Exhibit 10.1
EXECUTION VERSION
 
MORTGAGE LOAN PARTICIPATION SALE AGREEMENT
between
PHH MORTGAGE CORPORATION,
as Seller,
and
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
as Purchaser
September 2, 2010
 

 

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TABLE OF CONTENTS

                      Page   Section 1.  
Definitions
    3   Section 2.  
Purchases of Participation Certificates
    19   Section 3.  
Takeout Commitments
    21   Section 4.  
Issuance and Delivery of Participation Certificate
    21   Section 5.  
Mortgage Pool Servicing
    22   Section 6.  
Seller Covenants Regarding Transfer of Servicing
    28   Section 7.  
Intent of Parties; Security Interest
    30   Section 8.  
Conditions Precedent
    31   Section 9.  
Representations and Warranties
    33   Section 10.  
Covenants of Seller
    40   Section 11.  
Term
    49   Section 12.  
Exclusive Benefit of Parties; Assignment
    50   Section 13.  
Amendment; Waivers
    50   Section 14.  
Effect of Invalidity of Provisions
    50   Section 15.  
Governing Law; Waiver of Jury Trial
    50   Section 16.  
Notices
    51   Section 17.  
Execution in Counterparts
    51   Section 18.  
Confidentiality
    51   Section 19.  
Acknowledgments
    52   Section 20.  
Authorizations
    52   Section 21.  
Set-Off
    53   Section 22.  
Refund of Program Fee
    53   Section 23.  
Increased Costs
    53  

EXHIBITS

     
SCHEDULE I
  AUTHORIZATIONS
 
   
EXHIBIT A
  FORM OF TAKEOUT COMMITMENT ASSIGNMENT
 
   
EXHIBIT B
  RESERVED
 
   
EXHIBIT C
  SELLER’S WIRE TRANSFER INSTRUCTIONS
 
   
EXHIBIT D
  RESERVED
 
   
EXHIBIT E
  SCHEDULE OF SELLER’S INDEBTEDNESS
 
   
EXHIBIT F
  FORM OF SELLER’S OFFICER’S CERTIFICATE
 
   
EXHIBIT G
  PERMITTED AFFILIATE TRANSACTIONS

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MORTGAGE LOAN PARTICIPATION SALE AGREEMENT
          This is a MORTGAGE LOAN PARTICIPATION SALE AGREEMENT (“Agreement”),
dated as of September 2, 2010 between JPMorgan Chase Bank, National Association
(“Purchaser”) and PHH Mortgage Corporation (“Seller”).
R E C I T A L S
          WHEREAS, Seller desires to sell from time to time to Purchaser all of
Seller’s right, title and interest in and to designated pools of fully
amortizing first lien residential Mortgage Loans (defined below) (each such pool
of Mortgage Loans so purchased and sold, a “Mortgage Pool”), each in the form of
a 100% participation interest evidenced by a Participation Certificate, and
Purchaser, agrees to purchase such Participation Certificates evidencing such
participation interests from Seller in accordance with the terms and conditions
set forth in this Agreement and the Custodial Agreement. This Agreement is a
commitment to enter into transactions with an aggregate Purchase Price not to
exceed at any one time the Maximum Purchase Price.
          WHEREAS, Seller acknowledges that it will cause each Mortgage Pool
purchased hereunder as evidenced by a Participation Certificate to be converted
into an Agency Security relating to such Mortgage Pool, such Agency Security to
be backed by and to relate to the Mortgage Loans subject to the Mortgage Pools.
In furtherance thereof, Seller agrees to cause the related Agency Security to be
issued and delivered on or before the Settlement Date under the terms and
conditions provided herein.
          WHEREAS, Coincident with each Mortgage Pool purchase, Seller will have
validly assigned to Purchaser all of Seller’s rights and obligations under one
or more forward purchase commitments each evidencing an institution’s commitment
to purchase on a mandatory basis on a designated purchase date an agreed upon
principal amount of the related Agency Security.
          NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, Purchaser and Seller, intending to be legally
bound, hereby agree as follows:
          Section 1. Definitions.
          Capitalized terms used in this Agreement shall have the meanings
ascribed to them below. To the extent that defined terms are incorporated by
reference to another agreement, any capitalized terms therein, and the
definitions thereof, shall be incorporated by reference as well.
          “Accepted Servicing Practices”: With respect to each Mortgage Loan,
such standards which comply with the applicable standards and requirements
under: (i) an applicable Agency Program and related provisions of the applicable
Agency Guide pursuant to which the related Agency Security is intended to be
issued, and/or (ii) any applicable FHA and/or VA program and related provisions
of applicable FHA and/or VA servicing guidelines.

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          “Additional Collateral”: Shall have the meaning ascribed thereto in
Section 7(d) of this Agreement.
          “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 9(a)( xxiv) 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”: Respecting GNMA Securities, the GNMA Mortgage-Backed
Securities Guide; respecting Fannie Mae Securities, the Fannie Mae Selling Guide
and the Fannie Mae Servicing Guide; and respecting Freddie Mac Securities, the
Freddie Mac Sellers’ and Servicers’ Guide; in each case as such Agency Guide may
be amended from time to time and as such Agency Guide has been modified by the
applicable Agency for Seller.
          “Agency Program”: The specific mortgage-backed securities swap or
purchase program under the relevant Agency Guide or as otherwise approved by the
Agency pursuant to which the Agency Security for a given Transaction is to be
issued.
          “Agency Security”: A fully modified pass-through mortgage-backed
certificate guaranteed by GNMA, a guaranteed mortgage pass-through certificate
issued by Fannie Mae, or a mortgage participation certificate issued by Freddie
Mac, in each case representing or backed by the Mortgage Pool which is the
subject of a Transaction. The particular Agency Security for the relevant Agency
is alternatively referred to as: “GNMA Securities” (in the case of GNMA),
“Fannie Mae Securities” (in the case of Fannie Mae) and “Freddie Mac Securities”
(in the case of Freddie Mac).
          “Agency Security Face Amount”: The original unpaid principal balance
of the Agency Security.
          “Agency Security Issuance Deadline”: The date by which the Agency
Security must be issued and delivered to Purchaser, which, unless otherwise
agreed to by Purchaser as provided herein, shall occur no later than the
Settlement Date.
          “Agency Security Issuance Failure”: Failure of the Agency Security to
be issued due to or as a result of Seller’s failure to perform any of its
obligations under this Agreement or any other Program Document; provided that,
such failure shall not constitute an Agency Security Issuance Failure if the
failure of the Agency Security to be issued is due solely to an administrative
or ministerial failure and Seller cures such administrative or ministerial
failure within one (1) Business Day of such failure; provided further that such
failure shall not constitute

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an Agency Security Issuance Failure if Seller repurchases the Mortgage Pool in
accordance with Section 9(d) hereof.
          “Applicable Law”: All provisions of statutes, rules, regulations and
orders of governmental bodies or regulatory agencies applicable to a Person, and
all orders and decrees of all courts and arbitrators in proceedings or actions
in which the Person in question is a party.
          “Asset Securitization Subsidiary”: (i) Any Subsidiary engaged solely
in the business of effecting asset securitization transactions permitted by this
Agreement and activities incidental thereto or (ii) any Subsidiary whose primary
purpose is to hold title or ownership interests in vehicles, equipment, leases,
mortgages, relocation assets, financial assets and related assets under
management.
          “Available Borrowing Capacity”: Committed borrowing capacity which may
be drawn (taking into account required reserves and discounts) upon or has been
drawn upon by PHH Parent or any of its Subsidiaries under committed Mortgage
Warehouse Facilities.
          “Basic Collateral”: Shall have the meaning ascribed thereto in Section
7(c) of this Agreement.
          “Balance Sheet Fee”: As set forth in the Fee Letter.
          “Business Day”: Any day other than a Saturday, Sunday, and any other
day on which banking institutions in The City of New York or the jurisdiction in
which the Custodian’s custodial offices are located are authorized or obligated
by law to be closed.
          “Capital Lease”: As applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee which, in accordance
with GAAP, is or should be accounted for as a capital lease on the balance sheet
of that Person.
          “Change of Control”: Any of the following (i) the acquisition by any
Person or group (within the meaning of the Securities Exchange Act of 1934, as
amended, and the rules of the Securities and Exchange Commission thereunder as
in effect on the date hereof), directly or indirectly, beneficially or of
record, of ownership or control of in excess of 50% of the voting common stock
of PHH Parent on a fully diluted basis at any time, (ii) if at any time, PHH
Parent shall cease to own, directly or indirectly, 100% of the shares of Seller
or (iii) if at any time, individuals who on the date hereof constituted the
Board of Directors of PHH Parent (together with any new directors whose election
by such Board of Directors or whose nomination for election by the shareholders
of PHH Parent, as the case may be, was approved by a vote of the majority of the
directors then still in office who were either directors on the date hereof or
whose election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors of PHH Parent then
in office.
          “Code”: The Internal Revenue Code of 1986, as amended from time to
time.
          “Collateral”: Shall have the meaning ascribed thereto in Section 7(d)
of this Agreement.

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          “Collections”: With respect to any Mortgage Loan at any time, any
principal and/or interest thereon and all dividends, sale proceeds and other
collections and distributions thereon, but not including any Escrow Payments,
commitment fees and/or origination fees accrued in respect of periods on or
after the Purchase Date with respect to the related Participation Certificate.
          “Commitment Termination Date”: The earliest of (i) September 1, 2011,
and (ii) at Purchaser’s option, upon the occurrence of a Servicing Termination
Event.
          “Consolidated Assets”: For any Person, as of any date of
determination, the total assets of such Person and its Consolidated Subsidiaries
as of such date, determined in accordance with GAAP.
          “Consolidated Net Worth”: For any Person, as of any date of
determination, all amounts which would be included on a balance sheet of such
Person and its Consolidated Subsidiaries under stockholders’ equity as of such
date, determined in accordance with GAAP.
          “Consolidated Subsidiaries”: For any Person, all Subsidiaries of such
Person that are required to be consolidated with such Person for financial
reporting purposes in accordance with GAAP.
          “Custodial Account”: An account established pursuant to Section 5(c)
hereof.
          “Custodial Agreement”: The Custodial Agreement, dated as of the date
hereof, among Seller, Purchaser, the Custodian and solely for the purposes of
Section 3(a) to the Custodial Agreement, The Bank of New York Mellon, as amended
from time to time in accordance with the terms thereof.
          “Custodian”: The Bank of New York Mellon Trust Company, N.A. and its
successors shall be the Custodian under the Custodial Agreement.
          “Cut-off Date”: The first calendar day of the month in which the
Settlement Date is to occur.
          “Cut-off Date Principal Balance”: The outstanding principal balance of
the Mortgage Loans on the Cut-off Date after giving effect to payments of
principal and interest due on or prior to the Cut-off Date whether or not such
payments are received.
          “Deficient Mortgage Loans”: With respect to a Participation
Certificate, a Mortgage Loan that is not in compliance with Section 9(b) hereof.
          “Deficient Mortgage Pool”: With respect to a Participation
Certificate, a Mortgage Pool (i) with respect to which any related Mortgage Loan
is a Deficient Mortgage Loan or (ii) that is ineligible for acceptance by an
Agency in connection with the issuance of an Agency Security.
          “Designated Servicer”: Shall have the meaning ascribed thereto in
Section 5(f) of this Agreement.

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          “Discount Rate”: With respect to each Transaction, the percentage set
forth in the Fee Letter and on the applicable funding report delivered on the
Purchase Date plus the LIBOR Rate on such date of determination (which shall be
the related Purchase Date).
          “Electronic Tracking Agreement”: The Electronic Tracking Agreement,
dated as of the date hereof, among Seller, Purchaser, MERS and MERSCORP, Inc.,
in form and substance acceptable to the parties.
          “ERISA”: With respect to any Person, means the Employee Retirement
Income Security Act of 1974, as amended from time to time.
          “ERISA Affiliate”: Any corporation or trade or business that, together
with Seller is treated as a single employer under Section 414(b) or (c) of the
Code or solely for purposes of Section 302 of ERISA and Section 412 of the Code
is treated as single employer described in Section 414 of the Code.
          “Escrow Payments”: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rents, sewer rents,
municipal charges, mortgage insurance premiums, fire and hazard insurance
premiums, condominium charges, and any other payments required to be escrowed by
the related mortgagor with the mortgagee pursuant to the Mortgage or any other
related document.
          “Event of Insolvency”: For any Person means:
          (a) that such Person shall discontinue or abandon operation of its
business; or
          (b) that such Person shall fail generally to, or admit in writing its
inability to, pay its debts as they become due; or
          (c) a proceeding shall have been instituted in a court having
jurisdiction in the premises seeking a decree or order for relief in respect of
such Person in an involuntary case under any applicable bankruptcy, insolvency,
liquidation, reorganization or other similar law now or hereafter in effect, or
for the appointment of a receiver, liquidator, assignee, trustee, custodian,
sequestrator, conservator or other similar official of such Person, or for any
substantial part of its property, or for the winding-up or liquidation of its
affairs and such proceeding shall not have been dismissed for a period of 30
consecutive days; or
          (d) the commencement by such Person of a voluntary case under any
applicable bankruptcy, insolvency or other similar Requirement of Law now or
hereafter in effect, or such Person’s consent to the entry of an order for
relief in an involuntary case under any such Requirement of Law, or consent to
the appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator, conservator or other similar official of such
Person, or for any substantial part of its property, or any general assignment
for the benefit of creditors; or
          (e) that such Person shall become insolvent.

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          “Event of Termination”: With respect to Seller (a) with respect to any
Plan, a Reportable Event, or (b) the withdrawal of Seller or any ERISA Affiliate
thereof from a Plan during a plan year in which it is a substantial employer, as
defined in Section 4001(a)(2) of ERISA, or (c) the failure by Seller or any
ERISA Affiliate thereof to meet the minimum funding standard of Section 412 of
the Code or Section 302 of ERISA with respect to any Plan, including, without
limitation, the failure to make on or before its due date a required installment
under Section 430 (j) of the Code or Section 303 (j) of ERISA, or (d) the
distribution under Section 4041 of ERISA of a notice of intent to terminate any
Plan or any action taken by Seller or any ERISA Affiliate thereof to terminate
any Plan, or (e) the failure to meet requirements of Section 436 of the Code
resulting in the loss of qualified status under Section 401(a)(29) of the Code,
or (f) the institution by the PBGC of proceedings under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any Plan,
or (g) the receipt by Seller or any ERISA Affiliate thereof of a notice from a
Multiemployer Plan that action of the type described in the previous clause
(f) has been taken by the PBGC with respect to such Multiemployer Plan, or
(h) any event or circumstance exists which may reasonably be expected to
constitute grounds for Seller or any ERISA Affiliate thereof to incur liability
under Title IV of ERISA or under Sections 412 (b) or 430 (k) of the Code with
respect to any Plan.
          “Existing Mortgage Warehouse Facilities”: The mortgage warehouse
facilities listed on Schedule 5.1(c) to the Revolving Credit Facility as of the
Revolver Fourth Amendment Effective Date along with the $500,000,000 gestation
facility with Bank of America, N.A.
          “Expenses”: All present and future expenses incurred by or on behalf
of the Purchaser in connection with this Agreement or any of the other Program
Documents and any amendment, supplement or other modification or waiver related
hereto or thereto, whether incurred heretofore or hereafter, including without
limitation, reasonable attorneys’ fees.
          “Fannie Mae Securities”: The meaning ascribed to such term in the
definition of “Agency Security” herein.
          “Fee Letter”: That certain fee letter between Purchaser and Seller,
dated as of the date hereof.
          “FHA”: The Federal Housing Administration.
          “FHA Insurance Contract”: The contractual obligation of FHA respecting
the insurance of an FHA Loan pursuant to the National Housing Act, as amended.
          “FHA Loan”: A Mortgage Loan that is, or will be, the subject of an FHA
Insurance Contract and is, or will be, evidenced by a Mortgage Insurance
Certificate.
          “FHA Regulations”: The regulations promulgated by HUD under the
National Housing Act, codified in 24 Code of Federal Regulations, and other HUD
issuances relating to FHA Loans, including the related handbooks, circulars,
notices and mortgagee letters, and all amendments and additions thereto.
          “Fidelity Insurance”: Insurance coverage with respect to employee
errors, omissions, dishonesty, forgery, theft, disappearance and destruction,
robbery and safe burglary,

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property (other than money and securities) and computer fraud in an aggregate
amount acceptable to the Agencies.
          “Fleet Asset Securitization Facilities”: The asset-backed financing
arrangements relating to the securitization of vehicle fleet leases originated
and serviced by an Affiliate of the Seller as more fully described in (i) that
certain Amended and Restated Base Indenture, dated as of December 17, 2008,
between Chesapeake Funding LLC, as Issuer, and JPMorgan Chase Bank, N.A., as
Indenture Trustee, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof, and such other
program documents relating thereto, and (ii) that certain Trust Indenture dated
as of November 16, 2009, between BNY Trust Company of Canada as issuer trustee
of Fleet Leasing Receivables Trust and ComputerShare Trust Company Of Canada, as
amended, supplemented or otherwise modified from time to time in accordance with
the terms thereof and such other program documents relating thereto.
          “Freddie Mac Securities”: The meaning ascribed to such term in the
definition of “Agency Security” herein.
          “GAAP”: Generally accepted accounting principles in the United States
of America, applied on a consistent basis and applied to both classification of
items and amounts, and shall include, without limitation, the official
interpretations thereof by the Financial Accounting Standards Board, its
predecessors and successors.
          “GNMA Securities”: The meaning ascribed to such term in the definition
of “Agency Security” herein.
          “Good Delivery”: The meaning ascribed to such term in the SIFMA Guide
in connection with the standard requirements for the delivery and settlement of
an Agency Security.
          “Government-Sponsored Enterprise”: (i) Fannie Mae, (ii) Freddie Mac,
(iii) GNMA or (iv) any other HUD entity.
          “Governmental Authority”: Any nation or government, any state, county,
municipality or other political subdivision thereof or any governmental body,
agency, authority, department or commission (including, without limitation, any
taxing authority) or any instrumentality or officer of any of the foregoing
(including, without limitation, any court or tribunal) exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government and any corporation, partnership or other entity directly or
indirectly owned by or controlled by the foregoing.
          “Guaranty”: With respect to any Person, any direct or indirect
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, Capital Lease, dividend or other monetary obligation (“primary
obligation”) of any other Person (the “primary obligor”) in any manner, whether
directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (a) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (b) to
advance or supply funds (i) for the purchase or payment of any such primary
obligation or (ii) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary

