Exhibit 10.9
Execution Version
 
FLOW MORTGAGE LOAN SALE AND SERVICING AGREEMENT
between
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Seller and as Servicer,
and
RWT HOLDINGS, INC.,
as Purchaser
July 1, 2006
Residential Mortgage Loans
 

 

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TABLE OF CONTENTS

              Page  
SECTION 1. Definitions
    1  
SECTION 2. Purchase and Conveyance
    15  
SECTION 3. Mortgage Loan Schedule
    16  
SECTION 4. Purchase Price
    16  
SECTION 5. Examination of Mortgage Files
    16  
SECTION 6. Delivery of Mortgage Loan Documents
    17  
Subsection 6.01 Possession of Mortgage Files
    17  
Subsection 6.02 Books and Records
    17  
Subsection 6.03 Delivery of Mortgage Loan Documents
    18  
SECTION 7. Representations, Warranties and Covenants; Remedies for Breach
    18  
Subsection 7.01 Representations and Warranties Regarding Individual Mortgage
Loans
    18  
Subsection 7.02 Seller and Servicer Representations
    29  
Subsection 7.03 Repurchase; Substitution
    31  
Subsection 7.04 Repurchase of Mortgage Loans With Early Payment Default
    32  
Subsection 7.05 Purchase Price Protection
    33  
SECTION 8. Closing
    33  
Subsection 8.01 Closing Conditions
    33  
Subsection 8.02 Closing Documents
    34  
SECTION 9. [Reserved.]
    34  
SECTION 10. Costs
    34  
SECTION 11. Administration and Servicing of Mortgage Loans
    34  
Subsection 11.01 Servicer to Act as Servicer; Subservicing
    34  
Subsection 11.02 Liquidation of Mortgage Loans
    37  
Subsection 11.03 Collection of Mortgage Loan Payments
    37  
Subsection 11.04 Establishment of Custodial Account; Deposits in Custodial
Account
    37  
Subsection 11.05 Withdrawals From the Custodial Account
    39  
Subsection 11.06 Establishment of Escrow Account; Deposits in Escrow Account
    40  
Subsection 11.07 Withdrawals From Escrow Account
    41  
Subsection 11.08 Payment of Taxes, Insurance and Other Charges; Collections
Thereunder
    41  
Subsection 11.09 Transfer of Accounts
    42  
Subsection 11.10 Maintenance of Hazard Insurance
    42  
Subsection 11.11 Maintenance of Primary Mortgage Insurance Policy; Claims
    43  
Subsection 11.12 Fidelity Bond; Errors and Omissions Insurance
    43  
Subsection 11.13 Title, Management and Disposition of REO Property
    44  
Subsection 11.14 Servicing Compensation
    45  
Subsection 11.15 Distributions
    45  
Subsection 11.16 Statements to the Purchaser
    45  
Subsection 11.17 Advances by the Servicer
    46  
Subsection 11.18 Assumption Agreements
    47  
Subsection 11.19 Satisfaction of Mortgages and Release of Mortgage Files
    47  
Subsection 11.20 Servicer Shall Provide Access and Information as Reasonably
Required
    48  
Subsection 11.21 Inspections
    48  
Subsection 11.22 Restoration of Mortgaged Property
    48  
Subsection 11.23 Fair Credit Reporting Act
    49  

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              Page  
SECTION 12. The Servicer
    49  
Subsection 12.01 Indemnification; Third Party Claims
    49  
Subsection 12.02 Merger or Consolidation of the Servicer
    49  
Subsection 12.03 Limitation on Liability of the Servicer and Others
    50  
Subsection 12.04 Seller and Servicer Not to Resign
    50  
Subsection 12.05 Liability for Failure to Deliver Servicing Files
    50  
SECTION 13. Default
    50  
Subsection 13.01 Events of Default
    50  
Subsection 13.02 Waiver of Default
    52  
SECTION 14. Termination
    52  
Subsection 14.01 Termination
    52  
Subsection 14.02 Successors to the Servicer
    52  
SECTION 15. Notices
    53  
SECTION 16. Severability Clause
    54  
SECTION 17. No Partnership
    54  
SECTION 18. Counterparts
    54  
SECTION 19. Governing Law
    55  
SECTION 20. Intention of the Parties
    55  
SECTION 21. Waivers
    55  
SECTION 22. Exhibits
    55  
SECTION 23. General Interpretive Principles
    55  
SECTION 24. Reproduction of Documents
    56  
SECTION 25. Amendment
    56  
SECTION 26. Confidentiality
    56  
SECTION 27. Entire Agreement
    57  
SECTION 28. Further Agreements
    57  
SECTION 29. Successors and Assigns
    57  
SECTION 30. Non-Solicitation
    58  
SECTION 31. Protection of Consumer Information
    59  
SECTION 32. Cooperation of the Company with a Reconstitution; Regulation AB
Compliance
    59  

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EXHIBITS

     
EXHIBIT 1
  MORTGAGE LOAN DOCUMENTS
 
   
EXHIBIT 2
  CONTENTS OF EACH MORTGAGE FILE
 
   
EXHIBIT 3
  UNDERWRITING GUIDELINES
 
   
EXHIBIT 4
  [RESERVED]
 
   
EXHIBIT 5
  FORM OF MONTHLY REMITTANCE REPORT
 
   
EXHIBIT 6
  FORM OF TERM SHEET
 
   
ADDENDUM I
  REGULATION AB COMPLIANCE ADDENDUM

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FLOW MORTGAGE LOAN SALE AND SERVICING AGREEMENT
     THIS FLOW MORTGAGE LOAN SALE AND SERVICING AGREEMENT (the “Agreement”),
dated July 1, 2006, is hereby executed by and between RWT HOLDINGS, INC., a
Delaware corporation, as purchaser (the “Purchaser”), and BANK OF AMERICA,
NATIONAL ASSOCIATION, a national banking association, as seller (the “Seller”)
and as servicer (the “Servicer”).
WITNESSETH:
     WHEREAS, the Seller has agreed to sell from time to time to the Purchaser,
and the Purchaser has agreed to purchase from time to time from the Seller,
certain conventional, residential, first-lien mortgage loans (the “Mortgage
Loans”) as described herein on a servicing-retained basis, and which shall be
delivered as whole loans as provided herein; and
     WHEREAS, the Mortgage Loans will be sold by the Seller and purchased by the
Purchaser as pools or groups of whole loans, servicing retained (each, a
“Mortgage Loan Package”) on the various Closing Dates as provided herein; and
     WHEREAS, each of the Mortgage Loans will be secured by a mortgage, deed of
trust or other security instrument creating a first lien on a residential
dwelling located in the jurisdiction indicated on the related Mortgage Loan
Schedule which will be annexed to a Term Sheet (as defined herein) on the
related Closing Date; and
     WHEREAS, the Purchaser, the Seller and the Servicer wish to prescribe the
manner of the conveyance, servicing and control of the Mortgage Loans;
     NOW, THEREFORE, in consideration of the premises and mutual agreements set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser, the Seller and the
Servicer agree as follows:
     SECTION 1. Definitions.
     For purposes of this Agreement, the following capitalized terms shall have
the respective meanings set forth below.
     Adjustable Rate Mortgage Loan: A Mortgage Loan purchased pursuant to this
Agreement which provides for the adjustment of the Mortgage Interest Rate
payable in respect thereto.
     Adjustment Date: As to each Adjustable Rate Mortgage Loan, the date on
which the Mortgage Interest Rate is adjusted in accordance with the terms of the
related Mortgage Note and Mortgage.
     Agency Transfer: As defined in Section 32 of this Agreement.
     Agreement: This Flow Mortgage Loan Sale and Servicing Agreement including
all exhibits, schedules, amendments and supplements hereto.

 

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     ALTA: The American Land Title Association or any successor thereto.
     Appraised Value: With respect to any Mortgaged Property, the lesser of
(i) the value thereof as determined by a Qualified Appraiser at the time of
origination of the Mortgage Loan, and (ii) the purchase price paid for the
related Mortgaged Property by the Mortgagor with the proceeds of the Mortgage
Loan; provided, however, that in the case of a Refinanced Mortgage Loan, such
value of the Mortgaged Property is based solely upon the value determined by an
appraisal made for the originator of such Refinanced Mortgage Loan at the time
of origination of such Refinanced Mortgage Loan by a Qualified Appraiser.
     Assignment of Mortgage: An individual assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form, sufficient under the laws
of the jurisdiction in which the related Mortgaged Property is located to give
record notice of the sale of the Mortgage to the Purchaser.
     Assumed Principal Balance: As to each Mortgage Loan as of any date of
determination, (i) the principal balance of the Mortgage Loan outstanding as of
the Cut-off Date after application of payments due on or before the Cut-off
Date, whether or not received, minus (ii) all amounts previously distributed to
the Purchaser with respect to the Mortgage Loan pursuant to Subsection 11.15 and
representing (a) payments or other recoveries of principal or (b) advances of
scheduled principal payments made pursuant to Subsection 11.17.
     Balloon Mortgage Loan: A Mortgage Loan that provided on the date of
origination for monthly payments up to but not including the maturity date based
on an amortization extending beyond its maturity date.
     Balloon Payment: With respect to any Balloon Mortgage Loan as of any date
of determination, the final payment payable on the maturity of such Mortgage
Loan, which shall include the entire remaining principal balance.
     Business Day: Any day other than (i) a Saturday or a Sunday, or (ii) a
legal holiday in the State of New York or the State of California, or (iii) a
day on which banks in the State of New York or the State of California are
authorized or obligated by law or executive order to be closed.
     Closing Date: The date or dates, set forth in the related Term Sheet, on
which the Purchaser will purchase and the Seller will sell the Mortgage Loans
identified therein.
     CLTA: The California Land Title Association or any other successor thereto.
     Code: The Internal Revenue Code of 1986, as amended, or any successor
statute thereto.
     Commission: The United States Securities and Exchange Commission.
     Condemnation Proceeds: All awards, compensation and settlements in respect
of a taking (whether permanent or temporary) of all or part of a Mortgaged
Property by exercise of the power of condemnation or the right of eminent
domain, to the extent not required to be released to a Mortgagor in accordance
with the terms of the related Mortgage Loan Documents.

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     Consumer Information: Any personally identifiable information in any form
(written electronic or otherwise) relating to a Mortgagor, including, but not
limited to: a Mortgagor’s name, address, telephone number, Mortgage Loan number,
Mortgage Loan payment history, delinquency status, insurance carrier or payment
information, tax amount or payment information; the fact that the Mortgagor has
a relationship with the Company or the originator of the related Mortgage Loan;
and any other non-public personally identifiable information.
     Convertible Mortgage Loan: An Adjustable Rate Mortgage Loan that by its
terms and subject to certain conditions allows the Mortgagor to convert the
adjustable Mortgage Interest Rate thereon to a fixed Mortgage Interest Rate.
     Cooperative Corporation: With respect to any Cooperative Loan, the
cooperative apartment corporation that holds legal title to the related
Cooperative Project and grants occupancy rights to units therein to stockholders
through Cooperative Leases or similar arrangements.
     Cooperative Lease: The lease on a Cooperative Unit evidencing the
possessory interest of the owner of the Cooperative Shares in such Cooperative
Unit.
     Cooperative Loan: A Mortgage Loan that is secured by a first lien on and
perfected security interest in Cooperative Shares and the related Cooperative
Lease granting exclusive rights to occupy the related Cooperative Unit in the
building owned by the related Cooperative Corporation.
     Cooperative Project: With respect to any Cooperative Loan, all real
property and improvements thereto and rights therein and thereto owned by a
Cooperative Corporation including without limitation the land, separate dwelling
units and all common elements.
     Cooperative Shares: With respect to any Cooperative Loan, the shares of
stock issued by a Cooperative Corporation and allocated to a Cooperative Unit
and represented by a stock certificate.
     Cooperative Unit: With respect to a Cooperative Loan, a specific unit in a
Cooperative Project.
     Credit Score: The credit score for each Mortgage Loan shall be the minimum
of two credit bureau scores obtained at origination or such other time by the
Seller. If two credit bureau scores are obtained, the Credit Score will be the
lower score. If three credit bureau scores are obtained, the Credit Score will
be the middle of the three. When there is more than one applicant, the lowest of
the applicants’ Credit Scores will be used. There is only one (1) score for any
loan regardless of the number of borrowers and/or applicants. The minimum Credit
Score for each Mortgage Loan will be in accordance with the Seller’s
Underwriting Standards (as defined below).
     Custodial Account: As defined in Subsection 11.04.
     Customary Servicing Procedures: With respect to any Mortgage Loan, those
mortgage servicing practices (including collection procedures) of prudent
mortgage banking institutions

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which service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located, and which are in
accordance with Fannie Mae servicing practices and procedures, for MBS pool
mortgages, as defined in the Fannie Mae Guides including future updates.
     Cut-off Date: With respect to each Mortgage Loan, the first day of the
month of the related Closing Date as set forth in the related Term Sheet.
     Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced with a
Substitute Mortgage Loan in accordance with this Agreement.
     Determination Date: With respect to each Remittance Date, the 15th day (or,
if such 15th day is not a Business Day, the following Business Day) of the month
in which such Remittance Date occurs.
     Due Date: The day of the month on which the Monthly Payment is due on a
Mortgage Loan, exclusive of any days of grace.
     Due Period: With respect to each Remittance Date, the period beginning on
the second day of the month preceding the month of the Remittance Date, and
ending on the first day of the month of the Remittance Date.
     Eligible Investments: Any one or more of the following obligations or
securities:
     (i) direct obligations of, and obligations fully guaranteed by the United
States of America or any agency or instrumentality of the United States of
America the obligations of which are backed by the full faith and credit of the
United States of America;
     (ii) (a) demand or time deposits, federal funds or bankers’ acceptances
issued by any depository institution or trust company incorporated under the
laws of the United States of America or any state thereof and subject to
supervision and examination by federal and/or state banking authorities,
provided that the commercial paper and/or the short-term deposit rating and/or
the long-term unsecured debt obligations or deposits of such depository
institution or trust company at the time of such investment or contractual
commitment providing for such investment are rated in one of the two highest
rating categories by each Rating Agency and (b) any other demand or time deposit
or certificate of deposit that is fully insured by the FDIC;
     (iii) repurchase obligations with a term not to exceed thirty (30) days and
with respect to (a) any security described in clause (i) above and entered into
with a depository institution or trust company (acting as principal) described
in clause (ii)(a) above;
     (iv) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States of America or any
state thereof that are rated in one of the two highest rating categories by each
Rating Agency at the time of such investment or contractual commitment providing
for such investment; provided, however, that securities issued by any particular
corporation will not be Eligible Investments to the

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extent that investments therein will cause the then outstanding principal amount
of securities issued by such corporation and held as Eligible Investments to
exceed 10% of the aggregate outstanding principal balances of all of the
Mortgage Loans and Eligible Investments;
     (v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a specified
date not more than one year after the date of issuance thereof) which are rated
in one of the two highest rating categories by each Rating Agency at the time of
such investment;
     (vi) any other demand, money market or time deposit, obligation, security
or investment as may be acceptable to each Rating Agency as evidenced in writing
by each Rating Agency; and
     (vii) any money market funds the collateral of which consists of
obligations fully guaranteed by the United States of America or any agency or
instrumentality of the United States of America the obligations of which are
backed by the full faith and credit of the United States of America (which may
include repurchase obligations secured by collateral described in clause (i))
and other securities and which money market funds are rated in one of the two
highest rating categories by each Rating Agency.
     provided, however, that no instrument or security shall be an Eligible
Investment if such instrument or security evidences a right to receive only
interest payments with respect to the obligations underlying such instrument or
if such security provides for payment of both principal and interest with a
yield to maturity in excess of 120% of the yield to maturity at par or if such
investment or security is purchased at a price greater than par.
     Escrow Account: As defined in Subsection 11.06.
     Escrow Payments: The amounts constituting ground rents, taxes, assessments,
Primary Mortgage Insurance Policy premiums, fire and hazard insurance premiums,
flood insurance premiums, condominium charges and other payments as may be
required to be escrowed by the Mortgagor with the Mortgagee pursuant to the
terms of any Mortgage Note or Mortgage.
     Event of Default: Any one of the conditions or circumstances enumerated in
Subsection 13.01.
     Fannie Mae: The entity formerly known as the Federal National Mortgage
Association or any successor thereto.
     Fannie Mae Guides: The Fannie Mae Sellers’ Guide and the Fannie Mae
Servicers’ Guide and all amendments or additions thereto in effect on and after
the related Closing Date.
     FDIC: The Federal Deposit Insurance Corporation or any successor thereto.
     Fidelity Bond: The fidelity bond required to be obtained by the Servicer
pursuant to Subsection 11.12.

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     FIRREA: The Financial Institutions Reform, Recovery, and Enforcement Act of
1989, as amended and in effect from time to time.
     First Remittance Date: With respect to each Mortgage Loan Package, the 18th
day (or if such 18th day is not a Business Day, the first Business Day
immediately preceding such 18th day) of the calendar month immediately following
the Closing Date; provided, however, if the Transfer Date is not one (1) or more
Business Days prior to the first day of such calendar month, such date will be
the 18th day (or if such 18th day is not a Business Day, the first Business Day
immediately preceding such 18th day) of the next succeeding calendar month.
     Freddie Mac: The entity formerly known as the Federal Home Loan Mortgage
Corporation or any successor thereto.
     Freddie Mac Guide: The Freddie Mac Single Family Seller/Servicer Guide and
all amendments or additions thereto in effect on and after the related Closing
Date.
     Full Prepayment: Any payment of the entire principal balance of a Mortgage
Loan which is received in advance of its scheduled Due Date and is not
accompanied by an amount of interest representing scheduled interest due on any
date or dates in any month or months subsequent to the month of prepayment.
     GAAP: Generally accepted accounting principles consistently applied.
     Gross Margin: With respect to any Adjustable Rate Mortgage Loan, the fixed
percentage amount set forth in the related Mortgage Note and the Mortgage Loan
Schedule that is added to the Index on each Adjustment Date in accordance with
the terms of the related Mortgage Note to determine the new Mortgage Interest
Rate for such Mortgage Loan.
     HUD: The United States Department of Housing and Urban Development or any
successor thereto.
     Index: With respect to any Adjustable Rate Mortgage Loan, the index
identified on the Mortgage Loan Schedule and set forth in the related Mortgage
Note for the purpose of calculating the Mortgage Interest Rate thereon.
     Initial Rate Cap: With respect to each Adjustable Rate Mortgage Loan and
the initial Adjustment Date therefor, a number of percentage points per annum
that is set forth in the Mortgage Loan Schedule and in the related Mortgage
Note, which is the maximum amount by which the Mortgage Interest Rate for such
Adjustable Rate Mortgage Loan may increase or decrease from the Mortgage
Interest Rate in effect immediately prior to such Adjustment Date.
     Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
     IO Adjustable Rate Mortgage Loan: An Adjustable Rate Mortgage Loan with
respect to which accrued interest only is payable by a Mortgagor on each Due
Date until the IO Conversion Date.

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     IO Conversion Date: With respect to an IO Adjustable Rate Mortgage Loan,
the date that references the end of the “interest only period” applicable
thereto.
     Lifetime Rate Cap: As to each Adjustable Rate Mortgage Loan, the maximum
Mortgage Interest Rate which shall be as permitted in accordance with the
provisions of the related Mortgage Note.
     Liquidation Proceeds: The proceeds received in connection with the
liquidation of a defaulted Mortgage Loan through trustee’s sale, foreclosure
sale or otherwise, other than amounts received following the acquisition of REO
Property, Insurance Proceeds and Condemnation Proceeds.
     Loan-to-Value Ratio: With respect to any Mortgage Loan as of any date of
determination, the ratio, expressed as a percentage, on such date of the
outstanding principal balance of the Mortgage Loan, to the Appraised Value of
the related Mortgaged Property.
     LTV: Loan-to-Value Ratio.
     Master Servicer: With respect to any Securitization Transaction, the
“master servicer,” if any, identified in the related transaction documents.
     MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.
     MERS Mortgage Loan: Any Mortgage Loan registered with MERS on the MERS
System.
     MERS System: The system of recording transfers of mortgages electronically
maintained by MERS.
     MIN: The Mortgage Identification Number for any MERS Mortgage Loan.
     Minimum Interest Rate: With respect to each Adjustable Rate Mortgage Loan,
a rate that is set forth on the Mortgage Loan Schedule and in the related
Mortgage Note and is the minimum interest rate to which the Mortgage Interest
Rate on such Mortgage Loan may be decreased.
     Monthly Payment: The scheduled monthly payment on a Mortgage Loan due on
any Due Date allocable to principal and/or interest on such Mortgage Loan
pursuant to the terms of the related Mortgage Note.
     Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note which creates a first lien on an unsubordinated estate in fee
simple in real property securing the Mortgage Note; except that with respect to
real property located in jurisdictions in which the use of leasehold estates for
residential properties is a widely-accepted practice, the mortgage, deed of
trust or other instrument securing the Mortgage Note may secure and create a
first lien upon a leasehold estate of the Mortgagor.

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     Mortgage File: With respect to each Mortgage Loan, the documents pertaining
thereto specified in Exhibit 2 to be provided and any additional documents
required to be added to the Mortgage File pursuant to this Agreement.
     Mortgage Interest Rate: With respect to each Mortgage Loan, the annual rate
at which interest accrues on such Mortgage Loan from time to time in accordance
with the provisions of the related Mortgage Note, including, but not limited to,
the limitations on such interest rate imposed by the Initial Rate Cap, the
Periodic Rate Cap, the Minimum Interest Rate and the Lifetime Rate Cap, if any.
     Mortgage Loan: An individual Mortgage Loan which is the subject of this
Agreement, each Mortgage Loan originally sold and subject to this Agreement
being identified on the related Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Servicing File, the Monthly
Payments, Principal Prepayments, Liquidation Proceeds, Condemnation Proceeds,
Insurance Proceeds, REO Disposition Proceeds, any escrow accounts related to the
Mortgage Loan and all other rights, benefits, proceeds and obligations arising
from or in connection with such Mortgage Loan, excluding replaced or repurchased
mortgage loans.
     Mortgage Loan Documents: With respect to any Mortgage Loan, the documents
listed in Exhibit 1 hereto.
     Mortgage Loan Package: The pool or group of whole loans purchased on a
Closing Date, as described in the Mortgage Loan Schedule annexed to the related
Term Sheet.
     Mortgage Loan Remittance Rate: With respect to any Mortgage Loan, the
annual rate of interest payable to the Purchaser, which shall be equal to the
related Mortgage Interest Rate minus the related Servicing Fee Rate.
     Mortgage Loan Schedule: The schedule of Mortgage Loans prepared for each
Closing Date, such schedule setting forth the following information with respect
to each Mortgage Loan:
          (1) the Company’s Mortgage Loan identifying number;
          (2) the Mortgagor’s name;
          (3) the street address of the Mortgaged Property including the city,
state and zip code;
          (4) a code indicating whether the Mortgaged Property is
owner-occupied, a second home or an investor property;
          (5) the type of residential property constituting the Mortgaged
Property;
          (6) the original months to maturity or the remaining months to
maturity from the Cut-off Date, in any case based on the original amortization
schedule and, if different, the maturity expressed in the same manner but based
on the actual amortization schedule;
          (7) the Appraised Value (including the purchase price of the Mortgaged
Property, if applicable) and Loan-to-Value Ratio at origination;

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          (8) the Mortgage Interest Rate at origination and as of the Cut-off
Date;
          (9) the Mortgage Loan origination date;
          (10) the actual interest paid through date;
          (11) the scheduled interest paid through date;
          (12) the stated maturity date of the Mortgage Loan;
          (13) the amount of the Monthly Payment at origination and as of the
Cut-off Date;
          (14) the original principal amount of the Mortgage Loan;
          (15) the Stated Principal Balance of the Mortgage Loan as of the
Cut-off Date;
          (16) a code indicating the purpose of the Mortgage Loan (i.e.,
purchase, rate and term refinance, equity take-out refinance);
          (17) a code indicating the documentation style (i.e. full, alternative
or reduced);
          (18) the number of times during the twelve (12) month period preceding
the Closing Date that any Monthly Payment has been received thirty (30) or more
days after its Due Date;
          (19) the date on which the first Monthly Payment is due subsequent to
the origination date;
          (20) a code indicating whether or not the Mortgage Loan is insured as
to payment defaults by a Primary Mortgage Insurance Policy; and, in the case of
any Mortgage Loan which is insured as to payment defaults by a Primary Mortgage
Insurance Policy, the name of the provider of such Primary Mortgage Insurance
Policy;
          (21) a code indicating whether or not the Mortgage Loan is the subject
of a Prepayment Penalty as well as the terms of the Prepayment Penalty;
          (22) the Primary Mortgage Insurance Policy Certificate Number, if
applicable;
          (23) the Primary Mortgage Insurance Policy Coverage Percentage, if
applicable;
          (24) a code indicating the Credit Score of the Mortgagor at the time
of origination of the Mortgage Loan;
          (25) a code indicating the credit grade and specific loan/underwriting
program of each Mortgage Loan as assigned by the Company pursuant to the
Underwriting Standards;

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          (26) with respect to each Adjustable Rate Mortgage Loan, the first
Adjustment Date and the Adjustment Date frequency;
          (27) with respect to each Adjustable Rate Mortgage Loan, the Gross
Margin;
          (28) with respect to each Adjustable Rate Mortgage Loan, the Lifetime
Rate Cap under the terms of the Mortgage Note;
          (29) with respect to each Adjustable Rate Mortgage Loan, the Minimum
Mortgage Interest Rate under the terms of the Mortgage Note;
          (30) with respect to each Adjustable Rate Mortgage Loan, the Initial
Rate Cap and Periodic Rate Cap;
          (31) with respect to each Adjustable Rate Mortgage Loan, the first
Adjustment Date immediately following origination and the Cut-off Date;
          (32) with respect to each Adjustable Rate Mortgage Loan, the Index;
          (33) with respect to each Adjustable Rate Mortgage Loan, a code
indicating whether the Mortgage Loan is a Convertible Mortgage Loan;
          (34) the loan type (i.e. fixed, adjustable; 2/28, 3/27, 5/25, etc.);
          (35) a code indicating whether the Mortgage Loan is a MERS Mortgage
Loan and, if so, the corresponding MIN;
          (36) a code indicating if the Mortgage Loan is subject to a
transferable life-of-loan real estate tax service contract; and
          (37) a code indicating if the Mortgage Loan is subject to a fully
transferable life-of-loan flood certification and contract with First American
Flood Data Services.
     With respect to the Mortgage Loans in the aggregate being acquired on a
Closing Date, the Mortgage Loan Schedule shall set forth the following
information, as of the Cut-off Date unless otherwise specified:
          (1) the number of Mortgage Loans;
          (2) the current aggregate outstanding principal balance of the
Mortgage Loans;
          (3) the weighted average Mortgage Interest Rate of the Mortgage Loans;
          (4) the weighted average original months to maturity of the Mortgage
Loans and the weighted average remaining months to maturity of the Mortgage
Loans.

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     Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage or, in the case of a Cooperative Loan, secured
by the Cooperative Shares and the Cooperative Lease.
     Mortgaged Property: The Mortgagor’s real property securing repayment of a
related Mortgage Note, consisting of a fee simple interest in a single parcel of
real property improved by a Residential Dwelling.
     Mortgagee: The mortgagee or beneficiary named in the Mortgage and the
successors and assigns of such mortgagee or beneficiary.
     Mortgagor: The obligor on a Mortgage Note, who is an owner of the Mortgaged
Property and the grantor or mortgagor named in the Mortgage and such grantor’s
or mortgagor’s successors in title to the Mortgaged Property.
     NAIC: The National Association of Insurance Commissioners or any successor
organization.
     Officer’s Certificate: A certificate signed by the Chairman of the Board,
the Vice Chairman of the Board, a President or a Vice President of the Person on
behalf of whom such certificate is being delivered.
     Opinion of Counsel: A written opinion of counsel, who may be salaried
counsel for the Person on behalf of whom the opinion is being given, reasonably
acceptable to each Person to whom such opinion is addressed.
     OTS: The Office of Thrift Supervision or any successor.
     P&I Advance: As defined in Subsection 11.17.
     Partial Prepayment: Any payment of principal on a Mortgage Loan, other than
a Full Prepayment, which is received in advance of its scheduled Due Date and is
not accompanied by an amount of interest representing scheduled interest due on
any date or dates in any month or months subsequent to the month of prepayment.
     Periodic Rate Cap: As to each Adjustable Rate Mortgage Loan, the maximum
increase or decrease in the Mortgage Interest Rate, on any Adjustment Date as
provided in the related Mortgage Note, if applicable.
     Person: An individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
     Pledge Agreement: The specific agreement creating a first lien on and
pledge of the Cooperative Shares and the related Cooperative Lease securing a
Cooperative Loan.
     Prepayment Penalty: With respect to each Mortgage Loan, the penalty if the
Mortgagor prepays such Mortgage Loan as provided in the related Mortgage Note or
Mortgage.

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     Prepayment Interest Shortfall: As to any Remittance Date and any Mortgage
Loan, (a) if such Mortgage Loan was the subject of a Full Prepayment during the
related Principal Prepayment Period, the excess of one month’s interest
(adjusted to the Mortgage Loan Remittance Rate) on the Assumed Principal Balance
of such Mortgage Loan outstanding immediately prior to such prepayment, over the
amount of interest (adjusted to the Mortgage Loan Remittance Rate) actually paid
by the Mortgagor in respect of such Principal Prepayment Period, and (b) if such
Mortgage Loan was the subject of a Partial Prepayment during the related
Principal Prepayment Period, an amount equal to the excess of one month’s
interest at the Mortgage Loan Remittance Rate on the amount of such Partial
Prepayment, over the amount of interest actually paid by the Mortgagor in
respect of such Partial Prepayment during such Principal Prepayment Period.
     Primary Mortgage Insurance Policy: A policy of primary mortgage guaranty
insurance issued by a Qualified Insurer.
     Principal Prepayment: Any full or partial payment or other recovery of
principal on a Mortgage Loan which is received in advance of its scheduled Due
Date, including any Prepayment Penalty or premium thereon and which is not
accompanied by an amount of interest representing scheduled interest due on any
date or dates in any month or months subsequent to the month of prepayment.
     Principal Prepayment Period: As to any Remittance Date, the calendar month
preceding the calendar month in which such Remittance Date occurs.
     Purchase Price: The price paid on the related Closing Date by the Purchaser
to the Seller pursuant to this Agreement in exchange for the Mortgage Loans
included in the related Mortgage Loan Package, as calculated pursuant to
Section 4 and the related Term Sheet.
     Purchase Price Percentage: For each Mortgage Loan included in a Mortgage
Loan Package, the percentage of par set forth in the related Term Sheet that is
used to calculate the Purchase Price of the Mortgage Loans included in such
Mortgage Loan Package.
     Purchaser: The Person listed as such in the initial paragraph of this
Agreement, together with its successors and assigns as permitted under the terms
of this Agreement.
     Qualified Appraiser: With respect to each Mortgage Loan, an appraiser, duly
appointed by the originator, who had no interest, direct or indirect in the
Mortgaged Property or in any loan made on the security thereof, and whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan, and such appraiser and the appraisal made by such appraiser both satisfy
the requirements of Fannie Mae or Freddie Mac and Title XI of FIRREA and the
regulations promulgated thereunder, all as in effect on the date the Mortgage
Loan was originated.
     Qualified Insurer: An insurance company duly qualified as such under the
laws of the states in which the Mortgaged Properties are located, duly
authorized and licensed in such states to transact the applicable insurance
business and to write the insurance provided by the insurance policy issued by
it, approved as an insurer by Fannie Mae and Freddie Mac.

