Exhibit 10.11


 


Loan Purchase Agreement


 


This Agreement, dated as of 4/16, is made by and between Countrywide
Home Loans, Inc., a New York corporation (“Countrywide”), and Home Loan Center, a CA  corporation (“Seller”), for mutual considerations
set forth herein.


 


Countrywide agrees to purchase certain loans secured by real
property, together with the servicing thereof (the “Loans”), from Seller under
Countrywide’s mortgage loan programs, and Seller agrees to  sell to Countrywide certain
such Loans pursuant to the terms and conditions set forth herein and in
Countrywide’s Correspondent Lending Division Loan Purchase Program Seller’s
Manual, as amended from time to time (the “Manual”). In connection therewith,
the parties agree as follows:


 


1. ELIGIBLE LOANS


 


A.  Only those Loans fully complying with the standards
for Conforming
Conventional, Jumbo Conventional,
Government and Second Mortgage Loan Programs set forth in the Mortgage Programs
section of the Manual are eligible for  purchase under this Agreement.
Seller must be approved, qualified and/or licensed to originate such Loans.


 


B.   Seller shall
fully underwrite each Loan prior to submission to Countrywide in accordance
with Underwriting Guidelines and Lending Requirements sections of the Manual,
or, if available, use a Countrywide-approved automated underwriting system for
underwriting the Loan.


 


C.   Seller shall
be responsible for assuring that Loans submitted to Countrywide comply with all
terms and conditions of this Agreement and the Manual.


 


2. COMMITMENT TO PURCHASE LOANS


 


The procedure pursuant to
which Seller may commit to sell a Loan to Countrywide is detailed in the Loan
Registration section of the Manual. For purposes of this Agreement, Countrywide
and Seller define a best effort commitment to be a mandatory commitment if the Loan closes. Countrywide will confirm the conditions of the sale of the Loan
to Countrywide by delivering a confirmation (“Commitment”) to Seller which sets forth the terms of the
transaction, including the price Countrywide will pay for each Loan, as
determined pursuant to the Pricing standards set
forth in the Manual (the “Purchase Price”). The terms of the Commitment,
including the Purchase Price, shall be in effect for the period of time
requested by Seller and approved by Countrywide (the “Commitment Period”). If
Seller is
approved by Countrywide to sell
Loans to Countrywide on a bulk sale basis, Countrywide and Seller shall execute
the  Addendum to Loan Purchase Agreement (Bulk
Sales) which shall be attached to and incorporated into this Agreement by
reference.


 


3. UNDERWRITING AND PROPERTY APPRAISAL


 


A. Countrywide
shall have the right, but not the obligation, to underwrite any Loan submitted
for purchase pursuant to this Agreement, or otherwise insure that any Loan
submitted for  purchase complies with all terms and
conditions of this Agreement and the Manual; provided that neither the
existence nor the exercise of this right shall affect in any way Seller’s
obligations hereunder, including without limitation, Seller’s repurchase
obligations under Section 7 hereof and Seller’s hold harmless obligations
under Section 9 hereof. The applicable procedures are set forth in the Prior
Approval section of the Manual.


 


B.  Seller shall
deliver to Countrywide an appraisal of the real estate security for each
such Loan, signed by a qualified appraiser, as defined in the Manual, prior to
Countrywide’s approval to purchase such  Loan.


 


4.
DELIVERY OF LOAN DOCUMENTATION


 


A
Loan shall be deemed delivered to Countrywide if: (A) it is received by Countrywide
within the Commitment Period; (B) it is in compliance with the
requirements set forth in the Delivery of Closed Loans and Funding
Documentation sections of the Manual; and (C) there are no outstanding
conditions which would prevent Countrywide from funding the purchase of the
Loan. Failure by Seller to deliver to Countrywide within 120 days from the date
a Loan was purchased one or more of the original documents specified in the
Delivery of Closed Loans section of the Manual shall result in assessment by
Countrywide of a fee of $50 per month for each month, after the initial 120 day
period, during which one or more of such documents is outstanding, i.e., has
not been delivered to Countrywide for any period of time during the month. Such
fee shall
be $50 regardless of the number of such documents. Failure by
Seller to deliver to Countrywide one or more of the original documents
specified in the Delivery of Closed Loans section of the Manual within 270 days
from the date the Loan was purchased by Countrywide shall obligate Seller to repurchase the Loan pursuant to the provisions
of Section 7 of this
Agreement.


 


5. PAYMENT OF PURCHASE PRICE AND SELLER’S WIRE INSTRUCTIONS


 


Countrywide
shall, after receipt of a Loan documentation package which fully complies with
the requirements of the Manual, deliver the Purchase Price (less any fees or discounts due to Countrywide) set
forth in the applicable Commitment to Seller in accordance with Seller’s wire
instructions or in accordance with any ballee letter or trust receipt submitted with the Loan, as determined
in the sole and absolute
discretion of Countrywide.


 


	
  

  	
  [ILLEGIBLE]

  	
   

  



 


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6. SELLER’S OBLIGATIONS, REPRESENTATIONS AND WARRANTIES


 


A.  Seller represents and warrants to Countrywide
as to each Loan offered for sale under this Agreement that as  of the date  of
Countrywide’s purchase of such Loan:


 


(1)   The Loan documents have been duly executed by the trustor/mortgagor,
acknowledged and recorded; each Loan is valid and complies with all criteria
contained in
the Manual; the note and deed of trust/mortgage constitute the entire
Agreement between the trustor/mortgagor and the beneficiary/mortgagee, and there is no
verbal understanding or written modification
which would affect the terms of the note or the deed of trust/mortgage except
by written instrument delivered and expressly made known to the
beneficiary/mortgagee and recorded if recording is necessary to protect the
interests of the beneficiary/mortgagee.


 


(2)   Seller is the sole owner of the Loan and has authority to sell, transfer and assign the same on the terms set forth herein and in the
Manual. There has been no assignment, sale or hypothecation thereof by Seller,
except the usual hypothecation of the documents in connection with Seller’s
normal banking transactions in the conduct of its business.