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obligor, (c) to purchase property, securities or services, in each case,
primarily for the purpose of assuring the owner of any such primary obligation
of the repayment of such primary obligation or (d) as a general partner of a
partnership or a joint venturer of a joint venture in respect of indebtedness of
such partnership or such joint venture which is treated as a general partnership
for purposes of Applicable Law. The amount of any Guaranty shall be deemed to be
an amount equal to the stated or determinable amount (or portion thereof) of the
primary obligation in respect of which such Guaranty is made or, if not stated
or determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder); provided that the
amount of any Guaranty shall be limited to the extent necessary so that such
amount does not exceed the value of the assets of such Person (as reflected on a
consolidated balance sheet of such Person prepared in accordance with GAAP) to
which any creditor or beneficiary of such Guaranty would have recourse.
Notwithstanding the foregoing definition, the term “Guaranty” shall not include
any direct or indirect obligation of a Person as a general partner of a general
partnership or a joint venturer of a joint venture in respect of Indebtedness of
such general partnership or joint venture, to the extent such Indebtedness is
contractually non recourse to the assets of such Person as a general partner or
joint venturer (other than assets comprising the capital of such general
partnership or joint venture).
          “HUD”: The United States Department of Housing and Urban Development
or any successor thereto.
          “Indebtedness”: With respect to any Person, (i) all indebtedness,
obligations and other liabilities of such Person and its Subsidiaries which are,
at the date as of which Indebtedness is to be determined, includable as
liabilities in a consolidated balance sheet of such Person and its Subsidiaries,
other than (w) accounts payable, accrued expenses and derivatives transactions
entered into in the ordinary course of business pursuant to hedging programs,
(x) advances from clients obtained in the ordinary course of the relocation
management services business of such Person and its Subsidiaries, (y) current
and deferred income taxes and other similar liabilities and (z) minority
interest, plus (ii) without duplicating any items included in Indebtedness
pursuant to the foregoing clause (i) (but excluding reinsurance obligations of
Atrium Insurance Corporation and its successors and assigns), the maximum
aggregate amount of all liabilities of such Person or any of its Subsidiaries
under any Guaranty, indemnity or similar undertaking given or assumed of, or in
respect of, the indebtedness, obligations or other liabilities, assets,
revenues, income or dividends of any Person other than such Person whose
Indebtedness is being determined or one of its Subsidiaries and (iii) all other
obligations or liabilities of such Person or any of its Subsidiaries in relation
to the discharge of the obligations of any Person other than such Person whose
Indebtedness is being determined or one of its Subsidiaries.
          “Individual Takeout Amount”: The principal amount of an Agency
Security covered by a particular Takeout Commitment plus accrued interest on
such amount, determined in accordance with Good Delivery requirements.
          “Initial Balance”: The aggregate outstanding principal balance of the
Mortgage Loans evidenced by a Participation Certificate as of the related
Purchase Date.

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          “Initial Remittance Date”: The meaning ascribed thereto in Section
4(c) of this Agreement.
          “Interest Rate Protection Agreement”: Any interest rate swap
agreement, interest rate cap agreement or other similar financial agreement or
arrangement.
          “LIBOR Rate” shall mean, with respect to any Purchase Date, the rate
of interest (calculated on a per annum basis) equal to the one month British
Bankers Association Rate as reported on the display designated as “BBAM” “Page
DG8 4a” on Bloomberg (or such other display as may replace “BBAM” “Page DG8 4a”
on Bloomberg) on such Purchase Date, and if such rate shall not be so quoted,
the rate per annum at which Purchaser is offered Dollar deposits at or about
11:00 a.m., (New York City time), on such Purchase Date, by prime banks in the
interbank eurodollar market where the eurodollar and foreign currency exchange
operations in respect of its loans are then being conducted for delivery on such
day for a one month period, and in an amount comparable to the amount of the
Purchase Price of Transactions to be entered into on such day.
          “Losses”: The meaning ascribed thereto in Section 5(a) of this
Agreement.
          “Material Adverse Effect”: The occurrence of (i) a material and
adverse change with respect to the business, operations, properties or financial
condition of Seller or PHH Parent or a material and adverse change with respect
to the prospects of Seller and PHH Parent taken as a whole, (ii) a material
adverse effect on the ability of Seller or PHH Parent to perform its Obligations
under any of the Program Documents to which it is a party, (iii) a material
adverse effect on the validity or enforceability against Seller or PHH Parent of
any of the Program Documents to which it is a party, (iv) a material adverse
effect on the rights and remedies of Purchaser under any of the Program
Documents, or (v) a material adverse effect, other than due to market
conditions, on the value of a material portion of the Mortgage Loans in each
case of clauses (i) — (v) as determined by the Purchaser in its sole good faith
discretion.
          “Material Subsidiary”: For any Person, any Subsidiary of such Person,
which together with its own Subsidiaries at the time of determination had assets
constituting 10% or more of such Person’s Consolidated Assets, accounts for 10%
or more of such Person’s Consolidated Net Worth, or accounts for 10% or more of
the revenue of such Person and its Consolidated Subsidiaries for the Rolling
Period immediately preceding the date of determination.
          “Maximum Purchase Price”: FIVE HUNDRED MILLION DOLLARS ($500,000,000).
          “MERS”: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, or any successor thereto.
          “MERS System”: The electronic registry system, through which MERS is
designated as mortgagee of record for the Mortgage Loans, takes all such actions
as may be required with regard to servicing the Mortgage Loans, including, but
not limited to, executing and, if required in accordance with Accepted Servicing
Practices, recording, any modification,

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waiver, subordination agreement, instrument of satisfaction or cancellation,
partial or full release, discharge or any other comparable instruments.
          “Mortgage”: A first lien mortgage or deed of trust securing a Mortgage
Note.
          “Mortgage File”: The items pertaining to each Mortgage Loan (other
than the Mortgage Loan Documents required to be delivered to the Custodian
pursuant to the Custodial Agreement) and Agency Program as described in the
relevant Agency Guide.
          “Mortgage Insurance Certificate”: An original HUD Form 59100 signed by
HUD which identified the Mortgage Loan it accompanies.
          “Mortgage Interest Rate”: The annual rate of interest borne by the
Mortgage Note.
          “Mortgage Loan”: Each mortgage loan included in a Mortgage Pool, in
each case secured by a Mortgage on a one- to four-family residence and (if so
required by the relevant Agency Program) eligible to be either guaranteed by VA
and/or insured by FHA, or insured by a private mortgage insurer, as applicable.
          “Mortgage Loan Documents”: The originals of the Mortgage Notes and
other documents and instruments, in each case with respect to the Mortgage
Loans, required to be delivered to the Custodian in connection with each
Transaction, all pursuant to the Custodial Agreement.
          “Mortgage Loan Remittance Report”: The meaning ascribed thereto in
Section 5(a) of this Agreement.
          “Mortgage Loan Schedule”: The meaning ascribed thereto in the
Custodial Agreement.
          “Mortgage Note”: A promissory note or other evidence of indebtedness
of the obligor thereunder, representing a Mortgage Loan, and secured by the
related Mortgage.
          “Mortgage Pool”: Shall have the meaning ascribed thereto in the
introductory recitals to this Agreement.
          “Mortgage Pool Ownership Interest”: Shall have the meaning ascribed
thereto in Section 2(b)(i) of this Agreement.
          “Mortgage Warehouse Facilities”: (i) The Existing Mortgage Warehouse
Facilities and (ii) each other credit facility for the warehousing or gestation
of mortgages that provides financing to PHH Parent or any of its Subsidiaries.
          “Mortgaged Property”: The real property securing repayment of the debt
evidenced by a Mortgage Note.

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          “Mortgagor”: The obligor or obligors on a Mortgage Note, including any
person who has assumed or guaranteed the obligations of the obligor thereunder
          “Multiemployer Plan”: A multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been or are required to be
made by Seller or any ERISA Affiliate and that is covered by Title IV of ERISA.
          “Net Mortgage Interest Rate”: With respect to any Mortgage Loan, the
Mortgage Interest Rate applicable to such Mortgage Loan less the Servicing Fee.
          “Obligations”: All of the obligations of the Seller to the Purchaser
under the Program Documents.
          “Outstanding Transaction”: The meaning ascribed thereto in Section 11
of this Agreement.
          “Participation Certificate”: A certificate issued in the name of
Purchaser and delivered to Custodian by Seller in connection with each
Transaction, substantially in the form attached as an exhibit to the Custodial
Agreement, such certificate to evidence the entire (100%) beneficial ownership
interest in the related Mortgage Pool.
          “Participation Certificate Pass-Through Rate”: With respect to each
Participation Certificate, the per annum rate at which interest is passed
through to Purchaser which initially shall be the rate of interest specified on
such Participation Certificate as the Pass-Through Rate, subject to adjustment
as contemplated hereby. The Participation Certificate Pass-Through Rate is based
upon the weighted average of the Net Mortgage Interest Rates on the Mortgage
Loans.
          “PBGC”: The Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
          “Permitted Affiliate Agreement”: An agreement listed on Exhibit G
hereto, as such agreement may be amended, restated, supplemented or otherwise
modified from time to time.
          “Permitted Affiliate Transactions”: (a) Purchases and sales by Seller
of mortgage loans to or from any of its Subsidiaries or Affiliates or the
brokering of mortgage loans between Seller and any Subsidiary or Affiliate
thereof, (b) proceeds received by Seller in connection with fees required to be
paid under the PHH Management Services Agreement as existing on the date hereof,
together with any increase in such existing fees but excluding any separate or
additional fees not required under the PHH Management Services Agreement,
(c) proceeds received by Seller in connection with servicing fees required to be
paid by its Subsidiaries, (d) loans or advances by Seller to or from PHH Parent
or any Subsidiary thereof (and the repayment thereof), (e) distributions and
other transfers by Seller of its properties or assets to PHH Parent or any
Subsidiary thereof and (g) any transaction contemplated by, and fees payable
pursuant to, the Permitted Affiliate Agreements not otherwise referenced in this
definition.

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          “Person”: An individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.
          “PHH Home Loans Entities”: PHH Home Loans, LLC, a Delaware limited
liability company, and its Subsidiaries.
          “PHH Management Services Agreement”: That certain Management Services
Agreement, dated as of March 31, 2006, by and among PHH Home Loans, LLC, Seller
and the other parties listed therein, as amended, restated, supplemented or
otherwise modified from time to time.
          “PHH Parent”: PHH Corporation, a Maryland corporation.
          “Plan”: An employee benefit or other plan established or maintained by
Seller or any ERISA Affiliate and covered by Title IV of ERISA, other than a
Multiemployer Plan.
          “Pooling Documents”: Each of the original schedules, forms and other
documents (other than the Mortgage Loan Documents) required to be delivered by
or on behalf of Seller with respect to a Mortgage Pool to the relevant Agency
and/or the Purchaser and/or the Custodian, as further described in the Custodial
Agreement.
          “Potential Servicing Termination Event” A Servicing Termination Event
or an event that with notice or lapse of time or both would become a Servicing
Termination Event.
          “Present Value Adjustment”: The product of (a) the Discount Rate,
(b) the Initial Balance, (c) the Takeout Price and (d) a fraction, the numerator
of which is the actual number of days elapsed from (and including) the Purchase
Date to (but excluding) the Cut-off Date and the denominator of which is 360.
          “Pro Forma Basis”: In connection with any transaction for which a
determination on a Pro Forma Basis is required to be made hereunder, that such
determination shall be made (i) after giving effect to any issuance of
Indebtedness, any acquisition, any disposition or any other transaction (as
applicable) and (ii) assuming that the issuance of Indebtedness, acquisition,
disposition or other transaction and, if applicable, the application of any
proceeds therefrom, occurred at the beginning of the most recent Rolling Period
ending at least thirty (30) days prior to the date on which such issuance of
Indebtedness, acquisition, disposition or other transaction occurred.
          “Program Documents”: This Agreement, the Custodial Agreement, the
Electronic Tracking Agreement, each Participation Certificate and all other
documents related thereto.
          “Program Fee”: As set forth in the Fee Letter.
          “Purchase Date”: As to a given Transaction, the date of Seller’s sale
and Purchaser’s purchase of the Participation Certificate, as evidenced by
Purchaser’s payment to Seller of the Purchase Price.

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          “Purchase Price”: With respect to any Participation Certificate, an
amount equal to the sum of:
          A. the product of the Initial Balance and the Takeout Price;
          B. the product of (i) the product of (1) the Participation Certificate
Pass-Through Rate and (2) the Initial Balance; and (ii) a fraction, the
numerator of which is the actual number of days elapsed from (and including) the
Cut-off Date to (but excluding) the Settlement Date and the denominator of which
is 360; and
          C. minus the Present Value Adjustment.
          “Qualified Depository”: A depository institution, the accounts of
which are insured by the FDIC, which meets the applicable requirements of the
relevant Agency for maintaining custodial collection accounts and escrow
accounts in connection with servicing mortgage loans underlying an Agency
Security.
          “Remittance Date”: The 25th day of each month (or if such day is not a
Business Day, the Business Day immediately following such 25th day).
          “REO Assets”: With respect to any Person, means a real estate asset
owned by such Person and acquired as a result of the foreclosure or other
enforcement of a lien on such asset securing a Servicing Advance or loans and
other mortgage-related receivables purchased or originated by PHH Parent or any
of its Subsidiaries in the ordinary course of business.
          “Reportable Event”: Any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty day notice period is
waived.
          “Remittance Date”: The 25th day of each month (or if such day is not a
Business Day, the Business Day immediately following such 25th day).
          “Replacement Shortfall”: The meaning ascribed thereto in Section 9(c)
of this Agreement
          “Requirement of Law”: As to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, rule, regulation, procedure or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
          “Responsible Officer”: As to any Person, the chief executive officer,
the chief financial officer, the treasurer or the chief operating officer of
such Person.
          “Revolver Fourth Amendment Effective Date”: June 25, 2010.
          “Revolving Credit Facility”: That certain Amended and Restated
Competitive Advance and Revolving Credit Agreement, dated as of January 6, 2006
as amended through the Fourth Amendment, dated as of June 25, 2010, among PHH
Parent, as Borrower, PHH Vehicle

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Management Services Inc., as Canadian Subsidiary Borrower, JPMorgan Chase Bank,
N.A., as Administrative Agent, the lenders from time to time party thereto and
others, as further amended from time to time. To the extent the Revolving Credit
Facility is terminated, the terms incorporated herein by reference shall survive
such termination.
          “Rolling Period”: With respect to any fiscal quarter, such fiscal
quarter and the three immediately preceding fiscal quarters considered as a
single accounting period.
          “SEC”: The Securities and Exchange Commission.
          “Securitization Indebtedness”: Indebtedness incurred by any structured
bankruptcy-remote Subsidiary of PHH Parent which does not permit or provide for
recourse to PHH Parent or any Subsidiary of PHH Parent (other than such
structured bankruptcy-remote Subsidiary) or any property or asset of PHH Parent
or any Subsidiary of PHH Parent (other than the property or assets of such
structured bankruptcy-remote Subsidiary). Securitization Indebtedness shall
include, without limitation, the Fleet Asset Securitization Facilities and other
similar financing facilities.
          “Scheduled Delivery Date”: The date of delivery of any Agency Security
to be delivered by an Agency to Purchaser in connection with a Transaction.
          “Serviced Loans”: All residential mortgage loans serviced or required
to be serviced by the Seller under any Servicing Agreement, irrespective of
whether the actual servicing is done by another Person retained by the Seller
for that purpose.
          “Servicing Advances”: Advances made by PHH Parent or any of its
Subsidiaries in its capacity as servicer of any mortgage-related receivables to
fund principal, interest, escrow, foreclosure, insurance, tax or other payments
or advances when the borrower on the underlying receivable is delinquent in
making payments on such receivable; to enforce remedies, manage and liquidate
REO Assets; or that PHH Parent or any of its Subsidiaries otherwise advances in
its capacity as servicer pursuant to any servicing agreement.
          “Servicing Advance Facility”: Any funding arrangement with lenders
based in whole or in part upon Servicing Advances under which advances are made
to PHH Parent or any of its Subsidiaries.
          “Servicing Agreement”: With respect to any Person, the arrangement
(whether or not in writing) pursuant to which that Person acts as servicer of
residential mortgage loans, whether owned by that Person or by others.
          “Servicing Fee”: With respect to any Mortgage Loan and any month, the
monthly fee payable to the Servicer for the servicing of such Mortgage Loan,
such fee being calculated on a Mortgage Loan-by-Mortgage Loan basis and equal to
the outstanding principal balance of such Mortgage Loan on which interest
accrued in the related month multiplied by a percentage which is set forth on
the Mortgage Loan Schedule.
          “Servicing File”: With respect to each Mortgage Loan, the file to be
held by Seller in trust for the benefit of Purchaser, solely in Seller’s
capacity as a servicer. Such file

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includes, but is not limited to, originals or copies of all documents in the
Mortgage File, computer files, data disks, books, records, payment histories,
data tapes, notes and all additional documents generated as a result of or
utilized in originating and servicing each Mortgage Loan.
          “Servicing Period”: The meaning ascribed thereto in Section 2(b)(iv)
of this Agreement.
          “Servicing Portfolio”: The Seller’s entire portfolio of Serviced
Loans.
          “Servicing Termination Events”: Shall have the meaning ascribed
thereto in Section 5(e) of this Agreement.
          “Servicing Transfer Date”: Shall have the meaning ascribed thereto in
Section 6 of this Agreement.
          “Settlement Date”: With respect to each Transaction, that date
specified as the contractual delivery and settlement date in the related Takeout
Commitment(s) pursuant to which Purchaser has the right and obligation to
deliver Agency Securities to the Takeout Buyer(s).
          “SIFMA Guide”: The uniform practices for the clearance and settlement
of mortgage backed securities and other related securities, published (and
periodically updated as supplemented) by The Securities Industry and Financial
Markets Association (“SIFMA”).
          “Single-Employer Plan”: A single-employer plan as defined in
Section 4001(a)(15) of ERISA which is subject to the provisions of Title IV of
ERISA.
          “Special Purpose Vehicle Subsidiary”: PHH Caribbean Leasing, Inc. and
any Subsidiary engaged in the fleet-leasing management business that (i) is, at
any time, a party to one or more lease agreements with only one lessee, and
(ii) finances, at any one time, its investments in lease agreements or vehicles
with only one lender (which lender may be PHH Parent if and to the extent that
such loans and/or advances by PHH Parent are not prohibited hereby).
          “Standard Agency Mortgage Loan Representations”: Shall have the
meaning ascribed thereto in Section 9(b)(iii) of this Agreement.
          “Subsidiary”: With respect to any Person, any corporation,
association, joint venture, partnership or other business entity (whether now
existing or hereafter organized) of which at least a majority of the voting
stock or other ownership interests having ordinary voting power for the election
of directors (or the equivalent) is, at the time as of which any determination
is being made, 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.
          “Takeout Amount”: The aggregate of the Individual Takeout Amounts
respecting the Agency Security to be issued in connection with a given
Transaction, which Takeout Amount shall be required to equal the unpaid
principal balance of the Agency Security plus accrued interest.

