EXHIBIT 99.2
MORTGAGE LOAN PURCHASE AGREEMENT
This is a Mortgage Loan Purchase Agreement (the "Agreement"), dated
April 15, 2005, between Argent Mortgage Company, LLC, a Delaware limited
liability company (the "Seller") and Argent Securities Inc., a Delaware
corporation (the "Purchaser").
PRELIMINARY STATEMENT
The Seller intends to sell the Mortgage Loans (as hereinafter defined)
to the Purchaser on the terms and subject to the conditions set forth in this
Agreement. The Purchaser shall deposit the Mortgage Loans into a mortgage pool
constituting the Trust Fund. The Trust Fund will be evidenced by a single series
of asset-backed notes designated as Series 2005-W1, (the "Notes"). The Notes
will consist of two classes of notes. The Owners Trust Certificates will be
delivered to the Seller or its designee as partial consideration for the
Mortgage Loans as further described below.
The Notes will be issued pursuant to an Indenture, dated April 19,
2005 (the "Indenture") among Argent Mortgage Loan Trust, 2005-W1 (the "Issuer")
and Deutsche Bank National Trust Company, as the indenture trustee (the
"Indenture Trustee"). Pursuant to the Sale and Servicing Agreement dated as of
April 1, 2005 (the "Sale and Servicing Agreement"), among the Argent Securities
Inc., as depositor (the "Depositor"), Issuer, Ameriquest Mortgage Company as
master servicer (the "Master Servicer") and the Indenture Trustee, the Depositor
will assign all of its right, title and interest in and to the Mortgage Loans,
together with its rights under this Agreement, to the Indenture Trustee for the
benefit of the Noteholders. Capitalized terms used but not defined herein shall
have the meanings set forth in the Sale and Servicing Agreement.
The parties hereto agree as follows:
SECTION 1. AGREEMENT TO PURCHASE. The Seller hereby sells, and the
Purchaser hereby purchases, as of April 19, 2005 (the "Closing Date"), certain
adjustable-rate and fixed-rate conventional, one- to four-family, residential
mortgage loans (the "Mortgage Loans"), having an aggregate principal balance as
of the close of business on April 1, 2005 (the "Cut-off Date") of
$2,500,000,210.84, after giving effect to all payments due on the Mortgage Loans
on or before the Cut-off Date (the "Closing Balance"), whether or not received
including the right to any Prepayment Charges collected after the Cut-off Date
from the Mortgagors in connection with any Principal Prepayments on the Mortgage
Loans. Any payments (including Prepayment Charges) collected on or before the
Cut-off Date, including all scheduled payments of principal and interest due on
or before the Cut-off Date and collected after the Cut-off Date, shall belong to
the Seller. In addition to the sale of the Mortgage Loans, the Seller will cause
certain payments made pursuant to the Interest Rate Swap Agreement to be
transferred to the Issuer.
SECTION 2. MORTGAGE LOAN SCHEDULE AND PREPAYMENT CHARGE SCHEDULE. The
Purchaser and the Seller have agreed upon which of the mortgage loans owned by
the Seller are to be purchased by the Purchaser pursuant to this Agreement, and
the Seller shall prepare or cause to be prepared on or prior to the Closing Date
a final schedule (the "Closing Schedule") describing such Mortgage Loans and
setting forth all of the Mortgage Loans to be purchased
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under this Agreement. The Closing Schedule shall conform to the requirements set
forth in this Agreement and to the definition of "Mortgage Loan Schedule" under
the Sale and Servicing Agreement. The Closing Schedule shall be used as the
Mortgage Loan Schedule under the Sale and Servicing Agreement. The Seller shall
also prepare or cause to be prepared on or prior to the Closing Date a final
schedule (the "Prepayment Charge Schedule") setting forth each Mortgage Loan
containing a Prepayment Charge and conforming to the definition of Prepayment
Charge Schedule under the Sale and Servicing Agreement.
SECTION 3. CONSIDERATION.
(a) In consideration for the Mortgage Loans to be purchased
hereunder, the Purchaser shall, as described in Section 8, (i) pay to or upon
the order of the Seller in immediately available funds an amount equal to the
net sale proceeds of the Class A-1 Notes and the Class A-2 Notes, and (ii)
deliver to the Seller or its designee the Owner Trust Certificates.
(b) [Reserved].
SECTION 4. TRANSFER OF THE MORTGAGE LOANS.
(a) POSSESSION OF MORTGAGE FILES. The Seller does hereby sell to
the Purchaser, without recourse but subject to the terms of this Agreement, all
of its right, title and interest in, to and under the Mortgage Loans, including
the related Prepayment Charges collected after the Cut-off Date. The contents of
each Mortgage File not delivered to the Purchaser or to any assignee, transferee
or designee of the Purchaser on or prior to the Closing Date are and shall be
held in trust by the Seller for the benefit of the Purchaser or any assignee,
transferee or designee of the Purchaser. Upon the sale and contribution of the
Mortgage Loans the ownership of each Mortgage Note, the related Mortgage and the
other contents of the related Mortgage File is vested in the Purchaser and the
ownership of all records and documents with respect to the related Mortgage Loan
prepared by or that come into the possession of the Seller on or after the
Closing Date shall immediately vest in the Purchaser and shall be delivered
immediately to the Purchaser or as otherwise directed by the Purchaser.
