any Securitization
Transaction, the Seller 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
Seller, 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, subject to Section 1105(f) of
Regulation AB.
The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller by providing timely notice of requests for information
under these provisions and by reasonably limiting such requests to information
required, in the Purchaser's reasonable judgment, to comply with Regulation AB.
Subsection 31.02 Additional Representations and Warranties of the
Seller.
(a) The Seller shall be deemed to represent to the Purchaser and to
any Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Subsection 31.03 that, except as disclosed in
writing to the Purchaser or such Depositor prior to such date: (i) the Seller is
not aware and has not received notice that any default, early amortization or
other performance triggering event has occurred as to any other securitization
due to any act or failure to act of the Seller; (ii) the Interim Servicer has
not been terminated as servicer in a residential mortgage loan securitization,
either due to a servicing default or to application of a servicing performance
test or trigger; (iii) no material noncompliance with the applicable servicing
criteria with respect to other securitizations of residential mortgage loans
involving the Interim Servicer as servicer has been disclosed or reported by the
Seller; (iv) no material changes to the Interim Servicer's policies or
procedures with respect to the servicing function it will perform under the
Interim Servicing Agreement and any Reconstitution Agreement for mortgage loans
of a type similar to the Mortgage Loans have occurred during the three-year
period immediately preceding the related Securitization Transaction; (v) there
are no aspects of the Interim Servicer's financial condition that could have a
material adverse effect on the performance by the Interim Servicer of its
servicing obligations under the Interim Servicing Agreement or any
Reconstitution Agreement; (vi) there are no material legal or governmental
proceedings pending (or known to be contemplated) against the Seller, Interim
Servicer, any Subservicer or any Third-Party Originator; and (vii) there are no
affiliations, relationships or transactions relating to the Seller, Interim
Servicer, any Subservicer or any Third-Party Originator with respect to any
Securitization Transaction and any party thereto identified by the related
Depositor of a type described in Item 1119 of Regulation AB.
(b) If so requested by the Purchaser or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Subsection 31.03, the Seller shall, within five (5) Business
Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section or, if
any such representation and warranty is not accurate as of the date of such
request, provide reasonably adequate disclosure of the pertinent facts, in
writing, to the requesting party.
Subsection 31.03 Information to Be Provided by the Seller.
In connection with any Securitization Transaction the Seller shall
(i) within five (5) Business Days following request by the Purchaser or any
Depositor, provide to the Purchaser and such Depositor (or, as applicable, cause
each Third-Party Originator to provide), in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, the information and
materials specified in paragraphs (a) and (b) of this Section, and (ii) as
promptly as practicable following notice to or discovery by the Seller, provide
to the Purchaser and any Depositor (in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor) the information
specified in paragraph (d) of this Section.
(a) If so requested by the Purchaser or any Depositor, the Seller
shall provide such information regarding (i) the Seller, as originator of the
Mortgage Loans (including as an acquirer of Mortgage Loans from a Qualified
Correspondent), or (ii) each Third-Party Originator, as is requested for the
purpose of compliance with Items 1103(a)(1), 1105, 1110, 1117 and 1119 of
Regulation AB. Such information shall include, at a minimum:
(A) the originator's form of organization;
(B) a description of the originator's origination program and
how long the originator has been engaged in originating residential
mortgage loans, which description shall include a discussion of the
originator's experience in originating mortgage loans of a similar type as
the Mortgage Loans; information regarding the size and composition of the
originator's origination portfolio; and information that may be material,
in the good faith judgment of the Purchaser or any Depositor, to an
analysis of the performance of the Mortgage Loans, including the
originators' credit-granting or underwriting criteria for mortgage loans
of similar type(s) as the Mortgage Loans and such other information as the
Purchaser or any Depositor may reasonably request for the purpose of
compliance with Item 1110(b)(2) of Regulation AB;
(C) a description of any material legal or governmental
proceedings pending (or known to be contemplated) against the Seller and
each Third-Party Originator; and
(D) a description of any affiliation or relationship between
the Seller, each Third-Party Originator and any of the following parties
to a Securitization Transaction, as such parties are identified to the
Seller by the Purchaser or any Depositor in writing in advance of such
Securitization Transaction:
(1) the sponsor;
(2) the depositor;
(3) the issuing entity;
(4) any servicer;
(5) any trustee;
(6) any originator;
(7) any significant obligor;
(8) any enhancement or support provider; and
(9) any other material transaction party.
(b) If so requested by the Purchaser or any Depositor, the Seller
shall use reasonable good faith efforts to acquire, and to the extent the data
is available to Seller, to provide (or, as applicable, cause each Third-Party
Originator to provide) Static Pool Information with respect to the mortgage
loans (of a similar type as the Mortgage Loans, as reasonably identified by the
Purchaser as provided below) originated by (i) the Seller, if the Seller is an
originator of Mortgage Loans (including as an acquirer of Mortgage Loans from a
Qualified Correspondent), and/or (ii) each Third-Party Originator. Such Static
Pool Information shall be prepared by the Seller (or Third-Party Originator) on
the basis of its reasonable, good faith interpretation of the requirements of
Item 1105(a)(1)-(3) of Regulation AB. To the extent that there is reasonably
available to the Seller (or Third-Party Originator) Static Pool Information with
respect to more than one mortgage loan type, the Purchaser or any Depositor
shall be entitled to specify whether some or all of such information shall be
provided pursuant to this paragraph. The content of such Static Pool Information
may be in the form customarily provided by the Seller, and need not be
customized for the Purchaser or any Depositor. Such Static Pool Information for
each vintage origination year or prior securitized pool, as applicable, shall be
presented in increments no less frequently than quarterly over the life of the
mortgage loans included in the vintage origination year or prior securitized
pool. The most recent periodic increment must be as of a date no later than one
hundred thirty-five (135) days prior to the date of the prospectus or other
offering document in which the Static Pool Information is to be included or
incorporated by reference. The Static Pool Information shall be provided in an
electronic format that provides a permanent record of the information provided,
such as a portable document format (pdf) file, or other such electronic format
reasonably required by the Purchaser or the Depositor, as applicable.
Promptly following notice or discovery of a material error in Static
Pool Information provided pursuant to the immediately preceding paragraph
(including an omission to include therein information required to be provided
pursuant to such paragraph), the Seller shall provide corrected Static Pool
Information to the Purchaser or any Depositor, as applicable, in the same format
in which Static Pool Information was previously provided to such party by the
Seller.
If so requested by the Purchaser or any Depositor, the Seller shall
provide (or, as applicable, cause each Third-Party Originator to provide), at
the expense of the requesting party (to the extent of any additional incremental
expense associated with delivery pursuant to this Agreement), such agreed-upon
procedures letters of certified public accountants reasonably acceptable to the
Purchaser or Depositor, as applicable, pertaining to Static Pool Information
relating to prior securitized pools for securitizations closed on or after
January 1, 2006 or, in the case of Static Pool Information with respect to the
Seller's or Third-Party Originator's originations or purchases, to calendar
months commencing January 1, 2006, as the Purchaser or such Depositor shall
reasonably request. Such letters shall be addressed to and be for the benefit of
such parties as the Purchaser or such Depositor shall designate, which may
include, by way of example, any Sponsor, any Depositor and any broker dealer
acting as underwriter, placement agent or initial purchaser with respect to a
Securitization Transaction. Any such statement or letter may take the form of a
standard, generally applicable document accompanied by a reliance letter
authorizing reliance by the addressees designated by the Purchaser or such
Depositor.
(c) [Reserved].
(d) If so requested by the Purchaser or any Depositor for the
purpose of satisfying its reporting obligation under the Exchange Act with
respect to any class of asset-backed securities, the Seller shall (or shall
cause each Third-Party Originator to) (i) notify the Purchaser and any Depositor
in writing of (A) any material litigation or governmental proceedings pending
against the Seller or any Third-Party Originator and (B) any affiliations or
relationships that develop following the closing date of a Securitization
Transaction between the Seller or any Third-Party Originator and any of the
parties specified in clause (D) of paragraph (a) of this Section (and any other
parties identified in writing by the requesting party) with respect to such
Securitization Transaction, and (ii) provide to the Purchaser and any Depositor
a description of such proceedings, affiliations or relationships.
(e) With respect to those Mortgage Loans that were originated by the
Seller (including as an acquirer of Mortgage Loans from a Qualified
Correspondent) and sold to the Purchaser pursuant to this Agreement, the
Purchaser shall, to the extent consistent with then-current industry practice,
cause the servicer (or another party) to be obligated to provide information, in
the form customarily provided by such servicer or other party (which need not be
customized for the Seller) with respect to the Mortgage Loans reasonably
necessary for the Seller to comply with its obligations under regulation AB,
including, without limitation, providing to the Seller static pool information,
as set forth in Item 1105(a)(2), provided in the manner specified in Item
1105(a)(3) of Regulation AB (such information provided by the servicer or such
other party, the "Loan Performance Information").
Subsection 31.04 Indemnification; Remedies.
(a) The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser, the Depositor and each of the following parties participating in a
Securitization Transaction: each sponsor and issuing entity; each Person
responsible for the preparation, execution or filing of any report required to
be filed with the Commission with respect to such Securitization Transaction, or
for execution of a certification pursuant to Rule 13a-14(d) or Rule 15d-14(d)
under the Exchange Act with respect to such Securitization Transaction; each
broker dealer acting as underwriter, placement agent or initial purchaser, each
Person who controls any of such parties or the Depositor (within the meaning of
Section 15 of the Securities Act and Section 20 of the Exchange Act); and the
respective present and former directors, officers, employees and agents of each
of the foregoing and of the Depositor, and shall hold each of them harmless from
and against any losses, damages, penalties, fines, forfeitures, legal fees and
expenses and related costs, judgments, and any other costs, fees and expenses
that any of them may sustain arising out of or based upon:
(i) (A) any untrue statement of a material fact contained or alleged
to be contained in any information, report, certification, accountants'
letter or other material provided in written or electronic form under this
Section 31 by or on behalf of the Seller, or provided under this Section
31 by or on behalf of any Third-Party Originator (collectively, the
"Seller Information"), or (B) the omission or alleged omission to state in
the Seller Information a material fact required to be stated in the Seller
Information or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, by way of clarification, that clause (B) of this paragraph shall
be construed solely by reference to the Seller Information and not to any
other information communicated in connection with a sale or purchase of
securities, without regard to whether the Seller Information or any
portion thereof is presented together with or separately from such other
information;
(ii) any failure by the Seller or any Third-Party Originator to
deliver any information, report, certification, accountants' letter or
other material when and as required under this Section 31; or
(iii) any breach by the Seller of a representation or warranty set
forth in Subsection 31.02(a) or in a writing furnished pursuant to
Subsection 31.02(b) and made as of a date prior to the closing date of the
related Securitization Transaction, to the extent that such breach is not
cured by such closing date, or any breach by the Seller of a
representation or warranty in a writing furnished pursuant to Subsection
31.02(b) to the extent made as of a date subsequent to such closing date.
In the case of any failure of performance described in clause
(a)(ii) of this Section, the Seller shall promptly reimburse the Purchaser, any
Depositor, as applicable, and each Person responsible for the preparation,
execution or filing of any report required to be filed with the Commission with
respect to such Securitization Transaction, or for execution of a certification
pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect
to such Securitization Transaction, for all costs reasonably incurred by each
such party in order to obtain the information, report, certification,
accountants' letter or other material not delivered as required by the Seller or
any Third-Party Originator.
(b) (i) Any failure by the Seller or any Third-Party Originator to
deliver any information, report, certification, accountants' letter or other
material when and as required under this Section 31, or any breach by the Seller
of a representation or warranty set forth in Subsection 31.02(a) or in a writing
furnished pursuant to Subsection 31.02(b) and made as of a date prior to the
closing date of the related Securitization Transaction, to the extent that such
breach is not cured by such closing date, or any breach by the Seller of a
representation or warranty in a writing furnished pursuant to Subsection
31.02(b) to the extent made as of a date subsequent to such closing date, shall
immediately and automatically, without notice or grace period, constitute an
Event of Default with respect to the Seller under this Agreement and any
applicable Reconstitution Agreement, and shall entitle the Purchaser or
Depositor, as applicable, in its sole discretion to terminate the rights and
obligations of the Interim Servicer as servicer under the Interim Servicing
Agreement and/or any applicable Reconstitution Agreement without payment
(notwithstanding anything in this Agreement or any applicable Reconstitution
Agreement to the contrary) of any compensation to the Interim Servicer; provided
that to the extent that any provision of this Agreement and/or any applicable
Reconstitution Agreement expressly provides for the survival of certain rights
or obligations following termination of the Interim Servicer as servicer, such
provision shall be given effect.
(c) The Purchaser shall indemnify the Sellers, each affiliate of the
Sellers 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 Loan Performance Information or (B) the omission or
alleged omission to state in the Loan Performance Information a material
fact required to be stated in the Loan Performance 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 Loan Performance Information and not to any
other information communicated in connection with a sale or purchase of
securities, without regard to whether the Loan Performance Information or
any portion thereof is presented together with or separately from such
other information; or
(ii) any failure by the Purchaser or by the related servicer to
deliver any Loan Performance Information as required under Subsection
31.03(e).
[Signatures Commence on Following Page]
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective officers thereunto duly authorized
as of the date first above written.
IXIS REAL ESTATE CAPITAL INC.
(Purchaser)
By:____________________________________
Name:_______________________________
Title:______________________________
By:____________________________________
Name:_______________________________
Title:______________________________
FIRST NLC FINANCIAL SERVICES, LLC
(Seller)
By:____________________________________
Name:_______________________________
Title:______________________________
EXHIBIT A
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items, which shall be available for inspection by the
Purchaser and any prospective Purchaser, and which shall be delivered to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
pursuant to Section 6 of the Mortgage Loan Purchase and Warranties Agreement to
which this Exhibit is attached (the "Agreement"):
(a) the original Mortgage Note bearing all intervening
endorsements evidencing a complete chain of assignment from the originator to
the Seller, endorsed "Pay to the order of _________, without recourse" and
signed in the name of the Seller by an authorized officer. To the extent that
there is no room on the face of the Mortgage Notes for endorsements, the
endorsement may be contained on an allonge, if state law so allows and the
Custodian is so advised by the Seller that state law so allows. If the Mortgage
Loan was acquired by the Seller in a merger, the endorsement must be by
"[Seller], successor by merger to [name of predecessor]." If the Mortgage Loan
was acquired or originated by the Seller while doing business under another
name, the endorsement must be by "[Seller], formerly known as [previous name]";
(b) the original of any guarantee executed in connection with
the Mortgage Note;
(c) the original Mortgage with evidence of recording thereon. If
in connection with any Mortgage Loan, the Seller cannot deliver or cause to be
delivered the original Mortgage with evidence of recording thereon on or prior
to the Closing Date because of a delay caused by the public recording office
where such Mortgage has been delivered for recordation or because such Mortgage
has been lost or because such public recording office retains the original
recorded Mortgage, the Seller shall deliver or cause to be delivered to the
Custodian, a photocopy of such Mortgage, together with (i) in the case of a
delay caused by the public recording office, an Officer's Certificate of the
Seller stating that such Mortgage has been dispatched to the appropriate public
recording office for recordation and that the original recorded Mortgage or a
copy of such Mortgage certified by such public recording office to be a true and
complete copy of the original recorded Mortgage will be promptly delivered to
the Custodian upon receipt thereof by the Seller; or (ii) in the case of a
Mortgage where a public recording office retains the original recorded Mortgage
or in the case where a Mortgage is lost after recordation in a public recording
office, a copy of such Mortgage certified by such public recording office to be
a true and complete copy of the original recorded Mortgage;
(d) the originals of all assumption, modification,
consolidation or extension agreements, if any, with evidence of recording
thereon;
(e) except with respect to each MERS Designated Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording. The Assignment of Mortgage must be duly recorded only
if recordation is either necessary under applicable law or commonly required by
private institutional mortgage investors in the area where the Mortgaged
Property is located or on direction of the Purchaser as provided in this
Agreement. If the Assignment of Mortgage is to be recorded, the Mortgage shall
be assigned to the Purchaser. If the Assignment of Mortgage is not to be
recorded, the Assignment of Mortgage shall be delivered in blank. If the
Mortgage Loan was acquired by the Seller in a merger, the Assignment of Mortgage
must be made by "[Seller], successor by merger to [name of predecessor]". If the
Mortgage Loan was acquired or originated by the Seller while doing business
under another name, the Assignment of Mortgage must be by "[Seller], formerly
known as [previous name]";
(f) the originals of all intervening assignments of mortgage,
evidencing a complete chain of assignment from the originator to the Seller (or
MERS with respect to each MERS Designated Mortgage Loan), with evidence of
recording thereon, or if any such intervening assignment has not been returned
from the applicable recording office or has been lost or if such public
recording office retains the original recorded assignments of mortgage, the
Seller shall deliver or cause to be delivered to the Custodian, a photocopy of
such intervening assignment, together with (i) in the case of a delay caused by
the public recording office, an Officer's Certificate of the Seller stating that
such intervening assignment of mortgage has been dispatched to the appropriate
public recording office for recordation and that such original recorded
intervening assignment of mortgage or a copy of such intervening assignment of
mortgage certified by the appropriate public recording office to be a true and
complete copy of the original recorded intervening assignment of mortgage will
be promptly delivered to the Custodian upon receipt thereof by the Seller; or
(ii) in the case of an intervening assignment where a public recording office
retains the original recorded intervening assignment or in the case where an
intervening assignment is lost after recordation in a public recording office, a
copy of such intervening assignment certified by such public recording office to
be a true and complete copy of the original recorded intervening assignment;
(g) The original mortgagee policy of title insurance or, in the
event such original title policy is unavailable, a certified true copy of the
related policy binder or commitment for title certified to be true and complete
by the title insurance company; and
(h) security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage.
In the event an Officer's Certificate of the Seller is delivered to
the Purchaser because of a delay caused by the public recording office in
returning any recorded document, the Seller shall deliver to the Purchaser,
within 90 days of the Closing Date, an Officer's Certificate which shall (i)
identify the recorded document, (ii) state that the recorded document has not
been delivered to the Custodian due solely to a delay caused by the public
recording office, (iii) state the amount of time generally required by the
applicable recording office to record and return a document submitted for
recordation, and (iv) specify the date the applicable recorded document will be
delivered to the Custodian; provided, however, that any recorded document shall
in any event be delivered no later than one year from the applicable Closing
Date. An extension of the date specified in (iv) above may be requested from the
Purchaser, which consent shall not be unreasonably withheld.
EXHIBIT B
FORM OF INTERIM SERVICING AGREEMENT
EXHIBIT C
FORM OF SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
[Vice] President of ________________[COMPANY], a [state] [federally] chartered
institution organized under the laws of the [state of ____________] [United
States] (the "Company"), and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete copy
of the charter of the Company which is in full force and effect on the
date hereof and which has been in effect without amendment, waiver,
rescission or modification since ___________.
2. Attached hereto as Exhibit 2 is a true, correct and complete copy
of the bylaws of the Company which are in effect on the date hereof and
which have been in effect without amendment, waiver, rescission or
modification since ___________.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Company issued within ten days of the date hereof, and no
event has occurred since the date thereof which would impair such
standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete copy
of the corporate resolutions of the Board of Directors of the Company
authorizing the Company to execute and deliver [each of [the Mortgage Loan
Purchase and Warranties Agreement, dated as of _______ __, ____, by and
between IXIS Real Estate Capital Inc. (the "Purchaser") and the Company
(the "Purchase Agreement"),] [the Interim Servicing Agreement, dated as of
_______ __, ____, by and between the Company and the Purchaser (the
"Interim Servicing Agreement")] [and to endorse the Mortgage Notes and
execute the Assignments of Mortgages by original [or facsimile]
signature,]] and such resolutions are in effect on the date hereof and
have been in effect without amendment, waiver, rescission or modification
since ____________.
5. Either (i) 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 the [Purchase Agreement and the Interim Servicing Agreement,] the
sale of the mortgage loans or the consummation of the transactions
contemplated by the agreements; or (ii) any required consent, approval,
authorization or order has been obtained by the Company.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of the [Purchase Agreement and the Interim
Servicing Agreement] conflicts or will conflict with or results or will
result in a breach of or constitutes or will constitute a default under
the charter or by-laws of the Company, the terms of any indenture or other
agreement or instrument to which the Company is a party or by which it is
bound or to which it is subject, or any statute or order, rule,
regulations, writ, injunction or decree of any court, governmental
authority or regulatory body to which the Company is subject or by which
it is bound.