 


(3)   The full principal amount of the Loan has been advanced to the
trustor/mortgagor, either by payment directly to such  person or by payment made on such
person’s request or  approval.
The unpaid principal balance of the Loan is as represented by Seller. All
costs, fees and expenses incurred in making, closing and recording the Loan
have been paid. No part of the mortgaged property has been released from the lien of the
Loan, the terms of the Loan have in no way been changed or modified, and the
Loan is current and not in default.


 


(4)   Each Loan is a valid first lien or, if specifically approved by
Countrywide, a valid second lien on the mortgaged property, and the mortgaged property is free and clear of all
encumbrances and liens having priority over the lien of such Loan, except
for the first
lien, if applicable, and liens for real estate taxes and special
assessments not yet due and payable and those exceptions allowed in connection
with Government Loans and other exceptions set forth in the Manual.


 


(5)   The mortgaged property is free and clear of all mechanics’ and materialmen’s
liens or liens in the nature thereof, and no rights are outstanding that under
law could give rise to any such lien, nor is Seller aware of any facts which could give rise to any such lien.


 


(6)   Each Loan which Seller represents to be insured or guaranteed is, or
will within 120 days from the date of delivery of such Loan to Countrywide be,
so insured or guaranteed. No action
has been taken or failed to have been taken which has resulted or will result
in an exclusion from, denial of, or defense to, coverage under such insurance
or guarantee; and all conditions within  the control of Seller as to the validity of
the insurance or guaranty as required by the National Housing Act of 1934 and
the rules and regulations thereunder, or as required by the Servicemen’s
Readjustment Act of 1944 and the rules and
regulations thereunder, or imposed by the mortgage insurance companies or other
insurers have been properly satisfied, and said insurance or guaranty is valid
and enforceable.


 


(7)   All federal and state laws, rules and regulations applicable to
the mortgage Loans have been complied with, including but not limited to: the
Real Estate Settlement
Procedures Act, the Flood Disaster Protection Act, the Federal Consumer
Credit Protection Act including the Truth-in-Lending and Equal Credit
Opportunity Acts, and all applicable statutes or regulations governing fraud, lack of consideration,
unconscionability, consumer credit transactions or interest charges.


 


(8)   No Loan is the subject of, and Seller is not aware of any facts which
could give rise to, litigation which could affect Countrywide’s ability to enforce
the terms of the obligation or its rights under the mortgage documents.


 


(9)   There is in force for each Loan either
(a) a paid-up title insurance policy on the Loan issued by a Countrywide
approved title company in an amount at least equal to the outstanding principal
balance of the Loan or (b) an attorney’s mortgage lien opinion. (Negatively amortizing loans require
additional coverage.)


 


(10) There is in force for each Loan valid hazard insurance policy coverage
and, where applicable, valid flood insurance policy coverage, and such coverages
meet the requirements of Countrywide specified in the Manual.


 


(11) Seller will record the corporate assignment in the name of  Countrywide Home Loans, Inc. at the time the deed of trust/mortgage
is recorded, and the assignment of the Loan from Seller to Countrywide shall be
valid and enforceable.


 


(12) The borrower has no rights of rescission, set-offs, counter-claims or
defenses to the note or deed of trust/mortgage securing the note arising from
the acts and/or omissions of Seller.


 


(13) Seller has no knowledge that any improvement located on or being part
of the mortgaged property is in violation of any
applicable zoning law or regulation.


 


(14) All improvements included for the purpose of determining the appraised
value of the mortgaged property lie wholly within the boundaries and building
restriction lines of such property, and no improvements on adjoining properties
encroach upon the mortgaged property.


 


(15) There is no proceeding pending for total or partial condemnation of any
mortgaged property and said property is free of substantial damage (including,
but not
limited to, any damage by fire, earthquake, windstorm,
vandalism or other casualty) and in good repair.


 


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(16) Seller has no
knowledge of any circumstances or conditions with respect to any Loan,
mortgaged property, trustor/mortgagor or trustor’s/mortgagor’s credit standing
that reasonably could be expected to cause private institutional investors to
regard any Loan as an unacceptable investment, cause any Loan to become
delinquent or adversely affect the value or marketability of the Loan.


 


(17) All documents submitted are genuine. All other representations as to each such Loan are true
and correct and meet the requirements and specifications of all parts of this Agreement and
the Manual.


 


B. Seller represents and
warrants to Countrywide that as of the date first set forth above and as of the
date of Countrywide’s purchase of each Loan hereunder:


 


(1)   Seller is duly organized, validly existing and in good standing under the laws of its state of
incorporation and is qualified and/or licensed as necessary to transact business, including the originating and
selling of mortgage loans, and is in good standing in each state where the property
securing a Loan is located.


 


(2)   Seller has the full power and authority to hold and sell each Loan; and
neither the execution and delivery of this Agreement, nor the acquisition or
origination of the Loans, nor the sale of the Loans, nor the consummation of the
transactions contemplated herein, nor the fulfillment of or compliance with the
terms and conditions of this Agreement will conflict with, or result in a
breach of any term, condition or provision of, Seller’s certificate of
incorporation or by-laws, any license held by Seller or governing Seller’s
activities or any agreement to which Seller is a party or by which Seller is
bound, or constitute a material default or result in an acceleration under any
of the foregoing.


 


(3)   No consent, approval, authorization or order of any court, governmental
body or any other person or entity is required for the execution, delivery and
performance by Seller of this Agreement, including but not limited to, the sale
of the Loans to Countrywide.


 


(4)   Neither Seller nor its agents know of any suit, action, arbitration or
legal or administrative or other proceeding pending or threatened against
Seller which would affect its ability to perform its obligations under this
Agreement.


