Exhibit 99.1
EXECUTION COPY
MORTGAGE LOAN PURCHASE AGREEMENT
between
XXXXXXX XXXXX MORTGAGE LENDING, INC.
as Seller
and
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
as Purchaser
Dated as of
December 1, 2006
TABLE OF CONTENTS
Section 1. Definitions............................................... 1
Section 2. Purchase and Sale of the Mortgage Loans and Related
Rights................................................. 4
Section 3. Mortgage Loan Schedule.................................... 5
Section 4. Mortgage Loan Transfer.................................... 5
Section 5. Examination of Mortgage Files............................. 6
Section 6. Sale Treatment............................................ 9
Section 7. Representations and Warranties of Seller Concerning the
Mortgage Loans......................................... 9
Section 8. Representations and Warranties Concerning the Seller...... 20
Section 9. Representations and Warranties Concerning the Purchaser... 21
Section 10. Conditions to Closing..................................... 22
Section 11. Fees and Expenses......................................... 24
Section 12. Accountants' Letters...................................... 25
Section 13. Indemnification........................................... 25
Section 14. Notices................................................... 27
Section 15. Transfer of Mortgage Loans................................ 27
Section 16. Termination............................................... 27
Section 17. Representations, Warranties and Agreements to Survive
Delivery............................................... 28
Section 18. Mandatory Delivery; Grant of Security Interest............ 28
Section 19. Severability.............................................. 29
Section 20. Counterparts.............................................. 29
Section 21. Amendment................................................. 29
Section 22. GOVERNING LAW............................................. 29
Section 23. Further Assurances........................................ 29
Section 24. Successors and Assigns.................................... 29
Section 25. The Seller................................................ 30
Section 26. Entire Agreement.......................................... 30
Section 27. No Partnership............................................ 30
EXHIBIT 1 MORTGAGE LOAN SCHEDULE INFORMATION........................ E-1-1
EXHIBIT 2 SELLER'S INFORMATION...................................... E-2-1
EXHIBIT 3 PURCHASER'S INFORMATION................................... E-3-1
EXHIBIT 4 CONTENTS OF EACH MORTGAGE FILE............................ E-4-1
EXHIBIT 5 APPENDIX E -- Standard & Poor's Predatory Lending
Categories............................................. E-5-1
Schedule A MORTGAGE LOAN SCHEDULE.................................... A-1
Schedule B REQUIRED RATINGS FOR EACH CLASS OF CERTIFICATES........... B-1
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MORTGAGE LOAN PURCHASE AGREEMENT
MORTGAGE LOAN PURCHASE AGREEMENT, dated as of December 1, 2006 (the
"Agreement"), by and between XXXXXXX XXXXX MORTGAGE LENDING, INC., a Delaware
corporation having an office at 000 Xxxxx Xxxxxx, 4 World Financial Center, New
York, New York 10080 (the "Seller"), and XXXXXXX XXXXX MORTGAGE INVESTORS, INC.,
a Delaware corporation having an office at 000 Xxxxx Xxxxxx, 4 World Financial
Center, New York, New York 10080 (the "Purchaser").
Upon the terms and subject to the conditions of this Agreement, the Seller
agrees to sell, and the Purchaser agrees to purchase, certain first lien,
fixed-and adjustable-rate mortgage loans secured by one- to four-family
residences, townhouses, individual condominiums, co-op units and units in
planned unit developments (collectively, the "Mortgage Loans") as described
herein. The Purchaser intends to deposit the Mortgage Loans into a trust fund
(the "Trust Fund" or the "Issuing Entity") and create Mortgage Asset-Backed
Certificates, Series 2006-FF1 (the "Certificates"), under a pooling and
servicing agreement, to be dated as of December 1, 2006 (the "Pooling and
Servicing Agreement"), by and among the Purchaser, as depositor, LaSalle Bank,
National Association, as trustee (the "Trustee") and National City Home Loan
Services, Inc. (the "Servicer").
The Purchaser has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (Number 333-130545) relating
to its Mortgage Asset-Backed Certificates and the offering of certain series
thereof (including certain classes of the Certificates) from time to time in
accordance with Rule 415 under the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder (the "Securities
Act"). Such registration statement, when it became effective under the
Securities Act, and the prospectus relating to the public offering of certain
classes of the Certificates by the Purchaser (the "Public Offering"), as from
time to time each is amended or supplemented pursuant to the Securities Act or
otherwise, are referred to herein as the "Registration Statement" and the
"Prospectus," respectively. The "Prospectus Supplement" shall mean that
supplement, dated December 21, 2006 to the Prospectus, dated September 8, 2006,
relating to certain classes of the Certificates. With respect to the Public
Offering of certain classes of the Certificates, the Purchaser and Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx") have entered into a
terms agreement dated as of December 20, 2006 to an underwriting agreement dated
February 28, 2003, between the Purchaser and Xxxxxxx Xxxxx (together, the
"Underwriting Agreement").
Now, therefore, in consideration of the premises and the mutual agreements
set forth herein, the parties hereto agree as follows:
Section 1. Definitions.
Certain terms are defined herein. Capitalized terms used herein but not
defined herein shall have the meanings specified in the Pooling and Servicing
Agreement. The following other terms are defined as follows:
Accepted Servicing Practices: With respect to any Mortgage Loan, the
Servicer's normal mortgage servicing practices (including collection procedures)
which, as of a particular date, will conform to the mortgage servicing practices
of prudent mortgage lending institutions that service for their own account
mortgage loans of the same type as the Mortgage Loans in the jurisdiction where
the related Mortgaged Property is located.
Adjustable Rate Mortgage Loan: A Mortgage Loan which provides for the
adjustment of the Mortgage Interest Rate payable in respect thereto.
Adjustment Date: With respect to each Adjustable Rate Mortgage Loan, the
date set forth in the related Mortgage Note on which the Mortgage Interest Rate
on such Adjustable Rate Mortgage Loan is adjusted in accordance with the terms
of the related Mortgage Note.
Appraised Value: With respect to any Mortgaged Property, the lesser of (i)
the value thereof as determined by an appraisal made for the originator of the
Mortgage Loan at the time of origination of the Mortgage Loan either by a
Qualified Appraiser or pursuant to the Automated Valuation Model as set forth in
the Originator's Underwriting Guidelines, and (ii) the purchase price paid for
the related Mortgaged Property by the Mortgagor with the proceeds of the
Mortgage Loan, provided, however, in the case of a Refinanced Mortgage Loan,
such value of the Mortgaged Property is based solely upon the value determined
by an appraisal made for the originator of such Refinanced Mortgage Loan at the
time of origination of such Refinanced Mortgage Loan either by a Qualified
Appraiser or pursuant to the Automated Valuation Model as set forth in the
Originator's Underwriting Guidelines.
Automated Value Model: A statistical mood or algorithm that estimates the
market value of the subject property as of a particular date.
Balloon Loan: A Mortgage Loan identified on the Mortgage Loan Schedule as a
balloon mortgage loan.
Closing Date: December 27, 2006.
Cut-off Date Balance: $2,375,911,775.
Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced by a
Replacement Mortgage Loan.
Due Date: With respect to each Mortgage Loan, the first day in each month.
Fixed Rate Mortgage Loan: A Mortgage Loan with respect to which the
Mortgage Interest Rate set forth in the Mortgage Note is fixed for the term of
such Mortgage Loan.
FNMA: Xxxxxx Mae or any successor thereto.
Xxxxxxx Mac: The Federal Home Loan Mortgage Corporation or any successor
thereto.
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Index: With respect to any Adjustable Rate Mortgage Loan, the index
identified on the Mortgage Loan Schedule and set forth in the related Mortgage
Note for the purpose of calculating the interest rate thereon.
Xxxxxxx Xxxxx: Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated.
Monthly Payment: With respect to any Mortgage Loan, the scheduled combined
payment of principal and interest payable by a Mortgagor under the related
Mortgage Note on each Due Date.
Moody's: Xxxxx'x Investors Service, Inc., or its successors in interest.
Mortgage: The mortgage or deed of trust creating a first lien on an
interest in real property securing a Mortgage Note.
Mortgage File: The items set out on Exhibit 4 hereto pertaining to a
particular Mortgage Loan.
Mortgage Interest Rate: The annual rate of interest borne by a Mortgage
Note as stated therein.
Mortgage Loan Schedule: The schedule of Mortgage Loans to be annexed hereto
as Schedule A on the Closing Date setting forth the information contained on
Exhibit 1 hereto.
Mortgage Note: The original executed note or other evidence of the Mortgage
Loan indebtedness of a Mortgagor.
Mortgaged Property: The Mortgagor's real property securing repayment of a
related Mortgage Note, consisting of a fee simple interest or leasehold interest
in a single parcel of real property improved by a Residential Dwelling.
Mortgagor: The obligor(s) on a Mortgage Note.
Offered Certificates: Shall mean the Class A-1 Certificates, the Class A-2A
Certificates, the Class A-2B Certificates, the Class A-2C Certificates, the
Class R Certificates, the Class M-1 Certificates, Class M-2 Certificates, the
Class M-3 Certificates, the Class M-4 Certificates, the Class M-5 Certificates,
the Class M-6 Certificates, the Class B-1 Certificates, the Class B-2
Certificates and the Class B-3 Certificates issued pursuant to the Pooling and
Servicing Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel for
the Seller or the Purchaser, reasonably acceptable to the Trustee.
Origination Date: The date on which a Mortgage Loan funded.
Originator: First Franklin Financial Corporation, a Delaware corporation.
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Originator's Underwriting Guidelines: The underwriting guidelines in effect
as of the applicable Origination Date, used by the Originator or National City
Bank's First Franklin Division in originating and/or acquiring Mortgage Loans,
including the restrictions applicable thereto, as amended from time to time, and
which have been provided or made available to the Purchaser.
Person: Any legal person, including any individual, corporation,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
Prepayment Charge: With respect to any Mortgage Loan, the premiums, fees,
or charges, if any, due in connection with a full or partial prepayment of such
Mortgage Loan in accordance with the terms thereof.
Purchase Price: With respect to any Mortgage Loan required to be purchased
by the Seller pursuant to the applicable provisions of this Agreement, an amount
equal to the sum of (i) 100% of the principal remaining unpaid on such Mortgage
Loan as of the date of purchase (including if a foreclosure has already
occurred, the principal balance of the related Mortgage Loan at the time the
Mortgaged Property was acquired), (ii) accrued and unpaid interest thereon at
the Mortgage Interest Rate through and including the last day of the month of
purchase and (iii) any costs and damages incurred by the Issuing Entity in
connection with any violation by such Mortgage Loan of any predatory or
abusive-lending law.
Qualified Appraiser: A state licensed or certified appraiser, duly
appointed by the 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 such appraiser and the appraisal made by such appraiser both satisfy
the requirements of Title XI of FIRREA and the regulations promulgated
thereunder with respect to appraisals (as in effect on the date the appraisal
was made).
Rating Agencies: S&P and Moody's, each a "Rating Agency."
Residential Dwelling: Any one of the following: (i) a detached one-family
dwelling, (ii) a detached two- to four-family dwelling, (iii) a one-family
dwelling unit in a condominium project which meets the eligibility requirements
of the Originator's Underwriting Guidelines, or (iv) a detached one-family
dwelling in a planned unit development, none of which is a cooperative, mobile
or manufactured home.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc., or
its successors in interest.
Securities Act: The Securities Act of 1933, as amended.
Section 2. Purchase and Sale of the Mortgage Loans and Related Rights.
(a) Upon satisfaction of the conditions set forth in Section 10
hereof, the Seller agrees to sell, and the Purchaser agrees to purchase Mortgage
Loans having an aggregate Cut-off Date Balance of $2,375,911,775.
