Exhibit 10.14


 


FLEXIBLE
EARLY PURCHASE FACILITY

(Repo Contract)


 


MORTGAGE LOAN REPURCHASE AGREEMENT


 


THIS MORTGAGE LOAN REPURCHASE AGREEMENT (“Agreement”),
dated as of May 27, 2005, is by and between WASHINGTON MUTUAL BANK, a
federal association (“Washington Mutual”) and SIRVA MORTGAGE, INC., an Ohio corporation f/k/a Cooperative Mortgage
Services, Inc. (“Seller”).


 


Recitals


 


A.            Seller originates residential whole
mortgage loans and sells such loans to one or more Takeout Investors (as
defined herein) pursuant to purchase agreements and related purchase
commitments.


 


B.            A sale of mortgage loan to a Takeout
Investor is normally completed some days or weeks after the mortgage loan was
originated.  The period of time between
the origination of the mortgage loan and sale of it to the Takeout Investor is
referred to herein as the “Post-Origination Period.”  Normally the Post-Origination Period does not
exceed ninety (90) days.  During the
Post-Origination Period, Seller continues to service the mortgage loan, Seller
assembles documents and information concerning the mortgage loan and submits
related files, and the Takeout Investor reviews the files for compliance with
the applicable requirements.  Seller
normally completes the sale of the mortgage loan to the Takeout Investor
one (1) Business Day after the investor approves the files and
determines that all other conditions precedent to the sale have been satisfied
or waived.  The sale of the mortgage loan
to the investor may be completed on a servicing-released basis.


 


C.            Washington Mutual now wishes to offer to
purchase certain qualifying mortgage loans after such a mortgage loan has been
originated, on a servicing-retained basis, subject to Seller’s obligation to
repurchase the mortgage loan and further subject to the terms and conditions of
this Agreement.


 


Agreement


 


1.             Definitions. 
The following definitions apply (except to the extent such definitions
are modified in an Annex):


 


“Acquisition Date” means, with respect to any Mortgage Loan, the date of
payment by MBF to Seller of the Acquisition Price.


 


“Acquisition Price” means, with respect to each Mortgage Loan, an amount
equal to the percentage specified in Annex 1 of the amount which
the Takeout Investor has provisionally


 

















 


committed to pay for such
Mortgage Loan in its Takeout Commitment, but in no event more than the Par
Value of the Mortgage Loan.


 


“Act of Insolvency” means (a) the commencement by
Seller or Guarantor as debtor of any case or proceeding under any bankruptcy,
insolvency, reorganization, liquidation, dissolution or similar law, or a
request by Seller or Guarantor for the appointment of a receiver, trustee,
custodian or similar official for Seller or Guarantor or any substantial part
of its property; (b) the commencement of any such case or proceeding
against Seller or Guarantor, or another’s seeking such appointment, or the
filing against Seller or Guarantor of an application for a protective decree
which (i) is consented to or not timely contested by Seller or Guarantor,
or (ii) results in the entry of an order for relief, such an appointment,
the issuance of such a protective decree or the entry of an order having a
similar effect, or (iii) is not dismissed within sixty (60) days; (c) the
making by Seller or Guarantor of a general assignment for the benefit of
creditors; or (d) the admission in writing by Seller or Guarantor that it
is unable to pay its debts as they become due, or the nonpayment of its debts
generally as they become due.


 


“Adjusted Tangible Net Worth” means, with respect to any Person at any
date, the sum of the Tangible Net Worth of such Person at such date, plus one
percent (1%) of the unpaid principal balances of all Mortgage Loans at such
date for which such Person owns the servicing rights, plus the unpaid principal
amount of all Subordinated Debt of such Person at such date.


 


“Administrative Costs” means those fees, charges and expenses
listed on Exhibit A.


 


“Affiliate” means, as to a specified Person, any
other Person (a) that directly or indirectly through one or more intermediaries
controls, is controlled by or is under common control with the specified
Person; (b) that is a director, trustee, general partner or executive
officer of the specified Person or serves in a similar capacity in respect of
the specified Person; (c) that, directly or indirectly through one or more
intermediaries, is the beneficial owner of ten percent (10%) or more of any
class of equity securities of the specified Person; or (d) of which the
specified Person is directly or indirectly the owner of ten percent (10%) or
more of any class of equity securities.


 


“Agencies” means FHA, FNMA, GNMA, FHLMC and VA.


 


“Agency Guidelines” means those requirements, standards and
procedures which may be adopted by the Agencies from time to time with respect
to their purchase or guaranty of residential mortgage loans, which requirements
govern the Agencies’ willingness to purchase and/or guaranty such loans.


 


“Agreement” is defined in the preamble.


 


“Annual Reporting Date” is defined in Annex 1.


 


“Assignment in Blank” means each assignment of mortgage in
recordable form and otherwise in form and substance satisfactory to MBF,
executed in blank by Seller and delivered to MBF as part of the Dry Funding
Documents Package or the Wet Funding Documents Package.


 


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“Bailee Letter” means a letter substantially in the form
of Exhibit K, or such other form as may be acceptable to MBF in its
sole discretion, pursuant to which it will release a Mortgage Note to another
Person before it has received the Repurchase Price proceeds for the related
Mortgage Loan.


 


“Business Day” means any day other than a Saturday,
Sunday or other day on which MBF is closed for business.


 


“Capitalized Lease” means any lease under which rental
payments are required to be capitalized on a balance sheet of the lessee in
accordance with GAAP.


 


“Capitalized Rentals” means the amount of aggregate rentals
due and to become due under all Capitalized Leases under which Seller is a
lessee that would be reflected as a liability on a balance sheet of Seller.


 


“CL” means Washington Mutual,
operating through its unincorporated division commonly known as its
Correspondent Lending group.


 


“CL Program” means Washington Mutual
Correspondent Lending Program pursuant to which it may act as a Takeout
Investor and purchase mortgage loans.


 


“Compliance Certificate” means a
compliance certificate substantially in the form of Exhibit H,
completed, executed and submitted by Seller pursuant to subsection 13.7(c) and
satisfactory in form and substance to MBF.


 


“Confidential Information” means, with
respect to a party, information
about hardware, software, screens, specifications, designs, plans, drawings,
data, prototypes, discoveries, research, developments, methods, processes, procedures,
improvements, “know-how”, compilations, market research, marketing techniques
and plans, business plans, programs and strategies, customer names and all
other information related to customers, price lists, pricing policies and
financial information or other business and/or technical information and
materials, in oral, demonstrative, written, graphic or machine-readable form,
which is unpublished, not available to the general public or trade, and
maintained as confidential and proprietary information by the disclosing party
for regulatory, customer relations, and/or competitive reasons.  Confidential Information also includes such
confidential and proprietary information or material belonging to a disclosing party
or to which the other party may obtain knowledge or access through or as a
result of the performance of its obligations under the Agreement.  Confidential Information also includes any
information described above which the disclosing party has obtained in
confidence from another party who treats it as proprietary or designates it as
Confidential Information, whether or not owned or developed by the disclosing
party.  Without limiting the foregoing,
Confidential Information includes all such information provided to each party
by the other party both before and after the date of this Agreement and also
includes the terms of this Agreement.


 


“Credit File” means, with respect to a
Mortgage Loan, all of the paper and documents required to be maintained
pursuant to the related Takeout Commitment, and all other papers and records of
whatever kind or description, whether developed or created by Seller or others,
required to originate, document or service the Mortgage Loan.


 


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“Current Assets” means, with respect to any person at any
date, those assets set forth in the consolidated balance sheet of the Person,
prepared in accordance with GAAP, as current assets, defined as those assets
that are now cash or will be by their terms or disposition be converted to cash
within one year of the date of calculation.


 


“Current Liabilities” means, with respect to any person at any
date, those liabilities set forth in the consolidated balance sheet of the
Person, prepared in accordance with GAAP, as current liabilities, defined as
those liabilities due upon demand or within one year from the date of
calculation.


 


“Current Ratio” means, with respect to any person at any
date, the sum of the amounts set forth in the consolidated balance sheet of the
Person, prepared in accordance with GAAP, as Current Assets divided by the sum
of the amounts set forth in such consolidated balance sheet as Current
Liabilities.


 


“Custodial Account” is defined in Section 5.2.


 


“Debt” means, with respect to any Person, at any date (a) all
indebtedness or other obligations of
such Person which, in accordance with GAAP, would be included in determining
total liabilities as shown on the liabilities side of a balance sheet of such
Person at such date; and (b) all indebtedness or other obligations of such
Person for borrowed money or for the deferred purchase price of property or
services; provided, however, that, for purposes of this
Agreement, there shall be excluded from Debt at any date loan loss reserves,
deferred taxes arising from capitalized excess service fees, operating leases
and Subordinated Debt.


 


“Default” means the occurrence or non-occurrence of any event
that, with the giving of notice, the lapse of time, or both, would become an
Event of Default.


 


“Default Rate” means four percent (4%) per annum over
the Investment Return Rate.


 


“Defective Mortgage Loan” means a Mortgage Loan (i) that does
not conform to any one or more of the representations or warranties made by
Seller pursuant to Section 11, (ii) that is sold in a transaction in which
any one or more of the representations and warranties of Seller contained in Section 12
are not true, correct and complete on the Acquisition Date, (iii) that is
subject to a Takeout Commitment with respect to which Seller is in default, (iv) that
is rejected or excluded for any reason (other than default by MBF) from the
related Takeout Commitment by the Takeout Investor, (v) that is not
purchased by the Takeout Investor in compliance with the Takeout Commitment and
this Agreement at or prior to the expiration or termination of the Takeout
Commitment for any reason (other than default by MBF), or (vi) is not
repurchased by Seller in compliance with the provisions of Section 7.


 


“Dry Funding Documents Package” means, with respect to any Mortgage
Loan, the applicable documents designated as such on Exhibit D,
each in form and substance satisfactory to MBF in its sole discretion.


 


“Early Repurchase Date” is defined in Section 8.2(b).


 


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“Effective Date” means the date this Agreement is executed by both
parties (which shall conclusively be deemed to be the date appearing in the
preamble absent manifest error), unless a contrary intent specifically appears
herein.


 


“Electronic Tracking Agreement” means the Electronic Tracking Agreement
substantially in the form set forth as Exhibit J hereto, by and
among MBF, Seller, MERS and MERSCORP, Inc. (the “Electronic Agent”), as
the same shall be amended, supplemented or otherwise modified from time to
time.


 


“Eligible Bank” means a bank selected by Seller and approved by MBF
in writing and licensed to conduct trust and other banking business in any
state  in which Seller conducts
operations.


 


“ERISA” means the Employee Retirement Income
Security Act of 1974 and all rules and regulations promulgated thereunder,
as amended from time to time and any successor statute.


 


“Event of Default” means any of the following events shall have occurred
and be continuing:


 


(i)            Seller fails to remit any sum due to MBF
under subsection 5.2(c) or Section 6.2 on a Remittance Date; or


 


(ii)           Seller fails to repurchase any Mortgage
Loan at the time and for the amount required under Section 7.3 or Section 8.2;
or


 


(iii)          in
any thirty (30) day period, MBF requires Seller to repurchase Mortgage Loans
pursuant to Section 8.2 having an aggregate Repurchase Price in excess of
$1 million; or


 


(iv)          any representation or warranty made by
Seller in connection with this Agreement or contained herein is inaccurate or
incomplete in any material respect on or as of the date made or hereafter
becomes untrue; or


 


(v)           Seller fails in the observance or
performance of any duty, responsibility or obligation contained in this
Agreement, other than a duty to remit on a Remittance Date or to repurchase a
Mortgage Loan, and such failure continues unremedied for a period of thirty
(30) days; or


 


(vi)          any Act of Insolvency occurs; or


 


(vii)         one
or more judgments or decrees are entered against Seller involving claims not
paid or not fully covered by insurance and all such judgments or decrees are
not vacated, discharged, or stayed or bonded pending appeal within sixty (60)
days from entry thereof; or


 


5

















 


(viii)        any
Agency, or private investor, or any other party seizes or takes control of
Seller’s servicing portfolio, for breach of any servicing agreement applicable
to such servicing portfolio or for any other reason whatsoever; or


 


(ix)           any Agency or Regulatory Authority
revokes Seller’s authority to originate Mortgage Loans; or


 


(x)            Seller defaults under the warehouse
credit agreement, if any, that Seller holds with MBF as Warehouse Lender;


 


(xi)           Seller or any of its Subsidiaries fails
to pay when due any other Indebtedness beyond any period of grace provided, or
there occurs any breach or default with respect to any material term of any
other Indebtedness, if the effect of such failure, breach or default is to
cause, or to permit the holder or holders thereof (or a trustee on behalf of
such holder or holders) to cause, Indebtedness of Seller or one of its
Subsidiaries in the aggregate amount equal to or greater than the amount
specified in Annex 1 to become or be declared due prior to its
stated maturity including any agreed upon extension (upon the giving or
receiving of notice, lapse of time, both, or otherwise);


 


(xii)          there
is a Material Adverse Change; or


 


(xiii)         Seller
defaults under any mortgage loan repurchase arrangement similar to this
Agreement which it may have with any other party, under any mortgage loan
purchase arrangement which it may have with any party under which Seller sells
mortgage loans (including, if applicable, a purchase and sale contract with MBF
itself), or under any warehouse lending or correspondent lending arrangement
which may support its residential loan program, beyond applicable notice and
grace periods.


 


“FDIC” means the Federal Deposit
Insurance Corporation or
any successor.


 


“FHA” means the organization known as the Federal Housing
Association or any successor.


 


“FHLMC” means the organization known as the Federal Home Loan
Mortgage Corporation or any successor.


 


“FNMA” means the organization known as the Federal National
Mortgage Association or any successor.


 


“GAAP” means generally accepted accounting principles in the
United States consistently applied.


 


“GLB Act” means the Gramm-Leach Bliley Act of 1999
(Public Law 106-102, 113 Stat 1138), as it may be amended from time to time.


 


“GNMA” means the organization known as the Government
National Mortgage Association or any successor.


 


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“Guarantor” means the Person, if any, specified in Annex 1.


 


“Guaranty” means a Guaranty substantially in the
form of Exhibit G, executed by Guarantor and delivered pursuant to Section 3.1.


 


“Hedging Arrangement”
means any forward sales contract, forward trade contract, interest rate swap
agreement, interest rate cap agreement, or other contract pursuant to which
Seller has protected itself from the consequences of a loss in the value of a
Mortgage Loan because of changes in interest rates or in the market value of
mortgage loan assets.


 


“Indebtedness” means and includes, without duplication,
(i) all items which in accordance with GAAP, consistently applied, would
be included on the liabilities side of a balance sheet on the date as of which
Indebtedness is to be determined (excluding shareholders’ equity), (ii) Capitalized
Rentals under any Capitalized Lease, (iii) guaranties, endorsements and
other contingent obligations in respect of, or any obligations to purchase or otherwise
acquire, indebtedness of others, and (iv) indebtedness secured by any
mortgage, pledge, security interest or other Lien existing on any property
owned by the Person with respect to which indebtedness is being determined,
whether or not the indebtedness secured thereby shall have been assumed.


 


“Interim Date” is defined in Annex 1.


 


“Investment Return Rate” means the LIBOR Rate plus the number of
basis points specified in Annex 1.


 


“LIBOR Rate” means the rate of interest equal to the
London Interbank Offered Rate for U.S. dollar deposits for an interest period
of one (1) month as quoted or published by Telerate, Bloomberg or any
other rate quoting service, selected by MBF in its sole discretion for an
interest period of one (1) month, effective two (2) Business Days
from the date of quotation.  In the event
such rate quoting service ceases to be selected by MBF, MBF’s determination of
the LIBOR Rate shall be conclusive and binding on Seller absent manifest error.


 


“Lien” means any lien, mortgage,
deed of trust, pledge, security interest, charge or encumbrance of any kind
(including any conditional sale or other title retention agreement, any lease
in the nature thereof, and any agreement to give any security interest.)


 


“Litigation” means,  as to any Person, any action, lawsuit, investigation,
claim, proceeding, judgment, order, decree or resolution pending or threatened
against or affecting such Person or the business, operations, properties or
assets of such Person before, or by, any Regulatory Authority.


 


“Loan Purchase Detail” means a loan purchase detail,
transmitted by facsimile in the form of Exhibit B (and as MBF may
change said form from time to time) or transmitted electronically in an
appropriate data layout, prepared by Seller, containing certain information
regarding the characteristics of all Mortgage Loans being offered for sale by
Seller to MBF on a particular Business Day.


 


“Loan Sale Confirmation” means, with respect to each Mortgage
Loan purchased by MBF from Seller, a sale confirmation confirming the
completion of MBF’s purchase of such 


 


7

















 


Mortgage Loan, prepared
by Seller and delivered to MBF by facsimile in the form of Exhibit C
(and as MBF may change said form from time to time) or delivered electronically
in an appropriate data layout.


 


“Margin Stock” has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve Systems as
in effect from time to time.


 


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


 


“Material Adverse Change” means any (i) material adverse
effect upon the validity, performance or enforceability of this Agreement or
the Guaranty (if any), (ii) material adverse effect upon the properties,
business or condition, financial or otherwise, of Seller or Guarantor (if any),
or (iii) material adverse effect upon the ability of Seller to fulfill its
obligations under this Agreement or the ability of Guarantor (if any) to
fulfill its obligations under the Guaranty (if any).


 


“Maximum Takeout Commitment
Expiration Date”
is defined in Annex 1.


 


“MBF” means Washington Mutual, operating through its
unincorporated division commonly known as its Mortgage Banker Finance group,
identified more completely by the contact information provided in Section 15.1.


 


“MERS” means the Mortgage Electronic Registration Systems, Inc.,
and its successors in interest.


 


“MERS Designated Mortgage Loan” means a Mortgage Loan that satisfies the
definition of the term “MERS Designated Mortgage Loan” contained in the
Electronic Tracking Agreement.


 


“MERS® System” has the meaning given that term in the
Electronic Tracking Agreement.


 


“MIN” means the eighteen digit MERS Identification Number
permanently assigned to each MERS Designated Mortgage Loan.


 


“MOM Loan” means a MERS Designated Mortgage Loan
that was registered on the MERS® System at the time of its origination and for
which MERS appears as the record mortgagee or beneficiary on the related
Mortgage.


 


“Monthly Reporting Date” is defined in Annex 1.


 


“Mortgage” means the mortgage, deed of trust or other instrument
creating a lien on an estate in real property securing a Mortgage Note.


 


8

















 


“Mortgage Loan” means any residential whole mortgage loan, originated
not more than thirty (30) days prior to delivery to MBF, that is eligible for
sale to a Takeout Investor under its Takeout Guidelines.


 


“Mortgage Note” means the note or other evidence of the indebtedness
evidencing a Mortgage Loan.


 


“Mortgage Note Rate” means the per annum rate of interest
stated in the Mortgage Note.


 


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


 


“Mortgagor” means the obligor on a Mortgage Note.


 


“NASD” means the National Association of Securities Dealers
or any successor agency or authority.


 


“OTS” means the Office of Thrift Supervision or any
successor agency or authority.


 


“Par Value” means the unpaid principal balance of a
Mortgage Loan on the date of determination.


 


“Person” means an individual, partnership, corporation,
business trust, limited liability company, joint stock company, trust,
unincorporated association, joint venture, governmental authority, or other
entity of whatever nature.


 


“Post-Origination Period” is defined in
Recital B.


 


“Property Charges” means all taxes, fees, assessments, water, sewer and
municipal charges (general or special) and all insurance premiums, leasehold
payments or ground rents.


 


“Regulatory Authority” means, with respect to any Person, any
governmental or quasi-governmental department, commission, board, regulatory
authority, bureau, agency or instrumentality, domestic, foreign, federal, state
or municipal (including, without limitation, the OTS, FDIC, SEC or the NASD),
any court or arbitration panel, or any private body having regulatory
jurisdiction over such Person or its business or assets (including any
insurance company or underwriter through whom such Person has obtained
insurance coverage).


 


“Remittance Date” means, with respect to each
Mortgage Loan, the first (1st) day of each month.


 


“Repurchase Date” means,  with respect to a Mortgage Loan, the date
that Seller remits the Repurchase Price to MBF.


 


“Repurchase Price” means, for any Mortgage Loan, the Acquisition Price
for such Mortgage Loan, plus the aggregate amount obtained by the daily
application of the Investment Return Rate to the Acquisition Price for such
Mortgage Loan on a 360-day-per-year basis for the 


 


9

















 


actual number of days in
the period from the Acquisition Date to and excluding the Repurchase Date, plus
the amount of any then-unpaid Administrative Costs with respect to such
Mortgage Loan, plus the amount of any then-unpaid Successor Servicer
Costs with respect to such Mortgage Loan, if any, plus the amount of any
accrued but unpaid Default Rate interest under subsection 5.2(g).


 


“Requirement of Law” means, with respect to any Person, any
law, ordinance, requirement, order, direction, rule, regulation, decision,
ruling, writ, injunction, instruction, resolution, decree, or other similar
document, instrument or directive, whether currently existing or promulgated
hereafter, of any Regulatory Authority, or any requirement of the
organizational documents of such Person.


 


“Scheduled Repurchase Date” means, with respect to a Mortgage Loan,
the earlier of (i) the date that is the number of days following the
Acquisition Date specified in Annex 1, and (ii) the date of
the expiration of the Takeout Commitment for such Mortgage Loan, subject to
acceleration as provided in subsection 8.3(c).


 


“SEC” means the United States Securities and Exchange
Commission or any successor agency or authority.


 


“Seller” is defined in the preamble.


 


“Seller Guide” means the Washington Mutual
Correspondent Lending Seller Guide used in the CL Program, as it may be revised
by CL from time to time.  (On the
Effective Date, the Seller Guide is available in a hard copy format from CL and
may be downloaded from CL’s website, www.wamubuys.com.)  In the event CL issues a revised version of
the Seller Guide or makes other revisions after the Effective Date which change
the chapter numbers of the Seller Guide, the references to certain chapter
number of the Seller Guide in this document shall be read as references to the
successor numbers, for the same text, in the revised Seller Guide.


 


“Seller’s Account” means Seller’s Funding
Account or Seller’s Operating Account.


 


“Seller’s Concentration Limit” means the
amount specified in Annex 1.


 


“Seller’s Funding Account” means the account established by Seller
at Washington Mutual and under the control of MBF, through which Acquisition
Prices will be paid by deposit, and amounts due from Seller to MBF may be paid
by withdrawal.


 


“Seller’s Operating Account” means the account established by Seller at
Washington Mutual and under the control of Seller, to which funds will be
transferred from Seller’s Funding Account, from time to time, through which
Servicing Fees due from MBF to Seller may be paid by deposit, and through which
amounts due from Seller to MBF may be paid by withdrawal.


 


“Seller’s Power of Attorney” means a limited power of attorney
substantially in the form of Exhibit E, executed by Seller with
regard to Mortgage Loans and delivered pursuant to Section 3.1


 


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“Servicing Fee” means, with respect to a Mortgage Loan, the sum of
all amounts deposited in the Custodial Account between the Acquisition Date and
the Repurchase Date, other than escrow payments for Property Charges.


 


“Settlement Amount” is defined in subsection 7.4(a).


 


“Shipping Instructions” mean the advice prepared by Seller and
sent to MBF by facsimile or electronically which instructs MBF to send Mortgage
Note(s) to another Person.  This
advice shall include, for each such Mortgage Note, the loan number of the
corresponding Mortgage Loan, the Mortgagor’s name, the current loan amount, and
applicable delivery instructions for the Takeout Investor.


 


“Statement Date” is defined in
subsection 3.1(c).


 


“Subordinated Debt” means, with respect to any
Person, all Indebtedness of such Person, for borrowed money, which is, by its
terms (which terms shall have been approved by MBF) or by the
terms of a subordination agreement, in form and substance satisfactory to MBF, effectively subordinated in right of
payment to all other present and future obligations and all indebtedness of
such Person, of every kind and character, owed to MBF.


 


“Subsidiary” means any corporation,
association or other business entity in which more than fifty percent (50%) of
the total voting power or shares of stock entitled to vote in the election or
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by any Person or one or more of the other Subsidiaries
of that Person or a combination thereof


 


“Successor Servicer” is defined in subsection 5.1(d).


