EXHIBIT 10.7

 

AMENDED AND RESTATED MORTGAGE LOAN REPURCHASE AGREEMENT

 

 

PURCHASER:

  

UBS WARBURG REAL ESTATE SECURITIES INC.

ADDRESS:

  

1285 AVENUE OF THE AMERICAS

    

NEW YORK, NEW YORK 10019

    

ATTENTION:GEORGE A. MANGIARACINA

    

TELEPHONE: (212) 713-3734

    

ATTENTION: ROBERT CARPENTER

    

TELEPHONE: (212) 713-8749

SELLER:

  

CRESCENT MORTGAGE SERVICES, INC.

ADDRESS:

  

115 PERIMETER CENTER PLACE

    

SUITE 285

    

ATLANTA, GEORGIA 30346

    

ATTENTION: MIKE LEDDY

DATE OF AGREEMENT:

  

JANUARY 31, 2003

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TABLE OF CONTENTS

 

         

Page

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SECTION 1.

  

DEFINITIONS.

  

1

SECTION 2.

  

PROCEEDS FOR PURCHASES OF MORTGAGE LOANS

  

15

SECTION 3.

  

PROCEDURE FOR REPURCHASES OF MORTGAGE LOANS.

  

18

SECTION 4.

  

TERMS OF EACH TRANSACTION.

  

20

SECTION 5.

  

CASH ACCOUNT.

  

20

SECTION 6.

  

SERVICING OF THE MORTGAGE LOANS

  

21

SECTION 7.

  

REMEDIES; MARGIN DEFICITS

  

22

SECTION 8.

  

TRANSFER OF MORTGAGE LOAN BY PURCHASER

  

25

SECTION 9.

  

RECORD TITLE TO MORTGAGE LOANS; INTENT OF PARTIES; SECURITY INTEREST

  

25

SECTION 10.

  

REPRESENTATIONS AND WARRANTIES.

  

25

SECTION 11.

  

COVENANTS OF SELLER

  

29

SECTION 12.

  

PERIODIC DUE DILIGENCE

  

32

SECTION 13.

  

THIRD PARTY SERVICING

  

33

SECTION 14.

  

CONFIDENTIALITY

  

33

SECTION 15.

  

TERM

  

33

SECTION 16.

  

EXCLUSIVE BENEFIT OF PARTIES; ASSIGNMENT

  

34

SECTION 17.

  

AMENDMENTS; WAIVERS; CUMULATIVE RIGHTS

  

34

SECTION 18.

  

EXECUTION IN COUNTERPARTS

  

34

SECTION 19.

  

EFFECT OF INVALIDITY OF PROVISIONS

  

34

SECTION 20.

  

GOVERNING LAW

  

34

SECTION 21.

  

NOTICES

  

34

SECTION 22.

  

ENTIRE AGREEMENT

  

34

SECTION 23.

  

COSTS OF ENFORCEMENT

  

34

SECTION 24.

  

PURCHASER’S APPOINTMENT AS ATTORNEY-IN-FACT

  

35

SECTION 25.

  

SUBMISSION TO JURISDICTION; WAIVERS.

  

36

SECTION 26.

  

CONSTRUCTION

  

37

SECTION 27.

  

EFFECT OF AMENDMENT AND RESTATEMENT.

  

37

 

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SCHEDULES

    

Schedule 1

  

Representations and Warranties regarding Mortgage Loans

Schedule 2

  

Form of Trial Balance Report

EXHIBITS

    

Exhibit A

  

Closing Loan Purchase Detail Fields

Exhibit B

  

Rewarehousing Loan Purchase Detail Fields

Exhibit C

  

Conversion Loan Purchase Detail Fields

Exhibit D

  

Withdrawal/Deposit Notice

Exhibit E

  

Cash Account Wire Instructions

Exhibit F

  

Cash Account Adjustment Notice

Exhibit G

  

[Intentionally Left Blank]

Exhibit H

  

Purchaser’s Wire Instructions to Seller

Exhibit I

  

UCC-1 Financing Statement

Exhibit J

  

Seller’s Delivery Instructions

Exhibit K

  

Seller’s Release

Exhibit L

  

Seller’s Wire Instructions

Exhibit M

  

Warehouse Lender’s Release

Exhibit N

  

Authorized Signatures of Seller

Exhibit O

  

Warehouse Lender’s Wire Instructions

Exhibit P

  

MBS Swap Funding Program Selection Notice

Exhibit Q

  

Request For Mortgage Loan Shipment

Exhibit R

  

MBS Swap Shipment Documents

Exhibit S

  

Form of Closing Instruction Letter Insert

Exhibit T

  

Seller’s Underwriting Guidelines

Exhibit U

  

Form of Opinion

Exhibit V

  

UCC Filing Jurisdictions

Exhibit W

  

Form of Servicer Notice

Exhibit X

  

Form of Covenant Compliance Letter

Exhibit Y

  

Form of Request for Purchase

 

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AMENDED AND RESTATED MORTGAGE LOAN REPURCHASE AGREEMENT

 

This Amended and Restated Mortgage Loan Repurchase Agreement (“Agreement”),
dated as of the date set forth on the cover page hereof, between UBS WARBURG
REAL ESTATE SECURITIES INC. (“Purchaser” or “UBSRES”) and the Seller whose name
is set forth on the cover page hereof (“Seller”).

 

RECITALS

 

WHEREAS, the Purchaser and the Seller are parties to the Mortgage Loan
Repurchase Agreement, dated as of December 24, 1996 (the “Original Repurchase
Agreement”);

 

WHEREAS, pursuant to the Original Repurchase Agreement, Seller may have, in its
sole discretion, offered to sell to Purchaser from time to time Mortgage Loans
(as defined therein), subject to Seller’s obligation to repurchase such Mortgage
Loans in accordance with the terms therein and Purchaser, in its sole
discretion, may have agreed to purchase such Mortgage Loans from Seller in
accordance with the terms and conditions set forth in the Original Repurchase
Agreement.

 

WHEREAS, the Seller and the Purchaser desire to amend and restate the Original
Repurchase Agreement as provided herein;

 

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto hereby agree that the Original
Repurchase Agreement be amended and restated in its entirety as follows:

 

PRELIMINARY STATEMENT

 

Seller is engaged among other pursuits, in the business of originating,
purchasing and selling Mortgage Loans. Purchaser is engaged in, among other
pursuits, the business of purchasing Mortgage Loans.

 

Seller may, in its sole discretion, offer to sell to Purchaser from time to time
Mortgage Loans, subject to Seller’s obligation to repurchase such Mortgage Loans
in accordance with the terms herein and Purchaser, in its sole discretion, may
agree to purchase such Mortgage Loans from Seller in accordance with the terms
and conditions set forth in this Agreement. It is contemplated by the parties
hereto that the Mortgage Loans subject to this Agreement, from time to time,
will become the subject of transactions in which Purchaser purchases such
Mortgage Loans from Seller on a servicing released basis. Seller subsequently
will offer to sell such Mortgage Loans to Purchaser on a servicing released
basis, and Purchaser, pursuant to one of the UBSRES Purchase Programs, may elect
to purchase such Mortgage Loans from Seller.

 

The parties hereto hereby agree as follows:

 

Section 1. Definitions.

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Capitalized terms used but not defined herein shall have the meanings set forth
in the Custodial Agreement. As used in this Agreement, the following terms shall
have the following meanings:

 

“Act of Insolvency”: shall mean, with respect to any party and its Affiliates,
(i) the filing of a petition, commencing, or authorizing the commencement of any
case or proceeding under any bankruptcy, insolvency, reorganization,
liquidation, dissolution or similar law relating to the protection of creditors,
or suffering any such petition or proceeding to be commenced by another which is
consented to, not timely contested or results in entry of an order for relief;
(ii) the seeking the appointment of a receiver, trustee, custodian or similar
official for such party or an Affiliate or any substantial part of the property
of either; (iii) the appointment of a receiver, conservator, or manager for such
party or an Affiliate by any governmental agency or authority having the
jurisdiction to do so; (iv) the making or offering by such party or an Affiliate
of a composition with its creditors or a general assignment for the benefit of
creditors; (v) the admission by such party or an Affiliate of such party of its
inability to pay its debts or discharge its obligations as they become due or
mature; or (vi) that any governmental authority or agency or any person, agency
or entity acting or purporting to act under governmental authority shall have
taken any action to condemn, seize or appropriate, or to assume custody or
control of, all or any substantial part of the property of such party or of any
of its Affiliates, or shall have taken any action to displace the management of
such party or of any of its Affiliates or to curtail its authority in the
conduct of the business of such party or of any of its Affiliates.

 

“Affiliate”: With respect to any Person, any “affiliate” of such Person, as such
term is defined in the Bankruptcy Code.

 

“Agency”: The Government National Mortgage Association (“GNMA”), the Federal
National Mortgage Association (“Fannie Mae”), and the Federal Home Loan Mortgage
Corporation (“Freddie Mac”), as applicable.

 

“Agency Approvals”: Shall have the meaning ascribed thereto in Section
10(a)(xii) of this Agreement.

 

“Agency Eligible Mortgage Loan”: A mortgage loan that is in strict compliance
with the eligibility requirements for swap or purchase by the designated Agency,
under the applicable Agency Guide and/or applicable Agency Program.

 

“Agency Guide”: The GNMA Mortgage-Backed Securities Guide; the Fannie Mae
Selling Guide and the Fannie Mae Servicing Guide; the Freddie Mac Sellers’ and
Servicers’ Guide; as applicable, in each case as such Agency Guide may be
amended from time to time.

 

“Agency Program”: The specific purchase program under the relevant Agency Guide
or as otherwise approved by the Agency.

 

“Assignee”: With respect to this Agreement and any Mortgage Loan, any assignee
of the Purchaser pursuant to a pledge or rehypothecation of the Mortgage Loan.

 

“Asset Value”: With respect to each Mortgage Loan, the lesser of (a) the Market
Value of such Mortgage Loan less the related Discount or (b) the outstanding
principal balance

 

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of such Mortgage Loan less the Discount; provided, that, the Asset Value shall
be deemed to be zero with respect to each Mortgage Loan (1) in respect of which
there is a breach of a representation and warranty set forth in Schedule 1
(assuming each representation and warranty is made as of the date Asset Value is
determined), (2) in respect of which there is a delinquency in the payment of
principal and/or interest which continues for a period in excess of twenty nine
(29) calendar days (without regard to any applicable grace periods), (3) which
has not been repurchased by the Seller by its Scheduled Repurchase Date, or (4)
which has been released from the possession of the Custodian under the Custodial
Agreement to the Seller for a period in excess of ten (10) calendar days;
provided that the Purchaser may, in its sole and absolute discretion, assign a
market value above zero with respect to any Mortgage Loan that would otherwise
be deemed to have an Asset Value of zero.

 

“Authorized Signatory”: An officer of the Seller who is authorized and empowered
to request a purchase of Mortgage Loans by the Purchaser pursuant to a Request
for Purchase, and is indicated on the Authorized Signatories of the Seller
attached hereto as Exhibit N.

 

“Bankruptcy Code”: The United States Bankruptcy Code of 1978, as amended from
time to time.

 

“Business Day”: Any day other than (a) a Saturday, Sunday or other day on which
banks located in the City of New York, New York are authorized or obligated by
law or executive order to be closed, or (b) any day on which UBSRES is closed
for business, provided that notice thereof shall have been given not less than
seven calendar days prior to such day.

 

“Capital Lease Obligations”: For any Person, all obligations of such Person to
pay rent or other amounts under a lease of (or other agreement conveying the
right to use) Property to the extent such obligations are required to be
classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP, and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.

 

“Cash Account”: A separate cash account established and maintained by Seller at
UBSRES under the conditions set forth in Section 5.

 

“Cash Account Adjustment”: An adjustment to the Cash Account Balance pursuant to
a Cash Account Adjustment Notice.

 

“Cash Account Adjustment Notice”: The cash account adjustment notice, in the
form of Exhibit F; to be used by Purchaser to notify Seller of any adjustments
to the Cash Account Balance.

 

“Cash Account Balance”: As of any date, the net amount of funds in the Cash
Account on such date.

 

“Cash Account Interest Accrual”: The simple interest calculation posted on the
last Business Day of each month resulting from the product of each Business
Day’s Cash Account Balance and Cash Account Interest Rate.

 

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“Cash Account Interest Rate”: With respect to each month, the average opening
federal funds rate for such month. The opening federal funds rate on a Business
Day shall be counted as the Cash Account Interest Rate until the next Business
Day.

 

“Cash Account Wire Instructions”: The wire instructions, set forth in a letter
in the form of Exhibit E, to be used for the payment of funds to Seller.

 

“Closing Instruction Letter” shall mean with respect to each Wet Mortgage Loan
which is being originated in part by the proceeds of a Closing Transaction, the
instruction letter of the Seller with respect to such origination which is
acknowledged by the Escrow Agent.

 

“Closing Instruction Letter Insert”: A paragraph in the form of Exhibit S hereto
which shall be inserted into the Closing Instruction Letter.

 

“Closing Loan Purchase Detail”: A loan purchase detail, prepared by Seller and
delivered by Seller to Purchaser via electronic transmission containing all
information specified on Exhibit A (as such information may be amended from time
to time by notice from Purchaser to Seller) in a form acceptable to Purchaser,
regarding the characteristics of a Mortgage Loan being offered for sale by
Seller to Purchaser under a Closing Transaction.

 

“Closing Transaction”: Any sale of a Mortgage Loan by Seller to Purchaser,
structured as either a Wet Funding or a Dry Funding, wherein Purchaser wires the
Disbursement Amount in accordance with the Escrow Agent Standing Wire
Instructions subject to an obligation of Seller to repurchase such Mortgage Loan
pursuant to this Agreement.

 

“Collateral”: Each of the following items or types of property, whether now
owned or hereafter acquired, now existing or hereafter created and wherever
located: the Mortgage Loans, all mortgage loan documents (including, without
limitation, all promissory notes, all servicing records, servicing agreements
and any other collateral pledged or otherwise relating to such Mortgage Loans),
together with all files, documents, instruments, surveys, certificates,
correspondence, appraisals, computer programs, computer storage media,
accounting records and other books and records relating thereto, all mortgage
guaranties and insurance (issued by governmental agencies or otherwise) and any
mortgage insurance certificate or other document evidencing such mortgage
guaranties or insurance relating to any Mortgage Loan, all Servicing Rights
relating to the Mortgage Loans, any servicing accounts established pursuant to
any Servicing Agreement and all amounts on deposit therein, from time to time,
all purchase agreements or other agreements or contracts relating to,
constituting, or otherwise governing, any or all of the foregoing to the extent
they relate to the Mortgage Loans including the right to receive principal and
interest payments with respect to the Mortgage Loans and the right to enforce
such payments, the Cash Account and all monies from time to time on deposit in
the Cash Account, the Custodial Account and all monies from time to time on
deposit in the Custodial Account, all “general intangibles”, “accounts”,
“chattel paper” and “investment property” as defined in the UCC relating to or
constituting any and all of the foregoing, and any and all replacements,
substitutions, distributions on or proceeds of any and all of the foregoing.

 

“Collateral Receipt”: With respect to each Wet Mortgage Loan, the receipt by
Custodian on a Business Day of a Dry Submission Package or Conduit Submission
Package.

 

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“Collateral Receipt Adjustment”: The process initiated by Collateral Receipt
wherein the Pass-Through Rate on a Wet Mortgage Loan is reduced, effective from
the date of Collateral Receipt through one calendar day prior to the Repurchase
Date.

 

“Collateral Receipt Date”: With respect to each Wet Mortgage Loan, the Business
Day on which a Collateral Receipt occurs.

 

“Conduit Funding Program”: A program pursuant to the terms of the Custodial
Agreement and the Amended and Restated Mortgage Loan Purchase Agreement dated as
of the date set forth on the cover sheet thereof, between Seller and Purchaser
as amended from time to time.

 

“Conduit Submission Package”: The documents required to be delivered by Seller
to Custodian under the Conduit Funding Program.

 

“Conversion Loan Purchase Detail”: A loan purchase detail, prepared by Seller
and delivered by Seller to Purchaser via electronic transmission containing the
information set forth on Exhibit C, in a form acceptable to Purchaser, regarding
the characteristics of a Mortgage Loan that is subject to repurchase and that is
subsequently offered to Purchaser under the Conduit Funding Program.

 

“Credit File”: All papers and records of whatever kind or description, whether
developed or originated by Seller or others, required to document or service the
Mortgage Loan; provided however, that such Mortgage Loan papers, documents and
records shall not include any Mortgage Loan papers, documents or records which
are contained in the Dry Submission Package.

 

“Custodial Account”: A separate custodial account, established and maintained by
Seller under the conditions set forth in Section 6(b), for the deposit by Seller
of all collections in respect of a Mortgage Loan that are payable to Purchaser
as the owner of the Mortgage Loan.

 

“Custodial Agreement”: The Amended and Restated Mortgage Loan Custodial
Agreement, dated as of the date set forth on the cover sheet thereof, among
Seller, Purchaser and Custodian, as amended from time to time. Such Amended and
Restated Mortgage Loan Custodial Agreement governs Purchaser’s Whole Loan
Purchase Program and Conduit Funding Program.

 

“Custodial Fee”: With respect to each Repurchase, a fee payable to Purchaser by
Seller in the amount set forth on the related Funding Confirmation, and remitted
to Purchaser on the related Repurchase Date as a component of the related
Repurchase Price.

 

“Custodian”: The custodian named in the Custodial Agreement, and its permitted
successors hereunder.

 

“Defective Mortgage Loan”: A Mortgage Loan that is not in compliance with this
Agreement and/or the Electronic Tracking Agreement, including but not limited to
a Mortgage Loan that is not in compliance with the representations and
warranties set forth on Schedule 1 hereto.

 

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“Desired Funding Date”: The Business Day indicated by the Seller on the Closing
Loan Purchase Detail, on which Seller desires Purchaser to purchase a Mortgage
Loan via a Wet Funding or a Dry Funding or the Business Day indicated by Seller
on the Rewarehousing Loan Purchase Detail, on which Seller desires Purchaser to
purchase a Mortgage Loan via a Dry Funding.

 

“Disbursement Amount”: With respect to a Mortgage Loan, the amount set forth on
the related Closing Loan Purchase Detail or Rewarehousing Loan Purchase Detail
as the “Disbursement Amount”.

 

“Discount”: With respect to each Mortgage Loan, the amount, determined by the
Purchaser in its sole and absolute discretion, set forth on the related Funding
Confirmation as the “Discount.”

 

“Document File”: The Credit File and the Dry Submission Package.

 

“Dry Funding”: Either (i) a Closing Transaction initiated by the delivery by
Seller, via electronic transmission to Purchaser of a Closing Loan Purchase
Detail and the receipt by Custodian of a Dry Submission Package or (ii) a
Rewarehousing Transaction initiated by the delivery by Seller, via electronic
transmission to Purchaser, of a Rewarehousing Loan Purchase Detail, a Warehouse
Lender’s or Seller’s Release and the Custodian’s receipt of a Dry Submission
Package.

 

“Dry Mortgage Loan”: A Mortgage Loan with respect to which (i) Custodian has
received a Dry Submission Package and (ii) no Repurchase has occurred.