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(b) The closing for the purchase and sale of the Mortgage Loans and
the closing for the issuance of the Certificates will take place on the Closing
Date at the office of the Purchaser's counsel in New York, New York or such
other place as the parties shall agree.
(c) Upon the satisfaction of the conditions set forth in Section 10
hereof, on the Closing Date, in consideration of the purchase of the Mortgage
Loans, the Purchaser shall (i) pay to the Seller an amount equal to the net sale
proceeds of the Offered Certificates plus accrued interest in immediately
available funds by wire transfer to such account or accounts as shall be
designated by the Seller and (ii) deliver to the Seller the Class P and Class C
Certificates.
Section 3. Mortgage Loan Schedule.
The Seller agrees to provide to the Purchaser as of the Closing Date a
listing of the Mortgage Loans (the "Mortgage Loan Schedule") setting forth the
information listed on Exhibit 1 to this Agreement with respect to each of the
Mortgage Loans being sold by the Seller. The Mortgage Loan Schedule shall be
delivered to the Purchaser on the Closing Date, shall be attached to this
Agreement on the Closing Date by the parties hereto and shall be in form and
substance mutually agreed to by the Seller and the Purchaser.
Section 4. Mortgage Loan Transfer.
The Purchaser will be entitled to all scheduled payments of principal and
interest on the Mortgage Loans due after the Cut-off Date (regardless of when
actually collected) and all payments thereof other than scheduled principal and
interest received after the Cut-off Date. The Seller will be entitled to all
scheduled payments of principal and interest on the Mortgage Loans due on or
before the Cut-off Date (including payments collected after the Cut-off Date)
and all payments thereof other than scheduled principal and interest on the
Mortgage Loans received on or before the Cut-off Date. Such principal amounts
and any interest thereon belonging to the Seller as described above will not be
included in the aggregate outstanding principal balance of the Mortgage Loans as
of the Cut-off Date as set forth on the Mortgage Loan Schedule.
Pursuant to the Pooling and Servicing Agreement, the Purchaser will assign
on the Closing Date all of its right, title and interest in and to the Mortgage
Loans to the Trustee for the benefit of the Certificateholders. In connection
with the transfer and assignment of the Mortgage Loans, the Seller has delivered
or will deliver or cause to be delivered to the Trustee by the Closing Date the
following documents or instruments with respect to each Mortgage Loan (the
"Mortgage Loan Documents":
(A) The original Mortgage Note endorsed in blank or, "Pay to the order of
LaSalle Bank National Association, as trustee for the Xxxxxxx Xxxxx Mortgage
Investors Trust, Mortgage Loan Asset-Backed Certificates, Series 2006-FF1,
without recourse" together with all riders thereto. The Mortgage Note shall
include all intervening endorsements showing a complete chain of the title from
the originator of the Mortgage Loan to [____________________].
(B) Except as provided below and for each Mortgage Loan that is not a MERS
Loan, the original recorded Mortgage together with all riders thereto, with
evidence of recording thereon, or, if the original Mortgage has not yet been
returned from the recording office, a copy
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of the original Mortgage together with all riders thereto certified to be a true
copy of the original of the Mortgage that has been delivered for recording in
the appropriate recording office of the jurisdiction in which the Mortgaged
Property is located and in the case of each MERS Loan, the original Mortgage
together with all riders thereto, noting the presence of the MIN of the Loan and
either language indicating that the Mortgage Loan is a MOM Loan or if the
Mortgage Loan was not a MOM Loan at origination, the original Mortgage and the
assignment thereof to MERS, with evidence of recording indicated thereon, or a
copy of the Mortgage certified by the public recording office in which such
Mortgage has been recorded.
(C) In the case of each Mortgage Loan that is not a MERS Loan, the original
Assignment of each Mortgage in blank or, to "LaSalle Bank National Association,
as trustee for the Xxxxxxx Xxxxx Mortgage Investors Trust, Mortgage Loan
Asset-Backed Certificates, Series 2006-FF1."
(D) The original or a certified copy of the policy of title insurance (or a
preliminary title report, commitment or binder if the original title insurance
policy has not been received from the title insurance company).
(E) Originals of any intervening assignments of the Mortgage, with evidence
of recording thereon (if necessary to show the complete chain of title from the
originator of the Mortgage Loan to the mortgagee of record as of the Closing
Date) or, if the original intervening assignment has not yet been returned from
the recording office, a copy of such assignment certified to be a true copy of
the original of the assignment which has been sent for recording in the
appropriate jurisdiction in which the Mortgaged Property is located.
(F) Originals of all assumption and modification agreements, if any.
(G) If in connection with any Mortgage Loan, the Purchaser cannot deliver
the Mortgage, Assignments of Mortgage or assumption, consolidation or
modification, as the case may be, with evidence of recording thereon, if
applicable, concurrently with the execution and delivery of this Agreement
solely because of a delay caused by the public recording office where such
Mortgage, Assignments of Mortgage or assumption, consolidation or modification,
as the case may be, has been delivered for recordation, the Purchaser shall
deliver or cause to be delivered to the Trustee written notice stating that such
Mortgage or assumption, consolidation or modification, as the case may be, has
been delivered to the appropriate public recording office for recordation.
Thereafter, the Purchaser shall deliver or cause to be delivered to the Trustee
such Mortgage, Assignments of Mortgage or assumption, consolidation or
modification, as the case may be, with evidence of recording indicated thereon,
if applicable, upon receipt thereof from the public recording office. To the
extent any required endorsement is not contained on a Mortgage Note or an
Assignment of Mortgage, the Purchaser shall make or cause to be made such
endorsement.
The Seller and the Purchaser acknowledge hereunder that all of the Mortgage
Loans and the related servicing will ultimately be assigned to LaSalle Bank,
National Association, as Trustee for the Certificateholders, on the date hereof.
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Section 5. Examination of Mortgage Files.
(a) On or before the Closing Date, the Seller will have made the
Mortgage Files available to the Purchaser or its agent for examination which may
be at the offices of the Trustee or the Seller. The fact that the Purchaser or
its agent has conducted or has failed to conduct any partial or complete
examination of the Mortgage Files shall not affect the Purchaser's rights to
demand cure, repurchase, substitution or other relief as provided in this
Agreement. In furtherance of the foregoing, the Seller shall make the Mortgage
Files available to the Purchaser or its agent from time to time so as to permit
the Purchaser to confirm the Seller's compliance with the delivery and
recordation requirements of this Agreement and the Pooling and Servicing
Agreement. In addition, upon request of the Purchaser, the Seller agrees to
provide to the Purchaser, Xxxxxxx Xxxxx and to any investors or prospective
investors in the Certificates information regarding the Mortgage Loans and their
servicing, to make the Mortgage Files available to the Purchaser, Xxxxxxx Xxxxx
and to such investors or prospective investors (which may be at the offices of
the Seller and/or the Seller's custodian) and to make available personnel
knowledgeable about the Mortgage Loans for discussions with the Purchaser,
Xxxxxxx Xxxxx and such investors or prospective investors, upon reasonable
request during regular business hours, sufficient to permit the Purchaser,
Xxxxxxx Xxxxx and such investors or potential investors to conduct such due
diligence as any such party reasonably believes is appropriate.
(b) Except as set forth in the exception report delivered
contemporaneously herewith (the "Exception Report"), the Trustee acknowledges
receipt of the Mortgage Note for each Mortgage Loan and delivery of a Mortgage
File (but does not acknowledge receipt of all documents required to be included
in such Mortgage File) with respect to each Mortgage Loan and declares that it
holds and will hold such documents and any other documents constituting a part
of the Mortgage Files delivered to it in trust for the use and benefit of all
present and future Certificateholders. The Purchaser will cause the Seller to
repurchase any Mortgage Loan to which a material exception was taken in the
Exception Report unless such exception is cured to the satisfaction of the
Purchaser and the Trustee within 45 Business Days of the Closing Date.
(c) The Trustee agrees, for the benefit of the Purchaser and the
Certificateholders to review each Mortgage File delivered to it within sixty
(60) days after the Closing Date. The Trustee will ascertain and to certify,
within seventy (70) days of the Closing Date, to the Purchaser and the Servicer
that all documents required by Section 4 (A)-(B), (C) (if applicable), and
(D)-(E), and the documents if actually received by it, under Section 4 (F), have
been executed and received, and that such documents relate to the Mortgage Loans
that have been conveyed to it. It is herein acknowledged that, in conducting
such review, the Trustee shall not be under any duty or obligation to inspect,
review or examine any such documents, instruments, certificates or other papers
to determine that they are genuine, enforceable or appropriate for the
represented purpose, that they have actually been recorded or that they are
other than what they purport to be on their face. If the Trustee finds any
document or documents constituting a part of a Mortgage File to be missing or
defective (that is, mutilated, damaged, defaced or unexecuted) in any material
respect, the Trustee shall promptly (and in any event within no more than five
Business Days) after such finding so notify the Servicer, the Seller and the
Purchaser. In addition, the Trustee shall also notify the Servicer, the Seller
and the Purchaser if the original Mortgage with evidence of recording thereon
with respect to a Mortgage Loan is not received within seventy (70) days of the
Closing Date; if it has not been received because of
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a delay caused by the public recording office where such Mortgage has been
delivered for recordation, the Purchaser shall deliver or cause to be delivered
to the Trustee written notice stating that such Mortgage has been delivered to
the appropriate public recording office for recordation and thereafter the
Purchaser shall deliver or cause to be delivered such Mortgage with evidence of
recording thereon upon receipt thereof from the public recording office. The
Trustee shall request that the Seller correct or cure such omission, defect or
other irregularity, or substitute a Mortgage Loan pursuant to the provisions of
Section 5(c), within ninety (90) days from the date the Seller was notified of
such omission or defect and, if the Seller does not correct or cure such
omission or defect within such period, that the Seller purchase such Mortgage
Loan from the Issuing Entity within ninety (90) days from the date the Trustee
notified the Seller of such omission, defect or other irregularity at the
Purchase Price of such Mortgage Loan.
The Purchase Price for any Mortgage Loan purchased pursuant to this Section
5(c) shall be paid to the Servicer and deposited by the Servicer in the
Collection Account promptly upon receipt, and upon receipt by the Trustee of
written notification of such deposit signed by a Servicing Officer or receipt of
such deposit by the Trustee, the Trustee, upon receipt of a Request for Release
and certification of the Servicer of such required deposit, shall promptly
release to the Seller the related Mortgage File and the Trustee shall execute
and deliver such instruments of transfer or assignment, without recourse, as
shall be requested by the Seller and necessary to vest in the Seller or its
designee, as the case may be, any Mortgage Loan released pursuant hereto, and
the Trustee shall have no further responsibility with regard to such Mortgage
Loan. It is understood and agreed that the obligation of the Seller to purchase,
cure or substitute any Mortgage Loan as to which a material defect in or
omission of a constituent document exists shall constitute the sole remedy
respecting such defect or omission available to the Purchaser and the Trustee on
behalf of Certificateholders.
The Trustee shall be under no duty or obligation to inspect, review and
examine such documents, instruments, certificates or other papers to determine
that they are genuine, enforceable, recordable, duly authorized, sufficient,
legal, valid or appropriate to the represented purpose, or that they have
actually been recorded, or that they are other than what they purport to be on
their face. The Trustee shall keep confidential the name of each Mortgagor
except as required for the performance of this Agreement and the Trustee shall
not solicit any such Mortgagor for the purpose of refinancing the related
Mortgage Loan; notwithstanding anything herein to the contrary, the foregoing
shall not be construed to prohibit (i) disclosure of any and all information
that is or becomes publicly known, or information obtained by the Trustee from
sources other than the other parties hereto, (ii) disclosure of any and all
information (A) if required to do so by any applicable law, rule or regulation,
(B) to any government agency or regulatory body having or claiming authority to
regulate or oversee any aspects of the business of the Trustee or that of any
Affiliate, (C) pursuant to any subpoena, civil investigation demand or similar
demand or request of any court, regulatory authority, arbitrator or arbitration
to which the Trustee or any Affiliate or an officer, director, employer or
shareholder thereof is a party or (D) to any Affiliate, independent or internal
auditor, agent, employee or attorney of the Trustee having a need to know the
same, provided that the Trustee advises such recipient of the confidential
nature of the information being disclosed, or (iii) any other disclosure
authorized by the Purchaser.