(b) DELIVERY OF MORTGAGE LOAN DOCUMENTS. The Seller will, on or
prior to the Closing Date, deliver or cause to be delivered to the Purchaser or
any assignee, transferee or designee of the Purchaser each of the following
documents for each Mortgage Loan:
(i) the original Mortgage Note, endorsed in blank without recourse or
in the following form: "Pay to the order of Deutsche Bank National Trust
Company, as Indenture Trustee under the applicable agreement, without
recourse," with all prior and intervening endorsements showing a complete
chain of endorsement from the originator to the Person so endorsing to the
Indenture Trustee, or with respect to any lost Mortgage Note, an original
Lost Note Affidavit; PROVIDED HOWEVER, that such substitutions of Lost Note
Affidavits for original Mortgage Notes may occur only with respect to
Mortgage Loans, the aggregate Cut-off Date Principal Balance of which is
less than or equal to 2.00% of the Pool Balance as of the Cut-off Date;
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(ii) the original Mortgage with evidence of recording thereon, and a
copy, certified by the appropriate recording office, of the recorded power
of attorney, if the Mortgage was executed pursuant to a power of attorney,
with evidence of recording thereon;
(iii) an original Assignment assigned in blank, without recourse;
(iv) the original recorded intervening Assignment showing a complete
chain of assignment from the originator to the Person assigning the
Mortgage to the Indenture Trustee as contemplated by the immediately
preceding clause (iii) or the original unrecorded intervening Assignments;
(v) the original or copies of each assumption, modification, written
assurance or substitution agreement, if any; and
(vi) the original lender's title insurance policy or an attorney's
opinion of title or similar, guarantee of title acceptable to mortgage
lenders generally in the jurisdiction where the Mortgaged Property is
located, together with all endorsements or riders which were issued with or
subsequent to the issuance of such policy, insuring the priority of the
Mortgage as a first lien on the Mortgaged Property represented therein as a
fee interest vested in the Mortgagor, or in the event such original title
policy is unavailable, a written commitment or uniform binder or
preliminary report of title issued by the title insurance or escrow
company.
If any document referred to in Section 4(b)(ii), 4(b)(iii) or 4(b)(iv)
above has been submitted for recording but either (x) has not been returned from
the applicable public recording office or (y) has been lost or such public
recording office has retained the original of such document, the obligations of
the Seller hereunder shall be deemed to have been satisfied upon (1) delivery by
or on behalf of the Seller promptly upon receipt thereof to the Purchaser or any
assignee, transferee or designee of the Purchaser of either the original or a
copy of such document certified by the Seller in the case of (x) above or the
public recording office in the case of (y) above to be a true and complete copy
of the recorded original thereof and (2) if such delivered copy is certified by
the Seller then in addition thereto delivery promptly upon receipt thereof of
either the original or a copy of such document certified by the public recording
office to be a true and complete copy of the original. In the event that the
original lender's title insurance policy has not yet been issued, the Seller
shall deliver to the Purchaser or any assignee, transferee or designee of the
Purchaser a written commitment or interim binder or preliminary report of title
issued by the title insurance or escrow company. Promptly upon receipt by the
Seller of any such original title insurance policy the Seller shall deliver such
to the Purchaser or any assignee, transferee or designee of the Purchaser.
The Seller shall promptly (and in no event later than thirty (30)
Business Days, subject to extension upon mutual agreement between the Seller and
the Indenture Trustee, following the later of (i) the Closing Date, (ii) the
date on which the Seller receives the Assignment from the Indenture Trustee and
(iii) the date of receipt by the Seller of the recording information for a
Mortgage) submit or cause to be submitted for recording, at no expense to the
Trust Fund or the Indenture Trustee, in the appropriate public office for real
property records,
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each Assignment referred to in (iii) and (iv) above and shall execute each
original Assignment referred to in (iii) in the following form: "Deutsche Bank
National Trust Company, as Indenture Trustee under the applicable agreement
without recourse". In the event that any such Assignment is lost or returned
unrecorded because of a defect therein, the Seller shall promptly prepare or
cause to be prepared a substitute Assignment or cure or cause to be cured such
defect, as the case may be, and thereafter cause each such Assignment to be duly
recorded. Notwithstanding the foregoing, however, for administrative convenience
and facilitation of servicing and to reduce closing costs, the Assignments shall
not be required to be submitted for recording (except with respect to any
Mortgage Loan located in Maryland) unless such failure to record would result in
a withdrawal or a downgrading by any Rating Agency of the rating on either Class
of Notes, without regard to the Policy; provided further, however, each
Assignment shall be submitted for recording by the Seller in the manner
described above, at no expense to the Trust Fund or the Indenture Trustee, upon
the earliest to occur of: (i) reasonable direction by Holders of Notes entitled
to at least 25% of the Voting Rights, (ii) failure of the Master Servicer
Termination Test, (iii) the occurrence of the bankruptcy or insolvency of the
Seller and (iv) the occurrence of a servicing transfer as described in Section
6.02 of the Sale and Servicing Agreement.
Each original document relating to a Mortgage Loan which is not
delivered to the Purchaser or its assignee, transferee or designee, if held by
the Seller, shall be so held for the benefit of the Purchaser or its assignee,
transferee or designee.
(c) ACCEPTANCE OF MORTGAGE LOANS. The documents delivered
pursuant to Section 4(b) hereof shall be reviewed by the Purchaser or any
assignee, transferee or designee of the Purchaser at any time before or after
the Closing Date (and with respect to each document permitted to be delivered
after the Closing Date within seven days of its delivery) to ascertain that all
required documents have been executed and received and that such documents
relate to the Mortgage Loans identified on the Mortgage Loan Schedule.
(d) RESERVED.
(e) TRANSFER OF INTEREST IN AGREEMENTS. The Purchaser has the
right to assign its interest under this Agreement, in whole or in part, to the
Issuer, as may be required to effect the purposes of the Indenture, without the
consent of the Seller, and the assignee shall succeed to the rights and
obligations hereunder of the Purchaser. Any expense reasonably incurred by or on
behalf of the Purchaser or the Issuer in connection with enforcing any
obligations of the Seller under this Agreement will be promptly reimbursed by
the Seller.
(f) EXAMINATION OF MORTGAGE FILES. Prior to the Closing Date,
the Seller shall either (i) deliver in escrow to the Purchaser or to any
assignee, transferee or designee of the Purchaser, for examination, the Mortgage
File pertaining to each Mortgage Loan or (ii) make such Mortgage Files available
to the Purchaser or to any assignee, transferee or designee of the Purchaser for
examination at the Indenture Trustee's offices in Santa Ana, California. Such
examination may be made by the Purchaser, and its respective designees, upon
reasonable notice to the Seller and the Indenture Trustee during normal business
hours before the Closing Date and within 60 days after the Closing Date. If any
such person makes such examination prior to the Closing Date and identifies any
Mortgage Loans that do not conform to the requirements of the
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Purchaser as described in this Agreement, such Mortgage Loans shall be deleted
from the Closing Schedule. The Purchaser may, at its option and without notice
to the Seller, purchase all or part of the Mortgage Loans without conducting any
partial or complete examination. The fact that the Purchaser or any person has
conducted or has failed to conduct any partial or complete examination of the
Mortgage Files shall not affect the rights of the Purchaser or any assignee,
transferee or designee of the Purchaser to demand repurchase or other relief as
provided herein or under the Sale and Servicing Agreement.