 


(5)   Seller is not a party to, bound by or in breach or violation of any
agreement or instrument, or subject to or in violation of any statute, order or
regulation of any court, regulatory body, administrative agency or governmental
body having jurisdiction over it, which materially and adversely affects, or
may in the future materially and adversely affect, the ability of Seller to perform its obligations under this Agreement or the Manual, including,
without limitation, Seller’s repurchase and indemnification obligations
pursuant to Sections 7, 8 and 9 of this Agreement.


 


7. SELLER’S REPURCHASE OBLIGATIONS


 


A.  Seller
shall repurchase any Loan sold to Countrywide pursuant to this Agreement within
twenty business days of receipt of written notice from Countrywide of any of
the following circumstances (the “Repurchase Obligation”):


 


(1)   Seller fails to deliver to Countrywide within 270 days from the date
each Loan was purchased the original documents specified in the Delivery of
Closed Loans section of the Manual.


 


(2)   Countrywide determines that there is any evidence of fraud in the
origination of the Loan or in the sale of the Loan to Countrywide or that any matter in the mortgage loan file is not true
and correct.


 


(3)   If Countrywide determines the Loan is not eligible for GNMA, FNMA or FHLMC
pool participation or whole loan purchase or purchase by a private investor,
or, if Countrywide has sold such Loan in whole or in part to  GNMA, FNMA, FHLMC or a  private  investor, and GNMA, FNMA, FHLMC or the private investor  requires Countrywide to repurchase said interest or reimburse it for
losses, or the mortgage insurer denies coverage on the Loan; provided the
reason for such ineligibility; repurchase, reimbursement or denial shall be due
to a failure of the Loan to meet requirements specified in the Manual at the time of Countrywide’s purchase of  the Loan from Seller.


 


(4)   If the first payment due Countrywide is not received by Countrywide,
whether from the borrower directly or forwarded by Seller if the Borrower has
submitted the  payment to Seller, by the last day of the
month in which it is due, and, in addition, at any time within the first twelve
months after the Loan has been purchased by Countrywide, the Borrower is 90
days delinquent with respect to a monthly payment. For this purpose a Borrower shall be considered to be 90 days delinquent on a monthly
payment if it is not received by Countrywide by the last day of the third
month, regardless of the number of days in the month. For example, if the
Borrower has not made his/her January payment by the last day of March,
the Borrower shall be considered 90 days delinquent with respect
to the January payment. Seller shall not have the right to advance funds
for or on behalf of a Borrower for any delinquent payment or to  otherwise
make funds available to any Borrower to avoid or cure a default by the
Borrower. A payment for which Countrywide deducted funds at the time it purchased the Loan from Seller shall not be considered the first
payment due Countrywide.


 


(5)   Seller falls to observe or perform or breaches in any material respect
any of the representations, warranties or agreements contained in this
Agreement or the Manual with respect to a particular Loan.


 


(6)   With respect solely to VA Loans purchased by Countrywide pursuant to an
Assignment of Trade Addendum to this Agreement or on a Direct Trade basis
pursuant to a Direct Trade Addendum to this Agreement, if the Loan  goes into foreclosure within 24 months from the date  of sale of the Loan to Countrywide as to
those Loans with full  guarantees from the VA and 48 months from the date of sale of the Loan to
Countrywide as to those Loans with partial guarantees from the VA and as to which the VA gives Countrywide a  no-bid instruction in
conjunction with the foreclosure
sale on such Loan.


 


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B.   The option to request or accept repurchase of any Loan is at the sole
discretion of Countrywide. Notwithstanding that a Seller may be obligated pursuant to the terms of this Section 7
to repurchase a Loan, if such Loan is in compliance with all requirements of
this Agreement and the Manual at the time of its purchase by Countrywide and if
there is no evidence of fraud or misrepresentation in connection with the Loan,
Countrywide, in its sole discretion and on terms determined solely by Countrywide,
may consider
permitting Seller to indemnify Countrywide against all suits, costs, damages,
losses, fees or claims, including without limitation reasonable attorneys’
fees, which may be incurred by Countrywide in connection with such Loan. Such
indemnification shall be substantially in the form of the applicable
Indemnification Agreement, the provisions of which shall include, without
limitation, the requirement that the
Seller shall pay to Countrywide, at the time that the indemnification Agreement
is executed, the amount specified by Countrywide as the amount necessary to
cover its projected and potential costs and losses, and including the service
release premium paid by Countrywide to the Seller with respect to the Loan.


 


C.   It is agreed by the parties that Seller’s Repurchase Obligation with respect to
a Loan shall not be obviated by the fact that the property securing the Loan has been foreclosed upon and said property has been acquired by Countrywide or
a third party, it being understood that the term Repurchase Obligation
encompasses within its meaning the repurchase of the property from Countrywide
if Countrywide has acquired the property, or, if a third party has acquired the
property, reimbursing Countrywide in the amount specified in Section 8.C.
of this Agreement.


 


D.  It is further agreed by the parties that if Countrywide has made demand
on Seller to repurchase a Loan pursuant to Section 7 of this Agreement,
Countrywide shall have the right to withhold any monies due Seller in
connection with the Loan(s) subject to the Repurchase Obligation or any
other Loans until the parties have agreed that the Repurchase Obligation is
satisfied.


 


8. REPURCHASE PRICE


 


A. The repurchase price for Loans subject to a
Repurchase Obligation pursuant to Section 7 hereof shall be as follows:


 


(1)   The current unpaid principal balance of such Loan if it has been pooled
or resold. If such loan has not been pooled or resold by Countrywide, the
repurchase price shall be at the original price, less principal reduction since
the original purchase of the Loan by Countrywide; plus


 


(2)   All interest accrued but unpaid on the principal balance of the Loan
from the paid-to-date of the loan through and including the last day of the
month in which the repurchase is made; plus


 


(3)   All expenses, including but not limited to reasonable fees and expenses of
counsel, incurred by Countrywide in enforcing Seller’s obligation to repurchase
such Loan; plus


 


(4)   The original servicing release premium paid by Countrywide with respect
to such Loan; plus


 


(5)   Any unreimbursed advances of taxes or insurance made by Countrywide
with regard to such Loan as of the date of repurchase; less


 


(6)   Any proceeds of mortgage insurance with respect to the Loan collected
by Countrywide.