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          “Takeout Buyer”: (i) Any member of the Mortgage-Backed Securities
Clearing Corporation or (ii) any other Person approved by Purchaser.
          “Takeout Commitment”: A trade confirmation from the Takeout Buyer to
Seller in oral or electronic format confirming the details of a forward trade
between the Takeout Buyer (as buyer) and Seller (as seller) constituting a
valid, binding and enforceable commitment by a Takeout Buyer to purchase on the
Settlement Date and at a given Takeout Price the principal amount of the Agency
Security described therein.
          “Takeout Commitment Assignment”: An assignment executed by Seller,
whereby Seller irrevocably assigns its rights and obligations under the Takeout
Commitment (provided; that Purchaser’s obligation under such Takeout Commitment
shall arise solely to the extent it receives the related Agency Security), and
which assignment shall be substantially in the form and content of Exhibit A
hereto.
          “Takeout Price”: As to each Takeout Commitment the purchase price
(expressed as a percentage of par) set forth therein.
          “Tangible Net Worth”: With respect to any Person, as of any date of
determination, such Person’s Consolidated Net Worth minus the aggregate book
value of all intangible assets of such Person and its Consolidated Subsidiaries
as of such date in accordance with GAAP.
          “Transaction”: Each of (i) each commitment by Purchaser to purchase,
and by Seller to sell, a Mortgage Pool as evidenced by a Participation
Certificate under the terms and conditions of this Agreement; (ii) Seller’s
performance of its Obligations both hereunder respecting such Mortgage Pool and
under the Custodial Agreement; (iii) the issuance and delivery of the related
Agency Security together with Seller’s undertakings respecting the facilitation
of such Agency Security issuance; (iv) the delivery of the related Agency
Security to the Takeout Buyer under each Takeout Commitment; (v) Purchaser’s
exercise of its rights and remedies hereunder and in the Custodial Agreement in
the event of an Agency Security Issuance Failure; and (vi) as appropriate,
Seller’s servicing of the Mortgage Pool as described herein.
          “VA”: The Department of Veterans Affairs.
          “VA Approved Lender”: Those lenders that are approved by the VA to act
as a lender in connection with the origination of any VA Loan subject to a VA
Loan Guaranty Agreement.
          “VA Loan”: A Mortgage Loan that is or will be the subject of a VA Loan
Guaranty Agreement.
          “VA Loan Guaranty Agreement”: The obligation of the United States to
pay a specific percentage of a Mortgage Loan (subject to a maximum amount)
pursuant to the Serviceman’s Readjustment Act, as amended.

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          “Warehouse Lender”: Any lender providing financing to Seller for the
purpose of originating Mortgage Loans, which prior to the Purchase Date has a
security interest in such Mortgage Loans as collateral for the obligations of
Seller to such lender.
          “Warehouse Lender’s Release”: A letter from a Warehouse Lender in the
form of an exhibit to the Custodial Agreement or such other form acceptable to
Purchaser in its sole discretion.
          “Wire Instructions”: The wiring instructions as provided by the Seller
to the Purchaser and attached hereto as Exhibit C.
          Section 2. Purchases of Participation Certificates.
          (a) Purchaser shall from time to time, purchase one or more
Participation Certificates from Seller at the Purchase Price that are delivered
to Purchaser at Seller’s request in accordance with the terms hereof and the
Custodial Agreement. Purchaser shall be under no obligation to purchase of any
Participation Certificate until the Conditions Precedent set forth in Section 8
shall be satisfied or waived.
          (b) Simultaneously with the payment by Purchaser of the Purchase
Price, in accordance with the warehouse lender’s wire instructions or Seller’s
Wire Instructions, as applicable, with respect to a Participation Certificate,
Seller hereby agrees to:
     (i) irrevocably and absolutely sell, transfer, assign, set over and convey
to Purchaser, without recourse but subject to the terms of this Agreement, all
right, title and interest of Seller in and to (A) the Participation Certificate
and a 100% undivided beneficial ownership interest in the Mortgage Loans subject
to such Participation Certificate, (B) any payments or proceeds under any
related primary insurance, hazard insurance and FHA insurance policies and VA
guarantees (if any) and (C) the Mortgage Loan Documents and Mortgage Files
(collectively, the “Mortgage Pool Ownership Interest”);
     (ii) irrevocably and absolutely assign and set over to Purchaser all of
Seller’s rights and its obligations in and to each Takeout Commitment (provided;
that Purchaser’s obligation under such Takeout Commitment shall arise solely to
the extent it receives the related Agency Security) and does hereby deliver to
Purchaser the Takeout Commitment Assignment duly executed by Seller;
     (iii) sell, transfer, set over and convey to Purchaser all of Seller’s
right, title and interest in and to the Agency Security scheduled to be issued
by the applicable Agency; and
     (iv) service each Mortgage Loan subject to the applicable Participation
Certificate as servicer for the benefit of Purchaser (and any other registered
holder of the Participation Certificate) for a term of sixty (60) days following
the related Purchase Date (the “Servicing Period”), which is renewable for
subsequent sixty (60) day periods (or such other period agreed to by Purchaser)
upon written agreement by Purchaser through the earliest to occur of (A) the
date of actual issuance, delivery and settlement of the

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Agency Security to Purchaser, provided such issuance and delivery occurs on or
before the Agency Security Issuance Deadline, unless otherwise mutually agreed
to by the parties and (B) in the case of an Agency Security Issuance Failure,
either (x) any date so designated by Purchaser, but in all events a date
occurring no later than the last calendar day of the second month following the
month in which the Settlement Date for the related Agency Security was
originally scheduled to occur; or (y) at Seller’s option the date of Seller’s
purchase of the entire Mortgage Pool related to such Agency Security Issuance
Failure.
          (c) Purchaser shall (i) upon receipt of the executed Takeout
Commitment Assignment, promptly deliver such Takeout Commitment Assignment to
the applicable Takeout Buyer and (ii) promptly after consummation of the
transactions contemplated in the applicable Takeout Commitment Assignment,
deliver to Seller a written report (in form and substance acceptable to
Purchaser) reflecting that the related transactions have settled.
          (d) From time to time Seller may make a request of Purchaser by
telephone or otherwise to enter into a Transaction.
          (e) In connection with the purchase of any Participation Certificate
hereunder, Purchaser shall, upon receipt of a duly executed and properly
completed copy of the Participation Certificate, (x) if such Participation
Certificate is received by Purchaser prior to 2:00 p.m. (Eastern time) then
prior to 4:00 p.m. (Eastern time) on such date or (y) if such Participation
Certificate is received by Purchaser at or after 2:00 p.m. (Eastern time) then
prior to 4:00 p.m. (Eastern time) on the next Business Day, pay an amount equal
to the Purchase Price for such Participation Certificate by wire transfer of
immediately available funds (i) if there is no Warehouse Lender, to Seller in
accordance with Seller’s Wire Instructions or (ii) upon the receipt of a
Warehouse Lender’s Release, to a Warehouse Lender, provided that, if the
Purchase Price is insufficient to pay the release amount due to the Warehouse
Lender, Seller shall remit to Purchaser the difference between the Purchase
Price and such release amount and Purchaser shall remit the full release amount
to the Warehouse Lender. In the event that Purchaser does not transmit such
payment, (i) any Participation Certificate delivered by Custodian to Purchaser
in anticipation of such purchase shall automatically be null and void,
(ii) Purchaser will not consummate the transactions contemplated in the
applicable Takeout Commitment Assignment, (iii) if Purchaser shall nevertheless
receive any portion of the related Takeout Price, Purchaser shall pay such
Takeout Price to Seller in accordance with Seller’s Wire Instructions on the
date of receipt thereof by Purchaser if Purchaser receives such portion of the
Takeout Price prior to 1:00 p.m., New York City time and otherwise, on the next
Business Day and (iv) to the extent that Purchaser shall nevertheless receive
the Agency Security backed by the Mortgage Loans prior to the Participation
Certificate becoming null and void as provided in clause (i) above, Purchaser
shall take all reasonable actions necessary to ensure that such Agency Security
shall be delivered in accordance with Seller’s delivery instructions provided to
Purchase at such time.
          (f) In the event that the Agency Security is not issued on or before
the Agency Security Issuance Deadline, Purchaser and Seller may, in the sole
discretion of each such party, agree to extend the original Agency Security
Issuance Deadline, which agreement shall be evidenced in writing.

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          (g) To the extent, but only to the extent, the Agency Security is not
issued on or before the Agency Security Issuance Deadline or an Agency Security
Issuance Failure has occurred, then all payments and recoveries of principal and
interest respecting any Mortgage Loan due on or after the Cut-off Date, shall
belong to Purchaser.
          (h) The terms and conditions of the purchase of each Participation
Certificate shall be as set forth in this Agreement and in each Participation
Certificate. Each Participation Certificate shall be deemed to incorporate, and
Seller shall be deemed to make as of the applicable dates specified herein, for
the benefit of Purchaser, the representations and warranties set forth herein in
respect of such Participation Certificate and the Mortgage Loans evidenced by
such Participation Certificate.
          Section 3. Takeout Commitments.
          Seller, coincident with the commencement of each Transaction, hereby
and thereby assigns and sets over to Purchaser, without recourse, free and clear
of any lien, claim, participation or encumbrance of any kind, all of Seller’s
rights (but not its obligations) under each Takeout Commitment, including
without limitation its right and entitlement to receive the entire Takeout Price
specified in each Takeout Commitment from a Takeout Buyer. Purchaser agrees that
it will deliver to each Takeout Buyer such Agency Security that is sufficient to
satisfy all Takeout Commitments, provided that the Agency Security shall have
been issued and delivered to Purchaser in the Agency Security Face Amount, and
at least equal to the Cut-off Date Principal Balance, on or before the
Settlement Date so as to allow Purchaser to effect Good Delivery of the Agency
Security to the Takeout Buyer.
          Section 4. Issuance and Delivery of Participation Certificate.
          (a) In connection with each Transaction, Seller shall cause a
completed Participation Certificate executed by Seller to be issued and
delivered to the Custodian for authentication and delivery of a copy thereof to
Purchaser on or before the Purchase Date. Pursuant to the Custodial Agreement,
Custodian shall hold the Participation Certificate for the exclusive use and
benefit of Purchaser, as Purchaser’s bailee, and shall deliver a facsimile copy
of the Participation Certificate to Purchaser upon authentication. The
Participation Certificate shall evidence the entire Mortgage Pool Ownership
Interest in the Mortgage Pool. The Participation Certificate shall, by its
terms, cease to evidence a Mortgage Pool Ownership Interest (i) (A) with respect
to any Agency Security issued by GNMA, when Purchaser is registered as the
registered owner of such Security on GNMA’s central registry and (B) with
respect to any Agency Security issued by Fannie Mae or FHLMC, the later to occur
of (x) the issuance of the related Agency Security and (y) the transfer of all
of the right, title and ownership interest in that Agency Security to Purchaser
or its designee; or (ii) in the event of an Agency Security Issuance Failure and
Purchaser exercises its option to terminate Seller as servicer in accordance
with the terms hereof and cause the Participation Certificate to be canceled in
exchange for assignment and delivery to Purchaser by the Custodian of the entire
Mortgage Pool Ownership Interest, and provided further, that the rights and
remedies conferred under such Participation Certificate and this Agreement shall
continue to be effective in determining the rights of Purchaser (or other holder
of the Participation Certificate) to receive the benefit of any required
payments derived from the Mortgage Pool.

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          (b) Purchaser and any transferee under the Participation Certificate
shall be entitled during the term in which a Participation Certificate remains
in force and effect to sell, transfer, assign, pledge, or otherwise dispose of
such Participation Certificate in accordance with the terms of the Custodial
Agreement, all without the consent of Seller; provided that Purchaser shall not
enter into any agreement with respect to the sale, transfer, assignment, pledge,
or other disposition of a Participation Certificate that shall expressly
restrict Purchaser’s obligation or ability to deliver the Participation
Certificate and related Mortgage Loans as contemplated hereunder. Seller agrees
to treat any registered holder of the Participation Certificate as the sole
beneficial owner of the Mortgage Pool evidenced thereby, all as further provided
in the Custodial Agreement. Upon any transfer by the Purchaser of a
Participation Certificate, the Purchaser shall provide notice of such transfer
to the Seller and provide the Seller with contact information for such
transferee; provided that the failure to give such notice and contact
information shall not affect the validity of any such transfer and provided,
further, in no event shall Seller be required to recognize any such transfer
that Seller has not received notice of.
          (c) Upon sale or other disposition by Purchaser as contemplated
herein, Purchaser (or a subsequent registered holder of a Participation
Certificate) shall surrender the Participation Certificate (to the extent in its
possession) to Custodian upon the earliest to occur of (i) the sale or transfer
of such Participation Certificate and (ii) the assignment and delivery to
Purchaser of the entire Mortgage Pool Ownership Interest.
          Section 5. Mortgage Pool Servicing.
          (a) General Servicing Standards; Indemnification; Servicing
Compensation. Purchaser and Seller agree that Seller shall service each Mortgage
Pool for the benefit of Purchaser (and any other registered holder of the
Participation Certificate) from the Purchase Date for each Transaction until the
expiration or earlier termination of the Servicing Period. Seller shall have no
further servicing obligations or duties to Purchaser under the terms of this
Agreement with respect to the relevant Mortgage Pool upon the expiration of the
applicable Servicing Period.
          Seller shall service and administer each Mortgage Pool in accordance
with Accepted Servicing Practices and Seller shall at all times comply with
Applicable Law, FHA Regulations and VA regulations, as applicable, and any other
applicable rules or regulations so that (among other things) FHA insurance, VA
guarantee, or private mortgage insurance in respect of any Mortgage Loan remains
in full force and effect and is not reduced. Seller shall at all times maintain
accurate and complete records of its servicing of the Mortgage Loans, and
Purchaser may, at any time during Seller’s normal business hours, on reasonable
notice, examine such records. In addition, Seller shall deliver to Purchaser on
each Remittance Date (or other date of required remittance of Mortgage Loan
payments) occurring during the Servicing Period a written report regarding the
status of those Mortgage Loans, in the form, and having the content, of the
remittance report required under the relevant Agency Guide and Agency Program
respecting the Agency Security originally intended to be issued pursuant to the
Transaction (each, a “Mortgage Loan Remittance Report”). Seller shall not
consent to a modification of the interest rate of a Mortgage Note, defer or
forgive the payment thereof or of any principal, reduce the outstanding
principal amount (except for actual payments of principal) or extend the final

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maturity date of a Mortgage Loan during the Servicing Period or at any other
time that it is servicing such Mortgage Loan hereunder for the benefit of
Purchaser or its permitted assigns.
          Seller shall indemnify and hold Purchaser harmless against any and all
actions, claims, liabilities or other losses (“Losses”) resulting from or
otherwise arising in connection with the failure of Seller to perform its
Obligations (including, without limitation, any indemnity in connection with a
breach of a representation and warranty in Section 9(b) hereof) in strict
compliance with the terms of this Agreement (which indemnification shall not
include consequential damages but shall include, without limitation, any failure
to perform servicing obligations, any failure of a Takeout Buyer to perform in a
timely manner under its forward purchase commitment if such failure was caused
by Seller’s required action or failure to take action under the terms of this
Agreement, any Losses attributable to an Agency Security Issuance Failure if
such failure was caused by Seller’s required action or failure to take action
under the terms of this Agreement, any Losses attributable to the improper
servicing of the Mortgage Loans and any Losses attributable to the failure of an
Agency to deliver an Agency Security on the Scheduled Delivery Date if such
failure was caused by Seller’s required action or failure to take action under
the terms of this Agreement).
          With respect to any Mortgage Loan, if the related Mortgagor is
delinquent with respect to either the Mortgage Loan’s first or second scheduled
monthly payment subsequent to origination of such Mortgage Loan, Seller shall,
upon receipt of notice from Purchaser, repurchase the beneficial interest in
such Mortgage Loan within one hundred and twenty (120) days after the Purchase
Date, provided that Seller shall have no obligation to repurchase such Mortgage
Loan or indemnify Purchaser from any Losses resulting from or otherwise arising
in connection with such delinquent Mortgage Loan after an Agency Security backed
by such Mortgage Loan is issued.
          As compensation for Seller undertaking servicing duties, Seller shall
be entitled to receive the Servicing Fee and such other compensation (e.g., late
fees and assumption fees) as and in such manner provided for under the
applicable provisions of the relevant Agency Guide and Agency Program.
          (b) Seller’s Retention of Mortgage Files and Servicing Files. Each
Servicing File and Mortgage File shall be held by Seller in order to service the
Mortgage Loans pursuant to this Agreement and are and shall be held in trust by
Seller for the benefit of Purchaser as the owner thereof during the Servicing
Period or at any other time that it is servicing such Mortgage Loan hereunder
for the benefit of Purchaser or its permitted assigns. Seller shall at all times
maintain accurate and complete records of its servicing of the Mortgage Loans,
and Purchaser may, at any time during Seller’s business hours on reasonable
notice, examine and make copies of such Servicing Files. Seller covenants to
hold all Servicing Files with respect to the Mortgage Loans for the benefit of
Purchaser in Seller’s capacity as servicer and to safeguard such Servicing Files
and to deliver copies of them promptly to Purchaser or its designee (including
the Custodian) at Purchaser’s request or otherwise as required by operation of
this Section 5(b). The ownership of each Mortgage Note, Mortgage and related
Mortgage Loan Documents, and the contents of each Mortgage File is vested in
Purchaser and the ownership of all records and documents with respect to the
related Mortgage Loan prepared by or which come into the possession of Seller
shall immediately vest in Purchaser and shall be retained and maintained, in
trust, by Seller at the