SECTION 5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER.
The Seller hereby represents and warrants to the Purchaser as of the
date hereof and as of the Closing Date, and covenants that:
(i) The Seller is a limited liability company duly organized,
validly existing and in good standing under the laws of the State of
Delaware and is duly authorized and qualified to transact any and all
business contemplated by this Agreement to be conducted by the Seller in
any state in which a Mortgaged Property is located or is otherwise not
required under applicable law to effect such qualification and, in any
event, is in compliance with the doing business laws of any such State;
(ii) The Seller had the full corporate power and authority to
originate, hold and sell each Mortgage Loan and has the full corporate
power and authority to service each Mortgage Loan, and to execute, deliver
and perform, and to enter into and consummate the transactions contemplated
by this Agreement and has duly authorized by all necessary corporate action
on the part of the Seller the execution, delivery and performance of this
Agreement; this Agreement has been duly executed and delivered by the
Seller and this Agreement, assuming the due authorization, execution and
delivery thereof by the Purchaser, constitutes a legal, valid and binding
obligation of the Seller, enforceable against the Seller 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;
(iii) The execution and delivery of this Agreement by the Seller,
the consummation 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 Seller and will not (A) result in a breach of any
term or provision of the charter or by-laws of the Seller 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 Seller is a party or by which it may be bound, or any statute,
order or regulation applicable to the Seller of any court, regulatory body,
administrative agency or governmental body having jurisdiction over the
Seller; and the Seller 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
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affects or, to the Seller's knowledge, would in the future materially and
adversely affect, (x) the ability of the Seller to perform its obligations
under this Agreement or (y) the business, operations, financial condition,
properties or assets of the Seller taken as a whole;
(iv) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Seller of, or compliance by the Seller with, this
Agreement or the consummation of the transactions contemplated hereby, or
if any such consent, approval, authorization or order is required, the
Seller has obtained the same;
(v) The Seller is an approved originator for Xxxxxx Xxx or
Xxxxxxx Mac in good standing and is a HUD approved mortgagee pursuant to
Section 203 and Section 211 of the National Housing Act; and
(vi) Except as otherwise disclosed in the Prospectus Supplement,
no litigation, action suit, proceeding or investigation is pending against
the Seller that would materially and adversely affect the execution,
delivery or enforceability of this Agreement or to perform any of its other
obligations hereunder in accordance with the terms hereof.
SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE SELLER RELATING TO
THE MORTGAGE LOANS.
The Seller hereby represents and warrants to the Purchaser, with
respect to the Mortgage Loans as of the Closing Date or as of such date
specifically provided herein:
(i) The information set forth on the Mortgage Loan Schedule with
respect to each Mortgage Loan is true and correct in all material respects;
(ii) [Reserved];
(iii) No material error, omission, misrepresentation, negligence,
fraud or similar occurrence with respect to a Mortgage Loan has taken place
on the part of any person, including without limitation, the Mortgagor, any
appraiser, any builder or developer, or any other party involved in the
origination of the Mortgage Loan or in the application of any insurance in
relation to such Mortgage Loan;
(iv) All payments due prior to the Cut-off Date have been made
and none of the Mortgage Loans will have been contractually delinquent for
more than one calendar month more than once since the origination thereof;
(v) Each Mortgage is a valid and enforceable first lien on the
Mortgaged Property, including all improvements thereon, subject only to (a)
the lien of nondelinquent current real property taxes and assessments, (b)
covenants, conditions and restrictions, rights of way, easements and other
matters of public record as of the date of recording of such Mortgage, such
exceptions appearing of record being acceptable to mortgage lending
institutions generally or specifically reflected in the appraisal made in
connection with the origination of the related Mortgage Loan, and (c) other
matters to
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which like properties are commonly subject which do not materially
interfere with the benefits of the security intended to be provided by such
Mortgage;
(vi) Immediately prior to the sale of the Mortgage Loans to the
Purchaser, the Seller had good title to, and was the sole legal and
beneficial owner of, each Mortgage Loan free and clear of any pledge, lien,
encumbrance 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 the same;
(vii) There is no delinquent tax or assessment lien against any
Mortgaged Property;
(viii) There is no valid offset, defense or counterclaim to any
Mortgage Note or Mortgage, including the obligation of the Mortgagor to pay
the unpaid principal of or interest on such Mortgage Note, nor will the
operation of any of the terms of the Mortgage Note and the Mortgage, or the
exercise of any right thereunder, render the Mortgage unenforceable, in
whole or in part, or subject to any valid right of rescission, set-off,
counterclaim or defense, including the defense of usury and no such valid
right of rescission, set-off, counterclaim or defense has been asserted
with respect thereto;
(ix) There are no mechanics' liens or claims for work, labor or
material rendered to the Mortgaged Property affecting any Mortgaged
Property which are or may be a lien prior to, or equal with, the lien of
the related Mortgage, except those which are insured against by the title
insurance policy referred to in (xiii) below;
(x) Subject to the Escrow Withhold referred to in (xx) below,
each Mortgaged Property is free of material damage and is in good repair
and there is no proceeding pending or to the Seller's knowledge, threatened
for the total or partial condemnation thereof nor is such proceeding
currently occurring;
(xi) Each Mortgage Loan at origination complied in all material
respects with applicable local, state and federal laws and regulations,
including, without limitation, usury, equal credit opportunity, real estate
settlement procedures, truth-in-lending, disclosure laws and all applicable
predatory and abusive lending laws, and consummation of the transactions
contemplated hereby will not involve the violation of any such laws;
(xii) Neither the Seller nor any prior holder of any Mortgage has
modified, impaired or waived the Mortgage in any material respect (except
that a Mortgage Loan may have been modified by a written instrument which
has been recorded, if necessary, to protect the interests of the Purchaser
and which has been delivered to the Indenture Trustee); satisfied, canceled
or subordinated such Mortgage in whole or in part; released the related
Mortgaged Property in whole or in part from the lien of such Mortgage; or
executed any instrument of release, cancellation, modification or
satisfaction with respect thereto;
(xiii) A lender's policy of title insurance together with a
condominium endorsement, extended coverage endorsement, and an adjustable