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     Rating Agencies: Standard & Poor’s Ratings Services, a division of The
McGraw- Hill Companies, Inc., Moody’s Investors Service, Inc., Fitch, Inc. or,
in the event that some or all ownership of the Mortgage Loans is evidenced by
mortgage-backed securities, the nationally recognized rating agencies issuing
ratings with respect to such securities, if any.
     Reconstitution Agreement: The agreement or agreements entered into by the
Seller and the Purchaser and certain third parties on the Reconstitution Date or
Reconstitution Dates with respect to any or all of the Mortgage Loans serviced
hereunder, in connection with a Whole Loan Transfer or a Securitization
Transaction as provided in Subsection 32.01.
     Reconstitution Date: The date or dates on which any or all of the Mortgage
Loans serviced under this Agreement shall be removed from this Agreement and
reconstituted as part of a Whole Loan Transfer or Securitization Transaction
pursuant to Section 32 hereof. On such date, the Mortgage Loans transferred
shall cease to be covered by this Agreement and the Seller shall cease to
service such Mortgage Loans under this Agreement.
     Record Date: The close of business of the last Business Day of the month
preceding the month of the related Remittance Date.
     Regulation AB: Subpart 229.1100 – Asset Backed Securities (Regulation AB),
17 C.F.R. §§229.1100-229.1123, as such may be amended from time to time, and
subject to such clarification and interpretation as have been provided by the
Commission in the adopting release (Asset-Backed Securities, Securities Act
Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff
of the Commission, or as may be provided by the Commission or its staff from
time to time.
     Regulation AB Compliance Addendum: Addendum I attached hereto and
incorporated herein by reference thereto.
     Refinanced Mortgage Loan: A Mortgage Loan which was made to a Mortgagor who
owned the Mortgaged Property prior to the origination of such Mortgage Loan and
the proceeds of which were used in whole or part to satisfy an existing
mortgage.
     REMIC: A “real estate mortgage investment conduit” within the meaning of
Section 860D of the Code.
     Remittance Date: The 18th day (or if such 18th day is not a Business Day,
the first Business Day immediately preceding such 18th day) of any month,
beginning with the First Remittance Date with respect to each Mortgage Loan
Package.
     REO Disposition: The final sale by the Servicer or the Purchaser of an REO
Property.
     REO Disposition Proceeds: All amounts received with respect to an REO
Disposition pursuant to Subsection 11.13.
     REO Property: A Mortgaged Property acquired by the Servicer through
foreclosure or deed in lieu of foreclosure, as described in Subsection 11.13.

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     Repurchase Price: With respect to any Mortgage Loan, a price equal to
(i) the product of the Purchase Price Percentage and the Stated Principal
Balance of the Mortgage Loan, plus, (ii) interest on such outstanding principal
balance at the related Mortgage Loan Remittance Rate from the last date through
which interest was last paid and distributed to the Purchaser to the last day of
the month in which such repurchase occurs, plus, (iii) reasonable and customary
third party expenses incurred in connection with the transfer of the Mortgage
Loan being repurchased; provided, however, that if at the time of repurchase the
Servicer is not the Seller or an affiliate of the Seller, the amount described
in clause (ii) shall be computed at the sum of (i) the Mortgage Loan Remittance
Rate and (ii) the Servicing Fee Rate.
     Residential Dwelling: Any one of the following: (i) a detached one-family
dwelling, (ii) a detached two- to four-family dwelling, (iii) a one-family
dwelling unit in a condominium project or (iv) a one-family dwelling in a
planned unit development, none of which is a cooperative, mobile or manufactured
home.
     Securities Act: The Securities Act of 1933, as amended.
     Securitization Transaction: Any transaction involving either (1) a sale or
other transfer of some or all of the Mortgage Loans directly or indirectly by
the Purchaser to an issuing entity in connection with an issuance of publicly
offered or privately placed, rated or unrated mortgage-backed securities or
(2) an issuance of publicly offered or privately placed, rated or unrated
securities, the payments on which are determined primarily by reference to one
or more portfolios of residential mortgage loans consisting, in whole or in
part, of some or all of the Mortgage Loans.
     Seller: Bank of America, National Association, a national banking
association, or its successor in interest or any successor to the Seller under
this Agreement appointed as herein provided.
     Servicer: Bank of America, National Association, a national banking
association, or its successor in interest or any successor to the Servicer under
this Agreement appointed as herein provided.
     Servicing Advances: All customary, reasonable and necessary out-of-pocket
costs and expenses incurred in the performance by the Servicer of its servicing
obligations, including, but not limited to, the cost of (a) the preservation,
restoration and protection of the Mortgaged Property, (b) any enforcement or
judicial proceedings, including foreclosures, (c) the management and liquidation
of the Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage, and (d) payments made by the Servicer with respect to a
Mortgaged Property pursuant to Subsection 11.08.
     Servicing Fee: With respect to each Mortgage Loan, the amount of the annual
fee the Purchaser shall pay to the Servicer, which shall, for each month, be
equal to one-twelfth of the product of the applicable Servicing Fee Rate and the
Stated Principal Balance of such Mortgage Loan. Such fee shall be payable
monthly, computed on the basis of the same principal amount and period
respecting which any related interest payment on a Mortgage Loan is computed.
The obligation of the Purchaser to pay the Servicing Fee is limited to, and
payable solely from, the

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interest portion (including recoveries with respect to interest from Liquidation
Proceeds and other proceeds, to the extent permitted by Subsection 11.05) of
related Monthly Payments collected by the Servicer, or as otherwise provided
under Subsection 11.05.
     Servicing Fee Rate: With respect to each Mortgage Loan, the per annum rate
set forth on the related Mortgage Loan Schedule or if not specified thereon, in
the related Term Sheet.
     Servicing File: With respect to each Mortgage Loan, the documents
pertaining thereto specified in Exhibit 2 and copies of all documents for such
Mortgage Loan specified in Exhibit 1.
     Servicing Officer: Any officer of the Servicer involved in, or responsible
for, the administration and servicing of the Mortgage Loans whose name appears
on a list of servicing officers furnished to the Purchaser by the Servicer, as
such list may be amended from time to time.
     Stated Principal Balance: As to each Mortgage Loan as to any date of
determination, (i) the principal balance of the Mortgage Loan as of the first
day of the month for which such calculation is being made after giving effect to
the principal portion of any Monthly Payments due on or before such date,
whether or not received, as well as any Principal Prepayments received before
such date, minus (ii) all amounts previously distributed to the Purchaser with
respect to the Mortgage Loan representing payments or recoveries of principal,
or advances in lieu thereof.
     Substitute Mortgage Loan: A mortgage loan substituted by the Seller for a
Deleted Mortgage Loan which must, on the date of such substitution, be approved
by the Purchaser and meet the conditions described in Section 7.03(b) of this
Agreement.
     Term Sheet: With respect to each Mortgage Loan and Mortgage Loan Package,
the Term Sheet, substantially in the form of Exhibit 6 attached hereto,
confirming the sale by Seller and the purchase by the Purchaser of the Mortgage
Loan Package on the related Closing Date.
     Transfer Date: The date or dates, set forth in the related Term Sheet, on
which the servicing related provisions of this Agreement will become effective
and the Servicer will begin servicing the Mortgage Loans for the benefit of the
Purchaser.
     Underwriting Guidelines: As to each Mortgage Loan Package, the written
underwriting guidelines in effect as of the origination date of such Mortgage
Loans, attached hereto as Exhibit 3, as may be updated and incorporated into
Exhibit 3 from time to time by attaching such updates to the Term Sheet.
     Whole Loan Transfer: Any sale or transfer by the Purchaser of some or all
of the Mortgage Loans (including an Agency Transfer), other than a
Securitization Transaction.
     SECTION 2. Purchase and Conveyance.
     The Seller, in exchange for the payment of the applicable Purchase Price by
the Purchaser on the related Closing Date, receipt of which is hereby
acknowledged, hereby sells,

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transfers, assigns, sets over and conveys to the Purchaser, without recourse,
but subject to the terms of this Agreement, all of its rights, title and
interest in and to the Mortgage Loans in a Mortgage Loan Package having a Stated
Principal Balance in an amount as set forth in the related Term Sheet, or in
such other amount as agreed by the Purchaser and the Seller as evidenced by the
actual aggregate principal balance of the Mortgage Loan Package accepted by the
Purchaser on the related Closing Date, together with the related Mortgage Files
and all rights and obligations arising under the documents contained therein,
other than the servicing rights to such Mortgage Loans.
     With respect to each Mortgage Loan, the Purchaser shall own and be entitled
to (1) the principal portion of all Monthly Payments due after the related
Cut-off Date, (2) all other recoveries of principal collected after the related
Cut-off Date (provided, however, that the principal portion of all Monthly
Payments due on or before the related Cut-off Date and collected by the Seller
or any successor servicer after the related Cut-off Date shall belong to the
Seller), and (3) all payments of interest on the Mortgage Loans (minus that
portion of any such payment which is allocable to the period prior to the
related Cut-off Date). The Stated Principal Balance of each Mortgage Loan as of
the related Cut-off Date is determined after application of payments of
principal due on or before the related Cut-off Date whether or not collected,
together with any unscheduled Principal Prepayments collected prior to the
related Cut-off Date; provided, however, that Monthly Payments for a Due Date
beyond the Cut-off Date shall not be applied to reduce the principal balance.
Such Monthly Payments shall be the property of the Purchaser. The Seller shall
remit any such Monthly Payments to the Purchaser on the Remittance Date
following collection thereof.
     SECTION 3. Mortgage Loan Schedule.
     The Seller shall deliver the Mortgage Loan Schedule (which will be annexed
to the related Term Sheet) to the Purchaser at least two (2) Business Days prior
to the related Closing Date.
     SECTION 4. Purchase Price.
     The Purchase Price for the Mortgage Loans being acquired on a Closing Date
shall be equal to the sum of (a) the product of (i) the Purchase Price
Percentage stated in the related Term Sheet (subject to adjustment as provided
therein) and (ii) the Stated Principal Balance of the Mortgage Loans listed on
the related Mortgage Loan Schedule, plus (b) an amount equal to accrued interest
on the aggregate Stated Principal Balance of the Mortgage Loans at the weighted
average Mortgage Interest Rate of such Mortgage Loans from the related Cut-off
Date through the day prior to the related Closing Date, both inclusive (assuming
30/360) (the “Purchase Price”). If so provided in the related Term Sheet,
portions of the Mortgage Loans shall be priced separately.
     The Purchase Price as set forth in the preceding paragraph for the Mortgage
Loans shall be paid on the related Closing Date by wire transfer of immediately
available funds.

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     SECTION 5. Examination of Mortgage Files.
     The Seller shall, at the direction of the Purchaser, (a) deliver to the
Purchaser or its designee in escrow, for examination with respect to each
Mortgage Loan to be purchased on the related Closing Date, the related Mortgage
File, or (b) make the related Mortgage File available to the Purchaser for
examination at the Seller’s offices or such other location as shall otherwise be
agreed upon by the Purchaser and the Seller. The Seller shall make available to
Purchaser the Mortgage File in digital format on compact disks or DVD which
shall include, without limitation, imaged documents as required for Purchaser’s
due diligence review. Such examination may be made by the Purchaser or its
designee at any reasonable time before or after the related Closing Date. The
Purchaser may, at its option and without notice to the Seller, purchase all or
part of the Mortgage Loan package without conducting any partial or complete
examination. The fact that the Purchaser has conducted or has determined not to
conduct any partial or complete examination of the Mortgage Files shall not
affect the Purchaser’s (or any of its successors’) rights to demand repurchase
or other relief or remedy provided for in this Agreement.
     SECTION 6. Delivery of Mortgage Loan Documents.
     Subsection 6.01 Possession of Mortgage Files.
     The contents of each Mortgage File required to be retained by the Servicer
to service the Mortgage Loans pursuant to this Agreement and thus not delivered
to the Purchaser or its designee are and shall be held in trust by the Servicer
for the benefit of the Purchaser as the owner thereof. The Servicer’s possession
of any portion of each such Mortgage File is at the will of the Purchaser for
the sole purpose of facilitating servicing of the Mortgage Loans pursuant to
this Agreement, and such retention and possession by the Servicer shall be in a
custodial capacity only. The ownership of each Mortgage Note, Mortgage and the
contents of each Mortgage File is vested in the Purchaser and the ownership of
all records and documents with respect to the related Mortgage Loan prepared by
or which come into the possession of the Servicer shall immediately vest in the
Purchaser and shall be retained and maintained, in trust, by the Servicer at the
will of the Purchaser in such custodial capacity only. The Mortgage File
retained by the Servicer with respect to each Mortgage Loan pursuant to this
Agreement shall be appropriately identified in the Servicer’s computer system to
reflect clearly the ownership of such related Mortgage Loan by the Purchaser.
The Servicer shall release from its custody the contents of any Mortgage File
retained by it only in accordance with this Agreement, except when such release
is required in connection with a repurchase of any such Mortgage Loan pursuant
to Subsection 7.03 of this Agreement or if required under applicable law or
court order.
     Subsection 6.02 Books and Records.
     The sale of each Mortgage Loan will be reflected on the Seller’s balance
sheet and other financial statements as a sale of assets by the Seller. The
Seller shall maintain a complete set of books and records for the Mortgage Loans
sold by it which shall be appropriately identified in the Seller’s computer
system to clearly reflect the ownership of the Mortgage Loans by the Purchaser.
     In addition to the foregoing, the Seller shall provide to any supervisory
agents or examiners that regulate the Purchaser, including but not limited to,
the OTS, the FDIC and other

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similar entities, access, during normal business hours, upon reasonable advance
notice to the Seller and without charge to the Seller or such supervisory agents
or examiners, to any documentation regarding the Mortgage Loans that may be
required by any applicable regulator.
     Subsection 6.03 Delivery of Mortgage Loan Documents.
     The Seller shall deliver and release to the Purchaser or its designee the
Mortgage Loan Documents no later than four (4) Business Days prior to the
related Closing Date. If the Seller cannot deliver the original recorded
Mortgage Loan Documents on the related Closing Date, the Seller shall, promptly
upon receipt thereof and in any case not later than 120 days from the Closing
Date, deliver such original recorded documents to the Purchaser or its designee
(unless the Seller is delayed in making such delivery by reason of the fact that
such documents shall not have been returned by the appropriate recording
office). If delivery is not completed within 120 days of the related Closing
Date solely because such documents shall not have been returned by the
appropriate recording office, the Seller shall deliver such document to
Purchaser, or its designee, within such time period as specified in a Seller’s
Officer’s Certificate. In the event that documents have not been received by the
date specified in the Seller’s Officer’s Certificate, a subsequent Seller’s
Officer’s Certificate shall be delivered by such date specified in the prior
Seller’s Officer’s Certificate, stating a revised date for receipt of
documentation. The procedure shall be repeated until the documents have been
received and delivered. The Seller shall use its best efforts to effect delivery
of all delayed recorded documents within 180 days of the related Closing Date.
If delivery of all Mortgage Loan Documents with respect to any Mortgage Loan is
not completed within 360 days of the related Closing Date then, at Purchaser’s
option, the Seller shall repurchase such Mortgage Loan in such manner set forth
in Section 7.03.
     Any review by the Purchaser or its designee of the Mortgage Files shall in
no way alter or reduce the Seller’s obligations hereunder.
     If the Purchaser or its designee discovers any defect with respect to any
document constituting part of a Mortgage File, the Purchaser shall, or shall
cause its designee to, give written specification of such defect to the Seller
and the Seller shall cure or repurchase such Mortgage Loan in accordance with
Section 7.03.
     The Seller shall forward to the Purchaser, or its designee, original
documents evidencing an assumption, modification, consolidation or extension of
any Mortgage Loan entered into within one week of their execution and shall also
provide the original of any document submitted for recordation or a copy of such
document certified by the appropriate public recording office to be a true and
complete copy of the original within five (5) days of its return from the
appropriate public recording office.
     SECTION 7. Representations, Warranties and Covenants; Remedies for Breach.
     Subsection 7.01 Representations and Warranties Regarding Individual
Mortgage Loans.
     The Seller and, solely as specified below, the Servicer, hereby represent
and warrant to the Purchaser that, as to each Mortgage Loan, as of the related
Closing Date or such other date specified herein:

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     (a) The information set forth in the Mortgage Loan Schedule annexed to the
related Term Sheet and the information contained in the related electronic data
file delivered by the Seller to the Purchaser is true, correct and complete.
     (b) There are no defaults by the Seller, the Servicer or any prior
originator in complying with the terms of the Mortgage, and all taxes, ground
rents, governmental assessments, insurance premiums, leasehold payments, water,
sewer and municipal charges which previously became due and owing have been
paid, or escrow funds have been established in an amount sufficient to pay for
every such escrowed item which remains unpaid and which has been assessed but is
not yet due and payable.
     (c) The terms of the Mortgage Note and the Mortgage have not been impaired,
waived, altered or modified in any respect, except by written instruments which
have been recorded in the applicable public recording office required by law or
if necessary to maintain the lien priority of the Mortgage, and which have been
delivered to the Purchaser; the substance of any such waiver, alteration or
modification has been approved by the insurer under the Primary Mortgage
Insurance Policy, if any, and by the title insurer, to the extent required by
the related policy, and is reflected on the related Mortgage Loan Schedule. No
other instrument of waiver, alteration or modification has been executed, and no
Mortgagor has been released, in whole or in part, except in connection with an
assumption agreement approved by the insurer under the Primary Mortgage
Insurance Policy, if any, and by the title insurer, to the extent required by
the policy, and which assumption agreement is a part of the Mortgage File and is
reflected on the related Mortgage Loan Schedule.
     (d) The Mortgage Note and the Mortgage are not subject to any right of
rescission, set-off, counterclaim or defense, including, without limitation, the
defense of usury, nor will the operation of any of the terms of the Mortgage
Note and the Mortgage, or the exercise of any right thereunder, render either
the Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject
to any right of rescission, set-off, counterclaim or defense, including, without
limitation, the defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto; and the
Mortgagor was not a debtor in any state or federal bankruptcy or insolvency
proceeding at the time the Mortgage Loan was originated.
     (e) All buildings or other customarily insured improvements upon the
Mortgaged Property are insured by an insurer generally acceptable to Fannie Mae
and to prudent mortgage lending institutions against loss by fire, hazards of
extended coverage and such other hazards as are provided for in the Fannie Mae
Guides as well as all additional requirements set forth herein, pursuant to an
insurance policy conforming to the requirements of Customary Servicing
Procedures and providing coverage in an amount equal to the lesser of (i) the
full insurable value of the Mortgaged Property or (ii) the outstanding principal
balance owing on the Mortgage Loan, but in no event less than the minimum amount
necessary to fully compensate for any damage or loss on a replacement cost
basis. All such insurance policies are in full force and effect and contain a
standard mortgagee clause naming the originator of the Mortgage Loan, its
successors and assigns as mortgagee and all premiums thereon have been paid. If
the Mortgaged Property is in an area identified on a flood hazard map or flood
insurance rate map issued by the Federal Emergency Management Agency as having
special flood hazards (and such flood insurance has been made available), a
flood insurance policy meeting the requirements of the current

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guidelines of the Federal Insurance Administration is in effect which policy
conforms to the requirements of Fannie Mae or Freddie Mac. Such flood insurance
policy is in an amount representing coverage not less than the least of (A) the
outstanding principal balance of the Mortgage Loan, (B) the full insurable value
of the related Mortgaged Property and (C) the maximum amount of insurance which
was available under the Flood Disaster Protection Act of 1973, as amended. All
individual insurance policies contain a standard mortgagee clause naming the
Seller and its successors and assigns as mortgagee, and all premiums thereon
have been paid. The Mortgage obligates the Mortgagor thereunder to maintain all
such insurance at the Mortgagor’s cost and expense, and on the Mortgagor’s
failure to do so, authorizes the holder of the Mortgage to maintain such
insurance at the Mortgagor’s cost and expense and to seek reimbursement therefor
from the Mortgagor. Each such insurance policy is the valid and binding
obligation of the insurer, is in full force and effect, and will be in full
force and effect and inure to the benefit of the Purchaser upon the consummation
of the purchase of the Mortgage Loans as contemplated by this Agreement. The
Seller has not acted or failed to act so as to impair the coverage of any such
insurance policy or the validity, binding effect and enforceability thereof;
     (f) Any and all requirements of any federal, state or local law including,
without limitation, usury, truth in lending, real estate settlement procedures,
consumer credit protection, equal credit opportunity, fair housing or disclosure
laws applicable to the origination and servicing of the Mortgage Loans have been
complied with. The Servicer maintains, and shall maintain, evidence of such
compliance as required by applicable law or regulation and shall make such
evidence available for inspection at the Servicer’s office during normal
business hours upon reasonable advance notice. No Mortgage Loan is (a) covered
by the Home Ownership and Equity Protection Act of 1994, as amended (“HOEPA”),
(b) a “high cost,” “threshold,” “covered,” “predatory,” “abusive,” “high risk
home” or similarly defined loan, including refinance loans, under any other
applicable law (or a similarly classified loan using different terminology under
a law imposing heightened regulatory scrutiny or additional legal liability for
residential mortgage loans having high interest rates, points and/or fees),
provided that any Mortgage Loan secured by a Mortgaged Property in Illinois
characterized as a “threshold” loan shall not be a “high cost” loan unless it is
characterized as “predatory” under applicable local law; the Seller has
implemented and conducted compliance procedures to determine if each Mortgage
Loan is “high-cost” home loan under the applicable laws and performed a review
of the disclosure provided to the related Mortgagor in accordance with such laws
and the related Mortgage Note in order to determine that such Mortgage Loan, if
subject to any such law, does not violate any such law or (c) a “High Cost Loan”
or “Covered Loan,” as defined in the then current Standard & Poor’s LEVELS®
Glossary, Appendix E.
     (g) The Mortgage has not been satisfied, canceled, subordinated or
rescinded, in whole or in part (other than as to Principal Prepayments in full
which may have been received on or after the related Cut-off Date and prior to
the related Closing Date), and the Mortgaged Property has not been released from
the lien of the Mortgage, in whole or in part, nor has any instrument been
executed that would effect any such satisfaction, cancellation, subordination,
rescission or release. Neither the Seller nor the Servicer has waived the
performance by the Mortgagor of any action, if the Mortgagor’s failure to
perform such action would cause the Mortgage Loan to be in default, and neither
the Seller nor the Servicer has waived any default.

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     (h) The Mortgage is a valid, existing, perfected and enforceable first lien
on the Mortgaged Property, including all improvements on the Mortgaged Property,
free and clear of all adverse claims, liens and encumbrances having priority
over the lien of the Mortgage, subject only to (i) the lien of current real
property taxes and assessments not yet due and payable, (ii) covenants,
conditions and restrictions, rights of way, easements and other matters of the
public record as of the date of recording being acceptable to mortgage lending
institutions generally and either (A) specifically referred to in the lender’s
title insurance policy delivered to the originator of the Mortgage Loan or
(B) which do not adversely affect the Appraised Value of the Mortgaged Property
and (iii) other matters to which like properties are commonly subject which do
not individually or in the aggregate materially interfere with the benefits of
the security intended to be provided by the Mortgage or the use, enjoyment,
value or marketability of the related Mortgaged Property. Any security
agreement, chattel mortgage or equivalent document related to and delivered in
connection with the Mortgage Loan establishes and creates a valid, existing and
enforceable first lien and first priority security interest on the property
described therein and the Seller has the full right to sell and assign the same
to the Purchaser.
     (i) The Mortgage Note and the related Mortgage are original and genuine and
each is the legal, valid and binding obligation of the maker thereof,
enforceable in all respects in accordance with its terms except as
enforceability may be limited by (i) bankruptcy, insolvency, liquidation,
receivership, moratorium, reorganization or other similar laws affecting the
enforcement of the rights of creditors and (ii) general principles of equity,
whether enforcement is sought in a proceeding in equity or at law and the Seller
has taken all action necessary to transfer such rights of enforceability to the
Purchaser.
     (j) All parties to the Mortgage Note and the Mortgage had the legal
capacity to enter into the Mortgage Loan and to execute and deliver the Mortgage
Note and the Mortgage, and the Mortgage Note and the Mortgage have been duly and
properly executed by such parties. Either the Mortgagor is a natural person or
the related co-borrower or guarantor is a natural person.
     (k) The proceeds of the Mortgage Loan have been fully disbursed to or for
the account of the Mortgagor and there is no obligation for the Mortgagee to
advance additional funds thereunder and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage have been paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due to the Mortgagee pursuant to the Mortgage Note or Mortgage.
     (l) The Seller and all other parties which have had any interest in the
Mortgage Loan, whether as mortgagee, assignee, pledgee or otherwise, are (or,
during the period in which they held and disposed of such interest, were) in
compliance with any and all applicable “doing business” and licensing
requirements of the laws of the state wherein the Mortgaged Property is located.
     (m) The Mortgage Loan is covered by an ALTA or CLTA lender’s title
insurance policy, acceptable to Fannie Mae or Freddie Mac, issued by a title
insurer acceptable to Fannie Mae or Freddie Mac and qualified to do business in
the jurisdiction where the Mortgaged Property is located, insuring (subject to
the exceptions contained in (h)(i), (ii) and (iii) above) the

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Seller, its successors and assigns as to the first priority lien of the Mortgage
in the original principal amount of the Mortgage Loan and, with respect to any
Adjustable Rate Mortgage Loan, against any loss by reason of the invalidity or
unenforceability of the lien resulting from the provisions of the Mortgage
providing for adjustment in the Mortgage Interest Rate or Monthly Payment. The
Seller and its successors and assigns are the sole insureds of such lender’s
title insurance policy, and such lender’s title insurance policy is in full
force and effect and will be in full force and effect upon the consummation of
the transactions contemplated by this Agreement and will inure to the benefit of
the Purchaser and its assigns without any further act. No claims have been made
under such lender’s title insurance policy, and no prior holder of the Mortgage
has done, by act or omission, anything which would impair the coverage of such
lender’s title insurance policy. In connection with the issuance of such
lender’s title insurance policy, no unlawful fee, commission, kickback or other
unlawful compensation or value of any kind has been or will be received,
retained or realized by any attorney, firm or other person or entity, and no
such unlawful items have been received, retained or realized by the Seller.
     (n) There is no default, breach, violation or event of acceleration
existing under the Mortgage or the Mortgage Note and no event which, with the
passage of time or with notice and the expiration of any grace or cure period,
would constitute a default, breach, violation or event permitting acceleration,
and neither the Seller nor the Servicer has waived any default, breach,
violation or event permitting acceleration.
     (o) There are no mechanics’ or similar liens or claims filed for work,
labor or material (and no rights are outstanding that under law could give rise
to such lien) affecting the related Mortgaged Property which are or may be liens
prior to, or equal or coordinate with, the lien of the related Mortgage.
     (p) All improvements which were considered in determining the Appraised
Value of the related Mortgaged Property lay wholly within the boundaries and
building restriction lines of the Mortgaged Property, and no improvements on
adjoining properties encroach upon the Mortgaged Property.
     (q) The Mortgage Loan was originated by a commercial bank or similar
banking institution which is supervised and examined by a federal or state
authority, or by a mortgagee approved by the Secretary of HUD.
     (r) Principal payments on the Mortgage Loan commenced no more than sixty
(60) days after (i) the IO Conversion Date, with respect to the IO Adjustable
Rate Mortgage Loans and (ii) the proceeds of the Mortgage Loan were disbursed,
with respect to all Mortgage Loans other than IO Adjustable Rate Mortgage Loans.
The Mortgage Loans identified on the related Mortgage Loan Schedule have an
original term to maturity of not more than (i) twenty-five (25) years with
respect to the IO Adjustable Rate Mortgage Loans and (ii) thirty (30) years with
respect to all other Mortgage Loans, with interest payable in arrears on the
first day of the month. As to each Adjustable Rate Mortgage Loan, on each
applicable Adjustment Date, the Mortgage Interest Rate will be adjusted to equal
the sum of the Index plus the applicable Gross Margin, rounded up or down as
provided in the Mortgage Note; provided, however, that the Mortgage Interest
Rate will not increase or decrease by more than the Initial Rate Cap on the
first Adjustment Date or the Periodic Rate Cap on any subsequent Adjustment
Date, if applicable, and

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will in no event exceed the Lifetime Rate Cap. Each Mortgage Note evidencing a
Mortgage Loan other than an Adjustable Rate Mortgage Loan requires a Monthly
Payment which is sufficient to amortize the original principal balance fully
over the original term thereof and to pay interest at the related Mortgage
Interest Rate. Each Mortgage Note evidencing an Adjustable Rate Mortgage Loan
requires a Monthly Payment which is sufficient (after the IO Conversion Date,
with respect to the IO Adjustable Rate Mortgage Loans) (i) during the period
prior to the first adjustment to the Mortgage Interest Rate, to amortize the
original principal balance fully over the remaining term thereof and to pay
interest at the related Mortgage Interest Rate, and (ii) during the period
following each Adjustment Date, to amortize the outstanding principal balance
fully as of the first day of such period over the then remaining term of such
Mortgage Note and to pay interest at the related Mortgage Interest Rate. No
Mortgage Note evidencing an Adjustable Rate Mortgage Loan permits negative
amortization. Interest on the Mortgage Note is calculated on the basis of a
360-day year consisting of twelve 30-day months. No Mortgage Loan provides for
interest payable on a simple interest basis. No Mortgage Loan provides for an
increase in the related Mortgage Interest Rate upon the occurrence of a default
under the terms of the related Mortgage Note. No IO Adjustable Rate Mortgage
Loan has an interest only period in excess of ten (10) years.
     (s) There is no proceeding pending or, to the Seller’s knowledge,
threatened for the total or partial condemnation of the Mortgaged Property and
such property is in good repair and is undamaged by waste, fire, earthquake or
earth movement, windstorm, flood, tornado or other casualty, so as to affect
adversely the value of the Mortgaged Property as security for the Mortgage Loan
or the use for which the premises were intended.
     (t) The Mortgage and related Mortgage Note contain customary and
enforceable provisions such as to render the rights and remedies of the holder
thereof adequate for the realization against the Mortgaged Property of the
benefits of the security provided thereby, including (i) in the case of a
Mortgage designated as a deed of trust, by trustee’s sale, and (ii) otherwise by
judicial foreclosure. To the best of the Seller’s knowledge, following the date
of origination of the Mortgage Loan, the Mortgaged Property has not been subject
to any bankruptcy proceeding or foreclosure proceeding and the Mortgagor has not
filed for protection under applicable bankruptcy laws. There is no homestead or
other exemption or right available to the Mortgagor or any other person which
would interfere with the right to sell the Mortgaged Property at a trustee’s
sale or the right to foreclose the Mortgage.
     (u) The Mortgage Note and Mortgage are on forms acceptable to Fannie Mae or
Freddie Mac.
     (v) The Mortgage Note is not and has not been secured by any collateral
except the lien of the corresponding Mortgage on the Mortgaged Property and the
security interest of any applicable security agreement or chattel mortgage
referred to in (h) above.
     (w) The Mortgage File contains an appraisal of the related Mortgaged
Property, in a form acceptable to Fannie Mae or Freddie Mac and such appraisal
complies with the requirements of FIRREA, and was made and signed, prior to the
approval of the Mortgage Loan application, by a Qualified Appraiser.