 

“Dry Submission Package”: The documents required to be delivered by Seller to
Custodian pursuant to the Custodial Agreement.

 

“Due Date”: The day of the month on which the Monthly Payment is due on the
Mortgage Loan.

 

“Electronic Agent”: MERCORP, INC, and its successors in interest.

 

“Electronic Tracking Agreement”: The Electronic Tracking Agreement, dated as of
[                    ], 2003, among Purchaser, Seller, MERSCORP, Inc. and
Mortgage Electronic Registration Systems, Inc.; provided that if no Mortgage
Loans are or will be MERS Designated Mortgage Loans, all references herein to
the Electronic Tracking Agreement shall be disregarded.

 

“Escrow Agent”: The agent appointed by the Title Insurance Company to administer
the closing of a Mortgage Loan.

 

“Escrow Agent Standing Wire Instructions”: The wire instructions of the Escrow
Agent set forth in the applicable Closing Loan Purchase Detail, from Seller to
Purchaser for use when Purchaser wires Disbursement Amounts for Wet Fundings and
Dry Fundings structured as Closing Transactions.

 

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“Event of Default”: The occurrence of any of the following events: (i) an Act of
Insolvency with respect to Seller or Parent Company; (ii) any representation or
warranty made by Seller hereunder shall have been incorrect or untrue in any
material respect when made or when deemed to have been made; (iii) Seller shall
fail to perform, or shall admit to Purchaser its inability to, or its intention
not to, perform any of its obligations hereunder or under the Electronic
Tracking Agreement; (iv) an event or events shall have occurred resulting in the
effective absence of a “repo market” or comparable “lending market” for
financing debt obligations secured by mortgage loans or securities or an event
or events shall have occurred resulting in the Purchaser not being able to
finance any Mortgage Loans through the “repo market” or “lending market” with
traditional counterparties at rates which would have been reasonable prior to
the occurrence of such event or events; (v) an event or events shall have
occurred resulting in the effective absence of a “securities market” for
securities backed by mortgage loans or an event or events shall have occurred
resulting in the Purchaser not being able to sell securities backed by mortgage
loans at prices which would have been reasonable prior to such event or events;
(vi) there shall have occurred a material adverse change in the “repo market” or
comparable “lending market” or in the financial condition of the Purchaser which
effects (or can reasonably be expected to effect) materially and adversely the
ability of the Purchaser to fund its obligations under this Agreement; (vii) the
Seller or any of the Seller’s Affiliates shall be in default beyond any
applicable grace period under any note, indenture, loan agreement, guaranty,
swap agreement or any other contract to which it is a party; (viii) the Seller
shall fail to comply with the requirements of any of Section 7(h), Sections
11(a) through 11(c) (inclusive), Section 11(e), Section 11(h) through 11(j)
(inclusive) or Section 11(n); (viii)(a) the Seller shall fail to comply with the
requirements of any of Section 11(k) through Section 11(m) (inclusive) or (b)
the Seller shall fail to comply with the requirements on any other subsection in
Section 11 (other than those specifically enumerated in preceding clause (vii)
or (viii)(a)), and such default shall continue unremedied for a period of three
Business Days; (ix) if the Purchaser has purchased MERS Designated Mortgage
Loans, the Electronic Tracking Agreement has for whatever reason been terminated
or ceases to be in full force and effect and the Purchaser (or the Custodian as
its designee) shall not have received an assignment of mortgage with respect to
each MERS Designated Mortgage Loan, in blank, in recordable form, but
unrecorded; (x) any materially adverse change in the Property, business,
financial condition or prospects of the Seller or any of its Affiliates shall
occur, in each case as determined by the Purchaser in its sole discretion, or
any other condition shall exist which, in the Purchaser’s sole discretion,
constitutes a material impairment of the Seller’s ability to perform its
obligations under this Agreement or any other document in connection herewith;
or (xi) the discovery by the Purchaser of a condition or event which existed at
or prior to the execution hereof and which the Purchaser, in its sole
discretion, determines materially and adversely affects: (a) the condition
(financial or otherwise) of the Seller, its Subsidiaries or Affiliates; or (b)
the ability of either Seller or Purchaser to fulfill its respective obligations
under this Agreement.

 

“FDIC”: The Federal Deposit Insurance Corporation or any successor thereto.

 

“Freddie Mac”: Freddie Mac or any successor thereto.

 

“Fannie Mae”: Fannie Mae or any successor thereto.

 

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“Funding Confirmation”: With respect to each Mortgage Loan purchased by
Purchaser from Seller via a single wire funds transaction on a particular
Business Day, the trade confirmation from Purchaser to Seller confirming
Seller’s obligation to repurchase such Mortgage Loan from Purchaser by the
Scheduled Repurchase Date.

 

“GAAP”: Generally accepted accounting principles as in effect from time to time
in the United States.

 

“GMNA”: The Government National Mortgage Association or any successor thereto.

 

“Guarantee”: As to any Person, any obligation of such Person directly or
indirectly guaranteeing any Indebtedness of any other Person or in any manner
providing for the payment of any Indebtedness of any other Person or otherwise
protecting the holder of such Indebtedness against loss (whether by virtue of
partnership arrangements, by agreement to keep-well, to purchase assets, goods,
securities or services, or to take-or-pay or otherwise); provided that the term
“Guarantee” shall not include (i) endorsements for collection or deposit in the
ordinary course of business, or (ii) obligations to make servicing advances for
delinquent taxes and insurance or other obligations in respect of a Mortgaged
Property, to the extent required by the Purchaser. The amount of any Guarantee
of a Person shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Guarantee is made or,
if not stated or determinable, the maximum reasonably anticipated liability in
respect thereof as determined by such Person in good faith. The terms
“Guarantee” and “Guaranteed” used as verbs shall have correlative meanings.

 

“Incremental Pass-Through Rate”: The amount by which the Pass-Through Rate
increases upon the occurrence of any event giving Purchaser the right to elect a
remedy pursuant to Section 7, which amount shall be set forth in the applicable
Funding Confirmation as the “Incremental Pass-Through Rate”.

 

“Indebtedness”: For any Person: (a) obligations created, issued or incurred by
such Person for borrowed money (whether by loan, the issuance and sale of debt
securities or the sale of Property to another Person subject to an understanding
or agreement, contingent or otherwise, to repurchase such Property from such
Person); (b) obligations of such Person to pay the deferred purchase or
acquisition price of Property or services, other than trade accounts payable
(other than for borrowed money) arising, and accrued expenses incurred, in the
ordinary course of business so long as such trade accounts payable are payable
within 90 days of the date the respective goods are delivered or the respective
services are rendered; (c) Indebtedness of others secured by a Lien on the
Property of such Person, whether or not the respective Indebtedness so secured
has been assumed by such Person; (d) obligations (contingent or otherwise) of
such Person in respect of letters of credit or similar instruments issued or
accepted by banks and other financial institutions for account of such Person;
(e) Capital Lease Obligations of such Person; (f) obligations of such Person
under repurchase agreements, sale/buy back agreements or like arrangements; (g)
Indebtedness of others Guaranteed by such Person; (h) all obligations of such
Person incurred in connection with the acquisition or carrying of fixed assets
by such Person; and (i) Indebtedness of general partnerships of which such
Person is a general partner.

 

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“Interest Rate Protection Agreement” shall mean, with respect to any or all of
the Mortgage Loans, any short sale of US Treasury securities, or futures
contracts, or options related contracts, or interest rate swap, cap or collar
agreement or similar arrangement providing for protection against fluctuations
in interest rates or the exchange of nominal interest obligations either
generally or under specific contingencies and acceptable to Purchaser.

 

“Interim Funder”: With respect to each MERS Designated Mortgage Loan, the Person
named on the MERS® System as the interim funder pursuant to the MERS Procedures
Manual.

 

“Investor”: With respect to each MERS Designated Mortgage Loan, the Person named
on the MERS® System as the investor pursuant to the MERS Procedures Manual.

 

“Lien”: Any mortgage, lien, pledge, charge, security interest or similar
encumbrance.

 

“Losses”: Any and all losses, claims, damages, liabilities or expenses
(including reasonable attorneys’ fees) incurred by any person specified;
provided, however, that “Losses” shall not include any losses, claims, damages,
liabilities or expenses which would have been avoided had such person taken
reasonable actions to mitigate such losses, claims, damages, liabilities or
expenses.

 

“Market Value”: As of any date in respect of a Mortgage Loan, the price at which
such Mortgage Loan could readily be sold as determined by Purchaser in its sole
discretion, which price may be determined to be zero. Purchaser’s good faith
determination of Market Value shall be conclusive upon the parties.

 

“MBS Swap Custodial Agreement”: The custodial agreement, dated as of the date
set forth on the cover sheet thereof, among Seller, Purchaser and custodian as
amended from time to time. Such custodial agreement governs Purchaser’s MBS Swap
Funding Program.

 

“MBS Swap Funding Program”: A program pursuant to the terms of (i) the MBS Swap
Mortgage Loan Participation Agreement dated as of the date set forth on the
cover sheet thereof, among Seller and Purchaser as amended from time to time and
(ii) the MBS Swap Custodial Agreement.

 

“MBS Swap Funding Program Selection Notice”: A notification that identifies
Mortgage Loans intended for the MBS Swap Funding Program provided by Seller to
Purchaser either (i) on the Closing Loan Purchase Detail or Rewarehousing Loan
Purchase Detail via the “MBS Swap Funding Program Designation” field or (ii) via
a facsimile transmission in the form of Exhibit P, received by Purchaser prior
to the Scheduled Repurchase Date, for any Mortgage Loans previously purchased
without the “MBS Swap Funding Program Designation”.

 

“MBS Swap Shipment Documents”: With respect to each Mortgage Loan for which an
MBS Swap Funding Program Selection Notice has been provided, the documents
required, as listed in Exhibit R, to be received by Purchaser from Seller via
facsimile transmission, prior to Purchaser’s carrying out Seller’s instructions
for the Request for Mortgage Loan Shipment.

 

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“MBS Swap Submission Package”: The documents required to be provided by Seller
to Purchaser with respect to each purchase under the MBS Swap Funding Program,
as described in the MBS Swap Mortgage Loan Participation Agreement and MBS Swap
Custodial Agreement.

 

“MERS Designated Mortgage Loan”: Mortgage Loans for which (a) the Seller has
designated or will designate MERS as, and has taken or will take such action as
is necessary to cause MERS to be, the mortgagee of record, as nominee for the
Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor and Interim Funder on
the MERS® System.

 

“MERS Procedure Manual”: The MERS Procedures Manual attached as Exhibit B to the
Electronic Tracking Agreement, as it may be amended, supplemented or otherwise
modified from time to time.

 

“MERS Report”: The schedule listing MERS Designated Mortgage Loans and other
information prepared by the Electronic Agent pursuant to the Electronic Tracking
Agreement.

 

“MERS® System”: The Electronic Agent’s mortgage electronic registry system, as
more particularly described in the MERS Procedures Manual.

 

“Monthly Payment”: The scheduled monthly payment of principal and interest on a
Mortgage Loan.

 

“Moody’s”: Moody’s Investors Service, Inc.

 

“Mortgage”: The mortgage, deed of trust or other instrument creating a lien on
an estate in fee simple in real property securing a Mortgage Note.

 

“Mortgage Loan”: A one-to-four family residential mortgage loan that is
underwritten in accordance with the Underwriting Guidelines and is subject to
this Agreement.

 

“Mortgage Note”: The note or other evidence of the indebtedness of a Mortgagor
or secured by a Mortgage.

 

“Mortgaged Property”: The property subject to the lien of the Mortgage securing
a Mortgage Note.

 

“Mortgagor”: The obligor on a Mortgage Note.

 

“NCUA”: The National Credit Union Administration, or any successor thereto.

 

“Net Income”: For any period, the net income of the Seller for such period as
determined in accordance with GAAP.

 

“Note Rate”: The rate of interest borne by a Mortgage Note.

 

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“Original Repurchase Agreement”: Shall have the meaning assigned to such term in
the recitals hereof.

 

“OTS”: The Office of Thrift Supervision, or any successor thereto.

 

“Parent Company”: A corporation or other entity owning at least 50% of the
outstanding shares of voting stock of Seller.

 

“Pass-Through Rate”: With respect to each Mortgage Loan, the rate at which
interest is passed through to Purchaser which initially shall be the rate of
interest specified on a Funding Confirmation as the “Pass-Through Rate”.

 

“Person”: Any individual, corporation, company, voluntary association,
partnership, joint venture, limited liability company, trust, unincorporated
association or government (or any agency, instrumentality or political
subdivision thereof).

 

“Property”: Any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible.

 

“Purchase Date”: With respect to a Mortgage Loan, the date on which Purchaser
purchases such Mortgage Loan from Seller.

 

“Purchase Price”: With respect to each Mortgage Loan, an amount equal to the
face amount of the Mortgage Loan less the Discount.

 

“Purchaser”: UBS Warburg Real Estate Securities Inc. and its successors.

 

“Purchaser’s Wire Instructions”: The wire instructions, set forth in a notice
delivered by Purchaser to Seller in the form of Exhibit H, containing the
information to be used for the payment of all amounts due and payable to
Purchaser hereunder.

 

“Repurchase”: With respect to any Mortgage Loan, the transaction by which the
Seller remits the Repurchase Price to Purchaser and simultaneously Purchaser
purchases the Mortgage Loan with a netting of funds resulting, governed by the
terms of the applicable UBSRES Purchase Program.

 

“Repurchase Date”: With respect to any Mortgage Loan, the date that Seller
remits the Repurchase Price to Purchaser.

 

“Repurchase Price”: With respect to each Mortgage Loan, an amount equal to the
Purchase Price plus the Custodial Fee plus the product of the Purchase Price of
the Mortgage Loan, the Pass-Through Rate and the number of calendar days from
the Purchase Date to the Repurchase Date divided by 360.

 

“Request for Mortgage Loan Shipment”: Notification provided by Seller to
Purchaser via facsimile transmission in the form of Exhibit Q, which presents
Mortgage Loans to be delivered by Purchaser to the custodian as set forth on the
cover page of the MBS Swap Funding Program Custodial Agreement or under the
appropriate circumstances, Freddie Mac.

 

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“RESPA”: Real Estate Settlement Procedures Act, as amended from time to time.

 

“Rewarehousing Loan Purchase Detail”: A loan purchase detail, prepared and
submitted by Seller to Purchaser via electronic transmission containing the
information specified on Exhibit B (as such information may be amended from time
to time by notice from Purchaser to Seller) in a form acceptable to Purchaser,
regarding the characteristics of a Mortgage Loan being offered for sale by,
Seller to Purchaser under a Rewarehousing Transaction.

 

“Rewarehousing Transaction”: Any sale of a Mortgage Loan by Seller to Purchaser
structured as a Dry Funding wherein Purchaser wires the Disbursement Amount
pursuant to the Warehouse Lender’s Wire Instructions or the Seller’s Wire
Instructions, as applicable, subject to an obligation of Seller to repurchase
such Mortgage Loan pursuant to this Agreement.

 

“RTC”: The Resolution Trust Corporation or any successor thereto.

 

“S&P”: Standard and Poor’s Ratings Services, a division of McGraw-Hill
Companies.

 

“Scheduled Collateral Receipt Date”: With respect to each Wet Mortgage Loan, the
Business Day, as set forth on the Funding Confirmation as the “Collateral
Receipt Date”, by which a Collateral Receipt is required to occur, such date to
be within five (5) Business Days of a Wet Funding structured as a Closing
Transaction.

 

“Scheduled Repurchase Date”: With respect to each Mortgage Loan, the Business
Day as set forth on the Funding Confirmation as the “Repurchase Date”, by which
a repurchase is required to occur, such date to be within five (5) Business Days
after the Purchase Date with respect to a Wet Mortgage Loan unless such Mortgage
Loan has become a Dry Mortgage Loan prior to such fifth Business Day, (ii)
within five (5) Business Days after the Collateral Receipt Date with respect to
a Dry Mortgage Loan or (iii) within five (5) Business Days after the Purchase
Date with respect to a Dry Mortgage Loan for which Seller has provided Purchaser
with an MBS Swap Funding Program Selection Notice, unless, in any case, such
date has been accelerated in connection with either an Event of Default pursuant
to Section 7(a), a Defective Mortgage Loan pursuant to Section 7(b) or a Margin
Deficit pursuant to Section 7(h).

 

“Seller”: The Seller whose name is set forth on the cover page hereof, and its
permitted successors hereunder.

 

“Seller’s Delivery Instructions”: With respect to each Mortgage Loan for which
Seller has remitted the Repurchase Price to Purchaser and which Purchaser
concurrently does not elect to purchase under a UBSRES Purchase Program, the
notification provided by Seller to Purchaser via facsimile transmission in the
Form of Exhibit J, instructing Purchaser to deliver the Dry Submission Package
for such Mortgage Loan to the indicated address.

 

“Seller’s Release”: A letter in the form of Exhibit K, delivered by Seller when
no Warehouse Lender has an interest in a Mortgage Loan, conditionally releasing
all of Seller’s interest in a Mortgage Loan upon receipt of payment by Seller.

 

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“Seller’s Wire Instructions”: The wire instructions set forth in a letter in the
form of Exhibit L, to be used for the payment of funds to Seller when no
Warehouse Lender has an interest in the Mortgage Loans to which such payment
relates.

 

“Servicer”: Shall have the meaning provided in Section 13 hereof.

 

“Servicing Agreement”: Shall have the meaning provided in Section 13 hereof.

 

“Servicing Rights”: Any and all of the following: (a) any and all rights to
service the Mortgage Loans; (b) any payments to or monies received by Seller or
any other Person for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of Seller or any
other Person thereunder; (e) escrow payments or other similar payments with
respect to the Mortgage Loans and any amounts actually collected by Seller or
any other Person with respect thereto; and (f) all accounts and other rights to
payment related to the Mortgage Loans.

 

“Submission Package”: A Conduit Submission Package, a Dry Submission Package or
a MBS Swap Submission Package, as applicable.

 

“Subsidiary”: With respect to any Person, any corporation, partnership or other
entity of which at least a majority of the securities or other ownership
interests having by the terms thereof ordinary voting power to elect a majority
of the board of directors or other persons performing similar functions of such
corporation, partnership or other entity (irrespective of whether or not at the
time securities or other ownership interests of any other class or classes of
such corporation, partnership or other entity shall have or might have voting
power by reason of the happening of any contingency) is at the time directly or
indirectly owned or controlled by such Person or one or more Subsidiaries of
such Person or by such Person and one or more Subsidiaries of such Person.

 

“Successor Servicer”: An entity designated by Purchaser, in conformity with
Section 7, to replace Seller as servicer for Purchaser.

 

“Supplemental Amount”: With respect to each Mortgage Loan, an amount equal to
the Disbursement Amount less the Purchase Price.

 

“Tangible Net Worth”: As of a particular date,

 

(i) all amounts which would be included under capital on a balance sheet of the
Seller at such date, determined in accordance with GAAP, less

 

(ii) amounts owing to Seller from Affiliates, and

 

(iii) intangible assets.

 

“Title Insurance Company”: A title insurance company acceptable to Purchaser in
its sole discretion.

 

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“Total Indebtedness”: For any period, the aggregate Indebtedness of Seller
during such period less the amount of any nonspecific balance sheet reserves
maintained in accordance with GAAP.