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will of Purchaser in such custodial capacity only. The books and records of
Seller shall be appropriately marked to clearly reflect the ownership of the
related Mortgage Loans by Purchaser (subject to the rights of the relevant
Agency upon issuance of the Agency Security). Seller shall release from its
custody the contents of any Mortgage File or Servicing File retained by it only
in accordance with this Agreement and/or any applicable Agency Guide, unless
such release is required as incidental to the servicing of a Mortgage Loan.
          (c) Custodial Collection Account; Mortgage Loan Payments. Seller shall
establish one or more custodial collection accounts, each in the form of time
deposit or demand accounts, and each titled, “PHH Mortgage Corporation, in trust
for JPMorgan Chase Bank, National Association Residential Rate Mortgage Loans
and various Mortgagors” (each such account, a “Custodial Account”). Such
accounts shall be established with a Qualified Depository acceptable to
Purchaser and Seller shall promptly deliver to Purchaser evidence of the
establishment of such accounts.
          Each Participation Certificate shall provide for monthly remittance by
Seller to the registered holder thereof of Mortgage Pool payments of principal
(including principal prepayments) and interest. The first Remittance Date for
Seller’s remittance of Mortgage Loan payments to the holder of a Participation
Certificate (“Initial Remittance Date”) shall occur (if at all) on the 25th day
of the month following the month in which the Settlement Date is scheduled to
occur. The remittance on the Initial Remittance Date, or on such earlier date if
an Agency Security Issuance Failure has occurred, shall include all Mortgage
Pool payments of principal (including principal prepayments) and interest (with
the interest component thereof adjusted to the Participation Certificate
Pass-Through Rate) received by Seller.
          Amounts deposited in the Custodial Account with respect to any
Mortgage Loan shall be held for the benefit of Purchaser and shall be released
only as follows:
          (i) to the Seller, upon the repurchase by Seller of the beneficial
interest in any Mortgage Loan pursuant to Sections 5(a) or 9(c) hereof, with
respect to all amounts deposited in the Custodial Account in connection with
such repurchased Mortgage Loan;
          (ii) except as otherwise provided in clause (iii) below, to the Seller
upon the earlier to occur of either (x) the Settlement Date (unless there is an
Agency Securities Issuance Failure) or (y) the date required by the applicable
Agency Guide, provided that if any amounts are due and owing by the Seller to
the Purchaser hereunder on such Settlement Date, the Purchaser shall withdraw
and retain such amounts from the Custodial Account on such Settlement Date,
prior to such amounts from the Custodial Account being released to Seller on
such Settlement Date;
          (iii) to Purchaser promptly upon delivery of such Mortgage Loans to a
successor Servicer either as set forth herein or otherwise; and
          (iv) if an Agency Security is not issued solely as a result of an
Agency Security Issuance Failure during the month in which the related
Settlement Date occurs, in any period thereafter during which Seller remains as
servicer, in accordance with Purchaser’s written instructions.

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          Any funds deposited in any of the foregoing accounts shall at all
times be fully insured by the FDIC to the full extent permitted under Applicable
Law. Funds shall be deposited in such accounts, and may be drawn on and invested
and reinvested, by Seller solely in a manner consistent with the applicable
servicing provisions of the Agency Guide and Agency Program relating to the
Agency Security originally intended to be issued in connection with the relevant
Transaction.
          (d) Subservicers. No Mortgage Loans may be subserviced without the
prior written consent of the Purchaser.
          (e) Early Servicing Termination. Without limiting Purchaser’s rights
to terminate Seller as servicer as provided above, Purchaser (or any other
registered holder of the related Participation Certificate) shall nonetheless be
entitled (and in the case of clause (vi), such termination shall occur
automatically), by written notice to Seller (and in the case of clause (vi)
below immediately without notice), to effect termination of Seller’s servicing
and obligations respecting the affected Mortgage Pool in the event any of the
following circumstances or events (“Servicing Termination Events”) occur and are
continuing:
     (i) the Seller shall default in the payment of (i) any amount payable by it
hereunder or under any other Program Document when the same shall become due and
payable, whether at the due date thereof, or by acceleration or otherwise,
(ii) Expenses or (iii) any other obligations under the Program Documents, when
the same shall become due and payable, whether at the due date thereof, or by
acceleration or otherwise, in each case which failure continues unremedied for a
period of two (2) Business Days; or
     (ii) the failure of the Seller to perform, comply with or observe any term,
covenant or agreement applicable to the Seller contained in any of Sections 10
(a) (i), (xi), (xv), (xvii), (xviii), (xx), (xxii), (xxiii), or (xxx); or
     (iii) any representation, warranty or certification made or deemed made
herein or in any other Program Document by the Seller or any certificate
furnished to the Purchaser pursuant to the provisions hereof or thereof shall
prove to have been untrue or misleading in any material respect as of the time
made or furnished; provided however, a breach of any representation and warranty
set forth in Section 9(b) shall not give rise to a Servicing Termination Event
if the Deficient Mortgage Loan or Deficient Mortgage Pool and the related
Participation Certificate with respect to which such breach relates is
repurchased by the Seller in accordance with Sections 9(c) or 9(d),
respectively; or
     (iv) the Seller shall fail to observe or perform any other covenant or
agreement contained in this Agreement (and not identified in clause (ii) of
Section 5(e)) or any other Program Document, and if such failure to observe or
perform shall be capable of being remedied, and such failure to observe or
perform shall continue unremedied for a period of five (5) Business Days; or
     (v) one or more final judgment(s) or decrees shall be entered against PHH
Parent, Seller or any of Seller’s Subsidiaries (other than the PHH Home Loans
Entities) involving a liability of (A) with respect to PHH Parent, $25,000,000
or more and (B) with

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respect to Seller or any of Seller’s Subsidiaries, $10,000,000 or more (in each
case, to the extent that it is, in the reasonable determination of Purchaser,
uninsured and provided that any insurance or other credit posted in connection
with an appeal shall not be deemed insurance for these purposes), and the same
shall not be satisfied, discharged (or provision shall not be made for such
discharge) or bonded, or a stay of execution thereof shall not be procured,
within 30 days from the date of entry thereof, and the Seller, any of Seller’s
Subsidiaries or PHH Parent shall not, within said period of 30 days, or such
longer period during which execution of the same shall have been stayed or
bonded; or
     (vi) an Event of Insolvency with respect to clauses (b), (c), (d) or
(e) shall have occurred with respect to Seller, any of Seller’s Subsidiaries
(other than the PHH Home Loans Entities), PHH Parent or any of PHH Parent’s
Material Subsidiaries; or an Event of Insolvency pursuant to clause (a) of the
definition thereof, shall have occurred with respect to Seller or PHH Parent; or
     (vii) (A) any Program Document shall for whatever reason be terminated or
cease to be in full force and effect in all material respects or shall not be
enforceable in all material respects in accordance with its terms, (B) any sale
effected or Lien granted pursuant thereto shall fail to be perfected and of
first priority (other than as a result of the action or inaction that
constitutes gross negligence or willful misconduct of the Purchaser and as long
as Seller shall cure such failure within one (1) Business Day) or (C) the Seller
shall grant, or suffer to exist, any Lien on any Participation Certificate or
Mortgage Loan (except any Lien in favor of the Purchaser); or
     (viii) any Person (other than Purchaser) shall contest the validity,
enforceability, perfection or priority of any sale effected or Lien granted
pursuant thereto, or any party thereto (other than Purchaser) shall seek to
disaffirm, terminate, limit or reduce its Obligations hereunder; or
     (ix) (i) default in payment shall be made with respect to any Indebtedness
or Interest Rate Protection Agreements of PHH Parent, Seller or any of Seller’s
Subsidiaries (other than Securitization Indebtedness) where the amount or
amounts of such Indebtedness or Interest Rate Protection Agreements exceeds
(A) with respect to PHH Parent, $25,000,000 (or its equivalent thereof in any
other currency) in the aggregate and (B) with respect to Seller or any of
Seller’s Subsidiaries, $10,000,000 (or its equivalent thereof in any other
currency) in the aggregate; or (ii) default shall be made with respect to the
observance or performance of any other agreement or condition with respect to
any Indebtedness or Interest Rate Protection Agreements of PHH Parent, Seller or
any of Seller’s Subsidiaries (other than Securitization Indebtedness) where the
amount or amounts of such Indebtedness or Interest Rate Protection Agreements
exceeds (A) with respect to PHH Parent, $25,000,000 (or its equivalent thereof
in any other currency) in the aggregate and (B) with respect to Seller or any of
Seller’s Subsidiaries, $10,000,000 (or its equivalent thereof in any other
currency) in the aggregate, if the effect of such default is to result in the
acceleration of the maturity of such Indebtedness or Interest Rate Protection
Agreement; or (iii) any other circumstance shall arise (other than the mere
passage of time) by reason of which of PHH Parent, Seller or any of Seller’s
Subsidiaries is required to redeem or repurchase, or offer to holders the
opportunity to

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have redeemed or repurchased, any such Indebtedness or Interest Rate Protection
Agreement (other than Securitization Indebtedness) where the amount or amounts
of such Indebtedness or Interest Rate Protection Agreement exceeds (A) with
respect to PHH Parent, $25,000,000 (or its equivalent thereof in any other
currency) in the aggregate and (B) with respect to Seller or any of Seller’s
Subsidiaries, $10,000,000 (or its equivalent thereof in any other currency) in
the aggregate; provided that clause (iii) shall not apply to secured
Indebtedness or Interest Rate Protection Agreement that becomes due as a result
of a voluntary sale of the property or assets securing such Indebtedness or
Interest Rate Protection Agreement or Indebtedness that is redeemed or
repurchased at the option of PHH Parent, Seller or any of Seller’s Subsidiaries
or with respect to any Indebtedness that is convertible, in whole or in part,
into shares of capital stock of PHH Parent and/or cash based on any formula(s)
that reference the trading price of shares of capital stock of PHH Parent, any
payment for settlement (whether in cash or otherwise) upon conversion thereof
and provided, further, that clauses (ii) and (iii) shall not apply to any
Indebtedness or Interest Rate Protection Agreement of any of Seller’s
Subsidiaries issued and outstanding prior to the date such Subsidiary became a
Subsidiary of Seller (other than Indebtedness or Interest Rate Protection
Agreement issued in connection with, or in anticipation of, such Subsidiary
becoming a Subsidiary of Seller) if such default or circumstance arises solely
as a result of a “change of control” provision applicable to such Indebtedness
or Interest Rate Protection Agreement which becomes operative as a result of the
acquisition of such Subsidiary by Seller or any of its Subsidiaries; or
     (x) a Material Adverse Effect shall occur; or
     (xi) (A) Seller shall engage in any non-exempt “prohibited transaction” (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(B) any failure to meet the minimum funding standard of Section 412 of the Code,
whether or not waived, or any lien in favor of the PBGC or a Plan shall arise on
the assets of the Seller or any ERISA Affiliate, (C) a Reportable Event shall
occur with respect to, or proceedings shall commence to have a trustee
appointed, or a trustee shall be appointed, to administer or to terminate, any
Plan, which Reportable Event or commencement of proceedings or appointment of a
trustee is, in the reasonable opinion of the Purchaser, likely to result in the
termination of such Plan for purposes of Title IV of ERISA, (D) any Plan shall
terminate for purposes of Title IV of ERISA, (E) the Seller or any ERISA
Affiliate shall, or in the reasonable opinion of the Purchaser is likely to,
incur any liability in connection with a withdrawal from, or the insolvency or
reorganization of, a Multiemployer Plan; or (F) any other event or condition
shall occur or exist with respect to a Plan; and in each case in clauses
(A) through (F) above, such event or condition, together with all other such
events or conditions, if any, could reasonably be expected to have a Material
Adverse Effect; or
     (xii) Reserved; or
     (xiii) Seller’s audited financial statements or notes thereto or other
opinions or conclusions stated therein shall be qualified or limited by
reference to the status of the Seller as a “going concern” or reference of
similar import; or

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     (xiv) A Change of Control shall occur, without prior written consent of
Purchaser;
     (xv) Seller ceases to meet the qualifications for maintaining all Agency
Approvals, provided that, there shall not be a Servicing Termination Event under
this Section 5(e)(xv) in the event that Seller intentionally terminates its
Agency Approvals with Fannie Mae or Freddie Mac (not as a result of Fannie Mae
or Freddie Mac expressing its intention to terminate such Agency Approval), so
long as Seller maintains the approvals from the applicable Agency or HUD
designation to be (i) either a Fannie Mae-approved lender or a Freddie
Mac-approved Seller/Servicer and (ii) a GNMA-approved issuer, a GNMA-approved
servicer, an FHA-approved mortgagee and a VA-approved lender; or
     (xvi) Reserved; or
     (xvii) any failure of Seller to pay the required fees for the use of MERS
System, which failure remains unremedied for a period of five (5) Business Days
or more after Seller’s receipt of written notice from MERS or Purchaser; or
     (xviii) an Agency Security Issuance Failure occurs.
          (f) Remedies. In the case of the events described in subclause
(e)(vi), immediately upon the occurrence of any such event, regardless of
whether notice of such event shall have been given to or by Purchaser or Seller,
and each and every other case, so long as the Servicing Termination Event shall
not have been remedied (but only to the extent, and within the time period, of
any remedy period provided above), in addition to whatever rights Purchaser may
have at law or equity to damages, including injunctive relief and specific
performance, by notice in writing to Seller, (i) any commitment of Purchaser to
purchase Mortgage Loans under this Agreement shall immediately cease and
Purchaser thereafter may in its sole discretion determine whether to purchase
Mortgage Loans; (ii) Purchaser may terminate all the obligations of Seller under
this Agreement and all Outstanding Transactions and (iii) Seller shall deliver
to Purchaser the related Servicing Files. Purchaser shall use reasonable efforts
to provide Seller with concurrent notice of Purchaser’s exercise of remedies
hereunder, provided that failure to do so shall not invalidate the rights or
remedies available to Purchase hereunder.
          Upon receipt by Seller of a written notice from Purchaser delivered in
accordance with Section 6, terminating Seller’s servicing under this Agreement,
all authority and power of Seller respecting its mortgage servicing duties under
this Agreement and any affected Transactions, shall pass to and be vested in the
successor servicer appointed by Purchaser (a “Designated Servicer”). Upon
written request by Purchaser, Seller shall prepare, execute and deliver to the
Designated Servicer any and all documents and other instruments, place in such
successor’s possession all Mortgage Files and Servicing Files, and do or cause
to be done all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, including, but not limited to, the
transfer, endorsement and assignment of the Mortgage Loans and related
documents, at Seller’s sole expense.

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          Section 6. Seller Covenants Regarding Transfer of Servicing.
          In the event Purchaser gives notice to Seller of Purchaser’s intention
to transfer servicing to the Designated Servicer upon the occurrence of any
Servicing Termination Event, expiration or earlier termination of the Servicing
Period (“Servicing Termination Date”), then, in each such case, Seller’s right
to service the Mortgage Loans shall immediately terminate on such Servicing
Termination Date and Seller agrees at its sole expense to take all reasonable
and customary actions, to assist Purchaser, Custodian and Designated Servicer in
effectuating and evidencing transfer of servicing to the Designated Servicer in
compliance with Applicable Law as promptly as possible but in no event later
than 60 days following the Servicing Termination Date (such date of transfer,
the “Servicing Transfer Date”) , including:
          (a) Notice to Mortgagors. Seller shall mail to the mortgagor of each
Mortgage Loan, by such date as may be required by law, a letter advising the
mortgagor of the transfer of the servicing thereof to the Designated Servicer.
Seller shall promptly provide the Designated Servicer with copies of all such
letters. Purchaser shall cause the Designated Servicer to mail a letter to each
such mortgagor advising such mortgagor that the Designated Servicer is the new
servicer of the related Mortgage Loan. Such letters shall be mailed by such date
as may be required by Applicable Law.
          (b) Notice to Taxing Authorities, Insurance Companies and HUD (if
applicable). Seller shall transmit or cause to transmit to the applicable taxing
authorities and insurance companies (including primary mortgage insurers, if
applicable) and/or agents, not less than fifteen (15) days prior to the
Servicing Transfer Date, notification of the transfer of the servicing to the
Designated Servicer and instructions to deliver all notices, tax bills and
insurance statements, as the case may be, to the Designated Servicer from and
after the Servicing Transfer Date. Seller shall promptly provide the Designated
Servicer with copies of all such notices. With respect to any FHA-insured/VA
guaranteed Mortgage Loans in the Mortgage Pool in addition to the requirements
set forth above, Seller shall provide notice to HUD on such forms prescribed by
HUD, or to the VA, as applicable respecting the transfer of insurance credits,
as the case may be. Seller shall be obligated to pay all mortgage insurance
premiums with respect to FHA/VA Mortgage Loans until such notice is received by
HUD or the VA, as applicable.
          (c) Assignment and Endorsements. At Purchaser’s (or Designated
Servicer’s) direction and in Purchaser’s sole discretion, Seller shall, at its
own cost and expense, prepare and/or complete endorsements to Mortgage Notes and
assignments of Mortgages (including any interim endorsements or assignments)
prior to the Servicing Transfer Date.
          (d) Delivery of Servicing Records. Seller shall forward to the
Designated Servicer, not more than thirty (30) days after the Servicing Transfer
Date, all Servicing Files, Mortgage Files and any other Mortgage Loan Documents
in Seller’s possession relating to each Mortgage Loan.
          (e) Escrow Payments. Seller shall provide the Designated Servicer on
or before the Servicing Transfer Date with immediately available funds by wire
transfer in the amount of the net Escrow Payments and suspense balances and all
loss draft balances associated with the Mortgage Loans in an affected Mortgage
Pool. Seller shall provide the Designated Servicer on or before the Servicing
Transfer Date with an accounting statement of Escrow Payments and suspense
balances and loss draft balances sufficient to enable the Designated Servicer to