rate mortgage endorsement (each as applicable) in an amount at least equal
to the Cut-off Date principal
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balance of each such Mortgage Loan or a commitment (binder) to issue the
same was effective on the date of the origination of each Mortgage Loan,
each such policy is valid and remains in full force and effect, the
transfer of the related Mortgage Loan to the Purchaser will not affect the
validity or enforceability of such policy and each such policy was issued
by a title insurer qualified to do business in the jurisdiction where the
Mortgaged Property is located and in a form acceptable to Xxxxxx Xxx or
Xxxxxxx Mac, which policy insures the Seller and successor owners of
indebtedness secured by the insured Mortgage, as to the first priority lien
of the Mortgage; 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;
(xiv) Each Mortgage Loan was originated by the Seller, or an
Affiliate of the Seller, in accordance with the underwriting standards as
set forth in the Prospectus Supplement (or, if generated by an entity other
than the Seller or an Affiliate of the Seller, in accordance with such
other underwriting standards as set forth in the Prospectus Supplement (or,
if generated on behalf of the Seller by a person other than the Seller or
an Affiliate of the Seller, is subject to the same underwriting standards
and procedures used by the Seller in originating mortgage loans directly as
set forth in the Prospectus Supplement) or by a savings and loan
association, savings bank, commercial bank, credit union, insurance company
or similar institution which is supervised and examined by a federal or
state authority (including a mortgage broker), or by a mortgagee approved
by the Secretary of Housing and Urban Development pursuant to Sections 203
and 211 of the National Housing Act;
(xv) With respect to each Adjustable-Rate Mortgage Loan, on each
adjustment date, the Mortgage Rate will be adjusted to equal the Index plus
the Gross Margin, rounded to the nearest 0.125%, subject to the Periodic
Rate Cap, the Maximum Mortgage Rate and the Minimum Mortgage Rate. The
related Mortgage Note is payable on the first day of each month in
self-amortizing monthly installments of principal and interest, with
interest payable in arrears, and requires a monthly payment which is
sufficient to fully amortize the outstanding principal balance of the
Mortgage Loan over its remaining term and to pay interest at the applicable
Mortgage Rate. No Mortgage Loan is subject to negative amortization;
(xvi) All of the improvements which were included for the purpose
of determining the appraised value of the Mortgaged Property lie wholly
within the boundaries and building restriction lines of such property, and
no improvements on adjoining properties encroach upon the Mortgaged
Property, except those, if any, which are insured against by the lender's
title insurance policy referred to in (xiii) above;
(xvii) All inspections, licenses and certificates required to be
made or issued with respect to all occupied portions of the Mortgaged
Property including but not limited to certificates of occupancy, have been
made or obtained from the appropriate authorities and the Mortgaged
Property is lawfully occupied under applicable law except as may otherwise
be insured against by the lender's title insurance policy referred to in
(xiii) above;
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(xviii) All parties which have had any interest in the Mortgage,
whether as mortgagee, assignee, pledgee or otherwise, are (or, during the
period in which they held and disposed of such interest, were) in
compliance with any and all applicable licensing requirements of the laws
of the state wherein the Mortgaged Property is located;
(xix) The Mortgage Note and the related Mortgage are genuine, and
each is the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms and with applicable laws. All
parties to the Mortgage Note and the Mortgage had legal capacity to execute
the Mortgage Note and the Mortgage and each Mortgage Note and Mortgage have
been duly and properly executed by such parties;
(xx) The proceeds of each Mortgage Loan have been fully
disbursed, there is no requirement for future advances thereunder and any
and all requirements as to completion of any on-site or off-site
improvements and as to disbursements of any escrow funds therefor have been
complied with, except any Mortgaged Property or Mortgage Loan subject to an
Escrow Withhold as defined in the applicable Originator's underwriting
guidelines. All costs, fees and expenses incurred in making, closing or
recording the Mortgage Loans were paid;
(xxi) The related Mortgage contains customary and enforceable
provisions which render the rights and remedies of the holder thereof
adequate for the realization against the Mortgaged Property of the benefits
of the security, including, (i) in the case of a Mortgage designated as a
deed of trust, by trustee's sale, and (ii) otherwise by judicial
foreclosure. There is no homestead or other exemption available to the
Mortgagor which would materially interfere with the right to sell the
Mortgaged Property at a trustee's sale or the right to foreclose the
Mortgage;
(xxii) With respect to each Mortgage constituting a deed of
trust, a trustee, duly qualified under applicable law to serve as such, has
been properly designated and currently so serves and is named in such
Mortgage, and no fees or expenses are or will become payable by the
Purchaser to the trustee under the deed of trust, except in connection with
a trustee's sale after default by the Mortgagor;
(xxiii) There exist no deficiencies with respect to escrow
deposits and payments, if such are required, for which customary
arrangements for repayment thereof have not been made, and no escrow
deposits or payments of other charges or payments due the Seller have been
capitalized under the Mortgage or the related Mortgage Note;
(xxiv) The origination practices used by the Seller (or its
affiliates) with respect to each Mortgage Loan have been in all material
respects legal, proper, reasonable and customary in the subprime mortgage
origination business;
(xxv) There is no pledged account or other security other than
real estate securing the Mortgagor's obligations;
(xxvi) No Mortgage Loan has a shared appreciation feature, or
other contingent interest feature;
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(xxvii) The improvements upon each Mortgaged Property are covered
by a valid, binding and existing hazard insurance policy that is in full
force and effect with a generally acceptable carrier that provides for fire
extended coverage and such other hazards as are customary in the area where
the Mortgaged Property is located representing coverage not less than the
lesser of the outstanding principal balance of the related Mortgage Loan or
the minimum amount required to compensate for damage or loss on a
replacement cost basis. All individual insurance policies and flood
policies referred to in clause (xxviii) below contain a standard mortgagee
clause naming the Seller or the original mortgagee, and its successors in
interest, as mortgagee, and the Seller has received no notice that any
premiums due and payable thereon have not been paid; the Mortgage obligates
the Mortgagor thereunder to maintain all such insurance, including flood
insurance, at the Mortgagor's cost and expense, and upon the Mortgagor's
failure to do so, authorizes the holder of the Mortgage to obtain and
maintain such insurance at the Mortgagor's cost and expense and to seek
reimbursement therefor from the Mortgagor, except as may be limited or
restricted by applicable law;
(xxviii) If the Mortgaged Property is in an area identified in
the Federal Register by the Federal Emergency Management Agency as having