 


Upon
any such repurchase of Loans by Seller, Countrywide shall endorse the
promissory note (without recourse) and shall assign any security interest
(without recourse and in recordable form) to Seller.


 


B.   If the
real property security for the Loan has been foreclosed upon and purchased by
Countrywide at the foreclosure sale, then the repurchase price pursuant to Section 7
hereof, notwithstanding the amount of Countrywide’s credit bid, shall be:


 


(1)  The current unpaid principal balance of such Loan if it has been pooled
or resold. If such loan has nor been pooled or resold by Countrywide, the
repurchase price shall be at the original price, less principal reduction since the
original purchase of the Loan by Countrywide; plus


 


(2)  All interest accrued but unpaid on the principal balance of the Loan from
the paid-to-date of the loan through and including the last day of the Month in which
the foreclosure sale occurs; plus


 


(3)  All costs and expenses,
including but not limited to
reasonable fees and expenses of counsel, incurred by Countrywide in connection with the foreclosure
and in enforcing Seller’s
Repurchase Obligations hereunder; plus


 


(4)  The original servicing release premium paid by Countrywide with regard
to such Loan; plus


 


(5)  Any unreimbursed advances of taxes or insurance made by Countrywide
with regard to such Loan as of
the date of repurchase; plus


 


(6)  Interest on the amounts set forth in paragraphs (l) through (5) above
at the Loan rate from the end of the month in which the foreclosure sale
occurred until and including the date of repurchase by Seller; less


 


(7)  Any proceeds of mortgage insurance collected by Countrywide with
respect to the Loan.


 


Upon payment of the
repurchase price, Countrywide shall transfer title to the property securing such
Loan to Seller.


 


C. If the real
property security for the Loan has been sold at foreclosure and purchased by a
third party, the amount Seller shall pay Countrywide to fulfill its Repurchase
Obligation pursuant to Section 7 of this Agreement shall be as follows:


 


(1)  The current unpaid principal balance of such Loan if it has been pooled or resold. If such loan
has not been pooled or resold by Countrywide, the repurchase price shall be at
the original price, less principal reduction since the original purchase of the
Loan by Countrywide; plus


 


4

















 


(2)  All interest accrued but unpaid on the principal balance of the Loan
from the paid-to-date of the loan through and including the last day of the
month in which the foreclosure sale occurs; plus


 


(3)  All costs and expenses, including but not limited to reasonable fees
and expenses of counsel, incurred by Countrywide in enforcing Seller’s
Repurchase Obligations hereunder; plus


 


(4)  The original servicing release premium paid by Countrywide with regard
to such Loan; plus


 


(5)  Any unreimbursed advances of taxes or insurance made by Countrywide
with regard to such Loan as of the date of repurchase; plus


 


(6)  Interest on the amounts set forth in paragraphs (1) through
(5) above at the Loan rate from the end of the month in which the
foreclosure sale occurred until and including the date of repurchase by Seller;
less


 


(7)  The net proceeds of the foreclosure sale (sale price minus costs and
expenses, including but not limited to reasonable fees and expenses of counsel, incurred by Countrywide in
connection with the foreclosure sale); less


 


(8)  Any proceeds of mortgage insurance collected by Countrywide in
connection with the Loan.


 


9. HOLD HARMLESS


 


A. Seller shall hold Countrywide harmless and shall indemnify Countrywide
from and against any and all suits, costs, damages, losses, fees or claims,
including without limitation reasonable attorney’s fees (“Loss”), arising out of or in connection with any negligence,
fraud or a material omission on the part of Seller in receiving, processing or
funding any Loan committed to Countrywide for sale under Section 2 above,
during the origination period and Commitment Period up to and including the date
the Loan is purchased by Countrywide. Seller’s obligation to Countrywide in
this regard shall remain effective after Countrywide’s purchase of the Loan if
the Loss arose prior to purchase but was
undetected at time of purchase. This paragraph shall not modify Seller’s obligations
contained elsewhere in this Agreement.


 


B. Seller shall also hold Countrywide harmless and shall indemnify
Countrywide from and against any and all suits, costs, damages, fees or claims, including without
limitation reasonable attorneys’ fees, arising out of or in connection with any
one or more of the items set forth in paragraphs (1) through (6) of Section 7A.
of this Agreement.


 


10. NO SOLICITATION


 


Loans
sold to Countrywide cannot be solicited by Seller for refinance for a period of
12 months from the date the Loan is purchased by Countrywide. Borrowers
requesting a refinance from Seller within the 12 month period must be referred
to Countrywide or, provided the refinanced loan meets all Countrywide
requirements as specified in the Manual, may be processed by the Seller and
sold to Countrywide for a service release premium, if any, to be
negotiated by the parties.


 


11. PROHIBITION AGAINST USE OF NAME OR AFFILIATION


 


Seller
shall not hold itself out as a joint venturer, partner, representative,
employee or agent of Countrywide. Nor shall it use Countrywide’s name in any
advertising or written or broadcast material without Countrywide’s express
prior written consent. This prohibition shall not prevent Seller from using any
advertising media provided to it by Countrywide for use by Seller and
containing any copyrighted Countrywide name or logo. Such copyrighted name or
logo shall remain in place.