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reconcile the amount of such payment with the accounts of the Mortgage Loans in
the affected Mortgage Pool. Additionally, Seller shall wire to the Designated
Servicer on or before the Servicing Transfer Date the amount of any agency,
trustee or prepaid Mortgage Loan payments and all other similar amounts held by
Seller.
          (f) Payoffs and Assumptions. Seller shall provide to the Designated
Servicer, on or before the Servicing Transfer Date, copies of all assumption and
payoff statements generated by Seller, on the Mortgage Loans.
          (g) Mortgage Payments Received Prior to Servicing Transfer Date.
Seller shall forward by wire transfer, on or before the Servicing Transfer Date,
all payments received by Seller on each Mortgage Loan in the affected Mortgage
Pools prior to the Servicing Transfer Date to Purchaser.
          (h) Mortgage Payments Received After Servicing Transfer Date. Seller
shall forward the amount of any monthly payments received by Seller after the
Servicing Transfer Date to the Designated Servicer by overnight mail within two
(2) Business Days of the date of receipt. Seller shall notify the Designated
Servicer of the particulars of the payment, which notification requirement shall
be satisfied (except with respect to Mortgage Loans then in foreclosure or
bankruptcy) if Seller forwards with its payments sufficient information to the
Designated Servicer.
          (i) Reconciliation. Not less than five (5) days prior to the Servicing
Transfer Date, Seller shall reconcile principal balances and make any monetary
adjustments reasonably required by the Designated Servicer. Any such monetary
adjustments will be transferred between Seller and the Designated Servicer, as
appropriate.
          (j) IRS Forms. Seller shall timely file all IRS forms which are
required to be filed in relation to the servicing and ownership of the Mortgage
Loans. Seller shall provide copies of such forms to the Designated Servicer upon
request and shall reimburse the Designated Servicer for any costs or penalties
incurred by the Designated Servicer due to Seller’s failure to comply with this
paragraph.
          Seller shall have no obligations with respect to the servicing of the
Mortgage Loans after the Servicing Transfer Date other than as specifically set
forth in this Section 6 and other reasonable and customary action taken by
servicers when transferring servicing.
          In the event Seller fails to perform any of its obligations described
in paragraph (a) through (j) above within the time periods specified therein,
Purchaser may take, or cause to be taken, at Seller’s expense, any of the
actions described therein.
          Section 7. Intent of Parties; Security Interest.
          (a) From and after the issuance of the related Participation
Certificate, the record title of Seller to each Mortgage Loan is retained by
Seller in trust, for the sole purpose of facilitating the servicing of such
Mortgage Loan, and all Collections received on or in connection with such
Mortgage Loan shall be deposited in the Custodial Account and held by Seller in
trust

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for the benefit of the registered holder of the related Participation
Certificate and shall be disbursed only in accordance with this Agreement.
          (b) The sale of a participation in each Mortgage Loan shall be
reflected on Seller’s balance sheet and other financial statements as a sale of
assets by Seller. Seller shall be responsible for maintaining, and shall
maintain, a complete set of books and records for each Mortgage Loan and the
electronic copies thereof shall be clearly marked to reflect the ownership of
each Mortgage Loan by the registered holder of the related Participation
Certificate.
          (c) Purchaser and Seller confirm that each of the Transactions
contemplated herein are purchases and sales and are not loan transactions. In
the event, for any reason, that any Transaction is deemed by any court or
regulatory authority, as a result of a change of law or otherwise, not to be a
purchase and sale of the relevant Participation Certificate, then: the parties
understand and intend that this Agreement and each Transaction constitute a
“securities contract” as that term is defined in § 741(7) of the United States
Bankruptcy Code. In addition to the foregoing, (x) Seller hereby pledges to
Purchaser as security for the performance by Seller of its Obligations under
this Agreement and hereby grants, assigns and pledges to Purchaser a fully
perfected first priority security interest in the Mortgage Loans, the Custodial
Account, the Agency Security to be issued as originally contemplated hereunder
or right to receive such Agency Security when issued and the Takeout Commitments
(and assignments thereof), together with the Mortgage Files, Mortgage Loan
Documents and Pooling Documents and any other contract rights, accounts
(including any interest of Seller in escrow accounts) and any other payments,
rights to payment (including payments of interest or finance charges) and
general intangibles to the extent that the foregoing relates to any Mortgage
Loan; and any other assets relating to the Mortgage Loans (including, without
limitation, any other accounts) or any interest in the Mortgage Loans and all
products and proceeds of any and all of the foregoing, in all instances, whether
now owned or hereafter acquired, now existing or hereafter created
(collectively, the “Basic Collateral”); (y) possession of the Mortgage Loan
Documents, Pooling Documents and any other documentation relating to the
Mortgage Pool or the Agency Security by Custodian or by Seller shall constitute
constructive possession by Purchaser; and (z) Purchaser shall have all the
rights of a secured party pursuant to Applicable Law, and for such purposes this
Agreement shall constitute a security agreement.
          (d) In the event that the servicing of the Mortgage Loans is deemed a
separate property right severable from the Mortgage Loans and Participation
Certificates, and in any event, Seller and Purchaser intend that Purchaser or
its Assignee, as the case may be, shall have, and the Seller hereby grants and
pledges to Purchaser or its Assignee a perfected first priority security
interest in Seller’s right, title and interest in the servicing rights, if any,
to the Mortgage Loans and the Servicing Files related thereto and the proceeds
of any and all of the foregoing in all instances, whether now owned or hereafter
acquired, now existing or hereafter created (“Additional Collateral”; together
with the Basic Collateral, the “Collateral”) free and clear of adverse claims.
          Section 8. Conditions Precedent.
          (a) It shall be a condition precedent to the parties entering into the
initial Transaction, under this Agreement that Purchaser receives the following:

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     (i) a certificate of a secretary or assistant secretary attaching certified
copies of Seller’s certificate of incorporation, by-laws and corporate
resolutions of Seller’s board of directors authorizing the transactions
contemplated hereby;
     (ii) a certificate of incumbency of authorized representatives which sets
forth the names, titles and true signatures of all of those individuals
authorized to execute any document or instrument contemplated by this Agreement
and the Custodial Agreement;
     (iii) an opinion of counsel of the Seller, in form and substance acceptable
to Purchaser;
     (iv) a fully executed Custodial Agreement;
     (v) such other documents reasonably requested by Purchaser; and
     (vi) the Program Fee in accordance with the Fee Letter.
          (b) It shall be a condition precedent to the parties entering into
additional Transactions, under this Agreement that:
     (i) Purchaser receives the Takeout Commitment Assignment(s), duly executed
by Seller;
     (ii) Purchaser receives the documents required pursuant to Section 2(b) of
the Custodial Agreement;
     (iii) Purchaser receives a letter from any Warehouse Lender having a
security interest in the Mortgage Loans, addressed to Purchaser, releasing any
and all right, title and interest in such Mortgage Loans, substantially in the
form of an exhibit to the Custodial Agreement, which may be a Warehouse Lender’s
Release;
     (iv) Purchaser receives a facsimile copy of the Participation Certificate
fully completed by Seller and authenticated by Custodian;
     (v) no Commitment Termination Date, Servicing Termination Event or
Potential Servicing Termination Event shall have occurred and be continuing
under the Program Documents;
     (vi) Purchaser shall have received any Balance Sheet Fee then due and owing
in accordance with the Fee Letter;
     (vii) the representations and warranties made by the Seller (A) contained
in Section 9(a) hereof and (B) with respect to each Mortgage Loan and the
Mortgage Pool subject to the Participation Certificate being purchased on such
Purchase Date, contained in Section 9(b) hereof, shall be true, correct and
complete on and as of such Purchase Date in all material respects with the same
force and effect as if made on and as of such date (or, if any such
representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date);

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     (viii) after giving effect to the requested Transaction, the aggregate
outstanding Purchase Price for all Purchased Mortgage Loans subject to
Outstanding Transactions under this Agreement for which Purchaser has not been
paid the Takeout Amount for the related Agency Security by the applicable
Takeout Buyer as specified in the applicable Takeout Commitment, shall not
exceed the Maximum Purchase Price; and
     (ix) there shall not have occurred a material adverse change in the
financial condition of the Purchaser which affects (or can reasonably be
expected to affect) materially and adversely the ability of the Purchaser to
fund its obligations under this Agreement.
          Section 9. Representations and Warranties.
          (a) Seller hereby represents and warrants to Purchaser as of the date
hereof and as of the date of each issuance and delivery of a Participation
Certificate that:
     (i) Acting as Principal. The Seller will engage in transactions hereunder
as principal.
     (ii) Reserved.
     (iii) Solvency. Neither the Program Documents nor any transaction
thereunder are entered into in contemplation of insolvency or with intent to
hinder, delay or defraud any of the Seller’s creditors. The transfer of the
Participation Certificates subject hereto is not undertaken with the intent to
hinder, delay or defraud any of the Seller’s creditors. The Seller is not
insolvent within the meaning of 11 U.S.C. Section 101(32) and the transfer and
sale of the Participation Certificates pursuant hereto (i) will not cause Seller
to become insolvent, (ii) will not result in any property remaining with the
Seller to be unreasonably small capital, and (iii) will not result in debts that
would be beyond the Seller’s ability to pay as same mature. The Seller received
reasonably equivalent value in exchange for the transfer and sale of the
Participation Certificates subject hereto.
     (iv) No Broker. The Seller has not dealt with any broker, investment
banker, agent, or other person, except for the Purchaser, who may be entitled to
any commission or compensation in connection with the sale of Participation
Certificates pursuant to this Agreement.
     (v) Reserved.
     (vi) Existence. The Seller (a) is a corporation duly organized, validly
existing and in good standing under the laws of the State of New Jersey, (b) has
all requisite corporate or other power, and has all governmental licenses,
authorizations, consents and approvals necessary to own its assets and carry on
its business as now being or as proposed to be conducted, except where the lack
of such licenses, authorizations, consents and approvals would not be reasonably
likely to have a Material Adverse Effect; and (c) is qualified to do business
and is in good standing in all other jurisdictions in which the nature of the
business conducted by it makes such qualification necessary,

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except where failure so to qualify would not be reasonably likely (either
individually or in the aggregate) to have a Material Adverse Effect.
     (vii) Financial Statements. The Seller has heretofore furnished to the
Purchaser a copy of its (a) consolidated balance sheet and the consolidated
balance sheets of its Consolidated Subsidiaries for the fiscal year ended
December 31, 2009 and the related Consolidated statements of income and retained
earnings and of cash flows for the Seller and its consolidated Subsidiaries for
such fiscal year, setting forth in each case in comparative form the figures for
the previous year, with the opinion thereon of Deloitte & Touche LLP and
(b) consolidated balance sheet for the quarterly fiscal periods of the Seller
ended March 31, 2010 and June 30, 2010 and the related consolidated statements
of income and retained earnings and of cash flows for the Seller and its
Consolidated Subsidiaries for such quarterly fiscal periods, setting forth in
each case in comparative form the figures for the previous year. All such
financial statements are complete and correct and fairly present, in all
material respects, the consolidated financial condition of the Seller and its
Consolidated Subsidiaries and the consolidated results of their operations as at
such dates and for such fiscal periods, all in accordance with GAAP applied on a
consistent basis. Since June 30, 2010, there has been no material adverse change
in the consolidated business, operations or financial condition of the Seller
and its Consolidated Subsidiaries taken as a whole from that set forth in said
financial statements nor is the Seller aware of any state of facts which
(without notice or the lapse of time) would or could result in any such material
adverse change. The Seller does not have, on the date of the statements
delivered pursuant to this section (the “Statement Date”) any liabilities,
direct or indirect, fixed or contingent, matured or unmatured, known or unknown,
or liabilities for taxes, long-term leases or unusual forward or long-term
commitments not disclosed by, or reserved against in, said balance sheet and
related statements.
     (viii) No Breach. Neither (a) the execution and delivery of the Program
Documents nor (b) the consummation of the transactions therein contemplated to
be entered into by the Seller in compliance with the terms and provisions
thereof will conflict with or result in (x) a breach of the articles of
incorporation or by-laws with respect to the Seller, or (y) a material breach of
any Applicable Law, rule or regulation, or any order, writ, injunction or decree
of any Governmental Authority, or other material agreement or instrument to
which Seller is a party or by which Seller or any of its Property is bound or to
which any of them is subject, or constitute a Potential Servicing Termination
Event under any such material agreement or instrument or result in the creation
or imposition of any Lien (except for the Liens created pursuant to the Program
Documents) upon any Property of the Seller or any of its Subsidiaries pursuant
to the terms of any such agreement or instrument. The consummation of the
transactions contemplated by this Agreement are in the ordinary course of
business of Seller.
     (ix) Action. The Seller has all necessary corporate or other power,
authority and legal right to execute, deliver and perform its Obligations under
each of the Program Documents, as applicable; the execution, delivery and
performance by Seller of each of the Program Documents have been duly authorized
by all necessary corporate or other

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action on its part; and each Program Document has been duly and validly executed
and delivered by Seller, as applicable.
     (x) Approvals. No authorizations, approvals or consents of, and no filings
or registrations with, any Governmental Authority or any securities exchange are
necessary for the execution, delivery or performance by the Seller of the
Program Documents or for the legality, validity or enforceability thereof,
except for filings and recordings in respect of the Liens created pursuant to
the Program Documents. The transfers, assignments and conveyances provided for
herein are not subject to the bulk transfer or any similar statutory provisions
in effect in any applicable jurisdiction.
     (xi) Enforceability. This Agreement and all of the other Program Documents
executed and delivered by the Seller in connection herewith are legal, valid and
binding obligations of the Seller and are enforceable against the Seller in
accordance with their terms except as such enforceability may be limited by
(i) the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors rights generally and (ii) general
principles of equity.
     (xii) Indebtedness. As of the Revolver Fourth Amendment Effective Date, the
Seller does not have any Indebtedness, except as disclosed on Exhibit E to this
Agreement.
     (xiii) No Material Adverse Effect. Since June 30, 2010 there has been no
development or event which has had, or is reasonably likely to have, a Material
Adverse Effect.
     (xiv) No Potential Servicing Termination Event. No Potential Servicing
Termination Event or Servicing Termination Event has occurred and is continuing.
     (xv) Litigation. To the actual knowledge of each Responsible Officer of
Seller, there are no actions, suits, arbitrations, investigations (including,
without limitation, any of the foregoing which are threatened or pending) or
other legal or arbitrable proceedings affecting Seller or any of its
Subsidiaries or affecting any of the Property of any of them before any
Governmental Authority that (i) questions or challenges the validity or
enforceability of any of the Program Documents or any action to be taken in
connection with the transactions contemplated hereby, (ii) makes a claim
individually in an amount greater than $10,000,000 or in an aggregate amount
greater than $25,000,000, or (iii) which, individually or in the aggregate, if
adversely determined, could be reasonably likely to have a Material Adverse
Effect.
     (xvi) Taxes. The Seller has timely filed all tax returns that are required
to be filed by it and has timely paid all Taxes, 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. There are no material Liens for Taxes, except for (A) statutory liens
for Taxes not yet due and payable or (B) 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.

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     (xvii) Investment Company Act. 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.
     (xviii) Participation Certificates.
(A) The Seller has not assigned, pledged, or otherwise conveyed or encumbered
any Mortgage Loan to any other Person, and immediately prior to the sale of the
related Participation Certificate to the Purchaser, the Seller was the sole
owner of such Mortgage Loan and had good and marketable title thereto, free and
clear of all Liens, in each case except for Liens to be released simultaneously
with the sale to the Purchaser hereunder.
(B) The provisions of this Agreement are effective to either constitute a sale
of the Participation Certificate and the beneficial interest in the Mortgage
Pool to the Purchaser or to create in favor of the Purchaser a valid security
interest in all right, title and interest of the Seller in, to and under the
Mortgage Pool.
     (xix) Chief Executive Office/Jurisdiction of Organization. On the Effective
Date, the Seller’s chief executive office, is located at 1 Mortgage Way, Mt.
Laurel, New Jersey 08054. On the Effective Date, and during the four months
immediately preceding the Effective Date, the Seller’s jurisdiction of
organization is the State of New Jersey.
     (xx) Location of Books and Records. The location where the Seller keeps its
books and records, including all computer tapes and records related to the
Mortgage Pool is its chief executive office, provided that, Seller may keep
backup copies of its books and records at other locations.
     (xxi) Reserved.
     (xxii) True and Complete Disclosure. The information, reports, financial
statements, exhibits and schedules furnished in writing by or on behalf of the
Seller to the Purchaser in connection with the negotiation, preparation or
delivery of this Agreement and the other Program Documents or included herein or
therein or delivered pursuant hereto or thereto, when taken as a whole, do not
contain any untrue statement of material fact or omit to state any material fact
necessary to make the statements herein or therein, in light of the
circumstances under which they were made, not misleading. There is no fact known
to a Responsible Officer of the Seller, after due inquiry, that could reasonably
be expected to have a Material Adverse Effect that has not been disclosed
herein, in the other Program Documents or in a report, financial statement,
exhibit, schedule, disclosure letter or other writing furnished to the Purchaser
for use in connection with the transactions contemplated hereby or thereby.
     (xxiii) ERISA.
(A) No liability under Section 4062, 4063, 4064 or 4069 of ERISA has been or is
expected by the Seller to be incurred by the Seller or any ERISA Affiliate
thereof with respect to any Plan which is a Single-Employer Plan in an amount
that could reasonably be expected to have a Material Adverse Effect.