7. To the best of my knowledge, there is no action, suit, proceeding
or investigation pending or threatened against the Company which, in my
judgment, either in any one instance or in the aggregate, may result in
any material adverse change in the business, operations, financial
condition, properties or assets of the Company or in any material
impairment of the right or ability of the Company to carry on its business
substantially as now conducted or in any material liability on the part of
the Company or which would draw into question the validity of the
[Purchase Agreement and the Interim Servicing Agreement,] or the mortgage
loans or of any action taken or to be taken in connection with the
transactions contemplated hereby, or which would be likely to impair
materially the ability of the Company to perform under the terms of the
[Purchase Agreement and the Interim Servicing Agreement].
8. Each person listed on Exhibit 5 attached hereto who, as an
officer or representative of the Company, signed (a) the Purchase
Agreement, (b) the Interim Servicing Agreement and (c) any other document
delivered or on the date hereof in connection with any purchase described
in the agreements set forth above was, at the respective times of such
signing and delivery, and is now, a duly elected or appointed, qualified
and acting officer or representative of the Company, who holds the office
set forth opposite his or her name on Exhibit 5, and the signatures of
such persons appearing on such documents are their genuine signatures.
9. The Company is duly authorized to engage in the transactions
described and contemplated in the [Purchase Agreement, the Interim
Servicing Agreement and the Custodial Agreement].
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.
Dated: ___________________ By:___________________________________
Name:
[Seal] Title: [Vice] President
I, ________________________, an [Assistant] Secretary of
______________[COMPANY], hereby certify that ____________ is the duly elected,
qualified and acting [Vice] President of the Company and that the signature
appearing above is [her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated: ___________________ By:___________________________________
Name:
Title: [Assistant] Secretary
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
---- ----- ---------
__________________ __________________ __________________
__________________ __________________ __________________
__________________ __________________ __________________
__________________ __________________ __________________
__________________ __________________ __________________
__________________ __________________ __________________
EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER
AND INTERIM SERVICER (date)
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General
Counsel to ___________________ (the "Company"), with respect to certain matters
in connection with the sale by the Company of the Mortgage Loans pursuant to
that certain Mortgage Loan Purchase and Warranties Agreement by and between the
Company and IXIS Real Estate Capital Inc. (the "Purchaser"), dated as of
_________ __, ____ (the "Purchase Agreement") which sale is in the form of whole
loans, delivered pursuant to a Custodial Agreement dated as of _____ __, ____
among the Purchaser, the Company, ________________________ (the "Interim
Servicer") and ______________________[CUSTODIAN] (the "Custodial Agreement") and
serviced pursuant to an Interim Servicing Agreement, dated as of ______ __, ____
by and between the Interim Servicer and the Purchaser (the "Interim Servicing
Agreement" and, collectively with the Purchase Agreement and the Custodial
Agreement, the "Agreements"). Capitalized terms not otherwise defined herein
have the meanings set forth in the Purchase Agreement and the Interim Servicing
Agreement.
[We] [I] have examined the following documents:
1. the Purchase Agreement;
2. the Interim Servicing Agreement;
3. the Custodial Agreement;
4. the form of Assignment of Mortgage;
5. the form of endorsement of the Mortgage Notes; and
6. such other documents, records and papers as we have deemed
necessary and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I]
have relied upon the representations and warranties of the Company and the
Interim Servicer contained in the Purchase Agreement and in the Interim
Servicing Agreement, as applicable. [We] [I] have assumed the authenticity of
all documents submitted to [us] [me] as originals, the genuineness of all
signatures, the legal capacity of natural persons and the conformity to the
originals of all documents.
Based upon the foregoing, it is [our] [my] opinion that:
1. The Company and the Interim Servicer is [type of entity] duly
organized, validly existing and in good standing under the
laws of the [United States] and are qualified to transact
business in, and is in good standing under, the laws of [the
state of incorporation].
2. Each of the Company and the Interim Servicer has the power to
engage in the transactions contemplated by the Agreements to
which it is a party and all requisite power, authority and
legal right to execute and deliver such Agreements and to
perform and observe the terms and conditions of such
Agreements.
3. Each of the Agreements to which it is a party has been duly
authorized, executed and delivered by the Company and the
Interim Servicer, as applicable, and is a legal, valid and
binding agreement enforceable in accordance with its
respective terms against the Company and the Interim
Servicer, as applicable, 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, none of which will materially
interfere with the realization of the benefits provided
thereunder or with the Purchaser's ownership of the
Mortgage Loans.
4. Each of the Company and the Interim Servicer has been duly
authorized to allow any of its officers to execute any and
all documents by original signature in order to complete
the transactions contemplated by the Agreements to which it
is a party by original [or facsimile] signature in order to
execute the endorsements to the Mortgage Notes and the
Assignments of Mortgages, and the original [or facsimile]
signature of the officer at the Company executing the
endorsements to the Mortgage Notes and the Assignments of
Mortgages represents the legal and valid signature of said
officer of the Company.
5. Either (i) 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 or
the Interim Servicer of or compliance by the Company or the
Interim Servicer with the Agreements to which it is a party
and the sale of the Mortgage Loans by the Company or the
consummation of the transactions contemplated by the
Agreements to which each is a party or (ii) any required
consent, approval, authorization or order has been obtained
by the Company or the Interim Servicer.
6. Neither the consummation of the transactions contemplated
by, nor the fulfillment of the terms of, the Agreements to
which it is a party conflicts or will conflict with or
results or will result in a breach of or constitutes or
will constitute a default under the charter, by-laws or
other organizational documents of the Company or the
Interim Servicer, as applicable, the terms of any indenture
or other agreement or instrument to which the Company or
the Interim Servicer is a party or by which it is bound or
to which it is subject, or violates any statute or order,
rule, regulations, writ, injunction or decree of any court,
governmental authority or regulatory body to which the
Company or the Interim Servicer is subject or by which it
is bound.
7. There is no action, suit, proceeding or investigation
pending or threatened against the Company or the Interim
Servicer which, in [our] [my] judgment, either in any one
instance or in the aggregate, may result in any material
adverse change in the business, operations, financial
condition, properties or assets of the Company or the
Interim Servicer or in any material impairment of the right
or ability of the Company or the Interim Servicer to carry
on its business substantially as now conducted or in any
material liability on the part of the Company or the
Interim Servicer or which would draw into question the
validity of the Agreements to which it is a party or the
Mortgage Loans or of any action taken or to be taken in
connection with the transactions contemplated thereby, or
which would be likely to impair the ability of the Company
or the Interim Servicer to perform under the terms of the
Agreements to which it is a party.
8. The sale of each Mortgage Note and Mortgage as and in the
manner contemplated by the Agreements is sufficient to fully
transfer to the Purchaser all right, title and interest of the
Company thereto as noteholder and mortgagee.
9. The Mortgages have been duly assigned and the Mortgage
Notes have been duly endorsed as provided in the Custodial
Agreement. The Assignments of Mortgage are in recordable
form, except for the insertion of the name of the assignee,
and upon the name of the assignee being inserted, are
acceptable for recording under the laws of the state where
each related Mortgaged Property is located. The endorsement
of the Mortgage Notes, the delivery to the Purchaser, or
its designee, of the Assignments of Mortgage, and the
delivery of the original endorsed Mortgage Notes to the
Purchaser, or its designee, are sufficient to permit the
Purchaser to avail itself of all protection available under
applicable law against the claims of any present or future
creditors of the Company, and are sufficient to prevent any
other sale, transfer, assignment, pledge or hypothecation
of the Mortgages and the Mortgage Notes by the Company from
being enforceable.
This opinion is given to you for your sole benefit, and no other
person or entity is entitled to rely hereon except that the purchaser or
purchasers to which you initially and directly resell the Mortgage Loans may
rely on this opinion as if it were addressed to them as of its date.
Very truly yours,
_______________________________________
[Name]
[Assistant] General Counsel
EXHIBIT E
FORM OF SECURITY RELEASE CERTIFICATION
___________________, _____
________________________
________________________
________________________
Attention: ___________________________
___________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that ________________________ [COMPANY]
a [type of entity], organized pursuant to the laws of [the state of
incorporation] (the "Company") has committed to sell to IXIS Real Estate Capital
Inc. under that certain Third Amended and Restated Mortgage Loan Purchase and
Warranties Agreement, dated as of May 1, 2006, certain mortgage loans originated
by the Company. The Company warrants that the mortgage loans to be sold to IXIS
Real Estate Capital Inc. are in addition to and beyond any collateral required
to secure advances made by you to the Company.
The Company acknowledges that the mortgage loans to be sold to IXIS
Real Estate Capital Inc. shall not be used as additional or substitute
collateral for advances made by [____________]. IXIS Real Estate Capital Inc.
understands that the balance of the Company's mortgage loan portfolio may be
used as collateral or additional collateral for advances made by [___________],
and confirms that it has no interest therein.
Execution of this letter by [___________] shall constitute a full
and complete release of any security interest, claim, or lien which
[___________] may have against the mortgage loans to be sold to IXIS Real Estate
Capital Inc.
Very truly yours,
_______________________________________
By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
Acknowledged and approved:
__________________________
By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
EXHIBIT F
FORM OF SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
The financial institution named below hereby relinquishes any and
all right, title and interest it may have in all Mortgage Loans to be purchased
by IXIS Real Estate Capital Inc. from the Company named below pursuant to that
certain Third Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of May 1, 2006, and certifies that all notes, mortgages,
assignments and other documents in its possession relating to such Mortgage
Loans have been delivered and released to the Company named below or its
designees, as of the date and time of the sale of such Mortgage Loans to IXIS
Real Estate Capital Inc.
Name and Address of Financial Institution
_______________________________________
(Name)
_______________________________________
(Address)
By:____________________________________
II. Certification of Release
The Company named below hereby certifies to IXIS Real Estate Capital
Inc. that, as of the date and time of the sale of the above-mentioned Mortgage
Loans to IXIS Real Estate Capital Inc. the security interests in the Mortgage
Loans released by the above-named financial institution comprise all security
interests relating to or affecting any and all such Mortgage Loans. The Company
warrants that, as of such time, there are and will be no other security
interests affecting any or all of such Mortgage Loans.
_______________________________________
By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
EXHIBIT G
[RESERVED]
EXHIBIT H
ASSIGNMENT AND CONVEYANCE
On this ___ day of __________, ____, First NLC Financial Services,
LLC ("Seller"), as (i) the Seller under that certain Purchase Price and Terms
Agreement, dated as of ___________, _____ (the "PPTA"), (ii) the Seller under
that certain Third Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of May 1, 2006 (the "Purchase Agreement") and (iii) the
Seller/Interim Servicer under that certain Second Amended and Restated Interim
Servicing Agreement, dated as of November 1, 2005 (the "Interim Servicing
Agreement" and, together with the PPTA and the Purchase Agreement, the
"Agreements") does hereby sell, transfer, assign, set over and convey to IXIS
Real Estate Capital Inc. ("Purchaser") as the Purchaser under the Agreements,
without recourse, but subject to the terms of the Agreements, all right, title
and interest of, in and to the Mortgage Loans listed on the Mortgage Loan
Schedule attached hereto as Exhibit A (the "Mortgage Loans"), together with the
Mortgage Files and all rights and obligations arising under the documents
contained therein. Each Mortgage Loan subject to the Agreements was underwritten
in accordance with, and conforms to, the Underwriting Guidelines attached hereto
as Exhibit C. Pursuant to Section 6 of the Purchase Agreement, the Seller has
delivered to the Custodian the documents for each Mortgage Loan to be purchased
as set forth in the Custodial Agreement. The contents of each Servicing File
required to be retained by First NLC Financial Services, LLC ("Interim
Servicer") to service the Mortgage Loans pursuant to the Interim Servicing
Agreement and thus not delivered to the Purchaser are and shall be held in trust
by the Seller in its capacity as Interim Servicer for the benefit of the
Purchaser as the owner thereof. The Interim Servicer's possession of any portion
of the Servicing File is at the will of the Purchaser for the sole purpose of
facilitating servicing of the related Mortgage Loan pursuant to the Interim
Servicing Agreement, and such retention and possession by the Interim Servicer
shall be in a custodial capacity only. The ownership of each Mortgage Note,
Mortgage, the Servicing Rights and the contents of the Mortgage File and
Servicing File is vested in the Purchaser and the ownership of all records and
documents with respect to the related Mortgage Loan prepared by or which come
into the possession of the Seller or the Interim Servicer shall immediately vest
in the Purchaser and shall be retained and maintained, in trust, by the Seller
at the will of the Purchaser in such custodial capacity only.
The Mortgage Loan Package characteristics of the Mortgage Loans
subject hereto are set forth on Exhibit B hereto.
In accordance with Section 6 of the Purchase Agreement, the
Purchaser accepts the Mortgage Loans listed on Exhibit A attached hereto.
Notwithstanding the foregoing the Purchaser does not waive any rights or
remedies it may have under the Agreements.
Capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
FIRST NLC FINANCIAL SERVICES, LLC
By:____________________________________
Name:__________________________________
Title:_________________________________
Accepted and Agreed:
IXIS REAL ESTATE CAPITAL INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
By:____________________________________
Name:__________________________________
Title:_________________________________
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL CHARACTERISTICS OF
EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on
the related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than _ months prior to the related
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than
___; or (5) a debt-to-income ratio of more than __%. Each First Lien Loan has a
Mortgage Interest Rate of at least ___% per annum and an outstanding principal
balance less than $_________. Each Second Lien Loan has a Mortgage Interest Rate
of at least ______% per annum and an outstanding principal balance less than
$________. Each Adjustable Rate Mortgage Loan has an Index of [_______].
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
EXHIBIT I
SELLER'S UNDERWRITING GUIDELINES
EXHIBIT J
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [____________
__, 20__] ("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"),
[____________________] ("Assignee") and [SELLER] (the "Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and
other valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and
assigns to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Mortgage Loan
Purchase and Warranties Agreement (the "Purchase Agreement"), dated as of
[DATE], between the Assignor, as purchaser (the "Purchaser"), and the Company,
as seller, solely insofar as the Purchase Agreement relates to the Mortgage
Loans.
The Assignor specifically reserves and does not assign to the
Assignee hereunder (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 Purchase Agreement which are not the Mortgage Loans set forth on the
Mortgage Loan Schedule and are not the subject of this Agreement or (ii) the
rights of the Purchaser under Section 9.04 of the Purchase Agreement.
Recognition of the Company
2. 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 Purchase Agreement
(solely to the extent set forth herein) and this Agreement to
[__________________] (the "Trust") created pursuant to a Pooling and Servicing
Agreement, dated as of [______], 2002 (the "Pooling Agreement"), among the
Assignee, the Assignor, [___________________], as trustee (including its
successors in interest and any successor trustees under the Pooling Agreement,
the "Trustee"), [____________________], as servicer (including its successors in
interest and any successor servicer under the Pooling Agreement, the
"Servicer"). The Company hereby acknowledges and agrees that from and after the
date hereof (i) the Trust will be the owner of the Mortgage Loans, (ii) the
Company shall look solely to the Trust for performance of any obligations of the
Assignor insofar as they relate to the Mortgage Loans, (iii) the Trust
(including the Trustee and the Servicer acting on the Trust's behalf) shall have
all the rights and remedies available to the Assignor, insofar as they relate to
the Mortgage Loans, under the Purchase Agreement, including, without limitation,
the enforcement of the document delivery requirements set forth in Section 6 of
the Purchase Agreement, and shall be entitled to enforce all of the obligations
of the Company thereunder insofar as they relate to the Mortgage Loans, and (iv)
all references to the Purchaser, the Custodian or the Bailee under the Purchase
Agreement insofar as they relate to the Mortgage Loans, shall be deemed to refer
to the Trust (including the Trustee and the Servicer acting on the Trust's
behalf). Neither the Company nor the Assignor shall amend or agree to amend,
modify, waiver, or otherwise alter any of the terms or provisions of the
Purchase Agreement which amendment, modification, waiver or other alteration
would in any way affect the Mortgage Loans or the Company's performance under
the Purchase Agreement with respect to the Mortgage Loans without the prior
written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the
Assignee and the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of
the Company's business and will not conflict with, or result in a breach
of, any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument
to which the Company is now a party or by which it is bound, or result in
the violation of any law, rule, regulation, order, judgment or decree to
which the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity
regardless of whether enforceability is considered in a proceeding in
equity or at law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be
obtained or made by the Company in connection with the execution, delivery
or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency or
other tribunal, which would draw into question the validity of this
Agreement or the Purchase Agreement, or which, either in any one instance
or in the aggregate, would result in any material adverse change in the
ability of the Company to perform its obligations under this Agreement or
the Purchase Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that the representations and warranties set forth in Section 9.02
of the Purchase Agreement are true and correct as of the date hereof as if such
representations and warranties were made on the date hereof unless (i) otherwise
specifically stated in such representations and warranties or (ii) with respect
to the last sentence of (b), the first sentence of (c), (d), (e), the last
sentence of (f), (h), the last sentence of (i), (m), (n), the last sentence of
(p), (q), (r), the third and fourth sentences of (w), (x), (z), (hh), (ii),
(kk), (ll), (mm), (rr), (xx), (bbb) and (kkk), such representations and
warranties are true and correct as of the related Transfer Date (as defined in
the Purchase Agreement).
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee and
the Servicer acting on the Trust's behalf) in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3 and 4
hereof shall be as set forth in Subsection 9.03 of the Purchase Agreement as if
they were set forth herein (including without limitation the repurchase and
indemnity obligations set forth therein).
Miscellaneous
6. This Agreement shall be construed in accordance with the laws
of the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or
modified unless such waiver or modification is in writing and signed by the
party against whom such waiver or modification is sought to be enforced, with
the prior written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the
successors and assigns of the parties hereto and (ii) the Trust (including the
Trustee and the Servicer acting on the Trust's behalf). Any entity into which
Assignor, Assignee or Company may be merged or consolidated shall, without the
requirement for any further writing, be deemed Assignor, Assignee or Company,
respectively, hereunder.
9. Each of this Agreement and the Purchase Agreement shall
survive the conveyance of the Mortgage Loans and the assignment of the Purchase
Agreement (to the extent assigned hereunder) by Assignor to Assignee and by
Assignee to the Trust and nothing contained herein shall supersede or amend the
terms of the Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
[SELLER]
By:____________________________________
Name:_______________________________
Its:________________________________
IXIS REAL ESTATE CAPITAL INC.
By:____________________________________
Name:_______________________________
Its:________________________________
By:____________________________________
Name:_______________________________
Its:________________________________
[__________________________]
By:____________________________________
Name:_______________________________
Its:________________________________
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
EXHIBIT K
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"),
dated as of [_______], 200_, [among/between] IXIS Real Estate Capital Inc., a
New York corporation ("IXIS"), [_____________], a [_______________] (the
"Seller") and [_____________], a [_______________] [(the "Initial Servicer")].
WHEREAS, [________________] (the "Depositor"), is acting as
depositor and registrant with respect to the Prospectus, dated
[________________], and the Prospectus Supplement to the Prospectus,
[________________] (the "Prospectus Supplement"), relating to
[________________] Certificates (the "Certificates") to be issued pursuant to
a Pooling and Servicing Agreement, dated as of [________________] (the
"P&S"), among the Depositor, as depositor, [________________], as servicer
(the "Servicer"), and [________________], as trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S,
and [____________________] (the "Underwriter[s]") to enter into the Underwriting
Agreement, dated [____________________] (the "Underwriting Agreement") between
the Depositor and the Underwriter[s], Seller has agreed to provide for
indemnification and contribution on the terms and conditions hereinafter set
forth;
WHEREAS, IXIS purchased from Seller certain of the Mortgage Loans
underlying the Certificates (the "Mortgage Loans") from Seller pursuant to that
certain Third Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of May 1, 2006 (the "Purchase Agreement"), by and between
IXIS and Seller; and
WHEREAS, pursuant to Section 13 of the Purchase Agreement, Seller
has agreed to indemnify IXIS, the Depositor, the Underwriter[s] and their
respective affiliates, present and former directors, officers, employees and
agents.