 

“Transaction”: Any sale of a Mortgage Loan by Seller to Purchaser subject to an
obligation of Seller to repurchase such Mortgage Loan pursuant to a Funding
Confirmation in accordance with this Agreement.

 

“UBSRES Purchase Program”: Purchaser’s Conduit Funding Program or MBS Swap
Funding Program as applicable.

 

“UCC”: The Uniform Commercial Code, as enacted in each applicable state.

 

“Underwriting Guidelines”: The underwriting guidelines delivered by Seller to
Purchaser on or prior to the date hereof and as may be supplemented from time to
time thereafter, a copy of which is attached hereto as Exhibit T.

 

“Warehouse Lender”: Any lender providing financing to Seller in any fractional
amount for the purpose of originating or purchasing Mortgage Loans, which leader
has a security interest in such Mortgage Loans as collateral for the obligations
of Seller to such lender.

 

“Warehouse Lender’s Release”: A letter in the form of Exhibit M from a Warehouse
Lender to Purchaser, conditionally releasing all of Warehouse Lender’s right,
title and interest in certain Mortgage Loans identified therein upon receipt of
payment by Warehouse Lender.

 

“Warehouse Lender’s Wire Instructions”: The wire instructions set forth in a
letter in the form of Exhibit O, from a Warehouse Lender who has an interest in
the Mortgage Loans to which such payment relates.

 

“Wet Funding”: A Closing Transaction initiated by the delivery by Seller, either
via electronic or facsimile transmission to Purchaser, of a Closing Loan
Purchase Detail and a pledge by Seller to Purchaser to deliver to Custodian a
Dry Submission Package or Conduit Submission Package by the Scheduled Collateral
Receipt Date.

 

“Wet Mortgage Loan”: A Mortgage Loan for which Custodian on behalf of Purchaser,
does not have physical possession of the related complete Dry Submission Package
and which Seller has agreed to pledge to Purchaser all right, title and interest
in, to and under such Mortgage Loan, free and clear of all liens, pledges,
charges, encumbrances or security interests of any nature.

 

“Whole Loan Purchase Program”: A program pursuant to the terms of the Custodial
Agreement and this Agreement.

 

“Withdrawal/Deposit Notice”: A notice, substantially in the form of Exhibit D,
delivered by Seller to Purchaser, from time to time, in connection with
withdrawals from and deposits to the Cash Account,

 

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“Wire Fee”: For each disbursement relating to a Closing Transaction, a fee
payable to Purchaser by Seller as set forth in the Funding Confirmation.

 

Section 2. Proceeds for Purchases of Mortgage Loans.

 

(a) General Procedures for Purchases of Mortgage Loans.

 

(1) Pursuant to either a Wet Funding or a Dry Funding, Purchaser may, in its
sole discretion, from time to time, purchase one or more Mortgage Loans from
Seller on a “servicing released” basis subject to an obligation of Seller to
repurchase such Mortgage Loans and subsequently to offer to sell such Mortgage
Loans to Purchaser pursuant to one of the UBSRES Purchase Programs. Seller shall
be deemed to make, and hereby makes, for the benefit of Purchaser, as of the
applicable dates specified in Section 10, the representations and warranties set
forth on Schedule 1 hereto in respect of each such Mortgage Loan.

 

(2) Notwithstanding the satisfaction by Seller of the conditions specified in
this Section, this is not a committed facility, Purchaser is not obligated to
purchase any Mortgage Loan offered to it hereunder and the decision of Purchaser
to purchase such Mortgage Loan shall be at Purchaser’s sole discretion. In the
event that Purchaser elects to reject a Mortgage Loan offered by Seller for
purchase by Purchaser in a Wet Funding or a Dry Funding for any reason and/or
does not transmit the Disbursement Amount, any Dry Submission Package delivered
to Custodian in anticipation of such purchase shall be returned by Custodian in
accordance with the terms of the Custodial Agreement.

 

(b) Specific Procedures for Purchases of Mortgage Loans related to Wet Fundings.

 

(1) Prior to Purchaser’s election to purchase any Mortgage Loan pursuant to a
Wet Funding, Purchaser shall have received from Seller (i) a Closing Loan
Purchase Detail in electronic format and (ii) a Request to Purchase, in the form
attached hereto as Exhibit Y, signed by an Authorized Signatory of the Seller,
and (iii) evidence that the Seller’s Cash Account Balance is not less than the
sum of the Supplemental Amount plus the Wire Fee. The terms and conditions of
each such purchase shall be set forth in this Agreement and in the applicable
Funding Confirmation.

 

(2) If Purchaser elects to purchase any Mortgage Loan pursuant to a Wet Funding,
Purchaser shall (i) withdraw the Supplemental Amount, if any, and the Wire Fee
from the Cash Account and (ii) pay the Disbursement Amount for such Mortgage
Loans to the Escrow Agent by wire transfer of immediately available funds in
accordance with the Escrow Agent Standing Wire Instructions.

 

(3) Prior to payment of the Disbursement Amount by the Purchaser to the Escrow
Agent with respect to the initial Wet Funding, Purchaser has obtained

 

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confirmation from the receiving bank that the information pertaining to it on
the Escrow Agent Standing Wire Instructions is accurate.

 

(4) With respect to each Wet Funding, simultaneously with the payment by
Purchaser of the Disbursement Amount for a Mortgage Loan in accordance with the
Escrow Agent Standing Wire Instructions, (i) Seller hereby conveys to Purchaser
all of Seller’s right, title and interest in, to and under such Mortgage Loan
(including, without limitation, Servicing Rights with respect thereto), free and
clear of all liens, pledges, charges, encumbrances or security interests of any
nature, and (ii) Seller hereby covenants to cause to occur a Collateral Receipt
by the Scheduled Collateral Receipt Date and to provide Purchaser with a
Conversion Loan Purchase Detail for any Collateral Receipt relating to a Conduit
Submission Package.

 

(5) With respect to each Wet Funding, if by the Scheduled Collateral Receipt
Date (i) a Collateral Receipt has occurred and (ii) Seller is not in breach of
this Agreement, the Electronic Tracking Agreement or the Custodial Agreement
then (a) with respect to any Collateral Receipt containing a Dry Submission
Package, a Collateral Receipt Adjustment will occur and (b) with respect to any
Collateral Receipt containing a Conduit Submission Package a Repurchase will
occur. If a Collateral Receipt does not occur by the Scheduled Collateral
Receipt Date Purchaser may elect a remedy pursuant to Section 7 including,
without limitation, the application of an Incremental Pass-Through Rate.

 

(c) Specific Procedures for Purchases of Mortgage Loans related to Dry Fundings
structured as Closing Transactions.

 

(1) Prior to Purchaser’s election to purchase any Mortgage Loan pursuant to a
Dry Funding structured as a Closing Transaction, Purchaser shall have received
from Seller (i) a Closing Loan Purchase Detail in electronic format, (ii) a
Request to Purchase, in the form attached hereto as Exhibit Y, signed by an
Authorized Signatory of the Seller, (iii) a MERS Report reflecting the Purchaser
as Investor or Interim Funder for each MERS Designated Loan, (iv) evidence that
the Seller’s Cash Account Balance is not less than the sum of the Supplemental
Amount plus the Wire Fee and (v) evidence that Custodian has received all
applicable documents required by Section 2 of the Custodial Agreement. The terms
and conditions of each such purchase shall be set forth in this Agreement and in
the applicable Funding Confirmation.

 

(2) If Purchaser elects to purchase any Mortgage Loan pursuant to a Dry Funding
structured as a Closing Transaction, Purchaser shall (i) withdraw the
Supplemental Amount, if any, and the Wire Fee from the Cash Account and (ii) pay
the Disbursement Amount for such Mortgage Loans to the Escrow Agent by wire
transfer of immediately available funds in accordance with the Escrow Agent
Standing Wire Instructions.

 

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(3) Prior to payment of the Disbursement Amount by the Purchaser to the Escrow
Agent with respect to the initial Dry Funding, Purchaser has obtained
confirmation from the receiving bank that the information pertaining to it on
the Escrow Agent Standing Wire Instructions is accurate.

 

(4) With respect to each Dry Funding structured as a Closing Transaction,
simultaneously with the payment by Purchaser of the Disbursement Amount for a
Mortgage Loan in accordance with the Escrow Agent Standing Wire Instructions,
Seller hereby conveys to Purchaser all of Seller’s right, title and interest in,
to and under such Mortgage Loan (including, without limitation, Servicing Rights
with respect thereto), free and clear of all liens, pledges, charges,
encumbrances or security interests of any nature.

 

(5) With respect to each Dry Funding structured as a Closing Transaction, if a
Repurchase has not occurred by the Scheduled Repurchase Date and if Seller has
not repurchased the related Mortgage Loan(s), Purchaser may elect a remedy
pursuant to Section 7 including, without limitation, the application of an
Incremental Pass-Through Rate.

 

(d) Specific Procedures for Purchases of Mortgage Loans related to Dry Fundings
structured as Rewarehousing Transactions.

 

(1) Prior to Purchaser’s election to purchase any Mortgage Loan pursuant to a
Dry Funding structured as a Rewarehousing Transaction, Purchaser shall have
received from Seller (i) a Rewarehousing Loan Purchase Detail in electronic
format and (ii) a Request to Purchase, in the form attached hereto as Exhibit Y,
signed by an Authorized Signatory of the Seller, (iii) an original of a
Warehouse Lender’s Release or Seller’s Release, as applicable, (iv) a MERS
Report reflecting the Purchaser as Investor or Interim Funder for each MERS
Designated Loan, (v) evidence that the Seller’s Cash Account Balance is not less
than the sum of the Supplemental Amount plus the Wire Fee and (vi) evidence that
the Custodian has received all applicable documents required by Section 2 of the
Custodial Agreement. The terms and conditions of each such purchase shall be set
forth in this Agreement and in the applicable Funding Confirmation.

 

(2) If Purchaser elects to purchase any Mortgage Loan pursuant to a Dry Funding
structured as a Rewarehousing Transaction, Purchaser shall (i) withdraw the
Supplemental Amount and the Wire Fee, in each case if any, from the Cash Account
and (ii) pay the Disbursement Amount for such Mortgage Loans to the Warehouse
Lender or Seller, as applicable, by wire transfer of immediately available funds
in accordance with the Warehouse Lender’s Wire Instructions or the Seller’s Wire
Instructions, as applicable.

 

(3) With respect to each Dry Funding structured as a Rewarehousing Transaction,
simultaneously with the payment by Purchaser of the Disbursement Amount for a
Mortgage Loan, in accordance with the Warehouse Lender’s Wire Instructions or
Seller’s Wire Instructions, as applicable, Seller hereby conveys to

 

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Purchaser all of Seller’s right, title and interest in, to and under such
Mortgage Loan (including, without limitation, Servicing Rights with respect
thereto), free and clear of all liens, pledges, charges, encumbrances or
security interests of any nature.

 

(4) With respect to each Dry Funding structured as a Rewarehousing Transaction,
if a Repurchase has not occurred by the Scheduled Repurchase Date and if Seller
has not repurchased the related Mortgage Loan(s), Purchaser may elect a remedy
pursuant to Section 7 including the application of an Incremental Pass-Through
Rate.

 

Section 3. Procedure for Repurchases of Mortgage Loans.

 

(a) Prior to Seller’s repurchase of any Mortgage Loan that Seller intends to
subsequently offer for sale to Purchaser under the Conduit Funding Program and
at least five Business Days prior to Seller’s repurchase of any Mortgage Loan
that Seller intends to offer for sale to Purchaser under the MBS Swap Funding
Program, all agreements related to the applicable UBSRES Purchase Program must
be executed by the Seller, the Purchaser and where applicable the Custodian, and
all requirements of such agreements must be satisfied as a condition precedent
to the following:

 

(i) For Mortgage Loans that Seller intends to repurchase and offer to Purchaser
under the Conduit Purchase Program, the following must occur on or before the
Scheduled Repurchase Date:

 

(1) Seller shall transmit electronically a Conversion Loan Purchase Detail
containing all information set forth on Exhibit C hereto to Purchaser and
Custodian shall have received all applicable documents required by Section 2 of
the Custodial Agreement to be in a Conduit Submission Package;

 

(2) Seller shall remit the Repurchase Price to Purchaser and Purchaser shall
assign, transfer and convey to Seller all of Purchaser’s right, title and
interest in, to and under such Mortgage Loan, free and clear of all liens,
pledges, charges, claims, encumbrances or security interests of any nature; and

 

(3) Purchaser shall remit the Purchase Price to Seller pursuant to, and to the
extent provided for under, the terms of the Conduit Funding Program and Seller
shall assign, transfer and convey to Purchaser pursuant to the applicable UBSRES
Purchase Program all of Seller’s right, title and interest in, to and under such
Mortgage Loan, free and clear of all liens, pledges, charges, claims,
encumbrances or security interests of any nature.

 

The payment of funds pursuant to clauses (2) and (3) above shall be netted.

 

(ii) For Mortgage Loans that Seller intends to repurchase and subsequently offer
for sale to Purchaser under the MBS Swap Funding Program the following must
occur on or before the Scheduled Repayment Date:

 

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(1) Seller shall transmit to Purchaser, via a facsimile transmission, the
applicable MBS Swap Shipment Documents at least five (5) Business Days before
the Scheduled Repurchase Date;

 

(2) Purchaser shall deliver to the Custodian a Request for Mortgage Loan
Shipment setting for the Mortgage Loans to be shipped and the location to which
such Mortgage Loans shall be delivered via overnight courier;

 

(3) Seller shall deliver to Purchaser, via overnight courier, the related MBS
Swap Submission Package;

 

(4) Upon Purchaser’s review of the MBS Swap Submission Package and election to
purchase such Mortgage Loans, Seller shall remit the Repurchase Price to
Purchaser and Purchaser shall assign, transfer and convey to Seller all of
Purchaser’s right, title and interest in, to and under such Mortgage Loan, free
and clear of all liens, pledges, charges, claims, encumbrances or security
interests of any nature; and

 

(5) Purchaser shall remit the purchase price to Seller pursuant to, and to the
extent provided for under, the terms of the MBS Swap Purchase Program and Seller
shall assign, transfer and convey to Purchaser pursuant to the UBSRES Purchase
Program all of Seller’s right, title and interest in, to and under such Mortgage
Loan, free and clear of all liens, pledges, charges, claims, encumbrances or
security interests of any nature.

 

The payment of funds pursuant to clauses (4) and (5) above shall be netted.

 

(b) With respect to any Wet Mortgage Loan or Dry Mortgage Loan, if Seller has
provided Purchaser with an MBS Swap Funding Program Selection Notice and Seller,
subsequent to such delivery and subsequent to the Scheduled Repurchase Date for
such Mortgage Loan, provides Purchaser with a Conversion Loan Purchase Detail
and a corresponding Conduit Submission Package, then Purchaser may elect a
remedy pursuant to Section 7 and may retroactively apply an Incremental
Pass-Through Rate for such Mortgage Loan for the period from the Scheduled
Repurchase Date through one day prior to the Repurchase Date.

 

(c) With respect to each Mortgage Loan, on either the Scheduled Collateral
Receipt Date or the Scheduled Repurchase Date, if Seller has not satisfied the
requirements of this Agreement or Purchaser has elected not to purchase such
Mortgage Loan:

 

(i) the Pass-Through Rate shall increase by the Incremental Pass-Through Rate;

 

(ii) the Seller shall remit the Repurchase Price to Purchaser and Purchaser
shall assign, transfer and convey to Seller all of Purchaser’s right, title and
interest in, to and under such Mortgage Loan, free and clear of all liens,
pledges, charges, claims, encumbrances or security interests of any nature; and

 

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(iii) upon receipt of the Repurchase Price and Seller’s Delivery Instructions
from Seller, Purchaser shall direct Custodian to deliver the Dry Submission
Package or Conduit Submission Package related to such Mortgage Loan pursuant to
the Seller’s Delivery Instructions.

 

Section 4. Terms of Each Transaction.

 

(a) The obligations of the parties hereto shall, with respect to each
Transaction, begin on a Purchase Date and terminate on the Repurchase Date or on
the satisfaction by Seller of its obligations pursuant to Section 7.

 

(b) The terms and conditions of each Transaction, including, without limitation,
the Purchase Date, the Scheduled Repurchase Date, the Mortgage Loan subject
thereto, the Purchase Price, the Pass-Through Rate, the Incremental Pass-Through
Rate, the Scheduled Collateral Receipt Date for Wet Fundings only, the Custodial
Fee and, if applicable, the Wire Fee, shall be set forth in the related Funding
Confirmation. Each Funding Confirmation shall be deemed to be controlling as to
the related terms and provisions of the purchase of a Mortgage Loan, absent
manifest error, without regard to any other oral or written communication
between Purchaser and Seller with respect to the purchase of such Mortgage Loan.
With respect to the purchase or repurchase of a Mortgage Loan, in the event of
any conflict between the terms and the provisions of this Agreement and the
terms and provisions of the related Funding Confirmation, the terms and
provisions of the related Funding Confirmation will prevail over the terms and
provisions of this Agreement.

 

Section 5. Cash Account.

 

(a) Seller hereby authorizes and directs Purchaser to create the Cash Account.
The Cash Account shall be held by Purchaser for Seller subject to the terms and
conditions of this Agreement. Purchaser shall notify Seller, via electronic or
facsimile transmission, of the Cash Account Balance on each Business Day when
the Cash Account Balance is greater than zero and on each Business Day on which
a Transaction occurs hereunder.

 

(b) Purchaser shall credit the Cash Account for (i) any deposits therein by
Seller upon Seller’s written direction pursuant to a Withdrawal/Deposit Notice,
(ii) any amounts due Seller and payable by Purchaser under any UBSRES Purchase
Program to the extent not otherwise netted as described in Section 3 of this
Agreement, (iii) any Supplemental Amount for any Mortgage Loan upon the
refunding to Purchaser of the Disbursement Amount for such Mortgage Loan by the
Escrow Agent upon any failure to apply the Disbursement Amount in connection
with the proposed funding of a Mortgage Loan, (iv) any credit pursuant to a Cash
Account Adjustment, (v) any Cash Account Interest Accruals and (vi) any deposits
by Seller pursuant to Section 7 hereof.

 

(c) Purchaser shall debit the Cash Account for (i) any withdrawals therefrom by
Seller upon Seller’s written direction pursuant to a Withdrawal/Deposit Notice,
(ii) any amounts due Purchaser and payable by Seller under any UBSRES Purchase
Program, (iii) the Supplemental Amount for any Mortgage Loan upon payment of the
Disbursement Amount for such Mortgage Loan to the Escrow Agent in accordance
with Section 2(b)(2), Section 2(c)(1)

 

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and Section 2(d)(2), (iv) any debit pursuant to a Cash Account Adjustment and
(v) any Wire Fees.

 

(d) Upon termination of this Agreement and payment in full of all obligations
owing by Seller hereunder, under the Custodial Agreement and under the
Electronic Tracking Agreement, Purchaser shall remit to Seller the Cash Account
Balance.

 

Section 6. Servicing of the Mortgage Loans.

