Exhibit 10.8
EXECUTION
AMENDED AND RESTATED MASTER SERVICE AGREEMENT
     Amended and Restated Master Service Agreement, dated as of March 29, 2010
and effective as of January 1, 2010 (the “Agreement”) between Aurora Bank FSB
(as successor to Atlantic Bank and Trust Company, the “Servicer”) and Capital
Crossing Preferred Corporation (as successor to Atlantic Preferred Capital
Corporation, the “Customer”). As of the date hereof, this Agreement amends and
restates in its entirety that certain Master Services Agreement dated as of
March 31, 1998 by and between the Servicer and the Customer (the “Existing
MSA”).
     WHEREAS, the Customer currently owns and may from time to time acquire
ownership to certain residential and commercial mortgage loans and real estate
owned properties;
     WHEREAS, the Customer and the Servicer have previously contracted for
certain servicing responsibilities (the “Services” or individually a “Service”)
associated with the assets currently owned by the Customer and the Servicer is
performing the Services with respect to such assets, including, but not limited
to, the following: (1) data processing services as described in Exhibit A
annexed hereto, including the preparation of reports and other back office
operations support services as necessary to provide said data processing
services, (2) loan servicing for all mortgage loans held by the Customer as
described in Exhibit B annexed hereto; and (3) nonperforming loan services and
foreclosure services as described in Exhibit C annexed hereto; and
     WHEREAS, the Customer and the Servicer desire to (i) amend and restate in
their entirety the terms and a conditions upon which the Servicer currently
performs the Services and (ii) set forth the terms and conditions on which the
Servicer will perform the Services from and after the date hereof.
     NOW, THEREFORE, in consideration of the mutual promises, covenants and
conditions set forth herein, the parties hereto agree as follows:
     1. The Servicer shall provide the services described in Exhibits A through
C annexed hereto for the Customer at the rates set forth in Exhibit D annexed
hereto.
     2. Notwithstanding anything to the contrary set forth herein, the Servicer
may employ vendors and subservicers (each, a “Subservicer”) to carry out its
obligations under this Agreement upon obtaining the approval of a majority of
the board of directors of the Customer, including a majority of the members of
the board who are not either (i) current officers or employees of the Customer
or (ii) current officers, directors or employees of the Servicer or any
affiliate of the Servicer; provided, that the use by the Servicer of any such
vendor or Subservicer shall not release the Servicer from any of its obligations
hereunder and the Servicer shall remain responsible hereunder for all acts and
omissions of such vendors and Subservicers as fully as if such acts and
omissions were those of the Servicer. Except as set forth in this Agreement, the
Servicer shall pay all fees and expenses of its third party vendors or
Subservicers from its own funds. Each agreement between the Servicer and a
Subservicer that obligates the Subservicer to perform the primary servicing
responsibilities with respect to any mortgage loan subject hereto shall
hereinafter be referred to as a “Subservicing Agreement”. The Customer hereby
represents

 

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and warrants to the Servicer that a majority of the board of directors of the
Customer, including a majority of the members of the board who are not either
(i) current officers or employees of the Customer or (ii) current officers,
directors or employees of the Servicer or any affiliate of the Servicer, has
approved, effective as of October 1, 2009, the Servicer’s engagement of certain
subservicers separately identified by the Customer and the Servicer as initial
subservicers hereunder and the Servicer’s engagement of a certain subcontractor
separately identified by the Customer and the Servicer to perform certain
administrative obligations of the Servicer hereunder.
     3. Unless otherwise terminated pursuant to the terms hereof, this Agreement
shall terminate upon (a) the later of (i) the distribution of the final payment
or liquidation proceeds on the last mortgage loan subject hereto to the Customer
and (ii) the disposition of all REO property subject hereto and the remittance
of all funds due hereunder or (b) mutual consent of the Servicer and the
Customer in writing.
     4. The Servicer shall revise Exhibit D to modify the rates set forth on
Exhibit D from time to time during the Term to reflect changes in the actual
costs incurred or estimated costs to be incurred by the Servicer in providing
the Services to the Customer. Such revised Exhibit D shall be substituted for
the Exhibit D then in effect and shall become effective upon the date set forth
in such a revised Exhibit D.
     5. (a) The Customer represents that Exhibits A through C contain a general
description of the Services to be provided by the Servicer to the Customer. In
performing these services, the scope of the work undertaken and the manner of
its performance shall be substantially the same as for similar work performed by
the Servicer for transactions on its own behalf, with such modifications as may
be appropriate in order to accomplish the purposes of this Agreement. The
Servicer shall give the Customer reasonable notice of all system changes
affecting the Customer’s procedures or reports as these changes pertain to the
Services.
          (b) The Servicer reserves the right to alter the contents of reports,
eliminate reports, add reports or change the frequency of delivery of reports
described in Exhibits A through C.
          (c) If the changes referred to in paragraph (a) or (b) above are not
acceptable to the Customer, the Customer may terminate this Agreement on the
greater of (i) thirty (30) days’ written notice and (ii) the number of days’
written notice equal to the sum of five (5) Business Days (as defined below)
plus the number of days notice upon which the Servicer is permitted to terminate
each related Subservicing Agreement without cause, provided any such notice is
given within ten (10) days after the Customer has received notice of such
change.
     6. (a) The Customer shall furnish all data, records and materials in the
manner, at the place and within the time limits determined by the Servicer to be
necessary to perform the Services. The Customer shall prepare all data submitted
for processing with reasonable care and in a manner acceptable to the Servicer.
          (b) The Customer hereby agrees that the costs incurred by the Servicer
because data, records or materials sent by or for the Customer are not in the
form required by this Agreement or are not received by the Servicer in
accordance with the time schedule established