 


“Successor Servicer Costs” means the costs incurred by MBF in
transferring the servicing of a Mortgage Loan to a Successor Servicer pursuant
to subsection 5.1(d) and all the amounts paid or payable to the
Successor Servicer for servicing the Mortgage Loan until the date on which the
Mortgage Loan is repurchased by Seller.


 


“Takeout Commitment” means an irrevocable commitment issued
by a Takeout Investor to acquire one or more Mortgage Loans on or before a
specified delivery date or expiration date, which shall in no event exceed the
Maximum Takeout Commitment Expiration Date, which shall be in form and
substance acceptable to MBF in its sole discretion.


 


“Takeout Funding” means the completion of all of the
transactions required to be completed on the Takeout Funding Date.


 


“Takeout Funding Advice” means the statement, in form and
substance acceptable to MBF, prepared either by the Takeout Investor pursuant
to the applicable Takeout Commitment or Seller, as the case may be, and
delivered to Seller or MBF on or before the Takeout Funding Date itemizing, for
a particular Mortgage Loan or group of Mortgage Loans, the aggregate net funds
that will be paid by the Takeout Investor to Seller.  This statement will identify each Mortgage
Loan to be purchased by the Takeout Investor as part of the proposed Takeout
Funding 


 


11

















 


by the Mortgagor’s name,
confirm that net amount to be disbursed at the Takeout Funding for each such
Loan, and state the Business Day on which the Takeout Funding shall occur.


 


“Takeout Funding Date” means the date on which the Takeout
Investor acquires ownership of a Mortgage Loan from Seller pursuant to the
terms of the applicable Takeout Commitment.


 


“Takeout Guidelines” means (i) the eligibility
requirements established by the Takeout Investor that must be satisfied by a
mortgage loan originator to sell mortgage loans to the Takeout Investor, and (ii) the
specifications that a mortgage loan must meet, and the requirements that it
must satisfy, for the mortgage loan to qualify for the Takeout Investor’s
program of mortgage loan purchases, as such requirements and specifications may
be revised or supplemented from time to time.


 


“Takeout Investor” means any of the investors listed on Exhibit I,
subject to such deletions from the list as MBF may hereafter make from time to
time in its sole discretion, and such other investors as may be hereafter
approved by MBF in writing from time to time in its sole discretion.  Without limitation to the foregoing, at the
request of Seller, MBF may add Washington Mutual Bank, a federal association or any Affiliate or
Subsidiary thereof, to Exhibit I if said entity conducts a mortgage
loan purchase program that Seller wishes to utilize, and, in that event, such
Washington Mutual entity shall be treated as an unrelated “Takeout Investor” by
both parties for all purposes hereunder. 
MBF may (but is not required to) issue an amended and restated Exhibit I
from time to time to reflect its deletions from and additions to this list.


 


“Tangible Net Worth” means, without
respect to any Person at any date, the sum of total shareholders’ equity in
such Person (including capital stock, additional paid-in capital, and retained
earnings, but excluding treasury stock, if any), on a consolidated basis; provided,
however, that, for purposes of this definition, there shall be excluded
from assets the following:  the aggregate
book value of all intangible assets of such Person (as determined in accordance
with GAAP), including, without limitation, goodwill, trademarks, trade names,
service marks, copyrights, patents, licenses, franchises, and capitalized
servicing rights, each to be determined in accordance with GAAP consistent with
those applied in the preparation of the financial statements referred to in
subsection 3.1(c) hereof; advances of loans to Affiliates;
investments in Affiliates; assets pledged to secure any liabilities not
included in the Debt of such Person; and those other assets which would be
deemed by the Agencies to be non-acceptable in calculating adjusted net worth
in accordance with their requirements as in effect as of such date.


 


“Term” means the period between the Effective Date and the
date on which this Agreement shall be terminated in accordance with the
provisions of Section 14.


 


“UCC” means the Uniform Commercial Code as then in effect
in the applicable jurisdiction.


 


“VA” means the organization known as the Department of
Veteran Affairs or any successor.


 


12

















 


“Warehouse Lender” means any party (including MBF) providing interim
financing to Seller in any fractional amount for the purpose of originating or
purchasing mortgage loans, which lender has a security interest in the Mortgage
Loan(s) as collateral for the obligations of Seller to such lender.


 


“Warehouse Lender’s Release” means a letter or document,
substantially in the form of Exhibit F or in such other form as MBF
may have approved in advance, from a third-party Warehouse Lender to MBF
conditionally releasing (or agreeing to release) all of said Warehouse Lender’s
right, title and interest in the Mortgage Loan(s) identified therein upon
receipt of payment by the Warehouse Lender.


 


“Warehouse Lender’s Wire Instructions” means written or electronic instructions
in form reasonably acceptable to MBF, delivered by a Warehouse Lender to MBF
and setting forth the bank wire coordinates to be used for the payment of all
amounts due and payable to such Warehouse Lender hereunder.


 


“Washington Mutual” is defined in the preamble.


 


“Wet Funding” means the purchase of a Mortgage Loan
that is originated by Seller on the Acquisition Date under escrow arrangements
satisfactory to MBF pursuant to which Seller is permitted to use the
Acquisition Price proceeds to close the Mortgage Loan.


 


“Wet Funding Deadline” means the Business Day specified in Annex 1.


 


“Wet Funding Documents Package” means, with respect to any Mortgage
Loan, the documents designated as such on Exhibit D, each in form
and substance satisfactory to MBF in its sole discretion.


 


“Wet Funding Sublimit” means the amount specified in Annex 1.


 


2.             Purchase and Sale. 
Seller agrees to sell to MBF, and MBF agrees to purchase from Seller,
from time to time, on a servicing-retained basis, Mortgage Loans on the terms
and conditions of this Agreement, subject to the obligation of Seller to
repurchase such Mortgage Loans.  In no
event shall MBF be required to purchase any Mortgage Loan if the Acquisition
Price of such Mortgage Loan, when combined with the aggregate Acquisition Price
of all Mortgage Loans purchased hereunder and then held by MBF (and then
serviced by Seller or a Successor Servicer), is in excess of the Seller’s
Concentration Limit.  In no event shall
MBF be required to purchase any Mortgage Loan in a Wet Funding if the
Acquisition Price of such Mortgage Loan, when combined with the aggregate
Acquisition Price of all Mortgage Loans purchased in Wet Fundings and then held
by MBF (and then serviced by Seller or a Successor Servicer), is in excess of
the Wet Funding Sublimit.  With respect
to any Mortgage Loans sold hereunder that were originated for sale to CL under
the CL Program, additional terms and conditions applicable to the purchase and
sale of such Mortgage Loans are contained in Annex 3.


 


3.             Purchase Procedures.


 


3.1           Initial Conditions Precedent. 
MBF shall not be obligated to purchase any Mortgage Loan under this
Agreement until MBF shall have first received the following 


 


13

















 


documents, each of which shall be in form and substance satisfactory to
MBF, except to the extent waived by MBF in its sole discretion:


 


(a)           this Agreement and the Seller’s Power of
Attorney, each duly executed by Seller, and the Guaranty, duly executed by
Guarantor, each dated as of the date hereof;


 


(b)           one or more certificates of Seller’s
corporate secretary attesting to certain factual matters, certifying the text
of Seller’s articles or certificate of incorporation and bylaws or other
governing charter documents, certifying the text of the resolution(s) of
the board of directors or managers of Seller authorizing the execution,
delivery and performance of this Agreement, and certifying the incumbency and
the signatures of those officers of Seller authorized to execute and deliver,
on behalf of Seller, this Agreement, each Mortgage Note endorsement, each
Assignment in Blank, and all other instruments or documents to be executed and
delivered pursuant hereto (MBF being entitled to rely thereon until a new
certificate has been furnished to MBF upon which MBF shall thereafter be
entitled to rely);


 


(c)           one or more certificates of Guarantor’s
corporate secretary attesting to certain factual matters, certifying the text
of Guarantor’s articles or certificate of incorporation and bylaws, certifying
the text of the resolution(s) of the board of directors of Guarantor
authorizing the execution, delivery and performance of this Agreement and the
Guaranty, and certifying the incumbency and the signatures of those officers of
Guarantor authorized to execute and deliver, on behalf of Guarantor, this
Agreement, the Guaranty and all other instruments or documents to be executed
and delivered by Guarantor pursuant hereto (MBF being entitled to rely thereon
until a new certificate has been furnished to MBF upon which MBF shall
thereafter be entitled to rely);


 


(d)           financial statements of Seller (and, if
applicable, its Subsidiaries, on a consolidated basis) containing a balance
sheet as of the most recent fiscal year-end of Seller (the “Statement Date”)
and related statements of income, changes in stockholders’ equity and cash
flows for the period ended on the Statement Date, and a balance sheet as of the
Interim Date and related statement of income for the period ended on the
Interim Date, all prepared in accordance with GAAP applied on a basis
consistent with prior periods and, in the case of the statements as of the
Statement Date, audited by independent certified public accountants of
recognized standing acceptable to MBF; and


 


(e)           such other financial statements, public
record search reports, legal opinions and other documents and statements as MBF
may require under the circumstances.


 


3.2           Conditions Precedent. 
MBF’s obligation to purchase any Mortgage Loan shall be subject to
satisfaction (or waiver by MBF in its sole discretion) of the following
conditions precedent:


 


(a)           the Loan Purchase Detail, the Loan Sale
Confirmation, and the documents in the Dry Funding Documents Package or the Wet
Funding Documents Package for the Mortgage Loan have been received by MBF and
are in form and substance satisfactory to MBF;


 


14

















 


(b)           no Default or Event of Default has
occurred and is continuing;


 


(c)           all of Seller’s representations and
warranties are (and will be on the proposed Acquisition Date) accurate in all
respects;


 


(d)           purchase of the Mortgage Loan shall not
cause Seller to exceed Seller’s Concentration Limit, the Wet Funding Sublimit
or any other Sublimit or Sub-sublimit with respect to such type of Mortgage
Loan established by an Annex to this Agreement applicable to such Mortgage
Loan;


 


(e)           this Agreement, the applicable Takeout
Commitment, the Seller’s Power of Attorney, and the Guaranty have not been
terminated or revoked, and each remains in full force and effect; and


 


(f)            If any Mortgage Loan to be purchased by
MBF is a MERS Designated Mortgage Loan, then (i) MBF shall have received
in form and substance satisfactory to MBF the Electronic Tracking Agreement
duly executed by Seller, MERS and the Electronic Agent, (ii) Seller shall
be a member of MERS in good standing, and (iii) the Takeout Investor shall
be a member of MERS in good standing.


 


3.3           Deliverables. 
Seller will give MBF not less than one (1) Business Day prior
notice that it intends to offer a particular Mortgage Loan for sale to MBF
hereunder.  Seller shall transmit (either
electronically or via facsimile transmission) or deliver to MBF a Loan Purchase
Detail and a Loan Sale Confirmation for the Mortgage Loan, and it shall deliver
or cause to be delivered to MBF either the Dry Funding Documents Package or the
Wet Funding Documents Package for the Mortgage Loan.  At its request for its convenience, Seller is
authorized to deliver to MBF each Loan Sale Confirmation electronically without
an original signature thereon, and each Loan Sale Confirmation so delivered is
incorporated herein by this reference and fully effective and binding on Seller
even though without such a signature when it is released to MBF at closing
pursuant to Section 3.5 or Section 3.6, as applicable.


 


3.4           Assignment of Takeout Commitment. 
The sale of each Mortgage Loan to MBF shall include Seller’s rights
under the applicable Takeout Commitment to deliver the Mortgage Loan to the
Takeout Investor and to receive the net sum therefor specified in the Takeout
Commitment from the Takeout Investor. 
Effective on and after the Acquisition Date for each Mortgage Loan
purchased by MBF hereunder, Seller assigns to MBF, free and clear of any
security interest, lien, claim or encumbrance of any kind, all of Seller’s
right, title and interest in any applicable Takeout Commitment for such
Mortgage Loan.


 


3.5           Dry Funding Closing. 
The provisions of this Section 3.5 shall apply only to the purchase
of Mortgage Loans with respect to which Section 3.6 does not apply.  Not later than one (1) Business Day
after receipt of the Loan Purchase Detail, the Loan Sale Confirmation and a Dry
Funding Documents Package, and subject to satisfaction or waiver of the
conditions precedent stated in Sections 3.1 and 3.2, MBF shall complete
the purchase of the Mortgage Loan by payment of the Acquisition Price for the
Mortgage Loan, by transfer of immediately available funds into Seller’s Funding
Account or as provided in Section 4, as applicable.  Simultaneously with payment by MBF of the
Acquisition Price, Seller shall convey to MBF absolutely, and not 


 


15

















 


by way of collateral assignment, all rights, title and interest in and
to the Mortgage Loan, free and clear of any lien, claim or encumbrance (such
conveyance in the case of MERS Designated Mortgage Loans shall be made in
accordance with the requirements of the MERS® System), subject to Seller’s
retention of servicing rights with respect to the Mortgage Loan and subject
also to the right of Seller to repurchase the Mortgage Loan as herein
provided.  The Loan Sale Confirmation and
the documents in the Dry Funding Documents Package previously delivered by
Seller are unconditionally released to MBF upon payment of the Acquisition
Price.  MBF may elect, in its sole
discretion, not to complete and record an Assignment in Blank for the sole
purpose of facilitating the servicing of the related Mortgage Loan.  In such event, Seller agrees until further
notice to remain the last named payee or endorsee of such Mortgage Note and the
mortgagee or assignee of record of such Mortgage in trust for the sole and
exclusive benefit of MBF.


 


3.6           Wet Funding Closing.  The provisions of this Section 3.6 shall
apply only to the purchase of Mortgage Loans with respect to which “Wet Funding”
is indicated as the purchase method in the applicable Loan Purchase
Detail.  Not later than one (1) Business
Day after receipt of the Loan Purchase Detail, the Loan Sale Confirmation and a
Wet Funding Documents Package, and subject to satisfaction or waiver of the
conditions precedent stated in Sections 3.1 and 3.2, MBF shall
complete the purchase of the Mortgage Loan by payment of the Acquisition Price
for the Mortgage Loan, by transfer of immediately available funds into Seller’s
loan closing escrow and the closing of that escrow in accordance with escrow
instructions.  Simultaneously with
release of the Acquisition Price proceeds in such escrow, Seller shall convey
to MBF absolutely, and not by way of collateral assignment, all rights, title
and interest in and to the Mortgage Loan free and clear of any lien, claim or
encumbrance (such conveyance in the case of MERS Designated Mortgage Loans
shall be made in accordance with the requirements of the MERS® System), subject
to Seller’s retention of servicing rights with respect to the Mortgage Loan and
subject also to the right of Seller to repurchase the Mortgage Loan as herein
provided.  The Loan Sale Confirmation and
the documents in the Wet Funding Documents Package previously delivered by
Seller are unconditionally released to MBF upon close of the escrow.  Seller shall deliver a Dry Funding Documents
Package for the Mortgage Loan not later than the Wet Funding Deadline.  MBF may elect, in its sole discretion, not to
complete and record an Assignment in Blank for the sole purpose of facilitating
the servicing of the related Mortgage Loan. 
In such event, Seller agrees until further notice to remain the last
named payee or endorsee of such Mortgage Note and the mortgagee or assignee of
record of such Mortgage in trust for the sole and exclusive benefit of MBF.


 


3.7           Post-Closing. 
If, at any time after payment of the Acquisition Price, Seller holds or
receives any documents or funds relating to a purchased Mortgage Loan, Seller
agrees to immediately notify MBF and to segregate and hold such documents
and/or funds in trust for MBF and to deliver such documents or funds at the
time and as required by other provisions of this Agreement or as directed by
MBF.  The parties acknowledge that, so
long as Seller is servicing the Mortgage Loan pursuant to Section 5,
Seller may be required to retain possession of such documents or funds solely
in its capacity as Mortgage Loan servicer.


 


4.             Warehouse Lender Arrangements. 
If a Mortgage Loan to be sold and purchased hereunder has been
previously assigned or pledged by Seller to a Warehouse Lender in connection
with any interim financing thereof, then, as applicable (i) if MBF is the
Warehouse 


 


16

















 


Lender, the amount owing to the Warehouse Lender on the Acquisition
Date shall be satisfied by internal application of sale proceeds, in which
event MBF will transfer into Seller’s Funding Account only the balance, if any,
of the Acquisition Price after such application; or (ii) if the Warehouse
Lender is a third party, MBF will transfer the full amount of the Acquisition
Price in Seller’s Funding Account but will promptly wire transfer from that
account the amount due to the third party Warehouse Lender in accordance with
the Warehouse Lender’s Wire Instructions. 
If any balance of the Acquisition Price remains in Seller’s Funding
account after the Warehouse Lender has been repaid in full in accordance with
the foregoing, that balance shall be transferred by MBF in immediately
available funds, from Seller’s Funding Account to Seller’s Operating Account.


 


5.             Servicing of Mortgage Loans and Related
Provisions.


 


5.1           Servicing of Mortgage Loans.


 


(a)           As a condition of purchasing a Mortgage
Loan, MBF requires Seller to service such Mortgage Loan as agent for MBF for
the entire period between the Acquisition Date and the Repurchase Date or the
Takeout Funding Date of the Mortgage Loan on the following terms and
conditions:


 


(i)            Seller shall service and administer the
Mortgage Loan on behalf of MBF in accordance with prudent mortgage loan
servicing standards and procedures generally accepted in the mortgage banking
industry and in accordance with all applicable requirements of the Agencies,
Requirements of Law and the requirements of any applicable Takeout Commitment
and the Takeout Investor, so that the eligibility of the Mortgage Loan for
purchase under such Takeout Commitment is not voided or reduced by such
servicing and administration;


 


(ii)           Subject to subsection 5.1(d), Seller
shall at all times maintain and safeguard the Credit File for the Mortgage Loan
(including photocopies of the documents delivered to MBF pursuant to Section 3.3),
and accurate and complete records of its servicing of the Mortgage Loan; Seller’s
possession of such Credit File being for the sole purpose of servicing such
Mortgage Loan and such retention and possession by Seller being in a custodial
capacity only;


 


(iii)          MBF
may, at any time during Seller’s business hours on reasonable notice, examine
and make copies of such documents and records;


 


(iv)          At MBF’s request, Seller shall promptly
deliver to MBF reports regarding the status of any Mortgage Loan being serviced
by Seller, which reports shall include, but shall not be limited to, a
description of any default thereunder for more than thirty (30) days or such
other circumstances that could cause a material adverse effect on such Mortgage
Loan, MBF’s title to such Mortgage Loan or the collateral securing such
Mortgage Loan; Seller may be required to deliver such reports until the
repurchase or the Takeout Funding Date of the Mortgage Loan by Seller; and


 


(v)           Seller shall immediately notify MBF if it
becomes aware of any payment default that occurs under the Mortgage Loan.


 


17














 


(b)           Seller shall not attempt to sell or
transfer any rights to service a Mortgage Loan without the prior consent of
MBF.


 


(c)           Seller shall release its custody of the
contents of any Credit File only in accordance with the written instructions of
MBF, except when such release is required as incidental to Seller’s servicing
of the Mortgage Loan, is required to complete the Takeout Funding or comply
with the Takeout Guidelines, or as required by Requirements of Law.


 


(d)           MBF reserves the right to appoint a successor
servicer to service any Mortgage Loan (each a “Successor Servicer”) upon the
occurrence of an Event of Default or if MBF reasonably believes Seller has
failed to service the Mortgage Loans consistent with the usual and customary
practices of experienced mortgage loan servicers.  In the event of such an appointment, Seller
shall perform all acts and take all action so that any part of the Credit File
and related servicing records held by Seller, together with all funds in the
Custodial Account and other receipts relating to such Mortgage Loan, are
promptly delivered to Successor Servicer. 
Seller shall have no claim for lost servicing income, lost profits or
other damages if MBF appoints a Successor Servicer hereunder and the Servicing
Fee is reduced or eliminated.


 


5.2           Custodial Account.


 


(a)           Seller shall establish and maintain a
segregated time or demand deposit account for the benefit of MBF (the “Custodial
Account”) with an Eligible Bank and shall promptly deposit into the Custodial
Account all interest and/or principal payments received with respect to each
Mortgage Loan sold hereunder (but not any interest accrued on such Mortgage
Loan up to but not including the Acquisition Date for such Mortgage Loan), and
all other receipts in respect of each Mortgage Loan sold hereunder that are
payable for the benefit of the owner of such loan (including, without
limitation, all escrow withholds and escrow payments for Property
Charges).  Seller may use a deposit
account at an Eligible Bank established to serve as a custodial account for
mortgage loans that Seller services for other parties, but under no
circumstances shall Seller deposit any of its own funds into the Custodial
Account or otherwise commingle its own funds with funds belonging to MBF as
owner of any Mortgage Loans.  In the
event Seller establishes a deposit account solely for use in connection with
collections on the Mortgage Loans, Seller shall name the account “[Name of
Seller] as agent for Washington Mutual Bank, a federal association.”


 


(b)           Any interest and/or principal payments,
and other amounts received with respect to a Mortgage Loan purchased hereunder
(but not any interest accrued on such Mortgage Loan up to but not including the
Acquisition Date for such Mortgage Loan), whether or not deposited in the
Custodial Account, shall be held in trust for the exclusive benefit of MBF as
the owner of such Mortgage Loan and shall be released only as follows:


 


(i)            after the Repurchase Price for such
Mortgage Loan has been paid in full to MBF, all amounts previously deposited in
the Custodial Account with respect to such Mortgage Loan and then in the
Custodial Account shall be:  released by
MBF to Seller in full or partial payment of the Servicing Fee or in the exercise
of Seller’s right of set-off in subsection 5.2(d); transferred to the
Takeout Investor or its designee if authorized by Seller; or remitted to MBF;


 


18

















 


(ii)           if a Successor Servicer is appointed by
MBF, all amounts deposited in the Custodial Account with respect to Mortgage
Loans to be so serviced shall be transferred into an account established by the
Successor Servicer pursuant to its agreement with MBF;


 


(iii)          upon
the occurrence of an Event of Default hereunder, Seller shall remit all funds
then held in the Custodial Account with respect to Mortgage Loans to or at the
direction of MBF; and


 


(iv)          funds shall be remitted to MBF as
provided in subsection 5.2(c).


 


(c)           On each Remittance Date, subject to
subsection 5.2(d), Seller shall remit to MBF a portion of the funds held in the
Custodial Account with respect to a Mortgage Loan for which the Repurchase Date
has not yet occurred (other than principal payments on the Mortgage Note and
escrow payments for Property Charges) equal to the sum determined by the daily
application of the Investment Return Rate to the Acquisition Price for such
Mortgage Loan on a 360-day per year basis for the actual number of days in the
period since the Acquisition Date or the immediately preceding Remittance Date
(whichever is later).  Such remittances
shall be by wire transfer in accordance with wire transfer instructions
previously given to Seller.


 


(d)           In lieu of the monthly wire transfer
remittances of funds in the Custodial Account described in subsection 5.2(c),
Seller authorizes MBF to withdraw the remittance amount each month from Seller’s
Operating Account.  MBF shall notify
Seller of each such withdrawal, and Seller shall have the right to set-off such
withdrawn amount(s) against funds in the Custodial Account to be released
to or for the benefit of MBF pursuant to subsection 5.2(b)(i).  Seller may release funds in the Custodial
Account to itself in an amount equal to such withdrawal amount(s), in the
exercise of such set-off right, at the time all funds in the Custodial Account
are distributed pursuant to subsection 5.2(b)(i).  In the event funds in the Custodial Account
are insufficient to fully reimburse Seller for such withdrawn amount(s) upon
the exercise of this set-off right, MBF shall pay Seller the deficit.


 


(e)           Seller shall not change the identity or
location of the Custodial Account without thirty (30) days prior notice to
MBF.  Seller shall from time to time, at
its own cost and expense, execute such directions to the depository Eligible
Bank, and other papers, documents or instruments as may be reasonably requested
by MBF to reflect MBF’s partial or complete ownership interest in the Custodial
Account.


 


(f)            If MBF so requests, Seller shall promptly
notify MBF of each deposit in the Custodial Account, and each withdrawal from
the Custodial Account, made by it with respect to Mortgage Loans owned by MBF
and serviced by Seller.  Seller shall
also promptly deliver to MBF photocopies of all periodic bank statements and
other records relating to the Custodial Account as MBF may from time to time
request.