 


12. TERMINATION –  SUSPENSION


 


A. This Agreement may be terminated as to future commitments for sale of
Loans by either party at any time, but such termination shall not in any
respect change or modify the obligation of Seller with respect to Loans already
subject to a Commitment. The effective time of termination shall be the earlier
of the time written notice is actually received by the other party or five days
after written notice is posted in the United States Postal Service by the
canceling party. Termination of this Agreement shall not in any way affect
either Seller’s or Countrywide’s
obligations, representations, warranties or indemnifications with respect to
Loans already purchased by Countrywide; provided, however, that Countrywide may
immediately terminate its obligations hereunder without notice and immediately
return to Seller any Loans subject to a Commitment, and Seller shall accept
such loans if Coutrywide reasonably determines that there has been any
deception, fraud, concealment or material misrepresentation by Seller in
performing any of its duties, obligations, responsibilities or actions
undertaken in connection with this Agreement or in connection with any Loan sold to Countrywide pursuant to this
Agreement.


 


B. In addition to the termination rights set
forth in Paragraph A. above, in the event that Countrywide believes in good faith that Seller has breached an obligation (including
a Repurchase Obligation under Section 7), representation, warranty or
covenant under the Agreement, or will be unable to fulfill any of its
obligations under the Agreement or the Manual (including a Repurchase
Obligation under Section 7), Countrywide may, in its sole and absolute
discretion, suspend this Agreement as to future Commitments for the sale of
Loans by Seller.
Such suspension shall be
effective immediately upon Seller’s receiving written notice of same from
Countrywide and shall last until Countrywide, in its sole discretion,
determines to reactivate or terminate this Agreement.


 


13. EXHIBITS


 


All
exhibits attached hereto or
material referred to in this Agreement, including the Manual, are incorporated
by reference into this Agreement. To the extent there are differences between
requirements as stated in the Manual and as stated in this Agreement, the
provisions of this Agreement shall govern.


 


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14. ENTIRE AGREEMENT


 


The
entire agreement between the parties is contained in this Agreement and in the Manual and cannot be modified in any respect except by an amendment
in writing signed by both parties. The invalidity of any portion of this Agreement
shall in no way affect the balance thereof.


 


15. ASSIGNMENT


 


Seller
may not assign its rights or delegate its
duties or obligations under this Agreement without the prior written
consent of Countrywide. This Agreement shall be binding on and inure to the
benefit of the permitted successors and assigns of the parties hereto.


 


16. ATTORNEYS’ FEES AND EXPENSES-CHOICE OF LAW AND FORUM


 


If
any party hereto shall bring suit or other
proceeding against the other as a
result of any alleged breach or failure by the other party to fulfill or
perform any covenants or obligations under this Agreement, then the prevailing
party obtaining final judgment in such action shall be entitled to receive from
the non-prevailing party reasonable attorneys’ fees incurred by reason of such
action and all costs of suit and
preparation thereof at both trial and appellate levels. This Agreement
shall be governed by and construed
and enforced in accordance with applicable federal law and the laws of the State of California. In addition,
any such suit or proceeding shall be brought in the federal or state courts located in Los Angeles
County, California, which courts shall have sole and exclusive in personam,
subject matter and other jurisdiction in connection with such suit or proceedings,
and venue shall be appropriate for all purposes in such courts.


 


17. NO REMEDY EXCLUSIVE-WAIVER


 


No
remedy under this Agreement is exclusive of any other available remedy, but
each remedy shall be cumulative and shall be in addition to other remedies
given under this Agreement or existing at law or in equity.


 


Any
forbearance by a party to
this Agreement in exercising any right
or remedy
under this Agreement or otherwise afforded by applicable law shall not be a
waiver or preclude the exercise of that or any other right or remedy.


 


18. NOTICE


 


Unless
otherwise provided in this Agreement, all notices under this Agreement shall be
in writing, deemed effective upon receipt and addressed as indicated
below.


 


	
  TO:

  	
  Countrywide
  Home Loans, Inc.

  	
  TO:

  	
  Lender/Seller

  
	
   

  	
  Correspondent
  Lending Division

  	
   

  	
  HOME
  LOAN CENTER

  
	
   

  	
  450
  American Street

  	
   

  	
  2010
  Main St.

  
	
   

  	
  Mail
  Stop No. SV3-51

  	
   

  	
  IRVINE,
  CA 92614

  
	
   

  	
  Simi
  Valley, California 93065

  	
   

  
	
   

  	
  Attention:
  Vice President of Production

  	
   

  



 


	
  ACCEPTED BY:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  COUNTRYWIDE
  HOME LOANS, INC.

  	
  SELLER:

  	
   

  	
  Home
  Loan Center

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  /s/
  Catherine A. Kaiser

  	
   

  	
  By:

  	
   

  	
  /s/
  Anthony Hsieh

  
	
   

  	
   

  	
  SIGNATURE

  	
   

  	
   

  	
   

  	
  SIGNATURE

  
	
  Name:

  	
   

  	
  Catherine
  A. Kaiser

  	
   

  	
  Name:

  	
   

  	
  Anthony
  Hsieh

  
	
  Title:

  	
   

  	
  Senior
  Vice President

  	
   

  	
  Title:

  	
   

  	
  CEO

  
	
  Dated:

  	
   

  	
  May
  15, 2002

  	
   

  	
  Dated:

  	
   

  	
  4/16/02

  



 


6

















 


Addendum to Loan
Purchase Agreement


 


MANDATORY COMMITMENTS (BULK SALES)


 


This Agreement (the “Addendum”) constitutes
an Addendum to that Loan Purchase Agreement dated 4-16, 2002 by and between
Countrywide Home Loans, Inc., a New York Corporation (“Countrywide”), and
Home Loan Center  a           (“Seller”) (the “Agreement”).


 


This
Addendum is for the purpose of setting forth the obligations of the Seller to
Countrywide in accordance with Countrywide’s mandatory commitment program,
which is further described in the Seller’s Manual. The terms and conditions of
the Loan Purchase Agreement are incorporated herein by reference. This Addendum
shall modify, amend, and form a part of the terms of the Agreement. All terms contained herein  shall have the same meaning as in the
Agreement, unless otherwise defined herein. In the event of any conflict
between the terms and conditions of the Agreement and this Addendum as it
pertains to the mandatory commitment program, the terms and conditions of this
Addendum shall prevail.