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Within seventy (70) days of the Closing Date, the Trustee shall deliver to
the Purchaser and the Servicer the Trustee's Certification, substantially in the
form of Exhibit D to the Pooling and Servicing Agreement, evidencing the
completeness of the Mortgage Files, with any exceptions noted thereto.
Section 6. Sale Treatment.
(a) [Reserved.]
(b) It is the express intent of the parties hereto that the conveyance
of the Mortgage Loans by the Seller to the Purchaser, as contemplated by this
Agreement be, and be treated as, a sale. It is, further, not the intention of
the parties that such conveyance be deemed a pledge of the Mortgage Loans by the
Seller to the Purchaser to secure a debt or other obligation of the Seller.
However, in the event that, notwithstanding the intent of the parties, the
Mortgage Loans are held by a court of competent jurisdiction to continue to be
property of the Seller, then (i) this Agreement shall also be deemed to be a
security agreement within the meaning of Articles 8 and 9 of the applicable
Uniform Commercial Code; (ii) the transfer of the Mortgage Loans provided for
herein 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, to the extent the Purchaser would otherwise be entitled to own such
Mortgage Loans and proceeds pursuant to Section 4 hereof, including all amounts,
other than investment earnings, from time to time held or invested in any
accounts created pursuant to the Pooling and Servicing Agreement, whether in the
form of cash, instruments, securities or other property; (iii) the possession by
the Purchaser or the Trustee of Mortgage Notes and such other items of property
as constitute instruments, money, negotiable documents or chattel paper shall be
deemed to be "possession by the secured party" for purposes of perfecting the
security interest pursuant to Section 9-305 (or comparable provision) of the
applicable Uniform Commercial Code; and (iv) notifications to persons holding
such property, and acknowledgments, receipts or confirmations from persons
holding such property, shall be deemed notifications to, or acknowledgments,
receipts or confirmations from, financial intermediaries, bailees or agents (as
applicable) of the Purchaser for the purpose of perfecting such security
interest under applicable law. Any assignment of the interest of the Purchaser
pursuant to any provision hereof or pursuant to the Pooling and Servicing
Agreement shall also be deemed to be an assignment of any security interest
created hereby. The Seller and the Purchaser shall, to the extent consistent
with this Agreement, take such actions as may be reasonably necessary to ensure
that, if this Agreement were deemed to create a security interest in the
Mortgage Loans, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of the Pooling and Servicing Agreement.
Section 7. Representations and Warranties of Seller Concerning the Mortgage
Loans.
The Seller hereby represents and warrants to the Purchaser as of the
Closing Date or such other date as may be specified below with respect to each
Mortgage Loan being sold by it:
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(1) There are no defaults in complying with the terms of the Mortgage
as they relate to the holder thereof, and all taxes, governmental assessments,
insurance premiums, water, sewer and municipal charges, leasehold payments or
ground rents or other outstanding charges affecting the Mortgaged Property which
previously became due and owing have been paid, or escrow funds have been
established in an amount sufficient to pay for every such escrowed item which
remains unpaid and which has been assessed but is not yet due and payable. There
exist no deficiencies with respect to escrow deposits and payments, if escrows
are required, for which customary arrangements for repayment thereof have not
been made, and other than in connection with a modification or work-out
agreement contained in the Mortgage File, no escrow deficits or payments of
other charges or payments have been capitalized under the Mortgage or the
applicable Mortgage Note;
(2) The Seller has not, and to the Seller's knowledge, neither the
Servicer nor any prior holder of any Mortgage Loan has waived, altered or
modified the Mortgage or Mortgage Note (except that a Mortgage Loan may have
been modified by a written instrument (a copy of which is in the Mortgage File
and the terms of which are reflected on the Mortgage Loan Schedule) which has
been recorded or is in the process of being recorded, if necessary to protect
the validity and first priority lien of the owner of such Mortgage Loan; the
substance of any such waiver, alteration or modification has been approved by
the issuer of any title insurance policy, to the extent required by the related
policies); satisfied, canceled, rescinded or subordinated such Mortgage in whole
or in part; released the applicable Mortgaged Property in whole or in part from
the lien of such Mortgage; or executed any instrument of cancellation,
rescission or satisfaction with respect thereto. No instrument of release or
waiver has been executed in connection with any Mortgage Loan, and no Mortgagor
has been released, in whole or in part from its obligations in connection with a
Mortgage Loan;
(3) The Mortgage Note and the Mortgage are not subject to any valid
right of rescission, set-off, counterclaim or defense, including the defense of
usury, 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 (subject to bankruptcy, insolvency, moratorium, reorganization and
similar laws or by equitable principles affecting the enforceability of the
rights of creditors, including those respecting the availability of specific
performance), in whole or in part, and to the Seller's knowledge no such right
of rescission, set-off, counterclaim or defense has been asserted with respect
thereto;
(4) All buildings upon the Mortgaged Property are insured by a
generally acceptable insurer in accordance with Originator's Underwriting
Guidelines against loss by fire, hazards of extended coverage and such other
hazards as are customary in the area where the Mortgaged Property is located.
All such insurance policies contain a standard mortgagee clause naming the
Originator, its successors and assigns as mortgagee and all premiums thereon
have been paid or escrowed funds have been established in an amount sufficient
to pay the premium. If the Mortgaged Property is in an area identified on a
Flood Hazard Map or Flood Insurance Rate Map issued by the Federal Emergency
Management Agency as having special flood hazards (and such flood insurance has
been made available) a flood insurance policy meeting the requirements of the
current guidelines of the Federal Insurance Administration is in effect which
policy conforms to the Originator's Underwriting Guidelines. The Mortgage
obligates the Mortgagor thereunder to maintain all such insurance at the
Mortgagor's cost and expense, and on
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the Mortgagor's failure to do so, authorizes the holder of the Mortgage to
maintain such insurance at Mortgagor's cost and expense and to seek
reimbursement therefor from the Mortgagor;
(5) Any and all requirements of any applicable federal, state or local
law including, without limitation, laws governing prepayment penalties, usury,
truth in lending, real estate settlement procedures, consumer credit protection,
equal credit opportunity, fair housing and disclosure laws applicable to the
origination and servicing of mortgage loans of a type similar to the Mortgage
Loans have been complied with and the consummation of the transactions
contemplated hereby will not involve the violation of any such applicable laws;
(6) 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 satisfaction, cancellation, subordination,
rescission or release;
(7) The related Mortgage is properly recorded and is a valid, existing
and enforceable first lien and first priority security interest with respect to
each Mortgage Loan on the Mortgaged Property, including all improvements on the
Mortgaged Property subject only to (a) the lien of current real property taxes
and assessments not yet due and payable, (b) covenants, conditions and
restrictions, rights of way, easements and other matters of the public record as
of the Origination Date being acceptable to mortgage lending institutions
generally and referred to in the lender's title insurance policy delivered to
the Originator and which do not adversely affect the Appraised Value of the
Mortgaged Property and (c) 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, existing and enforceable first
lien and first priority security interest with respect to each Mortgage Loan and
the Seller has full right to sell and assign the same to the 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, except as
otherwise set forth in the Mortgage Loan Schedule;
(8) Each Mortgage Note and the related Mortgage are genuine and each
is the legal, valid and binding obligations of the maker thereof, enforceable in
accordance with their terms subject to bankruptcy, insolvency, moratorium,
receivership, conservatorship, reorganization and similar laws on or hereafter
in effect of general application affecting creditors' rights generally and
subject to the application of the general principles of equity, including those
respecting the availability of specific performance (regardless of whether such
enforcement is considered in a proceeding in equity or at law);
(9) All parties to the Mortgage Note and the Mortgage had legal
capacity to enter into the Mortgage Loan and to execute and deliver the Mortgage
Note and the Mortgage, and the Mortgage Note and the Mortgage have been duly and
properly executed by such parties. The Mortgagor is a natural person, the
identity of such natural person was verified to the extent
-11-
required by the Originator's Underwriting Guidelines and, to the Seller's
knowledge, such Mortgagor is not in violation of any laws regarding identity
theft;
(10) All Persons that have had any interest in the Mortgage Loan,
whether as originator, mortgagee, assignee, pledgee (other than with respect to
a Federal Home Loan Bank pledgee) or otherwise, are (or, during the period in
which they held and disposed of such interest, were): (A) organized under the
laws of such state, or (B) qualified to do business in such state, or (C)
federal savings and loan associations, national banks or national bank operating
subsidiaries or (D) not doing business in such state so as to require
qualification or licensing, or (E) not otherwise required to be licensed in such
state under laws applicable to such Person. All parties which have had any
interest in the Mortgage Loan (other than with respect to a Federal Home Loan
Bank pledgee) were in compliance with any and all "doing business" and licensing
requirements of the laws of the state wherein the Mortgaged Property is located
applicable to such Person or were not required under the laws applicable to such
Person to be licensed in such state;
(11) The Mortgage Loan is covered by an ALTA lender's title insurance
policy (which, in the case of an Adjustable Rate Mortgage Loan has an adjustable
rate mortgage endorsement in the form of ALTA 6.0 or 6.1) or equivalent form of
policy of insurance acceptable to lenders who originate or originated mortgage
loans similar to the Mortgage Loans as of the related Origination Date of the
Mortgage Loan and issued by a title insurer acceptable to prudent mortgage
lenders and qualified to do business in the jurisdiction where the Mortgaged
Property is located, insuring (subject to the exceptions contained above in
10(a) and (b) the Seller or the Originator and their successors and assigns as
to the first priority lien of the Mortgage in the original principal amount of
the Mortgage Loan and, with respect to any Adjustable Rate Mortgage Loan,
against any loss by reason of the invalidity or unenforceability of the lien
resulting from the provisions of the Mortgage providing for adjustment in the
Mortgage Interest Rate and Monthly Payment. The Seller or the Originator is the
sole insured of such lender's title insurance policy, and such lender's title
insurance policy is in full force and effect and will be in full force and
effect upon the consummation of the transactions contemplated by this Agreement.
No claims have been made under such lender's title insurance policy, and no
prior holder 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;
(12) There is no default, breach, violation or event of acceleration
existing under the Mortgage or the Mortgage Note (except for necessary escrows
established as a result of forced placement in accordance with Accepted
Servicing Practices and modifications permitted by Accepted Servicing Practices)
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 of acceleration, and no such default, breach, violation or event of
acceleration has been waived;
(13) To the Seller's knowledge, there are no mechanics' liens or
similar liens or claims for work, labor or material affecting any Mortgaged
Property which have been filed (and no rights are outstanding that under law
could give rise to such liens), which are or may be a lien prior to, or equal
with, the lien of such Mortgage, except those which are insured against by the
title insurance policy with respect to the Mortgage Loan;
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(14) All improvements which were considered in determining the
Appraised Value of the related Mortgaged Property lay wholly within the
boundaries and building restriction lines of the Mortgaged Property, and to the
Seller's knowledge, no improvements on adjoining properties encroach upon the
Mortgaged Property;
(15) The Mortgage Loan bears interest at the Mortgage Interest Rate.