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     (x) In the event the Mortgage constitutes a deed of trust, a trustee, duly
qualified under applicable law to serve as such, has been properly designated
and currently so serves and is named in the Mortgage, and no fees or expenses
are or will become payable by the Purchaser to the trustee under the deed of
trust, except in connection with a trustee’s sale after default by the
Mortgagor.
     (y) The Mortgage Loan is not a graduated payment mortgage loan and the
Mortgage Loan does not have a shared appreciation, balloon payment or other
contingent interest feature, nor does it contain any “buydown” provision which
is currently in effect.
     (z) The Mortgage contains an enforceable provision for the acceleration of
the payment of the unpaid principal balance of the Mortgage Loan in the event
that the Mortgaged Property is sold or transferred without the prior written
consent of the mortgagee thereunder.
     (aa) The Mortgagor has received all disclosure materials required by
applicable law with respect to the making of mortgage loans of the same type as
the Mortgage Loan and rescission materials required by applicable law if the
Mortgage Loan is a Refinanced Mortgage Loan and has acknowledged receipt of such
materials to the extent required by applicable law and such documents will
remain in the Mortgage File.
     (bb) No Mortgage Loan has an LTV at origination in excess of 95%. Each
Mortgage Loan with an LTV at origination in excess of 80% will be subject to a
Primary Mortgage Insurance Policy, issued by an insurer acceptable to Fannie Mae
or Freddie Mac at the time of origination, which insures that portion of the
Mortgage Loan in excess of the portion of the Appraised Value of the Mortgaged
Property as required by Fannie Mae. All provisions of such Primary Mortgage
Insurance Policy have been and are being complied with, such policy is in full
force and effect, and all premiums due thereunder have been paid. Any Mortgage
subject to any such Primary Mortgage Insurance Policy obligates the Mortgagor
thereunder to maintain such insurance and to pay all premiums and charges in
connection therewith at least until the LTV of such Mortgage Loan is reduced to
less than 80%. The Mortgage Interest Rate for the Mortgage Loan does not include
any such insurance premium. No Mortgage Loan requires payment of such premiums,
in whole or in part, by the Purchaser.
     (cc) The Mortgaged Property is lawfully occupied under applicable law, all
inspections, licenses and certificates required to be made or issued with
respect to all occupied portions of the Mortgaged Property and, with respect to
the use and occupancy of the same, including but not limited to certificates of
occupancy, have been made or obtained from the appropriate authorities and no
improvement located on or part of the Mortgaged Property is in violation of any
zoning law or regulation.
     (dd) The Assignment of Mortgage is in recordable form and is acceptable for
recording under the laws of the jurisdiction in which the Mortgaged Property is
located.
     (ee) All payments required to be made prior to the related Cut-off Date for
such Mortgage Loan under the terms of the Mortgage Note have been made, the
Mortgage Loan has not been dishonored, there are no material defaults under the
terms of the Mortgage Loan; no Mortgage Loan has been more than thirty (30) days
delinquent in the twelve month period

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immediately prior to the related Cut-off Date and no Mortgage Loan will be more
than thirty (30) days delinquent as of the related Transfer Date.
     (ff) None of the Seller, the Servicer or any prior originator or servicer
has advanced funds, or induced, solicited or knowingly received any advance from
any party other than the Mortgagor, directly or indirectly, for the payment of
any amount due under the Mortgage Loan.
     (gg) With respect to each Mortgage Loan, the Seller is in possession of a
complete Mortgage File except for the documents which have been delivered to the
Purchaser or which have been submitted for recording and not yet returned.
     (hh) Immediately prior to the payment of the related Purchase Price, the
Seller was the sole owner and holder of the Mortgage Loans and the indebtedness
evidenced by the Mortgage Note. The Mortgage Loans, including the Mortgage Note
and the Mortgage, were not assigned or pledged by the Seller and the Seller had
good and marketable title thereto, and the Seller had full right to transfer and
sell the Mortgage Loans to the Purchaser free and clear of any encumbrance,
participation interest, lien, equity, pledge, claim or security interest and had
full right and authority subject to no interest or participation in, or
agreement with any other party to sell or otherwise transfer the Mortgage Loans.
Following the sale of the Mortgage Loans, the Purchaser will own such Mortgage
Loan free and clear of any encumbrance, equity, participation interest, lien,
pledge, charge, claim or security interest. The Seller intends to relinquish all
rights to monitor, possess and control the Mortgage Loan except in connection
with the servicing of the Mortgage Loan by the Servicer as set forth in this
Agreement. After the related Closing Date, neither the Seller nor the Servicer
will have any right to modify or alter the terms of the sale of the Mortgage
Loans and neither the Seller nor the Servicer will have any obligation or right
to repurchase the Mortgage Loans, except as provided in this Agreement or as
otherwise agreed to by the Seller, the Servicer and the Purchaser.
     (ii) Any future advances made prior to the related Cut-off Date have been
consolidated with the outstanding principal amount secured by the Mortgage, and
the secured principal amount, as consolidated, bears a single interest rate and
single repayment term. The lien of the Mortgage securing the consolidated
principal amount is expressly insured as having first lien priority by a title
insurance policy, an endorsement to the policy insuring the mortgagee’s
consolidated interest or by other title evidence acceptable to Fannie Mae and
Freddie Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan.
     (jj) The Mortgage Loan was underwritten in accordance with the Underwriting
Guidelines in effect at the time of origination with exceptions thereto
exercised in a reasonable manner.
     (kk) The Mortgaged Property is located in the state identified in the
related Mortgage Loan Schedule and consists of a parcel of real property with a
detached single family residence erected thereon, or a two- to four-family
dwelling, or an individual condominium unit, or an individual unit in a planned
unit development; provided, however, that any condominium project or planned
unit development generally conforms with the Underwriting Guidelines regarding

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such dwellings, and no residence or dwelling is a mobile home, manufactured
dwelling or cooperative.
     (ll) If the Mortgaged Property is a condominium unit or a planned unit
development (other than a de minimis planned unit development) such condominium
or planned unit development project meets Fannie Mae or Freddie Mac eligibility
requirements for sale to Fannie Mae or Freddie Mac, as the case may be, or is
located in a condominium or planned unit development project which has received
Fannie Mae or Freddie Mac project approval or as to which Fannie Mae’s and
Freddie Mac’s eligibility requirements have been waived.
     (mm) The Seller used no adverse selection procedures in selecting the
Mortgage Loan from among the outstanding first-lien, residential mortgage loans
owned by it which were available for inclusion in the Mortgage Loans.
     (nn) Each Mortgage Loan is a “qualified mortgage” within Section 860G(a)(3)
of the Code.
     (oo) With respect to each Mortgage where a lost note affidavit has been
delivered in place of the related Mortgage Note, the related Mortgage Note is no
longer in existence.
     (pp) No fraud, error, omission, misrepresentation, negligence or similar
occurrence with respect to the Mortgage Loan has taken place on the part of the
Seller, the Servicer or any originator or servicer or the Mortgagor or on the
part of any other party involved in the origination of the Mortgage Loan.
     (qq) The origination practices used by the Seller and the collection and
servicing practices used by the Servicer with respect to each Mortgage Loan have
been in all respects legal, proper, prudent and customary in the mortgage
origination and servicing industry and the collection and servicing practices
used by the Servicer have been acceptable to Fannie Mae and Freddie Mac.
     (rr) The Mortgagor is not in bankruptcy and is not insolvent and no
Mortgagor was a debtor in any state or federal bankruptcy or insolvency
proceeding at the time the Mortgage Loan was originated and the Mortgaged
Property has not been subject to any bankruptcy or foreclosure proceedings.
     (ss) Neither the Seller nor the Servicer have any knowledge of any
circumstances or condition with respect to the Mortgage, the Mortgaged Property,
the Mortgagor or the Mortgagor’s credit standing that could reasonably be
expected to cause investors to regard the Mortgage Loan as an unacceptable
investment, cause the Mortgage Loan to become delinquent or materially adversely
affect the value or the marketability of the Mortgage Loan.
     (tt) The Mortgagor has not notified the Seller or the Servicer, and neither
the Seller nor the Servicer has knowledge of any relief requested by the
Mortgagor under the Servicemembers Civil Relief Act, as amended, or any similar
state or local laws.

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          (uu) No Mortgage Loan was made in connection with (i) the construction
or rehabilitation of a Mortgaged Property or (ii) facilitating the trade-in or
exchange of a Mortgaged Property.
          (vv) The Mortgaged Property is free from any and all toxic or
hazardous substances and there exists no violation of any local, state or
federal environmental law, rule or regulation. There is no pending action or
proceeding directly involving any Mortgaged Property of which the Seller or the
Servicer is aware in which compliance with any environmental law, rule or
regulation is an issue and nothing further remains to be done to satisfy in full
all requirements of each such law, rule or regulation constituting a
prerequisite to use and enjoyment of said property.
          (ww) No action, inaction, or event has occurred and no state of
affairs exists or has existed that has resulted or will result in the exclusion
from, denial of, or defense to coverage under any applicable special hazard
insurance policy, Primary Mortgage Insurance Policy or bankruptcy bond,
irrespective of the cause of such failure of coverage. In connection with the
placement of any such insurance, no commission, fee, or other compensation has
been or will be received by the Seller or the Servicer or any designee of the
Seller or the Servicer or any corporation in which the Seller, the Servicer or
any officer, director, or employee of the Seller or the Servicer had a financial
interest at the time of placement of such insurance.
          (xx) With respect to any ground lease to which a Mortgaged Property
may be subject: (A) the Mortgagor is the owner of a valid and subsisting
leasehold interest under such ground lease; (B) such ground lease is in full
force and effect, unmodified and not supplemented by any writing or otherwise;
(C) all rent, additional rent and other charges reserved therein have been fully
paid to the extent payable as of the related Closing Date; (D) the Mortgagor
enjoys the quiet and peaceful possession of the leasehold estate; (E) the
Mortgagor is not in default under any of the terms of such ground lease, and
there are no circumstances which, with the passage of time or the giving of
notice, or both, would result in a default under such ground lease; (F) the
lessor under such ground lease is not in default under any of the terms or
provisions of such ground lease on the part of the lessor to be observed or
performed; (G) the lessor under such ground lease has satisfied any repair or
construction obligations due as of the related Closing Date pursuant to the
terms of such ground lease; (H) the execution, delivery and performance of the
Mortgage do not require the consent (other than those consents which have been
obtained and are in full force and effect) under, and will not contravene any
provision of or cause a default under, such ground lease; (I) the term of such
lease does not terminate earlier than the maturity date of the Mortgage Note;
(J) the ground lease is assignable or transferable; (K) the ground lease does
not provide for termination of the lease in the event of lessee’s default
without the mortgagee being entitled to receive written notice of, and a
reasonable opportunity to cure the default; (L) the ground lease permits the
mortgaging of the related Mortgaged Property; (M) the ground lease protects the
mortgagee’s interests in the event of a property condemnation; and (N) the use
of leasehold estates for residential properties is a widely accepted practice in
the jurisdiction in which the Mortgaged Property is located.
          (yy) Each Mortgage Loan originated in the state of Texas pursuant to
Article XVI, Section 50(a)(6) of the Texas Constitution (a “Texas Refinance
Loan”) has been originated in compliance with the provisions of Article XVI,
Section 50(a)(6) of the Texas Constitution, Texas

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Civil Statutes and the Texas Finance Code. If the Mortgage Loan was originated
in Texas, it is not a cash-out refinancing.
          (zz) All of the terms of the related Mortgage Note pertaining to
interest adjustments, payment adjustments and adjustments of the outstanding
principal balance, if any, are enforceable and such adjustments on such Mortgage
Loan have been made properly and in accordance with the provisions of such
Mortgage Loan.
          (aaa) No Mortgage Loan is subject to nullification pursuant to
Executive Order 13224 (the “Executive Order”) or the regulations promulgated by
the Office of Foreign Assets Control of the United States Department of the
Treasury (the “OFAC Regulations”) or in violation of the Executive Order or the
OFAC Regulations, and no Mortgagor is subject to the provisions of such
Executive Order or the OFAC Regulations nor listed as a “blocked person” for
purposes of the OFAC Regulations.
          (bbb) All information on the Mortgage Loan Schedule and electronic
data file delivered to the Purchaser regarding the Prepayment Penalty is
complete and accurate in all material respects and each Prepayment Penalty is
permissible and enforceable in accordance with its terms under applicable law.
Prepayment Penalties on the Mortgage Loans are applicable to prepayments
resulting from both refinancings and sales of the related Mortgaged Properties
and the terms of such Prepayment Penalties do not provide for a waiver or
release (i.e., “holidays”) during the term of the Prepayment Penalty. No
Mortgage Loan provides for the payment of a Prepayment Penalty beyond the
three-year term following the origination of the Mortgage Loan. With respect to
any Mortgage Loan that contains a provision permitting imposition of a
Prepayment Penalty: (i) prior to the Mortgage Loan’s origination, the Mortgagor
agreed to such Prepayment Penalty in exchange for a monetary benefit, including,
but not limited to, a rate or fee reduction, (ii) prior to the Mortgage Loan’s
origination, the Mortgagor was offered the choice of another mortgage product
that did not require payment of such a premium, (iii) the Prepayment Penalty is
disclosed to the Mortgagor in the loan documents pursuant to applicable state
and federal law, and (iv) notwithstanding any state or federal law to the
contrary, the Seller shall not impose such Prepayment Penalty in any instance
when the mortgage debt is accelerated as the result of the Mortgagor’s default
in making the Monthly Payments.
          (ccc) As to each consumer report (as defined in the Fair Credit
Reporting Act, Public Law 91-508) or other credit information furnished by the
Seller or the Servicer to the Purchaser, the Seller and the Servicer have full
right and authority and are not precluded by law or contract from furnishing
such information to the Purchaser and the Purchaser is not precluded from
furnishing the same to any subsequent or prospective purchaser of such Mortgage
Loan. The Seller shall hold the Purchaser harmless from any and all damages,
losses, costs and expenses (including attorney’s fees) arising from disclosure
of credit information in connection with the purchase and sale of Mortgage
Loans.
          (ddd) There is no action, suit, proceeding or investigation pending
or, to the knowledge of the Seller or the Servicer, threatened that is related
to the Mortgage Loan and likely to affect materially and adversely the servicing
of such Mortgage Loan.

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          (eee) With respect to escrow deposits and payments that the Servicer
is entitled to collect, all such payments are in the possession of, or under the
control of the Servicer, and there exist no deficiencies in connection therewith
for which customary arrangements for repayment thereof have not been made. All
escrow payments have been collected in full compliance with state and federal
law and the provisions of the related Mortgage Note and Mortgage. As to any
Mortgage Loan that is the subject of an escrow, escrow of funds is not
prohibited by applicable law and has been established in an amount sufficient to
pay for every escrowed item that remains unpaid and has been assessed but is not
yet due and payable. No escrow deposits or other charges or payments due under
the Mortgage Note have been capitalized under any Mortgage or the related
Mortgage Note.
          Subsection 7.02 Seller and Servicer Representations.
               The Seller and the Servicer hereby represent and warrant to the
Purchaser that, as to itself as of the related Closing Date:
          (a) It is a national banking association, duly organized, validly
existing, and in good standing under the laws of the United States and has all
licenses necessary to carry on its business as now being conducted and is
licensed, qualified and in good standing in the states where the Mortgaged
Property is located if the laws of such state require licensing or qualification
in order to conduct business of the type conducted by it. It is an approved
seller/servicer in good standing of conventional residential mortgage loans for
Fannie Mae or Freddie Mac and is a HUD-approved mortgagee under Section 203 of
the National Housing Act. It has corporate power and authority to execute and
deliver this Agreement and to perform in accordance herewith; the execution,
delivery and performance of this Agreement (including all instruments of
transfer to be delivered pursuant to this Agreement) by it and the consummation
of the transactions contemplated hereby have been duly and validly authorized.
This Agreement, assuming due authorization, execution and delivery by the
Purchaser, evidences the legal, valid, binding and enforceable obligation of it,
subject to applicable law except as enforceability may be limited by (i)
bankruptcy, insolvency, liquidation, receivership, moratorium, reorganization or
other similar laws affecting the enforcement of the rights of creditors and
(ii) general principles of equity, whether enforcement is sought in a proceeding
in equity or at law. All requisite corporate action has been taken by it to make
this Agreement valid and binding upon it in accordance with the terms of this
Agreement.
          (b) No consent, approval, authorization or order is required for the
transactions contemplated by this Agreement from any court, governmental agency
or body, or federal or state regulatory authority having jurisdiction over it
or, if required, such consent, approval, authorization or order has been or
will, prior to the related Closing Date, be obtained.
          (c) The consummation of the transactions contemplated by this
Agreement are in its ordinary course of business and will not result in the
breach of any term or provision of its articles of association or by-laws or
result in the breach of any term or provision of, or conflict with or constitute
a default under or result in the acceleration of any obligation under, any
agreement, indenture or loan or credit agreement or other instrument to which it
or its property is

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subject, or result in the violation of any law, rule, regulation, order,
judgment or decree to which it or its property is subject.
          (d) Its transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages pursuant to this Agreement are not subject to the bulk transfer or
any similar statutory provisions in effect in any applicable jurisdiction.
          (e) There is no action, suit, proceeding or investigation pending or,
to its best knowledge, threatened against it which, either individually or in
the aggregate, would result in any material adverse change in its business,
operations, financial condition, properties or assets, or in any material
impairment of its right or ability to carry on its business substantially as now
conducted or which would draw into question the validity of this Agreement or
the Mortgage Loans or of any action taken or to be taken in connection with its
obligations contemplated herein, or which would materially impair its ability to
perform under the terms of this Agreement.
          (f) To the best of the Seller’s knowledge, the Seller is not in
material default under any agreement, contract, instrument or indenture to which
the Seller is a party or by which it (or any of its assets) is bound, which
default would have a material adverse effect on the ability of the Seller to
perform under this Agreement, nor, to the best of the Seller’s knowledge, has
any event occurred which, with the giving of notice, the lapse of time or both,
would constitute a default under any such agreement, contract, instrument or
indenture and have a material adverse effect on the ability of the Seller to
perform its obligations under this Agreement.
          (g) It does not believe, nor does it have any reason or cause to
believe, that it cannot perform each and every covenant contained in this
Agreement.
          (h) It acknowledges and agrees that the Servicing Fee shall be treated
by the Servicer, for accounting and tax purposes, as compensation for the
servicing and administration of the Mortgage Loans pursuant to this Agreement.
          (i) It has determined that the disposition of the Mortgage Loans
pursuant to this Agreement will be afforded sale treatment for accounting and
tax purposes.
          (j) It is solvent and the sale of the Mortgage Loans will not cause it
to become insolvent. The sale of the Mortgage Loans is not undertaken with the
intent to hinder, delay or defraud any of its creditors.
          (k) It has not dealt with any broker, investment banker, agent or
other person that may be entitled to any commission or compensation in
connection with the sale of the Mortgage Loans.
          (l) To the best of the Seller’s knowledge, neither this Agreement nor
any statement, report or other agreement, document or instrument furnished or to
be furnished pursuant to this Agreement contains any materially untrue statement
of fact or omits to state a fact necessary to make the statements contained
therein not misleading.

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          Subsection 7.03 Repurchase; Substitution.
          (a) It is understood and agreed that the representations and
warranties set forth in Sections 7.01 and 7.02 shall survive the sale of the
Mortgage Loans and delivery of the Mortgage File to the Purchaser, or its
designee, and shall inure to the benefit of the Purchaser, notwithstanding any
restrictive or qualified endorsement on any Mortgage Note or Assignment or the
examination, or lack of examination, of any Mortgage Loan Document. With respect
to the representations and warranties contained in Section 7.02 that are made to
the best of Seller’s knowledge after reasonable inquiry and investigation, if it
is discovered by either the Seller or the Purchaser that the substance of such
representation and warranty is inaccurate and such inaccuracy materially and
adversely affects the value of the related Mortgage Loan, the Purchaser shall be
entitled to all the remedies to which it would be entitled for a breach of
representation or warranty, including, without limitation, the repurchase
requirements contained herein, notwithstanding Seller’s lack of knowledge with
respect to the inaccuracy at the time the representation or warranty was made.
Upon discovery by the Seller, the Servicer or the Purchaser of a breach of any
of the foregoing representations and warranties which materially and adversely
affects the value of the Mortgage Loans or the interest of the Purchaser in any
Mortgage Loan, the party discovering such breach shall give prompt written
notice to the other. The Seller shall have a period of sixty (60) days from the
earlier of its discovery or its receipt of notice of any such breach within
which to correct or cure such breach. The Seller hereby covenants and agrees
that if any such breach is not corrected or cured within such sixty (60) day
period, the Seller shall, at the Purchaser’s option either repurchase such
Mortgage Loan at the Repurchase Price or substitute a mortgage loan for the
defective Mortgage Loan as provided below. In the event that any such breach
shall involve any representation or warranty set forth in Section 7.02, and such
breach is not cured within sixty (60) days of the earlier of either discovery by
or notice to the Seller of such breach, all Mortgage Loans shall, at the option
of the Purchaser, be repurchased by the Seller at the Repurchase Price. Any such
repurchase shall be accomplished by wire transfer of the amount of the
Repurchase Price to an account designated by the Purchaser.
          (b) If the Seller is required to repurchase any Mortgage Loan pursuant
to this Subsection 7.03 as a result of a breach of any of the representations
and warranties set forth in Subsection 7.01, the Seller may, with the
Purchaser’s prior consent, within two (2) years from the related Closing Date,
remove such defective Mortgage Loan from the terms of this Agreement and
substitute another mortgage loan for such defective Mortgage Loan, in lieu of
repurchasing such defective Mortgage Loan. Any Substitute Mortgage Loan shall
(a) have a principal balance at the time of substitution not in excess of the
principal balance of the Deleted Mortgage Loan (the amount of any difference,
plus one month’s interest thereon at the Mortgage Loan Remittance Rate borne by
the Deleted Mortgage Loan, being paid by the Seller and deemed to be a Principal
Prepayment to an account designated by the Purchaser), (b) have a Mortgage
Interest Rate not less than, and not more than one percentage point greater
than, the Mortgage Interest Rate of the Deleted Mortgage Loan, (c) have a
remaining term to stated maturity not later than, and not more than one year
less than, the remaining term to stated maturity of the Deleted Mortgage Loan,
(d) be, in the reasonable determination of the Purchaser, of the same type,
quality and character (including location of the Mortgaged Property) as the
Deleted Mortgage Loan as if the breach had not occurred, (e) have a
Loan-to-Value Ratio at origination no greater than that of the Deleted Mortgage
Loan, (f) have the same lien priority as

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that of the Deleted Mortgage Loan and (g) be, in the reasonable determination of
the Purchaser, in material compliance with the representations and warranties
contained in this Agreement and described in Subsection 7.01 as of the date of
substitution.
          (c) The Seller shall amend the related Mortgage Loan Schedule to
reflect the withdrawal of the Deleted Mortgage Loan from this Agreement and the
substitution of such substitute Mortgage Loan therefore. Upon such amendment,
the Purchaser shall review the Mortgage File delivered to it relating to the
substitute Mortgage Loan. The Monthly Payment on a substitute Mortgage Loan due
on the Due Date in the month of substitution shall be the property of the Seller
and the Monthly Payment on the Deleted Mortgage Loan for which the substitution
is made due on such date shall be the property of the Purchaser.
          (d) It is understood and agreed that the obligation of the Seller set
forth in this Subsection 7.03 to cure, repurchase or substitute for a defective
Mortgage Loan, and to indemnify Purchaser pursuant to Subsection 12.01,
constitutes the sole remedies of the Purchaser respecting a breach of the
foregoing representations and warranties. If the Seller fails to repurchase or
substitute for a defective Mortgage Loan in accordance with this Subsection
7.03, or fails to cure a defective Mortgage Loan to Purchaser’s reasonable
satisfaction in accordance with this Subsection 7.03, or to indemnify Purchaser
pursuant to Subsection 12.01, that failure shall be an Event of Default and the
Purchaser shall be entitled to pursue all available remedies. No provision of
this paragraph shall affect the rights of the Purchaser to terminate this
Agreement for cause, as set forth in Subsections 13.01 and 14.01.
          (e) Any cause of action against the Seller or the Servicer, as
applicable, relating to or arising out of the breach of any representations and
warranties made in Subsections 7.01 and 7.02 shall accrue as to any Mortgage
Loan upon (i) notice thereof by the Purchaser to the Seller or the Servicer, as
applicable, (ii) failure by the Seller or the Servicer, as applicable, to cure
such breach or repurchase such Mortgage Loan as specified above, and
(iii) demand upon the Seller or the Servicer, as applicable, by the Purchaser
for compliance with this Agreement.
          (f) In the event that any Mortgage Loan is held by a REMIC,
notwithstanding any contrary provision of this Agreement, with respect to any
Mortgage Loan that is not in default or as to which no default is imminent,
Purchaser may, in connection with any repurchase or substitution of a defective
Mortgage Loan pursuant to this Subsection 7.03, require that the Seller deliver,
at the Seller’s expense, an Opinion of Counsel to the effect that such
repurchase or substitution will not (i) result in the imposition of taxes on
“prohibited transactions” of such REMIC (as defined in Section 860F of the Code)
or otherwise subject the REMIC to tax, or (ii) cause the REMIC to fail to
qualify as a REMIC at any time.
          Subsection 7.04 Repurchase of Mortgage Loans With Early Payment
Default.
          If a Monthly Payment becomes one (1) or more scheduled Monthly
Payments delinquent at any time on or prior to the first day of the second
calendar month following the related Closing Date (or such other date set forth
in the related Term Sheet), then the Seller, at the Purchaser’s option, shall
(a) promptly repurchase the related Mortgage Loan from the Purchaser in
accordance with the procedures set forth in Subsection 7.03 hereof, however, any
such repurchase shall be made at the Repurchase Price, (b) indemnify the
Purchaser in accordance

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with Subsection 12.01 hereof, or (c) substitute a mortgage loan acceptable to
the Purchaser in accordance with Subsection 7.03 hereof.
          Subsection 7.05 Purchase Price Protection.
          With respect to any Mortgage Loan that prepays in full on or prior to
the last day of the third full month following the related Closing Date (or such
other date set forth in the related Term Sheet, the Seller shall reimburse the
Purchaser an amount equal to the product of (a) the amount by which Purchase
Price Percentage paid by the Purchaser to the Seller for such Mortgage Loan
exceeds 100% and (b) the outstanding principal balance of the Mortgage Loan as
of the Cut-off Date. Such payment shall be made within thirty (30) days of such
payoff.
          SECTION 8. Closing. Subsection 8.01 Closing Conditions.
          The closing for the purchase and sale of each Mortgage Loan Package
shall take place on the respective Closing Date. The closing shall be either by
telephone, confirmed by letter or wire as the parties hereto shall agree, or
conducted in person, at such place as the parties hereto shall agree.
          The closing for each Mortgage Loan Package shall be subject to the
satisfaction of each of the following conditions:
          (a) the Seller shall have delivered to the Purchaser the related
Mortgage Loan Schedule and an electronic data file containing information on a
loan-level basis;
          (b) all of the representations and warranties of the Seller under this
Agreement shall be true and correct as of the related Closing Date (or, with
respect to Subsection 7.01, such other date specified therein) in all material
respects and no default shall have occurred hereunder which, with notice or the
passage of time or both, would constitute an Event of Default hereunder;
          (c) the Purchaser shall have received from the custodian an initial
certification with respect to its receipt of the Mortgage Loan Documents for the
related Mortgage Loans;
          (d) the Purchaser shall have received originals of the related Term
Sheet executed by the Seller and a funding memorandum setting forth the Purchase
Price(s), and the accrued interest thereon, for the Mortgage Loan Package; and
          (e) all other terms and conditions of this Agreement and the related
Term Sheet to be satisfied by the Seller shall have been complied with in all
material respects.
          Upon satisfaction of the foregoing conditions, the Purchaser shall pay
to the Seller on such Closing Date the Purchase Price for the related Mortgage
Loan Package, plus accrued interest pursuant to Section 4 of this Agreement.