 


GENERAL


 


Sellers
may elect to deliver loans to Countrywide under the mandatory commitment
program by entering into a mandatory delivery commitment (a “Commitment”) to
deliver a specified amount and type of loan on or before a specified date.
Under the mandatory commitment program, the Seller shall be obligated to pay a
mark-to-market pair-off fee if the Seller fails to deliver qualifying loans by
the date specified in the Commitment (the “Commitment Expiration Date”), in the
amount specified in the Commitment (the “Commitment Amount”), or otherwise
under the terms provided in the applicable Commitment.


 


I. PAIR-OFF ASSESSMENT


 


Pair-off
fees shall be assessed as of the dates and times (the “Pair-Off
Assessment Date”) provided for:


 


(a)  as of the date and time
that the Seller notifies Countrywide of its election for a reduction of any
portion of the Commitment Amount; or


 


(b) as of the date and time that the Seller notifies Countrywide of its
election for a program substitution as described in the Seller’s
Manual for any portion of the mandatory commitment (such substitution to be
treated as a reduction of the Commitment Amount); or


 


(c)  as of the close of the Commitment Expiration Date if qualifying loan
files are not delivered by seller in an amount equal to the Commitment Amount,
less the allowable delivery variance provided for in the Commitment; or


 


(d) as of the close of business on such date subsequent to the Commitment
Expiration Date that Countrywide determines that a loan delivered by the
Commitment Expiration Date was not eligible for purchase.


 


II. PAIR-OFF CALCULATION AND PAYMENT OF PAIR-OFF FEES


 


The
pair-off fee shall be assessed and calculated as provided:


 


(a) A pair-off fee  shall be assessed should the Seller notify Countrywide of its election
to pair-off all or a portion of the Commitment Amount prior to the Commitment
Expiration Date pursuant to the provisions of paragraphs I(a) and I(b) above.
In such event, the Commitment shall be amended to require Seller to deliver, and for Countrywide to purchase, the
original Commitment Amount reduced by the amount paired-off by Seller (the “Amended
Commitment Amount”) with all other terms of the Commitment remaining unchanged.
Any such  amount which Seller elects
to pair-off shall hereinafter be referred to as the “Amount Paired-Off By
Seller.”


 


(b) A pair-off fee shall be assessed should
Seller fail to deliver qualifying loans by the Commitment Expiration Date with
an aggregate principal balance equal to the Commitment Amount or the Amended Commitment Amount applicable, less the allowable delivery variance provided for in
the Commitment. Any such  shortfall in the delivery of qualifying loans
by the Commitment Expiration Date shall be hereinafter referred to as the “Delivery
Shortfall Amount.”


 


(c) The pair-off fee  to be assessed on Amounts
Paired-Off by Seller and Delivery
Shortfall Amounts shall be calculated by multiplying the Amount Paired-Off by
Seller or Delivery Shortfall Amount, as applicable, by a percentage equal to
the sum of .125% (the “Administrative Fee”), plus the positive price
difference, if any, between the percentage price posted by Countrywide as of
the Pair-Off Assessment Date (on the loans which were the subject of
the Commitment), and the percentage price to have been paid by Countrywide
pursuant to the Commitment. Countrywide’s posted percentage price on the Pair-Off Assessment Date shall be
determined as follows:


 


i.    if the Pair-Off Assessment Data is the Commitment Expiration Date, or a subsequent
date, pursuant to paragraph I(c) and
(d) above, the posted
percentage price to be used
shall be that percentage price posted by Countrywide


 


	
  

  	
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applicable to the earliest delivery option available
on such Pair-Off Assessment Date (e.g., the price for a mandatory 2 day
delivery).


 


ii.   If the Pair-Off
Assessment Date is earlier than the Commitment Expiration Date pursuant to paragraphs I (a) or I (b), then the
posted price to be used shall be the posted
mandatory delivery price applicable to the delivery period option which expires closest to, but not after the
Commitment Expiration Date. For example, if the Pair-Off Assessment Date is 40
days prior to the Commitment Expiration Date, the posted price to be used for
the pair-off fee calculation shall be Countrywide’s 29 day mandatory delivery
price on the Pair-Off Assessment Date. (for purposes of this example, available
mandatory delivery periods are: 2, 7, 15, 29, 45, 60 and 75 days.)


 


(d) Notwithstanding the provisions of paragraph II (c) above, the
administrative fee shall be a minimum of $100.


 


(e)  The pair-off fees assessed hereunder shall be
due and payable within five (5) business days after the Pair-Off
Assessment Date. In addition to Countrywide’s other remedies, if pair-off fees are not paid within this time
period, Seller agrees that Countrywide
shall be entitled to net and offset such fees against other amounts owed by Countrywide to
Seller.


 


AUTHORIZED AGENTS


 


The following person(s) have been authorized by appropriate resolution of Seller
to execute this Addendum and all documents necessary and appropriate to bind Seller pursuant
to the terms of this Addendum. Countrywide may rely on any instructions
received from such person(s) and the same shall be fully binding on Seller until such time as
Countrywide shall receive written instructions revoking the authority of such
person to bind Seller to any future transactions.


 


	
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  4.

  	
   

  	
   

  



 


COUNTRYWIDE HOME LOANS, INC. (“BUYER”)


 


	
  BY: 

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  TITLE:

  	
   

  	
  Senior
  Vice President

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  DATE:

  	
   

  	
  May 15,
  2002

  	
   

  



 


(“SELLER”)


 


	
  BY:

  	
   

  	
  [ILLEGIBLE]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  TITLE:

  	
   

  	
  [ILLEGIBLE]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  DATE:

  	
   

  	
  [ILLEGIBLE]

  	
   

  



 


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Addendum to Loan Purchase Agreement for Junior Loans


 


This Addendum, is made this 16
day of APRIL, 2002 between Countrywide Home Loans, Inc., (“Countrywide”),
and HOME LOAN CENTER (“Seller”), to the Loan Purchase Agreement (“LPA”) dated
as of 4/16.