With respect to each Mortgage Loan other than a Mortgage Loan with an interest
only payment period, the Mortgage Note is payable on the first day of each month
in Monthly Payments, which, (A) in the case of a Fixed Rate Mortgage Loan, are
sufficient to fully amortize the original principal balance over the original
term thereof and to pay interest at the related Mortgage Interest Rate, (B) in
the case of an Adjustable Rate Mortgage Loan, are changed on each Adjustment
Date, and in any case, are sufficient to fully amortize the original principal
balance over the original term thereof and to pay interest at the related
Mortgage Interest Rate and (C) in the case of a Balloon Loan, are based on a
twenty (20) or thirty (30) year amortization schedule, as set forth in the
related Mortgage Note, and a final monthly payment substantially greater than
the preceding monthly payment which is sufficient to amortize the remaining
principal balance of the Balloon Loan and to pay interest at the related
Mortgage Interest Rate. The Index for each Adjustable Rate Mortgage Loan is as
defined in the related Mortgage Loan Schedule;
(16) The origination practices used by the Originator and the
collection practices used by the Servicer with respect to each Mortgage Note and
Mortgage have been in all respects legal, proper, prudent and customary in the
mortgage origination and servicing industry for mortgage loans similar to the
Mortgage Loans. The Mortgage Loan has been serviced by the Servicer and any
predecessor servicer in accordance with the terms of the Mortgage Note.;
(17) The Mortgaged Property is free of damage and waste and there is
no proceeding pending or to the Seller's knowledge, threatened for the total or
partial condemnation thereof nor is such a proceeding currently occurring;
(18) The Mortgage and related Mortgage Note contain 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, (a) in the case of a
Mortgage designated as a deed of trust, by trustee's sale, and (b) otherwise by
judicial foreclosure. The Mortgaged Property is not subject to any bankruptcy
proceeding (or with respect to each Mortgage Loan for which the proceeds were
used to pay off a bankruptcy of the borrower, the related Mortgaged Property is
no longer subject to any bankruptcy proceeding) or foreclosure proceeding, nor
are any such proceedings pending and the Mortgagor has not filed for protection
under applicable bankruptcy laws;
(19) The Mortgage Loan was underwritten in accordance with the
Originator's Underwriting Guidelines; and the Mortgage Note and Mortgage
(exclusive of any riders or addenda) are on forms acceptable to FNMA or FHLMC
and the riders and addenda are on forms customary for use in the secondary
market with respect to mortgage loans similar to the Mortgage Loans;
(20) The related Mortgage File contains an appraisal of the Mortgaged
Property signed by a Qualified Appraiser or evidence of an Appraised Value. Any
written appraisal
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performed by a Qualified Appraiser is in a form permitted by the Originator's
Underwriting Guidelines;
(21) In the event the Mortgage constitutes 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 the 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;
(22) No Mortgage Loan contains provisions pursuant to which Monthly
Payments are (a) paid or partially paid with funds deposited in any separate
account established by the Seller, the Servicer, the Mortgagor, or anyone on
behalf of the Mortgagor, (b) paid by any source other than the Mortgagor or (c)
contains 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;
(23) To the Seller's knowledge, there are no circumstances or
condition with respect to the Mortgage, the Mortgaged Property, the Mortgagor or
the Mortgagor's credit standing that can reasonably be expected to cause the
Mortgage Loan to become delinquent, or adversely affect the value of the
Mortgage Loan;
(24) To the Seller's knowledge, the Mortgaged Property is lawfully
occupied under applicable law; as of the Origination 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. To the Seller's knowledge, no improvement located on or
being part of any Mortgaged Property is in violation of any applicable zoning
law or regulation;
(25) Each original Mortgage was recorded and all subsequent
assignments of the original Mortgage (other than any intervening transfer to the
Purchaser) have been recorded, or are in the process of being recorded, in the
appropriate jurisdictions wherein such recordation is necessary to perfect the
lien thereof as against creditors of the Mortgagor. The Assignment of Mortgage
is in recordable form and is acceptable for recording under the laws of the
jurisdiction in which the Mortgaged Property is located;
(26) Any principal advances made to the Mortgagor 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. The lien of the Mortgage securing the
consolidated principal amount is expressly insured as having first lien priority
with respect to each Mortgage Loan by a title insurance policy, an endorsement
to the policy insuring the mortgagee's consolidated interest or by other title
evidence acceptable for use in the secondary market with respect to mortgage
loans similar to the Mortgage Loans. The consolidated principal amount does not
exceed the original principal amount of the Mortgage Loan;
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(27) The Mortgaged Property is in material compliance with all
applicable environmental laws pertaining to environmental hazards including,
without limitation, asbestos, and neither the Seller, the Servicer nor, to the
Seller's knowledge, the related Mortgagor, has received any notice of any
violation or potential violation of such law;
(28) No selection procedures were used by the Seller to select those
mortgage loans originally offered for sale by the Seller to the Purchaser
(including the Mortgage Loans) that identified such mortgage loans as being less
desirable or valuable than comparable mortgage loans otherwise being offered for
sale by the Seller;
(29) Each Mortgage Loan is a "qualified mortgage" within the meaning
of Section 860G of the Code (as determined without regard to Treas. Reg. Section
1.860G-2(a)(3) or any similar rule that treats a defective obligation as a
qualified mortgage for a temporary period);
(30) No Mortgage Loan provides for interest other than at either (i) a
single fixed rate in effect throughout the term of the Mortgage Loan or (ii) a
"variable rate" (within the meaning of Treas. Reg. Section 1.860G-1(a)(3)) in
effect throughout the term of the Mortgage Loan;
(31) The Seller would not, based on the delinquency status of the
Mortgage Loans, institute foreclosure proceedings with respect to any of the
Mortgage Loans prior to the next scheduled payment for such Mortgage Loan;
(32) No Mortgage Loan is in foreclosure;
(33) The Mortgage Loan Documents with respect to each Mortgage Loan
subject to Prepayment Charges specifically authorizes such Prepayment Charges to
be collected and such Prepayment Charges are permissible and enforceable in
accordance with the terms of the related Mortgage Loan Documents and applicable
law;
(34) The Mortgage contains a 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 at the option of the mortgagee and such provision is
enforceable (unless the transfer is permitted by applicable federal law without
the consent of the mortgagee thereunder);
(35) No predatory or deceptive lending practices, as defined by
applicable federal, state or local law applicable to the originator of the
Mortgage Loan in effect on the Origination Date of the Mortgage Loan, including
but not limited to, the extension of credit to the mortgagor without regard for
the mortgagor's ability to repay the Mortgage Loan and the extension of credit
to the mortgagor which has no apparent benefit to the mortgagor, were employed
by the originator of the Mortgage Loan, or any affiliate of the originator of
the Mortgage Loan, in connection with the origination of the Mortgage Loan;
(36) To the extent in effect on the Origination Date of the Mortgage
Loan, no Mortgage Loan is a "High-Cost Home Loan" as defined in New York Banking
Law 6-1; no Mortgage Loan is a "High-Cost Home Loan" as defined in the Arkansas
Home Loan Protection
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Act effective July 16, 2003 (Act 1340 of 2003); no Mortgage Loan is a "High-Cost
Home Loan" as defined in the Kentucky high-cost home loan statute effective June
24, 2003 (Ky. Rev. Stat. Section 360.100); no Mortgage Loan is a "home loan" as
defined by Nevada Revised Statute Section 598D.040; no Mortgage Loan is a
"high-rate, high-fee mortgage" as defined by Maine Revised Statute, Title 9-A,
Section 8-103; no Mortgage Loan is a "High-Cost Home Loan" as defined in the New
Jersey Home Ownership Act effective November 27, 2003 (N.J.S.A. 46:10B-22 et
seq.); no Mortgage Loan is a "High-Cost Home Loan" as defined in the New Mexico
Home Loan Protection Act effective January 1, 2004 (N.M. Stat. Xxx. Xxxxxxx
00-00X-0 et seq.); no Mortgage Loan is a "High-Risk Home Loan" as defined in the
Illinois High-Risk Home Loan Act effective January 1, 2004 (815 Ill. Comp. Stat.
137/1 et seq.); no Mortgage Loan is a "High-Cost Home Mortgage Loan" as defined
in the Massachusetts Predatory Home Loan Practices Act, effective November 6,
2004 (Mass. Xxx. Laws Ch. 183C); no Mortgage Loan is a "High Cost Home Loan" as
defined in the Indiana Home Loan Practices Act, effective January 1, 2005 (Ind.
Code Xxx. Sections 24-9-1 through 24-9-9);
(37) No Mortgage Loan is a balloon mortgage loan that has an original
stated maturity of less than seven (7) years;
(38) The related 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 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;
(39) The methodology used in underwriting the extension of credit for
the Mortgage Loan employs 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 Origination Date
the Mortgagor had a reasonable ability to make timely payments on the Mortgage
Loan;
(40) With respect to any Mortgage Loan that contains a provision
permitting imposition of a Prepayment Charge prior to maturity: (i) the Mortgage
Loan's originator has a written policy that provides that all its mortgage loans
are available with or without Prepayment Charges, (ii) prior to the Mortgage
Loan's origination, the Mortgage Loan originator's rate sheets relating to the
Mortgage Loan priced the Mortgage Loan with or without Prepayment Charges, and
thereby provided a means for the borrower to agree to such Prepayment Charge in
exchange for a monetary benefit, including but not limited to a rate or fee
reduction, (iii) to the Seller's knowledge, 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 Prepayment Charge, (iv) the Prepayment
Charge is disclosed to the Mortgagor in the Mortgage Loan Documents pursuant to
applicable state and federal law and (v) notwithstanding any state or federal
law to the contrary, the Servicer shall not impose such Prepayment Charge in any
instance when the mortgage debt is accelerated as the result of the Mortgagor's
default in making the loan payments;
-16-
(41) The related Mortgagor was not required to purchase any single
premium credit insurance policy (e.g., life, mortgage, disability, 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,
accident, unemployment, or health insurance product) or debt cancellation
agreement in connection with the origination of the Mortgage Loan. No proceeds
from the Mortgage Loan were used to purchase single premium credit insurance
policies (e.g., life, mortgage, disability, accident, unemployment, or health
insurance product) or debt cancellation agreements as part of the origination
of, or as a condition to closing, such Mortgage Loan;
(42) All points and fees related to each Mortgage Loan were disclosed
in writing to the Mortgagor in accordance with applicable state and federal law
and regulation. From and after November 1, 2004, no Mortgage Loan included
financed "points and fees" as defined and described in the Originator's
Underwriting Guidelines in effect as of the Origination Date of the Mortgage
Loan in an amount greater than five 5%, calculated in accordance with
Originator's Underwriting Guidelines in effect on the Origination Date of such
Mortgage Loan;
(43) 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 the Mortgage Loan has been disclosed in writing to
the Mortgagor in accordance with applicable state and federal law and
regulation;
(44) As of the Origination Date, no Mortgage Loan was, or currently
is, covered by the Home Ownership and Equity Protection Act of 1994 ("HOEPA"),
no Mortgage Loan is subject to the requirements of HOEPA, no refinance or
purchase money Mortgage Loan has an "annual percentage rate" or "total points
and fees" payable by the borrower (as each such term is defined under HOEPA)
that equal or exceed the thresholds defined under HOEPA (Section 32 of
Regulation Z, 12 C.F.R. Section 226.32(a)(1)(i) and (ii)) and no Mortgage Loan
is in violation of any comparable state or local law;
(45) No Mortgage Loan originated (or modified) on or after October 1,
2002 and before March 7, 2003 is secured by property located in the State of
Georgia. No Mortgage Loan originated on or after March 7, 2003 is a "High-Cost
Home Loan" as defined under the Georgia Fair Lending Act;
(46) No Mortgage Loan is classified as a high cost mortgage loan under
HOEPA, and 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, additional legal liability for
residential mortgage loans having high interest rates, points and/or fees or
providing for liability to the purchaser or assignee of such Mortgage Loan);
(47) No Mortgage Loan requires the Mortgagor to submit to arbitration
to resolve any dispute arising out of or relating in any way to the Mortgage
Loan transaction;
-17-
(48) Each Mortgage Loan and related Prepayment Charge at the time it
was made complied in all material respects with applicable local, state and
federal laws, including, without limitation, usury, equal credit opportunity,
real estate settlement procedures, predatory, abusive and fair lending laws,
truth-in-lending and disclosure laws, and the consummation of the transactions
completed hereby will not involve the violation of any such laws;
(49) No Mortgage Loan is a "High Cost Loan" or "Covered Loan", as
applicable (as such terms are defined in the then-current Standard & Poor's
LEVELS(R) Glossary, which is set out as Exhibit 5 hereto);
(50) With respect to each Mortgage Loan, the FICO score provided is
not a NextGen FICO score; and
(51) No litigation is pending or, to the Seller's knowledge,
threatened with respect to the Mortgage Loan or Mortgaged Property.