 

(a) It is expressly acknowledged that the Servicing Rights relating to each
Mortgage Loan purchased by Purchaser hereunder have been sold, assigned, and
transferred by Seller to Purchaser along with such Mortgage Loan. Seller shall
service and administer each Mortgage Loan on behalf of Purchaser on an interim
basis in accordance with accepted and prudent mortgage loan servicing standards
and procedures generally accepted in the mortgage banking industry for the same
type of mortgage loans as the Mortgage Loans and in a manner at least equal in
quality to the servicing the Seller provides for mortgage loans which it owns,
provided that Seller shall at all times comply with applicable law and the
requirements of any applicable insurer or guarantor so that the insurance and
any applicable guarantee in respect of any Mortgage Loan is not voided or
reduced. Seller shall at all times maintain accurate and complete records of its
servicing of each Mortgage Loan, and Purchaser may, at any time during Seller’s
business hours, on reasonable notice, examine and make copies of such records.
On the 2nd day of each calendar month, or at any other time upon Purchaser’s
request Seller shall deliver to Purchaser reports regarding the status of each
Mortgage Loan in accordance with Section 11(o) and Section 11(p), which shall
include, with respect to any MERS Designated Mortgage Loan, MERS Reports, and
any circumstances that could materially adversely affect any such Mortgage Loan,
Purchaser’s ownership of any such Mortgage Loan or the collateral securing any
such Mortgage Loan. The Seller agrees and acknowledges that Purchaser may, at
any time, terminate the servicing of the Mortgage Loans by Seller and transfer
servicing to another Person on such date as Purchaser may determine in its sole
discretion. In the event that anything in this Agreement is interpreted as
constituting one or more interim servicing contracts, each such servicing
contract shall terminate automatically upon the earliest of (i) an Event of
Default, (ii) the repurchase of a Mortgage Loan by the Seller or (iii) the
Purchaser’s notice to Seller directing Seller to transfer servicing (provided,
Seller’s obligations as set forth herein to cooperate in the transfer of such
servicing shall not terminate until such servicing has actually been transferred
in full).

 

(b) Within five Business Days of notice from Purchaser, or immediately upon
notice if an Event of Default has occurred:

 

(i) Seller shall establish and maintain a Custodial Account entitled “Crescent
Mortgage Services, Inc., in trust for UBS Warburg Real Estate Securities Inc.
and its assignees under the Amended and Restated Mortgage Loan Repurchase
Agreement dated January 31, 2003 and shall promptly deposit into such Custodial
Account, in the form received with any necessary endorsements, all collections
received in respect of each Mortgage Loan that are payable to Purchaser as the
owner of each such Mortgage Loan; and

 

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(ii) at the Purchaser’s sole option, upon written notice from the Purchaser, the
Seller shall transfer servicing of the Mortgage Loans to a successor servicer
designated by the Purchaser.

 

(c) Amounts deposited in the Custodial Account with respect to any Mortgage Loan
shall be held in trust for Purchaser as the owner of such Mortgage Loan and
shall be released only as follows:

 

(i) All amounts deposited in the Custodial Account shall be paid to Seller upon
the repurchase by Seller of the related Mortgage Loans from Purchaser if, and to
the extent that, the Repurchase Prices and all other amounts due and payable to
Purchaser hereunder with respect to such Mortgage Loans have been paid. The
amounts paid to Seller (if any) pursuant to this Section 6(c)(i) shall
constitute Seller’s sole compensation for servicing the Mortgage Loans as
provided in this Section 6.

 

(ii) If a Successor Servicer is appointed by Purchaser (either under the
circumstances set forth in clause (b)(ii) above, Section 7 or otherwise), or if
an Event of Default has occurred, all amounts deposited in the Custodial Account
shall be paid to Purchaser promptly upon such delivery.

 

(iii) During the period that Seller acts as Servicer, all amounts deposited in
the Custodial Account shall be released only in accordance with Purchaser’s
written instructions.

 

(d) In the event the Seller or its Affiliate is servicing the Mortgage Loans,
the Seller shall permit the Purchaser to inspect the Seller’s or its Affiliate’s
servicing facilities, as the case may be, for the purpose of satisfying the
Purchaser that the Seller or its Affiliate, as the case may be, has the ability
to service the Mortgage Loans as provided in this Agreement.

 

(e) If the servicer of the Mortgage Loans is Seller or the Servicer is an
Affiliate of Seller, Seller shall provide to Purchaser a letter from Seller or
such Affiliate, as the case may be, to the effect that upon 1 day’s notice from
Purchaser or immediately upon the occurrence of an Event of Default, Servicer’s
rights and obligations to service the Mortgage Loans shall terminate
immediately, without any further notice or action by Purchaser and Servicer
shall transfer servicing to Purchaser’s designee, at no cost or expense to the
Purchaser, it being agreed that the Seller will pay any and all fees required to
terminate the Servicing Agreement and to effectuate the transfer of servicing to
the designee of the Purchaser.

 

Section 7. Remedies; Margin Deficits.

 

(a) Upon the occurrence of an Event of Default, at the option of Purchaser
exercised by written notice to Seller (which option shall be deemed to have been
exercised even if no notice is given, immediately upon the occurrence of an Act
of Insolvency with respect to Seller or an Affiliate of Seller), the Scheduled
Repurchase Date for each Transaction hereunder shall be, deemed immediately to
occur and, upon exercise of such option, (i) Seller’s obligations hereunder to
repurchase all Mortgage Loans shall thereupon become immediately due and
payable, (ii) the Pass-Through Rate applicable to each Mortgage Loan shall
increase by the Incremental Pass-Through Rate, (iii) all amounts then or
thereafter held in any Custodial

 

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Accounts and the Cash Account shall be retained by Purchaser and applied to the
aggregate unpaid Repurchase Prices owed by Seller and to any other amounts owing
by Seller hereunder or under the Custodial Agreement and (iv) Purchaser may at
any time on the Business Day following notice to Seller (which notice may be the
notice given above of an Event of Default), (A) immediately sell, without demand
or further notice of any kind, at a public or private sale and at such price or
prices as Purchaser may deem satisfactory, any or all the Mortgage Loans and
apply the proceeds thereof (net of any expenses of sale) to the aggregate unpaid
Repurchase Prices and any other amounts owing by Seller hereunder or under the
Custodial Agreement or (B) in its sole discretion elect, in lieu of selling all
or a portion of such Mortgage Loans, to give Seller credit for such Mortgage
Loans in an amount equal to the price therefor on such date, obtained from a
generally recognized source or the most recent closing bid quotation from such a
source, against the aggregate unpaid Repurchase Prices and any other amounts
owing by Seller hereunder or under the Custodial Agreement, and in either case
upon the determination and receipt by Purchaser of all such amounts owing by
Seller (including, without limitation, any unpaid fees, expenses, legal fees and
expenses of Purchaser’s counsel or other amounts owing to Purchaser under this
Agreement, the Electronic Tracking Agreement or the Custodial Agreement),
Purchaser shall transfer any remaining portion of the Mortgage Loans and
proceeds thereof to either (1) Seller, if in Purchaser’s reasonable judgment
Seller is legally entitled thereto, (2) such other entity as is in Purchaser’s
reasonable judgment legally entitled thereto or (3) if Purchaser cannot
determine in its judgment the entity entitled thereto, a court of competent
jurisdiction; provided that Seller shall be liable for any deficiency if the
proceeds of any sale or other disposition of the Mortgage Loans and any amounts
applied from the Custodial Account and the Cash Account are insufficient to pay
all amounts to which Purchaser is entitled hereunder.

 

(b) If any Mortgage Loan becomes a Defective Mortgage Loan prior to the
Repurchase Date, the Pass-Through Rate applicable to such Defective Mortgage
Loan shall increase by the Incremental Pass-Through Rate, and Purchaser, at its
election, may immediately accelerate the Scheduled Repurchase Date and require
that Seller, upon receipt of such election, immediately repurchase such
Defective Mortgage Loan by remitting to Purchaser (in immediately available
funds in accordance with Purchaser’s Wire Instructions) the Repurchase Price for
such Defective Mortgage Loan.

 

(c) If Seller fails to comply with its obligations in the manner described in
Section 7(b) or under the Electronic Tracking Agreement or if the Purchaser
delivers notice to Seller pursuant to Section 6(a) or 6(b) hereof Seller’s
rights and obligations to interim service Mortgage Loans, as provided in this
Agreement, shall terminate. If any such event occurs, Seller’s rights and
obligations to service the Mortgage Loans, as provided in this Agreement, shall
terminate immediately, without any further notice or action by Purchaser. Upon
any such termination, Purchaser is hereby authorized and empowered to sell and
transfer such rights to service the Mortgage Loans for such price and on such
terms and conditions as Purchaser shall determine in its sole discretion. Seller
does not have any right to and shall not attempt to sell or transfer the
Servicing Rights or any rights incident thereto without the prior consent of the
Purchaser, which may be withheld in Purchaser’s sole discretion. In the event of
any servicing transfer, Seller shall perform all acts and take all action so (i)
that the Mortgage Loans and all files and documents relating to such Mortgage
Loans held by Seller, together with all escrow amounts relating to such Mortgage
Loans, are delivered to a Successor Servicer, (ii) all

 

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applicable laws and regulations relating to the servicing of the Mortgage Loans
and any transfer of the such servicing with respect thereto are complied with in
all respects, including, without limitation all provisions of RESPA, the Truth
in Lending Act and other applicable laws and (iii) with respect to all MERS
Designated Mortgage Loans, the “Servicer” and all other relevant fields in the
MERS® System are modified to reflect the Successor Servicer, where applicable.
To the extent that the approval of any other insurer or guarantor is required
for any such sale or transfer, Seller shall fully cooperate with Purchaser to
obtain such approval. Upon exercise, by Purchaser of its remedies under this
Section 7(c), Seller hereby authorizes Purchaser to receive all amounts paid by
any purchaser of such rights to service the Mortgage Loans and to remit such
amounts to Seller subject to Purchaser’s rights of set-off under this Agreement.

 

(d) Each Mortgage Loan required to be delivered to a Successor Servicer by
Section 7(c) shall be delivered free of any Servicing Rights in favor of Seller
and free of any title, interest, lien, encumbrance or claim of any kind of
Seller, and Seller shall deliver or cause to be delivered all files and
documents relating to each Mortgage Loan held by Seller to a Successor Servicer.
Seller shall promptly take such actions and furnish to Purchaser such documents
that Purchaser deems necessary or appropriate to enable Purchaser to cure any
defect in each such Mortgage Loan or to enforce such Mortgage Loans, as
appropriate.

 

(e) Seller agrees to indemnify and hold Purchaser and its assigns harmless for
and against all Losses resulting from or relating to any Event of Default.

 

(f) No election by Purchaser pursuant to this Section 7 shall relieve Seller of
responsibility or liability for any breach of or under this Agreement.

 

(g) Seller and its Affiliates hereby grant Purchaser and its Affiliates a right
of set-off, to secure the payment of any amounts that may be due and payable to
Purchaser from Seller, such right to be upon any and all monies or other
property of Seller and its Affiliates held or received by Purchaser and its
Affiliates, or due and owing from Purchaser and its Affiliates to Seller and its
Affiliates.

 

(h) If at any time the aggregate Asset Value of the Mortgage Loans is less than
the aggregate Purchase Price for all such Mortgage Loans (a “Margin Deficit”),
then Purchaser may by notice to Seller (as such notice is more particularly set
forth below, a “Margin Deficit Notice”), accelerate the Scheduled Repurchase
Date for the Mortgage Loans or require Seller to deposit into the Cash Account
an amount (which amount may be deposited in the form of United States treasury
obligations approved by the Purchaser) equal to the Margin Deficit so that the
aggregate Asset Value of the Mortgage Loans, including any such amounts
deposited into the Cash Account, will thereupon equal or exceed the aggregate
Asset Value. If Purchaser delivers a Margin Deficit Notice to Seller on or prior
to 10:00 a.m. (New York City time) on any Business Day, then Seller shall
repurchase the specified Mortgage Loans or deposit an amount equal to the Margin
Deficit into the Cash Account no later than 5:00 p.m. (New York City time) on
such Business Day. In the event Purchaser delivers a Margin Deficit Notice to
Seller after 10:00 a.m. (New York City time) on any Business Day, then such
Margin Deficit Notice shall be deemed to have been delivered on the following
Business Day and Seller shall be required to repurchase the specified Mortgage
Loans or deposit an amount equal to the Margin Deficit into the Cash Account no
later than 5:00 p.m. (New York City time) on such subsequent Business Day.

 

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Section 8. Transfer of Mortgage Loan by Purchaser. Purchaser may, in its sole
discretion, grant or assign a security interest in any Mortgage Loan sold by
Seller hereunder and all rights of Purchaser under this Agreement, the
Electronic Tracking Agreement and/or the Custodial Agreement, in respect of such
Mortgage Loan to Assignee, subject only to an obligation on the part of Assignee
to deliver each such Mortgage Loan to Purchaser to permit Purchaser or its
designee to make delivery thereof to Seller on the Repurchase Date. It is
anticipated that such assignment to Assignee will be made by Purchaser, and
Seller hereby irrevocably consents to such assignment. No notice of such
assignment shall be given by Purchaser to Seller. Assignment by Purchaser of the
Mortgage Loans as provided in this Section 8 shall not release Purchaser from
its obligations otherwise under this Agreement. Without limitation of the
foregoing, an assignment of a Mortgage Loan to Assignee, as described in this
Section 8, shall be effective upon delivery to Assignee of a Dry Submission
Package.

 

Section 9. Record Title to Mortgage Loans; Intent of Parties; Security Interest.

 

(a) From and after the delivery of the related Submission Package, and subject
to the remedies of Purchaser set forth in Section 7, Seller shall remain the
named payee or endorsee of each Mortgage Note and the mortgage or assignee of
record of each Mortgage (except with respect to a MERS Designated Mortgage Loan)
in trust for the benefit of Purchaser, for the sole purpose of facilitating the
servicing of such Mortgage Loan.

 

(b) Seller shall maintain a complete set of books and records for each Mortgage
Loan which shall be clearly marked to reflect the ownership interest in each
Mortgage Loan of Purchaser and with respect to each MERS Designated Mortgage
Loan, Seller shall designate the Purchaser as the Investor and Interim Funder on
the MERS® System.

 

(c) Purchaser and Seller confirm that the Transactions contemplated herein are
intended to be sales of the Mortgage Loans by Seller to Purchaser rather than
borrowings secured by the Mortgage Loans. In the event, for any reason, any
Transaction is construed by any court or regulatory authority as a borrowing
rather than as a sale, Seller and Purchaser intend that Purchaser or Assignee,
as the case may be, shall have a perfected first priority security interest in
the Collateral, free and clear of adverse claims. In such case, Seller shall be
deemed to have hereby granted to Purchaser or Assignee, as the case may be, a
first priority security interest in and lien upon the Collateral, free and clear
of adverse claims. In such event, this Agreement shall constitute a security
agreement, the Custodian shall be deemed to be an independent custodian for
purposes of perfection of the security interest granted to Purchaser or
Assignee, as the case may be, and Purchaser or Assignee, as the case may be,
shall have all of the rights of a secured party under applicable law. Seller
shall, not later than the date of the first purchase of a Mortgage Loan by
Purchaser under this Agreement, deliver to Purchaser a UCC-1 Financing
Statement, executed by Seller, containing a description of collateral in the
form attached hereto in Exhibit I.

 

Section 10. Representations and Warranties.

 

(a) Seller hereby represents and warrants to Purchaser as of the date hereof and
as of the date of each delivery of a Submission Package that:

 

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(i) Seller is duly organized, validly existing and in good standing under the
laws of the state of its organization or of the United States of America and has
all licenses necessary to carry on its business as now being conducted and is
licensed, qualified and in good standing in the state where the Mortgaged
Property is located if the laws of such state require licensing or qualification
in order to conduct business of the type conducted by Seller. Seller has all
requisite power and authority (including, if applicable, corporate power) to
execute and deliver this Agreement, the Electronic Tracking Agreement and the
Custodial Agreement and to perform in accordance herewith and therewith; the
execution, delivery and performance of this Agreement, the Electronic Tracking
Agreement and the Custodial Agreement (including all instruments of transfer to
be delivered pursuant to this Agreement, the Electronic Tracking Agreement or
the Custodial Agreement) by Seller and the consummation of the transactions
contemplated hereby and thereby have been duly and validly authorized. Each of
this Agreement, the Electronic Tracking Agreement and the Custodial Agreement
evidences the valid, binding and enforceable obligation of Seller and all
requisite action (including, if applicable, corporate action) has been taken by
Seller to make this Agreement, the Electronic Tracking Agreement and the
Custodial Agreement valid and binding upon Seller in accordance with its terms;

 

(ii) No approval of the transactions contemplated by this Agreement, the
Electronic Tracking Agreement or the Custodial Agreement from the OTS, the NCUA,
the FDIC or any similar federal or state regulatory authority having
jurisdiction over Seller is required, or if required, such approval has been
obtained. The transfers, assignments and conveyances provided for herein and
therein are not subject to the bulk transfer or any similar statutory provisions
in effect in any applicable jurisdiction;

 

(iii) The consummation of the transactions contemplated by this Agreement, the
Electronic Tracking Agreement and the Custodial Agreement are in the ordinary
course of business of Seller and will not result in the breach of any term or
provision of the charter or by-laws of Seller or result in the breach of any
term or provision of, or conflict with or constitute a default under or result
in the acceleration of any obligation under, an agreement, indenture or loan or
credit agreement or other instrument to which Seller or its property is subject,
or result in the violation of any law, rule, regulation, order, judgement or
decree to which Seller or its property is subject;

 

(iv) This Agreement, the Custodial Agreement, the Electronic Tracking Agreement
and every document to be executed by Seller pursuant hereto and thereto is and
will be valid, binding and a subsisting obligation of Seller, enforceable in
accordance with its respective terms. No consents or approvals are required to
be obtained by Seller or its Parent Company for the execution, delivery and
performance of this Agreement, the Electronic Tracking Agreement or the
Custodial Agreement by Seller;

 

(v) All information relating to Seller that Seller has delivered or caused to be
delivered to Purchaser, including, but not limited to, all documents related to
this Agreement, the Electronic Tracking Agreement, the Custodial Agreement or
Seller’s financial statements, and all such information hereafter furnished by
Seller, does not and will not contain any untrue statement of a material fact or
omit to state a material fact

 

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necessary to make the statements made therein or herein in light of the
circumstances under which they were made, not misleading. Seller has disclosed
in writing any and all facts relating to Seller that materially and adversely
affect or may affect the business operations or financial condition of Seller or
the ability of Seller to perform its obligations under this Agreement, the
Electronic Tracking Agreement or the Custodial Agreement;

 

(vi) There are no actions, suits or proceedings pending, or to the knowledge of
Seller threatened, including any claims for which an action, suit or proceeding
has not been commenced, against or affecting Seller or any of its assets in any
court or before any arbitrator or before any governmental commission, board,
bureau or other administrative agency that, in any such case, if adversely
determined, would have a material adverse effect on the financial condition or
business of Seller or the ability of Seller to perform under this Agreement, the
Electronic Tracking Agreement, each Funding Confirmation and the Custodial
Agreement;

 

(vii) Seller and its Subsidiaries have filed all Federal income tax returns and
all other material tax returns that are required to be filed by them and have
paid all taxes due pursuant to such returns or pursuant to any assessment
received by it or any of its Subsidiaries, except for any such taxes as are
being appropriately contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate reserves have been
provided. The charges, accruals and reserves on the books of Seller and its
Subsidiaries in respect of taxes and other governmental charges are, in the
opinion of Seller, adequate;

 

(viii) Neither Seller nor any of its Subsidiaries is an “investment company”, or
a company “controlled” by an “investment company”, within the meaning of the
Investment Company Act of 1940, as amended;

 

(ix) Upon the filing of financing statements on Form UCC-1 naming Purchaser as
“Secured Party”, Seller as “Debtor” and describing the Mortgage Loans, in the
jurisdictions and recording offices listed on Exhibit V attached hereto, the
security interests granted hereunder in the Mortgage Loans will constitute fully
perfected security interests under the Uniform Commercial Code in all right,
title and interest of Seller in, to and under such Mortgage Loans, which can be
perfected by filing under the Uniform Commercial Code;

 

(x) As of the date hereof, and during the four months immediately preceding the
Effective Date, Seller’s chief executive office, is, and has been located at 115
Perimeter Center Place, Suite 285, Atlanta, Georgia 30346. As of the date
hereof, Seller’s jurisdiction of organization is Georgia;

 

(xi) the aggregate Tangible Net Worth of Seller is not less than $10,000,000;

 

(xii) Seller (and each servicer) is approved by GNMA as an approved issuer,
Fannie Mae as an approved lender, Freddie Mac as an approved seller/servicer (as
the case may be) and by FHA as an approved mortgagee and by VA as an approved VA

 

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lender, in each case in good standing (such collective approvals and conditions,
“Agency Approvals”), with no event having occurred or Seller (or any
subservicer) having any reason whatsoever to believe or suspect will occur prior
to the purchase of the Mortgage Loan by the related Agency, including without
limitation a change in insurance coverage which would either make Seller (or any
servicer) unable to comply with the eligibility requirements for maintaining all
such Agency Approvals or require notification to the relevant Agency or to HUD,
FHA or VA. Should Seller (or any servicer), for any reason, cease to possess all
such Agency Approvals, or should notification to the relevant Agency or to HUD,
FHA or VA be required, Seller shall so notify Purchaser immediately in writing.
Notwithstanding the preceding sentence, Seller shall take all necessary action
to maintain all of its (and each servicer’s) Agency Approvals at all times
during the term of this Agreement. Seller (and any servicer) has adequate
financial standing, servicing facilities, procedures and experienced personnel
necessary for the sound servicing of mortgage loans of the same types as may
from time to time constitute Mortgage Loans and in accordance with Accepted
Servicing Practices;

 

(xiii) The Custodian is an eligible custodian under the Agency Guide and Agency
Program;

 

(xiv) As of the date hereof, with respect to the Original Repurchase Agreement,
no Event of Default (as defined therein) has occurred and is continuing and the
Seller is not in default with respect to any of its obligations thereunder.