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          Subsection 8.02 Closing Documents.
          (a)  On or before the initial Closing Date, the Seller shall submit to
the Purchaser fully executed originals of the following documents:

  (i)   this Agreement, in four counterparts;     (ii)   if requested by the
Purchaser, a Custodial Account Letter Agreement;     (iii)   if requested by the
Purchaser, an Escrow Account Letter Agreement; and

          (b)  On or before each Closing Date, the Seller shall submit to the
Purchaser fully executed originals of the following documents:

  (i)   the related Term Sheet;     (ii)   the related Mortgage Loan Schedule;

(iii)     the Purchaser shall have received from its custodian an initial
certification with respect to its receipt of the Mortgage Loan Documents for the
related Mortgage Loans;
(iv)     a certificate or other evidence of merger or change of name, signed or
stamped by the applicable regulatory authority, if any of the Mortgage Loans
were acquired by the Seller by merger or acquired or originated by the Seller
while conducting business under a name other than its present name, if
applicable.
          SECTION 9. [Reserved.]
          SECTION 10. Costs.
          The Seller and the Servicer shall pay any commissions due their
salespeople and the legal fees and expenses of their attorneys. The Purchaser
shall pay the cost of delivering the Mortgage Files to the Purchaser or its
designee, the cost of recording the Assignments of Mortgage, any custodial fees
incurred in connection with the release of any Mortgage Loan Documents as may be
required by the servicing activities hereunder and all other costs and expenses
incurred in connection with the sale of the Mortgage Loans by the Seller to the
Purchaser, including without limitation the Purchaser’s attorneys’ fees. The
Seller shall pay the cost of delivering the Mortgage Loan Documents to the
Purchaser or its designee for each related Closing Date.
          SECTION 11. Administration and Servicing of Mortgage Loans.
          Subsection 11.01 Servicer to Act as Servicer; Subservicing.
          Effective as of each related Transfer Date, the Servicer, as an
independent contractor, shall service and administer the Mortgage Loans in
accordance with this Agreement and Customary Servicing Procedures and the terms
of the Mortgage Notes and Mortgages, and shall have full power and authority,
acting alone or through subservicers or agents, to do or cause to

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be done any and all things in connection with such servicing and administration
which the Servicer may deem necessary or desirable and consistent with the terms
of this Agreement. With respect to each Mortgage Loan Package, the related
Mortgage Loans shall be serviced on an interim basis by a servicer to be chosen
by the Purchaser, the Servicer shall have no obligations or duties or
liabilities hereunder or otherwise with respect to the servicing of such
Mortgage Loans prior to the related Transfer Date; provided, however, the
Servicer shall be entitled to the Servicing Fees with respect to such Mortgage
Loan Package as of the related Closing Date. The Purchaser and the Servicer
agree to direct payment of such Servicing Fees, net of any fees agreed to by the
Purchaser and the Servicer due to any servicer or subservicer of the related
Mortgage Loans for the period from the Closing Date to the Transfer Date, to the
Servicer at the time of any related remittance for such period on such Mortgage
Loans. The Servicer may perform its servicing responsibilities through agents or
independent contractors, but shall not thereby be released from any of its
responsibilities hereunder. Notwithstanding anything to the contrary, the
Servicer may delegate any of its duties under this Agreement to one or more of
its affiliates without regard to any of the requirements of this section;
provided, however, that the Servicer shall not be released from any of its
responsibilities hereunder by virtue of such delegation. The Mortgage Loans may
be subserviced by one or more unaffiliated subservicers on behalf of the
Servicer provided each subservicer is a Fannie Mae approved seller/servicer or a
Freddie Mac approved seller/servicer in good standing, and no event has
occurred, including but not limited to a change in insurance coverage, that
would make it unable to comply with the eligibility for seller/servicers imposed
by Fannie Mae or Freddie Mac, or which would require notification to Fannie Mae
or Freddie Mac. The Servicer shall pay all fees and expenses of the subservicer
from its own funds (provided that any such expenditures that would constitute
Servicing Advances if made by the Servicer hereunder shall be reimbursable to
the Servicer as Servicing Advances), and the subservicer’s fee shall not exceed
the Servicing Fee.
          At the cost and expense of the Servicer, without any right of
reimbursement from the Custodial Account, the Servicer shall be entitled to
terminate the rights and responsibilities of a subservicer and arrange for any
servicing responsibilities to be performed by a successor subservicer meeting
the requirements in the preceding paragraph; provided, however, that nothing
contained herein shall be deemed to prevent or prohibit the Servicer, at the
Servicer’s option, from electing to service the related Mortgage Loans itself.
If the Servicer’s responsibilities and duties under this Agreement are
terminated and if requested to do so by the Purchaser, the Servicer shall at its
own cost and expense terminate the rights and responsibilities of the
subservicer as soon as is reasonably possible. The Servicer shall pay all fees,
expenses or penalties necessary in order to terminate the rights and
responsibilities of the subservicer from the Servicer’s own funds without
reimbursement from the Purchaser.
          The Servicer shall be entitled to enter into an agreement with the
subservicer for indemnification of the Servicer by the subservicer and nothing
contained in this Agreement shall be deemed to limit or modify such
indemnification.
          Any subservicing agreement and any other transactions or services
relating to the Mortgage Loans involving the subservicer shall be deemed to be
between the subservicer and Servicer alone, and the Purchaser shall have no
obligations, duties or liabilities with respect to the subservicer including no
obligation, duty or liability of the Purchaser to pay the subservicer’s fees and
expenses. For purposes of distributions and advances by the Servicer pursuant to
this

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Agreement, the Servicer shall be deemed to have received a payment on a Mortgage
Loan when the subservicer has received such payment.
          Consistent with the terms of this Agreement, and subject to the REMIC
Provisions if the Mortgage Loans have been transferred to a REMIC, the Servicer
may waive, modify or vary any term of any Mortgage Loan or consent to the
postponement of strict compliance with any such term or in any manner grant
indulgence to any Mortgagor; provided, however, that (unless the Mortgagor is in
default with respect to the Mortgage Loan, or such default is, in the judgment
of the Servicer, imminent, and the Servicer has the consent of the Purchaser)
the Servicer shall not enter into any payment plan or agreement to modify
payments with a Mortgagor lasting more than six (6) months or permit any
modification with respect to any Mortgage Loan that would change the Mortgage
Interest Rate, the Lifetime Rate Cap (if applicable), the Initial Rate Cap (if
applicable), the Periodic Rate Cap (if applicable) or the Gross Margin (if
applicable), defer or forgive the payment of any principal or interest, change
the outstanding principal amount (except for actual payments of principal), make
any future advances or extend the final maturity date with respect to such
Mortgage Loan, or accept substitute or additional collateral or release any
collateral for such Mortgage Loan. Without limiting the generality of the
foregoing, the Servicer in its own name or acting through subservicers or agents
is hereby authorized and empowered by the Purchaser when the Servicer believes
it appropriate and reasonable in its best judgment, to execute and deliver, on
behalf of itself or the Purchaser, all instruments of satisfaction or
cancellation, or of partial or full release, discharge and all other comparable
instruments, with respect to the Mortgage Loans and the Mortgaged Properties and
to institute foreclosure proceedings or obtain a deed-in-lieu of foreclosure so
as to convert the ownership of such properties, and to hold or cause to be held
title to such properties, on behalf of the Purchaser pursuant to the provisions
of Subsection 11.13.
          The Purchaser shall furnish to the Servicer any powers of attorney and
other documents reasonably necessary or appropriate to enable the Servicer to
carry out its servicing and administrative duties under this Agreement.
          Whether in connection with the foreclosure of a Mortgage Loan or
otherwise, the Servicer shall from its own funds make all necessary and proper
Servicing Advances; provided, however, that the Servicer is not required to make
a Servicing Advance unless the Servicer determines in the exercise of its good
faith judgment that such Servicing Advance would ultimately be recoverable from
REO Disposition Proceeds, Insurance Proceeds or Condemnation Proceeds (with
respect to each of which the Servicer shall have the priority described in
Subsection 11.05 for purposes of withdrawals from the Custodial Account). Any
Servicing Advance in excess of $15,000 shall be made only with the written
approval of the Purchaser.
          Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure, in
the event the Servicer has reasonable cause to believe that a Mortgaged Property
is contaminated by hazardous or toxic substances or wastes, or if the Purchaser
otherwise requests an environmental inspection or review of such Mortgaged
Property, such an inspection or review is to be conducted by a qualified
inspector at the Purchaser’s expense. Upon completion of the inspection, the
Servicer shall promptly provide the Purchaser with a written report of the
environmental inspection. In the event (a) the environmental inspection report
indicates that the Mortgaged Property is

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contaminated by hazardous or toxic substances or wastes and (b) the Purchaser
directs the Servicer to proceed with foreclosure or acceptance of a deed in lieu
of foreclosure, the Servicer shall be reimbursed for all reasonable costs
associated with such foreclosure or acceptance of a deed in lieu of foreclosure
and any related environmental clean up costs, as applicable, from the related
Liquidation Proceeds, or if the Liquidation Proceeds are insufficient fully to
reimburse the Servicer, the Servicer shall be entitled to be reimbursed from
amounts in the Custodial Account pursuant to Subsection 11.05 hereof. In the
event the Purchaser directs the Servicer not to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure, the Servicer shall be reimbursed
for all Servicing Advances made with respect to the related Mortgaged Property
from the Custodial Account pursuant to Subsection 11.05 hereof.
          Subsection 11.02 Liquidation of Mortgage Loans.
          In the event that any payment due under any Mortgage Loan is not paid
when the same becomes due and payable, or in the event the Mortgagor fails to
perform any other covenant or obligation under the Mortgage Loan and such
failure continues beyond any applicable grace period, the Servicer shall take
such action as it shall deem to be in the best interest of the Purchaser. In the
event that any payment due under any Mortgage Loan remains delinquent for a
period of ninety (90) days or more, the Servicer shall commence foreclosure
proceedings in accordance with Customary Servicing Procedures and the guidelines
set forth by Fannie Mae or Freddie Mac and FHA or VA, as applicable. In such
connection, the Servicer shall from its own funds make all necessary and proper
Servicing Advances. If the portion of any Liquidation Proceeds allocable as a
recovery of interest on any Mortgage Loan is less than the full amount of
accrued and unpaid interest on such Mortgage Loan as of the date such proceeds
are received, then the applicable Servicing Fees with respect to such Mortgage
Loan shall be paid first and any amounts remaining thereafter shall be
distributed to the Purchaser.
          Subsection 11.03 Collection of Mortgage Loan Payments.
          Continuously from the date hereof until the principal and interest on
all Mortgage Loans are paid in full, the Servicer will proceed diligently, in
accordance with this Agreement, to collect all payments due under each of the
Mortgage Loans when the same shall become due and payable. Further, the Servicer
will in accordance with Customary Servicing Procedures ascertain and estimate
taxes, assessments, fire and hazard insurance premiums, premiums for Primary
Mortgage Insurance Policies, and all other charges that, as provided in any
Mortgage, will become due and payable to the end that the installments payable
by the Mortgagors will be sufficient to pay such charges as and when they become
due and payable.
          Subsection 11.04 Establishment of Custodial Account; Deposits in
Custodial Account.
          The Servicer shall segregate and hold all funds collected and received
pursuant to each Mortgage Loan separate and apart from any of its own funds and
general assets and shall establish and maintain one or more Custodial Accounts
(collectively, the “Custodial Account”), titled “Bank of America, National
Association, in trust for RWT Holdings, Inc. as Purchaser of Mortgage Loans and
various Mortgagors.” Such Custodial Account shall be established with a
commercial bank, a savings bank or a savings and loan association (which may be
a depository affiliate of the Servicer) which meets the guidelines set forth by
Fannie Mae or Freddie Mac as

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an eligible depository institution for custodial accounts. The Custodial Account
shall initially be established and maintained at Bank of America, National
Association, or any successor thereto, and shall not be transferred to any other
depository institution without the Purchaser’s approval, which shall not
unreasonably be withheld. In any case, the Custodial Account shall be insured by
the FDIC in a manner which shall provide maximum available insurance thereunder
and which may be drawn on by the Servicer.
          The Servicer shall deposit in the Custodial Account on a daily basis,
and retain therein the following payments and collections received or made by it
subsequent to the related Cut-off Date (other than in respect of principal and
interest on the Mortgage Loans due on or before the related Cut-off Date):
(a) all payments on account of principal, including Principal Prepayments, on
the Mortgage Loans;
(b) all payments on account of interest on the Mortgage Loans adjusted to the
related Mortgage Loan Remittance Rate;
(c) all Liquidation Proceeds;
(d) all proceeds received by the Servicer under any title insurance policy,
hazard insurance policy, Primary Mortgage Insurance Policy or other insurance
policy other than proceeds to be held in the Escrow Account and applied to the
restoration or repair of the Mortgaged Property or released to the Mortgagor in
accordance with Customary Servicing Procedures;
(e) all awards or settlements in respect of condemnation proceedings or eminent
domain affecting any Mortgaged Property which are not released to the Mortgagor
in accordance with Customary Servicing Procedures;
(f) any amount required to be deposited in the Custodial Account pursuant to
Subsections 11.15, 11.17 and 11.19;
(g) any amount required to be deposited by the Servicer in connection with any
REO Property pursuant to Subsection 11.13;
(h) all amounts required to be deposited by the Servicer in connection with
shortfalls in principal amount of Substitute Mortgage Loans pursuant to
Subsection 7.03;
(i) with respect to each Full Prepayment and each Partial Prepayment, an amount
(to be paid by the Servicer out of its own funds) equal to the Prepayment
Interest Shortfall; provided, however, that the Servicer’s aggregate obligations
under this paragraph for any month shall be limited to the total amount of
Servicing Fees actually received with respect to the Mortgage Loans by the
Servicer during such month; and
(j) amounts required to be deposited by the Servicer in connection with the
deductible clause of any hazard insurance policy.

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          The foregoing requirements for deposit in the Custodial Account shall
be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of late payment charges,
assumption fees and other ancillary fees need not be deposited by the Servicer
in the Custodial Account.
          The Servicer may invest the funds in the Custodial Account in Eligible
Investments designated in the name of the Servicer for the benefit of the
Purchaser, which shall mature not later than the Business Day next preceding the
Remittance Date next following the date of such investment (except that (A) any
investment in the institution with which the Custodial Account is maintained may
mature on such Remittance Date and (B) any other investment may mature on such
Remittance Date if the Servicer shall advance funds on such Remittance Date,
pending receipt thereof to the extent necessary to make distributions to the
Purchaser) and shall not be sold or disposed of prior to maturity.
Notwithstanding anything to the contrary herein and above, all income and gain
realized from any such investment shall be for the benefit of the Servicer and
shall be subject to withdrawal by the Servicer. The amount of any losses
incurred in respect of any such investments shall be deposited in the Custodial
Account by the Servicer out of its own funds immediately as realized.
          Subsection 11.05 Withdrawals From the Custodial Account.
          The Servicer shall, from time to time, withdraw funds from the
Custodial Account for the following purposes:
(a) to make payments to the Purchaser in the amounts and in the manner provided
for in Subsection 11.15;
(b) to reimburse itself for P&I Advances, the Servicer’s right to reimburse
itself pursuant to this subclause (b) with respect to any Mortgage Loan being
limited to related Liquidation Proceeds, Condemnation Proceeds, Insurance
Proceeds and such other amounts as may be collected by the Servicer from the
Mortgagor or otherwise relating to the Mortgage Loan, it being understood that,
in the case of any such reimbursement, the Servicer’s right thereto shall be
prior to the rights of the Purchaser with respect to such Mortgage Loan, except
that, where the Seller is required to repurchase a Mortgage Loan, pursuant to
Subsection 7.03, the Servicer’s right to such reimbursement shall be subsequent
to the payment to the Purchaser of the Repurchase Price pursuant to Subsection
7.03, and all other amounts required to be paid to the Purchaser with respect to
such Mortgage Loan;
(c) to reimburse itself for any unpaid Servicing Fees and for unreimbursed
Servicing Advances, the Servicer’s right to reimburse itself pursuant to this
subclause (c) with respect to any Mortgage Loan being limited to related
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds and such other
amounts as may be collected by the Servicer from the Mortgagor or otherwise
relating to the Mortgage Loan, it being understood that, in the case of any such
reimbursement, the Servicer’s right thereto shall be prior to the rights of the
Purchaser unless the Seller is required to repurchase a Mortgage Loan pursuant
to Subsection 7.03, or Seller is required to pay the Prepayment Interest
Shortfall pursuant to Subsection 11.15, in which case the Servicer’s right to
such reimbursement shall be subsequent to the payment to the

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Purchaser of the related Repurchase Price pursuant to Subsection 7.03, or Seller
is required to pay Prepayment Interest Shortfall pursuant to Subsection 11.15,
and all other amounts required to be paid to the Purchaser with respect to such
Mortgage Loan;
(d) to reimburse itself for unreimbursed Servicing Advances and for unreimbursed
P&I Advances, to the extent that such amounts are nonrecoverable (as certified
by the Servicer to the Purchaser in an Officer’s Certificate) by the Servicer
pursuant to subclause (b) or (c) above, provided that the Mortgage Loan for
which such advances were made is not required to be repurchased by a Seller
pursuant to Subsection 7.03;
(e) to reimburse itself for expenses incurred by and reimbursable to it pursuant
to Subsection 12.01;
(f) to withdraw amounts to make P&I Advances in accordance with Subsection
11.17;
(g) to pay to itself any interest earned or any investment earnings on funds
deposited in the Custodial Account, net of any losses on such investments;
(h) to withdraw any amounts inadvertently deposited in the Custodial Account;
and
(i) to clear and terminate the Custodial Account upon the termination of this
Agreement.
          Upon request, the Servicer will provide the Purchaser with copies of
reasonably acceptable invoices or other documentation relating to Servicing
Advances that have been reimbursed from the Custodial Account.
          Subsection 11.06 Establishment of Escrow Account; Deposits in Escrow
Account.
          The Servicer shall segregate and hold all funds collected and received
pursuant to each Mortgage Loan which constitute Escrow Payments separate and
apart from any of its own funds and general assets and shall establish and
maintain one or more Escrow Accounts (collectively, the “Escrow Account”),
titled “Bank of America, National Association, in trust for RWT Holdings, Inc.
as Purchaser of Mortgage Loans and various Mortgagors.” The Escrow Account shall
be established with a commercial bank, a savings bank or a savings and loan
association (which may be a depository affiliate of Servicer), which meets the
guidelines set forth by Fannie Mae or Freddie Mac as an eligible institution for
escrow accounts. The Escrow Account shall initially be established and
maintained at Bank of America, National Association, or any successor thereto,
and shall not be transferred to any other depository institution without the
Purchaser’s approval, which shall not unreasonably be withheld. In any case, the
Escrow Account shall be insured by the FDIC in a manner which shall provide
maximum available insurance thereunder and which may be drawn on by the
Servicer.
          The Servicer shall deposit in the Escrow Account on a daily basis, and
retain therein: (a) all Escrow Payments collected on account of the Mortgage
Loans, for the purpose of effecting timely payment of any such items as required
under the terms of this Agreement and (b) all amounts representing proceeds of
any hazard insurance policy which are to be applied to the restoration or repair
of any Mortgaged Property. The Servicer shall make withdrawals therefrom only in
accordance with Subsection 11.07 hereof. As part of its servicing duties, the

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Servicer shall pay to the Mortgagors interest on funds in the Escrow Account, to
the extent required by law.
          Subsection 11.07 Withdrawals From Escrow Account.
          Withdrawals from the Escrow Account shall be made by the Servicer only
(a) to effect timely payments of ground rents, taxes, assessments, premiums for
Primary Mortgage Insurance Policies, fire and hazard insurance premiums or other
items constituting Escrow Payments for the related Mortgage, (b) to reimburse
the Servicer for any Servicing Advance made by Servicer pursuant to Subsection
11.08 hereof with respect to a related Mortgage Loan, (c) to refund to any
Mortgagor any funds found to be in excess of the amounts required under the
terms of the related Mortgage Loan, (d) for transfer to the Custodial Account
upon default of a Mortgagor or in accordance with the terms of the related
Mortgage Loan and if permitted by applicable law, (e) for application to restore
or repair of the Mortgaged Property, (f) to pay to the Mortgagor, to the extent
required by law, any interest paid on the funds deposited in the Escrow Account,
(g) to pay to itself any interest earned on funds deposited in the Escrow
Account (and not required to be paid to the Mortgagor), (h) to the extent
permitted under the terms of the related Mortgage Note and applicable law, to
pay late fees with respect to any Monthly Payment which is received after the
applicable grace period, (i) to withdraw suspense payments that are deposited
into the Escrow Account, (j) to withdraw any amounts inadvertently deposited in
the Escrow Account or (k) to clear and terminate the Escrow Account upon the
termination of this Agreement.
          Subsection 11.08 Payment of Taxes, Insurance and Other Charges;
Collections Thereunder.
          With respect to each Mortgage Loan, the Servicer shall maintain
accurate records reflecting the status of ground rents, taxes, assessments and
other charges which are or may become a lien upon the Mortgaged Property and the
status of premiums for Primary Mortgage Insurance Policies and fire and hazard
insurance coverage and shall obtain, from time to time, all bills for the
payment of such charges (including renewal premiums) and shall effect payment
thereof prior to the applicable penalty or termination date and at a time
appropriate for securing maximum discounts allowable, employing for such purpose
deposits of the Mortgagor in the Escrow Account which shall have been estimated
and accumulated by the Servicer in amounts sufficient for such purposes, as
allowed under the terms of the Mortgage. To the extent that a Mortgage does not
provide for Escrow Payments, the Servicer shall determine that any such payments
are made by the Mortgagor. The Servicer assumes full responsibility for the
timely payment of all such bills and shall effect timely payments of all such
bills irrespective of each Mortgagor’s faithful performance in the payment of
same or the making of the Escrow Payments and shall make Servicing Advances to
effect such payments, subject to its ability to recover such Servicing Advances
pursuant to Subsections 11.05(c), 11.05(d) and 11.07(b). No costs incurred by
the Servicer or subservicers in effecting the payment of taxes and assessments
on the Mortgaged Properties shall, for the purpose of calculating remittances to
the Purchaser, be added to the amount owing under the related Mortgage Loans,
notwithstanding that the terms of such Mortgage Loans so permit.

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          Subsection 11.09 Transfer of Accounts.
          The Servicer may transfer the Custodial Account or the Escrow Account
to a different depository institution. Such transfer shall be made only upon
providing written notice to the Purchaser.
          Subsection 11.10 Maintenance of Hazard Insurance.
          The Servicer shall cause to be maintained for each Mortgage Loan fire
and hazard insurance with extended coverage customary in the area where the
Mortgaged Property is located by an insurer acceptable to Fannie Mae or Freddie
Mac and FHA or VA, as applicable, in an amount which is at least equal to the
lesser of (a) the full insurable value of the Mortgaged Property or (b) the
greater of (i) the outstanding principal balance owing on the Mortgage Loan and
(ii) an amount such that the proceeds of such insurance shall be sufficient to
avoid the application to the Mortgagor or loss payee of any coinsurance clause
under the policy. If the Mortgaged Property is in an area identified in the
Federal Register by the Federal Emergency Management Agency as a special flood
hazard area (and such flood insurance has been made available) the Servicer will
cause to be maintained a flood insurance policy meeting the requirements of the
National Flood Insurance Program, in an amount representing coverage not less
than the lesser of (A) the minimum amount required under the terms of the
coverage to compensate for any damage or loss to the Mortgaged Property on a
replacement-cost basis (or the outstanding principal balance of the Mortgage
Loan if replacement-cost basis is not available) or (B) the maximum amount of
insurance available under the National Flood Insurance Program. The Servicer
shall also maintain on REO Property fire and hazard insurance with extended
coverage in an amount which is at least equal to the maximum insurable value of
the improvements which are a part of such property, liability insurance and, to
the extent required and available under the National Flood Insurance Program,
flood insurance in an amount required above. Any amounts collected by the
Servicer under any such policies (other than amounts to be deposited in the
Escrow Account and applied to the restoration or repair of the property subject
to the related Mortgage or property acquired in liquidation of the Mortgage
Loan, or to be released to the Mortgagor in accordance with Customary Servicing
Procedures) shall be deposited in the Custodial Account, subject to withdrawal
pursuant to Subsection 11.05. It is understood and agreed that no earthquake or
other additional insurance need be required by the Servicer of any Mortgagor or
maintained on REO Property other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. All policies required hereunder shall be endorsed with
standard mortgagee clauses with loss payable to Servicer, and shall provide for
at least thirty (30) days prior written notice of any cancellation, reduction in
amount or material change in coverage to the Servicer. The Servicer shall not
interfere with the Mortgagor’s freedom of choice in selecting either its
insurance carrier or agent; provided, however, that the Servicer shall not
accept any such insurance policies from insurance companies unless such
companies are acceptable to Fannie Mae or Freddie Mac and FHA or VA, as
applicable, and are licensed to do business in the state wherein the property
subject to the policy is located.
          The hazard insurance policies for each Mortgage Loan secured by a unit
in a condominium development or planned unit development shall be maintained
with respect to such

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Mortgage Loan and the related development in a manner which is consistent with
Fannie Mae or Freddie Mac requirements and FHA or VA requirements, as
applicable.
          Subsection 11.11 Maintenance of Primary Mortgage Insurance Policy;
Claims.
          With respect to each Mortgage Loan with a LTV in excess of 80%, the
Servicer shall, without any cost to the Purchaser, maintain or cause the
Mortgagor to maintain in full force and effect a Primary Mortgage Insurance
Policy insuring the portion over 78% (or such other percentage in conformance
with then current Fannie Mae requirements until terminated pursuant to the
Homeowners Protection Act of 1988, 12 USC § 4901, et seq. or any other
applicable federal, state or local law or regulation. In the event that such
Primary Mortgage Insurance Policy shall be terminated other than as required by
law, the Servicer shall obtain from another insurer a comparable replacement
policy, with a total coverage equal to the remaining coverage of such terminated
Primary Mortgage Insurance Policy. If the insurer shall cease to be a qualified
insurer, the Servicer shall obtain from another qualified insurer a replacement
Primary Mortgage Insurance Policy. The Servicer shall not take any action which
would result in noncoverage under any applicable Primary Mortgage Insurance
Policy of any loss which, but for the actions of the Servicer would have been
covered thereunder. In connection with any assumption or substitution agreement
entered into or to be entered into pursuant to Subsection 11.18, the Servicer
shall promptly notify the insurer under the related Primary Mortgage Insurance
Policy, if any, of such assumption or substitution of liability in accordance
with the terms of such Primary Mortgage Insurance Policy and shall take all
actions which may be required by such insurer as a condition to the continuation
of coverage under such Primary Mortgage Insurance Policy. If such Primary
Mortgage Insurance Policy is terminated as a result of such assumption or
substitution of liability, the Servicer shall obtain a replacement Primary
Mortgage Insurance Policy as provided above.
          In connection with its activities as servicer, the Servicer agrees to
prepare and present or to assist the Purchaser in preparing and presenting, on
behalf of itself and the Purchaser, claims to the insurer under any Primary
Mortgage Insurance Policy in a timely fashion in accordance with the terms of
such Primary Mortgage Insurance Policy and, in this regard, to take such action
as shall be necessary to permit recovery under any Primary Mortgage Insurance
Policy respecting a defaulted Mortgage Loan. Pursuant to Subsection 11.06, any
amounts collected by the Servicer under any Primary Mortgage Insurance Policy
shall be deposited in the Escrow Account, subject to withdrawal pursuant to
Subsection 11.07.
          Subsection 11.12 Fidelity Bond; Errors and Omissions Insurance.
          The Servicer shall maintain, at its own expense, a blanket Fidelity
Bond and an errors and omissions insurance policy, with broad coverage on all
officers, employees or other persons acting in any capacity requiring such
persons to handle funds, money, documents or papers relating to the Mortgage
Loans. These policies must insure the Servicer against losses resulting from
fraud, theft, errors, omissions, negligence, dishonest or fraudulent acts
committed by the Servicer’s personnel, any employees of outside firms that
provide data processing services for the Servicer, and temporary contract
employees or student interns. The Fidelity Bond shall also protect and insure
the Servicer against losses in connection with the release or satisfaction of a
Mortgage Loan without having obtained payment in full of the indebtedness
secured thereby.

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No provision of this Subsection 11.12 requiring such Fidelity Bond and errors
and omissions insurance shall diminish or relieve the Servicer from its duties
and obligations as set forth in this Agreement. The minimum coverage under any
such Fidelity Bond and insurance policy shall be at least equal to the
corresponding amounts required by FHA or VA, Fannie Mae in the Fannie Mae Guides
or by Freddie Mac in the Freddie Mac Guide, as amended or restated from time to
time, as applicable, or in an amount as may be permitted to the Servicer by
express waiver of FHA or VA and Fannie Mae or Freddie Mac, as applicable. Upon
request of the Purchaser, the Servicer shall cause to be delivered to the
Purchaser a certified true copy of such Fidelity Bond or a certificate
evidencing the same with a statement that the Servicer shall endeavor to provide
written notice to the Purchaser thirty (30) days prior to modification or any
material change.
          Subsection 11.13 Title, Management and Disposition of REO Property.
          (a) Subject to Subsection 11.02, in the event that title to the
Mortgaged Property is acquired in foreclosure or by deed in lieu of foreclosure,
the deed or certificate of sale shall be taken in the name of the Purchaser or
its nominee.
          (b) The Purchaser, by giving notice to the Servicer, may elect to
manage and dispose of all REO Property acquired pursuant to this Agreement by
itself. If the Purchaser so elects, the Purchaser shall assume control of REO
Property at the time of its acquisition and the Servicer shall forward the
related Mortgage File to the Purchaser as soon as is practicable. Promptly upon
assumption of control of any REO Property, the Purchaser shall reimburse any
related Servicing Advances or other expenses incurred by the Servicer with
respect to that REO Property.
          (c) If the Purchaser has not informed the Servicer that it will manage
REO Property, the provisions of this Subsection 11.13(c) shall apply. The
Servicer shall cause to be deposited on a daily basis in the Custodial Account
all revenues received with respect to the conservation of the related REO
Property. The Servicer shall make distributions as required on each Remittance
Date to the Purchaser of the net cash flow from the REO Property (which shall
equal the revenues from such REO Property net of the expenses described above
and of any reserves reasonably required from time to time to be maintained to
satisfy anticipated liabilities for such expenses).
          The disposition of REO Property shall be carried out by the Servicer,
subject to Subsection 11.01. The Purchaser shall pay the Servicer a fee of 1.5%
of the sales price for such REO Property for services associated with managing
the REO Property through its disposition. Upon the request of the Purchaser, and
at the Purchaser’s expense, the Servicer shall cause an appraisal of the REO
Property to be performed for the Purchaser.
          The Servicer shall either itself or through an agent selected by the
Servicer, manage, conserve, protect and operate the REO Property in the same
manner that it manages, conserves, protects and operates other foreclosed
property for its own account, and in the same manner that similar property in
the same locality as the REO Property is managed. Any disbursement in excess of
$15,000 shall be made only with the written approval of the Purchaser. The
Servicer shall deduct such costs from the proceeds of the sale of the REO
Property (providing documentary evidence of such costs) and shall not withdraw
funds to cover such costs from the Custodial Account.

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          Subsection 11.14 Servicing Compensation.
          As compensation for its services hereunder and subject to Subsection
11.15, the Servicer shall be entitled to retain the Servicing Fee from interest
payments actually collected on the Mortgage Loans. Additional servicing
compensation in the form of assumption fees, late payment charges, prepayment
penalties, fees related to the disposition of REO Property and other ancillary
income shall be retained by the Servicer to the extent not required to be
deposited in the Custodial Account. The Servicer shall be required to pay all
expenses incurred by it in connection with its servicing activities hereunder
and shall not be entitled to reimbursement therefor except as specifically
provided for herein. The Servicing Fee shall not be reduced by the amount of any
guarantee fee payable to FHA or VA.
          Subsection 11.15 Distributions.
          On each Remittance Date the Servicer shall remit by wire transfer of
immediately available funds to the account designated in writing by the
Purchaser of record on the preceding Record Date (a) all amounts credited to the
Custodial Account at the close of business on the related Determination Date,
net of charges against or withdrawals from the Custodial Account pursuant to
Subsection 11.05(b) through (h), plus (b) all amounts, if any, which the
Servicer is obligated to distribute pursuant to Subsection 11.17, minus (c) any
amounts attributable to Principal Prepayments received after the end of the
calendar month preceding the month in which the Remittance Date occurs, minus
(d) any amounts attributable to Monthly Payments collected but due on a Due Date
or Due Dates subsequent to the first day of the month in which the Remittance
Date occurs.
          Not later than each Remittance Date, the Seller shall from its own
funds deposit in the Custodial Account an amount equal to the aggregate
Prepayment Interest Shortfall due to either Partial Prepayment or Full
Prepayment, if any, existing in respect of the related Principal Prepayment
Period.
          With respect to any remittance received by the Purchaser after the
Business Day on which such payment was due, the Servicer shall pay to the
Purchaser interest on any such late payment at an annual rate equal to the rate
of interest as is publicly announced from time to time at its principal office
by Bank of America, National Association, or its successor, as its prime lending
rate, adjusted as of the date of each change, plus two percent (2%), but in no
event greater than the maximum amount permitted by applicable law. Such interest
shall be paid by the Servicer to the Purchaser on the date such late payment is
made and shall cover the period commencing with the Business Day on which such
payment was due and ending with the Business Day immediately preceding the
Business Day on which such payment is made, both inclusive. The payment by the
Servicer of any such interest shall not be deemed an extension of time for
payment or a waiver of any Event of Default by the Servicer.
          Subsection 11.16 Statements to the Purchaser.
          Not later than five (5) days prior to each related Remittance Date,
the Servicer shall forward to the Purchaser in an electronic format a statement,
substantially in the form of Exhibit 5 and certified by a Servicing Officer,
setting forth on a loan-by-loan basis: (a) the amount of

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the distribution made on such Remittance Date which is allocable to principal
and allocable to interest; (b) the amount of servicing compensation received by
the Servicer during the prior calendar month; and (c) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the preceding
month. Such statement shall also include information regarding delinquencies on
Mortgage Loans, indicating the number and aggregate principal amount of Mortgage
Loans which are either one (1), two (2) or three (3) or more months delinquent.
The Servicer shall submit to the Purchaser monthly a liquidation report with
respect to each Mortgaged Property sold in a foreclosure sale as of the related
Record Date and not previously reported. Such liquidation report shall be
incorporated into the remittance report delivered to Purchaser in the form of
Exhibit 5 hereto. The Servicer shall also provide such information as set forth
above to the Purchaser in electronic form in the Servicer’s standard format, a
copy of which has been provided by the Servicer.
          The Servicer shall prepare and file any and all tax returns,
information statements or other filings required to be delivered to any
governmental taxing authority, the Mortgagor or to the Purchaser pursuant to any
applicable law with respect to the Mortgage Loans and the transactions
contemplated hereby. In addition, the Servicer shall provide the Purchaser with
such information concerning the Mortgage Loans as is necessary for such
Purchaser to prepare federal income tax returns as the Purchaser may reasonably
request from time to time.
          Subsection 11.17 Advances by the Servicer.
          On the Business Day immediately preceding each related Remittance
Date, the Servicer shall either (a) deposit in the Custodial Account from its
own funds an amount equal to the aggregate amount of all Monthly Payments (with
interest adjusted to the Mortgage Loan Remittance Rate) which were due on the
Mortgage Loans during the applicable Due Period and which were delinquent at the
close of business on the immediately preceding Determination Date (each such
advance, a “P&I Advance”), (b) cause to be made an appropriate entry in the
records of the Custodial Account that amounts held for future distribution have
been, as permitted by this Subsection 11.17, used by the Servicer in discharge
of any such P&I Advance or (c) make P&I Advances in the form of any combination
of (a) or (b) aggregating the total amount of advances to be made. Any amounts
held for future distribution and so used shall be replaced by the Servicer by
deposit in the Custodial Account on or before any future Remittance Date if
funds in the Custodial Account on such Remittance Date shall be less than
payments to the Purchaser required to be made on such Remittance Date. The
Servicer’s obligation to make P&I Advances as to any Mortgage Loan will continue
through the last Monthly Payment due prior to the payment in full of a Mortgage
Loan, or through the last related Remittance Date prior to the Remittance Date
for the distribution of all other payments or recoveries (including proceeds
under any title, hazard or other insurance policy, or condemnation awards) with
respect to a Mortgage Loan; provided, however, that such obligation shall cease
if the Servicer, in its good faith judgment, determines that such P&I Advances
would not be recoverable pursuant to Subsection 11.05(d). The determination by
the Servicer that a P&I Advance, if made, would be nonrecoverable, shall be
evidenced by an Officer’s Certificate of the Servicer, delivered to the
Purchaser, which details the reasons for such determination. The Servicer shall
not have any obligation to advance amounts in respect of shortfalls relating to
the Servicemembers Civil Relief Act and similar state and local laws.