 


1.             For the purposes of the sale of loans secured
by liens that are other than senior liens (“Seconds”), including home equity
lines of credit (“HELOCs”) and fixed rate loans secured by junior liens, all
provisions of the LPA shall be applicable and remain valid, binding and in full
force and effect, except as specifically modified herein. For the purposes of
the sale of all Loans other than Seconds, the provisions of the LPA as they
currently exist without the modifications provided herein shall remain valid,
binding and in full force and effect. The provisions in this Addendum shall
have no effect upon the applicability of the LPA to Loans other than Seconds.


 


2.             Wherever in the LPA the term “note” is used, the term shall include home equity
credit line agreements, and agreements of similar import. Wherever in the LPA
the term “manual” is used, the term “Guide”
shall be used in its stead.


 


3.             For the purposes of HELOCs, the first sentence of Section 6.A.(3) of the LPA
is amended and restated in its entirety as follows: “The full amount of the
draw indicated on the Authorization to Pay (as indicated in the Guide)
delivered to Lender, and no other amount, has been fully funded to the
borrower.”


 


4.             Section 6.A.(9) of the LPA is amended and restated in its entirety as
follows: “(9) There is in force for the Loan either (a) a paid-up
valid and enforceable lenders title insurance policy on the Loan insuring
Seller, its successors and assigns, issued by a Countrywide approved title
company, as to the first or second priority lien position,
as applicable, in full compliance with all requirements in the Guide, (b) an
attorney’s mortgage lien opinion, or (c) if permitted under the
requirements specified in the Guide, a title guarantee or title search.”


 


5.             Section 6.A.(18) of the LPA is added to the LPA as follows: “(18) If the Loan is in a
second lien position, none of the documents evidencing, securing or otherwise
relating to the mortgage loan in first
lien position in any way restricts or prohibits the borrower(s) from
obtaining the Loan or from creating any of the liens granted as security for
the Loan and the Loan does not violate any term or condition imposed by any
such document.”


 


6.             Section 6.B.(1) of the LPA is hereby
amended and restated in its entirety as follows: “(1) Seller is duly
organized, validly existing and in good standing under the laws of its state of
incorporation and is qualified and/or licensed as necessary to transact
business, including the originating and selling of each Loan, including without
limitation, with rates of interest, loan type and other terms provided in the
Loan documents, and is in good standing in each state where property securing a
Loan is located.”


 


7.             All references in Section 8 of the
LPA to “servicing release premium” are replaced with “premium paid to Seller by
Countrywide at the time of its purchase
of the Loan”.


 


8.             The following is added as Sections 8.A.4a, and
8.B.4a and 8.C.4a: “any un-reimbursed advances made by Countrywide with respect
to such Loan, including but not limited to payments authorized by the loan
documents or law to protect the security interest; plus”, and Sections 8.A(1),
8.B(1) and 8.C(1) are amended and restated in their entirety as follows: “The
repurchase price shall be the original purchase price, less principal reduction
made since the Closing Date.”


 


The parties hereto do hereby agree to the foregoing as of the
date above first written.


 


 


	
  SELLER:

  	
    Home Loan Center

  	
   

  	
  COUNTRYWIDE HOME LOANS, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  a: 

  	
    California Corporation

  	
   

  	
  A NEW YORK CORPORATION

  
	
   

  	
   

  	
   

  	
   

  
	
  BY:  

  	
    /s/ [ILLEGIBLE]

  	
   

  	
  BY:

  	
  /s/ Catherine A. Kaiser

  
	
   

  	
    SIGNATURE 

  	
   

  	
   

  	
  SIGNATURE 

  
	
  NAME: 

  	
    Anthony Hsieh

  	
   

  	
  NAME:

  	
  Catherine A. Kaiser

  
	
   

  	
   

  	
   

  	
   

  
	
  TITLE:

  	
    CEO

  	
   

  	
  TITLE:

  	
  Senior Vice President

  
										



 


	
  

  	
  [ILLEGIBLE]

  	
   

  



 


1

















 


Addendum to Loan Purchase Agreement - Subprime


 


This Addendum, is made this 16
day of APRIL, 02  between Countrywide
Home Loans, Inc., (“Countrywide”) and Home Loan Center (“Seller”)
to the Loan Purchase Agreement (“LPA”) dated as of 4/16.


 


1. Definitions. The terms “Subprime Loan”, “Mortgage Loan Schedule”, “Commitment”, “Commitment
Letter”, “Pool Commitment”, “Spot Commitment” and “Closing Date” shall have the
meanings set forth therefor in the “Guide” (as defined below).


 


2. Commitment to Purchase Loans. The following is hereby added at the end of
the first sentence of Section 2: “except that for the purposes of Subprime
Loans, the procedure pursuant to which Seller may commit to sell a Subprime Loan to Countrywide is detailed in the Subprime section
of the Guide.”


 


3. Representations and Warranties.


 


A.  Section 6.A (7) is amended and restated in its entirety as
follows: “All federal and state Laws, rules and regulations applicable to the
Loan for its applicable Loan Type have been complied with, including but not
limited to: the Real Estate Settlement Procedures Act, the Flood Disaster
Protection Act, the Federal Consumer Credit Protection Act
including the Truth-in-Lending and Equal Credit Opportunity Acts, the Federal
Fair Housing Act, the Home Ownership and Equity Protection Act
of 1994 and all applicable federal and state statutes or regulations governing
fraud, lack of consideration, unconscionability, consumer credit transactions,
consumer protection, interest or other charges, licensing and mortgage insurance.”


 


B.   Section 6.B (1) is amended and restated in its entirety  as follows: “Seller is duly
organized, validly existing and in good standing under the laws of its state of
incorporation and is qualified and/or licensed as necessary to transact business, including the originating and selling of each Loan,
including without limitation, with rates of interest, loan type and other terms
provided in the Loan documents, and is in good standing in each state where
property securing a Loan is located.”