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(B) No Plan which is a Single-Employer Plan failed to meet the minimum funding
standard under Section 412 of the Code, whether or not waived, as of the last
day of the most recent fiscal year of such Plan ended prior to the date hereof.
Neither the Seller nor any ERISA Affiliate thereof is (i) required to give
security to any Plan which is a Single-Employer Plan pursuant to
Section 412(c)(4) of the Code, or (ii) subject to a lien in favor of such a Plan
under Section 303(k) of ERISA.
(C) Each Plan of the Seller and its Subsidiaries and its ERISA Affiliates is in
compliance in all material respects with the applicable provisions of ERISA and
the Code, except where the failure to comply would not result in any Material
Adverse Effect.
(D) Neither Seller nor any of its Subsidiaries have incurred a tax liability
under Section 4975 of the Code or a penalty under Section 502(i) of ERISA in
respect of any Plan which has not been paid in full, except where the incurrence
of such tax or penalty would not result in a Material Adverse Effect.
(E) Neither Seller nor any of its Subsidiaries or any ERISA Affiliate thereof
has incurred or reasonably expects to incur any withdrawal liability under
Section 4201 of ERISA as a result of a complete or partial withdrawal from a
Multiemployer Plan which will result in withdrawal liability to the Seller and
any of its Subsidiaries or any ERISA Affiliate thereof in an amount that could
reasonably be expected to have a Material Adverse Effect.
     (xxiv) Agency Approvals. Seller is approved by the applicable Agency or HUD
or VA approved designation to be (A) either or both (1) a Fannie Mae approved
lender and (2) a Freddie Mac approved seller/servicer (as the case may be) and
(b) a GNMA approved issuer, an FHA approved mortgagee and a VA approved lender,
in each case in good standing (such collective approvals and conditions, “Agency
Approvals”), with no event having occurred prior to the issuance of the Agency
Security, including without limitation a change in insurance coverage which
would either make Seller 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. Seller has adequate financial standing, servicing
facilities, procedures and experienced personnel necessary for the servicing of
mortgage loans of the same types as may from time to time constitute Mortgage
Loans in accordance with Accepted Servicing Practices.
     (xxv) No Reliance. The Seller has made its own independent decisions to
enter into the Program Documents and each Transaction and as to whether such
transaction is appropriate and proper for it based upon its own judgment and
upon advice from such advisors (including without limitation, legal counsel and
accountants) as it has deemed necessary. The Seller is not relying upon any
advice from Purchaser as to any aspect of the Transactions, including without
limitation, the legal, accounting or tax treatment of such Transactions.

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     (xxvi) Plan Assets. The Seller is not an employee benefit plan as defined
in Section 3 of Title I of ERISA, or a plan described in Section 4975(e)(1) of
the Code, and the Mortgage Loans are not “plan assets” within the meaning of 29
CFR §2510.3-101 in Seller’s hands.
     (xxvii) Anti Money Laundering Laws. The Seller has complied with all
applicable anti money laundering laws and regulations, including without
limitation all applicable provisions of the USA Patriot Act of 2001
(collectively, the “Anti Money Laundering Laws”); the Seller has established an
anti money laundering compliance program as required by any applicable Anti
Money Laundering Laws, has conducted the requisite due diligence in connection
with the origination of each Mortgage Loan for purposes of any applicable Anti
Money Laundering Laws, including with respect to the legitimacy of the
applicable Mortgagor and the origin of the assets used by the said Mortgagor to
purchase the property in question, and maintains, and will maintain, sufficient
information to identify the applicable Mortgagor for purposes of any applicable
Anti Money Laundering Laws.
     (xxviii) No Prohibited Persons. Neither Seller nor any of its Affiliates,
officers, directors, partners or members, is an entity or person (or to the
Seller’s knowledge, owned or controlled by an entity or person): (i) that is
listed in the Annex to, or is otherwise subject to the provisions of Executive
Order 13224 issued on September 24, 2001 (“EO13224”); (ii) whose name appears on
the United States Treasury Department’s Office of Foreign Assets Control
(“OFAC”) most current list of “Specifically Designated National and Blocked
Persons” (which list may be published from time to time in various mediums
including, but not limited to, the OFAC website,
http:www.treas.gov/ofac/t11sdn.pdf); (iii) who commits, threatens to commit or
supports “terrorism”, as that term is defined in EO13224; or (iv) who is
otherwise affiliated with any entity or person listed above (any and all parties
or persons described in clauses (i) through (iv) above are herein referred to as
a “Prohibited Person”).
     (xxix) Eligibility of Custodian. The Custodian is an eligible custodian
under the Agency Guide and Agency Program;
     (xxx) Takeout Commitment. Each related Takeout Commitment constitutes a
valid, binding and enforceable mandatory delivery commitment by a Takeout Buyer
to purchase on the Settlement Date and at a given Takeout Price the principal
amount of the Agency Security described therein.
          (b) Seller hereby represents and warrants to Purchaser with respect to
each Mortgage Loan and the related Mortgage Pool as of the relevant Purchase
Date:
     (i) Agency Eligibility. Each Mortgage Loan is an Agency Eligible Mortgage
Loan.
     (ii) Mortgage Loan Schedule. The Mortgage Loan Schedule contains a complete
listing and schedule of the Mortgage Loans, and the information contained on
such Mortgage Loan Schedule is accurate and complete in all material respects.

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     (iii) Agency Representations. As to both the Mortgage Pool and each
Mortgage Loan, they each meet all the criteria for issuance of an Agency
Security and all of the representations and warranties made or deemed made
respecting same contained in (or incorporated by reference therein) the relevant
Agency Guide provisions and Agency Program (collectively, the “Standard Agency
Mortgage Loan Representations”) and all information provided to the Agencies are
(and shall be as of all relevant dates) true and correct in all material
respects; and except as may be expressly and previously disclosed to Purchaser
or modified in accordance with the terms of this Agreement, Seller has not
negotiated with the Agency any exceptions or modifications to such Standard
Agency Mortgage Loan Representations.
          (c) If any Mortgage Loan is a Deficient Mortgage Loan on the Purchase
Date of the related Participation Certificate, Purchaser in its sole discretion
may require Seller, upon receipt of notice from Purchaser of its exercise of
such right, to either (x) immediately repurchase Purchaser’s beneficial
ownership interest in such Deficient Mortgage Loan by remitting to Purchaser the
allocable amount paid by Purchaser for such beneficial interest plus accrued
interest on a per annum basis at the rate specified in the related Mortgage Note
on the principal amount thereof from the Purchase Date of such Participation
Certificate to the date of such repurchase together with any Losses suffered by
Purchaser relating to such repurchase (including, without limitation, any Losses
incurred by Purchaser resulting from adjustments to the trade required by the
Takeout Buyer), or (y) deliver to Custodian a Mortgage Loan eligible to back
such Agency Security in exchange for such Deficient Mortgage Loan, which newly
delivered Mortgage Loan shall be in all respects acceptable under the applicable
Agency Program and acceptable to Purchaser in Purchaser’s sole discretion, and
(i) such newly delivered Mortgage Loan will thereupon become one of the Mortgage
Loans relating to the Participation Certificate and (ii) the Deficient Mortgage
Loan will thereupon cease being one of the Mortgage Loans, cease being subject
to the Participation Certificate and the Seller shall be deemed to have
repurchased 100% of the beneficial ownership interest in such Deficient Mortgage
Loan. If the aggregate principal balance of any Mortgage Loans that are accepted
by Purchaser pursuant to clause (y) of the immediately preceding sentence is
less than the aggregate principal balance of any Deficient Mortgage Loan that is
being replaced by such Mortgage Loan, Seller shall remit with such Mortgage Loan
to Purchaser an amount equal to the difference between the aggregate principal
balance of the new Mortgage Loan accepted by Purchaser and the aggregate
principal balance of the Deficient Mortgage Loan being replaced thereby (the
“Replacement Shortfall”) plus accrued interest on such Deficient Mortgage Loan
at the rate specified in the related Mortgage Note on the Replacement Shortfall
from the Purchase Date of Purchaser’s purchase of the related Participation
Certificate to the date of substitution. If the Purchase Price of any Mortgage
Loan that is accepted by Purchaser pursuant to clause (y) of the second
preceding sentence is greater than the Purchase Price of any Deficient Mortgage
Loan that is being replaced by such Mortgage Loan, Purchaser shall remit to
Seller an amount equal to the difference between the Purchase Price of the new
Mortgage Loan accepted by Purchaser and the Purchase Price of the Deficient
Mortgage Loan being replaced thereby.
          (d) If any Mortgage Pool is a Deficient Mortgage Pool on the Purchase
Date of the related Participation Certificate, Seller shall, upon the earlier to
occur of knowledge and receipt of notice from Purchaser immediately repurchase
Purchaser’s beneficial ownership interest in such Deficient Mortgage Pool and
the related Participation Certificate by remitting to

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Purchaser the Purchase Price paid by Purchaser for such beneficial interest plus
accrued interest at the Participation Certificate Pass-Through Rate from the
Purchase Date of such Participation Certificate to the date of such repurchase
together with any Losses suffered by Purchaser relating to such repurchase
(including, without limitation, any Losses incurred by Purchaser resulting from
adjustments to the trade required by the Takeout Buyer).
          (e) At the time of repurchase by Seller pursuant to Sections 9(c) or
9(d), the Purchaser and the Seller shall arrange for the reassignment of the
Deficient Mortgage Loan or the Deficient Mortgage Pool to the Seller and the
delivery to the Seller of any documents held by the Custodian relating to the
Deficient Mortgage Loan or the Deficient Mortgage Pool. In the event of a
repurchase by Seller pursuant to Sections 9(c) or 9(d), (i) the Seller shall,
simultaneously with such reassignment, give written notice to the Purchaser that
such repurchase has taken place and amend the Mortgage Loan Schedule to reflect
the withdrawal of the Deficient Mortgage Loan or the Deficient Mortgage Pool
from this Agreement and (ii) Purchaser shall promptly return to Seller the
repurchased Deficient Mortgage Loan or Deficient Mortgage Pool, as applicable,
and the related Participation Certificate.
          (f) The representations and warranties set forth in this Agreement
shall survive transfer of the Participation Certificates to Purchaser and shall
continue for so long as the Participation Certificates are subject to this
Agreement. Any cause of action against the Seller relating to or arising out of
a material breach of any of the representations and warranties made in this
Section 9 shall accrue as to any Mortgage Loan or Mortgage Pool upon
(i) discovery of such material breach by the Purchaser or notice thereof by the
Seller to the Purchaser, (ii) failure by the Seller to cure such material breach
or repurchase such Mortgage Loan or Mortgage Pool as specified above, and
(iii) demand upon the Seller by the Purchaser for compliance with this
Agreement.
          Section 10. Covenants of Seller.
          (a) On and as of the date of this Agreement and each Purchase Date and
each day until this Agreement is no longer in force, the Seller covenants as
follows:

  (i)   Preservation of Existence; Compliance with Law. The Seller shall:    
(A)   Preserve and maintain its legal existence;     (B)   Preserve and maintain
all of its material rights, privileges, licenses and franchises necessary for
the operation of its business if the failure to comply with such requirements
would be reasonably likely (either individually or in the aggregate) to have a
Material Adverse Effect;     (C)   Comply with the requirements of all material
Applicable Laws, material rules, material regulations and material orders,
whether now in effect or hereafter enacted or promulgated by any applicable
Governmental Authority (including, without limitation, all environmental laws);
    (D)   Maintain all licenses, permits or other approvals necessary for the
Seller to conduct its business and to perform its Obligations under the Program

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      Documents if the failure to comply with such requirements would be
reasonably likely (either individually or in the aggregate) to have a Material
Adverse Effect;     (E)   Keep adequate records and books of account, in which
complete entries will be made in accordance with GAAP consistently applied; and
    (F)   Permit representatives of the Purchaser, upon reasonable notice
(unless an Event of Default shall have occurred and is continuing, in which
case, no prior notice shall be required), during normal business hours, to
examine, copy and make extracts from its books and records, to inspect any of
its properties, and to discuss its business and affairs with its officers, all
to the extent reasonably requested by the Purchaser.

     (ii) Taxes. The Seller and its Subsidiaries shall timely file all tax
returns that are required to be filed by them and shall timely pay all Taxes
due, 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.
     (iii) Notice of Proceedings or Adverse Change. The Seller shall give notice
to the Purchaser promptly after a Responsible Officer of the Seller has any
knowledge of:
(a) the occurrence of any Potential Servicing Termination Event or Servicing
Termination Event;
(b) any (x) default or event of default under any Indebtedness of the Seller or
(y) any Material Adverse Effect;
(c) (y) any litigation, investigation, regulatory action or proceeding that is
pending or threatened by or against the Seller in any federal or state court or
before any Governmental Authority in which the amount involved exceeds
$10,000,000 individually or $25,000,000 in the aggregate, in which injunctive or
similar relief is sought, or which, if adversely determined, would reasonably be
expected to have a Material Adverse Effect or constitute a Potential Servicing
Termination Event or Servicing Termination Event and (z) any litigation or
proceeding that is pending or threatened in connection with any of the Mortgage
Pool, which, if adversely determined, would reasonably be expected to have a
Material Adverse Effect;
(d) and, as soon as reasonably possible, notice of any of the following events:
     (A) a change in the insurance coverage of the Seller, with a copy of
evidence of same attached;
     (B) any change to the date on which Seller’s fiscal year begins from
Seller’s current fiscal year beginning date;
     (C) the termination or nonrenewal of any debt facilities of the Seller
which have a maximum principal amount (or equivalent) available of more than
$25,000,000;

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     (D) promptly upon receipt of notice or knowledge of any Lien or security
interest (other than security interests created hereby or under any other
Program Document) on, or claim asserted against, any of the Mortgage Pool;
     (E) any other event, circumstance or condition that has resulted, or has a
possibility of resulting, in a Material Adverse Effect;
     (F) Promptly, but no later than two (2) Business Days after the Seller
receives any of the same, deliver to the Purchaser a true, complete, and correct
copy of any schedule, report, notice, or any other document delivered to the
Seller by any Person pursuant to, or in connection with, any of the Mortgage
Pool; and
     (G) Promptly, but no later than two (2) Business Days after the Seller
receives notice of the same, any Mortgage Loan submitted for inclusion into an
Agency Security and rejected by that Agency for inclusion in such Agency
Security.
     (iv) Reserved
     (v) Financial Reporting. The Seller shall maintain a system of accounting
established and administered in accordance with GAAP, and furnish to the
Purchaser:

  (A)   As soon as is practicable, but in any event within 90 days after the end
of each fiscal year of Seller, (1) consolidated statements of income (or
operations) and consolidated statements of cash flows and changes in
stockholders’ equity of Seller and its Consolidated Subsidiaries for such year
and the related consolidated balance sheets as at the end of such year and (2)
an opinion of independent certified public accountants of recognized national
standing, which opinion shall state that said consolidated financial statements
fairly present the consolidated financial position and results of operations of
Seller and its Consolidated Subsidiaries as at the end of, and for, such fiscal
year and that such financial statements were prepared in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods;     (B)   As soon as is practicable, but in any event within 90 days
after the end of each fiscal year of PHH Parent, (1) either (x) consolidated
statements of income (or operations) and consolidated statements of cash flows
and changes in stockholders’ equity of PHH Parent and its Consolidated
Subsidiaries for such year and the related consolidated balance sheets as at the
end of such year, or (y) the Form 10-K filed by PHH Parent with the SEC and
(2) if not included in such Form 10-K, an opinion of independent certified
public accountants of recognized national standing, which opinion shall state
that said consolidated financial statements fairly present the consolidated
financial position and results of operations of PHH Parent and its Consolidated
Subsidiaries as at the end of, and for, such fiscal year and that such financial
statements were prepared in accordance with

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      GAAP applied consistently throughout the periods reflected therein and
with prior periods;     (C)   Simultaneously with the furnishing of each of the
financial statements to be delivered pursuant to subsection (A) and (B) above,
or monthly upon Purchaser’s request, a certificate in the form of Exhibit F
hereto and certified by an executive officer of the Seller;     (D)   Seller
shall cause to be delivered to Purchaser, as soon as practicable, but in any
event within 90 days after the end of each fiscal year of PHH Parent, detailed
projections of PHH Parent and its Consolidated Subsidiaries for the then current
year and, as soon as available, significant revisions of any such projections,
provided that, since such projections are by their nature only estimates, to the
extent delivered to the best of knowledge and in good faith, such projections
shall be delivered without any representation or warranty by Seller or PHH
Parent as to the accuracy or completeness of such projections;     (E)   If
applicable, copies of any registration statements and other “corporate finance”
SEC filings (other than 8-Ks, 10-Ks, 10-Qs and proxy statements) by the Seller
within 5 Business Days of their filing with the SEC; provided, that, the Seller
or any Affiliate will provide the Purchaser with a copy of the annual 10-K of
PHH Parent filed with the SEC by the Seller or its affiliates, no later than
90 days after the end of the year;     (F)   Upon request of Purchaser, Seller
will furnish to Purchaser a summary of the portfolio performance on a rolling
monthly period stratified by percentage repurchase demands for: representation
breaches, missing document breaches, repurchases due to fraud, early payment
default requests, summarized on the basis of (a) pending repurchase demands
(including weighted average duration of outstanding request), (b) satisfied
repurchase demands, (c) total repurchase demands;     (G)   Upon request of
Purchaser, Seller will furnish a monthly mortgage loan production report
reflecting the Seller’s monthly mortgage loan production and acquisition
volumes, as well as its mortgage loan pipeline; and     (H)   Promptly, from
time to time, such other information regarding the business affairs, operations
and financial condition of the Seller, as the Purchaser may reasonably request.