NOW THEREFORE, in consideration of the agreements contained herein,
and other valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Seller and IXIS agree as follows:
1. Indemnification and Contribution.
(a) Seller [and Initial Servicer] agrees to indemnify and hold
harmless IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, and their respective present and former directors, officers,
employees and agents and each person, if any, who controls IXIS, the Depositor,
the Underwriter[s] or such affiliates within the meaning of either Section 15 of
the Securities Act of 1933, as amended (the "1933 Act"), or Section 20 of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), against any and
all losses, claims, damages or liabilities, joint or several, to which they or
any of them may become subject under the 1933 Act, the 1934 Act or other federal
or state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based in whole or in part upon (i) any violation of the
representation and warranty set forth in Section 2(vii) below or (ii) any untrue
statement or alleged untrue statement of a material fact contained in the
Prospectus Supplement, ABS Informational and Computational Material or in the
Free Writing Prospectus or any omission or alleged omission to state in the
Prospectus Supplement, ABS Informational and Computational Material or in the
Free Writing Prospectus 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, or any such untrue statement or omission or
alleged untrue statement or alleged omission made in any amendment of or
supplement to the Prospectus Supplement, ABS Informational and Computational
Material or the Free Writing Prospectus and agrees to reimburse IXIS, the
Depositor, the Underwriter[s] or such affiliates and each such officer,
director, employee, agent and controlling person promptly upon demand for any
legal or other expenses reasonably incurred by any of them in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that Seller [and Initial Servicer] shall be liable in any such case only to the
extent that any such loss, claim, damage, liability or action arises out of, or
is based upon, any untrue statement or alleged untrue statement or omission or
alleged omission of a material fact made in reliance upon and in conformity with
the Seller Information[ and Servicer Information]. The foregoing indemnity
agreement is in addition to any liability which Seller[ and the Initial
Servicer] may otherwise have to IXIS, the Depositor, the Underwriter[s] its
affiliates or any such director, officer, employee, agent or controlling person
of IXIS, the Depositor, the Underwriter[s] or their respective affiliates.
As used herein:
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act and
the 1934 Act, as amended from time to time.
"Free Writing Prospectus" means any written communication that
constitutes a "free writing prospectus," as defined in Rule 405 under the 1933
Act.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or
by the staff of the Commission, or as may be provided by the Commission or its
staff from time to time.
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines[ and/or servicing guidelines]
relating to the Mortgage Loans set forth in the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus [and
static pool information regarding mortgage loans originated or acquired by the
Seller [and included in the Prospectus Supplement, ABS Informational and
Computational Material, the Offering Circular or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].
["Servicer Information" means any information relating to Initial
Servicer, the Mortgage Loans and/or the servicing guidelines relating to the
Mortgage Loans set forth in the Prospectus Supplement, ABS Informational and
Computational Material or the Free Writing Prospectus [and static pool
information regarding mortgage loans originated or acquired by the Initial
Servicer [and included in the Prospectus Supplement, the Offering Circular,
ABS Informational and Computational Material or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].]
(b) Promptly after receipt by any indemnified party under this
Section 1 of notice of any claim or the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against any
indemnifying party under this Section 1, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 1 except to the extent it has
been materially prejudiced by such failure; and provided, further, however, that
the failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 1.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except as provided in
the following paragraph, the indemnifying party shall not be liable to the
indemnified party under this Section 1 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties.
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment.
Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for reasonable fees and expenses of counsel, the indemnifying
party agrees that it shall be liable for any settlement of any proceeding
effected without its written consent if (i) such settlement is entered into more
than 30 days after receipt by such indemnifying party of the aforesaid request
and (ii) such indemnifying party shall not have reimbursed the indemnified party
in accordance with such request prior to the date of such settlement.
(c) If the indemnification provided for in this Section 1 is
unavailable to an indemnified party, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities, in such proportion as is appropriate to reflect the relative fault
of the indemnifying party and the indemnified party, respectively, in connection
with the statements or omissions that result in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the indemnified party and indemnifying party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission and any other equitable considerations.
(d) The indemnity and contribution agreements contained in this
Section 1 and the representations and warranties set forth in Section 2 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by IXIS, the Depositor, the
Underwriter[s] their respective affiliates, directors, officers, employees or
agents or any person controlling IXIS, the Depositor, the Underwriter[s] or any
such affiliate and (iii) acceptance of and payment for any of the Offered
Certificates.
2. Representations and Warranties. Seller [and Initial Servicer]
represents and warrants that:
(i) Seller [and Initial Servicer] is validly existing and in good
standing under the laws of its jurisdiction of formation or incorporation,
as applicable, and has full power and authority to own its assets and to
transact the business in which it is currently engaged. Seller [and
Initial Servicer] is duly qualified to do business and is in good standing
in each jurisdiction in which the character of the business transacted by
it or any properties owned or leased by it requires such qualification and
in which the failure so to qualify would have a material adverse effect on
the business, properties, assets or condition (financial or otherwise) of
Seller [and Initial Servicer];
(ii) Seller [and Initial Servicer] is not required to obtain the
consent of any other person or any consent, license, approval or
authorization from, or registration or declaration with, any governmental
authority, bureau or agency in connection with the execution, delivery,
performance, validity or enforceability of this Agreement;
(iii) the execution, delivery and performance of this Agreement by
Seller [and Initial Servicer] will not violate any provision of any
existing law or regulation or any order decree of any court applicable to
Seller [and Initial Servicer] or any provision of the charter or bylaws of
Seller [and Initial Servicer], or constitute a material breach of any
mortgage, indenture, contract or other agreement to which Seller [and
Initial Servicer] is a party or by which it may be bound;
(iv) (a) no proceeding of or before any court, tribunal or
governmental body is currently pending or, (b) to the knowledge of Seller
[and Initial Servicer], threatened against Seller [and Initial Servicer]
or any of its properties or with respect to this Agreement or the Offered
Certificates, in either case, which would have a material adverse effect
on the business, properties, assets or condition (financial or otherwise)
of Seller [and Initial Servicer];
(v) Seller [and Initial Servicer] has full power and authority to
make, execute, deliver and perform this Agreement and all of the
transactions contemplated hereunder, and has taken all necessary corporate
action to authorize the execution, delivery and performance of this
Agreement. When executed and delivered, this Agreement will constitute the
legal, valid and binding obligation of each of Seller [and Initial
Servicer] enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally, by the availability of equitable remedies, and by
limitations of public policy under applicable securities law as to rights
of indemnity and contribution thereunder;
(vi) this Agreement has been duly executed and delivered by Seller
[and Initial Servicer];
(vii) the Due Diligence Answers given by the Indemnifying Party are
true, correct and complete in all material respects. "Due Diligence
Answers" means the answers given by the Seller to due diligence questions
asked by [______], which questions were prepared by [______]'s counsel
based upon the requirements of Regulation AB. Due Diligence Answers and
the related due diligence questions are evidenced by a writing that is
attached hereto as Exhibit A; and
(viii) the [Seller Information][Servicer Information] satisfies the
requirements of the applicable provisions of Regulation AB.
3. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to Seller [and Initial Servicer],
will be mailed, delivered or telegraphed and confirmed to First NLC
Financial Services, LLC, 000 Xxxx Xxxxxxxxx Xxxxxxxxx, Xxxxxxxx 0,
Xxxxxxxxx Xxxxx, Xxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxxxx, President;
or, if sent to IXIS, will be mailed, delivered or telegraphed and
confirmed to IXIS Real Estate Capital Inc., 0 Xxxx 00xx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: General Counsel.
4. Miscellaneous. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York without
giving effect to the conflict of laws provisions thereof. This Agreement
shall inure to the benefit of and be binding upon the parties hereto and
their successors and assigns and the controlling persons referred to
herein, and no other person shall have any right or obligation hereunder.
Neither this Agreement nor any term hereof may be changed, waived,
discharged or terminated orally, but only by an instrument in writing
signed by the party against whom enforcement of the change, waiver,
discharge or termination is sought. This Agreement may be executed in
counterparts, each of which when so executed and delivered shall be
considered an original, and all such counterparts shall constitute one and
the same instrument. Capitalized terms used but not defined herein shall
have the meanings provided in the P&S.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective officers hereunto duly authorized,
this __th day of [_____________].
IXIS REAL ESTATE CAPITAL INC.
By:____________________________________
Name:
Title:
By:____________________________________
Name:
Title:
[SELLER]
By:____________________________________
Name:
Title:
[INITIAL SERVICER]
By:____________________________________
Name:
Title:
EXHIBIT FF
FLEXPOINT AGREEMENTS
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated April 30, 2007
("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"), Xxxxxx Xxxxxxx
ABS Capital I Inc. ("Assignee") and FlexPoint Funding Corporation (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and
other valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Second Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of February 1, 2006, between the Assignor, as purchaser
(the "Purchaser"), and the Company, as seller, as amended by Amendment No. 1,
dated as of May 1, 2006, solely insofar as the Purchase Agreement relates to the
Mortgage Loans.
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 Purchase Agreement which are not the Mortgage Loans set forth on the
Mortgage Loan Schedule and are not the subject of this Agreement or (ii) the
rights of the Purchaser (a) under Section 13, Subsection 9.04 and Subsection
14.01 of the Purchase Agreement or (b) to any premium recapture (i.e., the
excess, if any, of the purchase price percentage over par) in connection with
any repurchase pursuant to Subsections 9.03 and 9.05 of the Purchase Agreement
or (iii) any right to require the Company to repurchase a Mortgage Loan pursuant
to Subsection 9.05(b) of the Purchase Agreement unless the related Mortgagor is
delinquent with respect to such Mortgage Loan's first Monthly Payment after
origination.
Recognition of the Company
2. 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 Purchase Agreement
(solely to the extent set forth herein) and this Agreement to Natixis Real
Estate Capital Trust 2007-HE2 (the "Trust") created pursuant to a Pooling and
Servicing Agreement, dated as of April 1, 2007 (the "Pooling Agreement"), among
the Assignee, the Assignor, Deutsche Bank National Trust Company, as trustee (in
such capacity, including its successors in interest and any successor trustees
under the Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National
Association, as securities administrator (in such capacity, including its
successors in interest and any successor securities administrators under the
Pooling Agreement, the "Securities Administrator"), master servicer (in such
capacity, including its successors in interest and any successor master
servicers under the Pooling Agreement, the "Master Servicer") and Saxon Mortgage
Services, Inc., as servicer (including its successors in interest and any
successor servicer under the Pooling Agreement, the "Servicer"). The Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the Mortgage Loans, (iii) the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf)
shall have all the rights and remedies available to the Assignor, insofar as
they relate to the Mortgage Loans, under the Purchase Agreement, including,
without limitation, the enforcement of the document delivery requirements set
forth in Section 6 of the Purchase Agreement, and shall be entitled to enforce
all of the obligations of the Company thereunder insofar as they relate to the
Mortgage Loans, and (iv) all references to the Purchaser, the Custodian or the
Bailee under the Purchase Agreement insofar as they relate to the Mortgage
Loans, shall be deemed to refer to the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf).
Neither the Company nor the Assignor shall amend or agree to amend, modify,
waiver, or otherwise alter any of the terms or provisions of the Purchase
Agreement which amendment, modification, waiver or other alteration would in any
way affect the Mortgage Loans or the Company's performance under the Purchase
Agreement with respect to the Mortgage Loans without the prior written consent
of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf) as of the date hereof that:
(a) The Company is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute,
deliver and perform its obligations under this Agreement and has full power
and authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(c) No consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is
required to be obtained or made by the Company in connection with the
execution, delivery or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation
pending or threatened against the Company, before any court, administrative
agency or other tribunal, which would draw into question the validity of
this Agreement or the Purchase Agreement, or which, either in any one
instance or in the aggregate, would result in any material adverse change
in the ability of the Company to perform its obligations under this
Agreement or the Purchase Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf), that the representations and
warranties set forth in Section 9.02 (other than (i) the clause "nor has any
payment under the Mortgage Loan been 30 days or more delinquent at any time
since the origination of the Mortgage Loan" or (ii) the last sentence of Section
9.02(b) as it applies to Due Dates after the date hereof) of the Purchase
Agreement are true and correct as of the date hereof as if such representations
and warranties were made on the date hereof unless otherwise specifically stated
in such representations and warranties.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) in connection with any breach of the representations and warranties made
by the Company set forth in Sections 3 and 4 hereof shall be as set forth in
Subsection 9.03 of the Purchase Agreement as if they were set forth herein
(including without limitation the repurchase and indemnity obligations set forth
therein); provided, however, that the Assignor specifically reserves and does
not assign to the Assignee hereunder any and all right, title and interest in
the Premium Percentage, if any, due in connection with the repurchase of a
Mortgage Loan pursuant to Subsections 9.03, 9.04 and 9.05, or any right to
require the Company to repurchase a Mortgage Loan pursuant to Subsection 9.05(b)
of the Purchase Agreement unless the related Mortgagor is delinquent with
respect to such Mortgage Loan's first Monthly Payment after origination.
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors
and assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf). Any entity into which Assignor, Assignee or Company may be merged or
consolidated shall, without the requirement for any further writing, be deemed
Assignor, Assignee or Company, respectively, hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive
the conveyance of the Mortgage Loans and the assignment of the Purchase
Agreement (to the extent assigned hereunder) by Assignor to Assignee and by
Assignee to the Trust and nothing contained herein shall supersede or amend the
terms of the Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
FLEXPOINT FUNDING CORPORATION
By: /s/Xxxxxx Xxxxx
----------------------------
Name: Xxxxxx Xxxxx
Its: EVP Secondary Marketing
NATIXIS REAL ESTATE CAPITAL INC.
By: /s/Xxxxxxx Xxxxxxx
----------------------------
Name: Xxxxxxx Xxxxxxx
Its: Managing Director
By:/s/Xxxxxxxxxxx Xxxxxx
----------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/Xxxxxxx Xxx
----------------------------
Name: Xxxxxxx Xxx
Its: Vice President
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
================================================================================
SECOND AMENDED AND RESTATED MORTGAGE LOAN
PURCHASE AND WARRANTIES AGREEMENT
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
FLEXPOINT FUNDING CORPORATION,
Seller
Dated as of February 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
================================================================================
TABLE OF CONTENTS
SECTION 1. Definitions....................................................
SECTION 2. Agreement to Purchase..........................................
SECTION 3. Mortgage Schedules.............................................
SECTION 4. Purchase Price.................................................
SECTION 5. Examination of Mortgage Files..................................
SECTION 6. Conveyance from Seller to Purchaser............................
Subsection 6.01 Conveyance of Mortgage Loans; Possession of
Servicing Files.....................................
Subsection 6.02 Books and Records.....................................
Subsection 6.03 Delivery of Mortgage Loan Documents...................
Subsection 6.04 Quality Control Procedures............................
Subsection 6.05 MERS Designated Mortgage Loans........................
SECTION 7. Servicing of the Mortgage Loans................................
SECTION 8. Transfer of Servicing..........................................
SECTION 9. Representations, Warranties and Covenants
of the Seller; Remedies for Breach.............................
Subsection 9.01 Representations and Warranties
Regarding the Seller..................................
Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans......................................
Subsection 9.03 Remedies for Breach of Representations and Warranties.
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full......
Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults............................................
Subsection 9.06 Purchaser's Right to Review...........................
SECTION 10. Closing. ....................................................
SECTION 11. Closing Documents..............................................
SECTION 12. Costs. ....................................................
SECTION 13. Cooperation of Seller with a
Reconstitution.................................................
SECTION 14. The Seller.....................................................
Subsection 14.01 Additional Indemnification by the Seller;
Third Party Claims........................
Subsection 14.02 Merger or Consolidation of the Seller.................
SECTION 15. Financial Statements...........................................
SECTION 16. Mandatory Delivery; Grant of Security Interest.................
SECTION 17. Notices........................................................
SECTION 18. Severability Clause............................................
SECTION 19. Counterparts...................................................
SECTION 20. Governing Law Jurisdiction; Consent to Service of Process......
SECTION 21. Intention of the Parties.......................................
SECTION 22. Successors and Assigns; Assignment of Purchase Agreement.......
SECTION 23. Waivers. ....................................................
SECTION 24. Exhibits. ....................................................
SECTION 25. General Interpretive Principles................................
SECTION 26. Reproduction of Documents......................................
SECTION 27. Further Agreements.............................................
SECTION 28. Recordation of Assignments of Mortgage.........................
SECTION 29. No Solicitation................................................
SECTION 30. Waiver of Trial by Jury........................................
SECTION 31. Compliance with Regulation AB..................................
Subsection 31.01 Intent of the Parties; Reasonableness.................
Subsection 31.02 Additional Representations and Warranties
of the Seller.......................................
Subsection 31.03 Information to Be Provided by the Seller...............
Subsection 31.04 Indemnification; Remedies.............................
EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF INTERIM SERVICING AGREEMENT
EXHIBIT C FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE INTERIM
SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G [RESERVED]
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I SELLER'S UNDERWRITING GUIDELINES
EXHIBIT J FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT K FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
SECOND AMENDED AND RESTATED MORTGAGE LOAN
PURCHASE AND WARRANTIES AGREEMENT
This SECOND AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT (the "Agreement"), dated as of February 1, 2006, by and
between IXIS Real Estate Capital Inc., a New York corporation, having an office
at 0 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Purchaser"),
and FlexPoint Funding Corporation, a California corporation, having an office at
00 Xxxxxxxxx Xxxx, Xxxxx 000, Xxxxxx, Xxxxxxxxxx 00000 (the "Seller").
W I T N E S S E T H:
WHEREAS, the Purchaser and the Seller are parties to that certain
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of October 1, 2005 (the "Original Agreement"), between the Purchaser and the
Seller.
WHEREAS, at the present time, the Purchaser and the Seller desire to
amend the Original Agreement to make certain modifications as set forth herein
with respect to all Mortgage Loans acquired pursuant to this Agreement or the
Original Agreement.
NOW, THEREFORE, in consideration of the premises and mutual
agreements set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Purchaser and the
Seller agree as follows:
SECTION 1 Definitions. For purposes of this Agreement the following
capitalized terms shall have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan,
those mortgage servicing practices of prudent mortgage lending institutions
which service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage
Loan purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other
Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac
Transfer.
Agreement: This Second and Amended Mortgage Loan Purchase
and Warranties Agreement and all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its
successors in interest.
Appraised Value: (i) With respect to any First Lien Loan,
the value of the related Mortgaged Property based upon the appraisal made, if
any, for the originator at the time of origination of the Mortgage Loan or
the sales price of the Mortgaged Property at such time of origination,
whichever is less; provided, however, that in the case of a refinanced
Mortgage Loan, such value is based solely upon the appraisal made, if any, at
the time of origination of such refinanced Mortgage Loan, and (ii) with
respect to any Second Lien Loan, the value, determined pursuant to the
Seller's Underwriting Guidelines, of the related Mortgaged Property as of the
origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in
Subsection 6.01.
Assignment of Mortgage: An 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 the sale of the Mortgage to the Purchaser.
Balloon Mortgage Loan: Any Mortgage Loan that requires only
payments of interest until the stated maturity date of the Mortgage Loan or
the Monthly Payments of principal which (not including the payment due on its
stated maturity date) are based on an amortization schedule that would be
insufficient to fully amortize the principal thereof by stated maturity date
of the Mortgage Loan.
Business Day: Any day other than (i) a Saturday or Sunday,
or (ii) a day on which banking and savings and loan institutions, in the
State of New York or the state in which the Interim Servicer's servicing
operations are located, are authorized or obligated by law or executive order
to be closed.
Closing Date: The date or dates on which the Purchaser from
time to time shall purchase and the Seller from time to time shall sell the
Mortgage Loans listed on the related Mortgage Loan Schedule with respect to the
related Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan,
the ratio, expressed as a percentage, of the (a) sum of (i) the outstanding
principal balance of the Second Lien Loan and (ii) the outstanding principal
balance as of such date of any mortgage loan or mortgage loans that are
senior or equal in priority to the Second Lien Loan and which are secured by
the same Mortgaged Property to (b) the Appraised Value and (2) any First Lien
Loan, the ratio, expressed as a percentage, of the (a) sum of (i) the
outstanding principal balance of the First Lien Loan and (ii) the outstanding
principal balance as of such date of any mortgage loan or mortgage loans that
are junior or equal in priority to the First Lien Loan and which are secured
by the same Mortgaged Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange
Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate
Mortgage Loan purchased pursuant to this Agreement which contains a provision
whereby the Mortgagor is permitted to convert the Adjustable Rate Mortgage
Loan to a Fixed Rate Mortgage Loan in accordance with the terms of the
related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered
pursuant to Appendix E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created
and maintained pursuant to Section 2.04 of the Interim Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified
therein).
Custodial Agreement: The agreement governing the retention
of the originals of each Mortgage Note, Mortgage, Assignment of Mortgage and
other Mortgage Loan Documents, to be executed between the Purchaser and the
Custodian and to be dated as of the related Cut-Off Date.
Custodian: The custodian under the Custodial Agreement, or
its successor in interest or assigns, or any successor to the Custodian under
the Custodial Agreement, as therein provided. If at any time there is no
Custodial Agreement in effect with respect to a Mortgage Loan, all references
to the Custodian herein and in the Interim Servicing Agreement shall be
deemed to refer to the Purchaser (or its designee) with respect to such
Mortgage Loan.