Upon discovery by any of the Purchaser, the Servicer or the Trustee (or its
custodian) of a breach of any of such representations and warranties that
adversely and materially affects the value of the related Mortgage Loan,
Prepayment Charges or the interests of the Certificateholders, the party
discovering such breach shall give prompt written notice to the other parties.
Within ninety (90) days of the discovery of such breach of any representation or
warranty, the Seller shall either (a) cure such breach in all material respects,
(b) repurchase such Mortgage Loan or any property acquired in respect thereof
from the Trustee at the Purchase Price or (c) within the two year period
following the Closing Date, substitute a Replacement Mortgage Loan for the
affected Mortgage Loan. In the event of discovery of a breach of any
representation and warranty of the Seller, the Trustee's rights shall be
enforced under this Agreement for the benefit of Certificateholders. In the
event that such breach relates solely to the unenforceability of a Prepayment
Charge, amounts received in respect of such indemnity up to the amount of such
Prepayment Charge shall be distributed pursuant to Section 4.04(b)(i) of the
Pooling and Servicing Agreement. If the Seller substitutes for a Mortgage Loan
for which there is a breach of any representations and warranties in this
Agreement which adversely and materially affects the value of such Mortgage Loan
and such substitute mortgage loan is not a Replacement Mortgage Loan, the Seller
will, in exchange for such substitute Mortgage Loan, (i) provide the applicable
Purchase Price for the affected Mortgage Loan or (ii) within two years of the
Closing Date, substitute such affected Mortgage Loan with a Replacement Mortgage
Loan. Any such substitution shall not be effected prior to the additional
delivery to the Trustee of a Request for Release substantially in the form of
Exhibit I to the Pooling and Servicing Agreement and shall not be effected
unless it is within two years of the Startup Day. With respect to the
representations and warranties described in this Section that are made to the
best of the Seller's knowledge, if it is discovered by any of the Purchaser, the
Seller or the Trustee that the substance of such representation and warranty is
inaccurate and such inaccuracy materially and adversely affects the value of the
related Mortgage Loan, notwithstanding the Seller's lack of knowledge with
respect to the substance of such representation or warranty, such inaccuracy
shall be deemed a breach of the applicable representation or warranty.
The Seller indemnifies and holds the Issuing Entity, the Trustee (or its
custodian, as applicable), the Purchaser, the Servicer and each
Certificateholder harmless against any and all
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taxes, claims, losses, penalties, fines, forfeitures, reasonable legal fees and
related costs, judgments, and any other costs, fees and expenses that the
Issuing Entity, the Trustee (or its custodian, as applicable), the Purchaser,
the Servicer and any Certificateholder may sustain in connection with any
actions of the Seller relating to a repurchase of a Mortgage Loan other than in
compliance with the terms of this Section 7, to the extent that any such action
causes (i) any federal or state tax to be imposed on the Issuing Entity or any
REMIC provided for in the Pooling and Servicing Agreement, including without
limitation, any federal tax imposed on "prohibited transactions" under Section
860F(a)(1) of the Code or on "contributions after the startup day" under Section
860G(d)(1) of the Code, or (ii) any REMIC created in the Pooling and Servicing
Agreement to fail to qualify as a REMIC at any time that any Certificate is
outstanding. In furtherance of the foregoing, if the Seller is not a member of
MERS and repurchases a Mortgage Loan which is registered on the MERS System, the
Seller, at its own expense and without any right of reimbursement, shall cause
MERS to execute and deliver an assignment of the Mortgage in recordable form to
transfer the Mortgage from MERS to the Seller and shall cause such Mortgage to
be removed from registration on the MERS System in accordance with MERS' rules
and regulations.
With respect to any Mortgage Loan repurchased by the Seller hereunder, the
principal portion of the funds received by the Servicer in respect of such
repurchase of a Mortgage Loan will be considered a Principal Prepayment and
shall be deposited in the Certificate Account pursuant to Section 3.05 of the
Pooling and Servicing Agreement. Upon receipt by the Trustee of notice from the
Servicer of receipt by the Servicer of the full amount of the Purchase Price for
a Deleted Mortgage Loan, and upon receipt by the Trustee of the Mortgage File
for a Replacement Mortgage Loan substituted for a Deleted Mortgage Loan and a
Request for Release, the Trustee shall release and reassign to the Seller the
related Mortgage File for the Deleted Mortgage Loan and shall execute and
deliver such instruments of transfer or assignment, in each case without
recourse, representation or warranty, as shall be necessary to vest in such
party or its designee or assignee title to any Deleted Mortgage Loan released
pursuant hereto, free and clear of all security interests, liens and other
encumbrances created by this Agreement, which instruments shall be prepared by
the Purchaser or the Seller, and the Trustee (and its custodian) shall have no
further responsibility with respect to the Mortgage File relating to such
Deleted Mortgage Loan.
With respect to each Replacement Mortgage Loan to be delivered to the
Trustee pursuant to the terms of this Section 7 in exchange for a Deleted
Mortgage Loan: (i) the Seller must deliver to the Trustee the Mortgage File for
the Replacement Mortgage Loan along with a written certification certifying as
to the Mortgage Loan satisfying all requirements under the definition of
Replacement Mortgage Loan and the delivery of such Mortgage File and containing
the granting language set forth in Section 4; and (ii) the Purchaser will be
deemed to have made, with respect to such Replacement Mortgage Loan, each of the
representations and warranties made by it with respect to the related Deleted
Mortgage Loan. The Trustee shall review the Mortgage File with respect to each
Replacement Mortgage Loan and certify to the Purchaser that all documents
required by Section 4(A)-(B), (C) (if applicable), and (D)-(E) have been
executed and received.
For any month in which the Seller substitutes one or more Replacement
Mortgage Loans for one or more Deleted Mortgage Loans, the Seller will determine
the amount (if any) by which
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the aggregate principal balance of all such Replacement Mortgage Loans as of the
date of substitution and the aggregate Prepayment Charges with respect to such
Replacement Mortgage Loans is less than the aggregate Stated Principal Balance
(after application of the principal portion of the Monthly Payment due in the
month of substitution) and aggregate Prepayment Charges of all such Deleted
Mortgage Loans. An amount equal to the aggregate of the deficiencies described
in the preceding sentence (such amount, the "Substitution Adjustment Amount")
plus an amount equal to any unreimbursed costs, penalties and/or damages
incurred by the Issuing Entity in connection with any violation relating to such
Deleted Mortgage Loan of any predatory or abusive lending law shall be remitted
by the Seller to the Trustee for deposit into the Certificate Account by the
Seller on the Determination Date for the Distribution Date relating to the
Prepayment Period during which the related Mortgage Loan became required to be
purchased or replaced hereunder.
Notwithstanding any other provision of this Agreement, the right to
substitute Mortgage Loans pursuant to this Section 7 shall be subject to the
additional limitations that no substitution of a Replacement Mortgage Loan for a
Deleted Mortgage Loan shall be made unless the Trustee shall have received an
Opinion of Counsel (at the expense of the party seeking to make the
substitution) that, under current law, such substitution will not (A) affect
adversely the status of any REMIC established pursuant to the Pooling and
Servicing Agreement as a REMIC, or of the related "regular interests" as
"regular interests" in any such REMIC, or (B) cause any such REMIC to engage in
a "prohibited transaction" or prohibited contribution pursuant to the REMIC
Provisions.
The Purchaser shall amend the Mortgage Loan Schedule to reflect the removal
of such Deleted Mortgage Loan from the terms of this Agreement and the
substitution of the Replacement Mortgage Loan or Replacement Mortgage Loans.
Upon such substitution by the Seller, such Replacement Mortgage Loan or
Replacement Mortgage Loans shall constitute part of the Mortgage Pool and shall
be subject in all respects to the terms of this Agreement, including all
applicable representations and warranties thereof included herein as of the date
of substitution.
It is understood and agreed that the representations, warranties and
indemnification set forth in this Section 7 of the Seller hereunder shall each
survive delivery of the Mortgage Files and the Assignment of Mortgage of each
Mortgage Loan to the Trustee and shall continue throughout the term of this
Agreement.
Section 8. Representations and Warranties Concerning the Seller.
As of the date hereof and as of the Closing Date, the Seller represents and
warrants to the Purchaser as to itself in the capacity indicated as follows:
(a) the Seller (i) is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and (ii) is
qualified and in good standing to do business in each jurisdiction where such
qualification is necessary, except where the failure so to qualify would not
reasonably be expected to have a material adverse effect on the Seller's
business as presently conducted or on the Seller's ability to enter into this
Agreement and to consummate the transactions contemplated hereby;
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(b) the Seller has full power to own its property, to carry on its
business as presently conducted and to enter into and perform its obligations
under this Agreement;
(c) the execution and delivery by the Seller of this Agreement have
been duly authorized by all necessary action on the part of the Seller; and
neither the execution and delivery of this Agreement, nor the consummation of
the transactions herein contemplated, nor compliance with the provisions hereof,
will conflict with or result in a breach of, or constitute a default under, any
of the provisions of any law, governmental rule, regulation, judgment, decree or
order binding on the Seller or its properties or the charter or by-laws of the
Seller, except those conflicts, breaches or defaults which would not reasonably
be expected to have a material adverse effect on the Seller's ability to enter
into this Agreement and to consummate the transactions contemplated hereby;
(d) the execution, delivery and performance by the Seller of this
Agreement and the consummation of the transactions contemplated hereby do not
require the consent or approval of, the giving of notice to, the registration
with, or the taking of any other action in respect of, any state, federal or
other governmental authority or agency, except those consents, approvals,
notices, registrations or other actions as have already been obtained, given or
made and, in connection with the recordation of the Mortgages, powers of
attorney or assignments of Mortgages not yet completed;
(e) this Agreement has been duly executed and delivered by the Seller
and, assuming due authorization, execution and delivery by the Purchaser,
constitutes a valid and binding obligation of the Seller enforceable against it
in accordance with its terms (subject to applicable bankruptcy and insolvency
laws and other similar laws affecting the enforcement of the rights of creditors
generally);
(f) there are no actions, suits or proceedings pending or, to the
knowledge of the Seller, threatened against the Seller, before or by any court,
administrative agency, arbitrator or governmental body (i) with respect to any
of the transactions contemplated by this Agreement or (ii) with respect to any
other matter which in the judgment of the Seller will be determined adversely to
the Seller and will if determined adversely to the Seller materially and
adversely affect the Seller's ability to perform its obligations under this
Agreement; and the Seller is not in default with respect to any order of any
court, administrative agency, arbitrator or governmental body so as to
materially and adversely affect the transactions contemplated by this Agreement;
and
(g) the Seller's Information (as defined in Section 13(a) hereof) does
not include any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading.
Section 9. Representations and Warranties Concerning the Purchaser.