      (vi) Visitation and Inspection Rights. The Seller shall permit the
Purchaser to inspect, and to discuss with the Seller’s officers, independent
accountants, the affairs, finances, and accounts of the Seller, its Properties,
the Mortgage Pool, and the Seller’s books and records, and to make abstracts or
reproductions thereof and to duplicate, reduce to hard copy or otherwise use any
and all computer or electronically stored information or data, in each case,
(i) during normal business hours, (ii) upon reasonable

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notice (provided, that upon the occurrence of an Servicing Termination Event, no
notice shall be required), and (iii) at the expense of the Seller to discuss
with its officers, its affairs, finances, and accounts.
     (vii) Reimbursement of Expenses. The Seller shall promptly reimburse the
Purchaser for all reasonable expenses as the same are incurred by the Purchaser
and within thirty (30) days of the receipt of invoices therefor.
     (viii) Further Assurances. The Seller shall execute and deliver to the
Purchaser all further documents, financing statements, agreements and
instruments of transfer, conveyance and assignment, and take all further action
that may be required under Applicable Law, or that the Purchaser may reasonably
request, in order to effectuate the transactions contemplated by this Agreement
and the Program Documents. The Seller shall fully perform or cause to be
performed when due all of its Obligations under any Program Documents.
     (ix) True and Correct Information. All information, reports, exhibits,
schedules, financial statements or certificates furnished by or on behalf of
Seller or any of its officers furnished to Purchaser in connection with the
performance of this Agreement and the other Program Documents or included herein
or therein or delivered pursuant hereto or thereto and during Purchaser’s
diligence of the Seller are and will be true and complete and do not contain any
untrue statement of material fact or omit to disclose any material facts
necessary to make the statements therein or therein, in light of the
circumstances in which they are made, not misleading. All required financial
statements, information and reports delivered by the Seller to the Purchaser
pursuant to this Agreement shall be prepared in accordance with GAAP, or if
applicable, to SEC filings, the appropriate SEC accounting requirements.
     (x) ERISA Events.
(A) Promptly upon becoming aware of the occurrence of any Event of Termination
which together with all other Events of Termination occurring within the prior
12 months involve a payment of money by or a potential aggregate liability of
the Seller or any ERISA Affiliate thereof or any combination of such entities in
excess of $10,000,000 the Seller shall give the Purchaser a written notice
specifying the nature thereof, what action the Seller or any ERISA Affiliate
thereof has taken and, when known, any action taken or threatened by the
Internal Revenue Service, the Department of Labor or the PBGC with respect
thereto;
(B) Promptly upon receipt thereof, the Seller shall furnish to the Purchaser
copies of (i) all notices received by the Seller or any ERISA Affiliate thereof
of the PBGC’s intent to terminate any Plan or to have a trustee appointed to
administer any Plan; (ii) all notices received by the Seller or any ERISA
Affiliate thereof from the sponsor of a Multiemployer Plan pursuant to
Section 4202 of ERISA involving a withdrawal liability in excess of $10,000,000;
and (iii) all funding waiver requests filed by the Seller or any ERISA Affiliate
thereof with the Internal Revenue Service with respect to any Plan, the accrued
benefits of which exceed the present value of the plan assets as of the date the

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waiver request is filed by more than $10,000,000, and all communications
received by the Seller or any ERISA Affiliate thereof from the Internal Revenue
Service with respect to any such funding waiver request.

  (xi)   Financial Condition Covenants.     (A)   Minimum Consolidated Net
Worth. PHH Parent shall have a Consolidated Net Worth on the last day of any
fiscal quarter ended after the Revolver Fourth Amendment Effective Date of at
least $1,000,000,000.     (B)   Maximum Leverage Ratio. PHH Parent and its
Subsidiaries shall at all times have a ratio of Indebtedness to Tangible Net
Worth of no greater than 6.5 to 1.0.     (C)   Available Financing. PHH Parent
and its Subsidiaries shall maintain, at all times, aggregate Available Borrowing
Capacity of at least $1,000,000,000 (excluding uncommitted warehouse capacity
provided by Government-Sponsored Enterprises), provided that no more than
$500,000,000 of such capacity is in respect of facilities that are exclusively
gestation facilities.

     (xii) Insurance. Seller shall continue to maintain, for itself and its
Subsidiaries, Fidelity Insurance in an aggregate amount at least equal to
$2,000,000. Seller shall maintain, for itself and its Subsidiaries, Fidelity
Insurance in respect of its officers, employees and agents, with respect to any
claims made in connection with all or any portion of the Mortgage Loans. Seller
shall notify the Purchaser of any material change in the terms of any such
Fidelity Insurance.
     (xiii) Books and Records. The Seller shall, to the extent practicable,
maintain and implement administrative and operating procedures (including,
without limitation, an ability to recreate records evidencing the Mortgage Pool
in the event of the destruction of the originals thereof), and keep and maintain
or obtain, as and when required, all documents, books, records and other
information reasonably necessary or advisable for the collection of the Mortgage
Pool.
     (xiv) Reserved.
     (xv) Material Change in Business. The Seller shall not make any material
change in the nature of its business as carried on at the date hereof.
     (xvi) Reserved.
     (xvii) Disposition of Assets; Liens. The Seller shall not cause any
Mortgage Pool to be sold, pledged, assigned or transferred; nor shall the Seller
create, incur, assume or suffer to exist any mortgage, pledge, Lien, charge or
other encumbrance of any nature whatsoever on any Mortgage Pool, whether real,
personal or mixed, now or hereafter

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owned, other than Liens in favor of the Purchaser or otherwise permitted in
accordance with this Agreement.
     (xviii) Transactions with Affiliates. The Seller shall not enter into any
transaction, including, without limitation, the purchase, sale, lease or
exchange of property or assets or the rendering or accepting of any service with
any Affiliate, unless such transaction is (a) not otherwise prohibited in this
Agreement, (b) in the ordinary course of the Seller’s business and (c) upon fair
and reasonable terms no less favorable to the Seller, as the case may be, than
they would obtain in a comparable arm’s length transaction with a Person which
is not an Affiliate. For the avoidance of doubt the Permitted Affiliate
Transactions shall not constitute a violation of this Section 10(a)(xviii).
     (xix) ERISA Matters.
(a) The Seller shall not permit any event or condition which is described in any
of clauses (a) through (h) of the definition of “Event of Termination” to occur
or exist with respect to any Plan or Multiemployer Plan if such event or
condition, together with all other events or conditions described in the
definition of Event of Termination occurring within the prior 12 months, results
in the payment of money by or an incurrence of liability of the Seller or any
ERISA Affiliate thereof, or any combination of such entities in an amount in
excess of $10,000,000.
(b) The Seller shall not be an employee benefit plan as defined in Section 3(3)
of Title I of ERISA, or a plan described in Section 4975(e)(1) of the Code and
Seller shall not use “plan assets” within the meaning of 29 CFR §2510.3-101 as
modified by Section 3(42) of ERISA to engage in this Agreement or the
Transactions hereunder.
     (xx) Consolidations, Mergers and Sales of Assets. Seller shall not (i)
consolidate or merge with or into any other Person or (ii) sell, lease or
otherwise transfer all or substantially all of its assets to any other Person;
provided that the Seller may merge or consolidate with another Person if the
Seller is the corporation surviving such merger, provided, further, that Seller
may acquire and sell mortgage loans in the ordinary course of Seller’s mortgage
banking business and such activity shall not constitute a breach of this clause.
     (xxi) Reserved.
     (xxii) Agency Approvals; Servicing. The Seller shall maintain its Agency
Approvals. Should the Seller, for any reason, cease to possess all such
applicable Agency Approvals to the extent necessary, or should notification to
the relevant Agency or to HUD, FHA or VA be required, the Seller shall so notify
Purchaser immediately in writing.
     (xxiii) Limitation on Indebtedness. No Material Subsidiary of PHH Parent
(or in the case of Sections 10(a)(xxiii)(J) and (L), its Subsidiaries) shall
incur, assume or suffer to exist any Indebtedness, except:

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  (A)   Indebtedness in existence on the Revolver Fourth Amendment Effective
Date, or required to be incurred pursuant to a contractual obligation in
existence on the Revolver Fourth Amendment Effective Date, which in either case
(to the extent not otherwise permitted by paragraphs (B)-(I) of this
Section 10(a)(xxiii)), is listed on Exhibit E hereto, but not any extensions or
renewals thereof, unless effected on substantially the same terms or on terms
not more adverse to the Lenders (as defined in the Revolving Credit Facility as
of the Revolver Fourth Amendment Effective Date);     (B)   purchase money
Indebtedness (including Capital Leases);     (C)   Indebtedness owing by any
Material Subsidiary of PHH Parent to PHH Parent or any other Subsidiary of PHH
Parent;     (D)   Indebtedness of any Material Subsidiary of PHH Parent issued
and outstanding prior to the date on which such Subsidiary became a Subsidiary
of PHH Parent (other than Indebtedness issued in connection with, or in
anticipation of, such Subsidiary becoming a Subsidiary of PHH Parent); provided
that immediately prior and on a Pro Forma Basis after giving effect to such
Person becoming a Subsidiary of PHH Parent, no Default or Event of Default (as
such terms are defined in the Revolving Credit Facility as of the Revolver
Fourth Amendment Effective Date) shall occur or then be continuing and the
aggregate principal amount of such Indebtedness, when added to the aggregate
outstanding principal amount of Indebtedness permitted by paragraphs (E) and
(F) below, shall not exceed $150,000,000;     (E)   any renewal, extension or
modification of Indebtedness under paragraph (iv) above so long (a) as such
renewal, extension or modification is effected on substantially the same terms
or on terms which, in the aggregate, are not more adverse to the Lenders (as
defined in the Revolving Credit Facility as of the Revolver Fourth Amendment
Effective Date) and (b) the principal amount of such Indebtedness is not
increased;     (F)   other Indebtedness of any Material Subsidiary of PHH Parent
(to the extent not otherwise permitted by this Section 10(a)(xxiii)), in an
aggregate principal amount which, when added to the aggregate outstanding
principal amount of Indebtedness permitted by paragraphs (iv) and (v) above,
does not exceed $150,000,000;     (G)   Indebtedness of Special Purpose Vehicle
Subsidiaries incurred to finance investments in lease agreements and vehicles by
such Subsidiaries, so long as the lender (and any other party) in respect of
such Indebtedness has recourse, if any, solely to the assets of such Special
Purpose Vehicle Subsidiary;

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  (H)   Indebtedness of any Asset Securitization Subsidiary incurred solely to
finance asset securitization transactions as long as the lender (and any other
party) in respect of such Indebtedness has recourse (other than customary
limited recourse based on misrepresentations or failure of such assets to meet
customary eligibility criteria), if any, solely to the assets securitized in the
applicable asset securitization transaction and, if such Asset Securitization
Subsidiary is of the type described in clause (i) of the definition of “Asset
Securitization Subsidiary”, the capital stock of such Asset Securitization
Subsidiary;     (I)   Indebtedness (other than Indebtedness of Asset
Securitization Subsidiaries incurred to finance asset securitization
transactions permitted by this Agreement) consisting of the obligation to
repurchase mortgages and related assets or secured by mortgages and related
assets in connection with Mortgage Warehouse Facilities;     (J)   Indebtedness
of PHH Home Loans, LLC incurred under the PHH Home Loans Intercompany Credit
Agreement, in an aggregate principal amount not to exceed $100,000,000;     (K)
  Indebtedness of any Subsidiary Borrower (as defined in the Revolving Credit
Facility as of the Revolver Fourth Amendment Effective Date) incurred under the
Revolving Credit Facility;     (L)   guarantees by any Subsidiary of PHH Parent
of any senior notes issued by PHH Parent after the Revolver Fourth Amendment
Effective Date; and     (M)   Indebtedness incurred in connection with any
Servicing Advance Facility entered into with Government-Sponsored Enterprises,
in an aggregate principal amount not to exceed $120,000,000.

Notwithstanding the foregoing, PHH Parent and its Subsidiaries shall not incur
or issue after the date hereof any Indebtedness for borrowed money which has
scheduled or mandatory principal maturities prior to March 31, 2013 (other than,
(1) Indebtedness incurred pursuant to 10(a)(xxiii)(C) (provided that such
Indebtedness incurred pursuant to 10(a)(xxiii)(C) is senior Indebtedness), (G),
(H), (I), (J) and (M), (2) in the case of secured Indebtedness, prepayments
required from the sale of the applicable collateral, (3) any other Indebtedness
requiring prepayments in connection with a change of control offer (and any such
change of control shall be incorporated herein and be deemed to be included in
the definition of “Change of Control”) and (4) any renewals, extensions or
modifications of existing Indebtedness permitted pursuant to this 10(a)(xxiii).
     (xxiv) Takeout Commitment. On a timely basis, as required by the Good
Delivery standards, Seller shall deliver to Purchaser all pool information
relating to each Agency Security referred to in a Takeout Commitment that has
been assigned to Purchaser.

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     (xxv) Acquisition of Participation Certificate. Neither Seller nor any
affiliate thereof will acquire at any time any Participation Certificate or any
other economic interest in or obligation with respect to any Mortgage Loan.
     (xxvi) Treatment as Sale. Under GAAP and for federal income tax purposes,
Seller will report each sale of a Participation Certificate to Purchaser as a
sale of the ownership interest in the Mortgage Loans evidenced by the
Participation Certificate. It is understood that, in making an independent
decision to enter into the Transactions contemplated hereby, Seller has obtained
such independent legal, tax, financial, regulatory and accounting advice as it
deems necessary in order to determine the effect of any Transaction on Seller,
including but not limited to the accounting treatment of such Transaction. It is
further understood that Purchaser has not provided, and Seller has not relied on
Purchaser for, any legal, tax, financial, regulatory or accounting advice in
connection with entering into any Transaction. It is further understood that
Purchaser makes no representation or warranty as to the accuracy or
appropriateness of any determination by Seller and its independent legal, tax,
financial, regulatory and accounting advisers with respect to the effect of any
Transaction on Seller.
     (xxvii) Reserved.
     (xxviii) Delivery of Mortgage Loans. Seller shall deliver Mortgage Loans in
sufficient quantity and outstanding principal balance to enable Purchaser to
consummate the sale or swap as contemplated under the related Takeout
Commitment. Should Seller fail to deliver Mortgage Loans in sufficient quantity
and outstanding principal balance, Seller shall indemnify Purchaser for any and
all losses sustained by Purchaser arising out of the related Takeout Commitment.

  (xxix)   MERS. The Seller is a member of MERS in good standing and current in
the payment of all fees and assessments imposed by MERS, and has materially
complied with all rules and procedures of MERS. Seller has listed Purchaser in
“interim funder” field on the MERS System with respect to each Mortgage Loan and
no other Person shall be identified in the field designated “interim funder”.

  (xxx)   No Prepayment. PHH Parent and its Subsidiaries shall not prepay or
redeem any Indebtedness for borrowed money if such prepayment or redemption
would result in a breach of a covenant under the Revolving Credit Facility as of
the Revolver Fourth Amendment Effective Date.

  (xxxi)   Aggregate Principal Balance. The Cut-off Date Principal Balance
respecting the Mortgage Pool shall be at least equal to the Agency Security Face
Amount for the Agency Security designated to be issued.

          Section 11. Term.
          This Agreement shall continue in effect until the Commitment
Termination Date; provided, however, that no termination will affect the
Obligations hereunder as to any Transaction then outstanding. A Transaction
shall be deemed “outstanding” (each, an “Outstanding Transaction”) during the
period commencing on the Purchase Date with respect to

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such Transaction and continuing until the later of (i) the date of the
expiration (or early termination) of the relevant Servicing Period and (as
applicable) the effective transfer of servicing rights to a Designated Servicer
or (ii) the expiration of the time period for the exercise of Purchaser’s rights
and remedies pursuant to subclause (v) of the definition of “Transaction”.
Notwithstanding the foregoing or any other provision of this Agreement, Seller’s
liability for Purchaser’s claims for damages hereunder and liability for
Seller’s indemnities, representations and warranties contained herein shall
survive any termination of this Agreement.
          Section 12. Exclusive Benefit of Parties; Assignment.
          This Agreement is for the exclusive benefit of the parties hereto and
their respective successors and permitted assigns and (except as provided in the
next sentence) shall not be deemed to give any legal or equitable right to any
other person. Seller expressly agrees that Purchaser (or any of its designees)
and any Designated Servicer shall be intended third party beneficiaries under
this Agreement. Except as expressly provided herein, this Agreement may not be
assigned by Seller or duties hereunder delegated without the prior written
consent of Purchaser.
          Section 13. Amendment; Waivers.
          This Agreement may be amended from time to time only by written
agreement of Seller and Purchaser. Any forbearance, failure, or delay by
Purchaser 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.
          Section 14. 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 15. Governing Law; Waiver of Jury Trial.
          This Agreement shall be governed by and construed in accordance with
the laws of the State of New York, which is the place of the making of this
Agreement, without regard to conflict of laws rules. Seller hereby irrevocably
agrees that any action or proceeding against it arising out of or in any manner
relating to this Agreement may be brought in any court of the State of New York,
or in the United States District Court for the Southern District of New York,
and by the execution and delivery of this Agreement and the Custodial Agreement,
Seller expressly and irrevocably assents and submits to the nonexclusive
jurisdiction of any such courts in any such action or proceeding. SELLER AND
PURCHASER HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

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          Section 16. Notices.
          Except as otherwise expressly permitted by this Agreement, all
notices, requests and other communications provided for herein (including
without limitation any modifications of, or waivers, requests or consents under,
this Agreement) shall be given or made in writing (including without limitation
by telecopy or electronic mail) delivered to the intended recipient at the
“Address for Notices” specified below its name on Schedule 1 hereto); or, as to
any party, at such other address as shall be designated by such party in a
written notice to each other party. Except as otherwise provided in this
Agreement all such communications shall be deemed to have been duly given when
transmitted by telecopy, electronic mail or personally delivered or, in the case
of a mailed notice, upon receipt, in each case given or addressed as aforesaid.
In all cases, to the extent that the related individual set forth in the
respective “Attention” line is no longer employed by the respective Person, such
notice may be given to the attention of a Responsible Officer of the respective
Person or to the attention of such individual or individuals as subsequently
notified in writing by a Responsible Officer of the respective Person.
          Section 17. 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. The parties intend that faxed signatures and electronically
imaged signatures such as .pdf files shall constitute original signatures and
are binding on all parties.
          Section 18. Confidentiality.
          (a) Seller and Purchaser each acknowledge and agree that the terms of
this Agreement including, without limitation, the financial terms contained in
the related Participation Certificate are confidential and Seller agrees to keep
confidential all non-public information provided to it by Purchaser or an
Affiliate thereof pursuant to this Agreement or any other Program Document that
is designated by such Person as confidential and such information shall not be
disclosed to any third party without the written consent of Purchaser except for
(i) disclosure to Seller’s direct and indirect Affiliates and Subsidiaries,
employees, directors, agents, attorneys, accountants or other professional
advisors, but only to the extent such disclosure is necessary and such parties
agree to hold all information in strict confidence, (ii) disclosure required by
law, rule, regulation or order of a court or other regulatory body,
(iii) disclosure to the extent necessary to obtain any Takeout Commitment
hereunder, (iv) any disclosures or filing required under Securities and Exchange
Commission (“SEC”) or state securities’ laws or (v) such other circumstances as
are reasonably within the discretion of a public company in order to meet its
corporate obligations; provided that in the case of (iii), (iv) and (v) Seller
shall take reasonable actions to provide Purchaser with prior written notice.
          (b) Purchaser agrees to keep confidential all non-public information
provided to it by Seller or an Affiliate thereof pursuant to this Agreement or
any other Program Document that is designated by such Person as confidential and
such information shall not be disclosed to any third party without the written
consent of Seller except for (i) disclosure in connection with Purchaser’s right
to sell, transfer or otherwise dispose of a Participation Certificate,
(ii) disclosure to Purchaser’s direct and indirect Affiliates and Subsidiaries,
employees, directors,