 


(g)           The amount of any remittance or transfer
of funds by Seller pursuant to this Section 5, any Administrative Costs or
Successor Servicer Costs payable pursuant to Section 6.2, and any
repurchase price or other sum payable by Seller pursuant to 


 


19

















 


Section 8, not made when due shall bear interest from the due date
until the remittance, transfer or payment is made, payable by Seller, at the
lesser of the Default Rate or the maximum rate of interest permitted by
law.  If there is no maximum rate of
interest specified by applicable law, interest on such sums shall accrue at the
Default Rate.


 


6.             Seller’s Continuing Duties.


 


6.1           Takeout Commitments. 
Except to the extent superseded by this Agreement, Seller shall continue
to perform all of its duties and obligations to the Takeout Investor, under any
applicable Takeout Commitment and otherwise, with respect to a purchased
Mortgage Loan as if such Mortgage Loan were still owned by Seller and to be
sold directly by Seller to the Takeout Investor pursuant to such Takeout
Commitment on the Takeout Funding Date without the intervening ownership of MBF
pursuant to this Agreement.  Without
limiting the generality of the foregoing, Seller shall timely assemble all
records and documents concerning the Mortgage Loan required under any
applicable Takeout Commitment (except that photocopies instead of originals
shall be used for those documents already provided to MBF in the Dry Funding
Documents Package or any Wet Funding Documents Package) and all other documents
and information that may have been required or requested by the Takeout
Investor, and Seller shall make all representations and warranties required to
be made to the Takeout Investor.


 


6.2           Administrative and Successor Servicer
Costs.  Not later than each Remittance Date, Seller
shall pay to MBF all then-unpaid Administrative Costs incurred by it and
invoiced by MBF.  Not later than the
Remittance Date, Seller shall pay to MBF all Successor Servicer Costs incurred
by MBF and invoiced to Seller by MBF for which reimbursement has not yet been
made.


 


7.             Repurchase Procedures.


 


7.1           Note Shipment. 
If Seller desires that MBF send a Mortgage Note to a Takeout Investor, rather
than to Seller directly, in connection with Seller’s repurchase of the related
Mortgage Loan, then Seller shall prepare and send to MBF Shipping Instructions
to instruct MBF when and how to send such Mortgage Note to such Takeout
Investor.  MBF shall use its best efforts
to send each Mortgage Note on or before the date specified for shipment in the
Shipping Instructions, which date shall be on or before the Takeout Funding
Date.  If Seller instructs MBF to send a
Mortgage Note before the Repurchase Date, MBF will send the Mortgage Note under
a Bailee Letter.  If Seller does not
provide MBF with Shipping Instructions with respect to a Mortgage Loan, MBF
shall send the Mortgage Note to Seller at such time as MBF receives the
provisional payment of the Repurchase Price.


 


7.2           Takeout Funding Advice. 
Seller shall provide a photocopy of the Takeout Funding Advice with
respect to each Mortgage Loan to MBF prior to or on the day of the related
Takeout Funding.


 


7.3           Repurchase Closing.


 


(a)           On the Scheduled Repurchase Date or such
earlier date as the parties mutually agree upon (such earlier date for all
purposes shall be deemed the “Scheduled 


 


20

















 


Repurchase Date”), Seller shall (i) if such date is also the Takeout
Funding Date, take or cause to be taken all actions required to be taken in
accordance with the terms of the applicable Takeout Commitment, and (ii) complete
the repurchase of the Mortgage Loan by provisional payment the Repurchase Price
by transfer of immediately available funds into an account specified by MBF not
later than 3:00 p.m. Central Time on such date in an amount equal to an
estimate of the Repurchase Price (such estimate to be determined by MBF in its
sole discretion based upon the most recent available information with respect
to the Mortgage Loan, provided
that in no event shall the estimate of the Repurchase Price be less than the
Acquisition Price of such Mortgage Loan). 
Funds received by MBF after said time shall be deemed received on the
next Business Day.  Seller and MBF
acknowledge that the provisional payment of the Repurchase Price described
herein will not reflect the final calculation of the Repurchase Price.


 


(b)           Upon receipt of the provisional payment
of the Repurchase Price, MBF (i) shall convey to Seller or its designee
absolutely, and not by way of collateral assignment, all rights, title and
interest in and to the Mortgage Loan free and clear of any lien, claim or
encumbrance (such conveyance in the case of MERS Designated Mortgage Loans
shall be made in accordance with the requirements of the MERS® System) and (ii) if
a Successor Servicer has been appointed with respect to the Mortgage Loan,
transfer, or cause the transfer of, the servicing of such Mortgage Loan to
Seller or its designee.  Upon receipt of
payment of the estimated Repurchase Price from Seller, MBF shall deliver, or
cause to be delivered, to Seller or its designee all documents for the Mortgage
Loan previously delivered to MBF.  MBF
shall have no responsibility for the ownership or servicing of a Mortgage Loan
following the repurchase of the Mortgage Loan as set forth hereunder.


 


(c)           Seller, or a Takeout Investor acting on
behalf of Seller, may aggregate the provisional payments of the Repurchase
Prices for several Mortgage Loans in one wire transfer.  Upon receipt by MBF of such amounts, MBF will
attempt to match the funds received to the Mortgage Loans by reviewing the
settlement information that has been supplied by Seller or the Takeout Investor
in advance.  MBF will place all
unidentified funds in a non-interest bearing account and will promptly contact
Seller.


 


(d)           MBF shall pay to Seller the Servicing
Fee, accrued to the Repurchase Date, for each Mortgage Loan repurchased by
Seller under this Section 7.  Subject
to Section 7.5, within one (1) Business Day after the completion of
the repurchase of a Mortgage Loan by Seller in accordance with
subsection 7.3(a), MBF shall make a provisional payment to Seller of such
Servicing Fee by releasing to Seller any sum then on deposit in the Custodial
Account with respect to such Mortgage Loan (other than escrowed payments for
Property Charges) and, if necessary, by depositing in Seller’s Operating
Account such additional sum of money as MBF may estimate in its sole discretion
is due to Seller in order that Seller shall have received the estimated
Servicing Fee for such Mortgage Loan. 
Seller and MBF acknowledge that the provisional payment of this
Servicing Fee is without prejudice to the final calculation of the Servicing
Fee.


 


(e)           Each repurchase of a Mortgage Loan under
this Section 7 shall include a release to Seller of all escrowed payments
for Property Charges then in the Custodial Account and a reassignment to Seller
of its rights under the applicable Takeout Commitment to deliver the applicable
Mortgage Loan to the Takeout Investor and to receive the net sum therefor 


 


21

















 


specified in the Takeout Commitment from the Takeout Investor.  Effective on the Repurchase Date, MBF assigns
to Seller, free and clear of any security interest, lien, claim, or encumbrance
of any kind, all of MBF’s right, title and interest in any applicable Takeout
Commitment for the Mortgage Loan then repurchased by Seller.


 


7.4           Definitive Repurchase Price and Servicing
Fee.


 


(a)           After the close of the month in which the
Repurchase Date occurs for a Mortgage Loan, MBF shall make a final calculation
of the Repurchase Price for such Mortgage Loan due on the Repurchase Date, all
unpaid Administrative Costs and Successor Servicer Costs as of that date, and
the Servicing Fee (if any) due to Seller on such date with respect to such
Mortgage Loan.  MBF shall compare the
final calculation of the Repurchase Price to the estimated Repurchase Price
provisionally paid to MBF pursuant to subsection 7.3(a) and the final
calculation of the Servicing Fee to the estimated Servicing Fee, if any,
provisionally paid to Seller pursuant to subsection 7.3(d); and, if there
is a difference between one or both of the estimated amounts that were
provisionally paid and final calculations of such amounts actually due, MBF
shall, by netting the amounts due from one party to the other, determine the
final amount due from one party to the other (the “Settlement Amount”).  MBF’s final calculations of the Repurchase
Price, the Servicing Fee and the Settlement Amount hereunder shall be final and
binding on the parties in the absence of manifest error.


 


(b)           If MBF determines that the Settlement
Amount with respect to a Mortgage Loan is an amount due to MBF, MBF is
authorized to charge either or both of Seller’s Accounts in the amount of the
Settlement Amount in order to reconcile the final payment made to MBF with the
amount determined by MBF’s final calculations to have been the Repurchase Price
and the final payment made to Seller with the amount determined by MBF’s final
calculations to have been the Servicing Fee with respect to such Mortgage
Loan.  (In the event that Seller’s
Accounts do not contain sufficient funds to satisfy in whole any amount due to
MBF under this subsection 7.4(b), Seller shall promptly deposit funds in
Seller’s Funding Account sufficient to satisfy such amount due to MBF, and
Seller shall notify MBF of each such deposit.) 
If MBF determines that the Settlement Amount with respect to a Mortgage
Loan is an amount due to Seller, and subject to Section 7.5 and
subsection 8.3(a), MBF shall promptly pay to Seller the amount of the
deficit by deposit of funds in the amount of the Settlement Amount in Seller’s
Operating Account in order to reconcile the final payment made to MBF with the
amount determined by MBF’s final calculations to have been the Repurchase Price
and the final payment made to Seller with the amount determined by MBF’s final
calculations to have been the Servicing Fee with respect to such Mortgage Loan.


 


7.5           Use of Custodial Account Funds. 
Seller is authorized to withdraw from the Custodial Account funds held
with respect to a Mortgage Loan for which a Repurchase Date has occurred, in
whole or partial satisfaction of MBF’s payment obligation to Seller under
subsection 7.3(d) and Section 7.4, in which event MBF’s deposit
in Seller’s Operating Account pursuant to such provision may be reduced by the
amount of such authorized withdrawal funds.


 


22

















 


8.             Early Repurchase; Other Remedies.


 


8.1           Sale Not Caveat Emptor. 
The sale of a Mortgage Loan hereunder is not caveat emptor, it being understood that MBF is expressly
relying on the representations by Seller as to each Mortgage Loan provided in Section 11
and any applicable Annex, and the representations about Seller itself provided
in Section 12, any applicable Annex, and in the Electronic Tracking
Agreement, if applicable.


 


8.2           Early Repurchases.


 


(a)           If, after MBF purchases a Mortgage Loan,
MBF determines or receives notice (whether from Seller or otherwise) that a
purchased Mortgage Loan is (or has become) a Defective Mortgage Loan, MBF shall
promptly notify Seller and Seller shall repurchase such purchased Mortgage Loan
at the Repurchase Price on the date of repurchase.  In the case of a Wet Funding, if Seller fails
to deliver a Dry Funding Documents Package for the Mortgage Loan not later than
the Wet Funding Deadline, MBF may notify Seller, in which event Seller shall
repurchase such purchased Mortgage Loan at the Repurchase Price on the date of
repurchase.  If a Takeout Investor
refuses to honor its Takeout Commitment and complete the purchase of a Mortgage
Loan, for any reason, MBF may notify Seller and Seller shall repurchase such
Mortgage Loan at the Repurchase Price on the date of repurchase.


 


(b)           If Seller becomes obligated to repurchase
a Mortgage Loan pursuant to subsection (a) above, MBF shall promptly
give Seller notice of such repurchase obligation and a provisional calculation
of the Repurchase Price.  On the second
(2nd) Business Day after such notice (the “Early Repurchase Date”),
Seller shall repurchase the Mortgage Loan by making a provisional payment of
the Repurchase Price in the amount of the estimated Repurchase Price, and MBF
is authorized to charge either or both of Seller’s Accounts in such amount
unless the parties have agreed in writing to a different method of
payment.  (In the event that Seller’s
Accounts do not contain sufficient funds to satisfy in whole any amount due to
MBF under this subsection 8.2(b) or if the amounts due are not
provided by any applicable alternative method of payment agreed upon by the
parties, Seller shall promptly deposit funds in Seller’s Funding Account
sufficient to satisfy such amount due to MBF, and Seller shall notify MBF of
each such deposit.)  Upon receipt of the
provisional payment of the estimated Repurchase Price from Seller, MBF shall
deliver, or cause to be delivered, to Seller all documents for the Mortgage
Loan previously delivered to MBF and, in the case of a MERS Designated Mortgage
Loan, to take such steps as are necessary and appropriate to effect the
transfer of the Mortgage Loan on the MERS® System.  MBF shall pay to Seller the Servicing Fee for
each Mortgage Loan repurchased by Seller under this Section 8.  Subject to subsection 8.3(a), within one
(1) Business Day after the completion of the repurchase of a Mortgage Loan
by Seller in accordance with subsection 8.2(b), MBF shall make a provisional
payment to Seller of such Servicing Fee (if any), by releasing to Seller any
sum then on deposit in the Custodial Account with respect to such Mortgage Loan
and, if necessary, by depositing in Seller’s Operating Account such additional
sum of money as MBF may estimate in its sole discretion is due to Seller in
order that Seller shall have received the estimated Servicing Fee for such
Mortgage Loan.  Seller acknowledges that
the provisional payment of this Servicing Fee is without prejudice to the final
calculation of the Servicing Fee.


 


23

















 


(c)           After the close of the month in which the
early repurchase was completed, MBF shall make a final calculation of the
Repurchase Price for the repurchased Mortgage Loan due on the Early Repurchase
Date, all Administrative Costs and Successor Servicer Costs as of that date,
and the Servicing Fee (if any) due to Seller with respect to such Mortgage Loan
as of that date.  MBF shall then
calculate the Settlement Amount (if any) due from one party to the other in the
manner set forth in subsection 7.4(a), using the estimated Repurchase
Price and estimated Servicing Fee (if any) provisionally paid pursuant to
subsection 8.2(b) to make such calculation.  If MBF determines that the Settlement Amount
with respect to a Mortgage Loan is an amount due to MBF, MBF is authorized to
charge either or both of Seller’s Accounts in the amount of the Settlement
Amount in order to reconcile the final payment made to MBF with the amount
determined by MBF’s final calculations to have been the Repurchase Price and
the final payment made to Seller with the amount determined by MBF’s final
calculations to have been the Servicing Fee with respect to such Mortgage
Loan.  (In the event that Seller’s Accounts
do not contain sufficient funds to satisfy in whole any amount due to MBF under
this subsection 8.2(c), Seller shall promptly deposit funds in Seller’s
Funding Account sufficient to satisfy such amount due to MBF, and Seller shall
notify MBF of each such deposit.)  If MBF
determines that the Settlement Amount with respect to a Mortgage Loan is an
amount due to Seller, and subject to subsection 8.3(a), MBF shall promptly
pay to Seller the amount of the deficit by deposit of funds in the amount of
the Settlement Amount in Seller’s Operating Account in order to reconcile the
final payment made to MBF with the amount determined by MBF’s final
calculations to have been the Repurchase Price and the final payment made to
Seller with the amount determined by MBF’s final calculations to have been the
Servicing Fee with respect to such Mortgage Loan.  MBF and Seller acknowledge that the
provisional payment of this Servicing Fee is without prejudice to the final
calculation of the Servicing Fee.


 


(d)           Each repurchase of a Mortgage Loan under
this Section 8 shall include a release to Seller of all escrowed payments
for Property Charges then in the Custodial Account and a reassignment to Seller
of its rights under the applicable Takeout Commitment to deliver the applicable
Mortgage Loan to the Takeout Investor and to receive the net sum therefor
specified in the Takeout Commitment from the Takeout Investor.  Effective on the Repurchase Date, MBF assigns
to Seller, free and clear of any security interest, lien, claim or encumbrance
of any kind, all of MBF’s right, title and interest in any applicable Takeout
Commitment for the Mortgage Loan then repurchased by Seller.


 


8.3           Other Remedies.


 


(a)           Seller hereby grants to MBF a right of
set-off against the payment of any amounts that may be due and payable to MBF
from Seller, such right to be upon any and all monies and property of Seller
held or received by MBF or due and owing from MBF to Seller.


 


(b)           During the existence of an Event of
Default, notwithstanding any other provision of this Agreement, Seller shall
have no right to withdraw or release any funds in the Custodial Account to
itself or for its benefit, nor shall it have any right to set-off any amount
owed to it by MBF against funds held by it for MBF in the Custodial
Account.  During the existence of an
Event of Default, Seller shall promptly remit to or at the direction of MBF all



 


24

















 


funds related to the Mortgage Loans in the Custodial Account (i) on
the date of the Event of Default first occurs (as required by subsection
5.2(b)(iv)) and (ii) deposited by Seller in the Custodial Account after
such date pursuant to other provisions of this Agreement.


 


(c)           During the existence of an Event of
Default, MBF may at any time, without further notice to Seller, (i) accelerate
the Scheduled Repurchase Date for any or all the Mortgage Loans and declare the
Repurchase Price for each such Mortgage Loan immediately due and payable, (ii) immediately
sell, without demand or notice of any kind, at a public or private sale and at
such price or prices as MBF may deem satisfactory, any or all the Mortgage
Loans then owned by MBF and apply the proceeds thereof (net of any expenses of
sale) to any amounts owing by Seller hereunder, and (iii) in its sole
discretion, in lieu of selling all or a portion of such Mortgage Loans, to give
Seller credit for such Mortgage Loans in an amount equal to the fair market
value therefor on such date, determined by MBF in its sole discretion, and in
either case upon the determination and receipt of by MBF of all such amounts
owing by Seller, MBF shall transfer any remaining portion of such Mortgage
Loans and proceeds thereof to Seller; provided, however, that
Seller shall be liable to MBF for any deficiency if the net proceeds of all
such sales and other dispositions of the Mortgage Loans are insufficient to pay
all amounts owing by Seller to MBF.


 


9.             True Sales of Mortgage Loans.


 


9.1           True Sales.  FOR THE
AVOIDANCE OF DOUBT, MBF AND SELLER CONFIRM THAT THE TRANSACTIONS CONTEMPLATED
HEREIN ARE INTENDED TO BE TRUE SALES AND ABSOLUTE ASSIGNMENTS OF THE MORTGAGE
LOANS BY SELLER TO MBF (AND THEN BY MBF TO SELLER) AND NOT BORROWINGS SECURED
BY THE MORTGAGE LOANS.  MBF shall own
each Mortgage Loan acquired pursuant to Section 3 hereof and have all
right and entitlement appurtenant thereto, including, without limitation, the
right to pledge or transfer the Mortgage Loan (subject only to any continuing
obligations MBF may have to Seller hereunder), and the right to replace Seller
as the servicing agent with respect to such Mortgage Loan, all on such terms as
it deems appropriate.  Seller shall not
take any action inconsistent with MBF’s ownership of a Mortgage Loan purchased
hereunder and shall not claim any legal, beneficial or other interest in such a
Mortgage Loan other than its limited right and obligation, under Section 5
hereof, to provide servicing for such Mortgage Loan.  For the avoidance of doubt, MBF may, in its
sole discretion, assign all of its right, title and interest in, or grant a
security interest in, any Mortgage Loan purchased hereunder.  No notice of such assignment need be given by
MBF to Seller.  Assignment by MBF of a Mortgage
Loan as provided in this Section 9.1 shall not release MBF from its obligations
under this Agreement.


 


9.2           Precautionary Security Interest. 
Without prejudice to the provisions of Section 9.1 and the
expressed intent of the parties, in the event that, for any reason, any
transaction hereunder concerning a Mortgage Loan is construed by any Regulatory
Authority as a borrowing or financing, rather than a true sale and absolute
conveyance of the Mortgage Loan, Seller and MBF intend and agree that MBF shall
have a perfected first priority security interest in such Mortgage Loan purchased
hereunder.  In such case, Seller shall be
deemed to have hereby granted to MBF (and possession of any promissory notes,
instruments or documents by Seller or any Successor Servicer as servicer shall
constitute possession on behalf of MBF for this 


 


25

















 


purpose) a security interest in and lien upon the Mortgage Loan, the
Mortgage Note, any applicable Takeout Commitment, all servicing rights and
other rights and privileges appurtenant thereto, the Custodial Account, and all
proceeds of any and all of the foregoing. 
Seller shall also be deemed to have granted to MBF a security interest
in and lien upon all Hedging Arrangements applicable to such Mortgage Loan, all
accounts in which those Hedging Arrangements are held, all rights to payments
arising under such Hedging Arrangements, and all proceeds of any of the
foregoing, except that this security interest shall apply only to rights and
benefits, including rights to payments, related to that Mortgage Loan.  In such an event, Seller agrees that such
security interest shall be of first priority and shall be free and clear of
adverse claims, liens and interests.  In
such event, this Agreement shall constitute a security agreement, and MBF shall
have all of the rights of a secured party under applicable law.  Without prejudice to the provisions of Section 9.1
and the expressed intent of the parties, and merely as a precaution in the
event that any transaction hereunder may be so construed, Seller authorizes MBF
to file a financing statement for the above-described collateral and, at MBF’s
request, Seller and MBF will enter into a precautionary control agreement with
the depository Eligible Bank with respect to the Custodial Account and any
account in which a Hedging Arrangement is held.


 


10.           Seller Representations. 
All the representations and warranties made by Seller to MBF in this
Agreement are binding on Seller regardless whether the subject matter thereof
was under the control of Seller or a third party.  Seller acknowledges that MBF will rely upon
all such representations and warranties with respect to each Mortgage Loan
purchased by MBF hereunder, and Seller makes such representations and
warranties in order to induce MBF to purchase the Mortgage Loans.  The representations and warranties by Seller
in this Agreement with respect to a Mortgage Loan shall be unaffected by, and
shall supersede, any provision in any endorsement of any Mortgage Loan or in
any assignment with respect to such Mortgage Loan to the effect that such
endorsement or assignment is without recourse or without representation or
warranty.  All Seller representations and
warranties shall survive delivery of the Dry Funding Documents Packages, the
Wet Funding Documents Packages, and the Loan Sale Confirmations, purchase by
MBF of Mortgage Loans, delivery of the Credit Files, transfer of the servicing
for the Mortgage Loans to a Successor Servicer, the Takeout Fundings (if any),
repurchases of the Mortgage Loans by Seller (if any), and termination of this
Agreement. The representations and warranties of Seller in this Agreement shall
inure to the benefit of MBF and its successors and assigns, notwithstanding any
examination by MBF of any Mortgage Loan documents or related files.


 


11.           Representations and Warranties Concerning
Mortgage Loans.  By each delivery of a Loan Sale Confirmation,
Seller shall be deemed to make, as of the effective date of the described sale
of the Mortgage Loan or Loans (or, if another date is expressly provided in
such representation or warranty, as of such other date), each of the
representations and warranties set forth in Annex 2 concerning each
Mortgage Loan then sold to MBF (as such representations and warranties may be
modified by another Annex) and each representation and warranty concerning the
Mortgage Loan set forth in another applicable Annex.


 


12.           Representations and Warranties Concerning
Seller.  As a material inducement to enter into this
Agreement and the transactions contemplated hereby, Seller represents and warrants
as of the Effective Date and as of each Acquisition Date as follows:


 


26

















 


12.1         Organization and Good Standing. 
Seller and each of its Subsidiaries is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction under
which it was organized, has full legal power and authority to own its property
and to carry on its business as currently conducted, and is duly qualified as a
foreign corporation to do business and is in good standing in each jurisdiction
in which the transaction of its business makes such qualification necessary,
except in jurisdictions, if any, where a failure to be in good standing has no
material adverse effect on the business, operations, assets or financial
condition of Seller or any such Subsidiary. 
For the purposes hereof, good standing shall include qualification for
any and all licenses and payment of any and all taxes required in the
jurisdiction of its incorporation and in each jurisdiction in which Seller
transacts business.  Seller has no
Subsidiaries except those identified by Seller to MBF in writing.  With respect to each such Subsidiary, Seller
has accurately described to MBF its name, address, place of incorporation, each
state in which it is qualified as a foreign corporation, and the percentage
ownership of Seller in such Subsidiary.


 


12.2         Authority and Capacity. 
Seller has all requisite power, authority and capacity to enter into
this Agreement and to perform the obligations required of it thereunder.  This Agreement constitutes a valid and
legally binding agreement of Seller enforceable in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization, conservatorship and similar laws, and by equitable
principles.  No consent, approval,
authorization or order of or registration or filing with, or notice to, any
Regulatory Authority is required under state or federal law prior to the
execution, delivery and performance of or compliance by Seller with this
Agreement or the consummation by Seller of any transaction contemplated
thereby.  If Seller is a depository
institution, this Agreement shall be maintained in Seller’s official records.