As of the date hereof and as of the Closing Date, the Purchaser represents
and warrants to the Seller as follows:
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(a) the Purchaser (i) is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and (ii)
is qualified and in good standing as a foreign corporation to do business in
each jurisdiction where such qualification is necessary, except where the
failure so to qualify would not reasonably be expected to have a material
adverse effect on the Purchaser's business as presently conducted or on the
Purchaser's ability to enter into this Agreement and to consummate the
transactions contemplated hereby;
(b) the Purchaser has full corporate power to own its property, to
carry on its business as presently conducted and to enter into and perform its
obligations under this Agreement;
(c) the execution and delivery by the Purchaser of this Agreement have
been duly authorized by all necessary corporate action on the part of the
Purchaser; and neither the execution and delivery of this Agreement, nor the
consummation of the transactions herein contemplated, nor compliance with the
provisions hereof, will conflict with or result in a breach of, or constitute a
default under, any of the provisions of any law, governmental rule, regulation,
judgment, decree or order binding on the Purchaser or its properties or the
articles of incorporation or by-laws of the Purchaser, except those conflicts,
breaches or defaults which would not reasonably be expected to have a material
adverse effect on the Purchaser's ability to enter into this Agreement and to
consummate the transactions contemplated hereby;
(d) the execution, delivery and performance by the Purchaser of this
Agreement and the consummation of the transactions contemplated hereby do not
require the consent or approval of, the giving of notice to, the registration
with, or the taking of any other action in respect of, any state, federal or
other governmental authority or agency, except those consents, approvals,
notices, registrations or other actions as have already been obtained, given or
made;
(e) this Agreement has been duly executed and delivered by the
Purchaser and, assuming due authorization, execution and delivery by the Seller,
constitutes a valid and binding obligation of the Purchaser enforceable against
it in accordance with its terms (subject to applicable bankruptcy and insolvency
laws and other similar laws affecting the enforcement of the rights of creditors
generally);
(f) there are no actions, suits or proceedings pending or, to the
knowledge of the Purchaser, threatened against the Purchaser, before or by any
court, administrative agency, arbitrator or governmental body (i) with respect
to any of the transactions contemplated by this Agreement or (ii) with respect
to any other matter which in the judgment of the Purchaser will be determined
adversely to the Purchaser and will if determined adversely to the Purchaser
materially and adversely affect the Purchaser's ability to perform its
obligations under this Agreement; and the Purchaser is not in default with
respect to any order of any court, administrative agency, arbitrator or
governmental body so as to materially and adversely affect the transactions
contemplated by this Agreement; and
(g) the Purchaser's Information (as defined in Section 13(b) hereof)
does not include any untrue statement of a material fact or omit to state a
material fact necessary in order
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to make the statements made, in light of the circumstances under which they were
made, not misleading.
Section 10. Conditions to Closing.
(a) The obligations of the Purchaser under this Agreement will be
subject to the satisfaction, on or prior to the Closing Date, of the following
conditions:
(i) Each of the obligations of the Seller required to be performed at
or prior to the Closing Date pursuant to the terms of this Agreement shall
have been duly performed and complied with in all material respects; all of
the representations and warranties of the Seller under this Agreement shall
be true and correct as of the date or dates specified in all material
respects; and no event shall have occurred which, with notice or the
passage of time, would constitute a default under this Agreement, or the
Pooling and Servicing Agreement; and the Purchaser shall have received
certificates to that effect signed by authorized officers of the Seller.
(ii) The Purchaser shall have received all of the following closing
documents, in such forms as are agreed upon and reasonably acceptable to
the Purchaser, duly executed by all signatories other than the Purchaser as
required pursuant to the respective terms thereof:
(A) [Reserved];
(B) If required pursuant to Section 3 hereof, the Mortgage Loan
Schedule containing the information set forth on Exhibit 1 hereto;
(C) The Pooling and Servicing Agreement, in form and substance
reasonably satisfactory to the Trustee and the Purchaser, and all
documents required thereby duly executed by all signatories;
(D) A certificate of an officer of the Seller dated as of the
Closing Date, in a form reasonably acceptable to the Purchaser, and
attached thereto the resolutions of the Seller's authorizing the
transactions contemplated by this Agreement, together with copies of
the charter and by-laws of the Seller;
(E) One or more opinions of counsel from the Seller's counsel
otherwise in form and substance reasonably satisfactory to the
Purchaser, the Trustee and each Rating Agency;
(F) A letter from each of the Rating Agencies giving each Class
of Certificates set forth on Schedule B the rating set forth on
Schedule B; and
(G) Such other documents, certificates (including additional
representations and warranties) and opinions as may be reasonably
necessary to secure the intended ratings from each Rating Agency for
the Certificates.
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(iii) The Certificates to be sold to Xxxxxxx Xxxxx pursuant to the
Underwriting Agreement shall have been issued and sold to Xxxxxxx Xxxxx.
(iv) The Seller shall have furnished to the Purchaser such other
certificates of its officers or others and such other documents and
opinions of counsel to evidence fulfillment of the conditions set forth in
this Agreement and the transactions contemplated hereby as the Purchaser
and its counsel may reasonably request.
(b) The obligations of the Seller under this Agreement shall be
subject to the satisfaction, on or prior to the Closing Date, of the following
conditions:
(i) The obligations of the Purchaser required to be performed by it on
or prior to the Closing Date pursuant to the terms of this Agreement shall
have been duly performed and complied with in all material respects, and
all of the representations and warranties of the Purchaser under this
Agreement shall be true and correct in all material respects as of the date
hereof and as of the Closing Date, and no event shall have occurred which
would constitute a breach by it of the terms of this Agreement, and the
Seller shall have received a certificate to that effect signed by an
authorized officer of the Purchaser.
(ii) The Seller shall have received copies of all of the following
closing documents, in such forms as are agreed upon and reasonably
acceptable to the Seller, duly executed by all signatories other than the
Seller as required pursuant to the respective terms thereof:
(A) [Reserved];
(B) The Pooling and Servicing Agreement, in form and substance
reasonably satisfactory to the Seller, and all documents required
thereby duly executed by all signatories;
(C) A certificate of an officer of the Purchaser dated as of the
Closing Date, in a form reasonably acceptable to the Seller, and
attached thereto the resolutions of the Purchaser authorizing the
transactions contemplated by this Agreement and the Pooling and
Servicing Agreement, together with copies of the Purchaser's articles
of incorporation, and evidence as to the good standing of the
Purchaser dated as of a recent date;
(D) One or more opinions of counsel from the Purchaser's counsel
in form and substance reasonably satisfactory to the Seller; and
(E) Such other documents, certificates (including additional
representations and warranties) and opinions as may be reasonably
necessary to secure the intended rating from each Rating Agency for
the Certificates;
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Section 11. Fees and Expenses.
Subject to Section 16 hereof, the Seller shall pay on the Closing Date or
such later date as may be agreed to by the Purchaser (i) the fees and expenses
of the Seller's attorneys and the reasonable fees and expenses of the
Purchaser's attorneys, (ii) the fees and expenses of Deloitte & Touche LLP,
(iii) the filing fee charged by the Commission for the registration of the
Certificates, (iv) the fees and expenses including counsel's fees and expenses
in connection with any "blue sky" and legal investment matters, (v) the fees and
expenses of the Trustee which shall include without limitation the fees and
expenses of the Trustee (and the fees and disbursements of its counsel) with
respect to (A) legal and document review of this Agreement, the Pooling and
Servicing Agreement, the Certificates and related agreements, (B) attendance at
the Closing and (C) review of the Mortgage Loans to be performed by the Trustee,
(vi) the expenses for printing or otherwise reproducing the Certificates, the
Prospectus and the Prospectus Supplement, (vii) the fees and expenses of each
Rating Agency (both initial and ongoing), (viii) [Reserved], and (ix) Mortgage
File due diligence expenses and other out-of-pocket expenses incurred by the
Purchaser in connection with the purchase of the Mortgage Loans and by Xxxxxxx
Xxxxx in connection with the sale of the Offered Certificates. The Seller
additionally agrees to pay directly to any third party on a timely basis the
fees provided for above which are charged by such third party and which are
billed periodically.
Section 12. Accountants' Letters
Deloitte & Touche LLP will review the characteristics of a sample of the
Mortgage Loans described in the Final Mortgage Loan Schedule and will compare
those characteristics to the description of the Mortgage Loans contained in the
Prospectus Supplement under the captions "Summary--The Mortgage Loans," "The
Mortgage Pool" and "Annex II--The Mortgage Pool." The Seller will cooperate with
the Purchaser in making available all information and taking all steps
reasonably necessary to permit such accountants to complete the review and to
deliver the letters required of them under the Underwriting Agreement. Deloitte
& Touche LLP will also confirm certain calculations as set forth under the
caption "Yield, Prepayment and Maturity Considerations" in the Prospectus
Supplement.
Section 13. Indemnification.
(a) The Seller shall indemnify and hold harmless the Purchaser and its
directors, officers and controlling persons (as defined in Section 15 of the
Securities Act) from and against any loss, claim, damage or liability or action
in respect thereof, to which they or any of them may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon (i) any untrue statement of a material
fact contained in the Seller's Information as identified in Exhibit 2, the
omission to state in the Prospectus Supplement or Prospectus (or any amendment
thereof or supplement thereto approved by the Seller and in which additional
Seller's Information is identified), in reliance upon and in conformity with
Seller's Information a material fact required to be stated therein or necessary
to make the statements therein in light of the circumstances in which they were
made, not misleading, (ii) any representation or warranty made by the Seller in
Section 7 or Section 8 hereof being, or alleged to be, untrue or incorrect, or
(iii) any failure by the Seller to perform its obligations under this Agreement;
and the Seller shall reimburse the Purchaser and each other
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indemnified party for any legal and other expenses reasonably incurred by them
in connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action.
(b) The Seller shall indemnify and hold harmless the Purchaser, the
Trust Fund and the Trustee against any documented out-of-pocket losses,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments, and other costs and expenses resulting from any claim, demand,
defense or assertion by any third party that results from, a material breach of
the representations and warranties set forth in Section 7 of this Agreement;
provided, however, indemnification shall not be available for any economic
losses of the Purchaser due to reinvestment losses, loss of investment income or
any other special, indirect or consequential losses. The Seller shall indemnify
and hold harmless the Purchaser, the Trust Fund and the Trustee against any
losses, penalties, fines, forfeitures, reasonable and necessary legal fees and
related costs, judgments, and other costs and expenses resulting from any claim,
demand, defense or assertion by any third party in connection with the Georgia
Fair Lending Act; provided, however, indemnification shall not be available for
any economic losses of the Purchaser due to reinvestment losses, loss of
investment income or any other special, indirect or consequential losses.
The foregoing indemnity agreement is in addition to any liability which the
Seller otherwise may have to the Purchaser or any other such indemnified party.