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to permit the Servicer to meet its required delivery schedule are the
responsibility of the Customer.
          (c) The Servicer shall not be responsible for errors resulting from
any incorrect data submitted for processing by the Customer. The Servicer may,
however, make minor corrections of the data if the original source documents are
in error or make other minor adjustments, without charge, unless the volume of
such items becomes unreasonable in the judgment of the Servicer, at which time
the Servicer may notify the Customer of its intention to impose charges for such
additional work at its then prevailing rates.
     7. It is understood and agreed that the performance of the Services is or
might be subject to regulation and examination by authorized representatives of
the federal or state bank regulatory agencies, and that each party is and shall
be authorized to submit or furnish to any such regulatory agency reports,
information, assurances and other data as may be required by, or reasonably
requested of it, under applicable laws and regulations, including, without
limitation, any appropriate notifications concerning the initiation or
termination of this Agreement or any of the Services provided to the Customer.
Each party shall afford the other party or any examiners or authorized
representatives of federal or state bank regulatory agencies or either parties’
independent auditors or legal counsel access to loan documentation or any other
data governed by this Agreement.
     8. The Servicer shall, with appropriate charge, promptly make any and all
modifications to forms, documents and reporting methods as may be required to
comply with any statutory, regulatory, or administrative rules or other legal
requirements. The Servicer, subject to Customer providing reasonable notice as
established by Servicer, shall make and implement any modification to forms,
documents and reporting methods required in response to such statutory,
regulatory, or administrative rules or other legal requirements by such time as
the modifications may be necessary as required by law.
     9. The Servicer shall, no later than the twenty-fifth (25th) calendar day
of each calendar month, remit to the Customer all payments (other than escrow
payments) received by the Servicer during the immediately preceding calendar
month with respect to the mortgage loans subject hereto, net of all service fees
due under this Agreement and all expenses to which the Servicer is entitled to
reimbursement under this Agreement. The rates set forth in Exhibit D are
exclusive of all taxes, however designated, imposed on any amount payable
hereunder for the Servicer or their provision to the Customer. Any sales and use
taxes, however designated, and if applicable, shall be the responsibility of and
shall be paid by the Customer.
     10. In performing the Services, the Servicer shall be deemed to have an
independent contractual relationship with the Customer. It is agreed that the
Servicer and the Customer are not partners or joint venturers and that the
Servicer is not to act as agent for the Customer but is to act as an independent
contractor. The Servicer shall not be deemed to have any contractual or other
relationship with the Customer’s customers. In no event shall any of the
Customer’s customers be considered a third party beneficiary of this Agreement.
To the extent that third parties may make claims against the Servicer arising
out of the Services, the Customer agrees to indemnify and hold harmless the
Servicer from and against all loss, liability, claim, action, demand or suits,
including any claims for attorneys’ fees arising therefrom, except as otherwise
provided here.