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          Subsection 11.18 Assumption Agreements.
          The Servicer will use its best efforts to enforce any “due-on-sale”
provision contained in any Mortgage or Mortgage Note; provided that, subject to
the Purchaser’s prior approval, the Servicer shall permit such assumption if so
required in accordance with the terms of the Mortgage or the Mortgage Note. When
the Mortgaged Property has been conveyed by the Mortgagor prior to payment in
full of the Mortgage Loan, the Servicer will, to the extent it has knowledge of
such conveyance, exercise its rights to accelerate the maturity of such Mortgage
Loan under the “due-on-sale” clause applicable thereto; provided, however, the
Servicer will not exercise such rights if prohibited by law from doing so or if
the exercise of such rights would impair or threaten to impair any recovery
under the related Primary Mortgage Insurance Policy, if any. In connection with
any such assumption, the outstanding principal amount, the Monthly Payment, the
Mortgage Interest Rate, the Lifetime Rate Cap (if applicable), the Gross Margin
(if applicable), the Initial Rate Cap (if applicable) or the Periodic Rate Cap
(if applicable) of the related Mortgage Note shall not be changed, and the term
of the Mortgage Loan will not be increased or decreased. If an assumption is
allowed pursuant to this Subsection 11.18, the Servicer with the prior consent
of the issuer of the Primary Mortgage Insurance Policy, if any, is authorized to
enter into a substitution of liability agreement with the purchaser of the
Mortgaged Property pursuant to which the original Mortgagor is released from
liability and the purchaser of the Mortgaged Property is substituted as
Mortgagor and becomes liable under the Mortgage Note.
          Subsection 11.19 Satisfaction of Mortgages and Release of Mortgage
Files.
          Upon the payment in full of any Mortgage Loan, or the receipt by the
Servicer of a notification that payment in full will be escrowed in a manner
customary for such purposes, the Servicer will obtain the portion of the
Mortgage File that is in the possession of the Purchaser or its designee,
prepare and process any required satisfaction or release of the Mortgage and
notify the Purchaser in accordance with the provisions of this Agreement. The
Purchaser agrees to deliver to the Servicer (or cause to be delivered to the
Servicer) the original Mortgage Note for any Mortgage Loan not later than five
(5) Business Days following its receipt of a notice from the Servicer that such
a payment in full has been received or that a notification has been received
that such a payment in full shall be made. Such Mortgage Note shall be held by
the Servicer, in trust, for the purpose of canceling such Mortgage Note and
delivering the canceled Mortgage Note to the Mortgagor in a timely manner as and
to the extent provided under any applicable federal or state law.
          In the event the Servicer grants a satisfaction or release of a
Mortgage without having obtained payment in full of the indebtedness secured by
the Mortgage, the Servicer shall remit to the Purchaser the Stated Principal
Balance of the related Mortgage Loan by deposit thereof in the Custodial
Account. The Fidelity Bond shall insure the Servicer against any loss it may
sustain with respect to any Mortgage Loan not satisfied in accordance with the
procedures set forth herein.

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          Subsection 11.20 Servicer Shall Provide Access and Information as
Reasonably Required.
          The Servicer shall provide to the Purchaser, and for any Purchaser
insured by FDIC or NAIC, the supervisory agents and examiners of FDIC and OTS or
NAIC, access to any documentation regarding the Mortgage Loans which may be
required by applicable regulations. Such access shall be afforded without
charge, but only upon reasonable request, during normal business hours and at
the offices of the Servicer.
          In addition, the Servicer shall furnish upon request by the Purchaser,
during the term of this Agreement, such periodic, special or other reports or
information, whether or not provided for herein, as shall be necessary,
reasonable and appropriate with respect to the purposes of this Agreement and
applicable regulations. All such reports or information shall be provided by and
in accordance with all reasonable instructions and directions the Purchaser may
require. The Servicer agrees to execute and deliver all such instruments and
take all such action as the Purchaser, from time to time, may reasonably request
in order to effectuate the purposes and to carry out the terms of this
Agreement.
          Subsection 11.21 Inspections.
          The Servicer shall inspect the Mortgaged Property as often deemed
necessary by the Servicer to assure itself that the value of the Mortgaged
Property is being preserved. In addition, if any Mortgage Loan is more than
ninety (90) days delinquent, the Servicer shall, upon written request of the
Purchaser, inspect the Mortgaged Property and shall conduct subsequent
inspections in accordance with Customary Servicing Procedures or as may be
required by the primary mortgage guaranty insurer. The Servicer shall keep
written report of each such inspection and shall provide a copy of such
inspection to the Purchaser upon the request of the Purchaser.
          Subsection 11.22 Restoration of Mortgaged Property.
          The Servicer need not obtain the approval of the Purchaser prior to
releasing any Insurance Proceeds or Condemnation Proceeds to the Mortgagor to be
applied to the restoration or repair of the Mortgaged Property if such release
is in accordance with Customary Servicing Procedures. For claims greater than
$15,000, at a minimum, the Servicer shall comply with the following conditions
in connection with any such release of Insurance Proceeds or Condemnation
Proceeds:
(a) the Servicer shall receive satisfactory independent verification of
completion of repairs and issuance of any required approvals with respect
thereto;
(b) the Servicer shall take all steps necessary to preserve the priority of the
lien of the Mortgage, including, but not limited to requiring waivers with
respect to mechanics’ and materialmen’s liens;
(c) the Servicer shall verify that the Mortgage Loan is not in default; and

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(d) pending repairs or restoration, the Servicer shall place the Insurance
Proceeds or Condemnation Proceeds in the Escrow Account.
          If the Purchaser is named as an additional loss payee, the Servicer is
hereby empowered to endorse any loss draft issued in respect of such a claim in
the name of the Purchaser.
          Subsection 11.23 Fair Credit Reporting Act.
          The Servicer, in its capacity as servicer for each Mortgage Loan,
agrees to fully furnish, in accordance with the Fair Credit Reporting Act and
its implementing regulations, accurate and complete information (e.g., favorable
and unfavorable) on its borrower credit files to Equifax, Experian and Trans
Union Credit Information Company (three of the credit repositories), on a
monthly basis.
          SECTION 12. The Servicer.
          Subsection 12.01 Indemnification; Third Party Claims.
          (a) The Servicer agrees to indemnify and hold harmless the Purchaser
against any and all claims, losses, penalties, fines, forfeitures, legal fees
and related costs, judgments, and any other costs, fees and expenses that the
Purchaser may sustain in any way related to the failure of the Servicer to
service the Mortgage Loans in compliance with the terms of this Agreement.
          (b) The Servicer shall immediately notify the Purchaser if a claim is
made by a third party with respect to this Agreement or the Mortgage Loans, and
the Servicer shall assume (with the written consent of the Purchaser) the
defense of any such claim and pay all expenses in connection therewith,
including counsel fees. If the Servicer has assumed the defense of the
Purchaser, the Servicer shall provide the Purchaser with a written report of all
expenses and advances incurred by the Servicer pursuant to this Subsection 12.01
and the Purchaser shall promptly reimburse the Servicer for all amounts advanced
by it pursuant to the preceding sentence except when the claim in any way
relates to the failure of the Servicer to service the Mortgage Loans in
accordance with the terms of this Agreement.
          Subsection 12.02 Merger or Consolidation of the Servicer.
          The Servicer will keep in full effect its existence, rights and
franchises as a national banking association, and will obtain and preserve its
qualification to do business in each jurisdiction in which such qualification is
or shall be necessary to protect the validity and enforceability of this
Agreement or any of the Mortgage Loans and to perform its duties under this
Agreement.
          Any Person into which the Servicer may be merged or consolidated, or
any entity resulting from any merger, conversion or consolidation to which the
Servicer shall be a party, or any Person succeeding to substantially all of the
business of the Servicer (whether or not related to loan servicing), shall be
the successor of the Servicer hereunder, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.

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          Subsection 12.03 Limitation on Liability of the Servicer and Others.
          The duties and obligations of the Servicer shall be determined solely
by the express provisions of this Agreement, the Servicer shall not be liable
except for the performance of such duties and obligations as are specifically
set forth in this Agreement and no implied covenants or obligations shall be
read into this Agreement against the Servicer. Neither the Servicer nor any of
the directors, officers, employees or agents of the Servicer shall be under any
liability to the Purchaser for any action taken or for refraining from the
taking of any action in accordance with Customary Servicing Procedures and
otherwise in good faith pursuant to this Agreement or for errors in judgment;
provided, however, that this provision shall not protect the Servicer against
any liability resulting from any breach of any representation or warranty made
herein, or from any liability specifically imposed on the Servicer herein; and,
provided further, that this provision shall not protect the Servicer against any
liability that would otherwise be imposed by reason of the willful misfeasance,
bad faith or gross negligence in the performance of duties or by reason of
reckless disregard of the obligations or duties hereunder. The Servicer and any
director, officer, employee or agent of the Servicer may rely on any document of
any kind which it in good faith reasonably believes to be genuine and to have
been adopted or signed by the proper authorities respecting any matters arising
hereunder. Subject to the terms of Subsection 12.01, the Servicer shall have no
obligation to appear with respect to, prosecute or defend any legal action which
is not incidental to the Servicer’s duty to service the Mortgage Loans in
accordance with this Agreement.
          Subsection 12.04 Seller and Servicer Not to Resign.
          Neither the Seller nor the Servicer shall assign this Agreement or
resign from the obligations and duties hereby imposed on it except by mutual
consent of the Servicer or the Seller, as the case may be, and the Purchaser or
upon the determination that the Servicer’s duties hereunder are no longer
permissible under applicable law and such incapacity cannot be cured by the
Servicer. Any such determination permitting the unilateral resignation of the
Servicer shall be evidenced by an Opinion of Counsel to such effect delivered to
the Purchaser, which Opinion of Counsel shall be in form and substance
acceptable to the Purchaser. No such resignation or assignment shall become
effective until a successor has assumed the Servicer’s responsibilities and
obligations hereunder in accordance with Subsection 14.02.
          Subsection 12.05 Liability for Failure to Deliver Servicing Files.
          The Servicer shall have no liability for any failure to carry out its
servicing responsibilities hereunder which is directly caused by the failure of
a prior owner of the related Mortgage Loans to deliver to the Servicer the
Servicing Files (or portions thereof) necessary to service such Mortgage Loans
in material compliance with the Customary Servicing Procedures or this
Agreement.
          SECTION 13. Default.
          Subsection 13.01 Events of Default.
          In case one or more of the following Events of Default by the Servicer
shall occur and be continuing:

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(a) any failure by the Servicer to remit to the Purchaser any payment required
to be made under the terms of this Agreement which continues unremedied for a
period of two (2) Business Days after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Purchaser;
(b) failure by the Servicer to duly observe or perform, in any material respect,
any other covenants, obligations or agreements of the Servicer as set forth in
this Agreement which failure continues unremedied for a period of thirty
(30) days after the date on which written notice of such failure, requiring the
same to be remedied, shall have been given to the Servicer by the Purchaser;
(c) a decree or order of a court or agency or supervisory authority having
jurisdiction for the appointment of a conservator or receiver or liquidator in
any insolvency, bankruptcy, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Servicer and such decree or order
shall have remained in force, undischarged or unstayed for a period of sixty
(60) days;
(d) the Servicer shall consent to the appointment of a conservator or receiver
or liquidator in any insolvency, bankruptcy, readjustment of debt, marshalling
of assets and liabilities or similar proceedings of or relating to the Servicer
or relating to all or substantially all of the Servicer’s property;
(e) the Servicer shall admit in writing its inability to pay its debts as they
become due, file a petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of its creditors, or
voluntarily suspend payment of its obligations;
(f) the Servicer shall cease to be qualified to do business under the laws of
any state in which a Mortgaged Property is located, but only to the extent such
qualification is necessary to ensure the enforceability of each Mortgage Loan
and to perform the Servicer’s obligations under this Agreement; or
(g) the Servicer shall fail to meet the servicer eligibility qualifications of
Fannie Mae or the Servicer shall fail to meet the servicer eligibility
qualifications of Freddie Mac;
then, and in each and every such case, so long as an Event of Default shall not
have been remedied, the Purchaser, by notice in writing to the Servicer, may, in
addition to whatever rights the Purchaser may have at law or equity to damages,
including injunctive relief and specific performance, commence termination of
all the rights and obligations of the Servicer under this Agreement and in and
to the Mortgage Loans and the proceeds thereof. Upon receipt by the Servicer of
such written notice from the Purchaser stating that they intend to terminate the
Servicer as a result of such Event of Default, all authority and power of the
Servicer under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in the successor appointed pursuant to
Subsection 14.02. Upon written request from the Purchaser, the Servicer shall
prepare, execute and deliver to a successor any and all documents and other
instruments, place in such successor’s possession all Mortgage Files and do or
cause to be done all other acts or things necessary or appropriate to effect the
purposes of such notice of

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termination, including, but not limited to, the transfer and endorsement or
assignment of the Mortgage Loans and related documents to the successor at the
Servicer’s sole expense. The Servicer agrees to cooperate with the Purchaser and
such successor in effecting the termination of the Servicer’s responsibilities
and rights hereunder, including, without limitation, the transfer to such
successor for administration by it of all amounts which shall at the time be
credited by the Servicer to the Custodial Account or Escrow Account or
thereafter received with respect to the Mortgage Loans.
          Subsection 13.02 Waiver of Default.
          The Purchaser may waive any default by the Servicer in the performance
of its obligations hereunder and its consequences. Upon any waiver of a past
default, such default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been remedied for every purpose of this
Agreement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereto except to the extent expressly so waived.
          SECTION 14. Termination.
          Subsection 14.01 Termination.
          The respective obligations and responsibilities of the Servicer, as
servicer, shall terminate upon (a) the distribution to the Purchaser of the
final payment or liquidation with respect to the last Mortgage Loan (or advances
of same by the Servicer) or (b) the disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure with respect to the last Mortgage
Loan and the remittance of all funds due hereunder. Upon written request from
the Purchaser in connection with any such termination, the Servicer shall
prepare, execute and deliver, any and all documents and other instruments, place
in the Purchaser’s possession all Mortgage Files, and do or accomplish all other
acts or things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise, at the Purchaser’s sole
expense. The Servicer agrees to cooperate with the Purchaser and such successor
in effecting the termination of the Servicer’s responsibilities and rights
hereunder as servicer, including, without limitation, the transfer to such
successor for administration by it of all cash amounts which shall at the time
be credited by the Servicer to the Custodial Account or Escrow Account or
thereafter received with respect to the Mortgage Loans.
          Subsection 14.02 Successors to the Servicer.
          Prior to the termination of the Servicer’s responsibilities and duties
under this Agreement pursuant to Subsections 12.04, 13.01 or 14.01, the
Purchaser shall, (a) succeed to and assume all of the Servicer’s
responsibilities, rights, duties and obligations under this Agreement or (b)
appoint a successor which shall succeed to all rights and assume all of the
responsibilities, duties and liabilities of the Servicer under this Agreement
upon such termination. In connection with such appointment and assumption, the
Purchaser may make such arrangements for the compensation of such successor out
of payments on Mortgage Loans as it and such successor shall agree. In the event
that the Servicer’s duties, responsibilities and liabilities under this
Agreement shall be terminated pursuant to the aforementioned Subsections, the
Servicer shall discharge such duties and responsibilities during the period from
the date it acquires knowledge

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of such termination until the effective date thereof with the same degree of
diligence and prudence which it is obligated to exercise under this Agreement,
and shall take no action whatsoever that might impair or prejudice the rights or
financial condition of its successor. The resignation or removal of the Servicer
pursuant to the aforementioned Subsections shall not become effective until a
successor shall be appointed pursuant to this Subsection and shall in no event
relieve the Seller of the representations and warranties made pursuant to
Subsections 7.01 and 7.02 and the remedies available to the Purchaser under
Subsection 7.03, it being understood and agreed that the provisions of such
Subsections 7.01 and 7.02 shall be applicable to the Seller notwithstanding any
such resignation or termination of the Servicer, or the termination of this
Agreement.
          Any successor appointed as provided herein shall execute, acknowledge
and deliver to the Servicer and to the Purchaser an instrument accepting such
appointment, whereupon such successor shall become fully vested with all the
rights, powers, duties, responsibilities, obligations and liabilities of the
Servicer, with like effect as if originally named as a party to this Agreement.
Any termination or resignation of the Servicer or this Agreement pursuant to
Subsections 12.04, 13.01 or 14.01 shall not affect any claims that the Purchaser
may have against the Servicer arising prior to any such termination or
resignation.
          The Servicer shall promptly deliver to the successor the funds in the
Custodial Account and Escrow Account and all Mortgage Files and related
documents and statements held by it hereunder and the Servicer shall account for
all funds and shall execute and deliver such instruments and do such other
things as may reasonably be required to more fully and definitively vest in the
successor all such rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer.
          Upon a successor’s acceptance of appointment as such, the Servicer
shall notify by mail the Purchaser of such appointment.
          SECTION 15. Notices.
          All demands, notices and communications hereunder shall be in writing
and shall be deemed to have been duly given if mailed, by registered or
certified mail, return receipt requested, or, if by other means, when received
by the other party at the address as follows:

  (a)   if to the Purchaser:

RWT Holdings, Inc.
One Belvedere Place, Suite 360
Mill Valley, CA 94904
Attention: Laura J. Jeffery
Phone: (415) 380-2337
Facsimile: (415) 381-1773
    (b)   if to the Seller:

Bank of America, National Association

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      201 North Tryon Street
Charlotte, North Carolina 28255
Attention: Secondary Marketing Manager
    (c)   if to the Servicer:

Bank of America, National Association
101 East Main Street, Suite 400
Louisville, Kentucky 40232
Attention: Servicing Manager

or such other address as may hereafter be furnished to the other party by like
notice. Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt).
          SECTION 16. Severability Clause.
          Any part, provision, representation or warranty of this Agreement
which is prohibited or which is held to be void or unenforceable shall be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any part, provision,
representation or warranty of this Agreement which is prohibited or
unenforceable or is held to be void or unenforceable in any jurisdiction shall
be ineffective, as to such jurisdiction, to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction as to any Mortgage Loan
shall not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the parties hereto
waive any provision of law which prohibits or renders void or unenforceable any
provision hereof. If the invalidity of any part, provision, representation or
warranty of this Agreement shall deprive any party of the economic benefit
intended to be conferred by this Agreement, the parties shall negotiate, in
good-faith, to develop a structure the economic effect of which is nearly as
possible the same as the economic effect of this Agreement without regard to
such invalidity.
          SECTION 17. No Partnership.
          Nothing herein contained shall be deemed or construed to create a
co-partnership or joint venture between the parties hereto and the services of
the Servicer shall be rendered as an independent contractor and not as agent for
the Purchaser.
          SECTION 18. Counterparts.
          This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.

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          SECTION 19. Governing Law.
          EXCEPT TO THE EXTENT PREEMPTED BY FEDERAL LAW, THE AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICTS OF LAWS PROVISIONS OF NEW YORK OR ANY OTHER JURISDICTION.
          SECTION 20. Intention of the Parties.
          It is the intention of the parties that the Purchaser is purchasing,
and the Seller is selling, the Mortgage Loans and not a debt instrument of the
Seller or another security. Accordingly, the parties hereto each intend to treat
the transaction for federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. The Purchaser shall have the
right to review the Mortgage Loans and the related Mortgage Files to determine
the characteristics of the Mortgage Loans which shall affect the federal income
tax consequences of owning the Mortgage Loans and the Seller shall cooperate
with all reasonable requests made by the Purchaser in the course of such review.
          It is not the intention of the parties that such conveyances be deemed
a pledge thereof. However, in the event that, notwithstanding the intent of the
parties, such assets are held to be the property of the Seller or if for any
other reason this Agreement is held or deemed to create a security interest in
either such assets, then (a) this Agreement shall be deemed to be a security
agreement within the meaning of the Uniform Commercial Code of the State of New
York and (b) the conveyances provided for in this Agreement shall be deemed to
be an assignment and a grant by the Seller to the Purchaser of a security
interest in all of the assets transferred, whether now owned or hereafter
acquired.
          SECTION 21. Waivers.
          No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced.
          SECTION 22. Exhibits.
          The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.
          SECTION 23. General Interpretive Principles.
          For purposes of this Agreement, except as otherwise expressly provided
or unless the context otherwise requires:

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(a) the terms defined in this Agreement have the meanings assigned to them in
this Agreement and include the plural as well as the singular, and the use of
any gender herein shall be deemed to include the other gender;
(b) accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with generally accepted accounting principles;
(c) references herein to “Articles,” “Sections,” “Subsections,” “Paragraphs” and
other subdivisions without reference to a document are to designated Articles,
Sections, Subsections, Paragraphs and other subdivisions of this Agreement;
(d) reference to a Subsection without further reference to a Section is a
reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(e) the words “herein,” “hereof,” “hereunder” and other words of similar import
refer to this Agreement as a whole and not to any particular provision; and
(f) the term “include” or “including” shall mean without limitation by reason of
enumeration.
          SECTION 24. Reproduction of Documents.
          This Agreement and all documents relating thereto, including, without
limitation (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by any party at the closing and (c) financial
statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties hereto
agree that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party hereto
in the regular course of business, and that any enlargement, facsimile or
further reproduction of such reproduction shall likewise be admissible in
evidence.
          SECTION 25. Amendment.
          This Agreement may be amended from time to time by the Purchaser, the
Seller and the Servicer by written agreement signed by the parties hereto.
          SECTION 26. Confidentiality.
          Each of the Purchaser, the Seller and the Servicer shall employ proper
procedures and standards designed to maintain the confidential nature of the
terms of this Agreement, except to the extent (a) the disclosure of which is
reasonably believed by such party to be required in connection with regulatory
requirements or other legal requirements relating to its affairs; (b) disclosed
to any one or more of such party’s employees, officers, directors, agents,
attorneys

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or accountants who would have access to the contents of this Agreement and such
data and information in the normal course of the performance of such person’s
duties for such party, to the extent such party has procedures in effect to
inform such person of the confidential nature thereof; (c) that is disclosed in
a prospectus, prospectus supplement or private placement memorandum relating to
a Securitization Transaction of the Mortgage Loans by the Purchaser (or an
affiliate assignee thereof) or to any person in connection with the resale or
proposed resale of all or a portion of the Mortgage Loans by such party in
accordance with the terms of this Agreement; and (d) that is reasonably believed
by such party to be necessary for the enforcement of such party’s rights under
this Agreement.
     SECTION 27. Entire Agreement.
     This Agreement constitutes the entire agreement and understanding relating
to the subject matter hereof between the parties hereto and any prior oral or
written agreements between them shall be deemed to have merged herewith.
     SECTION 28. Further Agreements.
     The Seller, the Servicer and the Purchaser each agree to execute and
deliver to the other such reasonable and appropriate additional documents,
instruments or agreements as may be necessary or appropriate to effectuate the
purposes of this Agreement.
     SECTION 29. Successors and Assigns.
     This Agreement shall bind and inure to the benefit of and be enforceable by
the initial Purchaser, the Seller and the Servicer, and the respective
successors and assigns of the Purchaser, the Seller and the Servicer. The
initial Purchaser and any subsequent purchasers may assign this Agreement to any
Person to whom any Mortgage Loan is transferred pursuant to a sale or financing
upon prior written notice to the Servicer in accordance with the following
paragraph; provided, however, that except in connection with Securitizations, as
to which no such quantitative limitation shall apply, the Servicer shall not be
required to service the Mortgage Loans for more than three (3) Persons for
assignees of RWT Holdings, Inc. or its respective affiliates at any time and
shall not recognize any assignment of this Agreement to the extent that
following such assignment more than such number of Persons would be purchasers
hereunder. As used herein, the trust formed in connection with a Securitization
shall be deemed to constitute a single “Person.” Upon any such assignment and
written notice thereof to the Servicer, the Person to whom such assignment is
made shall succeed to all rights and obligations of the Purchaser under this
Agreement to the extent of the related Mortgage Loan or Mortgage Loans and this
Agreement, to the extent of the related Mortgage Loan or Mortgage Loans, shall
be deemed to be a separate and distinct agreement between the Servicer and such
purchaser, and a separate and distinct agreement between the Servicer and each
other purchaser to the extent of the other related Mortgage Loan or Mortgage
Loans.
     At least five (5) Business Days prior to the end of the month preceding the
date upon which the first remittance is to be made to an assignee of the
Purchaser, the Purchaser shall provide to the Servicer written notice of any
assignment setting forth: (a) the Servicer’s applicable Mortgage Loan
identifying number for each of the Mortgage Loans affected by such

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assignment; (b) the aggregate scheduled transfer balance of such Mortgage Loans;
and (c) the full name, address and wiring instructions of the assignee and the
name and telephone number of an individual representative for such assignee, to
whom the Servicer should: (i) send remittances; (ii) send any notices required
by or provided for in this Agreement; and (iii) deliver any legal documents
relating to the Mortgage Loans (including, but not limited to, contents of any
Mortgage File obtained after the effective date of any assignment).
     If the Purchaser has not provided the notice of assignment required by this
Section 29, the Servicer shall not be required to treat any other Person as a
“Purchaser” hereunder and may continue to treat the Purchaser which purports to
assign the Agreement as the “Purchaser” for all purposes of this Agreement.
     SECTION 30. Non-Solicitation.
     From and after the Closing Date, the Seller, the Servicer and any of their
respective affiliates hereby agrees that it will not take any action or permit
or cause any action to be taken by any of its agents or affiliates, or by any
independent contractors on its behalf, to personally, by telephone or mail,
solicit a Mortgagor under any Mortgage Loan for the purpose of refinancing a
Mortgage Loan, in whole or in part, without the prior written consent of the
Purchaser. It is understood and agreed that all rights and benefits relating to
the solicitation of any Mortgagors and the attendant rights, title and interest
in and to the list of such Mortgagors and data relating to their Mortgages
(including insurance renewal dates) shall be transferred to the Purchaser
pursuant hereto on the Closing Date and none of the Seller, the Servicer or any
of their respective affiliates shall take any action to undermine these rights
and benefits.
     Notwithstanding the foregoing, it is understood and agreed that the Seller,
the Servicer or any of their respective affiliates:
(a) may advertise its availability for handling refinancings of mortgages in its
portfolio, including the promotion of terms it has available for such
refinancings, through the sending of letters or promotional material, so long as
it does not specifically target Mortgagors and so long as such promotional
material either is sent to the mortgagors for all of the mortgages in the
A-quality servicing portfolio of the Seller, the Servicer and any of their
affiliates (those it owns as well as those serviced for others) or sent to all
of the mortgagors who have specific types of mortgages (such as FHA, VA,
conventional fixed-rate or conventional adjustable-rate, or sent to those
mortgagors whose mortgages fall within specific interest rate ranges;
(b) may provide pay-off information and otherwise cooperate with individual
mortgagors who contact it about prepaying their mortgages by advising them of
refinancing terms and streamlined origination arrangements that are available;
and
(c) may offer to refinance a Mortgage Loan made within thirty (30) days
following receipt by it of a pay-off request from the related Mortgagor.