special flood hazards, a valid and binding flood insurance policy that is
in full force and effect in a form meeting the requirements of the current
guidelines of the Flood Insurance Administration is in effect with respect
to such Mortgaged Property with a generally acceptable carrier in an amount
representing coverage not less than the least of (A) the original
outstanding principal balance of the Mortgage Loan, (B) the minimum amount
required to compensate for damage or loss on a replacement cost basis or
(C) the maximum amount of insurance that is available under the Flood
Disaster Protection Act of 1973;
(xxix) There is no default, breach, violation or event of
acceleration existing under the Mortgage or the related Mortgage Note; and
no event which, with the passage of time or with notice and the expiration
of any grace or cure period (other than a delinquent payment of less than
one calendar month), would constitute a default, breach, violation or event
of acceleration and the Seller has not waived any default, breach,
violation or event of acceleration;
(xxx) Each Mortgaged Property is improved by a one- to
four-family residential dwelling, including condominium units and dwelling
units in planned unit developments, which does not include (a) cooperatives
or (b) mobile homes and manufactured homes (as defined in the Xxxxxx Xxx
Seller-Servicer's Guide), except when the appraisal indicates that (i) the
mobile or manufactured home was built under the Federal Manufactured Home
Construction and Safety Standards of 1976 or (ii) otherwise assumes the
characteristics of site-built housing and meets local building codes, is
readily marketable, has been permanently affixed to the site, is not in a
mobile home "park," and is treated as real property under the applicable
state law. With respect to any Mortgage Loan that is secured by a leasehold
estate: (a) the lease is valid, in full force and effect; (b) all rents and
other payments due under the lease have been paid; (c) the lessee is not in
default under any provision of the lease; (d) the term of the lease exceeds
the maturity date of the related Mortgage Loan by at least five (5) years
and (e) the Mortgagee under
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the Mortgage Loan is given notice and an opportunity to cure any defaults
under the lease;
(xxxi) There is no obligation on the part of the Seller or any
other party under the terms of the Mortgage or related Mortgage Note to
make payments in lieu of or in addition to those made by the Mortgagor;
(xxxii) Any future advances made prior to the Cut-off Date have
been consolidated with the outstanding principal amount secured by the
Mortgage, and the secured principal amount, as consolidated, bears a single
interest rate and single repayment term reflected on the Mortgage Loan
Schedule. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
(xxxiii) The Mortgage File contains an appraisal which was
performed by an appraiser who satisfied, and which was conducted in
accordance with, all of the applicable requirements of the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, as amended;
(xxxiv) None of the Mortgage Loans is a graduated payment
mortgage loan, nor is any Mortgage Loan subject to a temporary buydown or
similar arrangement;
(xxxv) [Reserved];
(xxxvi) The Mortgage Loans comply in all material respects with
the descriptions set forth under the captions "The Mortgage Pool" in the
Depositor's Prospectus Supplement, dated the date hereof (the "Prospectus
Supplement");
(xxxvii) 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 related Mortgaged Property is sold or
transferred without the prior written consent of the mortgagee thereunder,
except as may be limited by applicable law;
(xxxviii)The information set forth in the Prepayment Charge
Schedule is complete, true and correct in all material respects at the date
or dates respecting which such information is furnished and each Prepayment
Charge is permissible and enforceable in accordance with its terms upon the
full and voluntary prepayment by the Mortgagor under applicable law (except
to the extent that: (1) the enforceability thereof may be limited by
bankruptcy, insolvency, moratorium, receivership and other similar laws
relating to creditors' rights generally; or (2) the collectability thereof
may be limited due to acceleration in connection with a foreclosure or
other involuntary payoff;
(xxxix) Each Mortgage Loan is an obligation that is principally
secured by real property for purposes of the REMIC Provisions of the Code;
(xl) The Mortgage Loans are not subject to the requirements of
the Home Ownership and Equity Protection Act of 1994 ("HOEPA") and no
Mortgage Loan is subject to, or in violation of, any applicable state or
local law, ordinance or regulation similar to HOEPA.
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(xli) (a) No Mortgage Loan is a High Cost Loan as defined by
HOEPA or any other applicable predatory or abusive lending laws and (b) no
Mortgage Loan is a "high cost home", "covered" (excluding home loans
defined as "covered home loans" in the New Jersey Home Ownership Security
Act of 2002 that were originated between November 26, 2003 and July 7,
2004) , "high risk home" or "predatory" 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 resident mortgage loans having high interest
rates, points and/or fees);
(xlii) No proceeds from any Mortgage Loan were used to finance
single-premium credit insurance policies;
(xliii) Any Mortgage Loan originated before October 1, 2002, and
any non-subprime Mortgage Loans, will not impose a Prepayment Charge for a
term in excess of five years and no subprime Mortgage Loan originated on or
after October 1, 2002 will impose a Prepayment Charge for a term in excess
of three years;
(xliv) No Mortgage Loan that is secured by property located in
the State of Georgia is either a "Covered Loan" or "High Cost Home Loan"
within the meaning of the Georgia Fair Lending Act, as amended (the
"Georgia Act");
(xlv) No Mortgagor has currently requested any relief under the
Servicemembers' Civil Relief Act or similar state laws;
(xlvi) No Mortgage Loan secured by a Mortgaged Property located
in Georgia was originated on or after October 1, 2002 and before March 7,
2003;
(xlvii) The Prepayment Charges included in the transaction are
enforceable and originated in compliance with all applicable federal, state
and local law;
(xlviii) No Mortgage Loan in the transaction originated in the
City of Oakland is subject to the City of Oakland California Ordinance
12361 as a home loan;
(xlix) No Mortgage Loan in the transaction originated in the City
of Los Angeles is subject to the City of Los Angeles California Ordinance
175008 as a home loan;
(l) No Mortgage Loan, except as identified in detail to the
Rating Agencies, is a Section 10 mortgage under the Oklahoma Home Ownership
and Equity Protection Act;
(li) No Mortgage Loan is a "High-Cost Home Loan" as defined under
the Maine House Xxxx 383 X.X. 494, effective as of September 13, 2003;
(lii) No Mortgage Loan is a "Home Loan" as defined under the
Nevada Assembly Xxxx No. 284, effective as of October 1, 2003, and the
Nevada home loans comply with all applicable laws; and
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(liii) No Mortgage Loan is a high cost loan or a covered loan, as
applicable (as such terms are defined in Standard & Poor's LEVELS Version
5.6 Glossary Revised, Appendix E); and
(liv) With respect to any Mortgage Loan originated on or after
August 1, 2004, neither the related Mortgage nor the related Mortgage Note
requires the borrower to submit to arbitration to resolve any dispute
arising out of or relating in any way to the Mortgage Loan transactions.