Cut-off Date: The date or dates designated as such on the
related Mortgage Loan Schedule with respect to the related Mortgage Loan
Package.
Deemed Material Breach Representation: Each representation
identified as such in Subsection 9.02.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased
or replaced or to be replaced with a Qualified Substitute Mortgage Loan by
the Seller in accordance with the terms of this Agreement.
Delinquency Collection Policies and Procedures: The
delinquency collection policies and procedures of the Seller, a copy of which
is attached to the Interim Servicing Agreement.
Depositor: The depositor, as such term is defined in
Regulation AB, with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim
Servicing Agreement (with respect to each Mortgage Loan, for an interim
period, as specified therein).
Due Date: The day of the month on which the Monthly Payment
is due on a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a
federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is a subsidiary of a holding
company, the short-term unsecured debt obligations of such holding company)
are rated A-1 by Standard & Poor's or Prime-1 by Xxxxx'x (or a comparable
rating if another Rating Agency is specified by the Purchaser by written
notice to the Seller) at the time any amounts are held on deposit therein,
(ii) an account or accounts the deposits in which are fully insured by the
FDIC, or (iii) a trust account or accounts maintained with a federal or state
chartered depository institution or trust company acting in its fiduciary
capacity.
Escrow Account: The separate account or accounts created
and maintained pursuant to Section 2.06 of the Interim Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified
therein).
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.
Exchange Act: The Securities Exchange Act of 1934, as
amended.
Xxxxxx Mae: The Federal National Mortgage Association and
its successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the
Xxxxxx Xxx Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 13 hereof.
FDIC: The Federal Deposit Insurance Corporation and its
successors in interest.
FHA: The Federal Housing Administration, an agency within
the United States Department of Housing and Urban Development and its successors
in interest and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien
Mortgage on the related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
Fixed Rate Mortgage Loan: A fixed rate mortgage loan
purchased pursuant to this Agreement.
Xxxxxxx Mac: The Federal Home Loan Mortgage Corporation and
its successors in interest.
Xxxxxxx Mac Transfer: As defined in Section 13 hereof.
GEMICO: General Electric Mortgage Insurance Corporation, a
North Carolina corporation and its successors in interest.
Gross Margin: With respect to each Adjustable Rate Mortgage
Loan, the fixed percentage amount set forth in the related Mortgage Note
which amount is added to the Index in accordance with the terms of the
related Mortgage Note to determine on each Interest Rate Adjustment Date the
Mortgage Interest Rate for such Mortgage Loan.
High Cost Loan: A Mortgage Loan (a) covered by the Home
Ownership and Equity Protection Act of 1994, (b) classified as a "high cost
home," "threshold," "covered," "high risk home," "predatory" or similar loan
under any other 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) or (c) categorized as
High Cost pursuant to Appendix E of Standard & Poor's Glossary. For avoidance
of doubt, the parties agree that this definition shall apply to any law
regardless of whether such law is presently, or in the future becomes, the
subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as Home Loan
pursuant to Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or
any federal agency or official thereof which may from time to time succeed to
the functions thereof with regard to FHA Mortgage Insurance. The term "HUD,"
for purposes of this Agreement, is also deemed to include subdivisions
thereof such as the FHA and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan,
a rate per annum set forth on Exhibit B to each related Assignment and
Conveyance Agreement.
Insurance Proceeds: With respect to each Mortgage Loan,
proceeds of insurance policies insuring the Mortgage Loan or the related
Mortgaged Property.
Interest Rate Adjustment Date: With respect to each
Adjustable Rate Mortgage Loan, the date, specified in the related Mortgage Note
and the Mortgage Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated
Mortgage Loan, the Person named on the MERS(R) System as the interim funder
pursuant to the MERS Procedures Manual.
Interim Servicer: FlexPoint Funding Corporation, a
California corporation, and its successors in interest, and any successor
interim servicer under the Interim Servicing Agreement.
Interim Servicing Agreement: The agreement, attached as
Exhibit B hereto, to be entered into by the Purchaser and the Interim
Servicer, providing for the Interim Servicer to service the Mortgage Loans
for an interim period as specified by the Interim Servicing Agreement.
Investor: With respect to each MERS Designated Mortgage
Loan, the Person named on the MERS(R) System as the investor pursuant to the
MERS Procedures Manual.
Lifetime Rate Cap: The provision of each Mortgage Note
related to an Adjustable Rate Mortgage Loan which provides for an absolute
maximum Mortgage Interest Rate thereunder. The Mortgage Interest Rate during
the terms of each Adjustable Rate Mortgage Loan shall not at any time exceed
the Mortgage Interest Rate at the time of origination of such Adjustable Rate
Mortgage Loan by more than the amount per annum set forth on the related
Mortgage Loan Schedule.
Liquidation Proceeds: Cash received in connection with the
liquidation of a defaulted Mortgage Loan, whether through the sale or
assignment of such Mortgage Loan, trustee's sale, foreclosure sale or
otherwise, or the sale of the related Mortgaged Property if the Mortgaged
Property is acquired in satisfaction of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage
Loan, the ratio (expressed as a percentage) of the outstanding principal
amount of the Mortgage Loan as of the Cut-off Date (unless otherwise
indicated), to the Appraised Value of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a
Delaware corporation, and its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which
(a) the Seller has designated or will designate MERS as, and has taken or
will take such action as is necessary to cause MERS to be, the mortgagee of
record, as nominee for the Seller, in accordance with MERS Procedure Manual
and (b) the Seller has designated or will designate the Purchaser as the
Investor on the MERS(R) System.
MERS Procedure Manual: The MERS Procedures Manual, as it
may be amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS
Designated Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as
more particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal
and interest on a Mortgage Loan.
Moody's: Xxxxx'x Investors Service, Inc. and its successors
in interest.
Mortgage: The mortgage, deed of trust or other instrument
securing a Mortgage Note, which creates a first lien, in the case of a First
Lien Loan, or a second lien, in the case of a Second Lien Loan, on the Mortgaged
Property.
Mortgage File: The items pertaining to a particular
Mortgage Loan referred to in Exhibit A annexed hereto, and any additional
documents required to be added to the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: The annual rate of interest borne
on a Mortgage Note with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule,
which Mortgage Loan includes without limitation the Mortgage File, the
Monthly Payments, Principal Prepayments, Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds, Servicing Rights, 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 required to be
delivered to the Custodian pursuant to Section 6.03 hereof with respect to any
Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which
shall be purchased by the Purchaser from the Seller from time to time on each
Closing Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting
forth the following information with respect to each Mortgage Loan in the
related Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying
number; (2) the Mortgagor's 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 investment property;
(5) the number and type of residential units constituting the Mortgaged Property
(i.e., a single family residence, a 2-4 family residence, a unit in a
condominium project or a unit in a planned unit development, manufactured
housing); (6) the Mortgage Loan origination date; (7) the original months to
maturity or the remaining months to maturity from the related Cut-off Date, in
any case 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 Loan-to-Value Ratio at origination; (9) with respect to First
Lien Loans, the LTV and with respect to Second Lien Loans, the CLTV; (10) the
Mortgage Interest Rate as of the related Cut-off Date; (11) the date on which
the Monthly Payment was due on the Mortgage Loan and, if such date is not
consistent with the Due Date currently in effect, such Due Date; (12) the stated
maturity date; (13) the amount of the Monthly Payment as of the related Cut-off
Date; (14) the last payment date as of which a payment was actually applied to
the outstanding principal balance; (15) the original principal amount of the
Mortgage Loan; (16) the 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 and collected on or before the Cut-off Date; (17) the Interest
Rate Adjustment Date; (18) the Gross Margin; (19) the Lifetime Rate Cap under
the terms of the Mortgage Note; (20) a code indicating the type of Index; (21)
the Mortgage Interest Rate as of origination; (22) the type of Mortgage Loan
(i.e., fixed-rate, adjustable-rate, First Lien, Second Lien); (23) a code
indicating the purpose of the loan (i.e., purchase, rate and term refinance,
equity take-out refinance); (24) a code indicating the documentation style
(i.e., full or stated income); (25) the loan credit classification (as described
in the Underwriting Guidelines); (26) the applicable Cut-off Date; (27) the
applicable Closing Date; (28) a code indicating whether the Mortgage Loan is a
Home Loan; (29) the credit risk score (FICO score); (30) with respect to the
related Mortgagor, the debt-to-income ratio; (31) with respect to Second Lien
Loans, the outstanding principal balance of the superior lien; (32) the
Appraised Value of the Mortgaged Property; (33) the sale price of the Mortgaged
Property if the Mortgage Loan was originated in connection with the purchase of
the Mortgaged Property; (34) the Periodic Rate Cap under the terms of the
Mortgage Note; (35) the Periodic Rate Floor under the terms of the Mortgage
Note; (36) whether such Mortgage Loan provides for a prepayment penalty; (37)
the prepayment penalty period of such Mortgage Loan, if applicable; (38) a
description of the type of prepayment penalty, if applicable; (39) the MERS
Identification Number; (40) whether the Mortgagor represented that the Mortgagor
would occupy the Mortgaged Property as its primary residence and (41) a code
indicating if the Mortgage Loan is a Balloon Mortgage Loan. With respect to the
Mortgage Loans in the aggregate, the Mortgage Loan Schedule shall set forth the
following information, as of the related Cut-off Date: (1) the number of
Mortgage Loans; (2) the current aggregate outstanding principal balance of the
Mortgage Loans; (3) the weighted average Mortgage Interest Rate of the Mortgage
Loans; and (4) the weighted average maturity of the Mortgage Loans.
Mortgage Note: The note or other evidence of the
indebtedness of a Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the
Mortgagor's real property securing repayment of a related Mortgage Note,
consisting of an unsubordinated estate in fee simple or, 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, in
a single parcel or multiple parcels of real property improved by a
residential dwelling as further described in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its
successors in interest.
Officer's Certificate: A certificate signed by the Chairman
of the Board or the Vice Chairman of the Board or a President or a Vice
President and by the Treasurer or the Secretary or one of the Assistant
Treasurers or Assistant Secretaries of the Seller, and delivered to the
Purchaser as required by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may
be counsel for the Seller, reasonably acceptable to the Purchaser, provided
that any Opinion of Counsel relating to (a) the qualification of any account
required to be maintained pursuant to this Agreement as an Eligible Account,
(b) qualification of the Mortgage Loans in a REMIC or (c) compliance with the
REMIC Provisions, must be (unless otherwise stated in such Opinion of
Counsel) an opinion of counsel who (i) is in fact independent of the Seller
and any servicer of the Mortgage Loans, (ii) does not have any material
direct or indirect financial interest in the Seller or any servicer of the
Mortgage Loans or in an Affiliate of either and (iii) is not connected with
the Seller or any servicer of the Mortgage Loans as an officer, employee,
director or person performing similar functions.
OTS: Office of Thrift Supervision and its successors in
interest.
Periodic Rate Cap: With respect to each Adjustable Rate
Mortgage Loan, the provision of each Mortgage Note which provides for an
absolute maximum amount by which the Mortgage Interest Rate therein may
increase on an Interest Rate Adjustment Date above the Mortgage Interest Rate
previously in effect.
Periodic Rate Floor: With respect to each Adjustable Rate
Mortgage Loan, the provision of each Mortgage Note which provides for an
absolute maximum amount by which the Mortgage Interest Rate therein may
decrease on an Interest Rate Adjustment Date below the Mortgage Interest Rate
previously in effect.
Person: Any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political
subdivision thereof.
Preliminary Mortgage Schedule: As defined in Section 3.
Premium Percentage: With respect to any Mortgage Loan, a
percentage equal to the excess of the Purchase Price Percentage over 100%.
Principal Prepayment: Any payment or other recovery of
principal on a Mortgage Loan which is received in advance of its scheduled
Due Date, including any prepayment penalty or premium thereon and which is
not accompanied by an amount of interest representing scheduled interest due
on any date or dates in any month or months subsequent to the month of
prepayment.
Purchase Price: The price paid on the related Closing Date
by the Purchaser to the Seller in exchange for the Mortgage Loans purchased
on such Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Those certain
agreements setting forth the general terms and conditions of the transaction
consummated herein and identifying the Mortgage Loans to be purchased from
time to time hereunder, by and among the Seller, the Purchaser and the
Interim Servicer (if applicable). All of the individual Purchase Price and
Terms Agreements shall collectively be referred to as the "Purchase Price and
Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage
Loan, an amount equal to the percentage of par as stated in the Purchase Price
and Terms Agreement (subject to adjustment as provided therein) related to such
Mortgage Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York
corporation, and its successors in interest and assigns, or any successor to
the Purchaser under this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller
purchased Mortgage Loans, provided that the following conditions are
satisfied: (i) such Mortgage Loans were originated pursuant to an agreement
between the Seller and such Person that contemplated that such Person would
underwrite mortgage loans from time to time, for sale to the Seller, in
accordance with underwriting guidelines designated by the Seller ("Designated
Guidelines") or guidelines that do not vary materially from such Designated
Guidelines; (ii) such Mortgage Loans were in fact underwritten as described
in clause (i) above and were acquired by the Seller within one hundred eighty
(180) days after origination; (iii) either (x) the Designated Guidelines
were, at the time such Mortgage Loans were originated, used by the Seller in
origination of mortgage loans of the same type as the Mortgage Loans for the
Seller's own account or (y) the Designated Guidelines were, at the time such
Mortgage Loans were underwritten, designated by the Seller on a consistent
basis for use by lenders in originating mortgage loans to be purchased by the
Seller; and (iv) the Seller employed, at the time such Mortgage Loans were
acquired by the Seller, pre-purchase or post-purchase quality assurance
procedures (which may involve, among other things, review of a sample of
mortgage loans purchased during a particular time period or through
particular channels) designed to ensure that Persons from which it purchased
mortgage loans properly applied the underwriting criteria designated by the
Seller.
Qualified Substitute Mortgage Loan: A mortgage loan
eligible to be substituted by the Seller for a Deleted Mortgage Loan which
must, on the date of such substitution, (i) have an outstanding principal
balance, after deduction of all scheduled payments due in the month of
substitution (or in the case of a substitution of more than one mortgage loan
for a Deleted Mortgage Loan, an aggregate principal balance), not in excess
of the outstanding principal balance of the Deleted Mortgage Loan (the amount
of any shortfall will be deposited in the Custodial Account by the Seller in
the month of substitution); (ii) have a Mortgage Interest Rate not less than
and not more than 1% greater than the Mortgage Interest Rate of the Deleted
Mortgage Loan; (iii) have a remaining term to maturity not greater than and
not more than one year less than that of the Deleted Mortgage Loan; (iv) be
of the same type as the Deleted Mortgage Loan (i.e., fixed-rate,
adjustable-rate with same Periodic Rate Cap, Index and lien priority); and
(v) comply with each representation and warranty (respecting individual
Mortgage Loans) set forth in Section 9 hereof.
Rating Agency: Any of Fitch, Moody's or Standard & Poor's,
or their respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole
Loan Transfer.
Reconstitution Agreements: The agreement or agreements
entered into by the Seller and/or the Interim Servicer and the Purchaser
and/or certain third parties on the Reconstitution Date or Dates with respect
to any or all of the Mortgage Loans sold hereunder, in connection with a
Whole Loan Transfer, Agency Transfer or a Securitization Transaction pursuant
to Section 13, including, but not limited to, a seller's warranties and
servicing agreement with respect to a Whole Loan Transfer, and a trust and
servicing agreement, pooling and servicing agreement and/or seller/servicer
agreements and related custodial/trust agreement and documents with respect
to a Securitization Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have
been provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531
(Jan. 7, 2005)) or by the staff of the Commission, or as may be provided by
the Commission or its staff from time to time.
REMIC: A "real estate mortgage investment conduit" within
the meaning of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law
relating to 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 date specified in the Interim
Servicing Agreement (with respect to each Mortgage Loan, for an interim
period, as specified therein).
Repurchase Price: With respect to any Mortgage Loan for
which a breach of a representation or warranty from the Agreement or the
Interim Servicing Agreement is found, a price equal to the then outstanding
principal balance of the Mortgage Loan to be repurchased, plus accrued
interest thereon at the Mortgage Interest Rate from the date to which
interest had last been paid through the date of such repurchase, plus the
amount of any outstanding advances owed to any servicer, and plus all costs
and expenses incurred by the Purchaser or any servicer arising out of or
based upon such breach, including without limitation costs and expenses
incurred in the enforcement of the Seller's repurchase obligation hereunder,
and plus, in the event a Mortgage Loan is repurchased during the first twelve
months following the related Closing Date, an amount equal to the Premium
Percentage multiplied by the outstanding principal balance of such Mortgage
Loan as of the date of such repurchase.
RESPA: Real Estate Settlement Procedures Act, as amended
from time to time.
Second Lien Loan: A Mortgage Loan secured by a second lien
Mortgage on the related Mortgaged Property.
Securities Act: The federal Securities Act of 1933, as
amended.
Securitization Transaction: Any transaction involving
either (1) a sale or other transfer of some or all of the Mortgage Loans
directly or indirectly to an issuing entity in connection with an issuance of
publicly-offered or privately-placed, rated or unrated mortgage backed
securities or (2) an issuance of publicly-offered or privately-placed, rated
or unrated securities, the payments on which are determined primarily by
reference to one or more portfolios of residential mortgage loans consisting,
in whole or in part, of some or all of the Mortgage Loans.
Seller: FlexPoint Funding Corporation, a California
corporation, and its successors in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan subject
to the Interim Servicing Agreement, an amount equal to 0.50% per annum
computed on the basis of the outstanding principal balance of the related
Mortgage Loan. Such fee shall be payable monthly and shall be pro rated for
any portion of a month during which the Mortgage Loan is serviced by the
Interim Servicer under the Interim Servicing Agreement. The obligation of the
Purchaser to pay the Servicing Fee is limited to, and the Servicing Fee is
payable solely from, the interest portion (including recoveries with respect
to interest from Liquidation Proceeds, to the extent permitted by this
Agreement) of such Monthly Payment collected by the Interim Servicer, or as
otherwise provided under this Agreement.
Servicing File: With respect to each Mortgage Loan, the
file retained by the Interim Servicer consisting of originals of all
documents in the Mortgage File which are not delivered to the Purchaser or
the Custodian and copies of the Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and
all rights to service the Mortgage Loans; (b) any payments to or monies
received by the Interim Servicer for servicing the Mortgage Loans; (c) any
late fees, penalties or similar payments with respect to the Mortgage Loans;
(d) all agreements or documents creating, defining or evidencing any such
servicing rights to the extent they relate to such servicing rights and all
rights of the Interim Servicer thereunder; (e) Escrow Payments or other
similar payments with respect to the Mortgage Loans and any amounts actually
collected by the Interim Servicer with respect thereto; (f) all accounts and
other rights to payment related to any of the property described in this
paragraph; and (g) any and all documents, files, records, servicing files,
servicing documents, servicing records, data tapes, computer records, or
other information pertaining to the Mortgage Loans or pertaining to the past,
present or prospective servicing of the Mortgage Loans.
Sponsor: The sponsor, as such term is defined in Regulation
AB, with respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R)
Glossary, as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any
date of determination, (i) the principal balance of such Mortgage Loan at the
related Cut-off Date after giving effect to payments of principal due on or
before such date, to the extent actually received, minus (ii) all amounts
previously distributed to the Purchaser with respect to the related Mortgage
Loan representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as
described in Item 1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage
Loans designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Sections 9.03 and 14.01.
Third-Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its
designee, shall receive the transfer of servicing responsibilities and begin
to perform the servicing of the Mortgage Loans with respect to the related
Mortgage Loan Package, and the Interim Servicer shall cease all servicing
responsibilities. Such date shall occur on the day indicated by the Purchaser
to the Interim Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: The underwriting guidelines of the
Seller, a copy of which is attached hereto as Exhibit I and a then-current copy
of which shall be attached as an Exhibit to the related Assignment and
Conveyance.
VA: The Department of Veterans Affairs, an agency of the
United States of America, or any successor thereto including the Administrator
of Veterans Affairs.
Whole Loan Transfer: Any sale or transfer of some or all of
the Mortgage Loans, other than a Securitization Transaction.
SECTION 2 Agreement to Purchase. The Seller agrees to sell from time
to time, and the Purchaser agrees to purchase from time to time, Mortgage Loans
having an aggregate principal balance on the related Cut-off Date in an amount
as set forth in the related Purchase Price and Terms Agreement, or in such other
amount as agreed by the Purchaser and the Seller as evidenced by the actual
aggregate principal balance of the Mortgage Loans accepted by the Purchaser on
each Closing Date.