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     Promotions undertaken by the Seller or the Servicer or by any affiliate of
the Seller or the Servicer which are directed to the general public at large
(including, without limitation, mass mailing based on commercially acquired
mailing lists, newspaper, radio and television advertisements), shall not
constitute solicitation under this Section 30.
     SECTION 31. Protection of Consumer Information.
     Each party agrees that it (i) shall comply with any applicable laws and
regulations regarding the privacy and security of Consumer Information,
(ii) shall not use Consumer Information in any manner inconsistent with any
applicable laws and regulations regarding the privacy and security of Consumer
Information, (iii) shall not disclose Consumer Information to third parties
except at the specific written direction of the Seller or the Servicer,
(iv) shall maintain adequate physical, technical and administrative safeguards
to protect Consumer Information from unauthorized access and (v) shall
immediately notify the Seller of any actual or suspected breach of the
confidentiality of Consumer Information.
     SECTION 32. Cooperation of the Company with a Reconstitution; Regulation AB
Compliance.
     The Seller acknowledges and the Purchaser agrees that with respect to some
or all of the Mortgage Loans, the Purchaser may effect either:
     (1) one or more Whole Loan Transfers; and
     (2) one or more Securitizations;
     provided, however, that no more than three (3) persons shall be assignees
of the Purchaser’s interest in this Agreement with respect to a given Mortgage
Loan Package.
     The Seller shall cooperate with the Purchaser in connection with any Whole
Loan Transfer contemplated by the Purchaser pursuant to this Section. In
connection therewith, the Purchaser shall deliver any Reconstitution Agreement
or other document related to the Whole Loan Transfer to the Seller at least
fifteen (15) days prior to such transfer and the Seller shall execute any
Reconstitution Agreement which contains servicing provisions substantially
similar to those herein or otherwise reasonably acceptable to the Purchaser and
the Seller and which restates the representations and warranties contained in
Subsection 7.01 as of the related Closing Date (except to the extent any such
representation or warranty is not accurate on such date) and Subsection 7.02
herein as of the Reconstitution Date. Any prospective assignees of the Purchaser
who have entered into a commitment to purchase any of the Mortgage Loans in a
Whole Loan Transfer may review and underwrite the Seller’s servicing and
origination operations, upon reasonable prior notice to the Seller, and the
Seller shall cooperate with such review and underwriting to the extent such
prospective assignees request information or documents that are available and
can be produced without unreasonable expense or effort. Subject to any
applicable laws, the Seller shall make the Mortgage Files related to the
Mortgage Loans held by the Seller available at the Seller’s principal operations
center for review by any such prospective assignees during normal business hours
upon reasonable prior notice to the Seller (in no event fewer than five
(5) Business Days’ prior notice). The Seller may, in its sole

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discretion, require that such prospective assignees sign a confidentiality
agreement with respect to such information disclosed to the prospective assignee
which is not available to the public at large and a release agreement with
respect to its activities on the Seller’s premises. The Purchaser hereby agrees
to reimburse the Seller for reasonable “out-of-pocket” expenses incurred by the
Seller that relate to such Whole Loan Transfer, including without limitation
reimbursement for the amount which reasonably reflects time and effort expended
by the Seller in connection therewith.
     In order to facilitate compliance with Regulation AB promulgated under the
Securities Act, the Servicer and the Purchaser agree to comply with the
provisions of the Regulation AB Compliance Addendum attached hereto as Addendum
I. All Mortgage Loans not sold or transferred pursuant to a Whole Loan Transfer
or Securitization shall be subject to this Agreement and shall continue to be
serviced in accordance with the terms of this Agreement and with respect thereto
this Agreement shall remain in full force and effect. It is understood and
agreed by the Purchaser and the Servicer that the right to effectuate such Whole
Loan Transfer or Securitization as contemplated by this Section 32 is limited to
the Purchaser.
[SIGNATURES ON FOLLOWING PAGE]

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     IN WITNESS WHEREOF, the parties have caused their names to be signed hereto
by their respective officers thereunto duly authorized on the date first above
written.
RWT HOLDINGS, INC.,
as Purchaser
By:                                                                
Name:
Title:
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Seller and as Servicer
By:                                                                
Name:
Title:
[Flow Mortgage Loan Sale and Servicing Agreement, dated July 1, 2006]

 

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EXHIBIT 1
MORTGAGE LOAN DOCUMENTS
With respect to each Mortgage Loan, the Mortgage Loan Documents shall consist of
the following:
     (a) the original Mortgage Note bearing all intervening endorsements,
endorsed in blank and signed in the name of the Seller by an officer thereof or,
if the original Mortgage Note has been lost or destroyed, a lost note affidavit;
(a) the original Assignment of Mortgage with assignee’s name left blank;
(b) the original of any guarantee executed in connection with the Mortgage Note;
(c) the original Mortgage with evidence of recording thereon, or if any such
mortgage has not been returned from the applicable recording office or has been
lost, or if such public recording office retains the original recorded mortgage,
a photocopy of such mortgage certified by the Seller to be a true and complete
copy of the original recorded mortgage;
(d) the originals of all assumption, modification, consolidation or extension
agreements, if any, with evidence of recording thereon;
(e) the originals of all intervening assignments of mortgage with evidence of
recording thereon, or if any such intervening assignment of mortgage has not
been returned from the applicable recording office or has been lost or if such
public recording office retains the original recorded assignments of mortgage, a
photocopy of such intervening assignment of mortgage, certified by the Seller to
be a true and complete copy of the original recorded intervening assignment of
mortgage;
(f) the original mortgagee title insurance policy including an Environmental
Protection Agency Endorsement and, with respect to any Adjustable Rate Mortgage
Loan, an adjustable-rate endorsement;
(g) the original of any security agreement, chattel mortgage or equivalent
document executed in connection with the Mortgage; and
(h) a copy of any applicable power of attorney.
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EXHIBIT 2
CONTENTS OF EACH MORTGAGE FILE
     With respect to each Mortgage Loan, the Mortgage File shall include each of
the following items, unless otherwise disclosed to the Purchaser on the data
tape, which shall be available for inspection by the Purchaser and which shall
be retained by the Servicer or delivered to the Purchaser:
          (a) Copies of the Mortgage Loan Documents.
(i) Residential loan application.
(j) Mortgage Loan closing statement.
(k) Verification of employment and income, if required.
(l) Verification of acceptable evidence of source and amount of down payment.
(m) Credit report on Mortgagor, in a form acceptable to either Fannie Mae or
Freddie Mac.
(n) Residential appraisal report.
(o) Photograph of the Mortgaged Property.
(p) Survey of the Mortgaged Property, unless a survey is not required by the
title insurer.
(q) Copy of each instrument necessary to complete identification of any
exception set forth in the exception schedule in the title policy, i.e., map or
plat, restrictions, easements, home owner association declarations, etc.
(r) Copies of all required disclosure statements.
(s) If applicable, termite report, structural engineer’s report, water
potability and septic certification.
(t) Sales contract, if applicable.
(u) The Primary Mortgage Insurance policy or certificate of insurance or
electronic notation of the existence of such policy, where required pursuant to
the Agreement.
(v) Evidence of electronic notation of the hazard insurance policy, and, if
required by law, evidence of the flood insurance policy.
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EXHIBIT 3
UNDERWRITING GUIDELINES
[ON FILE WITH THE PURCHASER]
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EXHIBIT 4
[Reserved]
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EXHIBIT 5
FORM OF MONTHLY REMITTANCE REPORT
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EXHIBIT 6
FORM OF TERM SHEET
          CLOSING DATE:                                         
     This Term Sheet (this “Term Sheet”), dated as of                      (the
“Closing Date”), confirms the sale by Bank of America, National Association (the
“Seller”) to RWT Holdings, Inc. (the “Purchaser”), and the purchase by the
Purchaser from the Seller, of the first lien residential mortgage loans on a
servicing retained basis described on the Mortgage Loan Schedule attached as
Schedule I hereto (the “Mortgage Loans”), pursuant to the terms of the Flow
Mortgage Loan Sale and Servicing Agreement (the “Flow Sale and Servicing
Agreement”), dated as of July 1, 2006, by and between the Purchaser and the
Seller. Capitalized terms that are used herein but are not defined herein shall
have the respective meanings set forth in the Flow Sale and Servicing Agreement.
     For good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the Seller does hereby bargain, sell, convey, assign and
transfer to Purchaser without recourse, except as provided in the Flow Sale and
Servicing Agreement, and on a servicing retained basis, all right, title and
interest of the Seller in and to each of the Mortgage Loans, together with all
documents maintained as part of the related Mortgage Files, all Mortgaged
Properties which secure any Mortgage Loan but are acquired by foreclosure, deed
in lieu of foreclosure after the Cut-off Date or otherwise, all payments of
principal and interest received on the Mortgage Loans after the Cut-off Date,
all other unscheduled collections collected in respect of the Mortgage Loans
after the Cut-off Date, and all proceeds of the foregoing, subject, however, to
the rights of the Seller under the Flow Sale and Servicing Agreement.
     The Seller has delivered to the Purchaser or its designee prior to the date
hereof the documents with respect to each Mortgage Loan required to be delivered
under the Flow Sale and Servicing Agreement.
     For purposes of the Mortgage Loans sold pursuant to this Term Sheet,
certain terms shall be as set forth below:

                 
Stated Principal Balance:
    $    
 
   
Closing Date:
         
 
   
Transfer Date:
         
 
   
Cut-off Date:
         
 
   
Purchase Price Percentage: 
                                                %    
Servicing Fee Rate:
                                                %    

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     In WITNESS WHEREOF, the parties hereto, by the hands of their duly
authorized officers, execute this Term Sheet as of the Closing Date referred to
above.

                  RWT HOLDINGS, INC.       BANK OF AMERICA, NATIONAL ASSOCIATION
as Purchaser       as Seller
 
               
By:
          By:    
 
               
Name:
          Name:    
 
               
Its:
          Its:    
 
               

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ADDENDUM I
REGULATION AB COMPLIANCE ADDENDUM
TO FLOW SALE AND SERVICING AGREEMENT
(Servicing-retained)
     SECTION 1. DEFINED TERMS
     Capitalized terms used but not defined herein shall have the meanings
assigned to such terms in the Agreement. The following terms shall have the
meanings set forth below, unless the context clearly indicates otherwise:
     Commission: The United States Securities and Exchange Commission.
     Company Information: As defined in Section 2.07(a).
     Depositor: The depositor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
     Exchange Act: The Securities Exchange Act of 1934, as amended.
     Master Servicer: With respect to any Securitization Transaction, the
“master servicer,” if any, identified in the related transaction documents.
     Qualified Correspondent: Any Person from which the Company purchased
Mortgage Loans, provided that this term shall not include the Purchaser or an
affiliate of the Purchaser and provided further that the following conditions
are satisfied: (i) such Mortgage Loans were originated pursuant to an agreement
between the Company and such Person that contemplated that such Person would
underwrite mortgage loans from time to time, for sale to the Company, in
accordance with underwriting guidelines designated by the Company (“Designated
Guidelines”) or guidelines that do not vary materially from such Designated
Guidelines; (ii) such Mortgage Loans were in fact underwritten as described in
clause (i) above and were acquired by the Company within 180 days after
origination; (iii) either (x) the Designated Guidelines were, at the time such
Mortgage Loans were originated, used by the Company in origination of mortgage
loans of the same type as the Mortgage Loans for the Company’s own account or
(y) the Designated Guidelines were, at the time such Mortgage Loans were
underwritten, designated by the Company on a consistent basis for use by lenders
in originating mortgage loans to be purchased by the Company; and (iv) the
Company employed, at the time such Mortgage Loans were acquired by the Company,
pre-purchase or post-purchase quality assurance procedures (which may involve,
among other things, review of a sample of mortgage loans purchased during a
particular time period or through particular channels) designed to ensure that
Persons from which it purchased mortgage loans properly applied the underwriting
criteria designated by the Company.

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     Reconstitution Agreement: The agreement or agreements entered into by the
Company and the Purchaser and/or certain third parties on the Reconstitution
Date or Dates with respect to any or all of the Mortgage Loans serviced
hereunder, in connection with a Whole Loan Transfer or Securitization
Transaction.
     Regulation AB: Subpart 229.1100 — Asset Backed Securities (Rgulation AB),
17 C.F.R. §§229.1100-229.1123, as such may be amended from time to time, and
subject to such clarification and interpretation as have been provided by the
Commission in the adopting release (Asset-Backed Securities, Securities Act
Releast No. 33-8518, 70 Fed. Reg. 1,505, 1,531 (Jan. 7, 2005)) or by the staff
of the Commission, or as may be provided by the Commission or its staff from
time to time.
     Securities Act: The Securities Act of 1933, as amended.
     Securitization Transaction: Any transaction involving either (1) a sale or
other transfer of some or all of the Mortgage Loans directly or indirectly by
the Purchaser to an issuing entity in connection with an issuance of publicly
offered or privately placed, rated or unrated mortgage-backed securities or
(2) an issuance of publicly offered or privately placed, rated or unrated
securities, the payments on which are determined primarily by reference to one
or more portfolios of residential mortgage loans consisting, in whole or in
part, of some or all of the Mortgage Loans.
     Servicer: As defined in Section 2.03(c).
     Servicing Criteria: The “servicing criteria” set forth in Item 1122(d) of
Regulation AB for which the Company is responsible in its capacity as Servicer
as identified on Exhibit B hereto, provided that such Exhibit B may be amended
from time to time to reflect changes in Regulation AB.
     Sponsor: With respect to any Securitization Transaction, the Person
identified in writing to the Company by the Purchaser as sponsor for such
Securitization Transaction.
     Static Pool Information: Static pool information as described in
Item 1l05(a)(l)-(3) and 1105(c) of Regulation AB.
     Subcontractor: Any vendor, subcontractor or other Person that is not
responsible for the overall servicing (as “servicing” is commonly understood by
participants in the mortgage-backed securities market) of Mortgage Loans but
performs one or more discrete functions identified in Item l122(d) of
Regulation AB with respect to Mortgage Loans under the direction or authority of
the Company or a Subservicer, provided that this term shall not include the
Purchaser, an affiliate of the Purchaser or originators of Mortgage Loans
acquired by the Company from the Purchaser or an affiliate of the Purchaser.
     Subservicer: Any Person that services Mortgage Loans on behalf of the
Company or any Subservicer and is responsible for the performance (whether
directly or through Subservicers or Subcontractors) of a substantial portion of
the material servicing functions identified in Item 1122(d) of Regulation AB
that are required to be performed by the Company under this

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Agreement or any Reconstitution Agreement, provided that this term shall not
include the Purchaser, an affiliate of the Purchaser or originators of Mortgage
Loans acquired by the Company from the Purchaser or an affiliate of the
Purchaser.
     Third-Party Originator: Each Person, other than a Qualified Correspondent,
that originated Mortgage Loans acquired by the Company, provided that this term
shall not include originators of Mortgage Loans acquired by the Company from the
Purchaser or an affiliate of the Purchaser.
     Whole Loan Transfer: Any sale or transfer of some or all of the Mortgage
Loans (including an Agency Transfer), other than a Securitization Transaction.
     SECTION 2. COMPLIANCE WITH REGULATION AB
     Subsection 2.01 Intent of the Parties; Reasonableness.
     The Purchaser and the Company acknowledge and agree that the purpose of
this Reg AB Addendum is to facilitate compliance by the Purchaser and any
Depositor with the provisions of Regulation AB and related rules and regulations
of the Commission and that the provisions of this Reg AB Addendum shall be
applicable to all Mortgage Loans included in a Securitization Transaction
closing on or after January 1, 2006, regardless whether the Mortgage Loans were
purchased by the Purchaser from the Company prior to the date hereof. Although
Regulation AB is applicable by its terms only to offerings of asset-backed
securities that are registered under the Securities Act, the Company
acknowledges that investors in privately offered securities may require that the
Purchaser or any Depositor provide comparable disclosure in unregistered
offerings. References in this Reg AB Addendum to compliance with Regulation AB
include provision of comparable disclosure in private offerings.
     Neither the Purchaser nor any Depositor shall exercise its right to request
delivery of information or other performance under these provisions other than
in good faith, or for purposes other than compliance with the Securities Act,
the Exchange Act and the rules and regulations of the Commission thereunder (or
the provision in a private offering of disclosure comparable to that required
under the Securities Act). The Company acknowledges that interpretations of the
requirements of Regulation AB may change over time, whether due to interpretive
guidance provided by the Commission or its staff, consensus among participants
in the asset-backed securities markets, advice of counsel, or otherwise, and
agrees to comply with reasonable requests made by the Purchaser, any Master
Servicer or any Depositor in good faith for delivery of information under these
provisions on the basis of evolving interpretations of Regulation AB. In
connection with any Securitization Transaction, the Company shall cooperate
fully with the Purchaser and any Master Servicer to deliver to the Purchaser
(including any of its assignees or designees) and one of any Master Servicer or
any Depositor (as requested), any and all statements, reports, certifications,
records and any other information necessary in the good faith determination of
the Purchaser or any Depositor to permit the Purchaser, such Master Servicer or
such Depositor to comply with the provisions of Regulation AB, together with
such disclosures relating to the Company, any Subservicer, any Third-Party
Originator and the Mortgage Loans, or the servicing of the Mortgage Loans,
reasonably believed by the Purchaser, the Master Servicer or any Depositor to be
necessary in order to effect such compliance.

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     The Purchaser and the Company also acknowledge and agree that
Section 2.02(a)(i)-(v), Section 2.03(c), (e) and (f), Section 2.04, Section 2.05
and Section 2.06 of this Reg AB Addendum shall only be applicable with respect
to any Mortgage Loan if the Company (or Subservicer, if any) services such
Mortgage Loan for a period following the closing date of a related
Securitization Transaction.
     For purposes of this Reg AB Addendum, the term “Purchaser” shall refer to
RWT Holdings, Inc. and its successors in interest and assigns. In addition, any
notice or request that must be “in writing” or “written” may be made by
electronic mail.
     Subsection 2.02 Additional Representations and Warranties of the Company.
     (a) The Company shall be deemed to represent to the Purchaser, to any
Master Servicer and to any Depositor, as of the date on which information is
first provided to the Purchaser, any Master Servicer or any Depositor under
Section 2.03 that, except as disclosed in writing to the Purchaser, such Master
Servicer or such Depositor prior to such date: (i) the Company is not aware and
has not received notice that any default, early amortization or other
performance triggering event with respect to the Company has occurred as to any
other securitization due to any act or failure to act of the Company; (ii) the
Company has not been terminated as servicer in a residential mortgage loan
securitization, either due to a servicing default or to application of a
servicing performance test or trigger; (iii) no material noncompliance with the
Servicing Criteria with respect to other securitizations of residential mortgage
loans involving the Company as servicer has been disclosed or reported by the
Company; (iv) no material changes to the Company’s policies or procedures with
respect to the servicing function it will perform under this Agreement and any
Reconstitution Agreement for mortgage loans of a type similar to the Mortgage
Loans have occurred during the three-year period immediately preceding the
related Securitization Transaction; (v) there are no aspects of the Company’s
financial condition that are reasonably expected to have a material adverse
effect on the performance by the Company of its servicing obligations under this
Agreement or any Reconstitution Agreement; (vi) there are no material legal or
governmental proceedings pending (or known to be contemplated) against the
Company, any Subservicer or any Third-Party Originator; and (vii) there are no
affiliations, relationships or transactions relating to the Company, any
Subservicer or any Third-Party Originator with respect to any Securitization
Transaction and any party thereto identified in writing to the Company by the
related Depositor of a type described in Item 1119 of Regulation AB.
     (b) If so requested in writing by the Purchaser, any Master Servicer or any
Depositor on any date following the date on which information is first provided
to the Purchaser, any Master Servicer or any Depositor under Section 2.03, the
Company shall use its best efforts to confirm in writing within five
(5) Business Days, but in no event later than ten (10) Business Days, following
such request the accuracy of the representations and warranties set forth in
paragraph (a) of this Section or, if any such representation and warranty is not
accurate as of the date of such request, provide within five (5) Business Days,
but in no event later than ten (10) Business Days, reasonably adequate
disclosure of the pertinent facts, in writing, to the requesting party.

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     Subsection 2.03 Information to Be Provided by the Company.
     In connection with any Securitization Transaction, the Company shall use
its best efforts to (i) within five (5) Business Days, but in no event later
than ten (10) Business Days, following written request by the Purchaser or any
Depositor, provide to the Purchaser and such Depositor (or, as applicable, cause
each Third-Party Originator and each Subservicer to provide), in writing and in
form and substance reasonably satisfactory to the Purchaser and such Depositor,
the information and materials specified in paragraphs (a), (b), (c) and (f) of
this Section, and (ii) as promptly as practicable following notice to or
discovery by the Company, provide to the Purchaser and any Depositor (in writing
and in form and substance reasonably satisfactory to the Purchaser and such
Depositor) the information specified in paragraph (d) of this Section.
     (a) If so requested in writing by the Purchaser or any Depositor, the
Company shall provide such information regarding (i) the Company, as originator
of the Mortgage Loans (including as an acquirer of Mortgage Loans from a
Qualified Correspondent), or (ii) each Third-Party Originator, and (iii) as
applicable, each Subservicer, as is requested for the purpose of compliance with
Items 1103(a)(l), 1105, 1110, 1117 and 1119 of Regulation AB. Such information
shall include, at a minimum:
     (A) the originator’s form of organization;
     (B) a description of the originator’s origination program and how long the
originator has been engaged in originating residential mortgage loans, which
description shall include a discussion of the originator’s experience in
originating mortgage loans of a similar type as the Mortgage Loans; information
regarding the size and composition of the originator’s origination portfolio;
and information that may be material, in the good faith judgment of the
Purchaser or any Depositor, to an analysis of the performance of the Mortgage
Loans, including the originators’ credit-granting or underwriting criteria for
mortgage loans of similar type(s) as the Mortgage Loans and such other
information as the Purchaser or any Depositor may reasonably request for the
purpose of compliance with Item 1110(b)(2) of Regulation AB;
     (C) a description of any legal or governmental proceedings pending (or
known to be contemplated) against the Company, each Third-Party Originator and
each Subservicer that would be material to securityholders; and
     (D) a description of any affiliation or relationship between the Company,
each Third-Party Originator, each Subservicer and any of the following parties
to a Securitization Transaction, as such parties are identified to the Company
by the Purchaser or any Depositor in writing in advance of such Securitization
Transaction:

  (1)   the sponsor;     (2)   the depositor;     (3)   the issuing entity;    
(4)   any servicer;     (5)   any trustee;     (6)   any originator;     (7)  
any significant obligor;     (8)   any enhancement or support provider; and

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  (9)   any other material transaction party.

     (b) If so requested in writing by the Purchaser or any Depositor, the
Company shall provide (or, as applicable, cause each Third-Party Originator to
provide) Static Pool Information solely with respect to securitized pools of
mortgage loans (of a similar type as the Mortgage Loans, as reasonably
identified by the Purchaser as provided below) that were included in
securitizations that closed during the five (5) years preceding the closing date
of the related Securitization Transaction and for which Banc of America Mortgage
Securities, Inc. was the depositor. Such Static Pool Information shall be
prepared by the Company (or Third-Party Originator) on the basis of its
reasonable, good faith interpretation of the requirements of Item 1105(a)(3) of
Regulation AB. To the extent that there is reasonably available to the Company
(or Third-Party Originator) Static Pool Information with respect to more than
one mortgage loan type, the Purchaser or any Depositor shall be entitled to
specify whether some or all of such information shall be provided pursuant to
this paragraph. The content of such Static Pool Information may be in the form
customarily provided by the Company, and need not be customized for the
Purchaser or any Depositor. Such Static Pool Information for each prior
securitized pool shall be presented in increments no less frequently than
quarterly over the life of the mortgage loans included in such prior securitized
pool. The most recent periodic increment must be as of a date no later than
135 days prior to the date of the prospectus or other offering document in which
the Static Pool Information is to be included or incorporated by reference. The
Static Pool Information shall be provided in an electronic format that provides
a permanent record of the information provided, such as a portable document
format (pdf) file, or other such electronic format reasonably required by the
Purchaser or the Depositor, as applicable.
     Promptly following notice or discovery of a material error in Static Pool
Information provided pursuant to the immediately preceding paragraph (including
an omission to include therein information required to be provided pursuant to
such paragraph) during the applicable offering period for the securities, the
Company shall provide corrected Static Pool Information to the Purchaser or any
Depositor, as applicable, in the same format in which Static Pool Information
was previously provided to such party by the Company.
     If so requested in writing by the Purchaser or any Depositor, the Company
shall provide (or, as applicable, cause each Third-Party Originator to provide),
at the expense of the requesting party (to the extent of any additional
incremental expense associated with delivery pursuant to this Reg AB Addendum),
such statements and agreed-upon procedures letters of certified public
accountants reasonably acceptable to the Purchaser or Depositor, as applicable,
pertaining to Static Pool Information relating to securitizations closed on or
after January 1, 2006, as the Purchaser or such Depositor shall reasonably
request. Such statements and letters shall be addressed to and be for the
benefit of such parties as the Purchaser or such Depositor shall designate,
which may include, by way of example, any Sponsor, any Depositor and any broker
dealer acting as underwriter, placement agent or initial purchaser with respect
to a Securitization Transaction. Any such statement or letter may take the form
of a standard, generally applicable document accompanied by a reliance letter
authorizing reliance by the addressees designated by the Purchaser or such
Depositor.

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     (c) If so requested in writing by the Purchaser or any Depositor, the
Company shall provide such information regarding the Company, as servicer of the
Mortgage Loans, and each Subservicer (each of the Company and each Subservicer,
for purposes of this paragraph, a “Servicer”), as is requested for the purpose
of compliance with Item 1108, 1117 and 1119 of Regulation AB. Such information
shall include, at a minimum:
     (A) the Servicer’s form of organization;
     (B) a description of how long the Servicer has been servicing residential
mortgage loans; a general discussion of the Servicer’s experience in servicing
assets of any type as well as a more detailed discussion of the Servicer’s
experience in, and procedures for, the servicing function it will perform under
the Agreement and any Reconstitution Agreements; information regarding the size,
composition and growth of the Servicer’s portfolio of residential mortgage loans
of a type similar to the Mortgage Loans and information on factors related to
the Servicer that may be material, in the good faith judgment of the Purchaser
or any Depositor, to any analysis of the servicing of the Mortgage Loans or the
related asset-backed securities, as applicable, including, without limitation:
     (1) whether any prior securitizations of mortgage loans of a type similar
to the Mortgage Loans involving the Servicer have defaulted or experienced an
early amortization or other performance triggering event because of servicing by
the Servicer during the three-year period immediately preceding the related
Securitization Transaction;
     (2) the extent of outsourcing the Servicer utilizes;
     (3) whether there has been previous disclosure of material noncompliance
with the applicable servicing criteria with respect to other securitizations of
residential mortgage loans involving the Servicer as a servicer during the
three-year period immediately preceding the related Securitization Transaction;
     (4) whether the Servicer has been terminated as servicer in a residential
mortgage loan securitization, either due to a servicing default or to
application of a servicing performance test or trigger; and
     (5) such other information as the Purchaser or any Depositor may reasonably
request for the purpose of compliance with Item 1108(b)(2) of Regulation AB;
     (C) a description of any material changes during the three-year period
immediately preceding the related Securitization Transaction to the Servicer’s
policies or procedures with respect to the servicing function it will perform
under the Agreement and any Reconstitution Agreements for mortgage loans of a
type similar to the Mortgage Loans;
     (D) information regarding the Servicer’s financial condition, to the extent
that there is a material risk that an adverse financial event or circumstance
involving the Servicer could have a material adverse effect on the performance
by the Company of its servicing obligations under the Agreement or any
Reconstitution Agreement;

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     (E) information regarding advances made by the Servicer on the Mortgage
Loans and the Servicer’s overall servicing portfolio of residential mortgage
loans for the three-year period immediately preceding the related Securitization
Transaction, which may be limited to a statement by an authorized officer of the
Servicer to the effect that the Servicer has made all advances required to be
made on residential mortgage loans serviced by it during such period, or, if
such statement would not be accurate, information regarding the percentage and
type of advances not made as required, and the reasons for such failure to
advance;
     (F) a description of the Servicer’s processes and procedures designed to
address any special or unique factors involved in servicing loans of a similar
type as the Mortgage Loans;
     (G) a description of the Servicer’s processes for handling delinquencies,
losses, bankruptcies and recoveries, such as through liquidation of mortgaged
properties, sale of defaulted mortgage loans or workouts; and
     (H) information as to how the Servicer defines or determines delinquencies
and charge-offs, including the effect of any grace period, re-aging,
restructuring, partial payments considered current or other practices with
respect to delinquency and loss experience.
     (I) a description of any legal or governmental proceedings pending (or
known to be contemplated) against the Servicer that would be material to
securityholders; and
     (J) a description of any affiliation or relationship between the Servicer
and any of the following parties to a Securitization Transaction, as such
parties are identified to the Servicer by the Purchaser or any Depositor in
writing in advance of a Securitization Transaction.

  (1)   the sponsor;     (2)   the depositor;     (3)   the issuing entity;    
(4)   any servicer;     (5)   any trustee;     (6)   any originator;     (7)  
any significant obligor;     (8)   any enhancement or support provider; and    
(9)   any other material transaction party.

     (d) For the purpose of satisfying its reporting obligation under the
Exchange Act with respect to any class of asset-backed securities, for so long
as the Depositor is required to file reports under the Exchange Act with respect
to a Securitization Transaction, the Company shall (or shall cause each
Subservicer and Third-Party Originator to) (i) provide prompt notice to the
Purchaser, any Master Servicer and any Depositor in writing of (A) any
litigation or governmental proceedings pending against the Company, any
Subservicer or any Third-Party

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Originator that would be material to securityholders and (B) any affiliations or
relationships that develop following the closing date of a Securitization
Transaction between the Company, any Subservicer or any Third-Party Originator
and any of the parties specified in clause (D) of paragraph (a) of this Section
(and any other parties identified in writing by the requesting party) with
respect to such Securitization Transaction, but only to the extent that such
affiliations or relationships do not include the Purchaser, Depositor or any of
their respective affiliates as a party, (C) any Event of Default of which it is
aware or has received notice under the terms of the Agreement or any
Reconstitution Agreement, (D) any merger or consolidation where the Company is
not the surviving entity or sale of substantially all of the assets of the
Company, and (E) the Company’s entry into an agreement with a Subservicer to
perform or assist in the performance of any of the Company’s obligations under
the Agreement or any Reconstitution Agreement and (ii) provide to the Purchaser
and any Depositor a description of such proceedings, affiliations or
relationships.
     (e) As a condition to the succession to the Company or any Subservicer as
servicer or subservicer under the Agreement or any Reconstitution Agreement by
any Person (i) into which the Company or such Subservicer may be merged or
consolidated, or (ii) which may be appointed as a successor to the Company or
any Subservicer, the Company shall provide to the Purchaser, any Master Servicer
and any Depositor, at least 15 calendar days prior to the effective date of such
succession or appointment, (x) written notice to the Purchaser and any Depositor
of such succession or appointment and (y) in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, all information
reasonably requested in writing by the Purchaser or any Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect to
any class of asset-backed securities.
     (f) In addition to such information as the Company, as servicer, is
obligated to provide pursuant to other provisions of the Agreement, not later
than ten (10) days prior to the deadline for the filing of any distribution
report on Form 10-D in respect of any Securitization Transaction that includes
any of the Mortgage Loans serviced by the Company or any Subservicer, the
Company or such Subservicer, as applicable, shall, to the extent the Company or
such Subservicer has knowledge, provide to the party responsible for filing such
report (including, if applicable, the Master Servicer) notice of the occurrence
of any of the following events along with all information, data and materials
related thereto and reasonably available to it as may be required to be included
in the related distribution report on Form 10-D (as specified in the provisions
of Regulation AB referenced below):
     (i) any modifications, extensions or waivers of pool asset terms, fees,
penalties or payments during the distribution period or that have cumulatively
become material over time (Item 1121(a)(11) of Regulation AB) that would be
material to the securityholders;
     (ii) breaches of pool asset representations or warranties or transaction
covenants (Item 1121(a)(12) of Regulation AB) that would be material to the
securityholders; and
     (iii) information regarding new asset-backed securities issuances backed by
the same pool assets, any pool asset changes (such as additions, substitutions
or repurchases),

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and any changes in origination, underwriting or other criteria for acquisition
or selection of pool assets (Item 1121(a)(14) of Regulation AB) that would be
material to the securityholders.
     (g) The Company shall provide to the Purchaser, any Master Servicer and any
Depositor, upon written request, evidence of the authorization of the person
signing any certification or statement, copies of Fidelity Bond Insurance and
Errors and Omissions Insurance policy evidence, publicly available financial
information and reports, and, to the extent material to securityholders, such
other information related to the Company or any Subservicer of the Company’s or
such Subservicer’s performance hereunder.
     Subsection 2.04 Servicer Compliance Statement.
     On or before March 5th of each calendar year when the Depositor is required
to file reports under the Exchange Act with respect to the related
Securitization Transaction, commencing in 2007, the Company shall deliver to the
Purchaser and any Master Servicer, or any Depositor if a Master Servicer has not
been identified for the related Securitization Transaction, a statement of
compliance addressed to such parties and signed by an authorized officer of the
Company, to the effect that (i) a review of the Company’s activities during the
immediately preceding calendar year (or applicable portion thereof) and of its
performance under the Agreement and any applicable Reconstitution Agreement
during such period has been made under such officer’s supervision, and (ii) to
the best of such officers’ knowledge, based on such review, the Company has
fulfilled all of its obligations under the Agreement and any applicable
Reconstitution Agreement in all material respects throughout such calendar year
(or applicable portion thereof) or, if there has been a failure to fulfill any
such obligation in any material respect, specifically identifying each such
failure known to such officer and the nature and the status thereof.
     Subsection 2.05 Report on Assessment of Compliance and Attestation.
     (a) On or before March 5th of each calendar year when the Depositor is
required to file reports under the Exchange Act with respect to the related
Securitization Transaction, commencing in 2007, the Company shall:
     (i) deliver to the Purchaser and any Master Servicer, or any Depositor if a
Master Servicer has not been identified for the related Securitization
Transaction, a report (in form and substance reasonably satisfactory to such
parties) regarding the Company’s assessment of compliance with the Servicing
Criteria during the immediately preceding calendar year, as required under
Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such
report shall be addressed to such parties and signed by an authorized officer of
the Company, and shall address each of the “Applicable Servicing Criteria”
specified on Exhibit B hereto;
     (ii) deliver to the Purchaser and any Master Servicer, or any Depositor if
a Master Servicer has not been identified for the related Securitization
Transaction, a report of a registered public accounting firm reasonably
acceptable to such parties that attests to, and reports on, the assessment of
compliance made by the Company and delivered pursuant to the preceding
paragraph. Such attestation shall be in accordance with Rules