 

(b) With respect to each Mortgage Loan as of the related Purchase Date, Seller
hereby represents and warrants that the Mortgage Loan has been originated with
30 days of the date such Mortgage Loan was first sold to Purchaser hereunder and
Seller hereby makes each representation, warranty and covenant set forth on
Schedule 1 hereto.

 

(c) Seller hereby represents and warrants to Purchaser as of the date hereof and
as of each Purchase Date, (i) with respect to the Escrow Agent Wire
Instructions, the Seller received such instructions on the letterhead of the
Escrow Agent and such instructions are true and correct and (ii) Seller has
inserted the Closing Instruction Letter Insert in each Closing Instruction
Letter for all Wet Fundings and Dry Fundings structured as Closing Transactions.

 

(d) Seller hereby represents and warrants to Purchaser as of the date hereof and
as of each Purchase Date, with respect to each Wet Funding or Dry Funding
structured as a Closing Transaction, an insured closing letter from each Escrow
Agent that is not a title insurance company is included in the Credit File and
Seller shall promptly, upon request of Purchaser, send to Purchaser (i) a copy
of any such insured closing letter and (ii) a complete list of all Escrow Agents
Seller has approved to act as an Escrow Agent.

 

The representations and warranties of Seller in this Section 10 and Schedule 1
hereto are unaffected by and supersede any provision in any endorsement of any
Mortgage Loan or in any assignment with respect to such Mortgage Loan to the
effect that such endorsement or assignment is without recourse or without
representation or warranty.

 

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Section 11. Covenants of Seller. Seller hereby covenants and agrees with
Purchaser as follows:

 

(a) Seller shall deliver to Purchaser; UBS Warburg Real Estate Securities Inc.,
1285 Avenue of the Americas, 11th Floor, New York, New York 10019, Attention:
Peter Coras and Gary Gartland:

 

(i) Within 120 days after the end of each fiscal year of Seller, consolidated
balance sheets of Seller and its consolidated subsidiaries and the related
consolidated statements of income showing the financial condition of Seller and
its consolidated subsidiaries as of the close of such fiscal year, consolidated
statement of cash flows, as of the close of such fiscal year, setting forth, in
each case, in comparative form the corresponding figures for the preceding year,
all the foregoing consolidated financial statements to be reported on by, and to
carry the report (acceptable in form and content to Purchaser) of an independent
public accountant of national standing acceptable to Purchaser;

 

(ii) Within 20 days after the end of each of the first eleven months of each
fiscal year of Seller, unaudited consolidated balance sheets and consolidated
statements of income, all to be in a form acceptable to Purchaser, showing the
financial condition and results of operation of Seller and its consolidated
subsidiaries on a consolidated basis as of the end of each such month and for
the then elapsed portion of the fiscal year, setting forth, in each case, in
comparative form the corresponding figures for the corresponding periods of the
preceding fiscal year, certified by a financial officer of Seller (acceptable to
Purchaser) as presenting fairly the financial position and results of operations
of Seller and its consolidated subsidiaries and as having been prepared in
accordance with generally accepted accounting principles consistently applied,
in each case, subject to normal year-end audit adjustments;

 

(iii) Promptly upon receipt thereof, a copy of each other report submitted to
Seller by its independent public accountants in connection with any annual,
interim or special audit of Seller;

 

(iv) Promptly upon becoming aware thereof, notice of (1) the commencement of, or
any determination in, any legal, judicial or regulatory proceedings, (2) any
dispute between Seller or its Parent Company and any governmental or regulatory
body, (3) any event or condition, which, in any case of (1) or (2), if adversely
determined, would have a material adverse effect on (A) the validity or
enforceability of this Agreement, (B) the financial condition or business
operations of Seller, or (C) the ability of Seller to fulfill its obligations
under this Agreement or (4) any material adverse change in the business,
operations, prospects or financial condition of Seller, including, without
limitation, an Act of Insolvency with respect to Seller or any Affiliate of
Seller;

 

(v) Promptly upon becoming available, copies of all financial statements,
reports, notices and proxy statements sent by its Parent Company, Seller or any
of Seller’s consolidated subsidiaries in a general mailing to their respective
stockholders and of all reports and other material (including copies of all
registration statements under the

 

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Securities Act of 1933, as amended) filed by any of them with any securities
exchange or with the Securities and Exchange Commission or any governmental
authority succeeding to any or all of the functions of said Commission;

 

(vi) Promptly upon becoming available, copies of any press releases issued by
its Parent Company or Seller and copies of any annual and quarterly financial
reports and any reports on Form H-(b)12 which its Parent Company or Seller may
be required to file with the OTS or the RTC or comparable reports which a Parent
Company or Seller may be required to file with the FDIC or any other federal
banking agency containing such financial statements and other information
concerning such Parent Company’s or Seller’s business and affairs as is required
to be included in such reports in accordance with the rules and regulations of
the OTS, the RTC, the FDIC or such other banking agency, as may be promulgated
from time to time;

 

(vii) Such supplements to the aforementioned documents and such other
information regarding the operations, business, affairs and financial condition
of its Parent Company, Seller or any of Seller’s consolidated subsidiaries as
Purchaser may request;

 

(viii) Prior to the date of any purchase of a Mortgage Loan by Purchaser
hereunder, a copy of (1) the articles of incorporation of Seller and any
amendments thereto certified by the Secretary of State of Seller’s state of
incorporation, (2) a copy of Seller’s by-laws, together with any amendments
thereto, (3) a copy of the resolutions adopted by Seller’s Board of Directors
authorizing Seller to enter into this Agreement, the Electronic Tracking
Agreement and the Custodial Agreement and authorizing one or more of Seller’s
officers to execute the documents related to this Agreement, the Electronic
Tracking Agreement and the Custodial Agreement, (4) a certificate of incumbency
and signature of each officer of Seller executing any document in connection
with this Agreement, the Electronic Tracking Agreement and the Custodial
Agreement; (5) a certificate reflecting each Authorized Signatory of the Seller,
in the form of Exhibit N hereto and (6) an opinion of counsel to Seller, in the
form of Exhibit U hereto;

 

(ix) A Covenant Compliance Letter, substantially in the form of Exhibit X
hereto, within 20 days after the end of each of the first eleven fiscal months
of each fiscal year, within 60 days after the end of each of the first three
fiscal quarters of each fiscal year and within 120 days after the end of each
fiscal year;

 

(x) On or before the date hereof, a copy of an opinion of counsel to Seller,
substantially in the form of Exhibit U hereto.

 

(b) Seller will be solvent at all relevant times prior to, and will not be
rendered insolvent by, any sale of a Mortgage Loan to Purchaser.

 

(c) Seller will not sell any Mortgage Loan to Purchaser with any intent to
hinder, delay or defraud any of Seller’s creditors.

 

(d) Seller shall comply, in all material respects, with all laws, rules and
regulations to which it is or may become subject.

 

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(e) Seller shall not move its chief executive office from the address referred
to in Section 10 or change its jurisdiction of organization unless it shall have
provided Purchaser thirty (30) days’ prior written notice of such change.

 

(f) Seller shall pay and discharge all taxes, assessments and governmental
charges or levies imposed on it or on its income or profits or on any of its
Property prior to the date on which penalties attach thereto, except for any
such tax, assessment, charge or levy the payment of which is being contested in
good faith and by proper proceedings and against which adequate reserves are
being maintained.

 

(g) Seller shall, upon request of Purchaser, promptly execute and deliver to
Purchaser all such other and further documents and instruments of transfer,
conveyance and assignment, and shall take such other action as Purchaser may
require to more effectively transfer, convey, assign to and vest in Purchaser
and to put Purchaser in possession of the property to be transferred, conveyed,
assigned and delivered hereunder and otherwise to carry out more effectively the
intent of the provisions under this Agreement.

 

(h) Immediately upon notice of a lien or any circumstance which could give rise
to a lien on the Mortgage Loans, Seller will defend the Mortgage Loans against,
and will take such other action as is necessary to remove, any lien, security
interest or claim on or to the Mortgage Loans (other than any security interest
created under this Repurchase Agreement), and Seller will defend the right,
title and interest of Purchaser in and to any of the Mortgage Loans against the
claims and demands of all persons whomsoever.

 

(i) If during the term of a Transaction, Seller gains possession of a Submission
Package that relates to the Transaction, Seller shall hold such Submission
Package in trust for Purchaser, immediately notify Purchaser of the specific
Submission Package being held by Seller and promptly deliver such Submission
Package via overnight courier in accordance with Purchaser’s instructions.

 

(j) Seller covenants and agrees to take all actions required of it in compliance
with the terms of the Electronic Tracking Agreement.

 

(k) Seller shall maintain a Tangible Net Worth which shall be not less than the
greater of (i) $10,000,000 measured on a quarterly basis (as at the end of each
month) and (ii) (A) 85% of the Tangible Net Worth of Seller at the end of the
most recently completed fiscal year of Seller plus (B) 90% of capital
contributions made during such fiscal year plus (C) 50% of positive year to date
net income.

 

(l) [Reserved]

 

(m) Seller shall not permit, for any period of three consecutive fiscal months
(each such period, a “Test Period”), Net Income for such Test Period, before
income taxes for such Test Period and distributions made during such Test
Period, to be less than $1.00.

 

(n) Seller shall, with respect to each Mortgage Loan, causes the paragraphs set
forth on Exhibit S hereto to be inserted into each closing letter or other
similar agreement with

 

-31-

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the Escrow Agent for such Mortgage Loan, and shall, upon the request of
Purchaser, fax a copy of such closing letter to Purchaser prior to the closing
of such Mortgage Loan.

 

(o) Seller shall provide Purchaser with a monthly report, which report shall
include, among other items, a summary of the Seller’s delinquency and loss
experience with respect to mortgage loans serviced by the Seller, any Servicer
or any designee of either, with respect to any MERS Designated Mortgage Loan,
MERS Reports, plus any such additional reports as Purchaser may reasonably
request with respect to the Seller’s or any Servicer’s servicing portfolio or
pending originations of mortgage loans. Seller shall not cause the Mortgage
Loans to be serviced by any servicer other than a servicer expressly approved in
writing by Purchaser.

 

(p) On the second Business Day of each month, Seller shall furnish to Purchaser
or shall cause the Servicer to furnish to Purchaser, a remittance report, in
hard copy and electronic format acceptable to Purchaser, containing information
regarding funds collected during the prior calendar month. This report shall
contain the following information:

 

(i) Mortgage Loan number;

 

(ii) Note Rate;

 

(iii) Remittances allocable to principal and interest;

 

(iv) Paid through date;

 

(v) Mortgage Loan balance;

 

(vi) Delinquency status;

 

(vii) Whether the Mortgaged Property is in foreclosure or has become an real
state owned property;

 

(viii) Whether any Mortgagor is the subject of any bankruptcy action; and

 

(ix) Any other information that Purchaser may reasonably request.

 

Section 12. Periodic Due Diligence. (a) Seller acknowledges that Purchaser has
the right to perform continuing due diligence reviews with respect to the
Mortgage Loans, for purposes of verifying compliance with the representations,
warranties and specifications made hereunder, or otherwise, and Seller agrees
that upon reasonable (but no less than one (1) Business Day’s) prior notice to
Seller, Purchaser or its authorized representatives will be permitted during
normal business hours to examine, inspect, and make copies and extracts of, the
Mortgage Files and any and all documents, records, agreements, instruments or
information relating to any Mortgage Loans in the possession or under the
control of Seller and/or the Custodian. Seller shall make available to Purchaser
a knowledgeable financial or accounting officer for the purpose of answering
questions respecting the Mortgage Loans. Without limiting the generality of the
foregoing, Seller acknowledges that Purchaser may purchase Mortgage Loans from
Seller based solely upon the information provided by Seller to Purchaser in the

 

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Closing Loan Purchase Detail or Rewarehousing Loan Purchase Detail, as
applicable, and the representations, warranties and covenants contained herein,
and that Purchaser, at its option, has the right at any time to conduct a
partial or complete due diligence review on some or all of the Mortgage Loans
purchased by Purchaser, including without limitation ordering new credit reports
and new appraisals on the related Mortgaged Properties and otherwise
re-generating the information used to originate such Mortgage Loan. Purchaser
may underwrite such Mortgage Loans itself or engage a mutually agreed upon third
party underwriter to perform such underwriting. Seller agrees to cooperate with
Purchaser and any third party underwriter in connection with such underwriting,
including, but not limited to, providing Purchaser and any third party
underwriter with access to any and all documents, records, agreements,
underwriting reports, instruments or information relating to such Mortgage Loans
in the possession, or under the control, of Seller. All such due diligence
conducted in accordance with this Section 12 shall be at the expense of Seller.

 

(b) Without limiting the generality of the foregoing, Seller acknowledges that
upon demand by Purchaser, Seller shall deliver within five Business Days copies
of the Closing Instruction Letters reflecting the addition of the Closing
Instruction Letter Insert for all Wet Fundings and Dry Fundings structured as
Closing Transactions closed prior to the date of such demand. Seller
acknowledges Purchaser is authorized to contact any Escrow Agent or any other
person who has delivered a Closing Instruction Letter in connection with any Wet
Funding or Dry Funding in order to confirm the information contained in such
Closing Instruction Letter.

 

Section 13. Third Party Servicing. If the Mortgage Loans are serviced by a third
party servicer (such third party servicer, the “Servicer”), Seller (i) shall
provide a copy of the servicing agreement to Purchaser, which shall be in form
and substance acceptable to Purchaser (the “Servicing Agreement”); (ii) shall
provide a Servicer Notice to the Servicer substantially in the form of Exhibit W
hereto; and (iii) hereby irrevocably assigns to Purchaser and Purchaser’s
successors and assigns all right, title, interest of Seller in, to and under,
and the benefits of, any Servicing Agreement with respect to the Mortgage Loans.
Any successor to the Servicer shall be approved in writing by Purchaser prior to
such successor’s assumption of servicing obligations with respect to the
Mortgage Loans.

 

Section 14. Confidentiality. Seller hereby acknowledges and agrees that (i) all
written or computer-readable information provided by Purchaser to Seller
regarding Purchaser and (ii) the terms of this Agreement (the “Purchaser
Confidential Information”), shall be kept confidential and each of their
respective contents will not be divulged to any party without Purchaser’s
consent except to the extent that (i) Seller deems appropriate to do so in
working with legal counsel, auditors, taxing authorities or other governmental
agencies or regulatory bodies or in order to comply with any applicable federal
or state laws, (ii) any portion of Purchaser Confidential Information is in the
public domain other than due to a breach of this covenant, (iii) Seller deems
appropriate in connection with exercising any or all of Seller’s rights or
remedies or complying with any obligations under this Agreement.

 

Section 15. Term. This Agreement shall continue in effect until terminated as to
future transactions by written instruction signed by either Seller or Purchaser
and delivered to the other, provided that no termination will affect the
obligations hereunder as to any outstanding Transaction.

 

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Section 16. Exclusive Benefit of Parties; Assignment. The Agreement is for the
exclusive benefit of the parties hereto and their respective successors and
assigns and shall be deemed to give any legal or equitable right to any other
person, including the Custodian. Except as provided in Section 7, no rights or
obligations created by this Agreement may be assigned by any party hereto
without the prior written consent of the other parties.

 

Section 17. Amendments; Waivers; Cumulative Rights. This Agreement may be
amended from time to time only by written agreement of Seller and Purchaser. Any
forbearance, failure or delay by either party in exercising any right, power or
remedy hereunder shall not be deemed to be a waiver thereof, and any single or
partial exercise by Purchaser of any right, power or remedy hereunder shall not
preclude the further exercise thereof. Every right, power and remedy of
Purchaser shall continue in full force and effect until specifically waived by
Purchaser in writing. No right, power or remedy shall be exclusive, and each
such right, power or remedy shall be cumulative and in addition to any other
right, power or remedy, whether conferred hereby or hereafter available at law
or in equity or by statute or otherwise.

 

Section 18. Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which shall constitute one and the same instrument.

 

Section 19. Effect of Invalidity of Provisions. In case any one or more of the
provisions contained in this Agreement should be or become invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein or therein shall in no way be affected,
prejudiced or disturbed thereby.

 

Section 20. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to conflict of
law rules.

 

Section 21. Notices. Any notices, consents, elections, directions and other
communications given under this Agreement shall be in writing and shall be
deemed to have been duly given when telecopied or delivered by overnight courier
to, personally delivered to, or on the third day following the placing thereof
in the mail, first class postage prepaid to, the respective addresses set forth
on the cover page hereof for Seller and Purchaser, or to such other address as
either party shall give notice to the other party pursuant to this Section 21.
Notices to Assignee shall be given to such address as Assignee shall provide to
Seller in writing.