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agents, attorneys, accountants or other professional advisors, but only to the
extent such disclosure is necessary and such parties agree to hold all
information in strict confidence, (iii) disclosure required by law, rule,
regulation or order of a court or regulatory body, (iv) any disclosures or
filing required under SEC or state securities’ laws; (v) disclosure in
connection with the enforcement of any of the provisions of this Agreement;
(vi) to the extent to such confidential information is in the public domain
other than due to a breach of this Section 18 or (vii) such other circumstances
as are reasonably within the discretion of a public company in order to meet its
corporate obligations; provided that in the case of (iv) and (vii) Purchaser
shall take reasonable actions to provide Seller with prior written notice.
          (c) Notwithstanding anything in this Agreement to the contrary,
Purchaser shall comply with all applicable local, state and federal laws,
including, without limitation, all privacy and data protection law, rules and
regulations that are applicable to the Mortgage Loans and/or any applicable
terms of this Agreement (the “Seller Confidential Information”). Purchaser
understands that the Seller Confidential Information may contain “nonpublic
personal information”, as that term is defined in Section 509(4) of the
Gramm-Leach-Bliley Act (the “Act”), and Purchaser agrees to maintain such
nonpublic personal information that it receives hereunder in accordance with the
Act and other applicable federal and state privacy laws. Purchaser shall
implement such physical and other security measures as shall be necessary to
(i) ensure the security and confidentiality of the “nonpublic personal
information” of the “customers”, “consumers” (as those terms are defined in the
Act) and Mortgagors of Seller or any Affiliate of Seller which Purchaser holds,
(ii) protect against any threats or hazards to the security and integrity of
such nonpublic personal information, and (iii) protect against any unauthorized
access to or use of such nonpublic personal information. Purchaser represents
and warrants that it has implemented appropriate measures to meet the objectives
of Section 501(b) of the Act and of the applicable standards adopted pursuant
thereto, as now or hereafter in effect. Purchaser shall notify Seller timely
following discovery of any breach or compromise of the security,
confidentiality, or integrity of nonpublic personal information of the
customers, consumers and Mortgagors of Seller provided directly to the Purchaser
by Seller. Purchaser shall provide such notice to Seller in accordance with
Section 16 hereof.
          Section 19. Acknowledgments.
          Seller hereby acknowledges that:
          (a) it has been advised by counsel in the negotiation, execution and
delivery of the Agreement and the Custodial Agreement;
          (b) Seller has no fiduciary relationship to Purchaser, and the
relationship between Seller and Purchaser is solely that of seller and
purchaser; and
          (c) no joint venture exists between Seller and Purchaser.
          Section 20. Authorizations. Any of the persons whose signatures and
titles appear on Schedule I are authorized, acting singly, to act for Seller or
Purchaser, as the case may be, under this Agreement.

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          Section 21. Set-Off. If any Servicing Termination Event shall have
occurred and be continuing, Purchaser is hereby authorized at any time and from
time to time, to the fullest extent permitted by Applicable Law, to set off and
apply any and all deposits (general or special, time or demand, provisional or
final) at any time held by Purchaser and any other indebtedness at any time
owing by Purchaser to, or for the credit or the account of, the Seller, against
any of and all the Obligations now or hereafter existing under this Agreement,
irrespective of whether or not Purchaser shall have made any demand under this
Agreement and although such Obligations may be unmatured. Purchaser agrees
promptly to notify the Seller after any such setoff and application made by
Purchaser, but the failure to give such notice shall not affect the validity of
such setoff and application. The rights of Purchaser under this Section 21 are
in addition to other rights and remedies (including other rights of setoff)
which Purchaser may have.
          Section 22. Refund of Program Fee.
          (a) If an event described in Section 8(b)(ix) occurs and Purchaser
shall determine based on such event, whether pursuant to such event being
classified as a condition precedent to a Transaction or otherwise, to no longer
enter into future Transactions, Purchaser shall remit to Seller the pro rata
portion of the Program Fee paid by Seller from such date through the Commitment
Termination Date.
          (b) If an event described in Section 23 occurs and Seller shall
determine, solely based on such event and in its sole discretion, to no longer
enter into future Transactions as a result of such increased costs, Purchaser
shall remit to Seller the pro rata portion of the Program Fee paid by Seller
from such date through the Commitment Termination Date.
          Section 23. Increased Costs.
          If Purchaser determines (a) that any change or development involving a
prospective change in taxation or other Applicable Law or regulation or
interpretation thereof in the United States directly affecting the Participation
Certificates or the consequences of Purchaser owning, or holding a security
interest in, the Participation Certificates; (b) that the imposition of exchange
controls by the United States, that directly affects the Participation
Certificates or the consequences of Purchaser owning, or holding a security
interest in, the Participation Certificates; or (c) that the imposition of
exchange controls by the United States, that directly affects the financial
markets of the United States, in each case made subsequent to the date hereof
(i) subjects Purchaser to any tax of any kind whatsoever (excluding income
taxes, branch profits taxes, franchise taxes or any other tax imposed on the net
income of the Purchaser by the United States, a state or a foreign jurisdiction
under the laws of which Purchaser is organized or of its applicable lending
office, or any political subdivision thereof unless such taxes are imposed
solely as a result of Purchaser having executed, delivered or performed its
obligations or received payments under, or enforced, this Agreement or any of
the other Program Documents) with respect to this Agreement, any Mortgage Loans
or Participation Certificates, or changes the basis or rate of taxation of
payments to Purchaser in respect thereof, (ii) imposes, modifies or holds
applicable any reserve, special deposit, compulsory advance or similar
requirement against assets held by deposits or other liabilities in or for the
account of Transactions or extensions of credit by, or any other acquisition of
funds by any office of

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Purchaser which is not otherwise included in the determination of the Discount
Rate hereunder, or (iii) imposes on Purchaser any other condition, the result of
which is to increase the cost to Purchaser, by an amount which Purchaser deems
to be material, of effecting or maintaining purchases hereunder, or to reduce
any amount receivable hereunder in respect thereof, then, in any such case,
Seller shall promptly pay Purchaser such additional amount or amounts as will
compensate Purchaser for such increased cost or reduced amount receivable
thereafter incurred on an after-tax basis.
          If Purchaser becomes entitled to claim any additional amounts pursuant
to this Section 23, it shall promptly notify Seller of the event by reason of
which it has become so entitled. A certificate as to any additional amounts
payable pursuant to this subsection submitted by Purchaser to Seller shall be
conclusive in the absence of manifest error.
[SIGNATURE PAGE FOLLOWS]

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          IN WITNESS WHEREOF, Purchaser and Seller have duly executed this
Agreement as of the date first above written.

            PHH MORTGAGE CORPORATION, as Seller
      By:           Name:           Title:           JPMORGAN CHASE BANK,
NATIONAL ASSOCIATION
as Purchaser
    By:           Name:           Title:        

 

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SCHEDULE I
SELLER NOTICES

     
Name:
  Mark Johnson
 
   
Address:
  PHH Mortgage Corporation
 
  1 Mortgage Way
 
  Mt. Laurel, New Jersey 08054
 
   
Telephone:
  856-917-0176
 
   
Telecopy:
  856-917-6910
 
   
Email:
  mark.johnson@phhmail.com

with copy to:

     
Name:
  General Counsel
 
   
Address:
  PHH Mortgage Corporation
 
  1 Mortgage Way
 
  Mt. Laurel, New Jersey 08054
 
   
Telephone:
   
 
   
Telecopy:
  856-917-7295
 
   
Email:
  legalnotice@phhmail.com

with copy to:

     
Name:
  E. Lee Smith, Esq.
 
   
Address:
  Sonnenschein Nath & Rosenthal LLP
 
  Two World Financial Center
 
  New York, NY 10281
 
   
Telephone:
  212-768-6938
 
   
Telecopy:
  212-768-6800
 
   
Email:
  elsmith@sonnenschein.com

 

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SELLER AUTHORIZATIONS
Any of the persons whose signatures and titles appear below are authorized,
acting singly, to act for Seller under this Agreement:

          Name   Title   Signature                                              
                                                                               
                                                                               
   

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JPMORGAN CHASE BANK, NATIONAL ASSOCIATION NOTICES

         
Name: Jonathan Davis
  Address:   JPMorgan Chase Bank, National Association
Title: Executive Director
      383 Madison Avenue
Telephone: (212) 834-3850
      8th Floor
Facsimile: (917) 464-4160
      New York, New York 10179
E-mail: jonathan.p.davis@jpmorgan.com
       

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION AUTHORIZATIONS
Any of the persons whose signatures and titles appear below, including any other
authorized officers, are authorized, acting singly, to act for Purchaser under
this Agreement:

          Name   Title   Signature  
Jonathan Davis
  Executive Director    
 
       
Helaine Hebble
  Executive Director    

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EXHIBIT A
TAKEOUT COMMITMENT ASSIGNMENT
Commitment

     
 
  (“Takeout Investor”)

(Address)

         
Attention:
       
 
       

Gentlemen:
You have a commitment (the “Commitment”), to purchase mortgage-backed
pass-through securities (“Securities”) under the following trade terms:

     
Seller:                                                                
  Pool Type:
Trade Date:                                                       
  Settlement Date:
Amount:                                                            
  Purchase Price:
Coupon:                                                            
  Agency:

         
Trade Stipulations (if any):
  —   (a) Government National Mortgage Association
 
  —   (b) Fannie Mae
 
  —   (c) Federal Home Loan Mortgage Corporation

This is to confirm that (i) the Commitment is in full force and effect, (ii) the
Commitment has been assigned to JPMorgan Chase Bank, National Association
(“Purchaser”), whose acceptance of such assignment is indicated below, (iii) you
will accept delivery of such Securities directly from Purchaser and (iv) you
will pay Purchaser for such Securities. Payment will be made “delivery versus
payment (DVP)” to Purchaser in immediately available funds. Purchaser shall have
the right to require you to fulfill your obligation to purchase the Securities.
          Notwithstanding the foregoing, the obligation of Purchaser to deliver
the Securities to you shall arise solely to the extent Purchaser receives such
Securities and to the extent that Purchaser fails to receive such Securities
your sole recourse for the failure of such delivery shall be against Seller.

A-1

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          Please execute this letter in the space provided below and send it by
telecopy immediately to Purchaser at JPMorgan Chase Bank, National Association,
4 New York Plaza, New York, NY 10004-2413 (telephone no. (212) 623-5989;
telecopy no. (646) 224-5578), Attention: Jacqueline McCummings. If you have any
questions, please call Jacqueline McCummings at (212) 623-5989 immediately.

            Very truly yours,

____________________________________, as Seller
      By:           Title:         Date:      

            Agreed to:

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
      By:           Title:          Date:       

A-2

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EXHIBIT B
RESERVED

B-1

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EXHIBIT C
SELLER’S WIRE TRANSFER INSTRUCTIONS
(date)
The Seller’s wire transfer instructions for purposes of all remittances and
payments related to this Agreement are:
[WIRE INSTRUCTIONS]

C-1

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EXHIBIT D
RESERVED

D-1

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EXHIBIT E
SCHEDULE OF INDEBTEDNESS*
PHH Corporation
Amended and Restated Competitive Advance and Revolving Credit Agreement, dated
as of January 6, 2006 as amended through the Fourth Amendment, dated as of
June 25, 2010, among PHH Parent, as Borrower, PHH Vehicle Management Services
Inc., as Canadian Subsidiary Borrower, JPMorgan Chase Bank, N.A., as
Administrative Agent, the lenders from time to time party thereto and others, as
further amended from time to time.
Senior Notes due 2013
Indenture dated as of November 6, 2000 between PHH Corporation and The Bank of
New York Mellon (formerly known as The Bank of New York, as successor in
interest to Bank One Trust Company, N.A.), as Trustee.
Supplemental Indenture No. 1 dated as of November 6, 2000 between PHH
Corporation and The Bank of New York Mellon (formerly known as The Bank of New
York, as successor in interest to Bank One Trust Company, N.A.), as Trustee.
Supplemental Indenture No. 2 dated as of January 30, 2001 between PHH
Corporation and The Bank of New York Mellon (formerly known as The Bank of New
York, as successor in interest to Bank One Trust Company, N.A.), as Trustee.
Supplemental Indenture No. 3 dated as of May 30, 2002 between PHH Corporation
and The Bank of New York Mellon (formerly known as The Bank of New York, as
successor in interest to Bank One Trust Company, N.A.), as Trustee.
Convertible Notes due 2012
Indenture dated as of April 2, 2008, by and between PHH Corporation and The Bank
of New York, as Trustee.
Convertible Notes due 2014
Indenture dated as of September 29, 2009, by and between PHH Corporation and The
Bank of New York Mellon, as Trustee.
Chesapeake Funding, LLC
Amended and Restated Base Indenture dated as of December 17, 2008 among
Chesapeake Finance Holdings LLC, as Issuer, and JP Morgan Chase Bank, N.A., as
Indenture Trustee.
Series 2009-1 Indenture Supplement, dated as of June 9, 2009, among Chesapeake
Funding LLC, as issuer, and The Bank of New York Mellon, as indenture trustee.

E-1

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Series 2009-2 Indenture Supplement, dated as of September 11, 2009, among
Chesapeake Funding LLC, as issuer, and The Bank of New York Mellon, as indenture
trustee.
Series 2009-3 Indenture Supplement, dated as of November 18, 2009, among
Chesapeake Funding LLC, as issuer, and The Bank of New York Mellon, as indenture
trustee.
Series 2009-4 Indenture Supplement, dated as of December 18, 2009, among
Chesapeake Funding LLC, as issuer, and The Bank of New York Mellon, as indenture
trustee.
Series 2010-1 Indenture Supplement dated as of December 17, 2008, among
Chesapeake Funding, LLC as issuer, PHH Vehicles Management Services, LLC, a
wholly-owned subsidiary of the Company, as administrator, JPMorgan Chase Bank
N.A. as administrative agent, certain non-conduit purchasers, certain CP conduit
purchaser groups, funding agents for the CP conduit purchaser groups and certain
Class B Note Purchasers
PHH Mortgage Corporation
Second Amended and Restated Master Repurchase Agreement, dated as of June 25,
2010, between PHH Mortgage Corporation, as seller, and The Royal Bank of
Scotland plc, as buyer and agent
Master Repurchase Agreement, dated May 26, 2010, by and among PHH Mortgage
Corporation, as seller, PHH Corporation, as guarantor, and Credit Suisse First
Boston Mortgage Capital, LLC, as buyer
Letter Agreement dated February 9, 2010 constituting Amendment No. 7 of the
Master Agreement and Contract (No. MP04311) between PHH Mortgage Corporation and
Fannie Mae (“Service Advance Early Reimbursement Mechanics”)
Sooner Than Pooled Agreement dated March 12, 2009 between PHH Mortgage
Corporation and Fannie Mae
As Soon As Pooled Plus Agreement dated January 8, 2008 between PHH Mortgage
Corporation and Fannie Mae
Second Amendment dated May 30, 2010 to the Credit Agreement dated December 17,
2008 between PHH Mortgage Corporation and Manufacturers and Traders Trust
Company as amended
 

*   As of the Revolver Fourth Amendment Effective Date, the Material
Subsidiaries of PHH Parent are: PHH Mortgage Corporation, Atrium Insurance
Corporation, D. L. Peterson Trust, Chesapeake Funding, LLC, Chesapeake Finance
Holdings, LLC, and PHH Vehicle Management Services, LLC (d/b/a PHH Arval).

E-2

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EXHIBIT F
Seller’s Officer’s Certificate
          I, ___________________, do hereby certify that I am duly elected,
qualified and authorized officer of PHH Mortgage Corporation (“Seller”). This
Certificate is delivered to you in connection with Section 10(a)(v) of the
Mortgage Participation Sale Agreement dated as of September 2, 2010, among
Seller and JPMorgan Chase Bank, N.A. (the “Agreement”). I hereby certify that,
as of the date of the financial statements attached hereto and as of the date
hereof, Seller is and has been in compliance with all the terms of the Agreement
and, without limiting the generality of the foregoing, I certify that:
          (i) Minimum Consolidated Net Worth. PHH Parent has had a Consolidated
Net Worth on the last day of any fiscal quarter ended after the Revolver Fourth
Amendment Effective Date of at least $1,000,000,000.
          (ii) Maximum Leverage Ratio. PHH Parent and its Subsidiaries have
maintained a ratio of Indebtedness to Tangible Net Worth of no greater than 6.5
to 1.0.
          (iii) Available Financing. PHH Parent and its Subsidiaries have
maintained, at all times, an aggregate Available Borrowing Capacity of at least
$1,000,000,000 (excluding uncommitted warehouse capacity provided by
Government-Sponsored Enterprises), provided that no more than $500,000,000 of
such capacity is in respect of facilities that are exclusively gestation
facilities.

F-1

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IN WITNESS WHEREOF, I have set my hand this _____ day of ________, ________.

                  By:           Name:           Title:        

F-2

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[Schedule 1]
[to Officer’s Certificate]

F-3

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EXHIBIT G
PERMITTED AFFILIATE AGREEMENTS
     • Strategic Relationship Agreement, dated as of January 31, 2005, by and
among Cendant Real Estate Services Group, LLC, Cendant Real Estate Services
Venture Partner, Inc., PHH Corporation, PHH Mortgage Corporation, PHH Broker
Partner Corporation, and PHH Home Loans, LLC
     • Management Services Agreement, dated as of March 31, 2006, by and among
PHH Home Loans, LLC, PHH Mortgage Corporation and others
     • Flow Servicing Agreement, dated as of May 1, 2010, among certain
Subsidiaries of PHH Mortgage Corporation, as owners, and PHH Mortgage
Corporation, as servicer.
     • Sublease, dated as of June 1, 2005, between PHH Mortgage Corporation and
PHH Home Loans, LLC
     • Loan Purchase and Sale Agreement, dated October 1, 2005, between PHH
Mortgage Corporation and PHH Home Loans, LLC
     • Correspondent Agreements between PHH Mortgage Corporation and certain of
its Subsidiaries
     • Indemnity Agreement, dated as of May 18, 2009, between PHH Mortgage
Corporation and PHH Home Loans, LLC

G-1