(c) The Purchaser shall indemnify and hold harmless the Seller and its
respective directors, officers and controlling persons (as defined in Section 15
of the Securities Act) from and against any loss, claim, damage or liability or
action in respect thereof, to which they or any of them may become subject,
under the Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon (i) any untrue statement of
a material fact contained in the Purchaser's Information as identified in
Exhibit 3, the omission to state in the Prospectus Supplement or Prospectus (or
any amendment thereof or supplement thereto approved by the Purchaser and in
which additional Purchaser's Information is identified), in reliance upon and in
conformity with the Purchaser's Information, a material fact required to be
stated therein or necessary to make the statements therein in light of the
circumstances in which they were made, not misleading, (ii) any representation
or warranty made by the Purchaser in Section 9 hereof being, or alleged to be,
untrue or incorrect, or (iii) any failure by the Purchaser to perform its
obligations under this Agreement; and the Purchaser shall reimburse the Seller,
and each other indemnified party for any legal and other expenses reasonably
incurred by them in connection with investigating or defending or preparing to
defend any such loss, claim, damage, liability or action. The foregoing
indemnity agreement is in addition to any liability which the Purchaser
otherwise may have to the Seller, or any other such indemnified party,
(d) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but the
failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 13 except to the extent that it
has been prejudiced in any material respect by such failure or from any
liability which it may have otherwise). In case any such action is
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brought against any indemnified party, and it notifies an indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent it may elect by written notice delivered to the
indemnified party promptly (but, in any event, within 30 days) after receiving
the aforesaid notice from such indemnified party, to assume the defense thereof
with counsel reasonably satisfactory to such indemnified party. Notwithstanding
the foregoing, the indemnified party or parties shall have the right to employ
its or their own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of such indemnified party or parties unless (i)
the employment of such counsel shall have been authorized in writing by one of
the indemnifying parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to have charge of the
defense of such action within a reasonable time after notice of commencement of
the action, or (iii) such indemnified party or parties shall have reasonably
concluded that there is a conflict of interest between itself or themselves and
the indemnifying party in the conduct of the defense of any claim or that the
interests of the indemnified party or parties are not substantially co-extensive
with those of the indemnifying party (in which case the indemnifying parties
shall not have the right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees and expenses
shall be borne by the indemnifying parties (provided, however, that the
indemnifying party shall be liable only for the fees and expenses of one counsel
in addition to one local counsel in the jurisdiction involved. Anything in this
subsection to the contrary notwithstanding, an indemnifying party shall not be
liable for any settlement or any claim or action effected without its written
consent; provided, however, that such consent was not unreasonably withheld.
(e) If the indemnification provided for in paragraphs (a) and (b) of
this Section 13 shall for any reason be unavailable to an indemnified party in
respect of any loss, claim, damage or liability, or any action in respect
thereof, referred to in Section 13, then the indemnifying party shall in lieu of
indemnifying the indemnified party contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, in such proportion as shall be appropriate to reflect
the relative benefits received by the Seller on the one hand and the Purchaser
on the other from the purchase and sale of the Mortgage Loans, the offering of
the Certificates and the other transactions contemplated hereunder. No person
found liable for a fraudulent misrepresentation shall be entitled to
contribution from any person who is not also found liable for such fraudulent
misrepresentation.
(f) The parties hereto agree that reliance by an indemnified party on
any publicly available information or any information or directions furnished by
an indemnifying party shall not constitute negligence, bad faith or willful
misconduct by such indemnified party.
Section 14. Notices.
All demands, notices and communications hereunder shall be in writing but
may be delivered by facsimile transmission subsequently confirmed in writing.
Notices to the Seller shall be directed to Xxxxxxx Xxxxx Mortgage Lending Inc.,
0 Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (Telecopy: 212-449-6710), and
notices to the Purchaser shall be directed to Xxxxxxx Xxxxx Mortgage Investors,
Inc., 0 Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (Telecopy:
212-449-6710), or to any other address as may hereafter be furnished by one
party to the other party by like notice. Any such demand, notice or
communication hereunder shall be
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deemed to have been received on the date received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt) provided that it is received on a business day
during normal business hours and, if received after normal business hours, then
it shall be deemed to be received on the next business day.
Section 15. Transfer of Mortgage Loans.
The Purchaser retains the right to assign the Mortgage Loans and any or all
of its interest under this Agreement to the Trustee without the consent of the
Seller, and, upon such assignment, the Trustee shall succeed to the applicable
rights and obligations of the Purchaser hereunder; provided, however, the
Purchaser shall remain entitled to the benefits set forth in Sections 11, 13 and
17 hereto and as provided in Section 2(a). Notwithstanding the foregoing, the
sole and exclusive right and remedy of the Trustee with respect to a breach of
representation or warranty of the Seller shall be the purchase or substitution
obligations of the Seller contained in Sections 5 and 7 hereof.
Section 16. Termination.
This Agreement may be terminated (a) by the mutual consent of the parties
hereto prior to the Closing Date, (b) by the Purchaser, if the conditions to the
Purchaser's obligation to close set forth under Section 10(a) hereof are not
fulfilled as and when required to be fulfilled or (c) by the Seller, if the
conditions to the Seller's obligation to close set forth under Section 10(b)
hereof are not fulfilled as and when required to be fulfilled. In the event of
termination pursuant to clause (b), the Seller shall pay, and in the event of
termination pursuant to clause (c), the Purchaser shall pay, all reasonable
out-of-pocket expenses incurred by the other in connection with the transactions
contemplated by this Agreement. In the event of a termination pursuant to clause
(a), each party shall be responsible for its own expenses.
Section 17. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement,
or contained in certificates of officers of the Seller submitted pursuant
hereto, shall remain operative and in full force and effect and shall survive
delivery of the Mortgage Loans to the Purchaser (and by the Purchaser to the
Trustee). Subsequent to the delivery of the Mortgage Loans to the Purchaser, the
Seller's representations and warranties contained herein with respect to the
Mortgage Loans shall be deemed to relate to the Mortgage Loans actually
delivered to the Purchaser and included in the Final Mortgage Loan Schedule and
any Substitute Mortgage Loan and not to those Mortgage Loans deleted from the
Preliminary Mortgage Loan Schedule pursuant to Section 3 hereof prior to the
Closing.
Section 18. 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
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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 obligation to
deliver or cause to be delivered the consideration for the Mortgage Loans
pursuant to Section 2 hereof. 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 10 hereof shall have been satisfied and the
Purchaser shall not have paid or caused to be paid the purchase price as
described in Section 2(c) hereof, 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 18 shall be deemed to have been released.
Section 19. Severability.
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 20. Counterparts.
This Agreement may be executed in counterparts, each of which will be an
original, but which together shall constitute one and the same agreement.
Section 21. Amendment.
This Agreement cannot be amended or modified in any manner without the
prior written consent of each party.
Section 22. GOVERNING LAW.
THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE AND PERFORMED IN THE STATE
OF NEW YORK AND SHALL BE INTERPRETED IN
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ACCORDANCE WITH THE LAWS OF SUCH STATE, WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES OF SUCH STATE.
Section 23. Further Assurances.
Each of the parties agrees to execute and deliver such instruments and take
such actions as another party may, from time to time, reasonably request in
order to effectuate the purpose and to carry out the terms of this Agreement
including any amendments hereto which may be required by either Rating Agency.
Section 24. Successors and Assigns.
This Agreement shall bind and inure to the benefit of and be enforceable by
the Seller and the Purchaser and their permitted successors and assigns and, to
the extent specified in Section 13 hereof, Xxxxxxx Xxxxx, and their directors,
officers and controlling persons (within the meaning of federal securities
laws). The Seller acknowledges and agrees that the Purchaser may assign its
rights under this Agreement (including, without limitation, with respect to the
Seller's representations and warranties respecting the Mortgage Loans) to the
Trustee. Any person into which the Seller may be merged or consolidated (or any
person resulting from any merger or consolidation involving the Seller), any
person resulting from a change in form of the Seller or any person succeeding to
the business of the Seller, shall be considered the "successor" of the Seller
hereunder and shall be considered a party hereto without the execution or filing
of any paper or any further act or consent on the part of any party hereto.
Except as provided in the two preceding sentences, this Agreement cannot be
assigned, pledged or hypothecated by either party hereto without the written
consent of the other parties to this Agreement and any such assignment or
purported assignment shall be deemed null and void.
Section 25. The Seller.
The Seller will keep in full effect all rights as are necessary to perform
their respective obligations under this Agreement.
Section 26. Entire Agreement.
This Agreement contains the entire agreement and understanding between the
parties with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements, understandings, inducements and conditions, express
or implied, oral or written, of any nature whatsoever with respect to the
subject matter hereof.
Section 27. No Partnership.
Nothing herein contained shall be deemed or construed to create a
partnership or joint venture between the parties hereto.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto by their respective duly authorized officers as of the date first above
written.
XXXXXXX XXXXX MORTGAGE LENDING, INC.
By:
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Name:
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Title:
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XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
By:
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Name: Xxxx Park
Title: Authorized Signatory
EXHIBIT 1
MORTGAGE LOAN SCHEDULE INFORMATION
The Mortgage Loan Schedule shall set forth the following information with
respect to each Mortgage Loan:
(1) the Seller's Mortgage Loan identifying number;
(2) the Mortgagor's first and last name;
(3) the street address of the Mortgaged Property including the state and
zip code;
(4) a code indicating whether the Mortgaged Property is owner-occupied;
(5) the type of Residential Dwelling constituting the Mortgaged Property;
(6) the original months to maturity, calculated (i) in the case of a
modified loan, the number of months between the date on which the
first Monthly Payment was due per the modification agreement on such
Mortgage Loan and the stated maturity date per the modification
agreement, and (ii) in the case of a non-modified loan, the number of
months between the date on which the first Monthly Payment was due on
such Mortgage Loan and the stated maturity date;
(7) the original date of the Mortgage Loan, and if the loan has been
modified, the modification date of the Mortgage Loan, and the
remaining months to maturity from the Cut-off Date, based on the
original amortization schedule;
(8) the Loan-to-Value Ratio at origination, except with respect to a
modified loan, for which such calculation shall be performed using the
appraisal obtained at the time of the modification and without regards
to sales price;
(9) the Mortgage Interest Rate in effect immediately following the Cut-off
Date;
(10) the date on which the first Monthly Payment was due on the Mortgage
Loan, except with respect to a modified loan, the date on which the
first Monthly Payment was due on the loan per the modification
agreement;
(11) the stated maturity date, except with respect to a modified loan, the
date on which the stated maturity date on the loan per the
modification agreement;
(12) the amount of the Monthly Payment at origination, except with respect
to a modified loan, the amount of the initial Monthly Payment per the
modification agreement;
(13) the amount of the Monthly Payment as of the Cut-off Date;
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(14) the last Due Date on which a Monthly Payment was actually applied to
the unpaid Stated Principal Balance;
(15) the original principal amount of the Mortgage Loan, except with
respect to a modified loan, the principal amount stated on the
modification agreement as then due;
(16) the Stated Principal Balance of the Mortgage Loan as of the close of
business on the Cut-off Date;
(17) with respect to each Adjustable Rate Mortgage Loan, the first Mortgage
Interest Rate Adjustment Date and the number of months between each
Adjustment Date thereafter, except with respect to a modified loan
that is an Adjustable Rate Mortgage Loan, the first Mortgage Interest
Rate Adjustment Date per the modification agreement;
(18) with respect to each Adjustable Rate Mortgage Loan, the number of days
prior to the origination date and each Adjustment Date thereafter,
whereby the Index is determined;
(19) with respect to each Adjustable Rate Mortgage Loan, the Gross Margin,
except with respect to a modified loan, the Gross Margin stated on the
modification agreement;
(20) with respect to each Adjustable Rate Mortgage Loan, the Periodic Rate
Cap, except with respect to a modified loan, the Periodic Rate Cap
stated on the modification agreement;
(21) with respect to each Adjustable Rate Mortgage Loan, the Initial Rate
Cap, except with respect to a modified loan, the Initial Rate Cap
stated on the modification agreement;
(22) a code indicating the purpose of the loan (i.e., purchase financing,
Rate/Term Refinancing, Cash-Out Refinancing);
(23) with respect to each Adjustable Rate Mortgage Loan, the Maximum
Mortgage Interest Rate under the terms of the Mortgage Note, except
with respect to a modified loan, the Maximum Mortgage Interest Rate
stated on the modification agreement;
(24) with respect to each Adjustable Rate Mortgage Loan, the Minimum
Mortgage Interest Rate under the terms of the Mortgage Note, except
with respect to a modified loan, the Minimum Mortgage Interest Rate
stated on the modification agreement;
(25) the Mortgage Interest Rate at origination, except with respect to a
modified loan, for which the initial Mortgage Interest Rate per the
modification agreement shall be provided;
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(26) with respect to each Adjustable Rate Mortgage Loan, the first
Adjustment Date immediately following the Cut-off Date;
(27) with respect to each Adjustable Rate Mortgage Loan, the Index and the
number of decimal places to which the Index is rounded;
(28) a code indicating whether the Mortgage Loan is an Adjustable Rate
Mortgage Loan or a Fixed Rate Mortgage Loan, where for modified loans,
the code reflects the whether the modified loan is an Adjustable Rate
Mortgage Loan or a Fixed Rate Mortgage Loan;
(29) a code indicating the documentation style (i.e., full, alternative or
reduced);
(30) a code indicating if the Mortgage Loan is subject to a Primary
Insurance Policy;
(31) a code indicating whether the Mortgage Loan is a Buydown Mortgage
Loan;
(32) a code indicating the product type of the Mortgage Loan;
(33) a code indicating whether the Mortgage Loan is subject to a Prepayment
Charge, the term of such Prepayment Charge, the amount of such
Prepayment Charge to be provided on a prepayment penalty matrix
attached to such Mortgage Loan Schedule;
(34) the Appraised Value of the Mortgaged Property, and if such loan is a
modified loan, the Appraised Value;
(35) the sale price of the Mortgaged Property, if applicable;
(36) a code indicating whether the Mortgaged Property is subject to a First
Lien or a Second Lien;
(37) the Credit Score of the Mortgagor;
(38) the Mortgagor's debt to income ratio;
(39) with respect to each Adjustable Rate Mortgage Loan, to the extent that
such Mortgage Loan is an interest only loan, the number of
months/years whereby the scheduled payment payable by a Mortgagor
under the related Mortgage Note on each Due Date includes only
interest payments;
(40) points and fees at origination, described in the aggregate;
(41) a code indicating whether the borrower is self-employed;
(42) the Mortgagor's monthly income;
(43) the number of months from disposition of bankruptcy (use "999" to
indicate no bankruptcy);
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(44) the number of months from disposition of foreclosure (use "999" to
indicate no foreclosure);
(45) a payment string relating to payment history for the past 12 months of
the current mortgage loan performance;
(46) the Combined Loan-to-Value Ratio (including all senior and junior
mortgage loans), using the appraisal obtained at the time of
modification in relation to modified loans;
(47) the original balance on any mortgage loan senior in priority to the
Mortgage Loan;
(48) the Mortgagor's social security number;
(49) the type of appraisal performed on the Mortgaged Property;
(50) a code indicating whether the Mortgage Note permits negative
amortization;
(51) a code indicating whether the Mortgage Note permits deferred interest;
(52) a code indicating whether the Mortgage is a graduated payment mortgage
loan;
(53) a code indicating whether the Mortgage Loan is a reverse-mortgage
loan;
(54) the unpaid principal balance of the Mortgage Loan;
(55) with respect to any modification agreement, the modification type; and
(56) with respect to each DAD Loan (as defined in Section 7(29)), the
dividend rate and the reserved amount.