SECTION 3 Mortgage Schedules. The Seller from time to time shall
provide the Purchaser with certain information constituting a preliminary
listing of the Mortgage Loans to be purchased on each Closing Date in accordance
with the related Purchase Price and Terms Agreement and this Agreement (each, a
"Preliminary Mortgage Schedule").
The Seller shall deliver the Mortgage Loan Schedule for the Mortgage
Loans to be purchased on a particular Closing Date to the Purchaser at least two
(2) Business Days prior to the related Closing Date. The Mortgage Loan Schedule
shall be the related Preliminary Mortgage Schedule with those Mortgage Loans
which the Seller has not funded prior to the related Closing Date deleted.
SECTION 4 Purchase Price. The Purchase Price for the Mortgage Loans
shall be equal to (a) the Purchase Price Percentage multiplied by the Cut-off
Date Balance, plus (b) accrued and unpaid interest on such principal balance at
the weighted average Mortgage Interest Rate (net of the Servicing Fee) of those
Mortgage Loans from the related Cut-off Date through the day prior to the
related Closing Date, inclusive. For purposes hereof, "Cut-off Date Balance"
means the aggregate principal balance, as of the related Cut-off Date, of the
Mortgage Loans listed on the related Mortgage Loan Schedule, after application
of scheduled payments of principal due on or before the related Cut-off Date, to
the extent such payments were actually received, together with any unscheduled
principal payments collected prior to the Cut-off Date; provided, however, that
payments of scheduled principal and interest paid prior to the Cut-off Date, but
to be applied on a due date beyond the related Cut-off Date, shall not be
applied to the principal balance as of the related Cut-off Date. If so provided
in the related Purchase Price and Terms Agreement, portions of the Mortgage
Loans shall be priced separately. The Purchase Price as so determined shall be
paid to the Seller on the related Closing Date by wire transfer of immediately
available funds to an account designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, 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, to the extent actually collected, together with any
unscheduled principal prepayments collected prior to the Cut-off Date; provided,
however, that payments of scheduled principal and interest paid prior to the
Cut-off Date, but to be applied on 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 Seller 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
Seller to the Purchaser.
SECTION 5 Examination of Mortgage Files. At least seven 14 days
prior to the related Closing Date, the Seller shall (i) either (a) deliver to
the Purchaser or its designee in escrow, for examination with respect to each
Mortgage Loan to be purchased, the related Mortgage File, including a copy of
the Assignment of Mortgage (except with respect to each MERS Designated Mortgage
Loan), pertaining to each Mortgage Loan, or (b) make the related Mortgage File
available to the Purchaser for examination at such other location as shall
otherwise be acceptable to the Purchaser and (ii) deliver to the Purchaser
copies of the credit and servicing files (collectively, the "Credit Files").
Such examination of the Mortgage Files may be made by the Purchaser or its
designee at any reasonable time before or after the related Closing Date. If the
Purchaser makes such examination prior to the related Closing Date and
determines, in its sole discretion, that any Mortgage Loans are unacceptable to
the Purchaser for any reason, such Mortgage Loans shall be deleted from the
related Mortgage Loan Schedule, and may be replaced by a Qualified Substitute
Mortgage Loan (or Loans) acceptable to the Purchaser. The Purchaser may, at its
option and without notice to the Seller, purchase some or all of the Mortgage
Loans without conducting any partial or complete examination. The fact that the
Purchaser or its designee has conducted or has failed to conduct any partial or
complete examination of the Mortgage Files or the Credit Files shall not impair
in any way the Purchaser's (or any of its successor's) rights to demand
repurchase, substitution or other remedy as provided in this Agreement. In the
event that the Seller fails to deliver the Credit Files with respect to any
Mortgage Loan, the Seller shall, upon the request of the Purchaser, repurchase
such Mortgage Loan at the price and in the manner specified in Subsection 9.03.
SECTION 6 Conveyance from Seller to Purchaser.
Subsection 6.01 Conveyance of Mortgage Loans; Possession of
Servicing Files.
The Seller, simultaneously with the delivery of the Mortgage Loan
Schedule with respect to the related Mortgage Loan Package to be purchased on
each Closing Date, shall execute and deliver an Assignment and Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment and
Conveyance Agreement"). The Seller shall cause the Servicing File retained by
the Interim Servicer pursuant to this Agreement to be appropriately identified
in the Seller's computer system and/or books and records, as appropriate, to
clearly reflect the sale of the related Mortgage Loan to the Purchaser. The
Seller shall cause the Interim Servicer to release from its custody the contents
of any Servicing File retained by it only in accordance with this Agreement or
the Interim Servicing Agreement, except when such release is required in
connection with a repurchase of any such Mortgage Loan pursuant to Subsection
9.03.
Subsection 6.02 Books and Records. Record title to each Mortgage as
of the related Closing Date shall be in the name of the Seller, the Purchaser or
one or more designees of the Purchaser, as the Purchaser shall select.
Notwithstanding the foregoing, each Mortgage and related Mortgage Note shall be
possessed solely by the Purchaser or the appropriate designee of the Purchaser,
as the case may be. All rights arising out of the Mortgage Loans including, but
not limited to, all funds received by the Seller or the Interim Servicer after
the related Cut-off Date on or in connection with a Mortgage Loan shall be
vested in the Purchaser or one or more designees of the Purchaser; provided,
however, that all funds received on or in connection with a Mortgage Loan shall
be received and held by the Seller or the Interim Servicer in trust for the
benefit of the Purchaser or the appropriate designee of the Purchaser, as the
case may be, as the owner of the Mortgage Loans pursuant to the terms of this
Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to be
responsible for maintaining, and shall maintain, a complete set of books and
records for each Mortgage Loan which shall be marked clearly to reflect the
ownership of each Mortgage Loan by the Purchaser. In particular, the Seller
shall or shall cause the Interim Servicer to maintain in its possession,
available for inspection by the Purchaser, 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 Xxxxxxx Mac, including
but not limited to documentation as to the method used in determining the
applicability of the provisions of the National Flood Insurance Act of 1968, as
amended, to the Mortgaged Property, documentation evidencing insurance coverage
and periodic inspection reports, as required by the Xxxxxx Mae Guides. To the
extent that original documents are not required for purposes of realization of
Liquidation Proceeds or Insurance Proceeds, documents maintained by the Seller
or the Interim Servicer may be in the form of microfilm or microfiche so long as
the Seller or the Interim Servicer complies with the requirements of the Xxxxxx
Xxx Guides.
Subsection 6.03 Delivery of Mortgage Loan Documents. The Seller
shall deliver and release to the Custodian no later than seven (7) Business Days
prior to the related Closing Date those Mortgage Loan Documents set forth on
Exhibit A hereto with respect to each Mortgage Loan set forth on the related
Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian from and after the Closing Date.
The Seller shall or shall cause the Interim Servicer to forward to
the Custodian, or to such other Person as the Purchaser shall designate in
writing, original documents evidencing an assumption, modification,
consolidation or extension of any Mortgage Loan entered into in accordance with
this Agreement within two weeks of their execution, provided, however, that the
Seller shall provide the Custodian, or to such other Person as the Purchaser
shall designate in writing, with a certified true copy of any such document
submitted for recordation within two weeks of its execution, and shall promptly
provide the original of any document submitted for recordation or a copy of such
document certified by the appropriate public recording office to be a true and
complete copy of the original within ninety days of its submission for
recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within 90 days following the Closing Date (other
than with respect to the Assignments of Mortgage which shall be delivered to the
Custodian in blank and recorded subsequently by the Purchaser or its designee),
and in the event that the Seller does not cure such failure within 30 days of
discovery or receipt of written notification of such failure from the Purchaser,
the related Mortgage Loan shall, upon the request of the Purchaser, be
repurchased by the Seller at the price and in the manner specified in Subsection
9.03. The foregoing repurchase obligation shall not apply in the event that the
Seller cannot deliver such original or copy of any document submitted for
recordation to the appropriate public recording office within the specified
period due to a delay caused by the recording office in the applicable
jurisdiction, provided that (i) the Seller shall deliver a recording receipt of
such recording office or, if such recording receipt is not available, an
officer's certificate of a servicing officer of the Seller, confirming that such
documents have been accepted for recording (upon request of the Purchaser and
delivery by the Purchaser to the Seller of a schedule of the related Mortgage
Loans, the Seller shall reissue and deliver to the Purchaser or its designee
said officer's certificate relating to the related Mortgage Loans), and (ii)
such document is delivered within twelve (12) months of the related Closing
Date.
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee. The Purchaser or the Purchaser's designee
shall be responsible for recording the Assignments of Mortgage and shall be
reimbursed by the Seller for the costs associated therewith pursuant to the
preceding sentence.
Subsection 6.04 Quality Control Procedures. The Seller shall, or
shall cause the Interim Servicer to, have an internal quality control program
that verifies in a manner consistent with accepted industry procedures, on a
regular basis, the existence and accuracy of the legal documents, credit
documents, property appraisals, and underwriting decisions. The program shall
include evaluating and monitoring the overall quality of the Seller's loan
production and the servicing activities of the Interim Servicer. The program is
to ensure that the Mortgage Loans are originated and serviced in accordance with
Accepted Servicing Practices and the Underwriting Guidelines; guard against
dishonest, fraudulent, or negligent acts; and guard against errors and omissions
by officers, employees, or other authorized persons.
Subsection 6.05 MERS Designated Mortgage Loans. With respect to each
MERS Designated Mortgage Loan, the Seller shall, on or prior to the related
Closing Date, designate the Purchaser as the Investor and the Custodian as
custodian, and no Person shall be listed as Interim Funder on the MERS System.
In addition, on or prior to the related Closing Date, Seller shall provide the
Custodian and the Purchaser with a MERS Report listing the Purchaser as the
Investor, the Custodian as custodian and no Person as Interim Funder with
respect to each MERS Designated Mortgage Loan.
SECTION 7 Servicing of the Mortgage Loans. The Mortgage Loans have
been sold by the Seller to the Purchaser on a servicing released basis. Subject
to, and upon the terms and conditions of this Agreement and the Interim
Servicing Agreement (with respect to each Mortgage Loan, for an interim period,
as specified therein), the Seller hereby sells, transfers, assigns, conveys and
delivers to the Purchaser the Servicing Rights.
The Purchaser shall retain the Interim Servicer as contract servicer
of the Mortgage Loans for an interim period pursuant to and in accordance with
the terms and conditions contained in the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Except as set forth in the Interim Servicing Agreement, the Interim Servicer
shall service the Mortgage Loans on an "actual/actual" basis and otherwise in
strict compliance with the servicing provisions related to the Xxxxxx Mae MBS
Program (Special Servicing Option) of the Xxxxxx Xxx Guides (except as otherwise
set forth in the Interim Servicing Agreement). The Purchaser and Seller shall
cause the Interim Servicer to execute the Interim Servicing Agreement on the
initial Closing Date.
Pursuant to the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Interim
Servicer shall begin servicing the Mortgage Loans on behalf of the Purchaser and
shall be entitled to a Servicing Fee with respect to such Mortgage Loans until
the applicable Transfer Date. The Interim Servicer shall conduct such servicing
in accordance with the Interim Servicing Agreement.
SECTION 8 Transfer of Servicing. On the applicable Transfer Date,
the Purchaser, or its designee, shall assume all servicing responsibilities
related to, and the Seller shall cause the Interim Servicer to cease all
servicing responsibilities related to, the related Mortgage Loans subject to
such Transfer Date. The Transfer Date shall be the date determined in accordance
with Section 6.02 of the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein).
On or prior to the applicable Transfer Date, the Seller shall, at
its sole cost and expense, take such steps as may be necessary or appropriate to
effectuate and evidence the transfer of the servicing of the related Mortgage
Loans to the Purchaser, or its designee, including but not limited to the
following:
(a) Notice to Mortgagors. The Seller shall cause the Interim
Servicer to mail to the Mortgagor of each related Mortgage Loan a letter
advising such Mortgagor of the transfer of the servicing of the related Mortgage
Loan to the Purchaser, or its designee, in accordance with the Xxxxxxxx Xxxxxxxx
National Affordable Housing Act of 1990; provided, however, the content and
format of the letter shall have the prior approval of the Purchaser. The Seller
shall cause the Interim Servicer to provide the Purchaser with copies of all
such related notices no later than the Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The Seller
shall cause the Interim Servicer to transmit to the applicable taxing
authorities and insurance companies (including primary mortgage insurance policy
insurers, if applicable) and/or agents, notification of the transfer of the
servicing to the Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may be, to the
Purchaser from and after the Transfer Date. The Seller shall cause the Interim
Servicer to provide the Purchaser with copies of all such notices no later than
the Transfer Date.
(c) Delivery of Servicing Records. The Seller shall cause the
Interim Servicer to forward to the Purchaser, or its designee, all servicing
records and the Servicing File in the Interim Servicer's possession relating to
each related Mortgage Loan including the information enumerated in the Interim
Servicing Agreement (with respect to each such Mortgage Loan, for an interim
period, as specified therein).
(d) Escrow Payments. The Seller shall cause the Interim Servicer to
provide the Purchaser, or its designee, with immediately available funds by wire
transfer in the amount of the net Escrow Payments and suspense balances and all
loss draft balances associated with the related Mortgage Loans. The Seller shall
cause the Interim Servicer to provide the Purchaser with an accounting
statement, in electronic format acceptable to the Purchaser in its sole
discretion, of Escrow Payments and suspense balances and loss draft balances
sufficient to enable the Purchaser to reconcile the amount of such payment with
the accounts of the Mortgage Loans. Additionally, the Seller shall cause the
Interim Servicer to wire transfer to the Purchaser the amount of any agency,
trustee or prepaid Mortgage Loan payments and all other similar amounts held by
the Interim Servicer.
(e) Payoffs and Assumptions. The Seller shall cause the Interim
Servicer to provide to the Purchaser, or its designee, copies of all assumption
and payoff statements generated by the Interim Servicer on the related Mortgage
Loans from the related Cut-off Date to the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Interim Servicer or the Seller on
each related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of
any related Monthly Payments received by the Seller after the Transfer Date
shall be forwarded to the Purchaser by overnight mail on the date of receipt.
The Seller shall notify the Purchaser of the particulars of the payment, which
notification requirement shall be satisfied if the Seller forwards with its
payment sufficient information to permit appropriate processing of the payment
by the Purchaser. The Seller shall assume full responsibility for the necessary
and appropriate legal application of such Monthly Payments received by the
Seller after the Transfer Date with respect to related Mortgage Loans then in
foreclosure or bankruptcy; provided, for purposes of this Agreement, necessary
and appropriate legal application of such Monthly Payments shall include, but
not be limited to, endorsement of a Monthly Payment to the Purchaser with the
particulars of the payment such as the account number, dollar amount, date
received and any special Mortgagor application instructions and the Seller shall
cause the Interim Servicer to comply with the foregoing requirements with
respect to all Monthly Payments received by the Interim Servicer after the
Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication errors;
(ii) The party receiving notice of a misapplied payment occurring
prior to the applicable Transfer Date and discovered after the Transfer
Date shall immediately notify the other party;
(iii) If a misapplied payment which occurred prior to the Transfer
Date cannot be identified and said misapplied payment has resulted in a
shortage in a Custodial Account or Escrow Account, the Seller shall be
liable for the amount of such shortage. The Seller shall reimburse the
Purchaser for the amount of such shortage within thirty (30) days after
receipt of written demand therefor from the Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer
Date has created an improper Purchase Price as the result of an inaccurate
outstanding principal balance, a check shall be issued to the party
shorted by the improper payment application within five (5) Business Days
after notice thereof by the other party; and
(v) Any check issued under the provisions of this Section 8(h) shall
be accompanied by a statement indicating the corresponding Seller and/or
the Purchaser Mortgage Loan identification number and an explanation of
the allocation of any such payments.
(i) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be in
accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on or before the Transfer
Date, reconcile principal balances and make any monetary adjustments required by
the Purchaser. Any such monetary adjustments will be transferred between the
Seller and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer
to file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be
filed on or before the Transfer Date in relation to the servicing and ownership
of the related Mortgage Loans. The Seller shall provide copies of such forms to
the Purchaser upon request and shall reimburse the Purchaser for any costs or
penalties incurred by the Purchaser due to the Seller's failure to comply with
this paragraph.
SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 9.01 Representations and Warranties Regarding the Seller.
The Seller represents, warrants and covenants to the Purchaser that as of the
date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the state of
California and has all licenses necessary to carry on its business as now being
conducted and is licensed, qualified and in good standing in each state wherein
it owns or leases any material properties or where a Mortgaged Property is
located, if the laws of such state require licensing or qualification in order
to conduct business of the type conducted by the Seller, and in any event the
Seller is in compliance with the laws of any such state to the extent necessary
to ensure the enforceability of the related Mortgage Loan and the servicing of
such Mortgage Loan in accordance with the terms of this Agreement and the
Interim Servicing Agreement; the Seller has the full corporate power, authority
and legal right to hold, transfer and convey the Mortgage Loans and to execute
and deliver this Agreement and to perform its obligations hereunder and
thereunder; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Seller and the consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized; this Agreement and all agreements
contemplated hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Seller, regardless of
whether such enforcement is sought in a proceeding in equity or at law; and all
requisite corporate or other action has been taken by the Seller to make this
Agreement and all agreements contemplated hereby valid and binding upon the
Seller in accordance with their terms;
(b) Ordinary Course of Business. The consummation of the
transactions contemplated by this Agreement are in the ordinary course of
business of the Seller, and the transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages by the Seller pursuant to this Agreement are
not subject to the bulk transfer or any similar statutory provisions in effect
in any applicable jurisdiction;
(c) No Conflicts. Neither the execution and delivery of this
Agreement, the acquisition or origination of the Mortgage Loans by the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation of the
transactions contemplated hereby and thereby, nor the fulfillment of or
compliance with the terms and conditions of this Agreement, will conflict with
or result in a breach of any of the terms, conditions or provisions of the
Seller's charter, by-laws or other organizational documents or any legal
restriction or any agreement or instrument to which the Seller is now a party or
by which it is bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Seller or its property is subject, or
result in the creation or imposition of any lien, charge or encumbrance that
would have an adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument, or impair the ability
of the Purchaser to realize on the Mortgage Loans, impair the value of the
Mortgage Loans, or impair the ability of the Purchaser to realize the full
amount of any insurance benefits accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer 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 OTS, the OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller, in its capacity as the
Interim Servicer, acknowledges and agrees that the Servicing Fee, represents
reasonable compensation for performing such services and that the entire
Servicing Fee shall be treated by the Interim Servicer, for accounting and tax
purposes, as compensation for the servicing and administration of the Mortgage
Loans pursuant to this Agreement and the Interim Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller does not believe, nor
does it have any reason or cause to believe, that it cannot perform each and
every covenant contained in this Agreement. The Seller is solvent and the sale
of the Mortgage Loans will not cause the Seller to become insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of Seller's creditors;
(g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or which, either in any one instance or in the
aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Seller contemplated herein, or which
would be likely to impair the ability of the Seller to perform under the terms
of this Agreement;
(h) No Consent Required. No consent, approval, authorization or
order of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is
required for the execution, delivery and performance by the Seller of or
compliance by the Seller with this Agreement or the Mortgage Loans, the delivery
of a portion of the Mortgage Files to the Custodian or the sale of the Mortgage
Loans or the consummation of the transactions contemplated by this Agreement, or
if required, such approval has been obtained prior to the related Closing Date;
(i) Selection Process. The Mortgage Loans were selected from among
the outstanding one- to four-family mortgage loans in the Seller's portfolio at
the related Closing Date as to which the representations and warranties set
forth in Subsection 9.02 could be made and such selection was not made in a
manner so as to affect adversely the interests of the Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of
the related Mortgage Loan Package are as set forth on the description of the
pool characteristics for the applicable Mortgage Loan Package delivered pursuant
to Section 11 on the related Closing Date in the form attached as Exhibit B to
each related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any
information, statement, tape, diskette, report, form, or other document
furnished or to be furnished pursuant to this Agreement or any Reconstitution
Agreement or in connection with the transactions contemplated hereby (including
any Securitization Transaction or Whole Loan Transfer) contains or will contain
any untrue statement of fact or omits or will omit to state a fact necessary to
make the statements contained herein or therein not misleading;
(l) Financial Statements. The Seller has delivered to the Purchaser
financial statements as to its last three complete fiscal years and any later
quarter ended more than 60 days prior to the execution of this Agreement. All
such financial statements fairly present the pertinent results of operations and
changes in financial position for each of such periods and the financial
position at the end of each such period of the Seller and its subsidiaries and
have been prepared in accordance with generally accepted accounting principles
of the United States consistently applied throughout the periods involved,
except as set forth in the notes thereto. In addition, the Seller has delivered
information as to its loan gain and loss experience in respect of foreclosures
and its loan delinquency experience for the immediately preceding three-year
period, in each case with respect to mortgage loans owned by it and mortgage
loans serviced for others during such period, and all such information so
delivered shall be true and correct in all material respects. There has been no
change in the business, operations, financial condition, properties or assets of
the Seller since the date of the Seller's financial statements that would have a
adverse effect on its ability to perform its obligations under this Agreement.