 

Section 22. Entire Agreement. This Agreement, the Funding Confirmations and the
Custodial Agreement contain the entire agreement between the parties hereto with
respect to the subject matter hereof, and supersede all prior and
contemporaneous agreements between them, oral or written, of any nature
whatsoever with respect to the subject matter hereof.

 

Section 23. Costs of Enforcement. In addition to any other indemnity specified
in this Agreement, in the event of a breach by Seller of this Agreement or the
Custodial Agreement. Seller agrees to pay the reasonable attorneys fees and
expenses of Purchaser and, when applicable, Assignee incurred in the enforcement
of the Agreement as a consequence of such breach.

 

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Section 24. Purchaser’s Appointment as Attorney-In-Fact. Seller hereby
irrevocably constitutes and appoints Purchaser and any officer or agent thereof,
with full power of substitution, as its true and lawful attorney-in-fact with
full irrevocable power and authority in the place and stead of Seller and in the
name of Seller or in its own name, from time to time in Purchaser’s discretion,
for the purpose of carrying out the terms of this Agreement, to take any and all
appropriate action and to execute any and all documents and instruments which
may be reasonably necessary or desirable to accomplish the purposes of this
Agreement, and, without limiting the generality of the foregoing, Seller hereby
gives Purchaser the power and right, on behalf of Seller, without assent by, but
with notice to, Seller, to do the following:

 

(a) in the name of Seller, or in its own name, or otherwise, to take possession
of and endorse and collect any checks, drafts, notes, acceptances or other
instruments for the payment of moneys due under any mortgage insurance or with
respect to any other Mortgage Loans and to file any claim or to take any other
action or proceeding in any court of law or equity or otherwise deemed
appropriate by Purchaser for the purpose of collecting any and all such moneys
due under any such mortgage insurance or with respect to any other Mortgage
Loans whenever payable;

 

(b) to pay or discharge taxes and liens levied or placed on or threatened
against the Mortgage Loans;

 

(c) (A) to direct any party liable for any payment under any Mortgage Loans to
make payment of any and all moneys due or to become due thereunder directly to
Purchaser or as Purchaser shall direct; (B) to ask or demand for, collect,
receive payment of and receipt for, any and all moneys, claims and other amounts
due or to become due at any time in respect of or arising out of any Mortgage
Loans; (C) to sign and endorse any invoices, assignments, verifications, notices
and other documents in connection with any Mortgage Loans; (D) to commence and
prosecute any suits, actions or proceedings at law or in equity in any court of
competent jurisdiction to collect the Mortgage Loans or any proceeds thereof and
to enforce any other right in respect of any Mortgage Loans; (E) to defend any
suit, action or proceeding brought against Seller with respect to any Mortgage
Loans; (F) to settle, compromise or adjust any suit, action or proceeding
described in clause (E) above and, in connection therewith, to give such
discharges or releases as Purchaser may deem appropriate; and (G) generally, to
sell, transfer, pledge and make any agreement with respect to or otherwise deal
with any Mortgage Loans as fully and completely as though Purchaser were the
absolute owner thereof for all purposes, and to do, at Purchaser’s option and
Seller’s expense, at any time, and from time to time, all acts and things which
Purchaser deems necessary to protect, preserve or realize upon the Mortgage
Loans and Purchaser’s liens thereon and to effect the intent of this Agreement,
all as fully and effectively as such Seller might do;

 

(d) to direct the actions of Custodian with respect to the Mortgage Loans under
the Custodial Agreement; and

 

(e) to execute, from time to time, in connection with any sale provided for in
Section 7, any endorsements, assignments or other instruments of conveyance or
transfer with respect to the Mortgage Loans.

 

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--------------------------------------------------------------------------------

 

Seller hereby ratifies all that said attorneys shall lawfully do or cause to be
done by virtue hereof. This power of attorney is a power coupled with an
interest and shall be irrevocable.

 

The powers conferred on Purchaser hereunder are solely to protect Purchaser’s
interests in the Mortgage Loans and shall not impose any duty upon it to
exercise any such powers. Purchaser shall be accountable only for amounts that
it actually receives as a result of the exercise of such powers, and neither it
nor any of its officers, directors, employees or agents shall be responsible to
Seller for any act or failure to act hereunder, except for its or their own
gross negligence or willful misconduct.

 

Section 25. Submission to Jurisdiction; Waivers.

 

SELLER HEREBY IRREVOCABLY AND UNCONDITIONALLY:

 

(1) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS REPURCHASE AGREEMENT AND THE OTHER REPURCHASE DOCUMENTS, OR FOR
RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE EXCLUSIVE
GENERAL JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, THE FEDERAL COURTS
OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND
APPELLATE COURTS FROM ANY THEREOF;

 

(2) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS
AND, TO THE EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT
OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND
AGREES NOT TO PLEAD OR CLAIM THE SAME;

 

(3) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE
EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY
SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO ITS ADDRESS SET FORTH
ON THE COVER PAGE HERETO OR AT SUCH OTHER ADDRESS OF WHICH PURCHASER SHALL HAVE
BEEN NOTIFIED;

 

(4) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN
ANY OTHER JURISDICTION; AND

 

(5) SELLER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING

 

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ARISING OUT OF OR RELATING TO THIS REPURCHASE AGREEMENT, ANY OTHER DOCUMENT
RELATING THERETO OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

 

Section 26. Construction. The headings in this Agreement are for convenience
only and are not intended to influence its construction. References to Sections
and Exhibits in this Agreement are to the Sections of and Exhibits to this
Agreement. The Exhibits and Schedules to this Agreement are part of this
Agreement, and are incorporated herein by reference. The singular includes the
plural, the plural the singular, and the words “and” and “or” are used in the
conjunctive or disjunctive as the sense and circumstances may require.

 

Section 27. Effect of Amendment and Restatement. Upon the execution of this
Agreement by all parties hereto and the delivery of the opinion required by
Section 11(a)(x), the Original Repurchase Agreement shall be amended, restated
and superseded in its entirety by this Agreement. The parties hereto acknowledge
and agree that (a) the liens and security interests granted under the Original
Repurchase Agreement are in full force and effect and, upon the amendment and
restatement of the Original Repurchase Agreement and the related documents, such
liens and security interests secure and continue to secure the payment and
performance of Seller’s obligations under this Agreement and the related
documents, and (b) upon the effectiveness of such amendment and restatement, all
outstanding Mortgage Loans under, and as defined in, the Original Repurchase
Agreement, shall be deemed to be outstanding as Mortgage Loans hereunder mutatis
mutandis, in each case on the terms and conditions set forth in this Agreement.

 

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IN WITNESS WHEREOF, Purchaser and Seller have duly executed this Agreement as of
the date and year set forth on the cover page hereof.

 

UBS WARBURG REAL ESTATE SECURITIES INC.

By:

 

/s/  GEORGE A. MANGIARACINA

 

--------------------------------------------------------------------------------

Name:

 

George A. Mangiaracina

Title:

 

Executive Director

 

 

By:

 

/s/  ROBERT CARPENTER

 

--------------------------------------------------------------------------------

Name:

 

Robert Carpenter

Title:

 

Director

 

CRESCENT MORTGAGE SERVICES, INC.

By:

 

/s/  MICHAEL P. LEDDY

 

--------------------------------------------------------------------------------

Name:

 

Michael P. Leddy

 

--------------------------------------------------------------------------------

Title:

 

Executive Vice President

 

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

EXHIBIT A

 

CLOSING LOAN PURCHASE DETAIL FIELDS

 

1.

  

Mortgage Loan Number

2.

  

Mortgagor’s Name (including first name)

3.

  

Property Street Address

4.

  

Property City

5.

  

Property State

6.

  

Property Zip

7.

  

The occupancy status of the Mortgaged Property at the time of origination (Owner
Occupied)

8.

  

The Mortgage Loan Purpose Type (i.e., purchase, rate and term refinance, equity
takeout refinance)

9.

  

A code indicating whether the Mortgaged Property is a single family residence, a
2-4 family dwelling, a townhouse, a unit in a highrise or low-rise condominium
project or a unit in a planned unit development, manufactured housing

10.

  

Documentation Style (i.e., full, alternative, or reduced stated income)

11.

  

Note Date

12.

  

Current Interest Rate

13.

  

Original Loan Balance

14.

  

Current Loan Balance

15.

  

Original Appraisal Value

16.

  

Amount which the borrower paid for Property

17.

  

Loan To Value Ratio at origination

18.

  

Combined Loan To Value

19.

  

A code indicating the type of Mortgage Loan (e.g., Jumbo Mortgage Loan, Alt-A
Mortgage Loan, Wet-Ink Mortgage Loan)

 

A-1

--------------------------------------------------------------------------------

 

20.

  

A code indicating whether the loan is an FHA, VA or conventional Mortgage Loan

21.

  

A code indicating whether the loan is an adjustable rate or fixed rate Mortgage
Loan

22.

  

Balloon Flag

23.

  

A code indicating the lien status of the Mortgage Loan

24.

  

Number of Units for the Mortgaged Property

25.

  

With respect to each adjustable rate Mortgage Loan, the Index Code

26.

  

With respect to each adjustable rate Mortgage Loan, the Gross Margin

27.

  

Next Interest Rate adjustment date

28.

  

Next Payment Change Date

29.

  

With respect to each adjustable rate Mortgage Loan, the interest rate adjustment
frequencies

30.

  

With respect to each adjustable rate Mortgage Loan, the Payment Adjustment
Frequency

31.

  

For each adjustable rate Mortgage Loan, the Mortgage Interest Rate adjustment
cap at all subsequent interest rate adjustment dates

32.

  

Periodic Payment Cap Percentage

33.

  

With respect to each adjustable rate Mortgage Loan, the lifetime mortgage
interest rate cap

34.

  

With respect to each adjustable rate Mortgage Loan, the lifetime mortgage
interest rate floor

35.

  

The primary mortgage insurance certificate number; a code indicating the method
of payment for mortgage insurance premiums and cost (Lender Paid PMI), if
applicable

36.

  

Lender or Borrower

37.

  

PMI Coverage Amount

38.

  

A code indicating whether the Mortgage Loan has a prepayment penalty

39.

  

A code indicating the prepayment penalty terms and the prepayment penalty amount
of the Mortgage Loan, if any

 

A-2

--------------------------------------------------------------------------------

 

40.

  

A code indicating if the Mortgage Loan is a Section 32 Loan

41.

  

Loans #/Credit Grade

42.

  

The Mortgagor’s credit risk score (FICO score)

43.

  

The debt-to-income ratio

44.

  

Requested Disbursement Amount

45.

  

MIN Number

46.

  

Escrow Agent Wire Instructions, if applicable

 

 

A-3

--------------------------------------------------------------------------------

EXHIBIT B

 

REWAREHOUSING LOAN PURCHASE DETAIL FIELDS

 

1.

  

Mortgage Loan Number

2.

  

Mortgagor’s Name

3.

  

Property Street Address

4.

  

Property City

5.

  

Property State

6.

  

Property Zip

7.

  

The occupancy status of the Mortgaged Property at the time of origination (Owner
Occupied)

8.

  

The Mortgage Loan Purpose Type (i.e., purchase, rate and term refinance, equity
takeout refinance)

9.

  

A code indicating whether the Mortgaged Property is a single family residence, a
2-4 family dwelling, a townhouse, a unit in a highrise or low-rise condominium
project or a unit in a planned unit development, manufactured housing

10.

  

Documentation Style (i.e., full, alternative, or reduced stated income)

11.

  

Current Interest Rate

12.

  

Original Loan Balance

13.

  

Current Loan Balance

14.

  

Original Appraisal Value

15.

  

Amount which the borrower paid for Property

16.

  

Loan To Value Ratio at origination

17.

  

Combined Loan To Value

18.

  

A code indicating the type of Mortgaged Loan (e.g., Jumbo Mortgage Loan, Alt-A
Mortgage Loan, Wet-Ink Mortgage Loan)

19.

  

A code indicating whether the loan is an FHA, VA or conventional Mortgage Loan

 

B-1

--------------------------------------------------------------------------------

 

20.

  

A code indicating whether the loan is an adjustable rate or fixed rate Mortgage
Loan

21.

  

Balloon Flag

22.

  

A code indicating the lien status of the Mortgage Loan

23.

  

Number of Units for the Mortgaged Property

24.

  

With respect to each adjustable rate Mortgage Loan, the Index Code

25.

  

With respect to each adjustable rate Mortgage Loan, the Gross Margin

26.

  

Next Interest Rate adjustment date

27.

  

Next Payment Change Date

28.

  

With respect to each adjustable rate Mortgage Loan, the interest rate adjustment
frequencies

29.

  

With respect to each adjustable rate Mortgage Loan, the Payment Adjustment
Frequency

30.

  

For each adjustable rate Mortgage Loan, the Mortgage Interest Rate adjustment
cap at all subsequent interest rate adjustment dates

31.

  

Periodic Payment Cap Percentage

32.

  

With respect to each adjustable rate Mortgage Loan, the lifetime mortgage
interest rate cap

33.

  

With respect to each adjustable rate Mortgage Loan, the lifetime mortgage
interest rate floor

34.

  

The primary mortgage insurance certificate number; a code indicating the method
of payment for mortgage insurance premiums and cost (Lender Paid PMI), if
applicable

35.

  

Lender or Borrower

36.

  

PMI Coverage Amount

37.

  

A code indicating whether the Mortgage Loan has a prepayment penalty

38.

  

A code indicating the prepayment penalty terms and the prepayment penalty amount
of the Mortgage Loan, if any

39.

  

A code indicating if the Mortgage Loan is a Section 32 Loan

 

B-2

--------------------------------------------------------------------------------

 

40.

  

Loans #/Credit Grade

41.

  

The Mortgagor’s credit risk score (FICO score)

42.

  

The debt-to income Ratio

 

 

B-3

--------------------------------------------------------------------------------

 

EXHIBIT C

 

CONVERSION LOAN PURCHASE DETAIL FIELDS

 

1.

  

Borrower’s Name

2.

  

Loan Number

3.

  

Face Amount

4.

  

Investor

5.

  

Commitment Number

6.

  

Price

7.

  

Commitment Expiration Date

8.

  

Delivery Date

9.

  

Funding Date

10.

  

Seller’s Account Number

 

 

C-1

--------------------------------------------------------------------------------

EXHIBIT D

 

WITHDRAWAL/DEPOSIT NOTICE: CASH ACCOUNT  

(ON SELLER’S LETTERHEAD)

 

Please process a wire transfer representing a:  

(Please check appropriate box)

 

WITHDRAWAL

  

¨

 

DEPOSIT

  

¨

 

 

From/To our Cash Account in the amount of $            on [Date].

 

The funds should be transferred in accordance with the following instructions:

 

Bank Name:

City, State:

ABA #:

Account #:

Account Name:

Ref: Crescent Mortgage Services, Inc.

 

Deposits only require “Bank Name” and “City, State” information to be completed.

 

CRESCENT MORTGAGE SERVICES, INC.*

By:

 

 

--------------------------------------------------------------------------------

Name:

 

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

*   The authorized officer of each Seller executing this letter must also have
executed the Cash Account Wire Instructions.

 

D-1

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EXHIBIT E

 

[CASH ACCOUNT WIRE INSTRUCTIONS]  

(ON SELLER’S LETTERHEAD)

 

[Date]

 

UBS Warburg Real Estate Securities Inc.

1285 Avenue of the Americas

New York, New York 10019

 

Re:    Mortgage Loan Repurchase Program

 

Ladies and Gentlemen:

 

Set forth below are Crescent Mortgage Services, Inc.’s wire instructions
applicable to the above referenced Mortgage Loan Repurchase Program with
Crescent Mortgage Services, Inc.

 

Wire Instructions:

 

Wire location No. 1

--------------------------------------------------------------------------------

  

Wire location No. 2

--------------------------------------------------------------------------------

            Bank Name:

  

        Bank Name:

            City, State:

  

        City, State:

            ABA #:

  

        ABA #:

            Account #:

  

        Account #:

            Account Name:

  

        Account Name:

            Ref:

  

        Ref:

 

Please acknowledge receipt of this letter in the space provided below. This
letter supersedes and replaces any prior notice specifying our Cash Account Wire
Instructions for the Mortgage Loan Repurchase Program and shall remains in
effect until superseded and replaced by a letter, in the form of this letter,
executed by us and acknowledged by you.

 

Very truly yours,

 

CRESCENT MORTGAGE SERVICES, INC.*

 

--------------------------------------------------------------------------------

*   Please add additional signatures of any person authorized to execute a Cash
Account Withdrawal/Deposit Notice. Only authorized persons who have executed
this letter may execute a Cash Account Withdrawal/Deposit Notice.

 

E-1

--------------------------------------------------------------------------------

 

By:

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

Receipt acknowledged by

 

UBS WARBURG REAL ESTATE SECURITIES INC.

 

By:

 

 

--------------------------------------------------------------------------------

Name:

   

Title:

   

 

E-2

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EXHIBIT F

 

[CASH ACCOUNT ADJUSTMENT NOTICE]

 

[Date]

 

To: CRESCENT MORTGAGE SERVICES, INC.

 

Re: CRESCENT MORTGAGE SERVICES, INC.’S CASH ACCOUNT #[            ]

 

A journal entry will be processed today reflecting the following adjustment to
your Cash Account.

 

¨   CREDIT OF $            

 

¨   DEBIT OF $            

 

Explanation is as follows:

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

Upon request, additional backup documentation will be provided.

 

Very truly yours,

UBS WARBURG REAL ESTATE SECURITIES INC.

By:

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

F-1

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EXHIBIT G

 

[INTENTIONALLY LEFT BLANK]

 

G-1

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EXHIBIT H

 

PURCHASER’S WIRE INSTRUCTIONS TO SELLER

 

Wire Instructions:

 

Bank Name:

City, State:

ABA #:

Account #:

Account Name:

Ref: Crescent Mortgage Services, Inc.

 

H-1

--------------------------------------------------------------------------------

 

EXHIBIT I

 

UCC-1 FINANCING STATEMENT

 

attached to and made part of Uniform Commercial Code (“UCC”)

Financing Statement, Form UCC-1

 

Debtor:

  

Crescent Mortgage Services, Inc.

    

115 Perimeter Center Place

    

Suite 285

    

Atlanta, Georgia 30346

    

Attention: Mike Leddy

Secured Party:

  

UBS Warburg Real Estate Securities Inc.

    

1285 Avenue of the Americas, 11th Floor

    

New York, NY 10019

    

Attention: Robert Carpenter

 

This Financing Statement is filed for precautionary purposes only.

 

The parties intend that the transactions under the Agreement constitute absolute
assignments.

 

The UCC Financing Statement, Form UCC-1, to which this Annex 1 is attached and
forms a part, covers all of the Debtor’s right, title and interest in, to and
under the Collateral (as defined below), whether now owned or hereafter
acquired, now existing or hereafter created and wherever located, including,
without limitation, all “accounts,” “chattel paper”, “general intangibles”,
“instruments” or “investment property” (in each case as defined in the Uniform
Commercial Code as in effect from time to time) constituting or relating to the
Collateral, and any and all substitutions and exchanges for, and products and
proceeds of, the foregoing.