SECTION 7. REPURCHASE OBLIGATION FOR DEFECTIVE DOCUMENTATION AND FOR
BREACH OF REPRESENTATION AND WARRANTY.
(a) The representations and warranties contained in Section 6
shall not be impaired by any review and examination of loan files or other
documents evidencing or relating to the Mortgage Loans or any failure on the
part of the Purchaser to review or examine such documents and shall inure to the
benefit of any assignee, transferee or designee of the Purchaser, including the
Indenture Trustee for the benefit of the Noteholders.
Upon discovery by the Seller, the Note Insurer, the Purchaser or any
assignee, transferee or designee of the Purchaser of any materially defective
document in, or that any material document was not transferred by the Seller (as
listed on the Indenture Trustee's Preliminary Exception Report), as part of, any
Mortgage File or of a breach of any of the representations and warranties
contained in Section 5 or Section 6 that materially and adversely affects the
value of any Mortgage Loan or the interest therein of the Purchaser, the Note
Insurer or the Purchaser's assignee, transferee or designee (it being understood
that with respect to the representations and warranties set forth in (xli),
(xlii), (xliii), (xliv) and (xlvi) of Section 6 herein, a breach of any such
representation or warranty shall in and of itself be deemed to materially
adversely affect the interest therein of the Purchaser, the Note Insurer and the
Purchaser's assignee, transferee or designee), the party discovering the breach
shall give prompt written notice to the other. Within ninety (90) days of its
discovery or its receipt of notice of any such missing documentation which was
not transferred to the Purchaser as described above or materially defective
documentation or any such breach of a representation and warranty (it being
understood that with respect to the representations and warranties set forth in
(xli), (xlii), (xliii), (xliv) and (xlvi) of Section 6 herein, a breach of any
such representation or warranty shall in and of itself be deemed to materially
adversely affect the interest therein of the Purchaser, the Note Insurer and the
Purchaser's assignee, transferee or designee), the Seller promptly shall deliver
such missing document or cure such defect or breach in all material respects, or
in the event the Seller cannot deliver such missing document or such defect or
breach cannot be cured, the Seller shall, within 90 days of its discovery or
receipt of notice, either (i) repurchase the affected Mortgage Loan at a price
equal to the Purchase Price or (ii) pursuant to the provisions of the Sale and
Servicing Agreement, cause the removal of such Mortgage Loan from the Trust Fund
and substitute one or more Qualified Substitute Mortgage Loans. In the event
that any Mortgage Loan is subject to a breach of the representation and warranty
in Section 6(xxxix) resulting in the Master Servicer's inability to collect all
or part of the Prepayment Charge from the Mortgagor, in lieu of repurchase, the
Seller shall be obligated to remit to the Master Servicer (for deposit in the
Collection Account) any shortfall in the Prepayment Charge collected upon the
Mortgagor's voluntary Principal Prepayment.
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The Seller shall amend the Closing Schedule to reflect the withdrawal
of such Mortgage Loan from the terms of this Agreement and the Sale and
Servicing Agreement and the addition, if any, of a Qualified Substitute Mortgage
Loan. The Seller shall deliver to the Purchaser such amended Closing Schedule
and shall deliver such other documents as are required by this Agreement or the
Sale and Servicing Agreement within five (5) days of any such amendment. Any
repurchase pursuant to this Section 7(a) shall be accomplished by deposit in the
Collection Account of the amount of the Purchase Price in accordance with
Section 2.03 of the Sale and Servicing Agreement. Any repurchase or substitution
required by this Section shall be made in a manner consistent with Section 2.03
of the Sale and Servicing Agreement. If after a Mortgage Loan has been
liquidated pursuant to the Sale and Servicing Agreement and the Pool Insurer
discovers a breach of any of the representations and warranties contained in
Section 5 or Section 6 of this Agreement or the Exhibit to the Pool Policy and
such breach either directly caused a Realized Loss or increased the amount of
the Realized Loss, then the Seller shall reimburse (x) the Trust Fund (to the
extent no claim on the Pool Policy has been made with respect to such Realized
Loss) in an amount equal to the reduction, if any, of the Overcollateralized
Amount related to such Realized Loss or (y) to the Pool Insurer (to the extent
the Pool Insurer has paid a claim under the Pool Policy relating to such
Realized Loss) in an amount equal to amount paid by the Pool Insurer under the
Pool Policy with respect to such Realized Loss, within ninety (90) days after
its discovery or receipt of notice of such breach; provided, however, that the
amount owed by the Seller pursuant to such breach, together with the amount of
any liquidation proceeds or other proceeds realized from the disposition of such
Mortgage Loan will not exceed the Purchase Price of such Mortgage Loan as if
such Mortgage Loan were still part of the Trust Estate at the time liquidation.
In addition, upon discovery by the Seller, the Purchaser, or any
assignee, transferee or designee of the Purchaser that any Mortgage Loan does
not constitute a "qualified mortgage" within the meaning of Section 860G(a)(3)
of the Code, the party discovering the breach shall give prompt written notice
within five Business Days to the others. Within ninety (90) days of its
discovery or its receipt of notice, the Seller promptly shall either (i)
repurchase the affected Mortgage Loan at the Purchase Price (as such term is
defined in the Sale and Servicing Agreement) or (ii) pursuant to the provisions
of the Sale and Servicing Agreement, cause the removal of such Mortgage Loan
from the Trust Fund and substitute one or more Qualified Substitute Mortgage
Loans.