The Seller has completed any forms requested by the Purchaser in a timely manner
and in accordance with the provided instructions;
(m) No Brokers. The Seller has not dealt with any broker, investment
banker, agent or other person that may be entitled to any commission or
compensation in connection with the sale of the Mortgage Loans;
(n) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes;
(o) Reasonable Purchase Price. The consideration received by the
Seller upon the sale of the Mortgage Loans under this Agreement constitutes fair
consideration and reasonably equivalent value for the Mortgage Loans;
(p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note, and upon the sale
of the Mortgage Loans to the Purchaser, the Seller will retain the Mortgage
Files with respect thereto in trust only for the purpose of servicing and
supervising the servicing of each Mortgage Loan;
(q) Seller's Origination. The Seller's decision to originate any
mortgage loan or to deny any mortgage loan application is an independent
decision based upon Seller's underwriting guidelines, and is in no way made as a
result of Purchaser's decision to purchase, or not to purchase, or the price
Purchaser may offer to pay for, any such mortgage loan, if originated; and
(r) Compliance with Anti-Money Laundering Laws. The Seller has
complied with all applicable anti-money laundering laws, regulations and
executive orders, including without limitation the USA Patriot Act of 2001
(collectively, the "Anti-Money Laundering Laws"); the Seller has established an
anti-money laundering compliance program as required by the Anti-Money
Laundering Laws, has conducted the requisite due diligence in connection with
the origination of each Mortgage Loan for purposes of the Anti-Money Laundering
Laws, including with respect to the legitimacy of the applicable Mortgagor and
the origin of the assets used by the said Mortgagor to purchase the property in
question, and maintains, and will maintain, sufficient information to identify
the applicable Mortgagor for purposes of the Anti-Money Laundering Laws;
(s) Delivery to the Custodian. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to the Custodial Agreement shall be
delivered to the Custodian all in compliance with the specific requirements of
the Custodial Agreement. With respect to each Mortgage Loan, the Seller will be
in possession of a complete Mortgage File in compliance with Exhibit A hereto,
except for such documents as will be delivered to the Custodian; and
(a) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan, will fully furnish, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files to
Equifax, Experian and Trans Union Credit Information Company (three of the
credit repositories), on a monthly basis.
Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans. The Seller hereby represents and warrants to the Purchaser that,
as to each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the
Closing Date under the terms of the Mortgage Note have been made and credited.
As of the Closing Date, no payment required under the Mortgage Loan is thirty
(30) days or more delinquent nor has any payment under the Mortgage Loan been
thirty (30) days or more delinquent at any time since the origination of the
Mortgage Loan. The first Monthly Payment after the Cut-off Date shall be made
with respect to the Mortgage Loan on its Due Date or within the grace period,
all in accordance with the terms of the related Mortgage Note;
(c) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage securing the Mortgage Loan, 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 an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Except for (A) payments in the nature
of escrow payments and (B) interest accruing from the date of the Mortgage Note
or date of disbursement of the Mortgage Loan proceeds, whichever is earlier to
the day which precedes by one month the Due Date of the first installment of
principal and interest, including, without limitation, taxes and insurance
payments, the Seller has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination except by a written instrument which has been
recorded, if necessary to protect the interests of the Purchaser, and which has
been delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. No
Mortgagor has been released, in whole or in part, except in connection with an
assumption agreement, approved by the title insurer, to the extent required by
the policy, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) No Defenses. The Mortgage Loan is 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 either the
Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject to
any right of rescission, set-off, counterclaim or defense, including without
limitation the defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are provided for in the Xxxxxx Xxx Guides or by
Xxxxxxx Mac, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement attached hereto as Exhibit B. If required by the
National Flood Insurance Act of 1968, as amended, each Mortgage Loan is covered
by a flood insurance policy meeting the requirements of the current guidelines
of the Federal Insurance Administration in effect, which policy conforms to
Xxxxxx Xxx and Xxxxxxx Mac, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement attached hereto as Exhibit B.
All individual insurance policies contain a standard mortgagee clause naming the
Seller and its successors and assigns as mortgagee, and all premiums thereon
have been paid and such policies may not be reduced, terminated or cancelled
without thirty (30) days' prior written notice to the mortgagee. The Mortgage
obligates the Mortgagor thereunder to maintain the hazard insurance policy at
the Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
such Mortgagor's cost and expense, and to seek reimbursement therefor from the
Mortgagor. Where required by state law or regulation, the Mortgagor has been
given an opportunity to choose the carrier of the required hazard insurance,
provided the policy is not a "master" or "blanket" hazard insurance policy
covering a condominium, or any hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy is the
valid and binding obligation of the insurer, is in full force and effect, and
will be in full force and effect and inure to the benefit of the Purchaser upon
the consummation of the transactions contemplated by this Agreement. The Seller
has not engaged in, and has no knowledge of the Mortgagor's or any servicer's
having engaged in, any act or omission which would impair the coverage of any
such policy, the benefits of the endorsement provided for herein, or the
validity and binding effect of such policy, including, without limitation, no
unlawful fee, commission, kickback or other unlawful compensation or value of
any kind has been or will be received, retained or realized by any attorney,
firm or other person or entity, and no such unlawful items have been received,
retained or realized by the Seller;
(g) Compliance with Applicable Laws. 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,
predatory and abusive lending, equal credit opportunity and disclosure laws
applicable to the Mortgage Loan, including, without limitation, any provisions
relating to prepayment penalties, have been complied with, the consummation of
the transactions contemplated hereby will not involve the violation of any such
laws or regulations, and the Seller shall maintain in its possession, available
for the Purchaser's inspection, and shall deliver to the Purchaser upon demand,
evidence of compliance with all such requirements. This representation is a
Deemed Material Breach Representation;
(h) No Satisfaction of Mortgage. The Mortgage has not been
satisfied, canceled, subordinated or rescinded, in whole or in part, and the
Mortgaged Property has not been released from the lien of the Mortgage, in whole
or in part, nor has any instrument been executed that would effect any such
release, cancellation, subordination or rescission. The Seller 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
Seller waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property
is a fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a low-rise condominium project, or an individual
unit in a planned unit development and that no residence or dwelling is a mobile
home, provided, however, that any condominium unit or planned unit development
shall not fall within any of the "Ineligible Projects" of part XII, Section 102
of the Xxxxxx Mae Selling Guide and shall conform with the Underwriting
Guidelines. In the case of any Mortgaged Properties that are manufactured homes
(a "Manufactured Home Mortgage Loans"), (A) (i) such Manufactured Home Mortgage
Loan conforms with the applicable Xxxxxx Xxx or Xxxxxxx Mac requirements
regarding mortgage loans related to manufactured dwellings, (ii) the related
manufactured dwelling is permanently affixed to the land, (iii) the related
manufactured dwelling and the related land are subject to a Mortgage properly
filed in the appropriate public recording office and naming Seller as mortgagee,
(iv) the applicable laws of the jurisdiction in which the related Mortgaged
Property is located will deem the manufactured dwelling located on such
Mortgaged Property to be a part of the real property on which such dwelling is
located, (v) such Manufactured Home Mortgage Loan is (x) a qualified mortgage
under Section 860G(a)(3) of the Internal Revenue Code of 1986, as amended and
(y) secured by manufactured housing treated as a single family residence under
Section 25(e)(10) of the Code (i.e., such manufactured home has a minimum of 400
square feet of living space, a minimum width in excess of 102 inches and which
is of a kind customarily used at a fixed location) and (vi) as of the
origination date of the related Mortgage Loan, the related Mortgagor occupied
the related manufactured home as its primary residence. As of the date of
origination, no portion of the Mortgaged Property was used for commercial
purposes, and since the date of origination, no portion of the Mortgaged
Property has been used for commercial purposes; provided, that Mortgaged
Properties which contain a home office shall not be considered as being used for
commercial purposes as long as the Mortgaged Property has not been altered for
commercial purposes and is not storing any chemicals or raw materials other than
those commonly used for homeowner repair, maintenance and/or household purposes.
This representation is a Deemed Material Breach Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements on
the Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to such
buildings, and all additions, alterations and replacements made at any time,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. In no event shall any Mortgage Loan be
in a lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of
recording acceptable to prudent mortgage lending institutions generally
and specifically referred to in the lender's title insurance policy
delivered to the originator of the Mortgage Loan and (a) specifically
referred to or otherwise considered in the appraisal made for the
originator of the Mortgage Loan or (b) which do not adversely affect the
Appraised Value of the Mortgaged Property set forth in such appraisal; and
(4) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of the
security intended to be provided by the Mortgage or the use, enjoyment,
value or marketability of the related Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Seller has full right to sell and
assign the same to Purchaser. The Mortgaged Property was not, as of the date of
origination of the Mortgage Loan, subject to a mortgage, deed of trust, deed to
secure debt or other security instrument creating a lien subordinate to the lien
of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage and any other agreement executed and delivered by a Mortgagor or
guarantor, if applicable, in connection with a Mortgage Loan are genuine, and
each is the legal, valid and binding obligation of the maker thereof enforceable
in accordance with its terms (including, without limitation, any provisions
therein relating to prepayment penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage and
any other related agreement, and the Mortgage Note, the Mortgage and any other
such related agreement have been duly and properly executed by other such
related parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material fact
or omit to state a material fact required to be stated therein or necessary to
make the information and statements therein not misleading. No fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination or servicing of the Mortgage Loan. The Seller
has reviewed all of the documents constituting the Servicing File and has made
such inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed
and 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 improvement and as to disbursements of any
escrow funds therefor have been complied with. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage were paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due under the Mortgage Note or Mortgage;
(m) Ownership. The Seller is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon
the sale of the Mortgage Loans to the Purchaser, the Seller will retain the
Mortgage Files or any part thereof with respect thereto not delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan. The
Mortgage Loan is not assigned or pledged, and the Seller has good, indefeasible
and marketable title thereto, and has full right to transfer and sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest, and
has full right and authority subject to no interest or participation of, or
agreement with, any other party, to sell and assign each Mortgage Loan pursuant
to this Agreement and following the sale of each 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
Seller intends to relinquish all rights to possess, control and monitor the
Mortgage Loan. After the Closing Date, the Seller will have no right to modify
or alter the terms of the sale of the Mortgage Loan and the Seller will have no
obligation or right to repurchase the Mortgage Loan or substitute another
Mortgage Loan, except as provided in this Agreement;
(n) Doing Business. All parties which have had any interest in the
Mortgage Loan, whether as mortgagee, assignee, pledgee or otherwise, are (or,
during the period in which they held and disposed of such interest, were) (1) in
compliance with any and all applicable licensing requirements of the laws of the
state wherein the Mortgaged Property is located, and (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state, or
(iii) a federal savings and loan association, a savings bank or a national bank
having a principal office in such state, or (3) not doing business in such
state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien
Loan has a CLTV in excess of 100%. No Mortgage Loan has an LTV greater than
100%. At origination of the Mortgage Loan, the Mortgagor did not have a FICO
score of less than 500;
(p) Title Insurance. The 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 Xxxxxxx Mac and each such title insurance
policy is issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and
qualified to do business in the jurisdiction where the Mortgaged Property is
located, insuring the Seller, its successors and assigns, as to the first
priority lien (with respect to First Lien Loans) or second priority lien (with
respect to Second Lien Loans) of the Mortgage in the original principal amount
of the Mortgage Loan, subject only to the exceptions contained in clauses (1)
and (2) of paragraph (j) of this Subsection 9.02, and in the case of Adjustable
Rate Mortgage Loans, against any loss by reason of the invalidity or
unenforceability of the lien resulting from the provisions of the Mortgage
providing for adjustment to 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.
Additionally, such lender's title insurance policy affirmatively insures ingress
and egress, and against encroachments by or upon the Mortgaged Property or any
interest therein. The title policy does not contain any special exceptions
(other than the standard exclusions) for zoning and uses and has been marked to
delete the standard survey exception or to replace the standard survey exception
with a specific survey reading. The Seller, its successor and assigns, are the
sole insureds of such lender's title insurance policy, and such lender's title
insurance policy is valid and remains in full force and effect and will be in
force and effect upon the consummation of the transactions contemplated by this
Agreement. No claims have been made under such lender's title insurance policy,
and no prior holder of the related Mortgage, including the Seller, has done, by
act or omission, anything which would impair the coverage of such lender's title
insurance policy, including without limitation, no unlawful fee, commission,
kickback or other unlawful compensation or value of any kind has been or will be
received, retained or realized by any attorney, firm or other person or entity,
and no such unlawful items have been received, retained or realized by the
Seller;
(q) No Defaults. There is no default, breach, violation or event
which would permit acceleration existing under the Mortgage or the Mortgage Note
and no event which, with the passage of time or with notice and the expiration
of any grace or cure period, would constitute a default, breach, violation or
event which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note, (iii) there is no event which, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the Second Lien Loan to
receive notice of, and affords such mortgagee an opportunity to cure any default
by payment in full or otherwise under the prior mortgage;
(r) No Mechanics' Liens. 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 the law could give rise to such liens) affecting the
related Mortgaged Property which are or may be liens prior to, or equal or
coordinate with, the lien of the related Mortgage;
(s) Location of Improvements; No Encroachments. All improvements
which were considered in determining the Appraised Value of the Mortgaged
Property lay wholly within the boundaries and building restriction lines of the
Mortgaged Property, and no improvements on adjoining properties encroach upon
the Mortgaged Property. The Mortgaged Property and all improvements located on
or being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
(t) Origination; Payment Terms. 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 Act, a savings and loan association, a savings
bank, a commercial bank, credit union, insurance company or other similar
institution which is supervised and examined by a federal or state authority.
The documents, instruments and agreements submitted for loan underwriting were
not falsified and contain no untrue statement of material fact or omit to state
a material fact required to be stated therein or necessary to make the
information and statements therein not misleading. No Mortgage Loan contains
terms or provisions which would result in negative amortization. Principal
payments on the Mortgage Loan commenced no more than sixty days after funds were
disbursed in connection with the Mortgage Loan. The Mortgage Interest Rate as
well as, with respect to Adjustable Rate Mortgage Loans, the Lifetime Rate Cap,
the Periodic Rate Floor and the Periodic Rate Cap are as set forth on Exhibit B
to each related Assignment and Conveyance Agreement. The Mortgage Interest Rate
is adjusted, with respect to Adjustable Rate Mortgage Loans, on each Interest
Rate Adjustment Date to equal the Index plus the Gross Margin (rounded up or
down to the nearest 0.125%), subject to the Periodic Rate Cap. The Mortgage Note
is payable in equal monthly installments of principal and interest, which
installments of interest, with respect to Adjustable Rate Mortgage Loans, are
subject to change due to the adjustments to the Mortgage Interest Rate on each
Interest Rate Adjustment Date, with interest calculated and payable in arrears,
sufficient to amortize the Mortgage Loan fully by the stated maturity date
(unless the Mortgage Loan is identified on the Mortgage Loan Schedule as a
Balloon Mortgage Loan), over an original term of not more than thirty years from
commencement of amortization. Unless otherwise specified on the description of
pool characteristics for the applicable Mortgage Loan Package delivered pursuant
to Section 11 on the related Closing Date in the form attached as Exhibit B to
each related Assignment and Conveyance Agreement, the Mortgage Loan is payable
on the first day of each month. There are no Convertible Mortgage Loans which
contain a provision allowing the Mortgagor to convert the Mortgage Note from an
adjustable interest rate Mortgage Note to a fixed interest rate Mortgage Note.
The Due Date of the first payment under the Mortgage Note is no more than 60
days from the date of the Mortgage Note;
(u) Customary Provisions. The 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, (i) in the case of a
Mortgage designated as a deed of trust, by trustee's sale, and (ii) otherwise by
judicial foreclosure. Upon default by a Mortgagor on a Mortgage Loan and
foreclosure on, or trustee's sale of, the Mortgaged Property pursuant to the
proper procedures, the holder of the Mortgage Loan will be able to deliver good
and merchantable title to the Mortgaged Property. There is no homestead or other
exemption available to a Mortgagor which would interfere with the right to sell
the Mortgaged Property at a trustee's sale or the right to foreclose the
Mortgage, subject to applicable federal and state laws and judicial precedent
with respect to bankruptcy and right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The
Mortgage Loan was underwritten in accordance with the Underwriting Guidelines (a
copy of which is attached to the related Assignment and Conveyance Agreement as
Exhibit C). The Mortgage Note and Mortgage are on forms acceptable to Xxxxxxx
Mac or Xxxxxx Mae and no representations have been made to a Mortgagor that are
inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date the
Mortgaged Property is lawfully occupied under applicable law. All inspections,
licenses and certificates required to be made or issued with respect to all
occupied portions of the Mortgaged Property and, with respect to the use and
occupancy of the same, including but not limited to certificates of occupancy
and fire underwriting certificates, have been made or obtained from the
appropriate authorities. The Seller has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Seller has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. The Mortgagor represented at the time of origination of the
Mortgage Loan that the Mortgagor would occupy the Mortgaged Property as the
Mortgagor's primary residence;
(x) No Additional Collateral. The 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 in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. There are no circumstances or conditions
with respect to the Mortgage, the Mortgaged Property, the Mortgagor, the
Mortgage File or the Mortgagor's credit standing that can reasonably be expected
to cause private institutional investors to regard the Mortgage Loan as an
unacceptable investment, cause the Mortgage Loan to become delinquent, or
adversely affect the value or marketability of the Mortgage Loan, or cause the
Mortgage Loan to prepay during any period materially faster or slower than the
mortgage loans originated by the Seller generally. No Mortgaged Property is
located in a state, city, county or other local jurisdiction which the Purchaser
has determined in its sole good faith discretion would cause the related
Mortgage Loan to be ineligible for whole loan sale or securitization in a
transaction consistent with the prevailing sale and securitization industry
(including, without limitation, the practice of the rating agencies) with
respect to substantially similar mortgage loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the
Mortgage, the Assignment of Mortgage and any other documents required to be
delivered under this Agreement for each Mortgage Loan have been delivered to the
Custodian. The Seller is in possession of a complete, true and accurate Mortgage
File in compliance with Exhibit A hereto, except for such documents the
originals of which have been delivered to the Custodian, and the Seller has
retained copies thereof;
(bb) Condominiums/Planned Unit Developments. If the Mortgaged
Property is a condominium unit or a planned unit development (other than a de
minimis planned unit development) such condominium or planned unit development
project is underwritten in accordance with the Underwriting Guidelines;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Seller are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Seller has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to
the Mortgagor prior to the applicable Cut-off Date have been consolidated with
the outstanding principal amount secured by the Mortgage, and the secured
principal amount, as consolidated, bears a single interest rate and single
repayment term. The lien of the Mortgage securing the consolidated principal
amount is expressly insured as having first or second, as applicable, lien
priority by a title insurance policy, an endorsement to the policy insuring the
mortgagee's consolidated interest or by other title evidence acceptable to
Xxxxxx Xxx and Xxxxxxx Mac. The consolidated principal amount does not exceed
the original principal amount of the Mortgage Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings.