 


12.3         No Conflict. 
Neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated by this Agreement, nor compliance
with its terms and conditions, shall conflict with or result in the breach of,
or constitute a default under, or result in the creation or imposition of any
lien, charge or encumbrance of any nature upon the properties or assets of
Seller, any of the terms, conditions or provisions of Seller’s charter or
by-laws or any similar corporate documents of Seller, or any mortgage,
indenture, deed of trust, loan or credit agreement or other agreement or
instrument to which Seller is now a party or by which it is bound (other than
this Agreement).


 


12.4         Performance. 
Seller 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.


 


12.5         Ordinary Course Transaction. 
The consummation of the transactions contemplated by this Agreement are
in the ordinary course of business of Seller, and the sale, transfer, assignment
and conveyance of Mortgage Loans by Seller pursuant to this Agreement are not
subject to the bulk transfer or any similar statutory provisions in effect in
any applicable jurisdiction.


 


12.6         Litigation; Compliance with Laws. 
There is no Litigation pending or, to Seller’s knowledge threatened,
that might cause a Material Adverse Change or that might materially and
adversely affect the Mortgage Loans to be sold pursuant to this Agreement.  Seller 


 


27

















 


has not violated any Requirement of Law applicable to Seller that
would, if violated, materially and adversely affect the Mortgage Loans to be
sold pursuant to this Agreement or that might cause a Material Adverse Change.


 


12.7         Statements Made. 
No representation, warranty or written statement made by Seller in this
Agreement or in any schedule, written statement or certificate furnished to MBF
by Seller in connection with this Agreement or the transactions contemplated
thereunder contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact necessary to make the statements
contained herein or therein not misleading.


 


12.8         Approved Company. 
Seller currently holds all approvals, authorizations and other licenses
from the Takeout Investors and the Agencies required under the Takeout
Guidelines (or otherwise) to originate Mortgage Loans of the types to be
offered for sale to MBF hereunder.


 


12.9         Fidelity Bonds. 
Seller has purchased fidelity bonds and policies of insurance, all of
which are in full force and effect, insuring Seller, MBF and the successors and
assigns of MBF in the greater of (a) $300,000, (b) that amount
required by the Takeout Investor, and (c) that amount required by any
other Takeout Guidelines, against loss or damage from any breach of fidelity by
Seller or any officer, director, employee or agent of Seller, and against any
loss or damage from loss or destruction of documents, fraud, theft,
misappropriation, or errors or omissions.


 


12.10       Solvency. 
Seller is solvent.  Seller will be
solvent at all relevant times prior to, will not be rendered insolvent by, will
have a valid business reason for and not have any intent to hinder, delay or
defraud any of Seller’s creditors in connection with, any sale of a Mortgage
Loan pursuant to this Agreement.


 


12.11       Reporting. 
In its financial statements Seller intends to report each sale of a
Mortgage Loan hereunder as a financing in accordance with GAAP.  Seller has been advised by or confirmed with
its independent public accountants that such sales can be so reported under
GAAP on its financial statements.


 


12.12       Financial
Condition.  The balance sheets of Seller provided to MBF
pursuant to subsection 3.1(c) hereof (and, if applicable, its
Subsidiaries, on a consolidated basis) as at the Statement Date and the Interim
Date, and the related statements of income, changes in stockholders’ equity,
and cash flows for the periods ended on the Statement Date and the Interim Date
heretofore furnished to MBF, fairly present the financial condition of Seller
and its Subsidiaries as at the Statement Date and the Interim Date and the
results of its and their operations for the periods ended on the Statement Date
and the Interim Date.  On the Statement
Date and on the Interim Date, Seller had no known material liabilities, direct
or indirect, fixed or contingent, matured or unmatured, or liabilities for
taxes, long-term leases or unusual forward or long-term commitments not
disclosed by, or reserved against on, said balance sheets and related
statements, and at the present time there are no material unrealized or
anticipated losses from any loans, advances or other commitments of Seller
except as heretofore disclosed to MBF in writing.  Said financial statements were prepared in
accordance with GAAP applied on a consistent basis throughout the periods
involved.  Since the Statement Date,
there has been no 


 


28

















 


Material Adverse Change, nor is Seller aware of any state of facts particular
to Seller which (with or without notice or lapse of time or both) would or
could result in any such Material Adverse Change.


 


12.13       Regulation
U.  Seller is not engaged principally, or as one
of its important activities, in the business of extending credit for the
purpose of purchasing or carrying Margin Stock, and no part of the proceeds of
any sales made hereunder will be used to purchase or carry any Margin Stock or
to extend credit to others for the purpose of purchasing or carrying any Margin
Stock.


 


12.14       Investment
Company Act.  Neither Seller nor any of its Subsidiaries is
an “investment company” or controlled by an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.


 


12.15       Agreements. 
Neither Seller nor any of its Subsidiaries is a party to any agreement,
instrument or indenture, or subject to any restriction, materially or adversely
affecting its business, operations, assets or financial condition, except as
disclosed in the financial statements described in subsection 3.1(c) hereof.  Seller and each Subsidiary are not in default
in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any agreement, instrument, or indenture
which default would or could result in a Material Adverse Change.  No holder of any Indebtedness of Seller or of
any of its Subsidiaries has given notice of any alleged default thereunder, or,
if given, the same has been cured or will be cured by Seller within the cure
period provided therein.  No liquidation
or dissolution of Seller or any of its Subsidiaries and no receivership,
insolvency, bankruptcy, reorganization or other similar proceedings relative to
Seller or any of its Subsidiaries or any of their respective properties is
pending or, to the knowledge of Seller, threatened.


 


12.16       Title
to Properties.  Seller and each Subsidiary of Seller has
good, valid, insurable (in the case of real property) and marketable title to
all of its properties and assets (whether real or personal, tangible or
intangible) reflected on the financial statements described in
subsection 3.1(c) hereof, and all such properties and assets are free
and clear of all Liens except as disclosed in such financial statements and not
prohibited under this Agreement.


 


12.17       ERISA. 
All plans (“Plans”) of a type described in Section 3(3) of
ERISA in respect of which Seller or any Subsidiary of Seller is an “employer,”
as defined in Section 3(5) of ERISA, are in substantial compliance
with ERISA, and none of such Plans is insolvent or in reorganization, has an
accumulated or waived funding deficiency within the meaning of Section 412
of the Internal Revenue Code, and neither Seller nor any Subsidiary of Seller
has incurred any material liability (including any material contingent
liability) to or on account of any such Plan pursuant to Sections 4062,
4063, 4064, 4201 or 4204 of ERISA; and no proceedings have been instituted to
terminate any such Plan, and no condition exists which presents a material risk
to Seller or a Subsidiary of Seller of incurring a liability to or on account
of any such Plan pursuant to any of the foregoing Sections of ERISA.  No Plan or trust forming a part thereof has
been terminated since December 1, 1974.


 


12.18       Proper
Names.  Seller does not operate in any jurisdiction
under a trade name, division, division name or name other than those names
previously disclosed in writing by 


 


29

















 


Seller to MBF, and all such names are utilized by Seller only in the
jurisdiction(s) identified in such writing.


 


12.19       No
Undisclosed Liabilities.  Other than as disclosed in the
financial statements delivered pursuant to subsection 3.1(c) and Section 13.7
hereof, Seller does not have any liabilities or Indebtedness, direct or
contingent, except for liabilities or Indebtedness which, in the aggregate, do
not exceed the amount specified in Annex 1.


 


12.20       Tax
Returns and Payments.  All federal, state and local income, excise,
property and other tax returns required to be filed with respect to Seller’s
operations and those of its Subsidiaries in any jurisdiction have been filed on
or before the due date thereof (plus any applicable extensions); all such
returns are true and correct; all taxes, assessments, fees and other
governmental charges upon Seller, and Seller’s Subsidiaries and upon its
property, income or franchises, which are due and payable have been paid,
including, without limitation, all FICA payments and withholding taxes, if
appropriate, other than those which are being contested in good faith by
appropriate proceedings, diligently pursued and as to which Seller has
established adequate reserves determined in accordance with GAAP, consistently
applied.  The amounts reserved, as a
liability for income and other taxes payable, in the financial statements
described in subsection 3.1(c) are sufficient for payment of all
unpaid federal, state and local income, excise, property and other taxes,
whether or not disputed, of Seller and its Subsidiaries, accrued for or
applicable to the period and on the dates of such financial statements and all
years and periods prior thereto and for which Seller, and Seller’s Subsidiaries
may be liable in their own right or as transferee of the assets of, or as
successor to, any other Person.


 


12.21       Subsidiaries. 
Seller has not issued, and does not have outstanding, any warrants,
options, rights or other obligations to issue or purchase any shares of its
capital stock or other securities.  The
outstanding shares of capital stock of Seller have been duly authorized and
validly issued and are fully paid and nonassessable.


 


12.22       Holding
Company.  Seller is not a “holding company” or a “subsidiary
company” of a “holding company” within the meaning of the Public Utility
Holding Company Act of 1935, as amended.


 


12.23       Credit
Information.  Except as may be prohibited by law, Seller
has full right and authority and is not precluded by law or contract from
furnishing to MBF the applicable consumer report (as defined in the Fair Credit
Reporting Act, Public Law 91-508) and all other credit information relating to
each Mortgage Loan sold hereunder, and MBF will not be precluded from
furnishing such materials to the related Takeout Investor by such laws.


 


12.24       No
Discrimination.  Seller makes credit accessible to all
qualified applicants in accordance with all applicable laws and
regulations.  Seller has not
discriminated, and will not discriminate, against credit applicants on the
basis of any prohibited characteristic, including race, color, religion,
national origin, sex, marital or familial status, age (provided that the
applicant has the ability to enter into a binding contract), handicap, sexual
orientation or because all or part of the applicant’s income is derived from a
public assistance program or because of the applicant’s good faith exercise of
rights under the Federal Consumer Protection Act.  Furthermore, Seller has not discouraged, and
will not discourage, the completion of any 


 


30

















 


credit application based on any of the foregoing prohibited bases.  In addition, Seller has complied with all
anti-redlining provisions and equal credit opportunity laws applicable under
state and federal statute and regulation.


 


12.25       Home
Ownership and Equity Protection Act.  There is no
litigation, proceeding or governmental investigation existing or pending or to
the knowledge of Seller threatened, or any order, injunction or decree
outstanding against or relating to Seller, relating to any violation of the
Home Ownership and Equity Protection Act or any state, city or district high
cost home mortgage or predatory lending law.


 


12.26       CL
Program.  If Seller currently originates Mortgage Loans
for sale to CL under the CL Program, Seller makes each of the representations
and warranties concerning Seller set forth in Annex 3.


 


13.           Seller’s Covenants. 
Seller shall perform the following duties during the term of this
Agreement:


 


13.1         Maintenance of Existence; Conduct of
Business.  Seller shall preserve and maintain its
corporate or other existence in good standing and all of its rights,
privileges, licenses and franchises necessary in the normal conduct of its
business, including without limitation its eligibility as lender,
seller/servicer and issuer described under Section 12.8 hereof; and it
shall conduct its business in an orderly and efficient manner; and make no
material change in the nature or character of its business or engage in any
business in which it was not engaged on the date of this Agreement.  At any time that MBF owns MERS Designated
Mortgage Loans, Seller shall remain a member of MERS in good standing.


 


13.2         Compliance with Applicable Laws. 
Seller shall comply with the requirements of all applicable laws, rules,
regulations and orders of any governmental authority, a breach of which could
materially adversely affect its business, operations, assets, or financial
condition, except where contested in good faith and by appropriate proceedings,
and with sufficient reserves established therefor.


 


13.3         Inspection of Properties and Books. 
Seller shall permit authorized representatives of MBF to (a) discuss
the business, operations, assets and financial condition of Seller and Seller’s
Subsidiaries with their officers and employees and to examine their books of
account, records, reports and other papers and make copies or extracts thereof,
and (b) inspect all of Seller’s property and all related information and
reports at Seller’s expense, all at such reasonable times as MBF may
request.  Seller will provide its
accountants with a photocopy of this Agreement promptly after the execution
hereof and will instruct its accountants to answer candidly any and all
questions that the officers of MBF or any authorized representatives of MBF may
address to them in reference to the financial condition or affairs of Seller
and Seller’s Subsidiaries.  Seller may
have its representatives in attendance at any meetings between the officers or
other representatives of MBF and Seller’s accountants held in accordance with this
authorization.


 


13.4         Notices.  Seller shall
give prompt notice to MBF of (a) any action, suit or proceeding instituted
by or against Seller or any of its Subsidiaries in any federal or state court
or 


 


31

















 


before any commission or other regulatory body (federal, state or
local, domestic or foreign) which action, suit or proceeding has at issue in
excess of the amount specified in Annex 1 (except for normal collection
and foreclosure proceedings initiated by Seller in connection with a Mortgage
Loan or any other mortgage loan), or any such proceedings threatened against
Seller or any of Seller’s Subsidiaries in writing, (b) the filing,
recording or assessment of any federal, state or local tax Lien against it, or
any of its assets or any of its Subsidiaries, (c) the occurrence of any
Event of Default hereunder or the occurrence of any Default and continuation
thereof for five (5) days, (d) the suspension, revocation or
termination of any of Seller’s licenses or eligibility as described under Section 12.8
hereof, and (e) any other action, event or condition of any nature which
may result in a Material Adverse Change or which, with or without notice or
lapse of time or both, will constitute a default under any other agreement,
instrument or indenture to which Seller is a party or to which its properties
or assets may be subject.


 


13.5         Payment of Debt, Taxes, etc. 
Seller shall pay and perform all obligations and Indebtedness of Seller,
and cause to be paid and performed all obligations and Indebtedness of its
Subsidiaries in accordance with the terms thereof, and pay and discharge or
cause to be paid and discharged all taxes, assessments and governmental charges
or levies imposed upon Seller or its Subsidiaries, or upon their respective
income, receipts or properties, before the same shall become past due, as well
as all lawful claims for labor, materials or supplies or otherwise which, if
unpaid, might become a Lien or charge upon such properties or any part thereof;
provided, however, that Seller and its Subsidiaries shall not be
required to pay obligations, Indebtedness, taxes, assessments or governmental
charges or levies or claims for labor, materials or supplies for which Seller
or its Subsidiaries shall have obtained an adequate bond or adequate insurance
or which are being contested in good faith and by proper proceedings that are
being reasonably and diligently pursued, if such proceedings do not involve any
likelihood of the sale, forfeiture or loss of any such property or any interest
therein while such proceedings are pending; and provided  further
that book reserves adequate under GAAP shall have been established with respect
thereto.


 


13.6         Insurance.  Seller shall
maintain (a) errors and omissions insurance or mortgage impairment
insurance and blanket bond coverage, with such companies and in such amounts as
satisfy prevailing Agency requirements applicable to a qualified mortgage
originating institution; (b) liability insurance and fire and other hazard
insurance on its properties, with responsible insurance companies approved by
MBF, in such amounts and against such risks as is customarily carried by
similar businesses operating in the same vicinity; and (c) within thirty
(30) days after notice from MBF, obtain such additional insurance as MBF shall
reasonably require, all at the sole expense of Seller.  Photocopies of such policies shall be
furnished to MBF without charge upon obtaining such coverage or any renewal of
or modification to such coverage.


 


13.7         Financial Statements and Other Reports. 
Seller shall deliver or cause to be delivered to MBF:


 


(a)           As soon as available and in any event not
later than the Monthly Reporting Date, statements of income and changes in
stockholders’ equity and cash flow of Seller and, if applicable, Seller’s
Subsidiaries, on a consolidated basis for the immediately preceding month, and
related balance sheet as at the end of the immediately preceding month, all 


 


32

















 


in reasonable detail, prepared in accordance with GAAP applied on a
consistent basis, and certified as to the fairness of presentation by the
president and chief financial officer of Seller, subject, however, to normal
year-end audit adjustments;


 


(b)           As soon as available and in any event not
later than the Annual Reporting Date, statements of income, changes in
stockholders’ equity and cash flows of Seller, and, if applicable, Seller’s
Subsidiaries, on a consolidated basis for the preceding fiscal year, the related
balance sheet as at the end of such year (setting forth in comparative form the
corresponding figures for the preceding fiscal year), all in reasonable detail,
prepared in accordance with GAAP applied on a consistent basis throughout the
periods involved, and accompanied by an opinion in form and substance
satisfactory to MBF and prepared by an accounting firm reasonably satisfactory
to MBF, or other independent certified public accountants of recognized
standing selected by Seller and acceptable to MBF, as to said financial
statements and a certificate signed by the president and chief financial
officer of Seller stating that said financial statements fairly present the
financial condition and results of operations of Seller and, if applicable,
Seller’s Subsidiaries as at the end of, and for, such year;


 


(c)           Together with each delivery of financial
statements required in this Section, a Compliance Certificate;


 


(d)           Photocopies of all regular or periodic
financial and other reports, if any, which Seller shall file with the SEC or
any governmental agency and photocopies of any audits completed by any Agency;


 


(e)           not less frequently that once every two (2) weeks
(and more often if requested by MBF), a report in form and substance
satisfactory to MBF summarizing the Hedging Arrangements then in effect with
respect to all Mortgage Loans then owned by MBF and serviced by Seller (or a
Successor Servicer); and


 


(f)            From time to time, with reasonable
promptness, such further information regarding the business, operations,
properties or financial condition of Seller as MBF may reasonably request.


 


13.8         Limits on Corporate Distributions. 
Seller shall not pay, make or declare or incur any liability to pay,
make or declare any dividend (excluding stock dividends) or other distribution,
direct or indirect, on or on account of any shares of its stock or any
redemption or other acquisition, direct or indirect, of any shares of its stock
or of any warrants, rights or other options to purchase any shares of its
stock, nor purchase, acquire, redeem or retire any stock or ownership interest
in itself whether now or hereafter outstanding, except that, so long as no
Default or Event of Default exists at such time or will occur as a result of
such payment, Seller may pay Permitted Dividends as described in Annex 1.


 


13.9         Use of Washington Mutual’s Name. 
Seller shall confine its use of Washington Mutual’s logo and the “Washington
Mutual” name to those uses specifically authorized by Washington Mutual in
writing.  In no instance may Seller
disclose to any prospective Mortgagor, or the agents of the Mortgagor, that
such Mortgagor’s mortgage loan will be offered for sale to Washington
Mutual.  Seller may not use Washington
Mutual’s name or 


 


33

















 


logo to obtain any mortgage-related services except to identify, in
general marketing and information materials, that Seller has a funding
relationship with Washington Mutual.


 


13.10       Reporting. 
In its financial statements Seller will report each sale of a Mortgage
Loan hereunder as a financing in accordance with GAAP.


 


13.11       Debt
to Adjusted Tangible Net Worth Ratio.  Seller shall
not permit the ratio of Debt to Adjusted Tangible Net Worth of Seller (and, if
applicable, its Subsidiaries, on a consolidated basis) to exceed the ratio
specified in Annex 1 computed as of the end of each calendar month.


 


13.12       Minimum
Adjusted Tangible Net Worth.  Seller shall
not permit the Adjusted Tangible Net Worth of Seller (and, if applicable, its
Subsidiaries, on a consolidated basis), computed as of the end of each calendar
month, to be less than the amount specified in Annex 1.


 


13.13       Minimum
Current Ratio.  Seller shall not permit the Current Ratio of
Seller (and, if applicable, its Subsidiaries, on a consolidated basis),
computed as of the end of each calendar month, to be less than the ratio
specified in Annex 1.


 


13.14       Hedging
Arrangements.  Seller shall maintain Hedging Arrangements
with respect to all Mortgage Loans not the subject of Takeout Commitments reasonably
satisfactory to MBF, with Persons reasonably satisfactory to MBF, in order to
mitigate the risk that the market value of any such Mortgage Loan will change
as a result of a change in interest rates or the market for mortgage loan
assets before the Mortgage Loan is purchased by a Takeout Investor or
repurchased by Seller.  Seller will use
commercially reasonable efforts to cause a Person providing such a Hedging
Arrangement to acknowledge MBF’s precautionary security interest in the Hedging
Arrangement and related collateral granted pursuant to Section 9.2, by
agreement reasonably satisfactory to MBF.


 


14.           Term.      This
Agreement shall continue indefinitely unless and until terminated as to future
transactions (a) by notice signed by either Seller or MBF and delivered to
the other in compliance with Annex 1, in which event termination
will not affect the obligations hereunder and under the Guaranty as to any
Mortgage Loan with respect to which a Loan Purchase Detail, a Loan Sale
Confirmation, a Dry Funding Documents Package, or a Wet Funding Documents
Package has been delivered by Seller pursuant to the terms of this Agreement
prior to said notice; or (b) by notice of immediate termination from MBF
following the occurrence of, and during the continuance of, an Event of
Default; provided, however, that termination shall be immediately
effective, without the necessity of a notice from MBF, upon the occurrence of
an Act of Insolvency.  Termination will
not affect the obligations hereunder and under the Guaranty as to any Mortgage
Loans purchased prior to the effective date of such termination.


 


15.           Notices; Service.


 


15.1         Notices.  All notices,
demands, consents, requests and other communications required or permitted to
be given or made hereunder shall, except as otherwise expressly provided
hereunder, be in writing and shall be delivered in person or mailed, first
class, return receipt requested, postage prepaid, or delivered by overnight
courier, addressed to the 


 


34

















 


respective parties hereto at their respective addresses hereinafter set
forth or, as to any such party, at such other address as may be designated by
it in a notice to the other.  All such
communications shall be conclusively deemed to have been properly given or made
when duly delivered, in person or by overnight courier, or if mailed on the
third Business Day after being deposited in the mails, addressed to the
applicable address specified in Annex 1, or to such other
address(es) or telex or telecopier number(s) as the party to be served may
direct by notice to the other party in the manner hereinabove provided.


 


15.2         Intentionally deleted.


 


16.           Fees and Expenses; Indemnity.


 


16.1         Fees and Expenses. 
Seller will promptly pay all out-of-pocket costs and expenses incurred
by MBF, including without limitation reasonable attorneys’ fees, in connection
with (i) preparation, negotiation, documentation and administration of
this Agreement and the Guaranty and purchase and resale of Mortgage Loans by
MBF hereunder, (ii) protection of the Mortgage Loans purchased hereunder
(including, without limitation, all costs of filing or recording any
assignments, financing statements and other documents), and (iii) enforcement
of MBF’s rights hereunder and under the Guaranty (including, without
limitation, costs and expenses suffered or incurred by MBF in connection with
any Act of Insolvency related to Seller, appeals and any anticipated
post-judgment collection services).


 


16.2         Indemnity.  In addition
to its other rights hereunder, Seller shall indemnify MBF and MBF’s directors,
officers, agents and employees against, and hold MBF and each of them harmless
from, any losses, liabilities, damages, claims, costs and expenses (including
reasonable attorneys’ fees and disbursements) suffered or incurred by MBF or
any of them arising out of, resulting from, or in any manner connected with,
the purchase by MBF of any Defective Mortgage Loans.  The provisions of Section 16 shall
survive the termination of this Agreement.


 


17.           Confidential Information.


 


17.1         Restrictions on Use of Confidential
Information.  Seller and MBF agree not to use Confidential
Information of the other for any purpose other than the fulfillment of its
obligations under the Agreement.  Seller
and MBF shall not disclose, publish, release, transfer or otherwise make
available Confidential Information of the other in any form to, or for the use
or benefit of, any Person without the other’s consent.  Seller and MBF shall, however, be permitted
to disclose relevant aspects of the other’s Confidential Information to its
officers, agents, subcontractors, and employees to the extent that such
disclosure is reasonably necessary for the performance of its duties and
obligations under the Agreement and such disclosure is not prohibited by the
GLB Act, the regulations promulgated thereunder or other applicable law; provided,
however, that Seller and MBF shall take all reasonable measures
to ensure that Confidential Information of the other is not disclosed or
duplicated in contravention of these provisions by such officers, agents,
subcontractors and employees.  Seller and
MBF further agree promptly to advise the other in writing of any
misappropriation, or unauthorized disclosure or use by any person of
Confidential Information which may come to its attention and to take all steps
reasonably requested by the other to limit, stop or otherwise remedy such
misappropriation, 


 


35

















 


or unauthorized disclosure or use. 
If the GLB Act, the regulations promulgated hereunder or other
applicable law now or hereafter in effect imposes a higher standard of
confidentiality to the Confidential Information, such standard shall prevail
over the provisions of this Section.