(b) It is understood and agreed that the obligations of the
Seller set forth in this Section 7 to cure, remit a Prepayment Charge shortfall,
repurchase or substitute for a defective Mortgage Loan, or any other obligation
of the Seller as set forth in Section 7(a) constitute the sole remedies of the
Purchaser against the Seller respecting a missing or defective material document
or a breach of the representations and warranties contained in Section 5 or
Section 6.
SECTION 8. CLOSING; PAYMENT FOR THE MORTGAGE LOANS. The closing of the
purchase and sale of the Mortgage Loans shall be held at the New York City
office of Xxxxxxx Xxxxxxxx & Xxxx LLP at 10:00 AM New York City time on the
Closing Date.
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The closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of the Seller under
this Agreement shall be true and correct in all material respects
as of the date as of which they are made and no event shall have
occurred which, with notice or the passage of time, would
constitute a default under this Agreement;
(b) The Purchaser shall have received, or the attorneys of the
Purchaser shall have received in escrow (to be released from
escrow at the time of closing), all Closing Documents as
specified in Section 9 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
respective terms thereof;
(c) The Seller shall have delivered or caused to be delivered and
released to the Purchaser or to its designee, all documents
(including without limitation, the Mortgage Loans) required to be
so delivered by the Purchaser pursuant to Section 2.01 of the
Sale and Servicing Agreement; and
(d) All other terms and conditions of this Agreement shall have been
complied with.
Subject to the foregoing conditions, the Purchaser shall deliver or
cause to be delivered to the Seller on the Closing Date, against delivery and
release by the Seller to the Indenture Trustee of all documents required
pursuant to the Sale and Servicing Agreement, the consideration for the Mortgage
Loans as specified in Section 3 of this Agreement, by delivery to the Seller of
the Purchase Price.
SECTION 9. CLOSING DOCUMENTS. Without limiting the generality of
Section 8 hereof, the closing shall be subject to delivery of each of the
following documents:
(a) An Officers' Certificate of the Seller, dated the Closing Date,
in form satisfactory to and upon which the Purchaser and the
Underwriters may rely, and attached thereto copies of the
certificate of formation, by-laws and certificate of good
standing of the Seller under the laws of Delaware and stating
that the information contained in the Prospectus Supplement,
relating to the Mortgage Loans, the Seller, and its loan
portfolio, is true and accurate in all material respects and does
not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances
under which they were made, not misleading;
(b) An Officers' Certificate of the Seller, dated the Closing Date,
in form satisfactory to and upon which the Purchaser and the
Underwriters may rely, with respect to certain facts regarding
the sale of the Mortgage Loans by the Seller to the Purchaser;
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(c) An Opinion of Counsel of the Seller, dated the Closing Date, in
form satisfactory to and addressed to the Purchaser and the
Underwriters;
(d) Such opinions of counsel from the Purchaser's or Seller's counsel
as the Rating Agencies may request in connection with the sale of
the Mortgage Loans by the Seller to the Purchaser or the Seller's
execution and delivery of, or performance under, this Agreement
and upon which the Underwriters may rely;
(e) A letter from Deloitte & Touche L.L.P., certified public
accountants, dated the date hereof and to the effect that they
have performed certain specified procedures as a result of which
they determined that certain information of an accounting,
financial or statistical nature set forth in the Prospectus
Supplement, under the captions "Summary of Prospectus
Supplement", "Risk Factors", "The Mortgage Pool", "Yield on the
Notes", "Description of the Notes", "Sale and Servicing
Agreement--The Seller", and "Sale and Servicing Agreement--The
Master Servicer" agrees with the records of the Seller;
(f) The Seller shall deliver for inclusion in the Prospectus
Supplement under the captions "The Mortgage Pool--Underwriting
Standards; Representations" and "Sale and Servicing
Agreement--The Seller", or for inclusion in other offering
material such publicly available information regarding its
financial condition and its mortgage loan delinquency,
foreclosure and loss experience, underwriting standards, lending
activities and loan sales, production, and servicing and
collection practices, and any similar nonpublic, unaudited
financial information; and
(g) Such further information, certificates, opinions and documents as
the Purchaser or the Underwriters may reasonably request.
SECTION 10. COSTS. The Seller shall pay (or shall reimburse the
Purchaser or any other Person to the extent that the Purchaser or such other
Person shall pay) all costs and expenses incurred in connection with the
transfer and delivery of the Mortgage Loans, including without limitation,
assignment of mortgage recording costs and/or fees for title policy endorsements
and continuations, the fees and expenses of the Seller's in-house accountants
and in-house attorneys, the costs and expenses incurred in connection with
producing the Seller's loan loss, foreclosure and delinquency experience, and
the costs and expenses incurred in connection with obtaining the documents
referred to in Sections 9(d) and 9(e) to the extent such costs and expenses were
not previously paid by the Seller. The Seller shall pay (or shall reimburse the
Purchaser or any other Person to the extent that the Purchaser or such other
Person shall pay) the costs and expenses of printing (or otherwise reproducing)
and delivering this Agreement, the Sale and Servicing Agreement, the Notes, the
prospectus, the Prospectus Supplement, and the Indenture relating to the Notes
and other related documents, the initial fees, costs and expenses of the
Indenture Trustee relating to the issuance of the initial certification of the
Indenture Trustee under Section 2.02 of the Sale and Servicing Agreement, the
fees and expenses of the Seller's counsel in connection with the preparation of
all documents relating to
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the securitization of the Mortgage Loans, the filing fee charged by the
Securities and Exchange Commission for registration of the Notes, the cost of
outside special counsel that may be required for the Purchaser, the cost of
obtaining the documents referred to in Section 9(g) and the fees charged by any
rating agency to rate the Notes. All other costs and expenses in connection with
the transactions contemplated hereunder shall be borne by the party incurring
such expense.