There is no proceeding pending or threatened for the total or partial
condemnation of the Mortgaged Property. The Mortgaged Property is undamaged by
waste, fire, earthquake or earth movement, windstorm, flood, tornado or other
casualty so as to affect adversely the value of the Mortgaged Property as
security for the Mortgage Loan or the use for which the premises were intended
and each Mortgaged Property is in good repair. There have not been any
condemnation proceedings with respect to the Mortgaged Property and the Seller
has no knowledge of any such proceedings in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate
Adjustments. The origination, servicing and collection practices with respect to
the Mortgage Loan have been in all respects in compliance with Accepted
Servicing Practices, applicable laws and regulations, and have been in all
respects legal and proper. With respect to escrow deposits and Escrow Payments
(other than with respect to Second Lien Loans for which the mortgagee under the
prior mortgage lien is collecting Escrow Payments), all such payments are in the
possession of Seller and there exist no deficiencies in connection therewith for
which customary arrangements for repayment thereof have not been made. Each
Mortgage Loan is covered by a paid in full, life of loan, tax service contract
that has been assigned without penalty, premium or cost to the Purchaser. All
Escrow Payments have been collected in full compliance with state and federal
law and the provisions of the related Mortgage Note and Mortgage. An escrow of
funds is not prohibited by applicable law and has been established in an amount
sufficient to pay for every item that remains unpaid and has been assessed but
is not yet due and payable. No escrow deposits or Escrow Payments or other
charges or payments due the Seller have been capitalized under the Mortgage or
the Mortgage Note. All Mortgage Interest Rate adjustments have been made in
strict compliance with state and federal law and the terms of the related
Mortgage and Mortgage Note on the related Interest Rate Adjustment Date. If,
pursuant to the terms of the Mortgage Note, another index was selected for
determining the Mortgage Interest Rate, the same index was used with respect to
each Mortgage Note which required a new index to be selected, and such selection
did not conflict with the terms of the related Mortgage Note. Any and all
notices required under applicable law and the terms of the related Mortgage Note
and Mortgage regarding the Mortgage Interest Rate and the Monthly Payment
adjustments have been delivered. Any interest required to be paid pursuant to
state, federal and local law has been properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan has the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has existed on or
prior to the Closing Date that has resulted or will result in the exclusion
from, denial of, or defense to coverage under any applicable primary mortgage
insurance policy, hazard insurance policy or bankruptcy bond (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), irrespective of the cause of such failure of
coverage. The Seller has caused or will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser. In connection with the placement of any such
insurance, no commission, fee, or other compensation has been or will be
received by the Seller or by any officer, director, or employee of the Seller or
any designee of the Seller or any corporation in which the Seller or any
officer, director, or employee had a financial interest at the time of placement
of such insurance;
(ll) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not
notified the Seller, and the Seller has no knowledge of any relief requested or
allowed to the Mortgagor under the Servicemembers' Civil Relief Act of 1940, as
amended, or any similar state statute;
(nn) Appraisal. The Seller has delivered to the Purchaser an
appraisal of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser qualified under Xxxxxx Xxx and Xxxxxxx Mac
guidelines who (i) is licensed in the state where the Mortgaged Property is
located, (ii) has no interest, direct or indirect, in the Mortgaged Property or
in any Loan or the security therefor, and (iii) does not receive compensation
that is affected by the approval or disapproval of the Mortgage Loan. The
appraisal shall have been made within one hundred and eighty (180) days of the
origination of the Mortgage Loan and shall be completed in compliance with the
Uniform Standards of Professional Appraisal Practice, and all applicable Federal
and state laws and regulations. If the appraisal was made more than one hundred
and twenty (120) days before the origination of the Mortgage Loan, the Seller
shall have received and delivered to the Purchaser a recertification of the
appraisal;
(oo) Disclosure Materials. The Mortgagor has, to the extent required
by applicable law, executed a statement to the effect that the Mortgagor has,
received all disclosure materials required by applicable law and the Seller has
complied with all applicable law with respect to the making of the Mortgage
Loans. The Seller shall cause the Interim Servicer to maintain such statement in
the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. The
Mortgage Loan was not made in connection with the construction or rehabilitation
of a Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) No Defense to Insurance Coverage. No action has been taken or
failed to be taken, no event has occurred and no state of facts exists or has
existed on or prior to the Closing Date (whether or not known to the Seller on
or prior to such date) which has resulted or will result in an exclusion from,
denial of, or defense to coverage under any primary mortgage insurance
(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 Seller, the
related Mortgagor or any party involved in the application for such coverage,
including the appraisal, plans and specifications and other exhibits or
documents submitted therewith to the insurer under such insurance policy, or for
any other reason under such coverage, but not including the failure of such
insurer to pay by reason of such insurer's breach of such insurance policy or
such insurer's financial inability to pay. In connection with the placement of
any such insurance, no commission, fee, or other compensation has been or will
be received by the Seller or any designee of the Seller or any corporation in
which the Seller or any officer, director, or employee had a financial interest
at the time of placement of such insurance;
(rr) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(ss) Credit Information. As to each consumer report (as defined in
the Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Seller to the Purchaser, that Seller has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Seller shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Seller has in its capacity as servicer, for each Mortgage Loan,
fully furnished, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g., favorable and
unfavorable) on its borrower credit files to Equifax, Experian and Trans Union
Credit Information Company (three of the credit repositories), on a monthly
basis. This representation is a Deemed Material Breach Representation;
(tt) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate, the assignment of the lease without the lessor's consent and
the acquisition by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder of the
Mortgage with substantially similar protections; (3) the terms of such lease do
not (a) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than 15 years; (5) the term of such lease does not terminate earlier than
five years after the maturity date of the Mortgage Note; and (6) the Mortgaged
Property is located in a jurisdiction in which the use of leasehold estates in
transferring ownership in residential properties is a widely accepted practice;
(uu) Prepayment Penalty. The Mortgage Loan is subject to a
prepayment penalty as provided in the related Mortgage Note except as set forth
on Exhibit B to each related Assignment and Conveyance Agreement. With respect
to each Mortgage Loan that has a prepayment penalty feature, each such
prepayment penalty is enforceable and will be enforced by the Seller for the
benefit of the Purchaser, and each prepayment penalty is permitted pursuant to
federal, state and local law. Each such prepayment penalty is in an amount equal
to the maximum amount permitted under applicable law and no such prepayment
penalty may be imposed for a term in excess of five (5) years with respect to
Mortgage Loans originated prior to October, 1, 2002. With respect to Mortgage
Loans originated on or after October 1, 2002, , the duration of the prepayment
period shall not exceed three (3) years from the date of the Mortgage Note
unless the Mortgage Loan was modified to reduce the prepayment period to no more
than three (3) years from the date of such Mortgage Note and the Mortgagor was
notified in writing of such reduction in prepayment period. 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 Mortgage Loan's origination,
the Mortgagor agreed to such premium in exchange for a monetary benefit,
including but not limited to a rate or fee reduction, (ii) prior to the Mortgage
Loan's origination, the Mortgagor was offered the option of obtaining a mortgage
loan that did not require payment of such a premium and (iii) the prepayment
premium is disclosed to the Mortgagor in the loan documents pursuant to
applicable state, local and federal law. This representation is a Deemed
Material Breach Representation;
(vv) Assumability. With respect to each Adjustable Rate Mortgage
Loan, the Mortgage Loan Documents provide that after the related first Interest
Rate Adjustment Date, a related Mortgage Loan may only be assumed if the party
assuming such Mortgage Loan meets certain credit requirements stated in the
Mortgage Loan Documents;
(ww) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(xx) Escrow Analysis. With respect to each Mortgage, the Seller has
within the last twelve (12) months (unless such Mortgage was originated within
such twelve month period) analyzed the required Escrow Payments for each
Mortgage and adjusted the amount of such payments so that, assuming all required
payments are timely made, any deficiency will be eliminated on or before the
first anniversary of such analysis, or any overage will be refunded to the
Mortgagor, in accordance with RESPA and any other applicable law;
(yy) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion. This representation is a Deemed Material Breach
Representation;
(zz) Single-Premium Credit Life Insurance Policy. No Mortgagor was
required to purchase any single premium credit insurance policy (e.g., life,
mortgage, disability, property, accident, unemployment or health insurance
product) or debt cancellation agreement as a condition of obtaining the
extension of credit. No Mortgagor obtained a prepaid single-premium credit
insurance policy (e.g., life, mortgage, disability, property, accident,
unemployment, mortgage or health insurance) in connection with the origination
of the Mortgage Loan. No proceeds from any Mortgage Loan were used to purchase
single premium credit insurance policies or debt cancellation agreements as part
of the origination of, or as a condition to closing, such Mortgage Loan. This
representation is a Deemed Material Breach Representation;
(aaa) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or trustees for an Illinois land trust or a trustee under a "living
trust" and such "living trust" is in compliance with Xxxxxx Mae guidelines for
such trusts;
(bbb) Insurance. The Seller has caused or will cause to be performed
any and all acts required to preserve the rights and remedies of the Purchaser
in any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser;
(ccc) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(ddd) Flood Certification Contract. The Mortgage Loan is covered by
a paid in full, life of loan, transferable flood certification contract that has
been assigned without penalty, cost or premium to the Purchaser;
(eee) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(fff) Origination Date. The date of origination of the Mortgage Loan
shall be no earlier than three (3) months prior to the date such Mortgage Loan
is first purchased by the Purchaser;
(ggg) No Exception. The Custodian has not noted any material
exceptions on an Exception Report (as defined in the Custodial Agreement) with
respect to the Mortgage Loan which would materially adversely affect the
Mortgage Loan or the Purchaser's ownership of the Mortgage Loan, unless
consented to by the Purchaser;
(hhh) Mortgage Submitted for Recordation. The Mortgage either has
been or will promptly be submitted for recordation in the appropriate
governmental recording office of the jurisdiction where the Mortgaged Property
is located;
(iii) Endorsements. The Mortgage Note has been endorsed by Seller
for its own account and not as a fiduciary, trustee, trustor or beneficiary
under a trust agreement;
(jjj) Accuracy of Information. All information provided to the
Purchaser by the Seller with respect to the Mortgage Loan is accurate in all
material respects;
(kkk) Mortgagor Bankruptcy. On or prior to the date sixty (60) days
after the related Closing Date, the Mortgagor has not filed or will not file a
bankruptcy petition or has not become the subject or will not become the subject
of involuntary bankruptcy proceedings or has not consented to or will not
consent to the filing of a bankruptcy proceeding against it or to a receiver
being appointed in respect of the related Mortgaged Property;
(lll) No Construction Loans. No Mortgage Loan was made in connection
with (a) facilitating the trade-in or exchange of a Mortgaged Property or (b)
the construction or rehabilitation of a Mortgaged Property, unless the Mortgage
Loan is a construction-to-permanent mortgage loan listed on the Mortgage Loan
Schedule which has been fully disbursed, all construction work is complete and a
completion certificate has been issued;
(mmm) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Seller has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor;
(nnn) Proceeds of Mortgage Loan. The proceeds of the Mortgage Loan
have not been and shall not be used to satisfy, in whole or in part, any debt
owed or owing by the Mortgagor to Seller or any Affiliate or correspondent
thereof unless such debt was originated more than 24 months prior to the
origination of such Mortgage Loan;
(ooo) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction. This representation is a Deemed Material Breach Representation;
(ppp) Origination Practices/No Steering. No Mortgagor was encouraged
or required to select a Mortgage Loan product offered by the Mortgage Loan's
originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account credit history and debt-to-income ratios for
a lower-cost credit product then offered by the Mortgage Loan's originator or
any affiliate of the Mortgage Loan's originator. If, at the time of loan
application, the Mortgagor 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 Mortgagor's application
to such affiliate for underwriting consideration. This representation is a
Deemed Material Breach Representation;
(qqq) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan employs, in part, objective
mathematical principles which relate the Mortgagor's income, assets and
liabilities to the proposed payment and such underwriting methodology does not
rely on the extent of the Mortgagor'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
Mortgagor had a reasonable ability to make timely payments on the Mortgage Loan.
This representation is a Deemed Material Breach Representation;
(rrr) Points and Fees. No Mortgagor was charged "points and fees"
(whether or not financed) in an amount greater than (i) $1,000 or (ii) 5% of the
principal amount of such Mortgage Loan, whichever is greater. For purposes of
this representation, "points and fees" (x) include origination, underwriting,
broker and finder fees and charges paid to the mortgage or a third party, and
(y) exclude bona fide discount points, fees paid for actual services rendered in
connection with the origination of the Mortgage Loan (such attorneys' fees,
notaries fees and fees paid for property appraisals, credit reports, surveys,
title examinations and extracts, flood and tax certifications and home
inspections), the costs of mortgage insurance or credit-risk price adjustments,
the costs of title, hazard and flood insurance policies, state and local
transfer taxes or fees, escrow deposits for the future payment of taxes and
insurance premiums, and other miscellaneous fees and charges that, in total, do
not exceed 0.25% of the principal amount of such Mortgage Loan. This
representation is a Deemed Material Breach Representation;
(sss) Fees Charges. All fees and charges (including finance charges)
and whether or not financed, assessed, collected or to be collected in
connection with the origination and servicing of each Mortgage Loan has been
disclosed in writing to the Mortgagor in accordance with applicable state and
federal law and regulation. This representation is a Deemed Material Breach
Representation; and
(ttt) Second Lien Mortgage Loans. With respect to each Second Lien
Loan: (1) the related First Lien Loan does not permit negative amortization; (2)
where required or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) to the best of Seller's
knowledge, the related First Lien Loan is in full force and effect, and there is
no default, lien, breach, violation or event which would permit acceleration
existing under such First Lien Loan or 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 which would
permit acceleration under such First Lien Loan; (4) the related first lien
Mortgage contains a provision which provide for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such mortgagee to
cure any default under the related first lien Mortgage; and (5) the related
Mortgaged Property was the Mortgagor's principal residence at the time of the
origination of the such Second Lien Loan. This representation is a Deemed
Material Breach Representation.
Subsection 9.03 Remedies for Breach of Representations and
Warranties. It is understood and agreed that the representations and warranties
set forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage
Loans to the Purchaser and shall inure to the benefit of the Purchaser,
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
Assignment of Mortgage or the examination or failure to examine any Mortgage
File. Upon discovery by either the Seller or the Purchaser of a breach of any of
the foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other.
Within 60 days of the earlier of either discovery by or notice to
the Seller of any breach of a representation or warranty which materially and
adversely affects the value of the Mortgage Loans or the interest of the
Purchaser therein (or which materially and adversely affects the value of the
applicable Mortgage Loan or the interest of the Purchaser therein in the case of
a representation and warranty relating to a particular Mortgage Loan), the
Seller shall use its best efforts promptly to cure such breach in all material
respects and, if such breach cannot be cured, the Seller shall, at the
Purchaser's option, repurchase such Mortgage Loan at the Repurchase Price,
together with all expenses incurred by the Purchaser as a result of such
repurchase. Notwithstanding the above sentence, (i) within sixty (60) days of
the earlier of either discovery by, or notice to, the Seller of any breach of
the representation and warranty set forth in clause (rr) of Subsection 9.02, the
Seller shall repurchase such Mortgage Loan at the Repurchase Price, together
with all expenses incurred by the Purchaser as a result of such repurchase and
(ii) any breach of a Deemed Material Breach Representation shall automatically
be deemed to materially and adversely affect the value of the Mortgage Loan and
the interest of the Purchaser therein. In the event that a breach shall involve
any representation or warranty set forth in Subsection 9.01, and (except as
provided in the preceding sentence with respect to certain breaches for which no
cure is permitted) such breach cannot be cured within sixty (60) days of the
earlier of either discovery by or notice to the Seller of such breach, all of
the Mortgage Loans shall, at the Purchaser's option, be repurchased by the
Seller at the Repurchase Price, together with all expenses incurred by the
Purchaser as a result of such repurchase. However, if the breach shall involve a
representation or warranty set forth in Subsection 9.02 (other than the
representations and warranties set forth in clause (rr) of such Subsection or
any Deemed Material Breach Representation) and the Seller discovers or receives
notice of any such breach within one hundred twenty (120) days of the related
Closing Date, the Seller shall, at the Purchaser's option and provided that the
Seller has a Qualified Substitute Mortgage Loan, rather than repurchase the
Mortgage Loan as provided above, remove such Mortgage Loan (a "Deleted Mortgage
Loan") and substitute in its place a Qualified Substitute Mortgage Loan or
Loans, provided that any such substitution shall be effected not later than one
hundred twenty (120) days after the related Closing Date. If the Seller has no
Qualified Substitute Mortgage Loan, it shall repurchase the deficient Mortgage
Loan. Any repurchase of a Mortgage Loan or Loans pursuant to the foregoing
provisions of this Subsection 9.03 shall be accomplished by either (a) if the
Interim Servicing Agreement has been entered into and is in effect, deposit in
the Custodial Account of the amount of the Repurchase Price for distribution to
the Purchaser on the next scheduled Remittance Date, after deducting therefrom
any amount received in respect of such repurchased Mortgage Loan or Loans and
being held in the Custodial Account for future distribution or (b) if the
Interim Servicing Agreement has not been entered into or is no longer in effect,
by direct remittance of the Repurchase Price to the Purchaser or its designee in
accordance with the Purchaser's instructions.
At the time of repurchase or substitution, the Purchaser and the
Seller shall arrange for the reassignment of the Deleted Mortgage Loan to the
Seller and the delivery to the Seller of any documents held by the Custodian
relating to the Deleted Mortgage Loan. In the event of a repurchase or
substitution, the Seller shall, simultaneously with such reassignment, give
written notice to the Purchaser that such repurchase or substitution has taken
place, amend the Mortgage Loan Schedule to reflect the withdrawal of the Deleted
Mortgage Loan from this Agreement, and, in the case of substitution, identify a
Qualified Substitute Mortgage Loan and amend the Mortgage Loan Schedule to
reflect the addition of such Qualified Substitute Mortgage Loan to this
Agreement. In connection with any such substitution, the Seller shall be deemed
to have made as to such Qualified Substitute Mortgage Loan the representations
and warranties set forth in this Agreement except that all such representations
and warranties set forth in this Agreement shall be deemed made as of the date
of such substitution. The Seller shall effect such substitution by delivering to
the Custodian or to such other party as the Purchaser may designate in writing
for such Qualified Substitute Mortgage Loan the documents required by Subsection
6.03, with the Mortgage Note endorsed as required by Subsection 6.03. No
substitution will be made in any calendar month after the Determination Date for
such month. The Seller shall cause the Interim Servicer to remit directly to the
Purchaser, or its designee in accordance with the Purchaser's instructions the
Monthly Payment less the Servicing Fee due, if any, on such Qualified Substitute
Mortgage Loan or Loans in the month following the date of such substitution.
Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the
month of substitution shall be retained by the Seller. For the month of
substitution, distributions to the Purchaser shall include the Monthly Payment
due on any Deleted Mortgage Loan in the month of substitution, and the Seller
shall thereafter be entitled to retain all amounts subsequently received by the
Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the
Seller shall indemnify the Purchaser and its present and former directors,
officers, employees and agents and any Successor Servicer and its present and
former directors, officers, employees and agents and hold such parties harmless
against any losses, damages, penalties, fines, forfeitures, legal fees and
expenses and related costs, judgments, and other costs and expenses resulting
from any claim, demand, defense or assertion based on or grounded upon, or
resulting from, a breach of any representation or warranty contained in this
Agreement or any Reconstitution Agreement. It is understood and agreed that the
obligations of the Seller set forth in this Subsection 9.03 to cure, substitute
for or repurchase a defective Mortgage Loan and to indemnify the Purchaser and
Successor Servicer as provided in this Subsection 9.03 and Subsection 14.01
constitute the sole remedies of the Purchaser and Successor Servicer respecting
a breach of the foregoing representations and warranties. For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
Any cause of action against the Seller relating to or arising out of
the breach of any representations and warranties made in Subsections 9.01 and
9.02 shall accrue as to any Mortgage Loan upon (i) discovery of such breach by
the Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by
the Seller to cure such breach or repurchase such Mortgage Loan as specified
above, and (iii) demand upon the Seller by the Purchaser for compliance with
this Agreement.
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full. If
any Mortgage Loan is prepaid within one hundred and eighty (180) days from and
after the related Closing Date, the Seller shall pay to the Purchaser, within
three (3) business days of such prepayment in full, an amount equal to the
Premium Percentage multiplied by the outstanding principal balance of such
Mortgage Loan as of the date of such prepayment in full.
Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults.
(a) If the related Mortgagor is delinquent with respect to the
Mortgage Loan's first Monthly Payment after origination of such Mortgage Loan,
the Seller, at the Purchaser's option exercised in its sole discretion, shall
repurchase such Mortgage Loan from the Purchaser at a price equal to the
percentage of par as stated in the related Purchase Price and Terms Agreement
(subject to adjustment as provided therein) multiplied by the then outstanding
principal balance of such Mortgage Loan, plus accrued and unpaid interest
thereon from the date to which interest was last paid through the day prior to
the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan.
(b) If the related Mortgagor is delinquent with respect to the
Mortgage Loan's Monthly Payment due in the month in which the related Closing
Date occurs or the Monthly Payment due in the first two calendar months
following the month in which the related Closing Date occurs, in each case on
its due date or within the grace period, all in accordance with the terms of the
related Mortgage Note, the Seller, at the Purchaser's option exercised in its
sole discretion, shall repurchase such Mortgage Loan from the Purchaser at a
price equal to the percentage of par as stated in the related Purchase Price and
Terms Agreement (subject to adjustment as provided therein) multiplied by the
then outstanding principal balance of such Mortgage Loan, plus accrued and
unpaid interest thereon from the date to which interest was last paid through
the day prior to the repurchase date at the applicable Mortgage Interest Rate,
plus any outstanding advances owed to any servicer in connection with such
Mortgage Loan.