 


17.2         Controls on Confidential Information. 
Seller and MBF shall establish commercially reasonable controls to
ensure that the confidentiality of the Confidential Information and to ensure
that the Confidential Information is not disclosed contrary to the provisions
of this Section, the GLB Act or any other applicable privacy laws and
regulations.  Without limiting the
foregoing, Seller and MBF shall implement such physical and other security
measures as are necessary to (i) ensure the security and confidentiality
of the Confidential Information, (ii) protect against any threats or
hazards to the security and integrity of the Confidential Information and (iii) protect
against any unauthorized access to or use of the Confidential Information.  Seller and MBF shall, at a minimum establish
and maintain such data security program as is necessary to meet the objectives
of the Interagency Guidelines Establishing Standards for Safeguarding Customer
Information as set forth in the Code of Federal Regulations at 12 C.F.R. Parts
30, 208, 211, 225, 263, 308 364, 568 and 570. 
To the extent that any duties and responsibilities under the Agreement
are delegated to an agent or other subcontractor, reasonable steps shall be
taken to ensure that such agents and subcontractor adhere to the same requirements.  Seller and MBF will not make any more copies
of the other’s written or graphic materials containing Confidential Information
than is necessary for its use under the terms of the Agreement, and each such
copy shall be marked with the same proprietary notices as appear on the
originals.


 


17.3         Audits.  Seller and
MBF shall have the right, during regular office hours and upon reasonable
notice, to audit the other party to ensure compliance with the terms of the
Agreement, GLB and other privacy laws and regulations.


 


17.4         Confidential Information Not Subject to
Restrictions.  Notwithstanding anything to the contrary
contained herein, neither Seller nor MBF shall have any obligation with respect
to any Confidential Information of the other party, or any portion thereof,
which the receiving party can establish by competent proof:


 


	
  (i)

  	
   

  	
  is or becomes generally known to companies engaged
  in the same or similar businesses as the parties hereto on a non-confidential
  basis, through no wrongful act of the receiving party;

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  is lawfully obtained by the receiving party from a
  third party which has no obligation to maintain the information as
  confidential and which provides it to the receiving party without any
  obligation to maintain the information as proprietary or confidential;

  
	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  was known prior to its disclosure to the receiving
  party without any obligation to keep it confidential as evidenced by the
  tangible records kept by the receiving party in the ordinary course of its
  business;

  
	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  is independently developed by the receiving party
  without reference to the disclosing party’s Confidential Information; or

  



 


36














 


(v)                                 is the subject of a written agreement
whereby the disclosing party consents to the use or disclosure of such
Confidential Information.


 


17.5         Required Disclosures. 
If a receiving party or any of its representatives shall be under a
legal obligation in any administrative or judicial circumstance to disclose any
Confidential Information, the receiving party shall give the disclosing party
prompt notice so that the disclosing party may seek a protective order and/or
waive the duty of nondisclosure; provided that in the absence of such order or
waiver, if the receiving party or any such representative shall, in the opinion
of its counsel, stand liable for contempt or suffer other censure or penalty
for failure to disclose, disclosure pursuant to the order of such tribunal may
be made by the receiving party or its representative without liability
hereunder.


 


17.6         Continued Restrictions. 
For as long as Seller or MBF continues to possess or control
Confidential Information furnished by the other, and for so long as the
Confidential Information remains unpublished, confidential and legally
protectable as the property of the disclosing party, except as otherwise
specified herein, the receiving party shall make no use of such Confidential
Information whatsoever, notwithstanding the termination or expiration of the
Agreement.  Seller and MBF acknowledge
their understanding that the termination or expiration of the Agreement shall
not be deemed to give either a right or license to use or disclose the
Confidential Information of the other. 
Any materials or documents, including copies that contain Confidential
Information, shall be promptly returned when necessary to prevent disclosure of
the Confidential Information to third parties.


 


17.7         Injunctive Relief Permitted. 
It is agreed that the unauthorized disclosure or use of any Confidential
Information may cause immediate or irreparable injury to the party providing
the Confidential Information, and that such party may not be adequately
compensated for such injury in monetary damages.  Seller and MBF therefore acknowledge and
agree that, in such event, the other shall be entitled to seek any temporary or
permanent injunctive relief necessary to prevent such unauthorized disclosure
or use, or threat of disclosure or use, and each consents to the jurisdiction
of any federal or state court of competent jurisdiction sitting in Seattle,
Washington for purpose of any suit hereunder and to service of process therein
by certified or registered mail, return receipt requested.


 


18.           Modifications, Consents and Waivers;
Entire Agreement.  No modification, amendment or waiver of, or
with respect to, any provision of this Agreement or any other instruments and
documents delivered pursuant hereto or thereto, nor consent to any departure by
Seller or MBF from any of the terms or conditions hereof or thereof, shall in
any event be effective unless it shall be in writing and signed by MBF and
Seller.  Any such waiver or consent shall
be effective only in the specific instance and for the purpose for which
given.  No consent to or demand on Seller
in any case shall, of itself, entitle it to any other or further notice or
demand in similar or other circumstances. 
This Agreement embodies the entire agreement and understanding between
MBF and Seller on the subject hereof and supersedes all prior agreements and
understandings relating to the subject matter hereof.


 


19.           Remedies Cumulative. 
Each and every right granted to MBF hereunder or under any other
document delivered hereunder or in connection herewith, or allowed MBF by law
or equity, shall be cumulative and may be exercised from time to time.  No course of dealing on the 


 


37

















 


part of MBF, nor any failure on MBF’s part to exercise, nor any delay
in exercising, any right shall operate as a waiver thereof or otherwise
prejudice the rights, powers and remedies of MBF.  No single or partial exercise of any right
shall preclude any other or future exercise thereof or the exercise of any
other right.  The due payment and
performance of Seller’s obligations hereunder shall be without regard to any
counterclaim, right of offset or any other claim whatsoever which Seller may
have against MBF and without regard to any other obligation of any nature whatsoever
which MBF may have to Seller, and no such counterclaim or offset shall be
asserted by Seller, in any action, suit or proceeding instituted by MBF to
enforce this Agreement.


 


20.           Counterparts. 
This Agreement may be signed in any number of counterparts with the same
effect as if the signatures thereto and hereto were upon the same instrument.


 


21.           Governing Law. 
THIS AGREEMENT IN ALL RESPECTS, INCLUDING, WITHOUT LIMITATION, ALL
MATTERS OF CONSTRUCTION, INTERPRETATION, VALIDITY, ENFORCEMENT AND PERFORMANCE
SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF TEXAS, WITHOUT REGARD TO ITS PRINCIPLES OF CONFLICTS OF
LAW.


 


22.           Severability. 
The provisions of this Agreement are severable, and if any clause or provision
hereof shall be held invalid or unenforceable in whole or in part in any
jurisdiction, then such invalidity or unenforceability shall affect only such
clause or provision, or part thereof, in such jurisdiction and shall not in any
manner affect any other clause or provision or such clause or provision in any
other jurisdiction.


 


23.           Binding Effect; Assignment or Delegation. 
This Agreement shall be binding upon and shall inure to the benefit of
Seller, MBF and their respective successors and permitted assigns.  It is expressly agreed that MBF may assign
its right to enforce this Agreement as to any Mortgage Loan to any party that
subsequently purchases such Mortgage Loan from MBF or provides financing to MBF
with respect to such Mortgage Loan.  The
rights and obligations of Seller under this Agreement shall not be assigned or
delegated without the prior written consent of MBF, which consent may be
withheld in MBF’s sole discretion, and any purported assignment or delegation
without such consent shall be void.


 


24.           Annexes, Exhibits and Riders. 
All Annexes, Exhibits and Contract Riders attached hereto are
incorporated in this Agreement by this reference.


 


25.           Time of the Essence. 
Any payment, remittance or transfer of funds due hereunder by one party
to the other (or to a designated third party) due on a day that is not a
Business Day shall be made on the next succeeding Business Day.  TIME IS OF THE ESSENCE WITH REGARD TO THE
PERFORMANCE OF SELLER’S OBLIGATIONS UNDER THIS AGREEMENT.


 


[Signature Page Follows]


 


38

















 


	
   

  	
  WASHINGTON MUTUAL BANK,  a federal

  association

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ben R. Culver

  
	
   

  	
  Name:

  	
  Ben R. Culver

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SIRVA
  MORTGAGE, INC., an Ohio corporation

  f/k/a Cooperative Mortgage Services, Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul E. Klemme

  
	
   

  	
  Name:

  	
  Paul E. Klemme

  
	
   

  	
  Title:

  	
  President

  
						



 


Applicable Annexes


 


	
  x

  	
  Annex 1

  	
  Customized Terms

  
	
  x

  	
  Annex 2

  	
  Representations and Warranties Concerning Mortgage
  Loans

  
	
  x

  	
  Annex 3

  	
  Mortgage Loans Subject to CL Commitments

  
	
  x

  	
  Annex 4

  	
  Provisions Relating to Type 1 Nonconforming Loans

  
	
  x

  	
  Annex 5

  	
  Provisions Relating to Type 2 Nonconforming Loans

  
	
  o

  	
  Annex 6

  	
  Provisions Relating to Type 3 Nonconforming Loans

  
	
  x

  	
  Annex 7

  	
  Provisions Relating to Undesignated Loans

  
	
  x

  	
  Annex 8

  	
  Provisions Relating to Aged Mortgage Loans

  



 


39

















 


Annex 1


 


Customized Terms


 


1.             Additional Definitions.  The following
definitions are added to Section 1 of the Agreement:


 


“Annual Reporting Date” means the date that is ninety (90) days
after the end of each fiscal year (see subsection 13.7(b)).


 


“Interim Date” means March 31, 2005.


 


“Maximum Takeout Commitment
Expiration Date”
means the date that is ninety (90) days after the Acquisition Date for a
particular Mortgage Loan.


 


“Monthly Reporting Date” means the date that is thirty (30) days
after the end of each calendar month (see subsection 13.7(a)).


 


“Permitted Dividend” means a regular cash dividend declared
by Seller and paid to its shareholders, provided that such dividends do not
exceed, in the aggregate, during any fiscal year fifty percent (50%) of Seller’s
net income for such fiscal year (as calculated on its annual statement of
income).


 


“Seller’s Concentration Limit” means $120,000,000.00 at any one time.


 


“Used Portion” means, at the time of any determination,
the sum of the arithmetic daily averages of the Acquisition Price of all
Mortgage Loans previously purchased by MBF but not yet either repurchased by
Seller or purchased by a Takeout Investor as of such determination.  MBF’s determination of the Used Portion is
binding and conclusive, absent manifest error.


 


“Wet Funding Deadline” means the five (5) Business Day
after the closing of the Mortgage Loan.


 


“Wet Funding Sublimit” means 30% of the Seller’s Concentration
Limit at any one time, provided however, for the first and last five calendar
days of each month, the Wet Funding Sublimit means 40% of the Seller’s
Concentration Limit at any one time.


 


2.             Modified or Clarified Definitions Terms. 
The following definitions and terms are clarified or modified, as
applicable, as follows:


 


“Acquisition Price”: 
The percentage referenced in the definition of “Acquisition Price” in Section 1
of the Agreement is ninety-eight percent (98%).


 


“Event of Default”:  The amount of
Indebtedness referenced in clause (xi) of the definition of “Event of Default”
in Section 1 of the Agreement is Fifty Thousand and No/100 Dollars
($50,000.00).


 


“Guarantor”:  Intentionally
deleted.


 


1

















 


“Investment Return Rate”: 
The number of basis points referenced in the definition of “Investment
Return Rate” in Section 1 of the Agreement is 162.5 basis points (1.625%).


 


“Scheduled Repurchase Date”:  The number of
days referenced in the definition of “Scheduled Repurchase Date” in Section 1
of the Agreement is ninety (90) days.


 


No Undisclosed Liabilities:  The amount of
liabilities and Indebtedness referenced in Section 12.19 of the Agreement
is Twenty-Five Thousand and No/100 Dollars ($25,000.00).


 


Notices of Actions, Suits or
Proceedings:  The amount at issue referenced in Section 13.4
of the Agreement is One Hundred Thousand and No/100 Dollars ($100,000.00).


 


Debt to Adjusted Tangible Net Worth
Ratio: 
The ratio referenced in Section 13.11 of the Agreement is: (a) 17:1
for the period commencing June 1, 2005 through and including September 30,
2005, and (b) 15:1 for any time thereafter.


 


Minimum Adjusted Tangible Net Worth:  The amount
referenced in Section 13.12 of the Agreement is Six Million Five Hundred
Thousand and No/100 Dollars ($6,500,000.00).


 


Minimum Current Ratio:  The ratio
referenced in Section 13.13 of the Agreement is 1.05:1.


 


3.             Deposit Credit.  Section 6
of the Agreement is amended by the addition of the following Section:


 


6.3           Deposit Credit. 
Each month MBF shall credit to Seller against the amounts otherwise
payable to MBF hereunder a credit based on the Monthly Available Deposits.  This credit shall be the sum obtained by the daily
application of the LIBOR Rate to the Monthly Available Deposit for the month,
multiplied by the number of days in such month, and the credit so calculated
shall be applied against amounts due from Seller on the next Remittance
Date.  The “Monthly Available Deposits”
means the arithmetic daily average of the collected balances (after deducting
float and balances required by MBF under its normal practices to compensate MBF
for the maintenance of such accounts and taking into consideration reserve
requirements, insurance premiums and other assessments applicable to such
accounts) in non-interest bearing accounts in the name of Seller with MBF.  MBF shall calculate the Monthly Available
Deposits and the resulting credit in its sole discretion promptly after the last
Business Day of each month.


 


4.             Additional Seller Representation: Place of Business
and Formation.  Section 12 of the Agreement is amended
by the addition of the following Section 12.27:


 


12.27       Place
of Business and Formation.  The principal place of
business of Seller is 6070 Parkland Boulevard, Mayfield Heights, Ohio
44124.  As of the Effective Date, and
during the four (4) months immediately preceding that date, the chief
executive office of Seller and the office where it keeps its financial books
and records relating to its property and all contracts relating thereto and all
accounts arising therefrom is and has been located at the address set forth for



 


2

















 


Seller in Section 6
of Annex 1.  As of the
Effective Date, Seller’s jurisdiction of organization is Ohio.


 


5.             Termination.  For the
purposes of clause (a) of Section 14 of the Agreement, notice of
termination must be delivered not less than thirty (30) days prior to the date
of termination.


 


6.             Notices.  Notices to
Seller made pursuant to Section 15.1 of the Agreement shall be addressed
as follows:


 


SIRVA Mortgage, Inc. 

6070 Parkland Boulevard

Mayfield Heights, Ohio 44124

Attention: President

Telecopy No.: (        )         -


 


Notices to MBF made pursuant to Section 15.1 of
the Agreement shall be addressed as follows:


 


Washington Mutual Bank 

Mortgage Banker Finance

620 W. Germantown Pike, Suite 200

Plymouth Meeting, PA 19462

Attention:  Joseph Meehan

Telecopy No.: (610) 828-9657


 


with a copy to:


 


Washington Mutual Bank

Legal Department

9200 Oakdale Avenue

Chatsworth, CA 91311

Attention:  Carol A. Robertson

Telecopy No.: (818) 349-2734


 


3

















 


Annex 2


 


Representations and Warranties Concerning Mortgage
Loans


 


[Loan
Characteristics]


 


1.             Valid Lien.  The Mortgage
is a valid, subsisting, enforceable and perfected first lien (if the Mortgage
Loan is indicated by Seller to be a first lien Mortgage Loan on the Loan
Purchase Detail) or second lien (if the Mortgage Loan is indicated by Seller to
be a second lien Mortgage Loan on the Loan Purchase Detail) on the Mortgaged
Property, including all buildings on the Mortgaged Property and all
installations and mechanical, electrical, plumbing, heating and air
conditioning systems located in or annexed to such buildings, and all
additions, alterations and replacements made at any time with respect to the
foregoing, and the Mortgaged Property is owned by the Mortgagor in fee simple
or is a leasehold estate, subject only to:


 


(a)                                  if the Mortgage Loan is indicated by Seller
to be a second lien Mortgage Loan on the Loan Purchase Detail, a prior mortgage
lien on the Mortgaged Property;


 


(b)                                 the lien of current real property taxes
and assessments not yet due and payable;


 


(c)                                  covenants, conditions and restrictions,
rights of way, easements and other matters of public record as of the date of
recording acceptable to mortgage lending institutions generally and
specifically referred to in the lender’s title insurance policy delivered to
the originator of the Mortgage Loan and


 


(i)            referred to or otherwise considered in
the appraisal made for the originator of the Mortgage Loan or


 


(ii)           which do not adversely affect the
appraised value of the Mortgaged Property set forth in such appraisal; and


 


(d)                                 other matters to which like properties
are commonly subject to 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 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, subsisting and enforceable first lien and
first priority security interest (if the Mortgage Loan is indicated by Seller
to be a first lien Mortgage Loan on the Loan Purchase Detail) or second lien
and second priority security interest (if the Mortgage Loan is indicated by
Seller to be a second lien Mortgage Loan on the Loan Purchase Detail) on the
Mortgaged Property described therein, and Seller has full right to sell and
assign the same to MBF.  All tax
identifications and property descriptions are legally sufficient; and tax
segregations, where required, have been completed.  The Mortgaged Property is not, and as of the
date of the origination of the Mortgage Loan was not, subject to a mortgage,
deed of trust, deed to secure debt or other security instrument creating a lien
subordinate to the 


 


1

















 


lien of the Mortgage, except to the extent permitted
by the Takeout Investor under any applicable Takeout Commitment.


 


2.             Deeds of Trust.  If 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 deed of trust, and no fees or expenses are or will
become payable by MBF to the trustee under the deed of trust, except in
connection with a trustee’s sale after default by the Mortgagor.


 


3.             Buydown Loans.  If the
Mortgage Loan is a “buydown loan”, the amount of the buydown is fully funded,
the period of the buydown does not exceed three years, and the change in the
Mortgagor’s interest rate will not exceed 1 percent per annum as a result of
the buydown, except as otherwise accepted by buyer.


 


4.             Full Disbursement of Proceeds. 
The Mortgage Loan has been closed, the proceeds of the Mortgage Loan
have been fully disbursed and there is no requirement for future advances
thereunder, and, except as specifically permitted by MBF in writing, 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 satisfied.  All costs, fees and expenses incurred in
making or closing the Mortgage Loan and the recording of the Mortgage have been
paid, the FHA mortgage insurance premium or the VA guaranty fee, if applicable,
has been paid, and the Mortgagor is not entitled to any refund of any amounts
paid or due under the Mortgage Note or Mortgage.  There is no obligation on the part of Seller,
or of any other party, to make supplemental payments in addition to those made
by the Mortgagor.  All future advances,
if any, made in connection with the Mortgage Loan 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 consolidated
principal amount does not exceed the original principal amount of the Mortgage
Loan.


 


5.             No Defenses.  The Mortgage
Loan is 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 or 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.  No such right of
rescission, set-off, counterclaim or defense has been asserted with respect
thereto, and no Mortgagor was a debtor in any state or federal bankruptcy or
insolvency proceeding at the time the Mortgage Loan was originated.  The Mortgage Loan is not subject to a
bankruptcy plan, nor has the Mortgagor filed bankruptcy.  The Mortgagor has not notified Seller or any
prior servicer of the Mortgage Loan, and Seller has no knowledge, of any relief
requested or allowed to the Mortgagor under the Soldiers’ and Sailors’ Civil
Relief Act of 1940.


 


6.             Payments Current.  All payments
due on the Mortgage Loan, if any, have been made by the Mortgagor, the Mortgage
Loan has not been delinquent (i.e. was more than thirty days past due) more
than once in the preceding 12 months, and any such delinquency lasted for no
more than 30-days.


 


2

















 


7.             No Defaults.  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 of acceleration, and neither Seller nor its
predecessors have waived any default, breach, violation or event of
acceleration.


 


8.             No Outstanding Charges.  There are no
defaults in complying with the terms of the Mortgage, and all taxes,
governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid.  Seller has not
advanced funds, or induced, solicited or knowingly received any advance of
funds by a party other than the Mortgagor, directly or indirectly, for the
payment of any amount required under the Mortgage Loan, except of interest
accruing from the date of the Mortgage Note or date of disbursement of the
Mortgage Loan proceeds, whichever is earlier, to the day which precedes by one
month the due date of the first installment of principal and interest.  No subordinate financing was used by the
Mortgagor to acquire the Mortgaged Property, except to the extent permitted by
the Takeout Investor under any applicable Takeout Commitment.


 


9.             No Mechanics’ Liens.  There are no
mechanics’ or similar liens or claims which have been filed for work, labor or
material (and no rights are outstanding that under the law could give rise to
such liens) affecting the Mortgaged Property which are or may be liens prior
to, or equal or coordinate with, the lien of the Mortgage.


 


10.           Ownership.  Immediately
prior to MBF’s purchase of the Mortgage Loan, Seller was the sole legal,
beneficial and equitable owner of record and holder of the Mortgage Loan.  Except for any applicable Takeout Commitment,
the Mortgage Loan has not been assigned or pledged and Seller has good and
marketable title thereto and full right to transfer and sell the Mortgage Loan
to MBF free and clear of any encumbrance, equity, participation interests,
lien, pledge, charge, claim or security interest.  Seller has full right and authority subject
to no interest or participation of, or agreement with, any other party, to sell
and assign the Mortgage Loan pursuant to the Agreement, and upon its purchase
of the Mortgage Loan MBF has received good and marketable title to the Mortgage
Loan free of any encumbrance, equity, participation interest, lien, pledge,
charge, claim or security interest, but subject to any applicable Takeout
Commitment.  There is no litigation pending
or, to the best of Seller’s knowledge, threatened, affecting or relating to
Seller which may in any way affect, by attachment or otherwise, the title or
interest of MBF in and to the Mortgage Loan, the Mortgaged Property or the
Mortgage Note or security instrument. 
Each MERS Designated Mortgage Loan is registered on the MERS® System.


 


11.           Occupancy of the Mortgaged Property. 
Except to the extent MBF has specifically agreed in writing to the
contrary, the Mortgaged Property is lawfully occupied by the Mortgagor 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
and fire underwriting certificates, have been made or obtained from the
appropriate authorities.


 


3

















 


12.           No Satisfaction of Mortgage. 
The Mortgage has not been satisfied, canceled, subordinated or
rescinded, in whole or in part, 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 release, cancellation,
subordination or rescission.  Seller has
not 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
resulting from any action or inaction by the Mortgagor.


 


13.           No Servicing Restrictions. 
Except as may be set forth in any applicable Takeout Commitment, no
servicing agreement has been entered into with respect to the Mortgage Loan, or
if any such servicing agreement has been entered into it has been terminated,
and there are no restrictions, contractual, statutory or otherwise, which would
impair the ability of MBF to appoint a Successor Servicer with respect to the
Mortgage Loan.


 


14.           No Refinance Agreements.  Neither
Seller nor any of its Affiliates have entered into an agreement, formal or
informal, with the Mortgagor during the initial origination process of the
Mortgage Loan to refinance the Mortgage Loan at some future date as an
inducement for the Mortgagor to enter into the original mortgage transaction.


 


15.           No Adverse Selection.  Seller used
no adverse selection procedures in selecting the Mortgage Loan from among the
outstanding first lien and second lien residential mortgage loans owned by it
which were available for sale to MBF.


 


16.           Right of Rescission.  With respect
to refinance loans, the borrower’s right of rescission has not been waived.


 


17.           No Graduated Payment or Shared Appreciation Feature. 
The Mortgage Loan is not a graduated payment mortgage loan, and the
Mortgage Loan does not have a shared appreciation or other contingent interest
feature.


 


18.           No Construction Loan.  Except as may
be permitted by MBF in writing, the Mortgage Loan was not made in connection
with the construction or rehabilitation of the Mortgaged Property.