 

As used herein, the following terms shall have the following meanings:

 

“Agreement”: The Amended and Restated Mortgage Loan Repurchase Agreement, dated
as of January 31, 2003, between the Secured Party and the Debtor.

 

“Cash Account”: A separate cash account established and maintained by the Debtor
at UBS Warburg Real Estate Securities Inc. under the conditions set forth in
Section 5 of the Agreement.

 

“Collateral”: Each of the following items or types of property, whether now
owned or hereafter acquired, now existing or hereafter created and wherever
located: the Mortgage Loans, all mortgage loan documents, including without
limitation all promissory notes, all servicing records, servicing agreements and
any other collateral pledged or otherwise relating to such Mortgage Loans,
together with all files, documents, instruments, surveys, certificates,
correspondence, appraisals, computer programs, computer storage media,
accounting records and

 

I-1

--------------------------------------------------------------------------------

other books and records relating thereto, all Interest Rate Protection
Agreements relating to such Mortgage Loans, all mortgage guaranties and
insurance (issued by governmental agencies or otherwise) and any mortgage
insurance certificate or other document evidencing such mortgage guaranties or
insurance relating to any Mortgage Loan, all Servicing Rights relating to the
Mortgage Loans, any servicing accounts established pursuant to any Servicing
Agreement and all amounts on deposit therein, from time to time, all purchase
agreements or other agreements or contracts relating to, constituting, or
otherwise governing, any or all of the foregoing to the extent they relate to
the Mortgage Loans, including the right to receive principal and interest
payments with respect to the Mortgage Loans and the right to enforce such
payments, the Cash Account and all monies from time to time on deposit in the
Cash Account, the Custodial Account and all monies from time to time on deposit
in the Custodial Account, all “general intangibles”, “accounts”, “chattel
paper”, “instruments” and “investment property” as defined in the Uniform
Commercial Code relating to or constituting any and all of the foregoing, and
any and all replacements, substitutions, distributions on or proceeds of any and
all of the foregoing.

 

“Custodial Account”: A separate custodial account, established and maintained by
the Debtor under the conditions set forth in Section 6(b) of the Agreement, for
the deposit by the Debtor of all collections in respect of a Mortgage Loan that
are payable to the Secured Party as the owner of the Mortgage Loan.

 

“Interest Rate Protection Agreement”: With respect to any or all of the Mortgage
Loans, any short sale of US Treasury securities, or futures contracts, or
options related contracts, or interest rate swap, cap or collar agreement or
similar arrangement providing for protection against fluctuations in interest
rates or the exchange of nominal interest obligations either generally or under
specific contingencies and acceptable to Purchaser.

 

“Mortgage Loan”: A one-to-four family residential mortgage loan that is
underwritten in accordance with Seller’s Underwriting Guidelines and is subject
to the Agreement.

 

“Seller’s Underwriting Guidelines”: Seller’s Underwriting Guidelines, as listed
in Exhibit T to the Agreement.

 

“Servicing Agreement”: The servicing agreement referred to in Section 13 of the
Agreement.

 

“Servicing Rights”: Any and all of the following: (a) any and all rights to
service the Mortgage Loans; (b) any payments to or monies received by any Debtor
for servicing the Mortgage Loans; (c) any late fees, penalties or similar
payments with respect to the Mortgage Loans; (d) all agreements or documents
creating, defining or evidencing any such servicing rights to the extent they
relate to such servicing rights and all rights of any Debtor thereunder; (e)
escrow payments or other similar payments with respect to the Mortgage Loans and
any amounts actually collected by any Debtor with respect thereto; and (f) all
accounts and other rights to payment related to any of the property described
herein.

 

Filing Office(s)

[Jurisdiction]

 

I-2

--------------------------------------------------------------------------------

 

EXHIBIT J

 

SELLER’S DELIVERY INSTRUCTIONS

 

(ON SELLER’S LETTERHEAD)

 

UBS Warburg Real Estate Securities Inc.

1285 Avenue of the Americas

New York, New York 10019

 

Re: Mortgage Loan Repurchase Program

 

Loan #

 

Last Name

 

Face Amount

 

 

 

 

Upon your receipt of the Repurchase Price for the above-referenced Mortgage
Loan, please promptly instruct Custodian to deliver the related Submission
Package to:

 

[ADDRESS]

 

by: [METHOD OF DELIVERY]

 

Very truly yours,

CRESCENT MORTGAGE SERVICES, INC.

By:

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

J-1

--------------------------------------------------------------------------------

 

EXHIBIT K

 

SELLER’S RELEASE

 

(ON SELLER’S LETTERHEAD)

 

[Date]

 

UBS Warburg Real Estate Securities Inc.

1285 Avenue of the Americas

New York, NY 10019

 

Ladies and Gentlemen:

 

With respect to the mortgage loans referenced on the attached list (a) we hereby
certify to you that the mortgage loans are not subject to a lien of any
warehouse lender and (b) we hereby release all right, interest or claim of any
kind with respect to such mortgage loans, such release to be effective
automatically without further action by any party upon payment from UBS Warburg
Real Estate Securities Inc., in accordance with our wire instructions in effect
on the date of such payment, of an amount not less than the aggregate of the
face amounts of such mortgage loans less the discount set forth on the related
funding confirmation, in immediately available funds.

 

 

Very truly yours,

CRESCENT MORTGAGE SERVICES, INC.*

By:

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

*   The authorized officer of each Seller executing this letter must also have
executed Seller’s Wire Instructions.

 

K-1

--------------------------------------------------------------------------------

 

EXHIBIT L

 

SELLER’S WIRE INSTRUCTIONS

(ON SELLER’S LETTERHEAD)

 

[Date]

 

UBS Warburg Real Estate Securities Inc.

1285 Avenue of the Americas

New York, New York 10019

 

Re: Mortgage Loan Repurchase Program

 

Ladies and Gentlemen:

 

Set forth below are Crescent Mortgage Services, Inc.’s wire instructions
applicable to the above-referenced Mortgage Loan Repurchase Program with
Crescent Mortgage Services, Inc.

 

Wire Instructions:

 

Bank Name:

City, State:

ABA #:

Account #:

Account Name:

 

Please acknowledge receipt of this letter in the space provided below. This
letter supersedes and replaces any prior notice specifying our Mortgage Loan
Repurchase Program wire instructions and shall remain in effect until superseded
and replaced by a letter, in the form of this letter, executed by us and
acknowledged by you.

 

 

Very truly yours,

CRESCENT MORTGAGE SERVICES, INC.*

By:

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

Receipt acknowledged by

 

--------------------------------------------------------------------------------

*   Please add additional signatures of any person authorized to execute a
Seller’s Release. Only authorized persons who have executed this letter may
execute a Seller’s Release.

 

L-1

--------------------------------------------------------------------------------

UBS WARBURG REAL ESTATE SECURITIES INC.

 

By:

 

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

L-2

--------------------------------------------------------------------------------

 

EXHIBIT M

 

WAREHOUSE LENDER’S RELEASE

(ON WAREHOUSE LENDER’S LETTERHEAD)

 

[Date]

 

UBS Warburg Real Estate Securities

1285 Avenue of the Americas

New York, New York 10019

 

Ladies and Gentlemen:

 

We hereby release all right, interest or claim of any kind with respect to the
mortgage loans referenced on the attached loan list, such release to be
effective automatically without any further action by any party, upon receipt,
in one or more installments, from UBS Warburg Real Estate Securities Inc., in
accordance with the wire instructions which we delivered to you in a letter
dated                     , 200  , of an amount not less than the aggregate of
the face amounts of such mortgage loans less the discount set forth on the
related funding confirmation, in immediately available funds.

 

 

Very truly yours,

[WAREHOUSE LENDER]*

By:

 

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

*   The authorized officer of each Warehouse Lender executing this letter must
also have executed the Warehouse Lender’s Wire Instructions.

 

M-1

--------------------------------------------------------------------------------

 

EXHIBIT N

 

AUTHORIZED SIGNATURES OF SELLER

 

I,                         , hereby certify that I am the duly elected [Vice]
President of                      Crescent Mortgage Services, Inc., a state
chartered institution organized under the laws of the state of Georgia (the
“Company”) and each person listed below who, as an officer or representative of
the Company, signed (a) the Amended and Restated Mortgage Loan Repurchase
Agreement, dated as of January 31, 2003, between the Company and UBS Warburg
Real Estate Securities Inc., (b) the Custodial Agreement and (c) any other
document delivered or on the date hereof in connection with any purchase
described in the agreements set forth above was, at the respective times of such
signing and delivery, and is now, a duly elected or appointed, qualified and
acting officer or representative of the Company, who holds the office set forth
opposite his or her name, and the signatures of such persons appearing on such
documents are their genuine signatures and that each of such person is, and
until further notice will be, duly elected or appointed, qualified and acting
officer or representative of the Company authorized to sign any Requests for
Purchase.

 

--------------------------------------------------------------------------------

Name and Title

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Name and Title

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Name and Title

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Name and Title

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Name and Title

  

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of the
Company.

 

Dated:

 

 

--------------------------------------------------------------------------------

     

By:

 

--------------------------------------------------------------------------------

           

Name:

 

 

--------------------------------------------------------------------------------

[Seal]

         

Title:

 

[Vice] President

 

I,                      , an [Assistant] Secretary of                     
Crescent Mortgage Services, Inc., hereby certify that                      is
the duly elected, qualified and acting [Vice] President of the Company and that
the signature appearing above is [her] [his] genuine signature.

 

N-1

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, I have hereunto signed my name.

 

Dated:

 

 

--------------------------------------------------------------------------------

     

By:

 

--------------------------------------------------------------------------------

           

Name:

 

 

--------------------------------------------------------------------------------

           

Title:

 

[Assistant] Secretary

 

 

N-2

--------------------------------------------------------------------------------

 

EXHIBIT O

 

WAREHOUSE LENDER’S WIRE INSTRUCTIONS

(ON WAREHOUSE LENDER’S LETTERHEAD)

 

[Date]

 

UBS Warburg Real Estate Securities Inc.

1285 Avenue of the Americas

New York, New York 10019

 

Re: Mortgage Loan Repurchase Program

 

Ladies and Gentleman:

 

Set forth below are the [Warehouse Lender’s] wire instructions applicable to the
above-referenced Mortgage Loan Repurchase Program with Crescent Mortgage
Services, Inc.

 

Wire Instructions:

 

Bank Name:

City, State:

ABA #:

Account #:

Account Name:

 

Please acknowledge receipt of this letter in the space provided below. This
letter supersedes and replaces any prior notice specifying the name of
[Warehouse Lender] and setting forth wire instructions and shall remain in
effect until superseded and replaced by a letter, in the form of this letter,
executed by us and acknowledged by you.

 

Very truly yours,

CRESCENT MORTGAGE SERVICES, INC.

By:

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

O-1

--------------------------------------------------------------------------------

 

[Warehouse Lender(s)]*

 

By:

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

Receipt acknowledged by

UBS WARBURG REAL ESTATE SECURITIES INC.

     

By:

 

 

--------------------------------------------------------------------------------

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

*   Please add additional signatures of any person authorized to execute a
Warehouse Lender’s Release. Only authorized persons who have executed this
letter may execute a Warehouse Lender’s Release

 

O-2

--------------------------------------------------------------------------------

 

EXHIBIT P

 

MBS SWAP FUNDING PROGRAM SELECTION NOTICE

(ON SELLER’S LETTERHEAD)

 

[Date]

 

UBS Warburg Real Estate Securities Inc.

1285 Avenue of the Americas

New York, New York 10019

 

Re:    Mortgage Loan Repurchase Program

 

With respect to the Mortgage Loan(s) referenced below we hereby certify that we
will offer to sell such Mortgage Loan(s) to you, pursuant to the MBS Swap
Funding Program, concurrently with our repurchase of such Mortgage Loan(s) under
the terms of the Mortgage Loan Repurchase Program’s Amended and Restated
Mortgage Loan Repurchase Agreement.

 

Loan #

 

Borrower Name

 

Face Amount

  

PWRES Fund Date

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

 

 

Very truly yours,

CRESCENT MORTGAGE SERVICES, INC.

By:

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

 

P-1

--------------------------------------------------------------------------------

EXHIBIT Q

 

REQUEST FOR MORTGAGE LOAN SHIPMENT

(ON SELLER’S LETTERHEAD)

 

JPMorgan Chase Bank

Mortgage Banking Division

2 Chase Manhattan Plaza (20th Floor)

New York, New York 10081

Attention: Glenn Hett

 

[Date]

 

Re: Mortgage Loan Repurchase Program

 

With respect to the Mortgage Loan(s) referenced below we hereby certify that (a)
such Mortgage Loan(s) shall be pooled under the related Agency Pool Number or
Contract Number (b) that the MBS Swap Conversion Documents have been executed in
accordance with the MBS Swap Funding Program and (c) that we shall deliver to
UBS Warburg Real Estate Securities Inc. the MBS Swap Submission Package within
five Business Days of the date of this letter. Please deliver the Mortgage
Loan(s) referenced below, via overnight courier, to the delivery location
specified below under cover of a bailee letter.

 

Agency

  

--------------------------------------------------------------------------------

Agency Pool Number (Freddie Mac Contract Number)

  

--------------------------------------------------------------------------------

Pool Face

  

--------------------------------------------------------------------------------

Coupon

  

--------------------------------------------------------------------------------

PSA Settlement Date

  

--------------------------------------------------------------------------------

 

Loan #

  

Borrower’s Name

  

Face Amount

  

Note
Rate

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

    

Delivery Totals:

              

Number of Loans:                

              

Face Amount:

  

--------------------------------------------------------------------------------

    

 

Delivery Location:

  

Document Custodian’s Name

    

Department Name

    

Street Address, Ste. or Floor #

    

City, State Zip Code

    

ATTN: Jane/John Doe

 

Q-1

--------------------------------------------------------------------------------

 

Please note that this request has been approved, as indicated below, by UBS
Warburg Real Estate Securities Inc.

 

 

Very truly yours,

CRESCENT MORTGAGE SERVICES, INC.

By:

 

--------------------------------------------------------------------------------

Name:

 

--------------------------------------------------------------------------------

Title:

 

--------------------------------------------------------------------------------

 

Approved by

 

UBS WARBURG REAL ESTATE SECURITIES INC.

By:

 

 

--------------------------------------------------------------------------------

Name:

   

Title:

   

 

Q-2

--------------------------------------------------------------------------------

 

EXHIBIT R

 

MBS SWAP SHIPMENT DOCUMENTS

 

These documents must be delivered by Seller to Purchaser via facsimile
transmission, prior to Purchaser’s carrying out Seller’s instructions as per the
Request for Mortgage Loan Shipment:

 

(i)

  

a Request for Mortgage Loan Shipment,

(ii)

  

Form HUD 11705 for GNMA Securities,

(iii)

  

Fannie Mae Form 2014 for Fannie Mae Securities, and

(iv)

  

Freddie Mac Form 381 and Form 939 for Freddie Mac Securities.

 

 

R-1

--------------------------------------------------------------------------------

 

EXHIBIT S

 

FORM OF CLOSING INSTRUCTION LETTER INSERT

 

1. The [Closing Agent] and the Crescent Mortgage Services, Inc. hereby
acknowledge that they are holding the closing funds in trust for UBS Warburg
Real Estate Securities Inc. (the “Purchaser”) until such time as the funds are
disbursed in accordance herewith and if the mortgage loan is not funded by the
close of business on the business day on which the closing funds were reviewed,
the closing funds shall be returned to Purchaser via federal funds wire transfer
to: Account No. 930-1-035581, for the account of UBS Warburg Conduit Funding,
JPMorgan Chase Bank, ABA No. 021000021, no later than 12:00 noon, New York City
time, on the business day after the scheduled closing date.

 

2. Prior to funding the mortgage loan, you shall have received a copy of the
title insurance policy (or a binding commitment of the title company therefor)
covering at least the face amount of the Mortgage Note, and insuring the
mortgage or deed of trust as a lien on the related property written by a title
company.

 

3. Upon the funding of the Mortgage Loan, all of the documents and files
relating to such Mortgage Loan shall be the property of Purchaser, and you
hereby agree to act as Purchaser’s agent, custodian and bailee for such time as
you are holding the same. You are instructed at such time to deliver the
mortgage loan documents and files directly to [the Custodian] for receipt no
later than the fifth (5th) business day following the date of origination of a
mortgage loan; provided that if Seller requires the mortgage loan documents and
files to be delivered to such other address, Seller hereby agrees that it holds
such files on behalf of Purchaser and that Seller shall deliver the mortgage
loan documents and files to [the Custodian] for receipt no later than the fifth
(5th) business day following the date of origination of a mortgage loan.

 

These instructions shall be irrevocable and can only be modified with the
approval in writing of Purchaser.

 

S-1

--------------------------------------------------------------------------------

 

EXHIBIT T

 

SELLER’S UNDERWRITING GUIDELINES

 

 

T-1

--------------------------------------------------------------------------------

EXHIBIT U

 

FORM OF OPINION

 

UBS Warburg Real Estate Securities

1285 Avenue of the Americas

New York, NY 10019

 

Dear Sirs and Mesdames:

 

You have requested our opinion as counsel to Crescent Mortgage Services, Inc. a
corporation organized and existing under the laws of Georgia (the “Seller”),
with respect to certain matters in connection with that certain Amended and
Restated Mortgage Loan Repurchase Agreement governing purchases and sales of
certain Mortgage Loans, dated January 31, 2003 (the “Repurchase Agreement”), by
and between Seller and UBS Warburg Real Estate Securities Inc. (the
“Purchaser”). The Repurchase Agreement and the Custodial Agreement are
hereinafter collectively referred to as the “Governing Agreements.” Capitalized
terms not otherwise defined herein have the meanings set forth in the Repurchase
Agreement.

 

[We] [I] have examined the following documents:

 

1. the Repurchase Agreement;

 

2. unfiled copies of the financing statements listed on Schedule 1
(collectively, the “Financing Statements”) naming the Seller as Debtor and the
Purchaser as Secured Party and describing the Mortgage Loans (as defined in the
Repurchase Agreement) as to which security interests may be perfected by filing
under the Uniform Commercial Code of the States listed on Schedule 1 (the
“Filing Collateral”), which I understand will be filed in the filing offices
listed on Schedule 1 (the “Filing Offices”);

 

3. the reports listed on Schedule 2 as to UCC financing statements
(collectively, the “UCC Search Report”);

 

4. such other documents, records and papers as we have deemed necessary and
relevant as a basis for this opinion.

 

To the extent [we] [I] have deemed necessary and proper, [we] [I] have relied
upon the representations and warranties of the Seller contained in the
Repurchase Agreement. [We] [I] have assumed the authenticity of all documents
submitted to me [us] as originals, the genuineness of all signatures, the legal
capacity of natural persons and the conformity to the originals of all
documents.

 

Based upon the foregoing, it is [our] [my] opinion that:

 

1. The Seller is a corporation duly organized, validly existing and in good
standing under the laws of the State of Georgia and is qualified to transact
business in, and is in good standing under, the laws of the [State
of                     ].