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     11. All programs, whether standard Servicer programs or programs developed
specifically for the Customer, files and documentation, are and shall remain the
property of the Servicer, unless otherwise specified in this Agreement. Upon
termination of the Services, the Servicer will make available to the Customer
all data contained in all master files and transaction files then available
relevant to the Services. Any expense incurred by the Servicer in providing such
information shall be paid for by the Customer at the Servicer’s then prevailing
rates.
     12. Each party shall indemnify and hold the other party harmless against
any loss, damages, penalties fines forfeitures, reasonable legal fees and
related costs, judgments, and other reasonable costs and expenses resulting from
any claims, demand defense or assertion to the extent resulting from a breach of
the covenants, representations and warranties contained in this Agreement. Upon
receipt of notice of any such claims, demand, defense or assertion, the party
seeking indemnification shall promptly give written notice thereof to the other
party. The parties agree to cooperation in defense or prosecution of any claim,
demand, defense or assertion, based on or grounded upon, or resulting form, a
breach of the covenants, representations and warranties contained in this
Agreement.
     13. EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED HEREIN, THE SERVICER MAKES NO
WARRANTIES OR REPRESENTATIONS AS TO THE SERVICES, EXPRESS OR IMPLIED, IN FACT OR
IN LAW, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANT ABILITY OR FITNESS
FOR A PARTICULAR PURPOSE.
     14. The liability of the Servicer to the Customer for any loss due to the
Servicer’s performing, or failing to perform, the Services shall be contingent
upon the Customer’s compliance with its obligations herein and shall be limited
to those losses sustained by the Customer which are a direct result of the
Servicer’s negligence or willful misconduct; provided, however, that the
Servicer’s only liability to the Customer arising from any interruptions in, or
delay or unavailability of, the Services or any errors or omissions in the
Services or any loss of data, shall be to restore any Service which is
interrupted or is delayed or becomes unavailable, as promptly as reasonably
practicable and, in the case of any error or omission in a Service or loss of
data, to correct such error or omission or regenerate any lost data; provided,
further, that the Servicer shall not be obligated hereunder to correct any error
or omission in the Services if it would not ordinarily correct such error or
omission.
     15. The Servicer shall not be responsible or liable for its failure to
delay in performance or the Services when such failure or delay arises out of,
results from, or is caused by any act or omission of the Customer or by any
event beyond the control of the Servicer, as provided in Section 19 of this
Agreement.
     16. Notwithstanding anything contained herein to the contrary, the
aggregate amounts of any money damages to which the Customer and any and all
other parties claiming by, through or under the Customer, may be entitled as the
result of any claims against the Servicer (regardless of whether such claims are
based on contract, tort (including negligence and strict liability, warranty or
other legal or equitable grounds) shall be limited to an amount equal to the
lesser of (a) the actual amount of such losses, damages, injuries, claims, costs
or expenses or (b) an aggregate annual amount payable by the Customer to the
Servicer for the Service affected, as stated on Exhibit D.