SECTION 11. [Reserved]
SECTION 12. [Reserved]
SECTION 13. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST. The sale
and delivery on the Closing Date of the Mortgage Loans described on the Mortgage
Loan Schedule in accordance with the terms and conditions of this Agreement is
mandatory. It is 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 in the event of the Seller's failure to deliver the
Mortgage Loans on or before the Closing Date. The Seller hereby grants to the
Purchaser a lien on and a continuing security interest in the Seller's interest
in each Mortgage Loan and each document and instrument evidencing each such
Mortgage Loan to secure the performance by the Seller of its obligation
hereunder, and the Seller agrees that it holds such Mortgage Loans in custody
for the Purchaser, subject to the Purchaser's (i) right, prior to the Closing
Date, to reject any Mortgage Loan to the extent permitted by this Agreement, and
(ii) obligation to deliver or cause to be delivered the consideration for the
Mortgage Loans pursuant to Section 8 hereof. Any Mortgage Loans rejected by the
Purchaser shall concurrently therewith be released from the security interest
created hereby. The Seller agrees that, upon acceptance of the Mortgage Loans by
the Purchaser or its designee and delivery of payment to the Seller, that its
security interest in the Mortgage Loans shall be released. 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.
Notwithstanding the foregoing, if on the Closing Date, each of the
conditions set forth in Section 8 hereof shall have been satisfied and the
Purchaser shall not have paid or caused to be paid the Purchase Price, or any
such condition shall not have been waived or satisfied and the Purchaser
determines not to pay or cause to be paid the Purchase Price, the Purchaser
shall immediately effect the redelivery of the Mortgage Loans, if delivery to
the Purchaser has occurred and the security interest created by this Section 13
shall be deemed to have been released.
SECTION 14. NOTICES. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered to or mailed by registered mail, postage prepaid, or transmitted by
telex or telegraph and confirmed by a similar mailed writing, if to the
Purchaser, addressed to the Purchaser at 0000 Xxxx & Xxxxxxx Xxxx, Xxxxx 0000,
-00-
Xxxxxx, Xxxxxxxxxx 00000, Facsimile: (000) 000-0000, Attention: General Counsel,
or such other address as may hereafter be furnished to the Seller in writing by
the Purchaser; if to the Seller, addressed to the Seller at 0000 Xxxx & Xxxxxxx
Xxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxxxx 00000, Facsimile: (000) 000-0000,
Attention: General Counsel, or to such other address as the Seller may designate
in writing to the Purchaser.
SECTION 15. SEVERABILITY OF PROVISIONS. Any part, provision,
representation or warranty of this Agreement which is prohibited or which is
held to be void or unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof. Any part, provision, representation or warranty of this Agreement which
is prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective 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.
SECTION 16. AGREEMENT OF PARTIES. The Seller and the Purchaser agree
to execute and deliver such instruments and take such actions as either of the
others may, from time to time, reasonably request in order to effectuate the
purpose and to carry out the terms of this Agreement and the Sale and Servicing
Agreement.
SECTION 17. SURVIVAL. The Seller agrees that the representations,
warranties and agreements made by it herein and in any certificate or other
instrument delivered pursuant hereto shall be deemed to be relied upon by the
Purchaser, notwithstanding any investigation heretofore or hereafter made by the
Purchaser or on its behalf, and that the representations, warranties and
agreements made by the Seller herein or in any such certificate or other
instrument shall survive the delivery of and payment for the Mortgage Loans and
shall continue in full force and effect, notwithstanding any restrictive or
qualified endorsement on the Mortgage Notes and notwithstanding subsequent
termination of this Agreement, the Sale and Servicing Agreement or the Trust
Fund.
SECTION 18. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES,
OBLIGATIONS AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS (EXCLUDING THE CHOICE OF LAW PROVISIONS)
AND DECISIONS OF THE STATE OF NEW YORK. THE PARTIES HERETO INTEND THAT THE
PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY
TO THIS AGREEMENT.
SECTION 19. MISCELLANEOUS. This Agreement may be executed in two or
more counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one and the same
instrument. This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and assigns. This Agreement
supersedes all prior agreements and understandings relating to the subject
matter hereof. 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. The headings in this Agreement are for purposes of
reference only and shall not limit or otherwise affect the meaning
-19-
hereof. Each of the Note Insurer and the Pool Insurer shall be a third party
beneficiary hereof and enforce the terms hereof as if it is a party hereto.
It is the express intent of the parties hereto that the conveyance of
the Mortgage Loans by the Seller to the Purchaser as provided in Section 4
hereof be, and be construed as, a sale of the Mortgage Loans by the Seller to
the Purchaser and not as a pledge of the Mortgage Loans by the Seller to the
Purchaser to secure a debt or other obligation of the Seller. However, in the
event that, notwithstanding the aforementioned intent of the parties, the
Mortgage Loans are held to be property of the Seller, then, (a) it is the
express intent of the parties that such conveyance be deemed a pledge of the
Mortgage Loans by the Seller to the Purchaser to secure a debt or other
obligation of the Seller and (b) (1) this Agreement shall also be deemed to be a
security agreement within the meaning of Articles 8 and 9 of the New York
Uniform Commercial Code; (2) the conveyance provided for in Section 4 hereof
shall be deemed to be a grant by the Seller to the Purchaser of a security
interest in all of the Seller's right, title and interest in and to the Mortgage
Loans and all amounts payable to the holders of the Mortgage Loans in accordance
with the terms thereof and all proceeds of the conversion, voluntary or
involuntary, of the foregoing into cash, instruments, securities or other
property, including without limitation all amounts, other than investment
earnings, from time to time held or invested in the Collection Account whether
in the form of cash, instruments, securities or other property; (3) the
possession by the Purchaser or its agent of Mortgage Notes, the related
Mortgages and such other items of property that constitute instruments, money,
negotiable documents or chattel paper shall be deemed to be "possession" for
purposes of perfecting the security interest pursuant to the New York Uniform
Commercial Code; and (4) notifications to persons holding such property, and
acknowledgments, receipts or confirmations from persons holding such property,
shall be deemed notifications to, or acknowledgments, receipts or confirmations
from, financial intermediaries, bailees or agents (as applicable) of the
Purchaser for the purpose of perfecting such security interest under applicable
law. Any assignment of the interest of the Purchaser pursuant to Section 4(d)
hereof shall also be deemed to be an assignment of any security interest created
hereby. The Seller and the Purchaser 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 Mortgage Loans, such
security interest would be deemed to be a perfected security interest of first
priority under applicable law and will be maintained as such throughout the term
of this Agreement and the Sale and Servicing Agreement.
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed by their respective officers thereunto duly authorized as of
the date first above written.
ARGENT MORTGAGE COMPANY, LLC
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxx
Title: EVP
ARGENT SECURITIES INC.
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxx
Title: CFO