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1  02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act and the
Exchange Act;
     (iii) cause each Subservicer, and each Subcontractor determined by the
Company pursuant to Section 2.06(b) to be “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB, to deliver to the
Purchaser and any Master Servicer, or any Depositor if a Master Servicer has not
been identified for the related Securitization Transaction, an assessment of
compliance and accountants’ attestation as and when provided in paragraphs
(a) and (b) of this Section; and
     (iv) deliver, and cause each Subservicer, and each Subcontractor determined
by the Company pursuant to Section 2.06(b) to be “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB, to deliver, to the
Purchaser and any Master Servicer, or any Depositor if a Master Servicer has not
been identified for the related Securitization Transaction, and any other Person
that will be responsible for signing the certification (a “Sarbanes
Certification”) required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act
(pursuant to Section 302 of the Sarbanes-Oxley Act of 2002) on behalf of an
asset-backed issuer with respect to a Securitization Transaction a
certification, signed by the appropriate officer of the Company, in the form
attached hereto as Exhibit A.
     The Company acknowledges that the parties identified in clause (a)(iv)
above may rely on the certification provided by the Company pursuant to such
clause in signing a Sarbanes Certification and filing such with the Commission.
Neither the Purchaser nor any Depositor will request delivery of a certification
under clause (a)(iv) above unless a Depositor is required under the Exchange Act
to file an annual report on Form 10-K with respect to an issuing entity whose
asset pool includes Mortgage Loans.
     (b) Each assessment of compliance provided by a Subservicer pursuant to
Section 2.05(a)(iii) shall address each of the Servicing Criteria specified on
substantially Exhibit B hereto or, in the case of a Subservicer subsequently
appointed as such, on or prior to the date of such appointment. An assessment of
compliance provided by a Subcontractor pursuant to Section 2.05(a)(iii) need not
address any elements of the Servicing Criteria other than those specified by the
Company pursuant to Section 2.06.
     Subsection 2.06 Use of Subservicers and Subcontractors.
     The Company shall not hire or otherwise utilize the services of any
Subservicer to fulfill any of the obligations of the Company as servicer under
the Agreement or any Reconstitution Agreement unless the Company complies with
the provisions of paragraph (a) of this Section. The Company shall not hire or
otherwise utilize the services of any Subcontractor, and shall not authorize any
Subservicer to hire or otherwise utilize the services of any Subcontractor, to
fulfill any of the obligations of the Company as servicer under the Agreement or
any Reconstitution Agreement unless the Company complies with the provisions of
paragraph (b) of this Section.
     (a) It shall not be necessary for the Company to seek the consent of the
Purchaser, any Master Servicer or any Depositor to the utilization of any
Subservicer. The Company shall

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cause any Subservicer used by the Company (or by any Subservicer) for the
benefit of the Purchaser and any Depositor to comply with the provisions of this
Section and with Sections 2.02, 2.03(c), (e), (f) and (g), 2.04, 2.05 and 2.07
of this Reg AB Addendum to the same extent as if such Subservicer were the
Company, and to provide the information required with respect to such
Subservicer under Section 2.03(d) of this Reg AB Addendum. The Company shall be
responsible for obtaining from each Subservicer and delivering to the Purchaser
and any Depositor any servicer compliance statement required to be delivered by
such Subservicer under Section 2.04, any assessment of compliance and
attestation required to be delivered by such Subservicer under Section 2.05 and
any certification required to be delivered to the Person that will be
responsible for signing the Sarbanes Certification under Section 2.05 as and
when required to be delivered.
     (b) It shall not be necessary for the Company to seek the consent of the
Purchaser, any Master Servicer or any Depositor to the utilization of any
Subcontractor. The Company shall promptly upon written request provide to the
Purchaser and any Master Servicer, or any Depositor (or any designee of the
Depositor, such as an administrator) if a Master Servicer has not been
identified for the related Securitization Transaction, a written description (in
form and substance reasonably satisfactory to such parties) of the role and
function of each Subcontractor utilized by the Company or any Subservicer,
specifying (i) the identity of each such Subcontractor, (ii) which (if any) of
such Subcontractors are “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB and (iii) which elements of the Servicing
Criteria will be addressed in assessments of compliance provided by each
Subcontractor identified pursuant to clause (ii) of this paragraph.
     (c) As a condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, the Company shall cause any such Subcontractor used by the
Company (or by any Subservicer) for the benefit of the Purchaser and any
Depositor to comply with the provisions of Sections 2.05 and 2.07 of this Reg AB
Addendum to the same extent as if such Subcontractor were the Company. The
Company shall be responsible for obtaining from each Subcontractor and
delivering to the Purchaser and any Depositor any assessment of compliance and
attestation required to be delivered by such Subcontractor under Section 2.05,
in each case as and when required to be delivered.
     Subsection 2.07 Indemnification; Remedies.
     The Company shall indemnify the Purchaser, each affiliate of the Purchaser,
and each of the following parties participating in a Securitization Transaction:
each Sponsor; each issuing entity; each Person (including, but not limited to,
any Master Servicer if applicable) responsible for the preparation, execution or
filing of any report required to be filed with the Commission with respect to
such Securitization Transaction, or for execution of a certification pursuant to
Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction; each broker dealer acting as underwriter, placement
agent or initial purchaser, each Person who controls any of such parties or the
Depositor (within the meaning of Section 15 of the Securities Act and Section 20
of the Exchange Act); and the respective present and former directors, officers,
employees, agents and affiliates of each of the foregoing and of the Depositor
(each, an “Indemnified Party”), and shall hold each of them harmless from and
against any

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claims, losses, damages, penalties, fines, forfeitures, legal fees and expenses
and related costs, judgments, and any other costs, fees and expenses that any of
them may sustain arising out of or based upon:
     (a) (A) any untrue statement of a material fact contained or alleged to be
contained in any information, report, certification, accountants’ letter or
other material provided in written or electronic format under this Article II by
or on behalf of the Company, or provided under this Article II by or on behalf
of any Subservicer, Subcontractor or Third-Party Originator (collectively, the
“Company Information”), or (B) the omission or alleged omission to state in the
Company Information a material fact required to be stated in the Company
Information or necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided, by
way of clarification, that clause (B) of this paragraph shall be construed
solely by reference to the Company Information and not to any other information
communicated in connection with a sale or purchase of securities, without regard
to whether the Company Information or any portion thereof is presented together
with or separately from such other information;
     (b) any breach by the Company of its obligations under this Article II,
including particularly any failure by the Company, any Subservicer, any
Subcontractor or any Third-Party Originator to deliver any information, report,
certification, accountants’ letter or other material when and as required under
this Article II, including any failure by the Company to identify pursuant to
Section 2.06(b) any Subcontractor “participating in the servicing function”
within the meaning of Item 1122 of Regulation AB;
     (c) any breach by the Company of a representation or warranty set forth in
Section 2.02(a) or in a writing furnished pursuant to Section 2.02(b) and made
as of a date prior to the closing date of the related Securitization
Transaction, to the extent that such breach is not cured by such closing date,
or any breach by the Company of a representation or warranty in a writing
furnished pursuant to Section 2.02(b) to the extent made as of a date subsequent
to such closing date, or
     (d) the negligence, bad faith or willful misconduct of the Company in
connection with its performance under this Article II.
     If the indemnification provided for herein is unavailable or insufficient
to hold harmless an Indemnified Party, then the Company agrees that it shall
contribute to the amount paid or payable by such Indemnified Party as a result
of any claims, losses, damages or liabilities incurred by such Indemnified Party
in such proportion as is appropriate to reflect the relative fault of such
Indemnified Party on the one hand and the Company on the other.
     In the case of any failure of performance described in clause (a)(ii) of
this Section, the Company shall promptly reimburse the Purchaser, any Depositor,
as applicable, and each Person responsible for the preparation, execution or
filing of any report required to be filed with the Commission with respect to
such Securitization Transaction, or for execution of a certification pursuant to
Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction, for all costs reasonably incurred by each such party
in order to obtain

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the information, report, certification, accountants’ letter or other material
not delivered as required by the Company, any Subservicer, any Subcontractor or
any Third-Party Originator.
     (e) This indemnification shall survive the termination of the Agreement or
the termination of any party to the Agreement.
     (i) Any failure by the Company, any Subservicer, any Subcontractor or any
Third-Party Originator to deliver any information, report, certification,
accountants’ letter or other material when and as required under this
Article II, or any breach by the Company of a representation or warranty set
forth in Section 2.02(a) or in a writing furnished pursuant to Section 2.02(b)
and made as of a date prior to the closing date of the related Securitization
Transaction, to the extent that such breach is not cured by such closing date,
or any breach by the Company of a representation or warranty in a writing
furnished pursuant to Section 2.02(b) to the extent made as of a date subsequent
to such closing date, shall, except as provided in clause (ii) of this
paragraph, immediately and automatically, without notice or grace period,
constitute an Event of Default with respect to the Company under the Agreement
and any applicable Reconstitution Agreement, and shall entitle the Purchaser or
Depositor, as applicable, in its sole discretion to terminate the rights and
obligations of the Company as servicer under the Agreement and/or any applicable
Reconstitution Agreement without payment (notwithstanding anything in the
Agreement or any applicable Reconstitution Agreement to the contrary) of any
compensation to the Company (and, if the Company is servicing any of the
Mortgage Loans in a Securitization Transaction, appoint a successor servicer
reasonably acceptable to any Master Servicer for such Securitization
Transaction); provided that to the extent that any provision of the Agreement
and/or any applicable Reconstitution Agreement expressly provides for the
survival of certain rights or obligations following termination of the Company
as servicer, such provision shall be given effect.
     (ii) Any failure by the Company, any Subservicer or any Subcontractor to
deliver any information, report, certification or accountants’ letter when and
as required under Section 2.04 or 2.05, including (except as provided below) any
failure by the Company to identify pursuant to Section 2.06(b) any Subcontractor
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, which continues unremedied for ten (10) calendar days after the
date on which such information, report, certification or accountants’ letter was
required to be delivered shall constitute an Event of Default with respect to
the Company under the Agreement and any applicable Reconstitution Agreement, and
shall entitle the Purchaser, any Master Servicer or any Depositor, as
applicable, in its sole discretion to terminate the rights and obligations of
the Company as servicer under the Agreement and/or any applicable Reconstitution
Agreement without payment (notwithstanding anything in this Agreement to the
contrary) of any compensation to the Company; provided that to the extent that
any provision of the Agreement and/or any applicable Reconstitution Agreement
expressly provides for the survival of certain rights or obligations following
termination of the Company as servicer, such provision shall be given effect.
     Neither the Purchaser nor any Depositor shall be entitled to terminate the
rights and obligations of the Company pursuant to this subparagraph (b)(ii) if a
failure of the Company to

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identify a Subcontractor “participating in the servicing function” within the
meaning of Items 1122 of Regulation AB was attributable solely to the role or
functions of such Subcontractor with respect to mortgage loans other than the
Mortgage Loans.
     (f) The Company shall promptly reimburse the Purchaser (or any designee of
the Purchaser), any Master Servicer and any Depositor, as applicable, for all
reasonable expenses incurred by the Purchaser (or such designee) or such
Depositor, as such are incurred, in connection with the termination of the
Company as servicer and the transfer of servicing of the Mortgage Loans to a
successor servicer. The provisions of this paragraph shall not limit whatever
rights the Purchaser or any Depositor may have under other provisions of the
Agreement and/or any applicable Reconstitution Agreement or otherwise, whether
in equity or at law, such as an action for damages, specific performance or
injunctive relief.
     Subsection 2.08 Third-party Beneficiary.
     For purposes of this Reg AB Addendum and any related provisions thereto,
each Master Servicer shall be considered a third-party beneficiary of the
Agreement, entitled to all the rights and benefits hereof as if it were a direct
party to the Agreement.

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EXHIBIT A
FORM OF ANNUAL CERTIFICATION

      Re:       The [    ] agreement dated as of [      ], 200[   ] (the
“Agreement”), among [IDENTIFY PARTIES]

I,                                         , the                               
           of Bank of America, National Association, certify to [the Purchaser],
[the Depositor], and the [Master Servicer] [Securities Administrator] [Trustee],
and their officers, with the knowledge and intent that they will rely upon this
certification, that:
     (1) I have reviewed the servicer compliance statement of the Company
provided in accordance with Item 1123 of Regulation AB (the “Compliance
Statement”), the report on assessment of the Company’s compliance with the
servicing criteria set forth in Item 1122(d) of Regulation AB and identified as
the responsibility of the Company on Exhibit B to the Regulation AB Compliance
Addendum to the Agreement (the “Servicing Criteria”), provided in accordance
with Rules 13a-18 and 15d-18 under Securities Exchange Act of 1934, as amended
(the “Exchange Act”) and Item 1122 of Regulation AB (the “Servicing
Assessment”), the registered public accounting firm’s attestation report
provided in accordance with Rules 13a-18 and 15d-18 under the Exchange Act and
Section 1122(b) of Regulation AB (the “Attestation Report”), and all servicing
reports, officer’s certificates and other information relating to the servicing
of the Mortgage Loans by the Company during 200[ ] that were delivered by the
Company to the [Depositor] [Master Servicer] [Securities Administrator]
[Trustee] pursuant to the Agreement (collectively, the “Company Servicing
Information”);
     (2) Based on my knowledge, the Company Servicing Information, taken as a
whole, does not contain any untrue statement of a material fact or omit to state
a material fact necessary to make the statements made, in the light of the
circumstances under which such statements were made, not misleading with respect
to the period of time covered by the Company Servicing Information;
     (3) Based on my knowledge, all of the Company Servicing Information
required to be provided by the Company under the Agreement has been provided to
the [Depositor] [Master Servicer] [Securities Administrator] [Trustee];
     (4) I am responsible for reviewing the activities performed by the Company
as servicer under the Agreement, and based on my knowledge and the compliance
review conducted in preparing the Compliance Statement and except as disclosed
in the Compliance Statement, the Servicing Assessment or the Attestation Report,
the Company has fulfilled its obligations under the Agreement in all material
respects; and
     (5) The Compliance Statement required to be delivered by the Company
pursuant to the Agreement, and the Servicing Assessment and Attestation Report
required to be provided by the Company and by any Subservicer or Subcontractor
pursuant to the Agreement, have been provided to the [Depositor] [Master
Servicer]. Any material instances of noncompliance described in such reports
have been disclosed to the [Depositor] [Master Servicer]. Any material instance
of noncompliance with the Servicing Criteria has been disclosed in such reports.

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  Date:        
 
     
 
   
 
           
 
  By:        
 
     
 
   
 
      Name:    
 
      Title:    

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EXHIBIT B
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by [the Company] [Name of
Subservicer] shall address, at a minimum, the criteria identified as below as
“Applicable Servicing Criteria”;

                  Applicable         Servicing Servicing Criteria   Criteria
Reference   Criteria    
 
       
 
  General Servicing Considerations    
1122(d)(1)(i)
  Policies and procedures are instituted to monitor any performance or other
triggers and events of default in accordance with the transaction agreements.  
x
 
       
1122(d)(1)(ii)
  If any material servicing activities are outsourced to third parties, policies
and procedures are instituted to monitor the third party’s performance and
compliance with such servicing activities.   x
 
       
1122(d)(1)(iii)
  Any requirements in the transaction agreements to maintain a back-up servicer
for the mortgage loans are maintained.    
 
       
1122(d)(1)(iv)
  A fidelity bond and errors and omissions policy is in effect on the party
participating in the servicing function throughout the reporting period in the
amount of coverage required by and otherwise in accordance with the terms of the
transaction agreements.   x
 
       
 
  Cash Collection and Administration    
 
       
1122(d)(2)(i)
  Payments on mortgage loans are deposited into the appropriate custodial bank
accounts and related bank clearing accounts no more than two business days
following receipt, or such other number of days specified in the transaction
agreements.   x
 
       
1122(d)(2)(ii)
  Disbursements made via wire transfer on behalf of an obligor or to an investor
are made only by authorized personnel.   x
 
       
1122(d)(2)(iii)
  Advances of funds or guarantees regarding collections, cash flows or
distributions, and any interest or other fees charged for such advances, are
made, reviewed and approved as specified in the transaction agreements.   x
 
       
1122(d)(2)(iv)
  The related accounts for the transaction, such as cash reserve accounts or
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth in the
transaction agreements.   x

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                  Applicable         Servicing Servicing Criteria   Criteria
Reference   Criteria    
 
       
1122(d)(2)(v)
  Each custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes of this
criterion, “federally insured depository institution” with respect to a foreign
financial institution means a foreign financial institution that meets the
requirements of Rule 13k-1(b)(1) of the Securities Exchange Act.   x
 
       
1122(d)(2)(vi)
  Unissued checks are safeguarded so as to prevent unauthorized access.    
 
       
1122(d)(2)(vii)
  Reconciliations are prepared on a monthly basis for all asset-backed
securities related bank accounts, including custodial accounts and related bank
clearing accounts. These reconciliations are (A) mathematically accurate;
(B) prepared within 30 calendar days after the bank statement cutoff date, or
such other number of days specified in the transaction agreements; (C) reviewed
and approved by someone other than the person who prepared the reconciliation;
and (D) contain explanations for reconciling items. These reconciling items are
resolved within 90 calendar days of their original identification, or such other
number of days specified in the transaction agreements.   x
 
       
 
  Investor Remittances and Reporting    
 
       
1122(d)(3)(i)
  Reports to investors, including those to be filed with the Commission, are
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A) are prepared in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with the terms
specified in the transaction agreements; (C) are filed with the Commission as
required by its rules and regulations; and (D) agree with investors’ or the
trustee’s records as to the total unpaid principal balance and number of
mortgage loans serviced by the Servicer.   x
 
       
1122(d)(3)(ii)
  Amounts due to investors are allocated and remitted in accordance with
timeframes, distribution priority and other terms set forth in the transaction
agreements.   x
 
       
1122(d)(3)(iii)
  Disbursements made to an investor are posted within two business days to the
Servicer’s investor records, or such other number of days specified in the
transaction agreements.   x
 
       
1122(d)(3)(iv)
  Amounts remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank statements.   x

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                  Applicable         Servicing Servicing Criteria   Criteria
Reference   Criteria    
 
       
 
  Pool Asset Administration    
 
       
1122(d)(4)(i)
  Collateral or security on mortgage loans is maintained as required by the
transaction agreements or related mortgage loan documents.   x
 
       
1122(d)(4)(ii)
  Mortgage loan and related documents are safeguarded as required by the
transaction agreements   x
 
       
1122(d)(4)(iii)
  Any additions, removals or substitutions to the asset pool are made, reviewed
and approved in accordance with any conditions or requirements in the
transaction agreements.   x
 
       
1122(d)(4)(iv)
  Payments on mortgage loans, including any payoffs, made in accordance with the
related mortgage loan documents are posted to the Servicer’s obligor records
maintained no more than two business days after receipt, or such other number of
days specified in the transaction agreements, and allocated to principal,
interest or other items (e.g., escrow) in accordance with the related mortgage
loan documents.   x
 
       
1122(d)(4)(v)
  The Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal balance.   x
 
       
1122(d)(4)(vi)
  Changes with respect to the terms or status of an obligor’s mortgage loans
(e.g., loan modifications or re-agings) are made, reviewed and approved by
authorized personnel in accordance with the transaction agreements and related
pool asset documents.   x
 
       
1122(d)(4)(vii)
  Loss mitigation or recovery actions (e.g., forbearance plans, modifications
and deeds in lieu of foreclosure, foreclosures and repossessions, as applicable)
are initiated, conducted and concluded in accordance with the timeframes or
other requirements established by the transaction agreements.   x
 
       
1122(d)(4)(viii)
  Records documenting collection efforts are maintained during the period a
mortgage loan is delinquent in accordance with the transaction agreements. Such
records are maintained on at least a monthly basis, or such other period
specified in the transaction agreements, and describe the entity’s activities in
monitoring delinquent mortgage loans including, for example, phone calls,
letters and payment rescheduling plans in cases where delinquency is deemed
temporary (e.g., illness or unemployment).   x

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                  Applicable         Servicing Servicing Criteria   Criteria
Reference   Criteria    
 
       
1122(d)(4)(ix)
  Adjustments to interest rates or rates of return for mortgage loans with
variable rates are computed based on the related mortgage loan documents.   x
 
       
1122(d)(4)(x)
  Regarding any funds held in trust for an obligor (such as escrow accounts):
(A) such funds are analyzed, in accordance with the obligor’s mortgage loan
documents, on at least an annual basis, or such other period specified in the
transaction agreements; (B) interest on such funds is paid, or credited, to
obligors in accordance with applicable mortgage loan documents and state laws;
and (C) such funds are returned to the obligor within 30 calendar days of full
repayment of the Mortgage Loans, or such other number of days specified in the
transaction agreements.   x
 
       
1122(d)(4)(xi)
  Payments made on behalf of an obligor (such as tax or insurance payments) are
made on or before the related penalty or expiration dates, as indicated on the
appropriate bills or notices for such payments, provided that such support has
been received by the servicer at least 30 calendar days prior to these dates, or
such other number of days specified in the transaction agreements.   x
 
       
1122(d)(4)(xii)
  Any late payment penalties in connection with any payment to be made on behalf
of an obligor are paid from the servicer’s funds and not charged to the obligor,
unless the late payment was due to the obligor’s error or omission.   x
 
       
1122(d)(4)(xiii)
  Disbursements made on behalf of an obligor are posted within two business days
to the obligor’s records maintained by the servicer, or such other number of
days specified in the transaction agreements.   x
 
       
1122(d)(4)(xiv)
  Delinquencies, charge-offs and uncollectible accounts are recognized and
recorded in accordance with the transaction agreements.   x
 
       
1122(d)(4)(xv)
  Any external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set forth in the
transaction agreements.    

I-21

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              [BANK OF AMERICA, NATIONAL
ASSOCIATION]
 
            [NAME OF SUBSERVICER]
 
       
 
  Date:    
 
       
 
       
 
  By:    
 
       
 
       
 
      Name:
 
       
 
      Title:

I-22

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BANK OF AMERICA—SEQUOIA TO TRUSTEE
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
For
Flow Mortgage Loan Sale and Servicing Agreement
     THIS ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT, dated as of
March 30, 2007 (the “Assignment”), is entered into among Sequoia Residential
Funding, Inc. (the “Assignor”), Bank of America, National Association, as the
servicer (the “Servicer”), and HSBC Bank USA, National Association (“HSBC Bank”)
as Trustee under a Pooling and Servicing Agreement dated as of March 1, 2007
(the “Pooling and Servicing Agreement”), among the Assignor, as Depositor, HSBC
Bank (in such Trustee capacity, the “Assignee”) and Wells Fargo Bank, N. A., as
Master Servicer and Securities Administrator.
RECITALS
          WHEREAS, RWT Holdings, Inc. (“RWT”) and the Servicer have entered into
a certain Flow Mortgage Loan Sale and Servicing Agreement, dated as of July 1,
2006 (the “Flow Sale and Servicing Agreement”), and the Servicer is currently
servicing certain mortgage loans (the “Mortgage Loans”) under the Flow Sale and
Servicing Agreement; and
     WHEREAS, RWT has previously sold, assigned and transferred all of its
right, title and interest in certain of the Mortgage Loans (the “Specified
Mortgage Loans”) which are listed on the mortgage loan schedule attached as
Exhibit I hereto (the “Specified Mortgage Loan Schedule”) and its rights under
the Flow Sale and Servicing Agreement with respect to the Specified Mortgage
Loans to Assignor; and
     WHEREAS, the Assignor has agreed to sell, assign and transfer to Assignee
all of its right, title and interest in the Specified Mortgage Loans and its
right under the Flow Sale and Servicing Agreement with respect to the Specified
Mortgage Loans; and
     WHEREAS, the parties hereto have agreed that the Specified Mortgage Loans
shall be subject to the terms of this Assignment.
     NOW, THEREFORE, in consideration of the mutual promises contained herein
and other good and valuable consideration (the receipt and sufficiency of which
are hereby acknowledged), the parties agree as follows:
     1. Assignment and Assumption.
          (a) Effective on and as of the date hereof, the Assignor hereby
pledges, assigns and transfers to the Assignee all of its right, title and
interest in the Specified Mortgage Loans and all of its rights (but none of the
Purchaser’s obligations) provided under the Flow Sale and Servicing Agreement to
the extent relating to the Specified Mortgage Loans, the Assignee hereby accepts
such assignment from the Assignor, and the Servicer hereby acknowledges such
assignment and assumption.

23

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          (b) Effective on and as of the date hereof, the Assignor represents
and warrants to the Assignee that the Assignor has not taken any action that
would serve to impair or encumber the Assignee’s interest in the Specified
Mortgage Loans since the date of the Assignor’s acquisition of the Specified
Mortgage Loans.
2. Recognition of the Assignee.
From and after the date hereof, subject to Section 3 below, the Servicer shall
recognize the Assignee as the holder of the rights and benefits of the Purchaser
with respect to the Specified Mortgage Loans and the Servicer will service the
Specified Mortgage Loans for the Assignee as if the Assignee and the Servicer
had entered into a separate servicing agreement for the servicing of the
Specified Mortgage Loans in the form of the Flow Sale and Servicing Agreement
(as amended hereby) with the Assignee as the Purchaser thereunder, the terms of
which Flow Sale and Servicing Agreement are incorporated herein by reference and
amended hereby. It is the intention of the parties hereto that this Assignment
will be a separate and distinct agreement, and the entire agreement, between the
parties hereto to the extent of the Specified Mortgage Loans and shall be
binding upon and for the benefit of the respective successors and assigns of the
parties hereto.
3. Assignor’s Continuing Rights and Responsibilities.
Notwithstanding Sections 1 and 2 above, the parties hereto agree that the
Assignor rather than the Assignee shall have the ongoing rights to take action
and the responsibilities of the Purchaser under the following sections of the
Flow Sale and Servicing Agreement:
Flow Sale and Servicing Agreement:

      Section   Matter
7.03, 1st, 2nd and 3rd ¶’s
  (a) Repurchase; Substitution.
 
   
11.01, 5th, 6th, 7th and 8th ¶’s
  (b) Servicer to Act as Servicer; Subservicing.
 
   
11.02
  (c) Liquidation of Mortgage Loans.
 
   
11.13(c)
  (d) Title, Management and Disposition of REO Property.
 
   
11.20
  (e) Servicer Shall Provide Access and Information as Reasonably Required.
 
   
12.01
  (f) Indemnification; Third-Party Claims.
 
   
12.04
  (g) Seller and Servicer Not to Resign.

24

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      Section   Matter
32
  (h) Cooperation of the Company with a Reconstitution; Regulation AB
Compliance.

     In addition, the Servicer agrees to furnish to the Assignor as well as the
Assignee and the Master Servicer copies of reports, notices, statements and
other communications required to be delivered by the Servicer pursuant to any of
the sections of the Flow Sale and Servicing Agreement referred to above and
under the following sections, at the times therein specified:
     Flow Sale and Servicing Agreement:

      Section    
 
   
11.09
  (a) Transfer of Accounts.
 
   
11.16
  (b) Statements to the Purchaser.
 
   
Subsection 2.04 of Addendum I
  (c) Servicer Compliance Statement.
 
   
Subsection 2.05 of Addendum I
  (d) Report on Assessment of Compliance and Attestation.

4. Amendment to the Flow Sale and Servicing Agreement.
The Flow Sale and Servicing Agreement are hereby amended as set forth in
Appendix A hereto with respect to the Specified Mortgage Loans.
5. Representations and Warranties.
(a) The Assignee represents and warrants that it is a sophisticated investor
able to evaluate the risks and merits of the transactions contemplated hereby,
and that it has not relied in connection therewith upon any statements or
representations of the Servicer or the Assignor other than those contained in
the Flow Sale and Servicing Agreement or this Assignment.
(b) Each of the parties hereto represents and warrants that it is duly and
legally authorized to enter into this Assignment.
(c) Each of the parties hereto represents and warrants that this Assignment has

25

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been duly authorized, executed and delivered by it and (assuming due
authorization, execution and delivery thereof by each of the other parties
hereto) constitutes its legal, valid and binding obligation, enforceable against
it in accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting the
enforcement of creditors’ rights generally and by general equitable principles
(regardless of whether such enforcement is considered in a proceeding in equity
or at law).

26

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6. Continuing Effect.
Except as contemplated hereby, the Flow Sale and Servicing Agreement shall
remain in full force and effect in accordance with their terms. This Assignment
constitutes a Reconstitution Agreement as contemplated in Section 32 of the Flow
Sale and Servicing Agreement and the Reconstitution Date shall be the date
hereof with respect to the Specified Mortgage Loans listed on Exhibit I on the
date hereof.
7. Governing Law.
This Assignment and the rights and obligations hereunder shall be governed by
and construed in accordance with the internal laws of the State of New York.
8. Notices.
Any notices or other communications permitted or required under the Flow Sale
and Servicing Agreement to be made to the Assignor and Assignee shall be made in
accordance with the terms of the Flow Sale and Servicing Agreement and shall be
sent to the Assignor and Assignee as follows:
Sequoia Residential Funding, Inc.
One Belvedere Place, Suite 330
Mill Valley, CA 94941
HSBC Bank USA, National Association
452 Fifth Avenue
New York, NY 10018
or to such other address as may hereafter be furnished by the Assignor or
Assignee to the other parties in accordance with the provisions of the Flow Sale
and Servicing Agreement.
9. Counterparts.
This Assignment may be executed in counterparts, each of which when so executed
shall be deemed to be an original and all of which when taken together shall
constitute one and the same instrument.
10. Definitions.
Any capitalized term used but not defined in this Assignment has the same
meaning as in the Flow Sale and Servicing Agreement.

27

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11. Master Servicer.
     The Servicer hereby acknowledges that the Assignee has appointed Wells
Fargo Bank, N. A. (the “Master Servicer”) to act as master servicer and
securities administrator under the Pooling and Servicing Agreement and hereby
agrees to treat all inquiries, instructions, authorizations and other
communications from the Master Servicer as if the same had been received from
the Assignee. The Master Servicer, acting on behalf of the Assignee, shall have
the rights of the Assignee as the Purchaser under the Flow Sale and Servicing
Agreement to enforce the obligations of the Servicer thereunder. Any notices or
other communications permitted or required under the Flow Sale and Servicing
Agreement to be made to the Assignee shall be made in accordance with the terms
of the Flow Sale and Servicing Agreement and shall be sent to the Master
Servicer at the following address:
Wells Fargo Bank, N. A.
P.O. Box 98
Columbia, Maryland 21046
(or, for overnight deliveries, 9062 Old Annapolis Road, Columbia, Maryland
21045)
Attention: Sequoia Mortgage Trust 2007-1
or to such other address as may hereafter be furnished by the Master Servicer to
Servicer. Any such notices or other communications permitted or required under
the Flow Sale and Servicing Agreement may be delivered in electronic format
unless manual signature is required in which case a hard copy of such report or
communication shall be required.
     The Servicer further acknowledges that the Assignor has engaged the Master
Servicer to provide certain default administration and that the Master Servicer,
acting as agent of the Assignor, may exercise any of the rights of the Purchaser
retained by the Assignor in Section 3 above.
     The Servicer shall make all distributions under the Flow Sale and Servicing
Agreement, as they relate to the Specified Mortgage Loans, to the Master
Servicer by wire transfer of immediately funds to:
Wells Fargo Bank, NA
San Francisco, CA
ABA# 121-000-248
Acct# 3970771416
Acct Name: SAS Clearing
FFC: 50996600

28

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12. Successors and Assigns.
     Upon a transfer of the Specified Mortgage Loans by the Assignee (other than
in respect of repurchases pursuant to Section 6.03 or Section 7.03 of the Flow
Sale and Servicing Agreement) to a buyer (“buyer”), such transfer shall
constitute a Reconstitution subject to the terms of Section 32 of the Flow Sale
and Servicing Agreement. Upon the closing of such transfer, the rights and
obligations of Purchaser retained by the Assignor pursuant to this Assignment
shall automatically terminate and the buyer shall be deemed to possess all of
the rights and obligations of Purchaser under the Flow Sale and Servicing
Agreement, provided, however, that the Assignor shall remain liable for any
obligations as Purchaser arising from or attributable to the period from the
date hereof to the closing date of such transfer.
[remainder of page intentionally left blank]

29

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     IN WITNESS WHEREOF, the parties hereto have executed this Assignment the
day and year first above written.

              ASSIGNOR:
 
            SEQUOIA RESIDENTIAL FUNDING, INC.
 