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     17. The Servicer shall not incur any liability or obligation under this
Agreement by reason of any loss or damages to the Customer caused by an error or
omission by the Servicer unless the Customer shall have informed the Servicer of
such error or omission within two (2) Business Days after the discovery thereof.
The Customer agrees to use diligent efforts to reconstruct any lost data,
records or materials, and if appropriate, to charge back to the Customer’s
accounts and the forwarding banks’ accounts, and to obtain funds from its
depositors’ forwarding banks and endorsers’ banks. If the Servicer carries
insurance against the type of loss incurred, the Customer agrees to cooperate in
furnishing proof of loss in a form satisfactory to the Servicer’s insurance
company and to assist the Servicer and its insurance company in settlement of
the claim. For purposes of this Agreement, “Business Day” shall mean any day
other than (i) a Saturday or Sunday, or (ii) a day on which banking and savings
and loan institutions in the States of New York, Colorado or California are
authorized or obligated by law or executive order to be closed.
     18. In the event of any material breach of party’s obligations under this
Agreement (an “Event of Default”), the other party shall provide a written
notice of such Event of Default and a demand that such Event of Default be
cured. In the event the breaching party fails in a good faith to cure such Event
of Default within ten (10) days following receipt of such notice and demand (or,
in the case of an Event of Default by the Servicer, within the greater of
(i) ten (10) days notice following receipt of such notice and demand and
(ii) the number of days’ notice equal to the sum of two (2) Business Days plus
the number of days notice following receipt of such notice and demand upon which
the Servicer is permitted to terminate each related Subservicing Agreement in
such instance), the non-defaulting party may terminate this Agreement and/or
take legal action to obtain specific performance, injunctive and other equitable
relief as well as any other remedies as may be available at law or equity
subject to the limitations set forth in this Agreement.
     19. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, IT IS HEREBY AGREED
THAT IN NO EVENT WILL THE SERVICER BE LIABLE FOR ANY LOST PROFITS OR OTHER
INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES WHICH THE CUSTOMER MAY
INCUR OR EXPERIENCE BY REASON OF HAVING ENTERED INTO OR RELIED ON THIS AGREEMENT
OR ARISING OUT OF OR IN CONNECTION WITH THE SERVICES, EVEN IF THE SERVICER HAS
BEEN ADVISED OR IS OTHERWISE AWARE OF THE POSSIBILITY OF SUCH DAMAGES; NOR SHALL
THE SERVICER BE LIABLE FOR ACTS OF GOD, MACHINE OR COMPUTER BREAKDOWN OR
MALFUNCTION, INTERRUPTION OR MALFUNCTION OF COMMUNICATIONS OR POWER SUPPLY,
LABOR DIFFICULTIES, LEGAL ACTS OF A PUBLIC AUTHORITY, OR ANY OTHER SIMILAR CAUSE
OR CATASTROPHE BEYOND THE SERVICER’S CONTROL.
     20. The Customer may not assign this Agreement nor any of its rights or
obligations hereunder without the written consent of the Servicer. The Servicer
may assign this Agreement, and any of its rights and obligations (including,
without limitation, its obligation to provide the Services) to any affiliate of
the Customer; provided that for the avoidance of doubt, the foregoing shall not
limit the Servicer’s right to delegate the Services to one or more Subservicers
pursuant to Section 2 above.

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     21. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW), AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
     22. The Servicer will regard and preserve as confidential all data of a
confidential nature related to the business of the Customer and provided by the
Customer to the Servicer. The Servicer will take the same precautions to
preserve such confidential information as the Servicer takes with respect to its
own confidential information.
     23. This Agreement may be terminated at any time by a written agreement
between the parties and at any time by either party upon the greater of
(i) ninety (90) days’ written notice and (ii) the number of days’ written notice
equal to the sum of five (5) Business Days plus the number of days written
notice upon which the Servicer is permitted to terminate each related
Subservicing Agreement without cause. In addition, the Servicer may terminate
this Agreement with respect to any mortgage loan subject hereto simultaneous
with the effectuation of any Subservicer’s “call right” to purchase such
mortgage loans, as contemplated pursuant to Section 7.04 of that certain asset
exchange agreement dated as of November 18, 2009 by and between the Servicer and
the Customer.
     24. No waiver of any of the terms or conditions of this Agreement shall be
effective or binding unless such waiver is in writing and is signed by both of
the parties hereto, nor shall this Agreement be changed, modified, discharged or
terminated other than in accordance with its terms, in whole or in part, except
by a writing signed by both parties.
     25. All communications and notices relating to this Agreement are to be
sent:
     If to the Servicer:
Aurora Bank Commercial Services
27422 Portola Pkwy, STE 205 #419
Foothill Ranch, CA 92610
Attention: Steve Skolnik
Aurora Loan Services LLC
10350 Park Meadows Drive, 3rd Floor
Littleton, CO 80124
Attention: Todd Whittemore
with copies to:
Aurora Bank FSB
1271 Avenue of the Americas
New York, NY 10020
Attention: William K. Walenczyk

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and:
Aurora Bank FSB
1000 West Street
Wilmington, DE 19801
Attn: General Counsel
     If to the Customer:
Capital Crossing Preferred Corporation
1271 Avenue of the Americas
New York, NY 10020
Attention: President
with a copy to:
Lloyd Winans, Esq.
Alston & Bird LLP
90 Park Avenue
New York, NY 10016
or to such other address as a party may designate to the other and such notices
shall be deemed duly given three (3) days after mailed or upon delivery by hand
or upon receipt of confirmed answer back if telephoned.
     26. Whenever possible, each provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be prohibited by or invalid under
applicable law, such provision will be in effect only to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Agreement.
     27. This Agreement embodies the entire understanding of the parties with
respect to the subject matter hereof, and there are no further or other
agreements or understandings, written or oral, in effect between the parties
relating to the subject mater of this Agreement.
     28. This Agreement shall be binding upon and inure solely to the benefit of
each party hereto, and nothing in this Agreement, express or implied, is
intended to confer upon any person, any rights or remedies of any nature
whatsoever under or by reason of this Agreement.
     29. This Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute but one and the same Agreement.
(Signature Page Immediately Follows)

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers thereunto duly authorized as of the day and year
first above written.