 


C.   Section 6.A (18) is added as follows: “For
each Subprime Loan, all information regarding such Subprime Loan in the
Confirmation therefor and the Mortgage Loan Schedule attached to such
Confirmation is true and correct,”


 


4. Purchase Limitation. The obligation to purchase any Subprime Loans
identified in a Confirmation does not extend to any Loans that would violate
any representation and warranty by Seller contained in the LPA.


 


5. Purchase Price. The purchase price of each Subprime Loan shall be calculated by multiplying the unpaid
principal balance of each Subprime Loan (as adjusted for the borrower’s next
payment) on the Closing Date by its applicable purchase price percentage
calculated in accordance with the rate sheet at the time of purchase for “Spot”
Commitments, or as stated in the Commitment letter for “Pool” Commitments (the “Purchase Price”). If a borrower’s
payment is due 15 days or earlier after the Closing Date (an “Early Payment”),
the portion of such payment attributable to principal shall be deducted from
the unpaid principal balance for  calculating the Purchase Price. Seller shall
then retain borrower’s Early Payment when made. The purchase proceeds paid by
Countrywide to Seller shall consist
of the Purchase Price plus accrued interest as of the Closing Date and less (i) any
positive escrow balances, and (ii) any amounts actually owed and paid by Seller
for Mortgage Loan tax service contracts and flood certification determinations
which are transferable and transferred to Countrywide on the Closing Date.
Without limitation on Countrywide’s other rights herein, the Purchase Price is
subject to change if it is determined that the loan characteristics of the
Subprime Loan to be purchased differ from the characteristics represented on
the Mortgage Loan Schedule


 


6. Premium Recapture. Should any Borrower prepay a Subprime Loan
during the twelve month period following Countrywide’s purchase of the loan,
Seller shall reimburse Countywide, upon demand, some or all of the purchase
price premium above par paid by Countrywide. The reimbursement shall be calculated
using the following formula for “Spot” commitments and “Pool” commitments
unless stated otherwise in the “Pool” commitment letter:


 




	
  Purchase Price Premium

  paid by Countrywide

  	
   

  	
  x

  	
   

  	
  12 minus the number of months expired since the date
  of purchase 12

  	
   

  	
  –

  	
   

  	
  Prepay Penalty

  	
  =

  	
  Premium Refund

  






 


7. Seller’s Repurchase Obligations. Section 7.A (4) is amended
and restated in its entirety as follows; “If the first payment due Countrywide
is not received by Countrywide, whether
from the borrower directly or
forwarded by Seller if the Borrower has submitted the payment to Seller,
within 90 days of the first payment due Countrywide. For this purpose a
Borrower shall be considered to be 90 days delinquent with respect to the first
monthly payment due Countrywide if the payment is not received by Countrywide


 


	
  

  	
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within
three months of the payment due date, regardless of the number of days in the
month. For example, if the due date of the first payment due to Countrywide is January 15th and the
Borrower has not made his/her January 15th
payment by April 14th, the Borrower shall be considered 90 days delinquent
with respect to the January 15th payment. Seller shall not have the right
to advance funds for or on behalf of a Borrower for any delinquent payment or
to otherwise
make funds available to any
Borrower to avoid or cure a default by the
Borrower. A payment for which
Countrywide deducted funds at the time it purchased the Loan from Seller shall
not be considered the first payment due Countrywide,”


 


8. Repurchase Price. For the purposes of determining
the repurchase price of a Subprime Loan, Sections 8.A(4), 8.B(4) and 8.C(4) are
deleted, and Sections 8.A(1), 8.B(1) and 8.C(1) are amended and
restated in their entirety as follows: “The repurchase price shall be the original Purchase Price (as defined in
this Addendum), less principal reduction made since the Closing Date.”


 


9. Sellers Guide. All references to “Countrywide’s Correspondent Lender Division Loan
Purchase Program Seller’s Manual” or “Manual” throughout the LPA are replaced with
“Countrywide’s Correspondent Lending Seller’s Guide” or “Guide”, respectfully.
Seller acknowledges receipt of the Guide, which may be amended, modified or
supplemented from time to time by Countrywide, in its sole and absolute discretion, which amendments,
modifications or supplements shall be effective upon Countrywide’s sending the
same to Seller.


 


10. Brokers. Neither party has employed or otherwise engaged, nor shall employ, or
otherwise engage, any broker or finder in connection with the negotiation or
execution of the LPA, this Addendum or any Commitment, nor with respect to the
transactions contemplated by this
Addendum, in such a manner as to give rise to any claim, against any party, for
any brokerage commission, finder’s fee or
similar payment. Each party shall indemnify and defend the other party for any
claims for
brokerage commission, finder’s fee
or similar payment based upon statements or agreements alleged to have been made by the indemnifying party.


 


11. LPA
Terms. All provisions of the
LPA shall be applicable and remain valid, binding and in full force and effect,
except as specifically modified herein.


 


The parties hereto do hereby agree to the foregoing as of the date above first
written.


 


 


	
  SELLER:

  	
  COUNTRYWIDE:

  
	
   

  	
   

  
	
  Home Loan Center

  	
   

  	
  COUNTRYWIDE HOME LOANS, INC.

  
	
  a:

  	
  California Corporation

  	
   

  	
  A NEW YORK CORPORATION

  
	
  By:

  	
  /s/ Anthony Hsieh

  	
   

  	
  By:

  	
  /s/ Catherine A. Kaiser

  
	
   

  	
  SIGNATURE

  	
   

  	
   

  	
  SIGNATURE

  
	
  Name:

  	
  Anthony Hsieh

  	
   

  	
  Name:

  	
  Catherine A. Kaiser

  
	
  Title:

  	
  CEO

  	
   

  	
  Title:

  	
  Senior Vice President

  
								



 


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