 


19.           No Liabilities.  There are no
liabilities of Seller with respect to the Mortgage Loan or with respect to
facts or circumstances prior to the date on which MBF purchased the Mortgage
Loan for which MBF would be responsible as a result of its purchase of the
Mortgage Loan.


 


20.           Fair/Predatory Lending.  The Mortgage
Loan does not meet the definition of “mortgage” set forth in Section 1602(aa)
of the Truth-in-Lending Act.  The
Mortgage Loan was originated in full compliance with all state, city or
district “high cost” home mortgage or “predatory” lending laws, ordinances, rules or
regulations, and would not be considered a “high cost” or “predatory” mortgage
loan under any federal, state, local or municipal laws, ordinances, rules or
regulations.  No form of predatory
lending has been used in connection with the origination of the Mortgage
Loan.  For purposes of this paragraph, “predatory
lending” includes, but it is not limited to, any deceptive and/or abusive
lending practice that is not in the best 


 


4

















 


interest of the
borrower(s), including (but not limited to) any one or more of the following
practices:


 


·                  making loans:  (i) strictly
on the basis of the borrower’s equity without regard to the proper underwriting
of the borrower’s payment ability, and (ii) in a manner that unreasonably
jeopardizes the borrower’s equity;


 


·                  frequent refinancing of loans with fees that can strip
the equity from a borrower and which simply generate fee income with no benefit
to a borrower;


 


·                  using pricing terms that far exceed the true risk and
cost of making the loan;


 


·                  including in the loan unearned or otherwise
unwarranted fees for services;


 


·                  making it difficult for borrowers to reduce their
indebtedness by adding unreasonably restrictive loan terms and structures;
and/or


 


·                  targeting customers who are less financially
sophisticated or otherwise are vulnerable to abusive practices.


 


21.           Compliance with 5 Percent Fee Limitation. 
The origination points, non-pass-through fees and yield spread premium
collected on the Mortgage Loan combined do not exceed five (5) points.


 


22.           Third Party Originations. 
If the Mortgage Loan was completely or partially originated,
underwritten, closed, funded or packaged by any Person other than Seller (each
such mortgage loan, a “TPO Mortgage Loan”):


 


(a)                                  Seller has received written authorization
from the Takeout Investor to sell to MBF TPO Mortgage Loans which comply with
the terms and conditions set forth in such authorization, such authorization
has not been rescinded, terminated or revoked, and the sale of such TPO
Mortgage Loan by MBF to the Takeout Investor will not be inconsistent with, or
exceed, any limitations or restrictions stated in such authorization;


 


(b)                                 Seller has implemented, and the TPO
Mortgage Loan was subject to, prudent third-party origination risk management
procedures which identify potential deficiencies in TPO Mortgage Loans
including, but not limited to, misrepresentations of borrower income and assets
and inaccuracies in appraisal reports;


 


(c)                                  during the time the TPO Mortgage Loan was
being originated, and at the Acquisition Date, each entity that participated in
the origination of the TPO Mortgage Loan (each a “TPO”)


 


(i)                                     was duly organized, validly existing and
in good standing under the laws of such TPO’s state of organization and


 


5

















 


(ii)           had all licenses, registrations and certifications in
all applicable jurisdictions and such licenses, registrations and
certifications were in full force and effect at such times;


 


(d)                                 each TPO complied with all applicable
agreements, contracts, laws and regulations with respect to, and the violation
of which might adversely affect, the TPO Mortgage Loan or result in any cost or
liability to MBF; and


 


(e)                                  the TPO and the TPO Mortgage Loan comply
with all FNMA and FHLMC requirements for third party originated mortgage
loans.  For purposes of this
representation and warranty, Seller’s use of a “contract underwriter” will not,
by itself, cause a Mortgage Loan to be considered a TPO Mortgage Loan.  In addition, a Mortgage Loan that is
partially originated or funded by Seller’s parent corporation, or any other
Affiliate of Seller, will not be considered a TPO Mortgage Loan as long as no
unaffiliated third party participated in any aspect of the origination or
funding of the Mortgage Loan.


 


23.           Conformity to Takeout Commitment. 
The Mortgage Loan conforms in all respects with the requirements of the
Takeout Investor under any applicable Takeout Commitment.  The applicable Takeout Commitment, if any, is
a legal, valid and binding obligation of Seller and the Takeout Investor,
respectively, enforceable against Seller and the Takeout Investor in accordance
with its terms (except as enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization, conservatorship and similar laws, and
by equitable principles affecting the enforceability of the rights of
creditors, including those relating to specific performance).  The applicable Takeout Commitment is a bona
fide current, unused and unexpired commitment by the Takeout Investor pursuant
to which such Takeout Investor has irrevocably agreed to acquire the Mortgage
Loan not later than the Maximum Takeout Commitment Expiration Date, upon the
satisfaction only of those terms and conditions contained in the Takeout
Commitment, all of which, in the reasonably anticipated course of events, can
be complied with and satisfied prior to such date.


 


24.           Assignment of Takeout Commitment. 
Any Takeout Commitment related to the Mortgage Loan has been duly
assigned to MBF.  The assignment of the
Takeout Commitment with respect to such Mortgage Loan does not violate the
terms of the Takeout Commitment.


 


[Mortgage
Loan Information and Documentation]


 


25.           Mortgage Loan as Described. 
The information contained in all commitments, advises, schedules,
computer tapes or other documents or media prepared by Seller or on behalf of
Seller or otherwise furnished to MBF relating to the Mortgage Loan is complete,
true and correct.  Each of the documents
contained in the Wet Funding Documents Package or the Dry Funding Documents
Package for each Mortgage Loan is an authentic original document, except that,
if a photocopy of such document is permitted to be provided under the Agreement
(as indicated on Exhibit D), then such photocopy contained therein
is a true, correct and complete photocopy of the original document.


 


6

















 


26.           Documents.  The Mortgage
Note and the Mortgage are on forms acceptable to the Takeout Investor or are
instruments approved by MBF, and Seller has not made any representation to the
Mortgagor which is inconsistent with the mortgage instruments used.  The Mortgage contains 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, (a) in the case of a
Mortgage designated as a deed of trust, by trustee’s sale and (b) otherwise,
by judicial foreclosure.  Upon default by
the Mortgagor and foreclosure on, or trustee’s sale of, the Mortgaged Property
pursuant to the proper procedures, the holder of the Mortgage Loan will be able
to deliver good and merchantable title to the Mortgaged Property.  There is no homestead or other exemption
available to the Mortgagor which would interfere with the right to sell the
Mortgaged Property at a trustee’s sale or the right to foreclose the Mortgage
subject to applicable federal and state laws and judicial precedent with
respect to bankruptcy and right of redemption. 
Payments under the Mortgage Note are due on the first day of each month
with interest payable in arrears.


 


27.           Due on Sale.  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; by the terms of the Mortgage Note, however, the provision
for acceleration may not be exercised at the time of a transfer if prohibited
by federal law or, in the event that the mortgage interest rate for the
Mortgage Loan is adjustable, if the prospective purchaser is the transferee of
the original mortgagor, meets the applicable creditworthiness standards of the
mortgagee and pays an agreed upon fee.


 


28.           Appraisals.  The appraisal
obtained in connection with the origination of the Mortgage Loan, as well as
the appraiser who performed it, meet all of the applicable requirements of the
Takeout Investor and all applicable Agency Guidelines.  The value of the Mortgaged Property is at
least equal to the appraised value stated in the appraisal.


 


29.           Original Terms Unmodified. 
The terms of the Mortgage and Mortgage Note have not been impaired,
waived, altered or modified in any respect, except by a written instrument
which has been recorded, if necessary, to protect the interests of MBF and
which has been delivered to and approved by MBF or its designee.  The substance of any such waiver, alteration
or modification has been approved by any applicable issuer of a title insurance
policy or a primary mortgage insurance policy covering the Mortgage Loan, to
the extent required by the policy, and by the Takeout Investor, and its terms
are reflected in the Credit File.  No
Mortgagor has been released, in whole or in part, except in connection with an
assumption agreement approved by MBF, the Takeout Investor and any applicable
issuer of a title insurance policy or a primary mortgage insurance policy
covering the Mortgage Loan, to the extent required by the policy, and which
assumption agreement is part of the Credit File.


 


30.           Validity of Mortgage Documents. 
The Mortgage Note and the Mortgage are genuine, and each is the legal,
valid and binding obligation of the maker thereof enforceable in accordance
with its terms, except as such enforcement may be limited by bankruptcy,
insolvency, reorganization, receivership, moratorium or other similar laws
relating to or affecting the rights of creditors generally, and by general
equity principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law).  All
parties to the Mortgage Note 


 


7

















 


and the Mortgage and any other related agreement had
legal capacity to enter into the Mortgage Loan and to execute and deliver the
Mortgage Note and the Mortgage and any other related agreement, and the
Mortgage Note and the Mortgage and any other related agreement have been duly
and properly executed by such parties. 
The documents, instruments and agreements submitted for loan underwriting
were not falsified and contain no untrue statement of material fact or omit to
state a material fact required to be stated therein or necessary to make the
information and statements therein not misleading.  Seller has reviewed all of the documents
constituting the Credit File and has made such inquiries as it deems necessary
to make and confirm the accuracy of the representations and warranties set
forth herein.  There has been no
misrepresentation, error or fraud committed in connection with the origination
of the Mortgage Loan.


 


31.           Assignment of Mortgage.  The
assignment of mortgage to MBF or MERS is in recordable form and is acceptable
for recording under the laws of the jurisdiction in which the Mortgaged
Property is located.


 


32.           Escrow Holdback Loans.  In the event
that an escrow holdback was established in connection with the Mortgage Loan,
Seller represents and warrants that:


 


(a)                                  a temporary or final certificate of
occupancy has been issued for the Mortgaged Property;


 


(b)                                 a valid and enforceable written escrow
holdback agreement has been executed by the appropriate parties and is in the
Credit File.  The escrow holdback
agreement includes, among other things:


 


(i)            a specific description of the work to be
completed;


 


(ii)           a date on which such work must be completed;


 


(iii)          provisions for completion of the work and disbursement
of escrow funds in the event of non-completion or dispute among the parties,
and


 


(iv)          a provision that the mortgagee’s rights under the
escrow holdback agreement, including the mortgagee’s rights to the escrow
funds, are automatically transferred to any assignee of the escrow holdback
loan;


 


(c)                                  the escrow funds initially retained in
connection with the escrow holdback loan equal at least 100 percent of the
amount estimated by the contractor to complete the required improvements;


 


(d)                                 the escrow funds do not exceed the lesser
of (i) $100,000 or (ii) 5 percent of the lower of (iii) the
sales price of the Mortgaged Property or (iv) the appraised value of the
Mortgaged Property assuming the improvements or repairs for which the escrow
holdback was established were completed;


 


8

















 


(e)                                  the escrow funds are separately
identified an itemized on the final HUD-1 Settlement Statement;


 


(f)                                    no loan-to-value ratio or other
collateral exceptions have been granted by MBF in connection with the Mortgage
Loan;


 


(g)                                 the title insurance and mortgage
insurance (if applicable) have not been, and shall not be, impaired or
adversely affected during the escrow holdback period;


 


(h)                                 any and all requirements for completion
of the improvements on the Mortgaged Property shall be satisfied, and all
escrow funds shall be fully disbursed, as required by any applicable Takeout
Commitment;


 


(i)                                     as of the date of the certificate of
completion, there shall be no mechanics’ or similar liens or claims that have
been filed for work, labor or material (and no rights are outstanding that
under the law could give rise to such liens) affecting the Mortgaged Property
which are or may be liens prior to, or equal or coordinate with, the lien of
the Mortgage;


 


(j)                                     no litigation, proceeding, claim,
dispute, demand, or investigation is or shall become pending or threatened
relating to the escrow holdback agreement, the work to be performed in
accordance therewith, the escrow funds or any other matter related thereto; and


 


(k)                                  all other representations and warranties
made by Seller with respect to the Mortgage Loan are true and correct.


 


[Compliance]


 


33.           Compliance with Applicable Laws. 
The origination of the Mortgage Loan was in compliance with all federal,
state, local and municipal laws, ordinances, rules and regulations
including, without limitation, usury, truth-in-lending, real estate settlement
procedures, consumer credit protection, equal credit opportunity, fair housing
and lending disclosure laws.


 


34.           Servicing Performance.  Prior to the
Acquisition Date, the Mortgage Loan has been properly serviced in accordance
with all applicable laws, the terms of the Mortgage, Mortgage Note and related
documents.  With respect to escrow
deposits and escrow payments, all such payments are in the possession of Seller
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 all applicable laws, the Agreement and any applicable
Takeout Commitment.  An escrow of funds has
been established in an amount sufficient to pay for every item which remains
unpaid and which has been assessed but is not yet due and payable.  No escrow deposits or escrow payments or
other charges or payments due Seller have been capitalized under the Mortgage
or the Mortgage Note.  All mortgage
payment and mortgage interest rate adjustments and notices thereof have been
made in strict compliance with all applicable laws and the terms of the related
Mortgage Note and any applicable riders or modifications to the Mortgage
Note.  Any interest required to be paid 


 


9

















 


pursuant to all applicable laws has been properly paid
and credited.  All taxes, governmental
assessments, insurance premiums, water, sewer and municipal charges, leasehold
payments, ground rents relating to the Mortgage Loan have been paid to the
extent such items are required to be paid pursuant to prudent mortgage banking
standards and as herein provided.


 


35.           Acceptable Investment.  Seller has no
knowledge of any circumstances or conditions with respect to the Mortgage Note,
the Mortgage, the Mortgaged Property, the Mortgagor or the Mortgagor’s credit
standing that could be expected to cause private institutional investors to
regard the Mortgage Loan as an unacceptable investment, cause the Mortgage Loan
to become delinquent, or adversely affect the value or marketability of the
Mortgage Loan.


 


36.           Agency Requirements.  If the
Mortgage Loan is to be acquired by the Takeout Investor under its (a) FHA
or VA mortgage loan purchase programs, the mortgage loan complies with all
applicable HUD and VA guidelines and regulations, including those relating to
underwriting, is insured or guaranteed by FHA or VA, as applicable, complies
with all GNMA requirements relating to mortgage loans included in the GNMA
mortgage-backed securities pools, and complies or shall comply, on or before
the prescribed dates with all GNMA document custodian requirements; and (b) conventional
conforming mortgage loan purchase program, the Mortgage Loan complies with all
applicable Fannie Mae and Freddie Mac guidelines, including those relating to
underwriting, all Fannie Mae and Freddie Mac requirements relating to mortgage
loans included in Fannie Mae or Freddie Mac mortgage-backed securities pools,
and complies or shall comply, on or before the prescribed dates, with all
Fannie Mae or Freddie Mac document custodian requirements.


 


37.           Doing Business.  All 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) (a) in compliance with any and all
applicable licensing requirements of the laws of the state wherein the
Mortgaged Property is located and (b) (i) organized under the laws of
such state, (ii) qualified to do business in such state, (iii) a
federal savings and loan association or national bank having principal offices
in such state, or (iv) not doing business in such state.


 


38.           Origination; Loan Terms.  The Mortgage
Loan was originated by a mortgagee approved by the Secretary of Housing and
Urban Development pursuant to Sections 203 and 211 of the National Housing Act
or a savings and loan association, a savings bank, a commercial bank or similar
banking institution which is supervised and examined by a federal or state
authority.


 


39.           Underwriting.  The Mortgage
Loan was underwritten in accordance with CL’s underwriting guidelines and any
underwriting conditions relating to the Mortgage Loan were fully satisfied, the
satisfaction of those underwriting conditions is properly documented in
accordance with standard industry practices, and such documentation has been
submitted to the Takeout Investor.


 


40.           Compliance with Seller Guide. 
The Mortgage Loan and all documents related thereto comply, in all
material respects, to all applicable terms, conditions and requirements set
forth in the Seller Guide, whether or not the Takeout Investor will be CL.


 


10

















 


41.           Prepayment Fees.  In the event
that the Mortgage Note requires the Mortgagor to pay a fee if the Mortgage Loan
is prepaid in full or part within the time periods specified in the Mortgage
Note, the provision in the Mortgage Note requiring the payment of such fee (the
“Prepayment Provision”) complies with all applicable local, state and federal
law, all disclosures required under all applicable law in connection with the
Prepayment Provision have been properly provided to the Mortgagor and the
enforcement of the Prepayment Provision in accordance with the terms set forth
in the mortgage note will be in compliance with all applicable laws and
regulations.


 


[Insurance]


 


42.           Primary Mortgage Insurance. 
In the event the Mortgage Loan has a loan-to-value ratio greater than
80%, the excess of the principal balance of the Mortgage Loan over 75% of the
appraised value is and will be insured as to payment defaults by a primary
mortgage insurance policy issued by a mortgage insurer approved by MBF.  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.  If the Mortgage Loan provides for negative
amortization or for the potential for negative amortization, the primary
mortgage insurance policy insures any increase in the principal balance from
the original balance of the mortgage note. 
If the Mortgage Loan is subject to a primary mortgage insurance policy
the Mortgagor is obligated thereunder to maintain the primary mortgage
insurance policy and to pay all premiums and charges in connection
therewith.  There has been no act or
omission which would or may invalidate any such primary mortgage insurance
policy.  The primary mortgage insurance
policy is eligible for reinsurance by MBF and its Affiliates.  There are no defenses, counterclaims, or
rights of set-off against MBF affecting the validity or enforceability of the
primary mortgage insurance policy.


 


43.           Government Loans.  If the
Mortgage Loan is subject to a commitment which provides that such Mortgage Loan
will be guaranteed by the VA or insured by the FHA, the Mortgage Loan is fully
guaranteed or insured, as applicable, and all insurance premiums or guarantee
fees due on or before the purchase date have been paid in full.


 


44.           Title Insurance.  The Mortgage
Loan is covered by an ALTA form of lender’s title insurance policy or other
generally acceptable form of policy of insurance acceptable to FNMA or FHLMC,
issued by, and the binding obligation of, a title insurer acceptable to FNMA or
FHLMC and qualified to do business in the jurisdiction where the Mortgaged
Property is located, insuring Seller, its successors and assigns, as to the
first priority lien (if the Mortgage Loan is indicated by Seller to be a first
lien Mortgage Loan on the Loan Purchase Detail) of the Mortgage in the original
principal amount of the Mortgage Loan (or, to the extent that the Mortgage Note
provides for negative amortization, the sum of such original principal amount
and the maximum amount of negative amortization permitted in accordance with
the Mortgage Note), or as to the second priority lien (if the Mortgage Loan is
indicated by Seller to be a second lien Mortgage Loan on the Loan Purchase
Detail) of the Mortgage in the combined original principal amount of the
Mortgage Loan and the original principal amount of the first lien mortgage loan
(or, to the extent that the Mortgage Note provides for negative amortization,
the sum of the original principal amount of the Mortgage Loan, the original
principal amount of the first lien mortgage loan and the maximum amount of
negative amortization permitted in 


 


11

















 


accordance with the Mortgage Note), and against any
loss by reason of the invalidity or unenforceability of the lien resulting from
the provisions for the Mortgage providing for adjustment in the mortgage
interest rate and monthly payment.  Where
required by state law or regulation, the Mortgagor has been given the
opportunity to choose the carrier of the required title insurance unless the
premium for such insurance was not paid by the Mortgagor.  Additionally, such lender’s title insurance
policy affirmatively insures ingress and egress, and against encroachments by
or upon the Mortgaged Property or any interest therein.  Seller is the sole insured of such lender’s
title insurance policy, and such lender’s title insurance policy is in full
force and effect and will inure to the benefit of MBF without any further
act.  No claims have been made under such
lender’s title insurance policy, and no prior holder of the Mortgage, including
Seller, has done, by act or omission, anything which would impair the coverage
of such lender’s title insurance policy. 
If the Mortgage Loan has a negative amortization feature, the lender’s
title insurance policy provides coverage in the amount of 110 percent of the
initial amount of the Mortgage Loan (if the Mortgage Loan is indicated by
Seller to be a first lien Mortgage Loan on the Loan Purchase Detail) or 110
percent of the combined initial amounts of the first lien mortgage loan and the
Mortgage Loan (if the Mortgage Loan is indicated by Seller to be a second lien
Mortgage Loan on the Loan Purchase Detail).


 


45.           Hazard and Flood Insurance. 
The improvements upon the Mortgaged Property are insured against loss by
fire and other hazards as required by the Takeout Investor, including flood
insurance if required under the National Flood Insurance Act of 1968, as
amended.  The Mortgage requires Mortgagor
to maintain such casualty insurance at the Mortgagor’s expense, and upon the
Mortgagor’s failure to do so, authorizes the holder of the Mortgage to obtain
and maintain such insurance at the Mortgagor’s expense and to seek
reimbursement therefore from the Mortgagor. 
The hazard insurance policy is the valid and binding obligation of the
insurer, and is in full force and effect and will inure to the benefit of MBF
upon its purchase of the Mortgage Loan. 
All flood insurance and hazard insurance premiums have been paid when
due.  Where required by state law or
regulation, the Mortgagor has been given the opportunity to choose the carrier
of the hazard insurance unless either a “master” or “blanket” hazard insurance
policy covering the condominium project or planned unit development in which
the Mortgaged Property is located was obtained. 
Additionally, if the Mortgaged Property is an individual unit in a
condominium project or an individual unit in a planned unit development, then
general liability, fidelity and all other insurance required by the Takeout
Investor is maintained in connection with the condominium project or planned
unit development, and each required insurance policy is in a form and amount,
and is issued by an insurer, that is acceptable to the Takeout Investor .  Seller has not engaged in, and has no
knowledge of the Mortgagor’s or of any prior servicer of the Mortgage Loan
having engaged in, any act or omission which would impair the coverage of any
such policy, the benefits of the endorsement provided for therein or the
validity and binding effect of either.


 


46.           Coverage of Insurance.  No action,
inaction, or event has occurred and no state of facts exists or has existed
that has resulted or will result in the exclusion from, denial of, or defense
to coverage under any applicable insurance policy or guarantee including, but
not limited to, a title insurance policy, a hazard insurance policy, a primary
mortgage insurance policy, FHA insurance coverage, a VA guarantee or a mortgage
pool insurance policy obtained in connection with the Mortgage Loan.  In connection with the placement of any such
insurance or guarantee, no commission, fee, other unlawful compensation or
value of any kind has been or will be 


 


12

















 


received by Seller or any designee of Seller or any
corporation in which Seller or any officer, director or employee of Seller had
a financial interest at the time of placement of such insurance and, to the
best of Seller’s knowledge, no such commission, fee, other unlawful
compensation or value of any kind has been received by any attorney, firm or
other person or entity.


 


[Mortgaged
Property]


 


47.           No Additional Collateral. 
The Mortgage Note is not and has not been secured by any collateral
except the lien of the Mortgage.


 


48.           Location of Improvements. 
All improvements which were considered in determining the appraised
value of the Mortgaged Property lay wholly within the boundaries and building
restriction lines of the Mortgaged Property, no improvements on adjoining
properties encroach upon the Mortgaged Property, or the policy of title
insurance affirmatively insures against loss or damage by reason of any
violation, variation, encroachment or adverse circumstance which is either
disclosed or would have been disclosed by an accurate survey.  No improvement located on or being part of
the Mortgaged Property is in violation of any applicable zoning law or
regulation.


 


49.           Environmental Matters.  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.  The Mortgaged Property is
not within a one-mile radius of any site listed in the National Priorities List
as defined under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, or on any similar state list of hazardous
wastes that are known to contain any hazardous substances or hazardous wastes.


 


50.           No Encroachments.  No
improvements on adjoining properties encroach upon the Mortgaged Property in
any respect so as to effect the value or marketability of the Mortgage Loan or
the Mortgaged Property.


 


51.           Condominiums/Planned Unit Developments. 
If the Mortgaged Property is a condominium unit or a planned unit
development, such condominium or planned unit development project has been
approved by the Takeout Investor, meets FNMA, FHLMC or FHA eligibility
requirements for sale to FNMA, FHLMC or FHA (as applicable) or is located in a
condominium or planned unit development project which has received FNMA, FHLMC
or FHA project approval, and the representations and warranties required by
FNMA, FHLMC or FHA with respect to such condominium or planned unit
developments are deemed to have been made by Seller to MBF and remain true and
correct in all respects.  The Credit File
contains all required condominium and planned unit development riders to the
Mortgage and Mortgage Note.