       
 
  By:    
 
       
 
  Name:    
 
       
 
  Title:    
 
       
 
            ASSIGNEE:
 
            HSBC BANK USA, NATIONAL ASSOCIATION
 
           
 
       
 
  By:    
 
       
 
  Name:    
 
       
 
  Title:    
 
       
 
            SERVICER:
 
            BANK OF AMERICA, NATIONAL ASSOCIATION
 
       
 
  By:    
 
       
 
  Name:    
 
       
 
  Title:    
 
       

30

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EXHIBIT I

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APPENDIX A
MODIFICATIONS TO THE FLOW SALE AND SERVICING AGREEMENT
     1. The definition of “Business Day” in Section 1 of the Agreement is hereby
deleted in its entirety and replaced with the following:
“Business Day: Any day other than (i) a Saturday or a Sunday, or (ii) a legal
holiday in the State of New York, or the State of California, or the State of
Maryland or the State of Minnesota, or (iii) a day on which banks in the State
of New York, or the State of California, or the State of Maryland or the State
of Minnesota are authorized or obligated by law or executive order to be
closed.”
     2. The definition of “Closing Date” is hereby revised to read as follows:
“Closing Date: March 30, 2007, except with respect to the first paragraph of
Section 2, Section 3, Section 4, Subsection 6.01, Subsection 6.03, Section 7.01
and the Term Sheet(s).”
     3. The definition of “Cut-off Date” is hereby revised to read as follows:
“Cut-off Date: March 1, 2007, except with respect to the first paragraph of
Section 2, Section 3, Section 4, Subsection 6.01, Subsection 6.03, Section 7.01
and the Term Sheet(s).”
     4. The definition of “First Remittance Date” is hereby revised to read as
follows:
“First Remittance Date: April 18, 2007.”
     5. Subsection 11.01 is revised to add the following sentence at then end of
the fifth paragraph:
     “Notwithstanding anything to the contrary in the this Agreement, the
Servicer shall not make or permit any modification, waiver or amendment of any
term of a Mortgage Loan that could cause any REMIC holding such Mortgage Loan to
fail to qualify as a REMIC or result in the imposition of any tax under
Section 860F(a) or 860G(d) of the Code on any REMIC holding such Mortgage Loan.”
     6. Subsection 11.04, first sentence of the first paragraph is revised to
read as follows:
     “The Servicer shall segregate and hold all funds collected and received
pursuant to each Mortgage Loan separate and apart from any of its own funds and
general assets and shall establish and maintain one or more Collection Accounts
(collectively, the “Collection Account”), titled “HSBC Bank USA, National
Association, in trust for the holders of Sequoia Mortgage Trust 2007-1 Mortgage
Pass-Through Certificates.”

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     7. Notwithstanding anything to the contrary in the Flow Sale and Servicing
Agreement, any Custodial Accounts established by the Servicer pursuant to
Subsection 11.04 of the Flow Sale and Servicing Agreement shall qualify as
Eligible Accounts as defined in the Pooling and Servicing Agreement.
     8. Subsection 11.13 is revised to add the following paragraphs at the end
of the section:
     “The REO Property must be sold within three years following the end of the
calendar year of the date of acquisition if a REMIC election has been made with
respect to the arrangement under which the Mortgage Loans and REO Property are
held, unless (i) the Purchaser shall have been supplied with an Opinion of
Counsel (at the Servicer’s expense) to the effect that the holding by the
related trust of such Mortgaged Property subsequent to such three-year period
(and specifying the period beyond such three-year period for which the Mortgaged
Property may be held) will not result in the imposition of taxes on “prohibited
transactions” of the related trust as defined in Section 860F of the Code, or
cause the related REMIC to fail to qualify as a REMIC, in which case the related
trust may continue to hold such Mortgaged Property (subject to any conditions
contained in such Opinion of Counsel), or (ii) the Purchaser (at the Servicer’s
expense) or the Servicer shall have applied for, prior to the expiration of such
three-year period, an extension of such three-year period in the manner
contemplated by Section 856(e)(3) of the Code, in which case the three-year
period shall be extended by the applicable period. If a period longer than three
years is permitted under the foregoing sentence and is necessary to sell any REO
Property, the Servicer shall report monthly to the Purchaser as to progress
being made in selling such REO Property.
     Notwithstanding any other provision of this Agreement, if a REMIC election
has been made, no Mortgaged Property held by a REMIC shall be rented (or allowed
to continue to be rented) or otherwise used for the production of income by or
on behalf of the related trust or sold in such a manner or pursuant to any terms
that would (i) cause such Mortgaged Property to fail to qualify at any time as
“foreclosure property” within a meaning of Section 860G(a)(8) of the Code,
(ii) subject to the related trust to the imposition of any federal or state
income taxes on “net income from foreclosure property” with respect to such
Mortgaged Property within the meaning of Section 860G(c) of the Code, or
(iii) cause the sale of such Mortgaged Property to result in the receipt by the
related trust or any income from non-permitted assets as described in
Section 860F(a) (2)(B) of the Code, unless the Servicer has agreed to indemnify
and hold harmless the related trust with respect to the imposition of any such
taxes.”
     9. Subsection 11.16, first sentence of the first paragraph is revised to
read as follows:
     “Not later than the tenth (10th) day of each month, the Servicer shall
forward to the Purchaser in an electronic format statements, in substantially
the same forms as, and providing the information described in, Exhibit 7 hereto;
or as otherwise mutually agreed to by Servicer and the Master Servicer”

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     10. The Flow Sale and Servicing Agreement is modified by adding a new
Subsection 11.24 which reads as follows:
     “Subsection 11.24 Compliance with REMIC Provisions.
     If a REMIC election has been made with respect to the arrangement under
which the Mortgage Loans and REO Property are held, the Servicer shall not take
any action, cause the REMIC to take any action or fail to take (or fail to cause
to be taken) any action that, under the REMIC Provisions, if taken or not taken,
as the case may be could (i) endanger the status of the REMIC as a REMIC or
(ii) result in the imposition of a tax upon the REMIC (including but not limited
to the tax on “prohibited transactions” as defined in Section 860F(a)(2) of the
Code and the tax on “contribution” to a REMIC set forth in Section 860G(d) of
the Code unless the Servicer has received an Opinion of Counsel (at the expense
of the party seeking to take such actions) to the effect that the contemplated
action will not endanger such REMIC status or result in the imposition of any
such tax.”

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EXHIBIT 7
FORM OF MONTHLY REPORTS

                  Standard File Layout - Master Servicing         Column Name  
Description   Decimal   Format Comment
SER_INVESTOR_NBR
  A value assigned by the Servicer to define a group of loans.           Text up
to 20 digits
 
               
LOAN_NBR
  A unique identifier assigned to each loan by the investor.           Text up
to 10 digits
 
               
SERVICER_LOAN_NBR
  A unique number assigned to a loan by the Servicer. This may be different than
the LOAN_NBR.           Text up to 10 digits
 
               
SCHED_PAY_AMT
  Scheduled monthly principal and scheduled interest payment that a borrower is
expected to pay, P&I constant.     2     No commas(,) or dollar signs ($)
 
               
NOTE_INT_RATE
  The loan interest rate as reported by the Servicer.     4     Max length of 6
 
               
NET_INT_RATE
  The loan gross interest rate less the service fee rate as reported by the
Servicer.     4     Max length of 6
 
               
SERV_FEE_RATE
  The servicer’s fee rate for a loan as reported by the Servicer.     4     Max
length of 6
 
               
SERV_FEE_AMT
  The servicer’s fee amount for a loan as reported by the Servicer.     2     No
commas(,) or dollar signs ($)
 
               
NEW_PAY_AMT
  The new loan payment amount as reported by the Servicer.     2     No
commas(,) or dollar signs ($)
 
               
NEW_LOAN_RATE
  The new loan rate as reported by the Servicer.     4     Max length of 6
 
               
ARM_INDEX_RATE
  The index the Servicer is using to calculate a forecasted rate.     4     Max
length of 6
 
               
ACTL_BEG_PRIN_BAL
  The borrower’s actual principal balance at the beginning of the processing
cycle.     2     No commas(,) or dollar signs ($)
 
               
ACTL_END_PRIN_BAL
  The borrower’s actual principal balance at the end of the processing cycle.  
  2     No commas(,) or dollar signs ($)
 
               
BORR_NEXT_PAY_DUE_DATE
  The date at the end of processing cycle that the borrower’s next payment is
due to the Servicer, as reported by Servicer.           MM/DD/YYYY
 
               
SERV_CURT_AMT_1
  The first curtailment amount to be applied.     2     No commas(,) or dollar
signs ($)

 

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                  Standard File Layout - Master Servicing         Column Name  
Description   Decimal   Format Comment
SERV_CURT_DATE_1
  The curtailment date associated with the first curtailment amount.          
MM/DD/YYYY
 
               
CURT_ADJ_AMT_1
  The curtailment interest on the first curtailment amount, if applicable.     2
    No commas(,) or dollar signs ($)
 
               
SERV_CURT_AMT_2
  The second curtailment amount to be applied.     2     No commas(,) or dollar
signs ($)
 
               
SERV_CURT_DATE_2
  The curtailment date associated with the second curtailment amount.          
MM/DD/YYYY
 
               
CURT_ADJ_AMT_2
  The curtailment interest on the second curtailment amount, if applicable.    
2     No commas(,) or dollar signs ($)
 
               
SERV_CURT_AMT_3
  The third curtailment amount to be applied.     2     No commas(,) or dollar
signs ($)
 
               
SERV_CURT_DATE_3
  The curtailment date associated with the third curtailment amount.          
MM/DD/YYYY
 
               
CURT_ADJ_AMT_3
  The curtailment interest on the third curtailment amount, if applicable.     2
    No commas(,) or dollar signs ($)
 
               
PIF_AMT
  The loan “paid in full” amount as reported by the Servicer.     2     No
commas(,) or dollar signs ($)
 
               
PIF_DATE
  The paid in full date as reported by the Servicer.           MM/DD/YYYY
 
               
ACTION_CODE
  The standard FNMA numeric code used to indicate the default/delinquent status
of a particular loan.           Action Code Key: 15=Bankruptcy,
30=Foreclosure, , 60=PIF,
63=Substitution,
65=Repurchase,70=REO
 
               
INT_ADJ_AMT
  The amount of the interest adjustment as reported by the Servicer.     2    
No commas(,) or dollar signs ($)
 
               
SOLDIER_SAILOR_ADJ_AMT
  The Soldier and Sailor Adjustment amount, if applicable.     2     No
commas(,) or dollar signs ($)
 
               
NON_ADV_LOAN_AMT
  The Non Recoverable Loan Amount, if applicable.     2     No commas(,) or
dollar signs ($)
 
               
LOAN_LOSS_AMT
  The amount the Servicer is passing as a loss, if applicable.     2     No
commas(,) or dollar signs ($)
 
               
SCHED_BEG_PRIN_BAL
  The scheduled outstanding principal amount due at the beginning of the cycle
date to be passed through to investors.     2     No commas(,) or dollar signs
($)
 
               
SCHED_END_PRIN_BAL
  The scheduled principal balance due to investors at the end of a processing
cycle.     2     No commas(,) or dollar signs ($)
 
               
SCHED_PRIN_AMT
  The scheduled principal amount as reported by the Servicer for the current
cycle — only applicable for Scheduled/Scheduled Loans.     2     No commas(,) or
dollar signs ($)

 

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                  Standard File Layout - Master Servicing         Column Name  
Description   Decimal   Format Comment
SCHED_NET_INT
  The scheduled gross interest amount less the service fee amount for the
current cycle as reported by the Servicer — only applicable for
Scheduled/Scheduled Loans.     2     No commas(,) or dollar signs ($)
 
               
ACTL_PRIN_AMT
  The actual principal amount collected by the Servicer for the current
reporting cycle — only applicable for Actual/Actual Loans.     2     No
commas(,) or dollar signs ($)
 
               
ACTL_NET_INT
  The actual gross interest amount less the service fee amount for the current
reporting cycle as reported by the Servicer — only applicable for Actual/Actual
Loans.     2     No commas(,) or dollar signs ($)
 
               
PREPAY_PENALTY_AMT
  The penalty amount received when a borrower prepays on his loan as reported by
the Servicer.     2     No commas(,) or dollar signs ($)
 
               
PREPAY_PENALTY_WAIVED
  The prepayment penalty amount for the loan waived by the servicer.     2    
No commas(,) or dollar signs ($)
 
               
MOD_DATE
  The Effective Payment Date of the Modification for the loan.          
MM/DD/YYYY
 
               
MOD_TYPE
  The Modification Type.           Varchar — value can be alpha or numeric
 
               
DELINQ_P&I_ADVANCE_AMT
  The current outstanding principal and interest advances made by Servicer.    
2     No commas(,) or dollar signs ($)
 
               
BREACH_FLAG
  Flag to indicate if the repurchase of a loan is due to a breach of
Representations and Warranties           Y=Breach
N=NO Breach
Let blank if N/A

 

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Exhibit 2: Monthly Summary Report by Single Investor
MONTHLY SUMMARY REPORT

             
For Month Ended: mm/dd/yyyy
  Servicer Name        
 
           
Prepared by:                                         
  Investor Nbr        
 
           

Section 1. Remittances and Ending Balances — Required Data

                                              Beginning   Ending   Total Monthly
  Total Ending Unpaid   Total Monthly Principal     Loan Count   Loan Count  
Remittance Amo   Principal Balance   Balance       0       0     $ 0.00     $
0.00     $ 0.00  

                  Principal Calculation             1.  
Monthly Principal Due
  +   $ 0.00      
 
          2.  
Current Curtailments
  +   $ 0.00      
 
          3.  
Liquidations
  +   $ 0.00      
 
          4.  
Other (attach explanation)
  +   $ 0.00      
 
          5.  
Principal Due
      $ 0.00      
 
          6.  
Interest (reported “gross”)
  +   $ 0.00      
 
          7.  
Interest Adjustments on Curtailments
  +   $ 0.00      
 
          8.  
Servicing Fees
  —   $ 0.00      
 
          9.  
Other Interest (attach explanation)
  +   $ 0.00      
 
          10.  
Interest Due (need to subtract ser fee)
      $ 0.00      
 
             
 
            Remittance Calculation             11.  
Total Principal and Interest Due (lines 5+10)
  +   $ 0.00      
 
          12.  
Reimbursement of Non-Recoverable Advances
  —   $ 0.00      
 
          13.  
Total Realized gains
  +   $ 0.00      
 
          14.  
Total Realized Losses
  —   $ 0.00      
 
          15.  
Total Prepayment Penalties
  +   $ 0.00      
 
          16.  
Total Non-Supported Compensating Interest
  —   $ 0.00      
 
          17.  
Other (attach explanation)
      $ 0.00      
 
          18.  
Net Funds Due on or before Remittance Date
  $   $ 0.00      
 
         

Section 2. Delinquency Report — Optional Data for Loan Accounting
Installments Delinquent

                                                                      Total No.
  Total No.                           In   Real Estate   Total Dollar     of  
of   30-   60-   90 or more   Foreclosure   Owned   Amount of     Loans  
Delinquencies   Days   Days   Days   (Optional)   (Optional)   Delinquencies    
  0       0       0       0       0       0       0     $ 0.00  

 

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Section 3. REG AB Summary Reporting — REPORT ALL APPLICABLE FIELDS

                  REG AB FIELDS   LOAN COUNT   BALANCE
PREPAYMENT PENALTY AMT
    0     $ 0.00  
PREPAYMENT PENALTY AMT WAIVED
    0     $ 0.00  
DELINQUENCY P&I AMOUNT
    0     $ 0.00  

 

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Standard File Layout — Delinquency Reporting

                                  Format Column/Header Name   Description  
Decimal   Comment
SERVICER_LOAN_NBR
  A unique number assigned to a loan by the Servicer. This may be different than
the LOAN_NBR            
 
               
LOAN_NBR
  A unique identifier assigned to each loan by the originator.            
 
               
CLIENT_NBR
  Servicer Client Number            
 
               
SERV_INVESTOR_NBR
  Contains a unique number as assigned by an external servicer to identify a
group of loans in their system.            
 
               
BORROWER_FIRST_NAME
  First Name of the Borrower.            
 
               
BORROWER_LAST_NAME
  Last name of the borrower.            
 
               
PROP_ADDRESS
  Street Name and Number of Property            
 
               
PROP_STATE
  The state where the property located.            
 
               
PROP_ZIP
  Zip code where the property is located.            
 
               
BORR_NEXT_PAY_DUE_DATE
  The date that the borrower’s next payment is due to the servicer at the end of
processing cycle, as reported by Servicer.           MM/DD/YYYY
 
               
LOAN_TYPE
  Loan Type (i.e. FHA, VA, Conv)            
 
               
BANKRUPTCY_FILED_DATE
  The date a particular bankruptcy claim was filed.           MM/DD/YYYY
 
               
BANKRUPTCY_CHAPTER_CODE
  The chapter under which the bankruptcy was filed.            
 
               
BANKRUPTCY_CASE_NBR
  The case number assigned by the court to the bankruptcy filing.            
 
               
POST_PETITION_DUE_DATE
  The payment due date once the bankruptcy has been approved by the courts      
    MM/DD/YYYY
 
               
BANKRUPTCY_DCHRG_DISM_DATE
  The Date The Loan Is Removed From Bankruptcy. Either by Dismissal, Discharged
and/or a Motion For Relief Was Granted.           MM/DD/YYYY
 
               
LOSS_MIT_APPR_DATE
  The Date The Loss Mitigation Was Approved By The Servicer           MM/DD/YYYY
 
               
LOSS_MIT_TYPE
  The Type Of Loss Mitigation Approved For A Loan Such As;            
 
               
LOSS_MIT_EST_COMP_DATE
  The Date The Loss Mitigation /Plan Is Scheduled To End/Close          
MM/DD/YYYY
 
               
LOSS_MIT_ACT_COMP_DATE
  The Date The Loss Mitigation Is Actually Completed           MM/DD/YYYY
 
               
FRCLSR_APPROVED_DATE
  The date DA Admin sends a letter to the servicer with instructions to begin
foreclosure proceedings.           MM/DD/YYYY
 
               
ATTORNEY_REFERRAL_DATE
  Date File Was Referred To Attorney to Pursue Foreclosure           MM/DD/YYYY
 
               
FIRST_LEGAL_DATE
  Notice of 1st legal filed by an Attorney in a Foreclosure Action          
MM/DD/YYYY
 
               
FRCLSR_SALE_EXPECTED_DATE
  The date by which a foreclosure sale is expected to occur.          
MM/DD/YYYY
 
               
FRCLSR_SALE_DATE
  The actual date of the foreclosure sale.           MM/DD/YYYY
 
               
FRCLSR_SALE_AMT
  The amount a property sold for at the foreclosure sale.     2     No commas(,)
or dollar signs ($)
 
               
EVICTION_START_DATE
  The date the servicer initiates eviction of the borrower.           MM/DD/YYYY
 
               
EVICTION_COMPLETED_DATE
  The date the court revokes legal possession of the property from the borrower.
          MM/DD/YYYY
 
               
LIST_PRICE
  The price at which an REO property is marketed.     2     No commas(,) or
dollar signs ($)
 
               
LIST_DATE
  The date an REO property is listed at a particular price.           MM/DD/YYYY
 
               
OFFER_AMT
  The dollar value of an offer for an REO property.     2     No commas(,) or
dollar signs ($)
 
               
OFFER_DATE_TIME
  The date an offer is received by DA Admin or by the Servicer.          
MM/DD/YYYY
 
               
REO_CLOSING_DATE
  The date the REO sale of the property is scheduled to close.          
MM/DD/YYYY
 
               
REO_ACTUAL_CLOSING_DATE
  Actual Date Of REO Sale           MM/DD/YYYY
 
               
OCCUPANT_CODE
  Classification of how the property is occupied.            
 
               
PROP_CONDITION_CODE
  A code that indicates the condition of the property.            
 
               
PROP_INSPECTION_DATE
  The date a property inspection is performed.           MM/DD/YYYY
 
               
APPRAISAL_DATE
  The date the appraisal was done.           MM/DD/YYYY

 

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

 

                                  Format Column/Header Name   Description  
Decimal   Comment
CURR_PROP_VAL
  The current “as is” value of the property based on brokers price opinion or
appraisal.     2      
 
               
REPAIRED_PROP_VAL
  The amount the property would be worth if repairs are completed pursuant to a
broker’s price opinion or appraisal.     2      
 
               
If applicable:
               
 
               
DELINQ_STATUS_CODE
  FNMA Code Describing Status of Loan            
 
               
DELINQ_REASON_CODE
  The circumstances which caused a borrower to stop paying on a loan. Code
indicates the reason why the loan is in default for this cycle.            
 
               
MI_CLAIM_FILED_DATE
  Date Mortgage Insurance Claim Was Filed With Mortgage Insurance Company.      
    MM/DD/YYYY
 
               
MI_CLAIM_AMT
  Amount of Mortgage Insurance Claim Filed           No commas(,) or dollar
signs ($)
 
               
MI_CLAIM_PAID_DATE
  Date Mortgage Insurance Company Disbursed Claim Payment           MM/DD/YYYY
 
               
MI_CLAIM_AMT_PAID
  Amount Mortgage Insurance Company Paid On Claim     2     No commas(,) or
dollar signs ($)
 
               
POOL_CLAIM_FILED_DATE
  Date Claim Was Filed With Pool Insurance Company           MM/DD/YYYY
 
               
POOL_CLAIM_AMT
  Amount of Claim Filed With Pool Insurance Company     2     No commas(,) or
dollar signs ($)
 
               
POOL_CLAIM_PAID_DATE
  Date Claim Was Settled and The Check Was Issued By The Pool Insurer          
MM/DD/YYYY
 
               
POOL_CLAIM_AMT_PAID
  Amount Paid On Claim By Pool Insurance Company     2     No commas(,) or
dollar signs ($)
 
               
FHA_PART_A_CLAIM_FILED_DATE
  Date FHA Part A Claim Was Filed With HUD           MM/DD/YYYY
 
               
FHA_PART_A_CLAIM_AMT
  Amount of FHA Part A Claim Filed     2     No commas(,) or dollar signs ($)
 
               
FHA_PART_A_CLAIM_PAID_DATE
  Date HUD Disbursed Part A Claim Payment           MM/DD/YYYY
 
               
FHA_PART_A_CLAIM_PAID_AMT
  Amount HUD Paid on Part A Claim     2     No commas(,) or dollar signs ($)
 
               
FHA_PART_B_CLAIM_FILED_DATE
  Date FHA Part B Claim Was Filed With HUD           MM/DD/YYYY
 
               
FHA_PART_B_CLAIM_AMT
  Amount of FHA Part B Claim Filed     2     No commas(,) or dollar signs ($)
 
               
FHA_PART_B_CLAIM_PAID_DATE
  Date HUD Disbursed Part B Claim Payment           MM/DD/YYYY
 
               
FHA_PART_B_CLAIM_PAID_AMT
  Amount HUD Paid on Part B Claim     2     No commas(,) or dollar signs ($)
 
               
VA_CLAIM_FILED_DATE
  Date VA Claim Was Filed With the Veterans Admin           MM/DD/YYYY
 
               
VA_CLAIM_PAID_DATE
  Date Veterans Admin. Disbursed VA Claim Payment           MM/DD/YYYY
 
               
VA_CLAIM_PAID_AMT
  Amount Veterans Admin. Paid on VA Claim     2     No commas(,) or dollar signs
($)
 
               
Current property value
  Currency            
 
               
Date of (Appraisal of BPO)
  Date/Time            
 
               
BK Discharge Dates
  Date/Time            
 
               
BK Dismissal Dates
  Date/Time            

Standard File Codes — Delinquency Reporting
The Loss Mit Type field should show the approved Loss Mitigation Code as
follows:

  •   ASUM-Approved Assumption     •   BAP- Borrower Assistance Program     •  
CO- Charge Off     •   DIL- Deed-in-Lieu     •   FFA- Formal Forbearance
Agreement     •   MOD- Loan Modification     •   PRE- Pre-Sale

 

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

 

  •   SS- Short Sale     •   MISC- Anything else approved by the PMI or Pool
Insurer

NOTE: Wells Fargo Bank will accept alternative Loss Mitigation Types to those
above, provided that they are consistent with industry standards. If Loss
Mitigation Types other than those above are used, the Servicer must supply Wells
Fargo Bank with a description of each of the Loss Mitigation Types prior to
sending the file.
The Occupant Code field should show the current status of the property code as
follows:

  •   Mortgagor     •   Tenant     •   Unknown     •   Vacant

The Property Condition field should show the last reported condition of the
property as follows:

  •   Damaged     •   Excellent     •   Fair     •   Gone     •   Good     •  
Poor     •   Special Hazard     •   Unknown

 

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

 

Standard File Codes — Delinquency Reporting, Continued
The FNMA Delinquent Reason Code field should show the Reason for Delinquency as
follows:

      Delinquency     Code   Delinquency Description
001
  FNMA-Death of principal mortgagor
 
   
002
  FNMA-Illness of principal mortgagor
 
   
003
  FNMA-Illness of mortgagor’s family member
 
   
004
  FNMA-Death of mortgagor’s family member
 
   
005
  FNMA-Marital difficulties
 
   
006
  FNMA-Curtailment of income
 
   
007
  FNMA-Excessive Obligation
 
   
008
  FNMA-Abandonment of property
 
   
009
  FNMA-Distant employee transfer
 
   
011
  FNMA-Property problem
 
   
012
  FNMA-Inability to sell property
 
   
013
  FNMA-Inability to rent property
 
   
014
  FNMA-Military Service
 
   
015
  FNMA-Other
 
   
016
  FNMA-Unemployment
 
   
017
  FNMA-Business failure
 
   
019
  FNMA-Casualty loss
 
   
022
  FNMA-Energy environment costs
 
   
023
  FNMA-Servicing problems
 
   
026
  FNMA-Payment adjustment
 
   
027
  FNMA-Payment dispute
 
   
029
  FNMA-Transfer of ownership pending
 
   
030
  FNMA-Fraud
 
   
031
  FNMA-Unable to contact borrower
 
   
INC
  FNMA-Incarceration

 

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Exhibit 2: Standard File Codes — Delinquency Reporting, Continued
The FNMA Delinquent Status Code field should show the Status of Default as
follows:

          Status Code   Status Description   09    
Forbearance
       
 
  17    
Pre-foreclosure Sale Closing Plan Accepted
       
 
  24    
Government Seizure
       
 
  26    
Refinance
       
 
  27    
Assumption
       
 
  28    
Modification
       
 
  29    
Charge-Off
       
 
  30    
Third Party Sale
       
 
  31    
Probate
       
 
  32    
Military Indulgence
       
 
  43    
Foreclosure Started
       
 
  44    
Deed-in-Lieu Started
       
 
  49    
Assignment Completed
       
 
  61    
Second Lien Considerations
       
 
  62    
Veteran’s Affairs-No Bid
       
 
  63    
Veteran’s Affairs-Refund
       
 
  64    
Veteran’s Affairs-Buydown
       
 
  65    
Chapter 7 Bankruptcy
       
 
  66    
Chapter 11 Bankruptcy
       
 
  67    
Chapter 13 Bankruptcy

 

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

 

Calculation of Realized Loss/Gain Form 332 — Instruction Sheet
NOTE: Do not net or combine items. Show all expenses individually and all
credits as separate line items. Claim packages are due on the remittance report
date. Late submissions may result in claims not being passed until the following
month. The Servicer is responsible to remit all funds pending loss approval and
/or resolution of any disputed items.

  (a)         (b)   The numbers on the 332 form correspond with the numbers
listed below.

Liquidation and Acquisition Expenses:

1.   The Actual Unpaid Principal Balance of the Mortgage Loan. For
documentation, an Amortization Schedule from date of default through liquidation
breaking out the net interest and servicing fees advanced is required.   2.  
The Total Interest Due less the aggregate amount of servicing fee that would
have been earned if all delinquent payments had been made as agreed. For
documentation, an Amortization Schedule from date of default through liquidation
breaking out the net interest and servicing fees advanced is required.   3.  
Accrued Servicing Fees based upon the Scheduled Principal Balance of the
Mortgage Loan as calculated on a monthly basis. For documentation, an
Amortization Schedule from date of default through liquidation breaking out the
net interest and servicing fees advanced is required.

4-12. Complete as applicable. Required documentation:

*   For taxes and insurance advances — see page 2 of 332 form — breakdown
required showing period of coverage, base tax, interest, penalty. Advances prior
to default require evidence of servicer efforts to recover advances.   *   For
escrow advances — complete payment history (to calculate advances from last
positive escrow balance forward)   *   Other expenses — copies of corporate
advance history showing all payments   *   REO repairs > $1500 require
explanation   *   REO repairs >$3000 require evidence of at least 2 bids.   *  
Short Sale or Charge Off require P&L supporting the decision and WFB’s approved
Officer Certificate   *   Unusual or extraordinary items may require further
documentation.

13. The total of lines 1 through 12.
(c) Credits:
14-21. Complete as applicable. Required documentation:

*   Copy of the HUD 1 from the REO sale. If a 3rd Party Sale, bid instructions
and Escrow Agent / Attorney       Letter of Proceeds Breakdown.   *   Copy of
EOB for any MI or gov’t guarantee   *   All other credits need to be clearly
defined on the 332 form

22. The total of lines 14 through 21.
Please Note: For HUD/VA loans, use line (18a) for Part A/Initial proceeds and
line (18b) for Part B/Supplemental proceeds.
Total Realized Loss (or Amount of Any Gain)

 

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

 

  23.   The total derived from subtracting line 22 from 13. If the amount
represents a realized gain, show the amount in parenthesis ( ).

 

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

 

Exhibit 3A: Calculation of Realized Loss/Gain Form 332

                 
Prepared by:
   
 
  Date:     
 
   
 
               
Phone:
   
 
  Email Address:     
 
   

         
Servicer Loan No.
  Servicer Name   Servicer Address
 
       
 
       

          WELLS FARGO BANK, N.A. Loan No.
                                                            
 
       
Borrower’s Name:
   
 
   
Property Address:
   
 
   

             
Liquidation Type: REO Sale
  3rd Party Sale   Short Sale   Charge Off

Was this loan granted a Bankruptcy deficiency or cramdown            Yes
           No
If “Yes”, provide deficiency or cramdown amount
                                                            

             
Liquidation and Acquisition Expenses:
           
(1) Actual Unpaid Principal Balance of Mortgage Loan
  $       (1)
 
           
(2) Interest accrued at Net Rate
          (2)
 
           
(3) Accrued Servicing Fees
          (3)
 
           
(4) Attorney’s Fees
          (4)
 
           
(5) Taxes (see page 2)
          (5)
 
           
(6) Property Maintenance
          (6)
 
           
(7) MI/Hazard Insurance Premiums (see page 2)
          (7)
 
           
(8) Utility Expenses
          (8)
 
           
(9) Appraisal/BPO
          (9)
 
           
(10) Property Inspections
          (10)
 
           
(11) FC Costs/Other Legal Expenses
          (11)
 
           
(12) Other (itemize)
          (12)
 
           
Cash for Keys                                                
          (12)
 
           
HOA/Condo Fees                                         
          (12)
 
           
                                                                         
          (12)
 
           
 
           
Total Expenses
  $       (13)
 
           
 
           
Credits:
           
(14) Escrow Balance
  $       (14)
 
           
(15) HIP Refund
          (15)
 
           
(16) Rental Receipts
          (16)
 
           
(17) Hazard Loss Proceeds
          (17)
 
           
(18) Primary Mortgage Insurance / Gov’t Insurance
          (18a) HUD Part A
 
           
 
          (18b) HUD Part B
 
           
(19)Pool Insurance Proceeds
          (19)
 
           
(20)Proceeds from Sale of Acquired Property
          (20)
 
           
(21)Other (itemize)
          (21)
 
           
                                                                         
          (21)
 
           
Total Credits
  $       (22)
 
           
Total Realized Loss (or Amount of Gain)
  $       (23)