With respect to the Mortgage Loan Package in the aggregate, the Final 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 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.
Schedule I hereto shall be supplemented as of each Closing Date to reflect the
addition of the Final Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
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EXHIBIT 2
SELLER'S INFORMATION
All information in the Prospectus Supplement described under the following
Sections: "Summary--The Mortgage Loans," "The Mortgage Pool" and "Annex II--The
Mortgage Pool."
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EXHIBIT 3
PURCHASER'S INFORMATION
All information in the Prospectus Supplement and the Prospectus, except the
Seller's Information.
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EXHIBIT 4
CONTENTS OF EACH MORTGAGE FILE
[Intentionally Omitted]
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EXHIBIT 5
APPENDIX E -- STANDARD & POOR'S PREDATORY LENDING CATEGORIES
REVISED April 18, 2006
Standard & Poor's has categorized loans governed by anti-predatory lending laws
in the Jurisdictions listed below into three categories based upon a combination
of factors that include (a) the risk exposure associated with the assignee
liability and (b) the tests and thresholds set forth in those laws. Note that
certain loans classified by the relevant statute as Covered are included in
Standard & Poor's High Cost Loan Category because they included thresholds and
tests that are typical of what is generally considered High Cost by the
industry.
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
Name of Anti-Predatory Category under Applicable
State/Jurisdiction Lending Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------------------------------------ ---------------------------
Arkansas Arkansas Home Loan Protection Act, Ark. High Cost Home Loan
Code Xxx. Sections 00-00-000 et seq.
Effective July 16, 0000
Xxxxxxxxx Xxxxxxx, XX Ordinance No. 72-2003 (PSH), Mun. Code Covered Loan
Sections 757.01 et seq.
Effective June 2, 2003
Colorado Consumer Equity Protection, Colo. Stat. Covered Loan
Xxx. Sections 5-3.5-101 et seq.
Effective for covered loans offered or
entered into on or after January 1, 2003.
Other provisions of the Act took effect on
June 7, 0000
Xxxxxxxxxxx Xxxxxxxxxxx Abusive Home Loan Lending High Cost Home Loan
Practices Act, Conn. Gen. Stat. Sections 36a-746
et seq.
Effective October 1, 0000
Xxxxxxxx xx Xxxxxxxx Home Loan Protection Act, D.C. Code Covered Loan
Sections 26-1151.01 et seq.
Effective for loans closed on or after
January 28, 2003
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Name of Anti-Predatory Category under Applicable
State/Jurisdiction Lending Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------------------------------------ ---------------------------
Florida Fair Lending Act, Fla. Stat. Xxx. High Cost Home Loan
Sections 494.0078 et seq.
Effective October 2, 2002
Georgia (Oct. 1, 0000 Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. High Cost Home Loan
-- Mar. 6, 2003) Sections 7-6A-1 et seq.
Effective October 1, 2002 -- Xxxxx 0, 0000
Xxxxxxx as amended Georgia Fair Lending Act, Ga. Code Xxx. High Cost Home Loan
(Mar. 7, 2003 -- current) Sections 7-6A-1 et seq.
Effective for loans closed on or after
Xxxxx 0, 0000
XXXXX Section 32 Home Ownership and Equity Protection Act of High Cost Loan
1994, 15 U.S.C. Section 1639, 12 C.F.R.
Sections 226.32 and 226.34
Effective October 1, 1995, amendments
October 1, 2002
Illinois High Risk Home Loan Act, Ill. Comp. Stat. High Risk Home Loan
tit. 815, Sections 137/5 et seq.
Effective January 1, 2004 (prior to this
date, regulations under Residential Mortgage
License Act effective from May 14, 2001)
Kansas Consumer Credit Code, Kan. Stat. Xxx. High Loan to Value Consumer
Sections 16a-1-101 et seq. Loan (id. Section
16a-3-207) and;
Sections 16a-1-301 and 16a-3-207 became High APR Consumer Loan (id.
effective April 14, 1999; Section Section 16a-3-308a)
16a-3-308a became effective July 1, 1999
Kentucky 2003 KY H.B. 287 -- High Cost Home Loan High Cost Home Loan
Act, Ky. Rev. Stat. Sections 360.100 et seq.
Effective June 24, 2003
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Name of Anti-Predatory Category under Applicable
State/Jurisdiction Lending Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------------------------------------ ---------------------------
Maine Truth in Lending, Me. Rev. Stat. tit. 9-A, High Rate High Fee Mortgage
Sections 8-101 et seq.
Effective September 29, 1995 and as amended
from time to time
Massachusetts Part 40 and Part 32, 209 C.M.R. High Cost Home Loan
Sections 32.00 et seq. and 209 C.M.R.
Sections 40.01 et seq.
Effective March 22, 2001 and amended from
time to time
Nevada Assembly Xxxx No. 284, Nev. Rev. Stat. Home Loan
Sections 598D.010 et seq.
Effective October 1, 2003
New Jersey New Jersey Home Ownership Security Act of High Cost Home Loan
2002, N.J. Rev. Stat. Sections 46:10B-22 et seq.
Effective for loans closed on or after
November 27, 2003
New Mexico Home Loan Protection Act, N.M. Rev. Stat. High Cost Home Loan
Sections 58-21A-1 et seq.
Effective as of January 1, 2004; Revised as
of February 26, 2004
New York N.Y. Banking Law Article 6-l High Cost Home Loan
Effective for applications made on or after
April 1, 2003
North Carolina Restrictions and Limitations on High Cost High Cost Home Loan
Home Loans, N.C. Gen. Stat. Sections 24-1.1E et
seq.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
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Name of Anti-Predatory Category under Applicable
State/Jurisdiction Lending Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------------------------------------ ---------------------------
Ohio H.B. 386 (codified in various sections of Covered Loan
the Ohio Code), Ohio Rev. Code Xxx.
Sections 1349.25 et seq.
Effective May 24, 2002
Oklahoma Consumer Credit Code (codified in various Subsection 10 Mortgage
sections of Title 14A)
Effective July 1, 2000; amended effective
January 1, 2004
South Carolina South Carolina High Cost and Consumer Home High Cost Home Loan
Loans Act, S.C. Code Xxx. Sections 37-23-10 et
seq.
Effective for loans taken on or after
January 1, 0000
Xxxx Xxxxxxxx Xxxx Xxxxxxxx Residential Mortgage Lender, West Virginia Mortgage Loan
Broker and Servicer Act, W. Va. Code Xxx. Act Loan
Sections 31-17-1 et seq.
Effective June 5, 2002
STANDARD & POOR'S COVERED LOAN CATEGORIZATION
Name of Anti-Predatory Category under Applicable
State/Jurisdiction Lending Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------------------------------------ ---------------------------
Georgia (Oct. 1, 0000 Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. Covered Loan
-- Mar. 6, 2003) Sections 7-6A-1 et seq.
Effective October 1, 2002 -- March 6, 0000
Xxx Xxxxxx Xxx Xxxxxx Home Ownership Security Act of Covered Home Loan
2002, N.J. Rev. Stat. Sections 46:10B-22 et seq.
Effective November 27, 2003 -- July 5, 2004
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STANDARD & POOR'S HOME LOAN CATEGORIZATION
Name of Anti-Predatory Category under Applicable
State/Jurisdiction Lending Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------------------------------------ ---------------------------
Georgia (Oct. 1, 0000 Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. Home Loan
-- Mar. 6, 2003) Sections 7-6A-1 et seq.
Effective October 1, 2002 -- March 6, 0000
Xxx Xxxxxx Xxx Xxxxxx Home Ownership Security Act of Home Loan
2002, N.J. Rev. Stat. Sections 46:10B-22 et seq.
Effective for loans closed on or after
November 27, 2003
New Mexico Home Loan Protection Act, N.M. Rev. Stat. Home Loan
Sections 58-21A-1 et seq.
Effective as of January 1, 2004; Revised as
of February 26, 2004
North Carolina Restrictions and Limitations on High Cost Consumer Home Loan
Home Loans, N.C. Gen. Stat. Sections 24-1.1E et
seq.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
South Carolina South Carolina High Cost and Consumer Home Consumer Home Loan
Loans Act, S.C. Code Xxx. Sections 37-23-10 et
seq.
Effective for loans taken on or after
January 1, 2004
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Schedule A
MORTAGE LOAN SCHEDULE
[Intentionally Omitted]
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Schedule B
REQUIRED RATINGS FOR EACH CLASS OF CERTIFICATES
Offered Certificates
Class Xxxxx'x S&P
---------- ------- ---
Class A-1 Aaa AAA
Class A-2A Aaa AAA
Class A-2B Aaa AAA
Class A-2C Aaa AAA
Class R N/R AAA
Class M-1 Aa1 AA+
Class M-2 Aa2 AA+
Class M-3 Aa3 AA+
Class M-4 A1 AA+
Class X-0 X0 XXx
Xxxxx X-0 X0 XX
Class B-1 Baa1 AA
Class X-0 Xxx0 XX-
Xxxxx X-0 Xxx0 XX-
Xxxx of the above ratings has been lowered since the respective dates of
such letters.
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