 


52.           No Condemnation and Mortgaged Property Undamaged. 
There is no proceeding pending or threatened for the total or partial
condemnation of the Mortgaged Property. 
The Mortgaged Property 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.


 


53.           Detrimental Conditions.  As of the
origination date and the Acquisition Date of the Mortgage Loan, Seller did not
know, nor did Seller have any reason to know, that the 


 


13

















 


Mortgaged Property and the improvements constructed
thereon were subject to any detrimental conditions which could reasonably be
expected to adversely affect the market value of the Mortgaged Property.  The term “detrimental conditions” includes,
but is not limited to, expansive soils, underground mines, soil subsidence,
landfills, superfund sites, special study zones, and other conditions which
affect the stability of the improvements erected on the Mortgaged Property or
the drainage on or from the Mortgaged Property.


 


54.           Location and Type of Mortgaged Property. 
The Mortgaged Property consists of a single parcel of real property with
a detached single family residence erected thereon, or a two-to-four family
dwelling, or an individual condominium unit in a condominium project, or an
individual unit in a planned unit development. No portion of the Mortgaged
Property is used for commercial purposes.


 


55.           Land Trust Loans.  If legal and
equitable title to the Mortgaged Property is held by a land trust, Seller
represents the following:


 


(a)           the Mortgaged Property is located in the State of
Illinois;


 


(b)           the land trust is duly formed and validly existing
under the laws of the State of Illinois;


 


(c)           the documents relating to the Mortgage are the binding
obligations of the land trust and the beneficiaries of the land trust and such
documents are enforceable against the parties in accordance with their
respective terms;


 


(d)           the beneficiaries of the land trust have covenanted to
perform or to cause the land trustee to perform, as applicable, all of the
obligations imposed upon the borrower under the security instrument;


 


(e)           neither the Mortgaged Property nor the interests of
the beneficiaries in the land trust may be transferred except in accordance
with the provisions of the security instrument;


 


(f)            to the extent permitted by law, the beneficiaries of
the land trust have directed the land trustee to waive, and the land trustee
has waived, any and all rights of redemption from sale in accordance with the
terms of the security instrument;


 


(g)           the interests of the beneficiaries are deemed personal
property under Illinois law;


 


(h)           Seller has assigned to MBF Seller’s rights under a
binding, valid and enforceable agreement among the trustee of the land trust,
the beneficiaries of the land trust and Seller pursuant to which the trustee
agreed to notify Seller in writing in the event that any beneficiary attempts
to transfer, assign or otherwise convey a beneficial interest in the land trust
to a third party; and


 


(i)            the Mortgage Loan complies with all of the
requirements of FNMA for land trust loans.


 


14

















 


56.           Leasehold Loans.  If the
Mortgage Loan is secured by a leasehold estate, Seller represents the
following:


 


(a)           the property subject to the lease is located in an
area in which leasehold loans have received market acceptance;


 


(b)           the Mortgage and the title insurance policy cover the
improvements to the property and the Mortgagor’s leasehold interest in the
land;


 


(c)           the term of the leasehold estate exceeds the maturity
of the Mortgage Note by at least 10 years unless fee simple title vests in the
Mortgagor or an owner’s association on an earlier date;


 


(d)           the leasehold estate, and any purchase option with
respect to the land, is assignable or transferable;


 


(e)           the lease does not contain any default provisions that
could give rise to termination of the lease except for non-payment of the lease
rents;


 


(f)            the lease is valid, and in full force and effect and
there is no default under any provision of the lease;


 


(g)           the lease provides that:


 


(i)            the Mortgagor will pay taxes, insurance and homeowner’s
association dues related to the land, in addition to those the Mortgagor is
paying with respect to the improvements;


 


(ii)           the Mortgagor retains voting rights in any homeowner’s
association;


 


(iii)          if the lease contains an option for the Mortgagor to
purchase the fee interest in the land, the purchase is at the Mortgagor’s sole
option, there is no time limit within which the option must be exercised and
the purchase price is the lower of (x) the current appraised value of the
land and (y) the product of the percentage of the total original appraised
value that represented the land alone and the appraised value of the land and
improvements


 


(iv)          the leasehold can be transferred, mortgaged and sublet
an unlimited number of times either without restriction or on payment of a
reasonable fee and delivery of reasonable documentation to the lessor; and


 


(v)           the lessor will provide the mortgagee with at least
thirty (30) days notice of the Mortgagor’s default under the lease and give the
mortgagee the option to (x) cure the default or (y) take over the
Mortgagor’s rights under the lease.


 


(h)           the lessor may not require a credit review or impose
other qualifying criteria on any transferee, mortgagee or sublessee;


 


15

















 


(i)            the leasehold estate and the Mortgage may not be
impaired by any merger of title between lessor and lessee or by any default of
a sublessor; and


 


(j)            the lease and the leasehold estate meet all of the
requirements of FNMA for leasehold loans.


 


[Hedging
Arrangements]


 


57.           Hedging Arrangements.  If the
Mortgage Loan is not the subject of a Takeout Commitment at the time of
purchase hereunder, Seller has entered into a Hedging Arrangement applicable to
it which has been disclosed to (and approved by) MBF with a Person reasonably
satisfactory to MBF.


 


16














 


Annex 3


 


Mortgage Loans Subject to
CL Commitments


 


1.             Additional
Definitions. In addition to the definitions set forth in Section 1 of
the Agreement, the following definitions apply:


 


“AOT Commitment” means a CL Commitment
issued by CL under its Assignment of Trade (AOT) commitment option program,
which is part of the CL Program.


 


“CL
Commitment” means any irrevocable commitment issued by CL
pursuant to CL Program to acquire one or more Mortgage Loans on or before a
specified delivery date.


 


“CL
Funding” means, with respect to a Mortgage Loan subject to a
CL Commitment, the completion of the transactions required to be completed on
the CL Funding Date.


 


“CL Funding Advice”
means the Takeout Funding Advice prepared by CL and delivered to Seller on or
before the CL Funding Date itemizing, for a particular Mortgage Loan, the net
amount payable by CL.


 


“CL
Funding Date” means the date on which CL acquires ownership
of a Mortgage Loan from Seller pursuant to the terms of the CL Commitment.


 


“Option
ARM Loan” means a Mortgage Loan that is an adjustable rate
product tied to either the 12-MTA Index (Monthly Treasury Averaged), the 11th
District Cost of Funds Index (COFI), or another variable index approved for use
in Mortgage Loans by CL and originated for sale to CL.


 


2.             Modified or
Clarified Definitions. The definitions set forth in Section 1 of the
Agreement are clarified or modified, as applicable, as follows:


 


“Credit File”:  In the case of a Mortgage Loan originated for
sale to CL under the CL Program, the “Credit File” shall contain all of the
records required to be included in the “Credit File” or “credit package”
described in Chapter 400 and other portions of the Seller Guide.


 


“Investment Return Rate”:  For an Option ARM Loan only, the “Investment
Return Rate” means the lesser of (i) the interest rate specified in the
promissory note for that Mortgage Loan and (ii) the LIBOR Rate plus 162.5
basis points (1.625%) per annum.


 


“Scheduled
Repurchase Date”:  For a Mortgage Loan that is subject to a CL
Commitment, the “Scheduled Repurchase Date” shall be the same date as the CL
Funding Date.


 


“Takeout Commitment”:  A CL Commitment is one form of a Takeout
Commitment.


 


“Takeout
Funding”:  A CL Funding is one form of Takeout Funding.


 


“Takeout Funding Advice”:  A CL Funding Advice is one form of a Takeout
Funding Advice.


 


1

















 


“Takeout
Guidelines”:  In
the case of the CL Program, the Takeout Guidelines include (but are not limited
to) the Seller Guide.


 


“Takeout
Investor”:  In addition to the to the investors listed on
Exhibit I, “Takeout Investor” includes CL.


 


3.             Seller’s
Continuing Duties. Without limiting the generality of Section 6 of the
Agreement, Seller shall obtain and timely deliver to CL the additional
documents required under the AOT Commitment option program for each purchased
Mortgage Loan for which an AOT Commitment had been issued.


 


4.             Second Closing.
In the case of a Mortgage Loan originated for sale to CL under the CL Program
which MBF has purchased under the Agreement on a servicing-retained basis, if
Seller has designated CL to receive the documents and rights conveyed by MBF
pursuant to subsection 7.3(b) of the Agreement, then the retention by MBF
of the Mortgage Note pursuant to Section 7.1 of the Agreement and delivery
of documents and conveyance of rights by MBF to CL as designee of Seller under
subsection 7.3(b) of the Agreement shall be considered the conveyance of
the Mortgage Note, such other documents and rights to CL by Seller for the
purpose of establishing Seller’s obligations to complete certain post-sale
obligations (and the time periods therefor described in the CL Program). For
example, Seller’s obligation under the CL Program to deliver to CL all final
closing documents in connection with a Mortgage Loan within the time period
described in the Seller Guide shall be measured from the Repurchase Date. On
and after the Repurchase Date, CL shall have all rights, privileges and
remedies with respect to a Mortgage Loan purchased under the Agreement as it
has for Mortgage Loans purchased directly from Seller under the CL Program,
including the post-sale remedies described in Chapter 600 of the Seller Guide,
and CL shall manage the ownership and servicing of Mortgage Loans purchased
under the Agreement as it does all Mortgage Loans purchased directly by it in
the first instance under the CL Program.


 


5.             Note Shipment.
Notwithstanding Section 7.1 of the Agreement, if the Mortgage Loan is
subject to a CL Commitment, the parties agree that MBF shall retain the
Mortgage Note for the benefit of CL.


 


6.             Early
Repurchases. Notwithstanding clause (iii) of Section 8.2(a) of
the Agreement, the refusal of CL to honor its Takeout Commitment and complete
the purchase of a Mortgage Loan shall not give MBF the right to require the
early repurchase of the Mortgage Loan as provided in Section 8.2(a) of
the Agreement; provided, however, that if CL has rejected a
Mortgage Loan, for any reason, then MBF shall have the right to require the
early repurchase of the Mortgage Loan pursuant to Section 8.2(a) of
the Agreement. In addition to its obligations under Section 8.2(b) of
the Agreement, upon receipt of the provisional Repurchase Price from Seller,
MBF shall deliver, or cause to be delivered, to Seller all documents for the
Mortgage Loan previously delivered to CL.


 


7.             CL Program
Obligations. On or after the CL Funding Date for a Mortgage Loan originated
for sale to CL under the CL Program but purchased under the Agreement, Seller
shall have such continuing repurchase obligations for such Mortgage Loan as are
provided in the CL Program and all purchase and sale agreements entered
thereunder, and nothing in the Agreement


 


2

















 


shall
relieve Seller of its duties and obligations under the CL Program (or similar
program) during the Post-Origination Period.


 


8.             Additional
Representations and Warranties Concerning Seller. Seller represents and
warrants as of the Effective Date and as of each Acquisition Date as follows:
Seller meets all of the eligibility requirements set forth in the Seller Guide
for participation in the CL Program and is currently approved by CL to
participate in the CL Program.


 


9.             Additional
Representations and Warranties Concerning Mortgage Loans. With respect to a
Mortgage Loan for which a CL Commitment has been issued under the CL Program,
in addition to each of the representations and warranties set forth in Annex 2,
Seller makes each of the additional Seller representations and warranties about
the Mortgage Loan contained in the Seller Guide, which are hereby incorporated
by this reference.


 


3

















 


Annex 4


 


Provisions Relating to
Type 1 Nonconforming Loans


 


1.             Additional
Definitions. In addition to the definitions set forth in Section 1 of
the Agreement, the following definitions apply:


 


“Type 1 Nonconforming Loan” means a Mortgage
Loan about which not all of representations and warranties set forth in Annex
2 are true and correct but about which all of the representations and
warranties in Section 7 of Annex 4 are true and correct.


 


“Type 1 Nonconforming Loan Sublimit” means
$120,000,000.00 at any one time.


 


“1NC1 Loan” means a Type 1 Nonconforming
Loan that is a first lien Mortgage Loan.


 


“2NC1 Loan” means a Type 1 Nonconforming
Loan that is a second lien Mortgage Loan.


 


“1NC1 Sub-sublimit” means $120,000,000.00 at
any one time.


 


“2NC1 Sub-sublimit” means $15,000,000.00 at
any one time.


 


2.             Modified or
Clarified Definitions. The definitions set forth in Section 1 of the Agreement
are clarified or modified, as applicable, as follows:


 


“Acquisition Price”: 
For a 1NC1 Loan, the “Acquisition Price” means an amount equal to
ninety-eight percent (98%) of the amount which the Takeout Investor has
provisionally committed to pay for such Mortgage Loan in its Takeout
Commitment, but in no event more than the Par Value of such a Mortgage Loan. For
a 2NC1 Loan, the “Acquisition Price” means an amount equal to ninety-six
percent (96%) of the amount which the Takeout Investor has provisionally
committed to pay for such Mortgage Loan in its Takeout Commitment, but in no
event more than the Par Value of such a Mortgage Loan.


 


“Investment Return Rate”: 
For a 1NC1 Loan only, the “Investment Return Rate” means the LIBOR Rate
plus 162.5 basis points (1.625%) per annum. For a 2NC1 Loan only, the “Investment
Return Rate” means the LIBOR Rate plus 162.5 basis points (1.625%) per annum.


 


“Maximum
Takeout Commitment Expiration Date”:  For a 1NC1 Loan only, the “Maximum Takeout
Commitment Expiration Date” means the date that is ninety (90) days after the
Acquisition Date for such a Mortgage Loan. For a 2NC1 Loan only, the “Maximum
Takeout Commitment Expiration Date” means the date that is ninety (90) days
after the Acquisition Date for such a Mortgage Loan.


 


3.             Purchase and
Sale. The following sentence is added to Section 2 of the Agreement:


 


In no event shall MBF be required to purchase any Type
1 Nonconforming Loan if the Acquisition Price of such Type 1 Nonconforming
Loan, when combined


 


1

















 


with the aggregate Acquisition Price of all Type 1
Nonconforming Loans then held by MBF (and then serviced by Seller or a
Successor Servicer), is in excess of the Type 1 Nonconforming Loan Sublimit. In
no event shall MBF be required to purchase any 1NC1 Loan if the Acquisition
Price of such 1NC1 Loan, when combined with the aggregate Acquisition Price of
all 1NC1 Loans then held by MBF (and then serviced by Seller or a Successor
Servicer), is in excess of the 1NC1 Sub-sublimit. In no event shall MBF be
required to purchase any 2NC1 Loan if the Acquisition Price of such 2NC1 Loan,
when combined with the aggregate Acquisition Price of all 2NC1 Loans then held
by MBF (and then serviced by Seller or a Successor Servicer), is in excess of
the 2NC1 Loan Sub-sublimit.


 


4.             Seller’s
Repurchase Obligations. The following sentence is added to the end of
subsection 8.2(a) of the Agreement:


 


In the case of a Type 1 Nonconforming Loan, if Seller
fails to obtain a Takeout Commitment for such Type 1 Nonconforming Loan, or
fails to provide to MBF a true and correct photocopy of it or information about
it required by Section 13.15, within ninety (90) days after the
Acquisition Date, MBF may notify Seller, and notify Seller, and Seller shall
promptly repurchase such Mortgage Loan at the Repurchase Price on the date of
repurchase.


 


5.             Additional
Seller’s Covenants. Section 13 of the Agreement is amended by the
addition of the following Section 13.15:


 


13.15       Takeout Commitment—Type
1. Seller shall make a commercially reasonable effort to obtain a Takeout
Commitment for each Type 1 Nonconforming Loan, and Seller shall provide to MBF
a true and correct photocopy of it or information about it (in such format and
by such media as MBF may from time to time determine) as soon as practicable
after Seller has obtained the Takeout Commitment. MBF acknowledges that a
Takeout Commitment for a Type 1 Nonconforming Loan may take the form of a
bulk trade commitment concerning a number of Type 1 Nonconforming Loans and
certain other loans.


 


6.             Representations
and Warranties Concerning Type 1 Nonconforming Loans. Notwithstanding
anything to the contrary in Section 11 of the Agreement, with respect to a
Type 1 Nonconforming Loan, Seller only makes each of the following
representations and warranties set forth in Annex 2: 1-38 (inclusive),
41, and 43-end (inclusive). In addition, Seller also makes each of the
additional representations and warranties with respect to each Type 1
Nonconforming Loan set forth below:


 


(1)                                  First
or Second Lien Loan. The Mortgage is a first lien or a second lien on the
Mortgaged Property.


 


(2)                                  FICO
Scores. At the time of origination the Mortgagor had a score on the FICO
scale of at least 620.


 


2

















 


(3)                                  Loan-to-Value
Ratio. If the Mortgage Loan is indicated by Seller to be a first lien
Mortgage Loan on the Loan Purchase Detail, the loan-to-value ratio of the
Mortgage Loan is not in excess of 100%. If the Mortgage Loan is indicated by
Seller to be a second lien Mortgage Loan on the Loan Purchase Detail, the
loan-to-value ratio of the first lien mortgage loan and the Mortgage Loan
combined is not in excess of 100%.


 


(4)                                  Debt
Service-to-Income Ratio. At the time of origination of the Mortgage Loan,
the ratio of the scheduled aggregate annual principal payment on the Mortgage
Loan to the annual income of the Mortgagor was not in excess of 50%.


 


(5)                                  Mississippi
Loans. The Mortgaged Property is not located in the State of Mississippi.


 


(6)                                  Documentation.
The Mortgage Loan was documented in compliance with Seller’s full or stated
documentation program.


 


(7)                                  Maximum
Cash Out. If the Mortgage Loan 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,
the proceeds of the Mortgage Loan did not exceed the amount of the existing
mortgage by more than $150,000.


 


(8)                                  No
Mobile Home/Manufactured Housing Loans. The Mortgage Loan is not secured by
a mobile home or by manufactured housing.


 


(9)                                  No
Negative Amortization. The Mortgage Loan does not provide for negative
amortization or for the potential for negative amortization.


 


(10)                            Loan
Size Limit. If the Mortgage Loan is indicated by Seller to be a first lien
Mortgage Loan on the Loan Purchase Detail, the principal amount of the Mortgage
Loan is not in excess of $1,000,000 on the Acquisition Date for such Mortgage
Loan; if it is indicated by Seller to be a second lien Mortgage Loan on the
Loan Purchase Detail, the principal amount of the Mortgage Loan is not in
excess of $500,000 on the Acquisition Date for such Mortgage Loan.


 


3

















 


Annex 5


 


Provisions Relating to
Type 2 Nonconforming Loans


 


1.             Additional
Definitions. In addition to the definitions set forth in Section 1 of
the Agreement, the following definitions apply:


 


“Type 2 Nonconforming Loan” means a Mortgage
Loan about which not all of representations and warranties set forth in Annex
2 are true and correct but about which all of the representations and
warranties in Section 7 of Annex 5 are true and correct.


 


“Type 2 Nonconforming Loan Sublimit” means
$30,000,000.00 at any one time.


 


“1NC2 Loan” means a Type 2 Nonconforming
Loan that is a first lien Mortgage Loan.


 


“2NC2 Loan” means a Type 2 Nonconforming
Loan that is a second lien Mortgage Loan.


 


“1NC2 Sub-sublimit” means $30,000,000.00 at
any one time.


 


“2NC2 Sub-sublimit” means $2,000,000.00 at
any one time.


 


2.             Modified or Clarified
Definitions. The definitions set forth in Section 1 of the Agreement
are clarified or modified, as applicable, as follows:


 


“Acquisition Price”: 
For a 1NC2 Loan, the “Acquisition Price” means an amount equal to
ninety-seven percent (97%) of the lesser of (a) the Par Value of such 1NC2
Loan and (b) the Market Value of such 1NC2 Loan. For a 2NC2 Loan, the “Acquisition
Price” means an amount equal to ninety-six percent (96%) of the lesser of (a) the
Par Value of such 2NC2 Loan and (b) the Market Value of such 2NC2 Loan.


 


“Investment Return Rate”: 
For a 1NC2 Loan only, the “Investment Return Rate” means the LIBOR Rate
plus 187.5 basis points (1.875%) per annum. For a 2NC2 Loan only, the “Investment
Return Rate” means the LIBOR Rate plus 187.5 basis points (1.875%) per annum.


 


“Maximum
Takeout Commitment Expiration Date”:  For a 1NC2 Loan only, the “Maximum Takeout
Commitment Expiration Date” means the date that is ninety (90) days after the
Acquisition Date for such a Mortgage Loan. For a 2NC2 Loan only, the “Maximum
Takeout Commitment Expiration Date” means the date that is ninety (90) days
after the Acquisition Date for such a Mortgage Loan.


 


3.             Purchase and
Sale. The following sentence is added to Section 2 of the Agreement:


 


In no event shall MBF be required to purchase any Type
2 Nonconforming Loan if the Acquisition Price of such Type 2 Nonconforming
Loan, when combined with the aggregate Acquisition Price of all Type 2
Nonconforming Loans then held by MBF (and then serviced by Seller or a Successor
Servicer), is in excess of


 


1

















 


the Type 2 Nonconforming Loan Sublimit. In no event
shall MBF be required to purchase any 1NC2 Loan if the Acquisition Price of
such 1NC2 Loan, when combined with the aggregate Acquisition Price of all 1NC2
Loans then held by MBF (and then serviced by Seller or a Successor Servicer),
is in excess of the 1NC2 Sub-sublimit. In no event shall MBF be required to
purchase any 2NC2 Loan if the Acquisition Price of such 2NC2 Loan, when
combined with the aggregate Acquisition Price of all 2NC2 Loans then held by
MBF (and then serviced by Seller or a Successor Servicer), is in excess of the
2NC2 Loan Sub-sublimit.


 


4.             Seller’s
Repurchase Obligations. The following sentence is added to the end of
subsection 8.2(a) of the Agreement:


 


In the case of a Type 2 Nonconforming Loan, if Seller
fails to obtain a Takeout Commitment for such Loan, or fails to provide to MBF
a true and correct photocopy of it or information about it as required by Section 13.16,
within ninety (90) days after the Acquisition Date, MBF may notify Seller, and
Seller shall promptly repurchase such Mortgage Loan at the Repurchase Price on
the date of repurchase.


 


5.             Additional
Seller’s Covenants. Section 13 of the Agreement is amended by the
addition of the following Section 13.16:


 


13.16       Takeout Commitment—Type
2. Seller shall make a commercially reasonable effort to obtain a Takeout
Commitment for each Type 2 Nonconforming Loan, and Seller shall provide to MBF
a true and correct photocopy of it or information about it (in such format and
by such media as MBF may from time to time determine) as soon as practicable
after Seller has obtained the Takeout Commitment. MBF acknowledges that a
Takeout Commitment for a Type 2 Nonconforming Loan may take the form of a bulk
trade commitment concerning a number of Type 2 Nonconforming Loans and
certain other loans.


 


6.             Representations
and Warranties Concerning Type 2 Nonconforming Loans. Notwithstanding
anything to the contrary in Section 11 of the Agreement, with respect to a
Type 2 Nonconforming Loan, Seller only makes each of the following
representations and warranties set forth in Annex 2: 1-38 (inclusive),
41, and 43-end (inclusive). In addition, Seller also makes each of the additional
representations and warranties with respect to each Type 2 Nonconforming Loan
set forth below:


 


(1)                                  FICO
Scores. If the Mortgage Loan is indicated by Seller to be a first lien
Mortgage Loan on the Loan Purchase Detail, at the time of origination the
Mortgagor had a score on the FICO scale of at least 550. If the Mortgage Loan
is indicated by Seller to be a second lien Mortgage Loan on the Loan Purchase
Detail, at the time of origination the Mortgagor had a score on the FICO scale
of at least 620.


 


2

















 


(2)                                  Loan-to-Value
Ratio. If the Mortgage Loan is indicated by Seller to be a first lien
Mortgage Loan on the Loan Purchase Detail, the loan-to-value ratio of the
Mortgage Loan is not in excess of 90%. If the Mortgage Loan is indicated by
Seller to be a second lien Mortgage Loan on the Loan Purchase Detail, the
loan-to-value ratio of the first lien mortgage loan and the Mortgage Loan
combined is not in excess of 90%.