Subsection 9.06 Purchaser's Right to Review. From the related
Closing Date until ninety (90) days after such Closing Date, the Purchaser shall
have the right to review each Mortgage File and Credit File, to conduct property
inspections, obtain appraisal recertifications, drive-by appraisals, brokers
price opinions and otherwise to underwrite the Mortgage Loans and to reject any
Mortgage Loan which in the Purchaser's sole opinion is an unacceptable
investment. In the event that the Purchaser so rejects any Mortgage Loan, the
Seller shall, no later than five (5) Business Days following receipt of notice
of such rejection, repurchase the rejected Mortgage Loan in the manner
prescribed in Subsection 9.03 hereof at the Purchase Price, together with
accrued and unpaid interest at the Mortgage Interest Rate through the date of
repurchase. Any rejected Mortgage Loan shall be removed from the terms of this
Agreement.
All rights of the Purchaser under this Subsection 9.06 shall
terminate upon the transfer of any Mortgage Loan to any other Purchaser.
Notwithstanding the foregoing, the fact that the Purchaser or its
designee has conducted or failed to conduct the review/due diligence procedures
specified above or any other partial or complete examination of the Mortgage
Files or Credit Files shall not impair in any way the Purchaser's or any of its
successors' rights to demand repurchase, substitution or any other remedy
provided under this Agreement.
SECTION 10. Closing. The closing for the purchase and sale of each
Mortgage Loan Package shall take place on the related Closing Date. At the
Purchaser's option, the Closing shall be either: by telephone, confirmed by
letter or wire as the parties shall agree, or conducted in person, at such place
as the parties shall agree.
The closing for the Mortgage Loans to be purchased on each Closing
Date shall be subject to each of the following conditions:
(a) at least two (2) Business Days prior to the related Closing
Date, the Seller shall deliver to the Purchaser, in electronic format acceptable
to the Purchaser in its sole discretion, a listing on a loan-level basis of the
necessary information to compute the Purchase Price of the Mortgage Loans
delivered on the Closing Date (including accrued interest), and prepare a
Mortgage Loan Schedule;
(b) all of the representations and warranties of the Seller under
this Agreement and of the Interim Servicer under the Interim Servicing Agreement
(with respect to each Mortgage Loan for an interim period, as specified therein)
shall be true and correct as of the related Closing Date and no event shall have
occurred which, with notice or the passage of time, would constitute a default
under this Agreement or an Event of Default under the Interim Servicing
Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys
shall have received in escrow, all closing documents as specified in Section 11
of this Agreement, 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 Seller shall have delivered and released to the Custodian
all documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the
Seller on the related Closing Date the Purchase Price, plus accrued interest
pursuant to Section 4 of this Agreement, by wire transfer of immediately
available funds to the account designated by the Seller.
SECTION 11. Closing Documents. The Closing Documents for the
Mortgage Loans to be purchased on each Closing Date shall consist of fully
executed originals of the following documents:
(1) this Agreement (to be executed and delivered only
for the initial Closing Date);
(2) the Interim Servicing Agreement, dated as of the
initial Cut-off Date, in the form of Exhibit B hereto (to be
executed and delivered only for the initial Closing Date);
(3) with respect to the initial Closing Date, the
Custodial Agreement, dated as of the initial Cut-off Date;
(4) the related Mortgage Loan Schedule, segregated by
Mortgage Loan Package, one copy to be attached hereto, one copy to
be attached to the Custodian's counterpart of the Custodial
Agreement, and one copy to be attached to the related Assignment and
Conveyance as the Mortgage Loan Schedule thereto;
(5) a Custodian's Certification, as required under the
Custodial Agreement, in the form of Exhibit G-1 to the Custodial
Agreement;
(6) with respect to the initial Closing Date, a
Custodial Account Letter Agreement or a Custodial Account
Certification, as applicable, as required under the Interim
Servicing Agreement;
(7) with respect to the initial Closing Date, an Escrow
Account Letter Agreement or an Escrow Account Certification, as
applicable, as required under the Interim Servicing Agreement;
(8) with respect to the initial Closing Date, an
Officer's Certificate, in the form of Exhibit C hereto with respect
to each of the Seller and the Interim Servicer, including all
attachments hereto; with respect to subsequent Closing Dates, an
Officer's Certificate upon request of the Purchaser;
(9) with respect to the initial Closing Date, an Opinion
of Counsel of each of the Seller and the Interim Servicer (who may
be an employee of the Seller or the Interim Servicer, as
applicable), in the form of Exhibit D hereto ("Opinion of Counsel of
the Seller"); with respect to subsequent Closing Dates, an Opinion
of Counsel of the Seller upon request of the Purchaser;
(10) with respect to the initial Closing Date, an
Opinion of Counsel of the Custodian (who may be an employee of the
Custodian), in the form of an exhibit to the Custodial Agreement;
(11) a Security Release Certification, in the form of
Exhibit E or F, as applicable, hereto executed by any person, as
requested by the Purchaser, if any of the Mortgage Loans have at any
time been subject to any security interest, pledge or hypothecation
for the benefit of such person;
(12) a certificate or other evidence of merger or change
of name, signed or stamped by the applicable regulatory authority,
if any of the Mortgage Loans were acquired by the Seller by merger
or acquired or originated by the Seller while conducting business
under a name other than its present name, if applicable;
(13) with respect to the initial Closing Date, the
Underwriting Guidelines to be attached to the related Assignment and
Conveyance as Exhibit C;
(14) Assignment and Conveyance Agreement in the form of
Exhibit H hereto;
(15) Exhibit B to the related Assignment and Conveyance
Agreement; and
(16) a MERS Report reflecting the Purchaser as Investor
and no Person as Interim Funder for each MERS Designated Mortgage
Loan.
The Seller shall bear the risk of loss of the closing documents
until such time as they are received by the Purchaser or its attorneys.
SECTION 12. Costs. The Purchaser shall pay any commissions due its
salesmen and the legal fees and expenses of its attorneys and custodial fees.
All other costs and expenses incurred in connection with the transfer and
delivery of the Mortgage Loans and the Servicing Rights including recording
fees, fees for title policy endorsements and continuations, fees for recording
Assignments of Mortgage, and the Seller's attorney's fees, shall be paid by the
Seller.
SECTION 13. Cooperation of Seller with a Reconstitution. The Seller
and the Purchaser agree that with respect to some or all of the Mortgage Loans,
after each Closing Date, on one or more dates (each, a "Reconstitution Date") at
the Purchaser's sole option, the Purchaser may effect a sale (each, a
"Reconstitution") of some or all of the Mortgage Loans then subject to this
Agreement, without recourse, to:
(a) Xxxxxx Xxx under its Cash Purchase Program or MBS Program
(Special Servicing Option) (each, a "Xxxxxx Mae Transfer"); or
(b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
(c) one or more third party purchasers in one or more Whole Loan
Transfers; or
(d) one or more trusts or other entities to be formed as part of one
or more Securitization Transactions.
The Seller agrees to execute in connection with any Agency Transfer,
any and all reasonably acceptable pool purchase contracts, and/or agreements
among the Purchaser, the Seller, Xxxxxx Xxx or Xxxxxxx Mac (as the case may be)
and any servicer in connection with a Whole Loan Transfer, a seller's warranties
and servicing agreement or a participation and servicing agreement in form and
substance reasonably acceptable to the parties, and in connection with a
Securitization Transaction, a pooling and servicing agreement in form and
substance reasonably acceptable to the parties or an Assignment and Recognition
Agreement substantially in the form attached hereto as Exhibit J (collectively,
the agreements referred to herein are designated, the "Reconstitution
Agreements"), together with an opinion of counsel with respect to such
Reconstitution Agreements.
With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller agrees (1) to cooperate
fully with the Purchaser and any prospective purchaser with respect to all
reasonable requests and due diligence procedures; (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 and the Interim
Servicing Agreement as of the related Reconstitution Date or make the
representations and warranties set forth in the related selling/servicing guide
of the servicer or issuer, as the case may be, or such representations or
warranties as may be required by any Rating Agency or prospective purchaser of
the related securities or such Mortgage Loans, in connection with such
Reconstitution. The Seller shall provide to such servicer or issuer, as the case
may be, and any other participants or purchasers in such Reconstitution: (i) any
and all information and appropriate verification of information which may be
reasonably available to the Seller or its affiliates, whether through letters of
its auditors and counsel or otherwise, as the Purchaser or any such other
participant shall request; and (ii) such additional representations, warranties,
covenants, opinions of counsel, letters from auditors, and certificates of
public officials or officers of the Seller or the Interim Servicer as are
reasonably believed necessary by the Purchaser or any such other participant;
and (iii) to execute, deliver and satisfy all conditions set forth in any
indemnity agreement required by the Purchaser or any such participant,
including, without limitation, an Indemnification and Contribution Agreement in
substantially the form attached hereto as Exhibit K. Moreover, the Seller agrees
to cooperate with all reasonable requests made by the Purchaser to effect such
Reconstitution Agreements. The Seller shall indemnify the Purchaser, each
affiliate of the Purchaser participating in the Reconstitution and each Person
who controls the Purchaser or such affiliate and their respective present and
former directors, officers, employees and agents, and 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 each of them may sustain in any way related to any information
provided by or on behalf of the Seller regarding the Seller, the Seller's
servicing practices or performance, the Mortgage Loans or the Underwriting
Guidelines set forth in any offering document prepared in connection with any
Reconstitution. For purposes of the previous sentence, "Purchaser" shall mean
the Person then acting as the Purchaser under this Agreement and any and all
Persons who previously were "Purchasers" under this Agreement.
In the event the Purchaser has elected to have the Interim Servicer
or the Seller hold record title to the Mortgages, prior to the Reconstitution
Date, the Interim Servicer or the Seller shall prepare an assignment of mortgage
in blank or to the prospective purchaser or trustee, as applicable, from the
Interim Servicer or the Seller, as applicable, acceptable to the prospective
purchaser or trustee, as applicable, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), track such Assignments of
Mortgage to ensure they have been recorded and deliver them as required by the
prospective purchaser or trustee, as applicable, upon the Interim Servicer's
receipt thereof. Additionally, the Interim Servicer shall prepare and execute or
shall cause the Seller to execute, at the direction of the Purchaser, any note
endorsement in connection with any and all seller/servicer agreements.
All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if the Interim
Servicing Agreement shall remain in effect with respect to the related Mortgage
Loan Package, shall continue to be serviced in accordance with the terms of this
Agreement and the Interim Servicing Agreement and with respect thereto this
Agreement shall remain in full force and effect.
SECTION 14. The Seller.
Subsection 14.01 Additional Indemnification by the Seller; Third
Party Claims.
(a) The Seller shall indemnify the Purchaser and its present and
former directors, officers, employees and agents and any Successor Servicer and
its present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees (including legal fees incurred in connection with the
enforcement of the Seller's indemnification obligation under this Section 14.01)
and related costs, judgments, and any other costs, fees and expenses that such
parties may sustain in any way related to the failure of the Seller to perform
its duties and the Interim Servicer to service the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 13 or any breach of any of Seller's
representations, warranties and covenants set forth in this Agreement (provided
that such costs shall not include any lost profits). For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
(b) Promptly after receipt by an indemnified party under this
Section 14.01 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 14.01, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve the indemnifying party from any liability which it may have to any
indemnified party under this Section 14.01, except to the extent that it has
been prejudiced in any material respect, or from any liability which it may
have, otherwise than under this Section 14.01. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent that it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party; provided that if the defendants in any
such action include both the indemnified party and the indemnifying party and
the indemnified party or parties shall have reasonably concluded that there may
be legal defenses available to it or them and/or other indemnified parties which
are different from or additional to those available to the indemnifying party,
the indemnified party or parties shall have the right to select separate counsel
to assert such legal defenses and to otherwise participate in the defense of
such action on behalf of such indemnified party or parties. Upon receipt of
notice from the indemnifying party to such indemnified party of its election so
to assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable to such indemnified party for
expenses incurred by the indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate counsel in
connection with the assertion of legal defenses in accordance with the proviso
to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with one local counsel, if applicable)), (ii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of commencement of the action or (iii) the indemnifying party
has authorized in writing the employment of counsel for the indemnified party at
the expense of the indemnifying party; and except that, if clause (i) or (iii)
is applicable, such liability shall be only in respect of the counsel referred
to in such clause (i) or (iii).
Subsection 14.02 Merger or Consolidation of the Seller. The Seller
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 Seller may be merged or consolidated, or
any corporation resulting from any merger, conversion or consolidation to which
the Seller shall be a party, or any Person succeeding to the business of the
Seller, shall be the successor of the Seller hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that the
successor or surviving Person shall have a net worth of at least $30,000,000.
SECTION 15. Financial Statements. The Seller understands that in
connection with the Purchaser's marketing of the Mortgage Loans, the Purchaser
shall make available to prospective purchasers audited financial statements of
the Seller for the most recently completed three (3) fiscal years respecting
which such statements are available, as well as a Consolidated Statement of
Condition of the Seller at the end of the last two (2) fiscal years covered by
such Consolidated Statement of Operations. The Seller shall also make available
any comparable interim statements to the extent any such statements have been
prepared by the Seller (and are available upon request to members or
stockholders of the Seller or the public at large). The Seller, if it has not
already done so, agrees to furnish promptly to the Purchaser copies of the
statements specified above. The Seller shall also make available information on
its servicing performance with respect to loans serviced for others, including
delinquency ratios.
The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by
any prospective purchaser regarding recent developments affecting the Seller or
the financial statements of the Seller.
SECTION 16. Mandatory Delivery; Grant of Security Interest. The sale
and delivery on the related Closing Date of the Mortgage Loans described on the
related Mortgage Loan Schedule is mandatory from and after the date of the
execution of the related Purchase Price and Terms Agreement, it being
specifically understood and agreed that each Mortgage Loan is unique and
identifiable on the date hereof and that an award of money damages would be
insufficient to compensate the Purchaser for the losses and damages incurred by
the Purchaser (including damages to prospective purchasers of the Mortgage
Loans) in the event of the Seller's failure to deliver (i) each of the related
Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans or (iii)
one or more Mortgage Loans otherwise acceptable to the Purchaser on or before
the related Closing Date. The Seller hereby grants to the Purchaser a lien on
and a continuing security interest in each Mortgage Loan and each document and
instrument evidencing each such Mortgage Loan to secure the performance by the
Seller of its obligations under the related Purchase Price and Terms Agreement,
and the Seller agrees that it shall hold such Mortgage Loans in custody for the
Purchaser subject to the Purchaser's (i) right to reject any Mortgage Loan (or
Qualified Substitute Mortgage Loan) under the terms of this Agreement and to
require another Mortgage Loan (or Qualified Substitute Mortgage Loan) to be
substituted therefor, and (ii) obligation to pay the Purchase Price for the
Mortgage Loans. All rights and remedies of the Purchaser under this Agreement
are distinct from, and cumulative with, any other rights or remedies under this
Agreement or afforded by law or equity and all such rights and remedies may be
exercised concurrently, independently or successively.
SECTION 17. Notices. All demands, notices and communications
hereunder shall be in writing and shall be given via email, facsimile
transmission or registered or certified mail to the person at the address set
forth below:
(i) if to the Seller:
FlexPoint Funding Corporation
00 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxxxxx Xxxxx
Fax: (000) 000-0000
Email: xxxxxx@xxxxxxxxxxx.xxx
(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: (000) 000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: (000) 000-0000
Email: xxxxxx.xxxxx@xxxxxx.xxx
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 18. Severability Clause. 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 19. Counterparts. This Agreement may be executed
simultaneously in any number of counterparts. Each counterpart shall be deemed
to be an original, and all such counterparts shall constitute one and the same
instrument.
SECTION 20. Governing Law Jurisdiction; Consent to Service of
Process. THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED
COUNTERPART THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND
SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT SHALL
BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT
TO ITS CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER
IRREVOCABLY (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH
COURT; (III) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY
SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW; AND (IV) CONSENTS
TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL
ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER.
SECTION 21. Intention of the Parties. It is the intention of the
parties that the Purchaser is purchasing, and the Seller is selling the Mortgage
Loans and not a debt instrument of the Seller or another security. Accordingly,
the parties hereto each intend to treat the transaction for Federal income tax
purposes as a sale by the Seller, and a purchase by the Purchaser, of the
Mortgage Loans. Moreover, the arrangement under which the Mortgage Loans are
held shall be consistent with classification of such arrangement as a grantor
trust in the event it is not found to represent direct ownership of the Mortgage
Loans. The Purchaser shall have the right to review the Mortgage Loans and the
related Mortgage Loan Files to determine the characteristics of the Mortgage
Loans which shall affect the Federal income tax consequences of owning the
Mortgage Loans and the Seller shall cooperate with all reasonable requests made
by the Purchaser in the course of such review.
SECTION 22. Successors and Assigns; Assignment of Purchase
Agreement. This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller and the Purchaser and the respective permitted
successors and assigns of the Seller and the successors and assigns of the
Purchaser. This Agreement shall not be assigned, pledged or hypothecated by the
Seller to a third party without the prior written consent of the Purchaser,
which consent may be withheld by the Purchaser in its sole discretion. This
Agreement may be assigned, pledged or hypothecated by the Purchaser in whole or
in part, and with respect to one or more of the Mortgage Loans, without the
consent of the Seller. There shall be no limitation on the number of assignments
or transfers allowable by the Purchaser with respect to the Mortgage Loans and
this Agreement. In the event the Purchaser assigns this Agreement, and the
assignee assumes any of the Purchaser's obligations hereunder, the Seller
acknowledges and agrees to look solely to such assignee, and not to the
Purchaser, for performance of the obligations so assumed and the Purchaser shall
be relieved from any liability to the Seller with respect thereto.
SECTION 23. Waivers. No term or provision of this Agreement may be
waived or modified unless such waiver or modification is in writing and signed
by the party against whom such waiver or modification is sought to be enforced.
SECTION 24. Exhibits. The exhibits to this Agreement are hereby
incorporated and made a part hereof and are an integral part of this Agreement.
SECTION 25. General Interpretive Principles. For purposes of this
Agreement, except as otherwise expressly provided or unless the context
otherwise requires:
(a) the terms defined in this Agreement have the meanings assigned
to them in this Agreement and include the plural as well as the singular, and
the use of any gender herein shall be deemed to include the other gender;
(b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) references herein to "Articles," "Sections," "Subsections,"
"Paragraphs," and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other subdivisions of
this Agreement;
(d) reference to a Subsection without further reference to a Section
is a reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(e) the words "herein," "hereof," "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
provision; and
(f) the term "include" or "including" shall mean without limitation
by reason of enumeration.
SECTION 26. Reproduction of Documents. This Agreement and all
documents relating thereto, including, without limitation, (a) consents, waivers
and modifications which may hereafter be executed, (b) documents received by any
party at the closing, and (c) financial statements, certificates and other
information previously or hereafter furnished, may be reproduced by any
photographic, photostatic, microfilm, micro-card, miniature photographic or
other similar process. The parties agree that any such reproduction shall be
admissible in evidence as the original itself in any judicial or administrative
proceeding, whether or not the original is in existence and whether or not such
reproduction was made by a party in the regular course of business, and that any
enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence.
SECTION 27. Further Agreements. The Seller and the Purchaser each
agree to execute and deliver to the other such reasonable and appropriate
additional documents, instruments or agreements as may be necessary or
appropriate to effectuate the purposes of this Agreement.
SECTION 28. 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 their 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 at the Seller's expense in
the event recordation is either necessary under applicable law or requested by
the Purchaser at its sole option (other than with respect to the MERS Designated
Mortgage Loans).
SECTION 29. No Solicitation. From and after the Closing Date, the
Seller agrees that it will not take any action or permit or cause any action to
be taken by any of its agents or affiliates, or by any independent contractors
on the Seller's behalf, to personally, by telephone or mail (via electronic
means or otherwise), solicit the borrower or obligor under any Mortgage Loan for
any purpose whatsoever, including to refinance a Mortgage Loan, in whole or in
part, without the prior written consent of the Purchaser. It is understood and
agreed that all rights and benefits relating to the solicitation of any
Mortgagors and the attendant rights, title and interest in and to the list of
such Mortgagors and data relating to their Mortgages (including insurance
renewal dates) shall be transferred to the Purchaser pursuant hereto on the
Closing Date and the Seller shall take no action to undermine these rights and
benefits. Notwithstanding the foregoing, it is understood and agreed that
promotions undertaken by the Seller or any affiliate of the Seller which are
directed to the general public at large, including, without limitation, mass
mailing based on commercially acquir