            SERVICER:

Aurora Bank FSB
      By:   /s/ Todd Whittemore         Name:   Todd Whittemore        Title:  
Senior Vice President        CUSTOMER:

Capital Crossing Preferred Corporation
      By:   /s/ John Schmohl         Name:   John Schmohl        Title:   Chief
Operating Officer     

Signature Page to Amended and Restated Master Service Agreement

 

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EXHIBIT A
DATA PROCESSING / PROCESSING SERVICES
     Data processing services to be provided pursuant to this Agreement shall
include, but not necessarily be limited to, the following specific computer
services:
     1. All Customer application processing, regardless of where actually
processed, that presently exists or is established in the future for the conduct
of customer transactions and management information. Included herein are host
based activities and PC-based management information systems, as well as
input/output to and from such activity.
     2. All actions necessary to maintain, enhance existing or develop new data
processing services for the benefit of the Customer.
     3. Transportation of documents.
     4. Document encoding, capture, cash letter preparation, reject handling and
bulk.
     The Servicer shall receive fees from the Customer as consideration for the
performance of data processing and item processing services pursuant to the
terms of the Agreement in accordance with Exhibit D annexed hereto.

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EXHIBIT B
LOAN SERVICING
     Loan servicing to be provided pursuant to this Agreement shall include, but
not necessarily be limited to, the following specific services:
     1. Make diligent efforts to collect all sums due and payable from borrowers
under the terms of each loan;
     2. Deposit of all payments (i) made by a borrower pursuant to the terms of
a loan and collected by Servicer and (ii) required to be remitted to Customer
pursuant to the terms of this Agreement, in a separate account at the Servicer
(or applicable Subservicer) in trust for the Customer.
     3. Monthly remit to the Customer principal and interest payments collected
on loans;
     4. Reconcile account balances for any accounts established in connection
with the loan servicing performed pursuant to this Agreement.
     5. Taking all reasonable and necessary steps to cause any mortgaged
premises to be kept insured against loss or damage by fire or other hazards and
for such amounts required by the applicable Subservicing Agreement, if any, in
effect. The Servicer or the applicable Subservicer shall secure and retain
copies of any insurance policies so in effect for the benefit of the Customer;
     6. Maintain a detailed record of each loan and collection thereon. The
Customer or its authorized representative may examine such record at such time
or times as it may elect during the Servicer’s normal business hours.
     7. Take all reasonable and necessary steps to comply with and use best
efforts to cause the Customer to comply with any and all applicable federal and
state statutes or regulations or private mortgage insurance company requirements
while servicing all loans pursuant to the terms of this Agreement.
     8. In the event foreclosure proceedings are instituted, the Servicer or
Subservicer shall foreclose, manage and protect the mortgaged premises in the
manner and to the extent required pursuant to the terms of Exhibit C of the
Agreement;
     9. The Servicer shall enter all new loans and information which may be
required from time to time onto the data processing software used by the
Servicer to service loans for the Customer;
     10. The Servicer shall ensure the maintenance of perfected collateral
positions securing loans serviced pursuant to the terms of the Agreement;

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     11. The Servicer or Subservicer shall compute, notify the borrowers of, and
effect any adjustments to the interest rate and payment terms of a serviced loan
in accordance with applicable law.
     The Servicer shall receive fees from the Customer as consideration for the
performance of services pursuant to terms of the Agreement in accordance with
the schedule set forth below as Exhibit D. Servicer shall, to the extent
permitted by law, also be entitled to collect interest earned upon escrow
deposits associated with the loans under service.