 

U-1

--------------------------------------------------------------------------------

2. The execution, delivery and performance by the Seller of the Governing
Agreements to which it is a party, and the sales by the Seller and the pledge of
the Mortgage Loans under the Repurchase Agreement have been duly authorized by
all necessary corporate action on the part of the Seller. Each of the Governing
Agreements have been executed and delivered by the Seller and are legal, valid
and binding agreements enforceable in accordance with their respective terms
against the Seller, subject to bankruptcy laws and other similar laws of general
application affecting rights of creditors and subject to the application of the
rules of equity, including those respecting the availability of specific
performance, none of which will materially interfere with the realization of the
benefits provided thereunder or with the Purchaser’s purchase of the Mortgage
Loans and/or security interest in the Mortgage Loans.

 

3. No consent, approval, authorization or order of, and no filing or
registration with, any court or governmental agency or regulatory body is
required on the part of the Seller for the execution, delivery or performance by
the Seller of the Governing Agreements to which it is a party or for the sales
by the Seller under the Repurchase Agreement or the sale of the Mortgage Loans
to the Purchaser and/or granting of a security interest to the Purchaser in the
Mortgage Loans, pursuant to the Repurchase Agreement.

 

4. The execution, delivery and performance by the Seller of, and the
consummation of the transactions contemplated by the Governing Agreements to
which it is a party do not and will not (a) violate any provision of the
Seller’s charter or by-laws, (b) violate any applicable law, rule or regulation,
(c) violate any order, writ, injunction or decree of any court or governmental
authority or agency or any arbitral award applicable to the Seller of which I
[we] have knowledge (after due inquiry) or (d) result in a breach of, constitute
a default under, require any consent under, or result in the acceleration or
required prepayment of any indebtedness pursuant to the terms of, any agreement
or instrument of which I have knowledge (after due inquiry) to which the Seller
is a party or by which it is bound or to which it is subject, or (except for the
Liens created pursuant to the Repurchase Agreement) result in the creation or
imposition of any Lien upon any Property of the Seller pursuant to the terms of
any such agreement or instrument.

 

5. There is no action, suit, proceeding or investigation pending or, to the best
of [our] [my] knowledge, threatened against the Seller which, in [our] [my]
judgment, either in any one instance or in the aggregate, would be reasonably
likely to result in any material adverse change in the properties, business or
financial condition, or prospects of the Seller or in any material impairment of
the right or ability of the Seller to carry on its business substantially as now
conducted or in any material liability on the part of the Seller or which would
draw into question the validity of the Governing Agreements to which it is a
party or the Mortgage Loans or of any action taken or to be taken in connection
with the transactions contemplated thereby, or which would be reasonably likely
to impair materially the ability of the Seller to perform under the terms of the
Governing Agreements to which it is a party or the Mortgage Loans.

 

6. The Repurchase Agreement is effective to create, in favor of the Purchaser,
either a valid sale of the Mortgage Loans to the Purchaser or a valid security
interest under the Uniform Commercial Code in all of the right, title and
interest of the Seller in, to and under the Mortgage Loans as collateral
security for the payment of the Seller’s obligations under the Repurchase
Agreement, except that (a) such security interests will continue in Mortgage

 

U-2

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Loans after its sale, exchange or other disposition only to the extent provided
in Section 9-306 of the Uniform Commercial Code, (b) the security interests in
Mortgage Loans in which the Seller acquires rights after the commencement of a
case under the Bankruptcy Code in respect of the Seller may be limited by
Section 552 of the Bankruptcy Code.

 

7. When the Mortgage Notes are delivered to the Custodian, endorsed in blank by
a duly authorized officer of the Seller, the security interest referred to in
Section 6 above in the Mortgage Notes will constitute a fully perfected first
priority security interest in all right, title and interest of the Seller
therein.

 

8. (a) Upon the filing of financing statements on Form UCC-1 naming the
Purchaser as “Secured Party” and the Seller as “Debtor”, and describing the
Mortgage Loans, in the jurisdictions and recording offices listed on Schedule 1
attached hereto, the security interests referred to in Section 6 above will
constitute fully perfected security interests under the Uniform Commercial Code
in all right, title and interest of the Seller in, to and under such Mortgage
Loans, which can be perfected by filing under the Uniform Commercial Code, or,
will demonstrate a completion of the sale of the Mortgage Loans to the
Purchaser.

 

(b) The UCC Search Report sets forth the proper filing offices and the proper
debtors necessary to identify those Persons who have on file in the
jurisdictions listed on Schedule 1 financing statements covering the Mortgage
Loans as of the dates and times specified on Schedule 2. The UCC Search Report
identifies no Person who has filed in any Filing Office a financing statement
describing the Mortgage Loans prior to the effective dates of the UCC Search
Report.

 

9. The Seller is not an “investment company”, or a company “controlled” by an
“investment company,” within the meaning of the Investment Company Act of 1940,
as amended.

 

 

Very truly yours,

 

U-3

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EXHIBIT V

 

UCC FILING JURISDICTIONS

 

[Seller’s principal place of business]

[Seller’s Jurisdiction of Incorporation]

 

V-1

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EXHIBIT W

 

FORM OF SERVICER NOTICE

 

                , 200

 

 

[SERVICER], as Servicer

[ADDRESS]

Attention:                            

 

  Re:   Amended and Restated Mortgage Loan Repurchase Agreement, dated as of
January 31, 2003 (the “Agreement”), by and between Crescent Mortgage Services,
Inc. (the “Seller”) and UBS Warburg Real Estate Securities Inc. (the
“Purchaser”)

 

Ladies and Gentlemen:

 

[SERVICER] (the “Servicer”) is servicing certain mortgage loans for the Seller
pursuant to certain Servicing Agreements between the Servicer and the Seller.
Pursuant to the Agreement between the Purchaser and the Seller, the Servicer is
hereby notified that the Purchaser has purchased from the Seller certain
mortgage loans.

 

Upon receipt of written notice from the Purchaser in which the Purchaser shall
identify the mortgage loans which are then owned by the Purchaser under the
Agreement (the “Mortgage Loans”), the Servicer shall segregate all amounts
collected on account of such Mortgage Loans, hold them in trust for the sole and
exclusive benefit of the Purchaser, and remit such collections in accordance
with the Purchaser’s written instructions. Following such notice, Servicer shall
follow the instructions of Purchaser with respect to the Mortgage Loans, and
shall deliver to Purchaser any information with respect to the Mortgage Loans
reasonably requested by Purchaser.

 

Notwithstanding any contrary information which may be delivered to the Servicer
by the Seller, the Servicer may conclusively rely on any information or notice
delivered by the Purchaser, and the Seller, shall indemnify and hold the
Servicer harmless for any and all claims asserted against it for any actions
taken in good faith by the Servicer in connection with the delivery of such
information or notice.

 

Please acknowledge receipt of this instruction letter by signing in the
signature block below and forwarding an executed copy to the Purchaser promptly
upon receipt. Any notices to the Purchaser should be delivered to the following
address:                                         
                                        
                                        
                                                                              
                   

 

Attention:                         , with a copy to                         ;
Telephone:                             Facsimile:                     

 

Very truly yours,

 

W-1

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CRESCENT MORTGAGE SERVICES, INC.

By:

 

 

--------------------------------------------------------------------------------

Name:

Title:

   

 

ACKNOWLEDGED:

                                                             , as Servicer

 

By:

 

 

--------------------------------------------------------------------------------

Name:

Title:

Telephone:

Facsimile:

   

 

W-2

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EXHIBIT X

 

FORM OF COVENANT COMPLIANCE LETTER

 

                        , 200

 

UBS Warburg Real Estate Securities

1285 Avenue of the Americas, 11th Floor,

New York, New York 10019

Attention:                                

 

  Re:   Amended and Restated Mortgage Loan Repurchase Agreement, dated as of
January 31, 2003 (the “Agreement”), by and between Crescent Mortgage Services,
Inc. (the “Seller”) and UBS Warburg Real Estate Securities Inc. (the
“Purchaser”)

 

Dear Sirs and Mesdames:

 

In connection with the Agreement, I,                     , a [Title] of the
Seller do hereby certify to the Purchaser as follows:

 

(a) The Seller’s Tangible Net Worth is $                                    ,
which is not less than the greater of (i) $10,000,000 measured on a quarterly
basis (as at the end of each month) and (ii) (A) 85% of the Tangible Net Worth
of the Seller at the end of the most recently completed fiscal year of the
Seller plus (B) 90% of capital contributions made during such fiscal year plus
(C) 50% of positive year to date net income.

 

(b) The Seller’s ratio of Total Indebtedness to Tangible Net Worth is
[                    ], which is not greater than [            ].

 

(c) The Seller’s Net Income for the last three consecutive fiscal months, before
income taxes for such Test Period and distributions made during such Test Period
is {$                    ], which is not less than $1.00.

 

(d) The aggregate Tangible Net Worth of Seller is $                        ,
which is not less than $10,000,000.

 

By:

 

 

--------------------------------------------------------------------------------

Name:

Title:

   

 

X-1

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EXHIBIT Y

 

FORM OF REQUEST FOR PURCHASE

 

Amended and Restated Mortgage Loan Repurchase Agreement, dated as of January 31,
2003 (the “Agreement”), by and between the Seller and UBS Warburg Real Estate
Securities Inc. (the “Purchaser”),

 

Purchaser:                                 UBS Warburg Real Estate Securities
Inc.

Seller:                                         Crescent Mortgage Services, Inc.

Requested Funding Date:

   

Number of Mortgages

   

Grid Reference Number                

 

Loans to be Purchased:

 

Unpaid principal balance:            $

 

Requested Wire Amount:            $

 

[I] hereby certify as an [Officer of Crescent Mortgage Services, Inc.] that the
following conditions are true and accurate:

 

1. No Default or Event of Default has occurred and is continuing on the date
hereof.

 

2. Each of the representations and warranties made by the Seller in or pursuant
to the Agreement is true and correct in all material respects on and as of such
date as if made on and as of the date hereof.

 

3. The Seller is in compliance with all governmental licenses and authorizations
and is qualified to do business and is in good standing in all required
jurisdictions.

 

4. The wire instructions listed on the Loan Detail [Grid Reference Number] are
true and correct.

 

All Capitalized terms used herein shall have the meanings set forth in the
Agreement.

 

Requested and certified to by:

 

CRESCENT MORTGAGE SERVICES, INC.

 

Y-1

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FIRST AMENDMENT TO THE

MORTGAGE LOAN REPURCHASE AGREEMENT

 

FIRST AMENDMENT, dated as of April 8, 2003 (the “Amendment”), to the Amended and
Restated Mortgage Loan Repurchase Agreement, dated as of January 31, 2003 (as
amended, supplemented or otherwise modified prior to the date hereof, the
“Existing Mortgage Loan Repurchase Agreement”), between UBS WARBURG REAL ESTATE
SECURITIES INC. (the “Purchaser”) and CRESCENT MORTGAGE SERVICES, INC. (the
“Seller”).

 

RECITALS

 

The Seller has requested the Purchaser to agree to amend certain provisions of
the Existing Mortgage Loan Repurchase Agreement, as set forth in this Amendment.
The Purchaser is willing to agree to such amendments, but only on the terms and
subject to the conditions set forth in this Amendment.

 

NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Seller and the Purchaser hereby agree as follows:

 

ARTICLE I

 

Definitions:

 

Unless otherwise indicated, capitalized terms that are used but not defined
herein shall have the meanings ascribed to them in the Amended and Restated
Mortgage Loan Repurchase Agreement.

 

ARTICLE II

 

Amendments to Section 1 of the Existing Mortgage Loan Repurchase Agreement:

 

Section 1 of the Existing Mortgage Loan Repurchase Agreement is hereby amended
by deleting the definition of “Event of Default” in its entirety and
substituting in lieu thereof the following new definition:

 

“‘Event of Default’: The occurrence of any of the following events: (i) an Act
of Insolvency with respect to Seller or Parent Company; (ii) any representation
or warranty made by Seller hereunder shall have been incorrect or untrue in any
material respect when made or when deemed to have been made; (iii) Seller shall
fail to perform, or shall admit to Purchaser its inability to, or its intention
not to, perform any of its obligations hereunder or under the Electronic
Tracking Agreement; (iv) an event or events shall have occurred resulting in the
effective absence of a “repo market” or comparable “lending market” for
financing debt obligations secured by mortgage loans or securities or an event
or events shall have occurred resulting in the Purchaser not being able to
finance

--------------------------------------------------------------------------------

 

any Mortgage Loans through the “repo market” or “lending market” with
traditional counterparties at rates which would have been reasonable prior to
the occurrence of such event or events; (v) an event or events shall have
occurred resulting in the effective absence of a “securities market” for
securities backed by mortgage loans or an event or events shall have occurred
resulting in the Purchaser not being able to sell securities backed by mortgage
loans at prices which would have been reasonable prior to such event or events;
(vi) there shall have occurred a material adverse change in the “repo market” or
comparable “lending market” or in the financial condition of the Purchaser which
effects (or can reasonably be expected to effect) materially and adversely the
ability of the Purchaser to fund its obligations under this Agreement; (vii) the
Seller or any of the Seller’s Affiliates shall be in default beyond any
applicable grace period under any note, indenture, loan agreement, guaranty,
swap agreement or any other contract to which it is a party; (viii) the Seller
shall fail to comply with the requirements of any of Section 7(h), Sections
11(a) through 11(c) (inclusive), Section 11(e), Section 11(h) through 11(j)
(inclusive), Section 11(n) or Section 11(q); (viii)(a) the Seller shall fail to
comply with the requirements of any of Section 11(k) through Section 11(m)
(inclusive) or (b) the Seller shall fail to comply with the requirements on any
other subsection in Section 11 (other than those specifically enumerated in
preceding clause (vii) or (viii)(a)), and such default shall continue unremedied
for a period of three Business Days; (ix) if the Purchaser has purchased MERS
Designated Mortgage Loans, the Electronic Tracking Agreement has for whatever
reason been terminated or ceases to be in full force and effect and the
Purchaser (or the Custodian as its designee) shall not have received an
assignment of mortgage with respect to each MERS Designated Mortgage Loan, in
blank, in recordable form, but unrecorded; (x) any materially adverse change in
the Property, business, financial condition or prospects of the Seller or any of
its Affiliates shall occur, in each case as determined by the Purchaser in its
sole discretion, or any other condition shall exist which, in the Purchaser’s
sole discretion, constitutes a material impairment of the Seller’s ability to
perform its obligations under this Agreement or any other document in connection
herewith; or (xi) the discovery by the Purchaser of a condition or event which
existed at or prior to the execution hereof and which the Purchaser, in its sole
discretion, determines materially and adversely affects: (a) the condition
(financial or otherwise) of the Seller, its Subsidiaries or Affiliates; or (b)
the ability of either Seller or Purchaser to fulfill its respective obligations
under this Agreement.”

 

ARTICLE III

 

Amendments to Section 10 of the Existing Mortgage Loan Repurchase Agreement:

 

Section 10 of the Existing Mortgage Loan Repurchase Agreement is hereby amended
by deleting clause (a)(xi) in its entirety and substituting in lieu thereof the
following new clause (a)(xi):

 

“(xi) the aggregate Tangible Net Worth of Seller is not less than $18,000,000;”

 

-2-

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ARTICLE IV

 

Amendments to Section 11 of the Existing Mortgage Loan Repurchase Agreement:

 

Section 11 of the Existing Mortgage Loan Repurchase Agreement is hereby amended
by (i) deleting clause (k) in its entirety and substituting in lieu thereof the
following new clause (k):

 

“(k) Seller shall maintain a Tangible Net Worth which shall be not less than the
greater of (i) $18,000,000 measured on a quarterly basis (as at the end of each
month) and (ii) (A) 85% of the Tangible Net Worth of Seller at the end of the
most recently completed fiscal year of Seller plus (B) 90% of capital
contributions made during such fiscal year plus (C) 50% of positive year to date
net income.”

 

(ii) inserting the following clauses (q) and (r) immediately at the end thereof:

 

“(q) The Seller shall not at any time pay any fees to any Affiliate or declare
or pay any dividend or distribution on, or make any payment on account of, or
set apart assets for a sinking or other analogous fund for, the purchase,
redemption, defeasance, retirement or other acquisition of, any shares of any
class of capital stock of the Seller or any warrants or options to purchase any
such capital stock, whether now or hereafter outstanding, or make any other
distribution in respect thereof, either directly or indirectly, whether in cash
or property or in obligations of the Seller or any Subsidiary thereof, in each
case without the prior written consent of the Purchaser; provided, however, that
Seller may reimburse all reasonable service fees, but in any event not to exceed
$1,260,875 per year, for services provided by or through its Affiliates pursuant
to a written management agreement (the “Management Agreement”) with its
Affiliates (a copy of which is attached as Exhibit A hereto) and pay all amounts
owed in respect of Seller’s taxable income pursuant to a tax sharing agreement
(the “Tax Sharing Agreement”) among the Seller and its Affiliates ( a copy of
which is attached as Exhibit B hereto).

 

(r) The Seller shall not amend the Tax Sharing Agreement or any Management
Agreement without the prior consent of the Buyer (other than with respect to
amendments necessary to comply with changes to laws or regulatory requirements,
and provided that notice of any such amendments shall be provided to the Buyer
as soon as reasonably possible).”

 

ARTICLE V

 

Conditions to Effectiveness

 

This Amendment, and the modifications to the Existing Mortgage Loan Repurchase
Agreement provided for herein, shall become effective on the date on which all
of the following conditions have been satisfied:

 

-3-

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1. Amendment. The Purchaser shall have received this Amendment, executed and
delivered by a duly authorized officer of each party thereto.

 

2. Amendment to Purchase Agreement. The Purchaser shall have received the First
Amendment to the Amended and Restated Mortgage Loan Purchase Agreement between
Seller and Purchaser, executed and delivered by a duly authorized officer of
each party thereto.

 

3. Consents, Licenses, Approvals, Etc. The Seller represents and warrants, that
all consents, licenses and approvals, if any, required in connection with the
execution, delivery and performance by the Seller of, and the validity and
enforceability of, this Amendment, have been obtained and such consents,
licenses and approvals are in full force and effect.

 

ARTICLE IV

 

Miscellaneous

 

1. No Other Amendments. Except as expressly amended hereby, the Amended and
Restated Mortgage Loan Repurchase Agreement shall remain in full force and
effect in accordance with their respective terms, without any waiver, amendment
or modification of any provision thereof.

 

2. Counterparts. This Amendment may be executed by one or more of the parties
hereto on any number of separate counterparts and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.

 

3. Expenses. The Seller agrees to pay and reimburse the Purchaser for all of the
out-of-pocket costs and expenses incurred by the Purchaser in connection with
the preparation, execution and delivery of this Amendment, including, without
limitation, the reasonable fees and disbursements of Cadwalader, Wickersham &
Taft LLP, counsel to the Purchaser.

 

4. Applicable Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

[SIGNATURE PAGES FOLLOW]

 

-4-

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered as of the day and year first above written.

 

UBS WARBURG REAL ESTATE SECURITIES INC.

By:

Name

Title:

 

      /s/

--------------------------------------------------------------------------------

By:

Name:

Title:

 

      /s/

--------------------------------------------------------------------------------

By:

Name:

Title:

 

      /s/

--------------------------------------------------------------------------------

CRESCENT MORTGAGE SERVICES, INC.

By:

Name:

Title:

 

      /s/

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