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EXHIBIT C
NONPERFORMING LOAN SERVICING AND FORECLOSURE SERVICES
     Nonperforming loan servicing and foreclosure services to be provided by the
Servicer for the Customer pursuant to the Agreement shall include, but not
necessarily be limited to, the following specific services:
     1. Institution of foreclosure proceedings in the appropriate federal or
state court as deemed necessary by the Servicer;
     2. The Servicer may, at Servicer’s option, repurchase nonperforming loans
at their fair market value at the time of foreclosure and/or repossession; and
     3. The Servicer shall (or shall, to the extent Servicer has the right to do
so under the Subservicing Agreement, cause the applicable Subservicer to), if
directed by the Customer, dispose of any nonperforming loans for such amount
equal to the fair market value thereof or as otherwise approved by the Customer.
     The Servicer shall be paid a fee by the Customer as consideration for the
performance of foreclosure services pursuant to the terms of the Agreement in
accordance with Exhibit D annexed hereto.

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EXHIBIT D
SCHEDULE OF FEES FOR SERVICES
PERFORMED PURSUANT TO SERVICE AGREEMENT
     For consideration of services provided by the Servicer on behalf of the
Customer pursuant to the terms and conditions of the Agreement, Servicer shall
be entitled to retain from remittance hereunder as contemplated in Section 9
above (or the Customer shall, to the extent funds retained by the Servicer
pursuant to Section 9 above are insufficient, pay the Servicer within ten (10)
Business Days of receipt by the Customer of a related invoice) the following
fees with respect to each mortgage loan subject hereto:
     (A) The sum of $8.00 (eight dollars) per calendar month plus:
          (i) With respect to mortgage loans set forth on Schedule 1 attached
hereto, (a) an annual fee equal to the product of 0.2775% (27.75 basis points)
and the monthly outstanding principal balance of such mortgage loans plus
(b) loss mitigation fees (calculated as permitted under the Freddie Mac Guide
for servicers with a Servicer Performance Profile of Tier 1, as such terms are
defined in such Guide), a $500 REO property management fee with respect to REO
properties, and ancillary income and other fees to which the applicable
subservicer is entitled under the related Subservicing Agreement (as in effect
on the date hereof).
          (ii) With respect to assets set forth on Schedule 2 attached hereto,
(a) an annual fee equal to the product of 0.405% (40.5 basis points) and the
monthly outstanding principal balance of such assets plus (b) any ancillary
income and other fees to which the applicable subservicer is entitled under the
related Subservicing Agreement (as in effect on the date hereof).
          (iii) With respect to mortgage loans set forth on Schedule 3 attached
hereto:
     (a) with respect to each mortgage loan other than a Nonperforming Loan (as
defined in clause (b) below), an annual fee (payable in twelve (12) monthly
installments) equal to the product of 0.50% (50 basis points) and the
outstanding principal balance of such mortgage loan (as determined with respect
to each monthly installment as of the prior month end);
     (b) an annual fee (payable in twelve (12) monthly installments) equal to
the product of 1.50% (150 basis points) and the outstanding principal balance of
all mortgage loans with respect to which the related borrower has failed to make
the monthly payment due in the second calendar month immediately preceding the
calendar month in which the applicable monthly installment is payable hereunder
(each, a “Nonperforming Loan”);
     (c) a workout fee of two percent (2%) of all monthly principal and interest
payments with respect to a mortgage loan from and after the date, if any, upon
which (i) any such Nonperforming Loan becomes current or (ii) the Servicer
causes the related borrower to cure a default (other than a default with respect
to the timely payment of principal and interest) by such borrower with respect
to

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such mortgage loan; provided that this fee ceases to be payable if (x) the
applicable mortgage loan becomes an REO property, (y) the applicable mortgage
loan was a Nonperforming Loan that becomes current and then subsequently becomes
a Nonperforming Loan again or (z) with respect to a fee earned pursuant to
clause (ii) above, the default giving rise to such fee reoccurs; and
     (d) a resolution fee of two percent (2%) of the net liquidation proceeds
(total amount of monies collected at the liquidation of a mortgage loan or
foreclosed property, less advances made by the Servicer including, but not
limited to delinquent tax amounts, insurance premiums, property preservation
costs, property management costs, commissions, legal fees, and any other advance
deemed necessary by the Servicer to manage the mortgage loan or REO property)
from a delinquent mortgage loan (two or more payments past due) or REO property.
          (iv) With respect to mortgage loans made subject to this Agreement
following the date hereof, an amount mutually agreed to by the Servicer and the
Customer in writing.
     (B) Out of pocket costs related to each loan anticipated for foreclosure or
in foreclosure (past due +90 days, non-accrual, and owned real estate).

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