 


(3)                                  Debt
Service-to-Income Ratio. At the time of origination of the Mortgage Loan,
the ratio of the scheduled aggregate annual principal payment on the Mortgage
Loan to the annual income of the Mortgagor was not in excess of 50%.


 


(4)                                  Mississippi
Loans. The Mortgaged Property is not located in the State of Mississippi.


 


(5)                                  Documentation.
The Mortgage Loan was documented in compliance with Seller’s full or stated
documentation program.


 


(6)                                  Maximum
Cash Out. If the Mortgage Loan 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,
the proceeds of the Mortgage Loan did not exceed the amount of the existing
mortgage by more than $150,000.


 


(7)                                  No
Mobile Home/Manufactured Housing Loans. The Mortgage Loan is not secured by
a mobile home or by manufactured housing.


 


(8)                                  No
Negative Amortization. The Mortgage Loan does not provide for negative
amortization or for the potential for negative amortization.


 


(9)                                  Loan
Size Limit. The principal amount of the Mortgage Loan is not in excess of
$500,000 on the Acquisition Date for such Mortgage Loan.


 


3

















 


Annex 6


 


Provisions Relating to
Type 3 Nonconforming Loans


 


Intentionally deleted.


 


1

















 


Annex 7


 


Provisions Relating to
Undesignated Loans


 


1.             Additional
Definitions. In addition to the definitions set forth in Section 1 of
the Agreement, the following definition applies:


 


“Undesignated Loan” means a Mortgage Loan (i) that
is not a Type 1 Nonconforming Loan, a Type 2 Nonconforming Loan, or a Type 3
Nonconforming Loan and (ii) that is not subject to or covered by a Takeout
Commitment on the applicable Acquisition Date.


 


2.             Modified or Clarified
Definitions. The definition of “Acquisition Price” set forth in Section 1
of the Agreement is modified as follows:


 


“Acquisition Price”: 
For an Undesignated Loan, the “Acquisition Price” means an amount equal
to ninety-eight percent (98%) of the Market Value of such Mortgage Loan, but in
no event more than the Par Value of the Mortgage Loan.


 


“Maximum
Takeout Commitment Expiration Date”:  For an Undesignated Loan only, the “Maximum
Takeout Commitment Expiration Date” means the date that is ninety (90) days
after the Acquisition Date for such a Mortgage Loan.


 


3.             Seller’s
Repurchase Obligations. The following sentence is added to the end of
subsection 8.2(a) of the Agreement:


 


In the case of an Undesignated Loan, if Seller fails
to obtain a Takeout Commitment for such Mortgage Loan, or fails to provide to
MBF either a true and correct photocopy of it or information about it as
required by Section 13.18, within ninety (90) days after the Acquisition
Date, MBF may notify Seller, and Seller shall promptly repurchase such Mortgage
Loan at the Adjusted Acquisition Price on the date of repurchase.


 


4.             Additional
Seller’s Covenants. Section 13 of the Agreement is amended by the
addition of the following Section 13.18:


 


13.18       Takeout Commitment—Undesignated.
Seller shall make a commercially reasonable effort to obtain a Takeout
Commitment for each Undesignated Loan, and Seller shall provide to MBF a true
and correct photocopy of it or information about it (in such format and by such
media as MBF may from time to time determine) as soon as practicable after
Seller has obtained the Takeout Commitment. MBF acknowledges that a Takeout
Commitment for an Undesignated Loan may take the form of a bulk trade
commitment concerning a number of Undesignated Loans and certain other loans.


 


1

















 


Annex 8


 


Provisions Relating to
Aged Mortgage Loans


 


1.             Additional
Definitions. In addition to the definitions set forth in Section 1 of
the Agreement, the following definitions apply:


 


“Aged Mortgage Loan” means a Mortgage Loan (a) whose
Acquisition Price, when added to the Acquisition Prices of all Type 3
Nonconforming Loans and all other Aged Mortgage Loans then owned by MBF, does
not exceed the Type 3 NC/Aged Loan Sublimit; (b) whose Acquisition Price,
when added to the Acquisition Prices of all other Aged Mortgage Loans then
owned by MBF, does not exceed the Aged Mortgage Loan Sub-sublimit; (c) that
is approved for classification as an “Aged Mortgage Loan” by MBF in its sole
discretion; and (d) that was purchased either (1) subject to a valid
Takeout Commitment that has now expired, lapsed or is no longer in full force
and effect, or (2) without a Takeout Commitment, and Seller has failed to
repurchase the Mortgage Loan pursuant to subsection 8.2(a) by the
deadline established by the Annex applicable to that Mortgage Loan. A Mortgage
Loan that is classified as an “Aged Mortgage Loan” shall not be considered a “Defective
Mortgage Loan” so long as it has such classification.


 


“Aged Mortgage Loan Sub-sublimit” means
$2,000,000.00 at any one time.


 


“Type 3 NC/Aged Loan Sublimit” means
$2,000,000.00 at any one time.


 


2.             Modified or
Clarified Definitions. The following definitions set forth in Section 1
of the Agreement are modified as follows:


 


“Acquisition Price”:  For
any Mortgage Loan that becomes an Aged Mortgage Loan, the “Acquisition Price”
means the amount determined at the Acquisition Date according to other
provisions of the Agreement subject to reduction after the Acquisition Date pursuant
to Section 3.8.


 


“Event of Default”:  Clause (iii) of the definition of “Event
of Default” is amended to read:


 


(iii)          in any thirty (30) day period, MBF
requires Seller to repurchase Mortgage Loans (other than Mortgage Loans that
have become Aged Mortgage Loans) pursuant to Section 8 having an aggregate
Adjusted Acquisition Price in excess of $1 million; or


 


“Investment Return Rate”:  For an Aged Mortgage
Loan, the “Investment Return Rate” means the LIBOR Rate plus 275 basis points
(2.75%) for that period of days during which it is classified as an Aged
Mortgage Loan.


 


3.             Reduced
Acquisition Price; Refund. The following Section 3.8 is added to Section 3
of the Agreement:


 


 3.8          Recalculation of the Acquisition Price. If a
Mortgage Loan becomes an Aged Mortgage Loan, the Acquisition Price for the
Mortgage Loan


 


1

















 


shall be reduced, effective on the date of reduction,
by the following amounts according to the following schedule (unless MBF waives
in advance one or more of these mandatory reductions with respect to a
particular Mortgage Loan):


 


(a)           on the date that a
Mortgage Loan becomes an Aged Mortgage Loan, the amount necessary to reduce the
Acquisition Price for such Aged Mortgage Loan to an amount equal to ninety
percent (90%) of the Par Value of the Mortgage Loan;


 


(b)           on the date that is
thirty (30) days after the first reduction, the amount necessary to reduce the
Acquisition Price for such Aged Mortgage Loan to an amount equal to eighty
percent (80%) of the Par Value of the Mortgage Loan; and


 


(c)           on the date thirty
(30) days after the second reduction, the amount necessary to reduce the
Acquisition Price for such Aged Mortgage Loan to an amount equal to seventy
percent (70%) of the Par Value of the Mortgage Loan.


 


Seller shall pay to MBF each amount by which the
Acquisition Price is reduced hereunder, on the date of such reduction, as a
partial refund of the initial Acquisition Price, and MBF is authorized to
charge either or both of Seller’s Accounts in such amount unless the parties
have agreed in writing to a different method of payment. (In the event that
Seller’s Accounts do not contain sufficient funds to satisfy in whole any
amount due to MBF under this Section 3.8 or if the amount due are not
provided by any applicable alternative method of payment agreed by the parties,
Seller shall promptly deposit funds in Seller’s Funding Account sufficient to
satisfy such amount due to MBF, and Seller shall notify MBF of each such
deposit.)  On the date on which MBF has
owned a Mortgage Loan that has been an “Aged Mortgage Loan” for ninety (90)
days (measured from the date on which it was first classified as such), the
Mortgage Loan shall lose its classification as an “Aged Mortgage Loan,” become
a “Defective Mortgage Loan” and be repurchased by Seller pursuant to Section 8.2
without the necessity of a further notice from MBF that the Mortgage Loan has
become a Defective Mortgage Loan.


 


4.             Seller’s
Repurchase Obligations. The following sentence is added to the end of
subsection 8.2(a) of the Agreement:


 


Notwithstanding the foregoing, if the Mortgage Loan
has become an Aged Mortgage Loan, Seller shall have no obligation to repurchase
the Mortgage Loan under this subsection 8.2(a) as long as it is
classified as an Aged Mortgage Loan.


 


5.             Additional
Seller’s Covenants. Section 13.7 of this Agreement is modified by
redesignating subsection “(f)” as subsection “(g)” and by adding a new
subsection (f) to read in full as follows:


 


2

















 


(f)            With respect to an
Aged Mortgage Loan, if requested by MBF, a copy of the complete servicing file
relating to the Aged Mortgage Loan, an updated title opinion covering the
mortgaged property securing the Aged Mortgage Loan issued in form and substance
acceptable to MBF and issued by a title company acceptable to MBF, a current
appraisal or brokers price opinion certifying the current market value of the
mortgaged property securing the Aged Mortgage Loan in form and substance
acceptable to MBF, and such other information or documentation relating to the
borrower or Mortgaged Property of the Aged Mortgage Loan, all of the foregoing
to be provided as MBF in its discretion may request at any time or from time to
time, all at the sole cost and expense of Seller; and


 


Section 13 of the
Agreement is further amended by the addition of the following Section 13.19:


 


13.19       Replacement Takeout
Commitment—Aged. Seller shall make a commercially reasonable effort to
obtain a renewed or replacement Takeout Commitment for each Aged Mortgage Loan,
and Seller shall provide to MBF a true and correct photocopy of it or
information about it (in such format and by such media as MBF may from time to
time determine) as soon as practicable after Seller has obtained the Takeout
Commitment. MBF acknowledges that a Takeout Commitment for an Aged Mortgage
Loan may take the form of a bulk trade commitment concerning a number of Aged
Mortgage Loans and certain other loans.


 


3

















 


Exhibit A


 


Administrative Costs


 


All usual and customary
cost and expenses incurred by MBF in connection with processing, administering
and settling of a Mortgage Loan, currently including without limitation:


 


(a)           an internal
allocation for processing expense for each Mortgage Loan in the following
amounts (as applicable):


 


(i)                                     Mortgage
Loan purchased under Section 3.5 with a Dry Funding Documents Package or
under Section 3.6    with a Wet
Funding Documents Package:  $20.00; and


 


(ii)                                  Mortgage
Loan purchased requiring release of warehouse lender lien and interest held by


 


(x)                                   MBF:  $5.00; or


 


(y)                                 a
third party warehouse lender:  $20.00.


 


(b)                                 $0.00
internal allocation for processing files regarding a Mortgage Loan repurchased
early pursuant to Section 8.2 (unless the repurchase is financed by MBF as
Warehouse Lender);


 


(c)                                  a
monthly administration fee on the Monthly Unused Portion. This fee shall be
calculated each month at the rate of zero basis points (0.00%) per annum of the
Monthly Unused Portion for such month, payable in arrears on or before the
later of (a) the Remittance Date or (b) the date on which MBF
notifies Seller of the amount of the administration fee that has accrued since
the Effective Date or the last date of payment. The “Monthly Unused Portion”
means the amount equal to the Seller’s Concentration Limit minus the arithmetic daily average of the (i) Acquisition
Price of all Mortgage Loans previously purchased by MBF but not yet repurchased
by Seller as of such day plus (ii) if MBF is a Warehouse Lender to Seller,
the principal balance of all loans made by MBF to Seller in such capacity
outstanding on such day. MBF shall calculate the Monthly Unused Portion in its
sole discretion; and


 


(d)                                 messenger
and overnight courier fees.


 


A-1














 


Exhibit B


 


LOAN RECORD LAYOUT FOR
NEW LOANS – Jun ‘04


 


Required
Fields: W - Wires  C - Checks  CC – Cashiers Checks


O =
Optional Field


Blank =
Include field in format, leave data blank


 


	
  Excel
  Cell

  	
   

  	
  Field

  	
   

  	
  Type

  	
   

  	
  Req

  	
   

  	
  Description

  
	
  A

  	
   

  	
  Transaction Type

  	
   

  	
  (C-2)

  	
   

  	
  W,C,CC

  	
   

  	
  Transaction Type Code: 96 = New loan

  
	
  B

  	
   

  	
  Bank Code

  	
   

  	
  (C-5)

  	
   

  	
  W,C,CC

  	
   

  	
  Constant. Bank Code = BU

  
	
  C

  	
   

  	
  Customer Code

  	
   

  	
  (C-4)

  	
   

  	
  W,C,CC

  	
   

  	
  Constant. Will be assigned to you by us.

  
	
  D

  	
   

  	
  Line

  	
   

  	
  (C-4)

  	
   

  	
  W,C,CC

  	
   

  	
  Credit Line Codes will be assigned to you
  by us.

  
	
  E

  	
   

  	
  Sublimit

  	
   

  	
  (C-4)

  	
   

  	
  W,C,CC

  	
   

  	
  Sublimit Codes will be assigned to you by
  us.

  
	
  F

  	
   

  	
  Loan Number

  	
   

  	
  (C-20)

  	
   

  	
  W,C,CC

  	
   

  	
  Your loan identification number, right
  justified.

  
	
  G

  	
   

  	
  Alt Loan ID

  	
   

  	
  (C-13)

  	
   

  	
  W,C,CC

  	
   

  	
  Social Security Number.

  
	
  H

  	
   

  	
  Name

  	
   

  	
  (C-28)

  	
   

  	
  W,C,CC

  	
   

  	
  Primary Borrower Name (Last, First).

  
	
  I

  	
   

  	
  Address

  	
   

  	
  (C-35)

  	
   

  	
  W,C,CC

  	
   

  	
  Property Address.

  
	
  J

  	
   

  	
  City

  	
   

  	
  (C-15)

  	
   

  	
  W,C,CC

  	
   

  	
  City.

  
	
  K

  	
   

  	
  State

  	
   

  	
  (C-2)

  	
   

  	
  W,C,CC

  	
   

  	
  State abbreviation.

  
	
  L

  	
   

  	
  Zip

  	
   

  	
  (C-5)

  	
   

  	
  W,C,CC

  	
   

  	
  Zip Code.

  
	
  M

  	
   

  	
  County

  	
   

  	
  (C-15)

  	
   

  	
  W,C,CC

  	
   

  	
  Name of County.

  
	
  N

  	
   

  	
  Loan Amount

  	
   

  	
  (N-12-2)

  	
   

  	
  W,C,CC

  	
   

  	
  Original face amount of the Note.

  
	
  O

  	
   

  	
  Acquisition Cost

  	
   

  	
  (N-11-3)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  P

  	
   

  	
  Net Loan Amount

  	
   

  	
  (N-12-2)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  Q

  	
   

  	
  Warehouse Amt.

  	
   

  	
  (N-12-2)

  	
   

  	
  W,C,CC

  	
   

  	
  Requested warehouse amount.

  
	
  R

  	
   

  	
  Warehouse Date

  	
   

  	
  (C-8)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  S

  	
   

  	
  Advance Request

  	
   

  	
  (C-8)

  	
   

  	
   

  	
   

  	
  Leave Blank

  
	
  T

  	
   

  	
  Loan Term

  	
   

  	
  (N-4)

  	
   

  	
  W,C,CC

  	
   

  	
  Term to maturity of the underlying loan,
  expressed in months.

  
	
  U

  	
   

  	
  Interest Rate

  	
   

  	
  (N-6-3)

  	
   

  	
  W,C,CC

  	
   

  	
  Note Rate.

  
	
  V

  	
   

  	
  Mortgage Date

  	
   

  	
  (C-8)

  	
   

  	
  W,C,CC

  	
   

  	
  Date the loan closed. Date of the Note.

  
	
  W

  	
   

  	
  Loan Purpose

  	
   

  	
  (C-20)

  	
   

  	
  W,C,CC

  	
   

  	
  P = Purchase R = Refinance S = Second Mtg X
  = FHA/VA Streamline Refinance

  
	
  X

  	
   

  	
  Original LTV

  	
   

  	
  (N-6-2)

  	
   

  	
  W,C,CC

  	
   

  	
  Original Loan to Value, (Original Loan
  Amount / Original Sales Price or Appraised Value)

  



 


B-1

















 


	
  Excel
  Cell

  	
   

  	
  Field

  	
   

  	
  Type

  	
   

  	
  Req

  	
   

  	
  Description

  
	
  Y

  	
   

  	
  Original CLTV

  	
   

  	
  (N-6-2)

  	
   

  	
  W,C,CC

  	
   

  	
  Original Combined Loan to Value, (Original
  Loan Amount + Sr Lien Balance / Original Sales Price or Appraised Value)

  
	
  Z

  	
   

  	
  DTI Ratio

  	
   

  	
  (N-6-2)

  	
   

  	
  W,C,CC

  	
   

  	
  Debt to Income Ratio (Back-End Ratio)

  
	
  AA

  	
   

  	
  Sr. Lien Balance

  	
   

  	
  (N-12-2)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AB

  	
   

  	
  Asset Class

  	
   

  	
  (C-20)

  	
   

  	
  O

  	
   

  	
  Type of asset.

  
	
  AC

  	
   

  	
  Product

  	
   

  	
  (C-20

  	
   

  	
  W,C,CC

  	
   

  	
  Product Code. We will assign product codes.

  
	
  AD

  	
   

  	
  Lien Type

  	
   

  	
  (C-20)

  	
   

  	
  W,C,CC

  	
   

  	
  1=First 2=Second

  
	
  AE

  	
   

  	
  Balloon Flag

  	
   

  	
  (C-20)

  	
   

  	
  O

  	
   

  	
  If balloon, indicate with “Y”, otherwise
  “N”

  
	
  AF

  	
   

  	
  Property Type

  	
   

  	
  (C-20)

  	
   

  	
  W,C,CC

  	
   

  	
  1FAM = Single Family Residence

  2/4 = Two to Four Family Residences

  COND = Condominium

  TOWN = Townhome

  COOP = Cooperative

  MF = Multi-family

  CRE = Commercial Real Estate

  
	
  AG

  	
   

  	
  Occupancy Code

  	
   

  	
  (C-20)

  	
   

  	
  W,C,CC

  	
   

  	
  O = Owner Occupied, N = Non-owner Occupied

  
	
  AH

  	
   

  	
  Doc. Level

  	
   

  	
  (C-20)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AI

  	
   

  	
  Credit Grade

  	
   

  	
  (C-20)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AJ

  	
   

  	
  FICO Score

  	
   

  	
  (C-4)

  	
   

  	
  W,C,CC

  	
   

  	
  Fair Isaac Credit score (lowest of 2 or
  middle of 3 scores). Leave blank if property is MF or CRE.

  
	
  AK

  	
   

  	
  Units

  	
   

  	
  (C-1)

  	
   

  	
  O

  	
   

  	
  Number of Housing Units.

  
	
  AL

  	
   

  	
  MIN #

  	
   

  	
  (C-20)

  	
   

  	
  W,C,CC

  	
   

  	
  MERS / MIN number. Leave blank if property
  is MF or CRE.

  
	
  AM

  	
   

  	
  Custodian Code

  	
   

  	
  (C-20)

  	
   

  	
  .

  	
   

  	
  Leave Blank

  
	
  AN

  	
   

  	
  Investor Code

  	
   

  	
  (C-20)

  	
   

  	
  W,C,CC

  	
   

  	
  We will assign investor codes.

  
	
  AO

  	
   

  	
  Commitment

  	
   

  	
  (C-16)

  	
   

  	
  W,C,CC

  	
   

  	
  Investor takeout commitment number or if
  portfolio hedging place PH in the field.

  
	
  AP

  	
   

  	
  Price

  	
   

  	
  (N-10-6)

  	
   

  	
  W,C,CC

  	
   

  	
  Investor takeout price.

  
	
  AQ

  	
   

  	
  Expiration

  	
   

  	
  (C-8)

  	
   

  	
  W,C,CC

  	
   

  	
  Expiration date of the investor takeout
  commitment.

  
	
  AR

  	
   

  	
  ARM Index

  	
   

  	
  (C-20)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AS

  	
   

  	
  First ARM Floor

  	
   

  	
  (N-6-3)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AT

  	
   

  	
  Period ARM Floor

  	
   

  	
  (N-6-3)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AU

  	
   

  	
  Life ARM Floor

  	
   

  	
  (N-6-3)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AV

  	
   

  	
  First ARM Cap

  	
   

  	
  (N-6-3)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AW

  	
   

  	
  Period ARM Cap

  	
   

  	
  (N-6-3)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AX

  	
   

  	
  Life ARM Cap

  	
   

  	
  (N-6-3)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  



 


B-2

















 


	
  Excel
  Cell

  	
   

  	
  Field

  	
   

  	
  Type

  	
   

  	
  Req

  	
   

  	
  Description

  
	
  AY

  	
   

  	
  First Rate Change

  	
   

  	
  (C-8)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  AZ

  	
   

  	
  Rt Change Freq

  	
   

  	
  (N-3)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BA

  	
   

  	
  Next Rt Change

  	
   

  	
  (C-8)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BB

  	
   

  	
  Next Pmt Change

  	
   

  	
  (C-8)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BC

  	
   

  	
  Teaser Rate

  	
   

  	
  (N-6-3)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BD

  	
   

  	
  Monthly Payment

  	
   

  	
  (N-9-2)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BE

  	
   

  	
  P&I

  	
   

  	
  (N-9-2)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BF

  	
   

  	
  Amortization Type

  	
   

  	
  (C-20)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BG

  	
   

  	
  Wire Comments

  	
   

  	
  (C-35)

  	
   

  	
  W

  	
   

  	
  Additional comments in wire instructions.

  
	
  BH

  	
   

  	
  Payee Name

  	
   

  	
  (C-60)

  	
   

  	
  W, CC

  	
   

  	
  Name of the beneficiary of the funding
  proceeds.

  
	
  BI

  	
   

  	
  Payee Address

  	
   

  	
  (C-35)

  	
   

  	
  W, CC

  	
   

  	
  Address.

  
	
  BJ

  	
   

  	
  Payee City

  	
   

  	
  (C-15)

  	
   

  	
  W, CC

  	
   

  	
  City.

  
	
  BK

  	
   

  	
  Payee State

  	
   

  	
  (C-2)

  	
   

  	
  W, CC

  	
   

  	
  State abbreviation.

  
	
  BL

  	
   

  	
  Payee Zip

  	
   

  	
  (C-5)

  	
   

  	
  W, CC

  	
   

  	
  Zip Code.

  
	
  BM

  	
   

  	
  Payee Bank

  	
   

  	
  (C-12)

  	
   

  	
  W

  	
   

  	
  Receiver Bank for wires.

  
	
  BN

  	
   

  	
  Funding Type

  	
   

  	
  (C-2)

  	
   

  	
  W,C,CC

  	
   

  	
  01 = Outgoing Wire, 03 = Check, 04 =
  Cashiers Check

  
	
  BO

  	
   

  	
  Payee Account

  	
   

  	
  (C-60)

  	
   

  	
  W

  	
   

  	
  Beneficiary Account for wires.

  
	
  BP

  	
   

  	
  ABA Number

  	
   

  	
  (C-15)

  	
   

  	
  W

  	
   

  	
  Receiver Bank ABA number.

  
	
  BQ

  	
   

  	
  Draft Date

  	
   

  	
  (C-8)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BR

  	
   

  	
  Funding Amount

  	
   

  	
  (N-12-2)

  	
   

  	
  W,C,CC

  	
   

  	
  Amount of the wire or draft.

  
	
  BS

  	
   

  	
  Further Credit Bank

  	
   

  	
  (C-60)

  	
   

  	
  W

  	
   

  	
  Intermediary wire instructions to further
  credit a second bank.

  
	
  BT

  	
   

  	
  Further Credit Account

  	
   

  	
  (C-60)

  	
   

  	
  W

  	
   

  	
  Intermediary wire instructions to further
  credit a second bank.

  
	
  BU

  	
   

  	
  Advance Ref. #

  	
   

  	
  (C-12)

  	
   

  	
  C,CC

  	
   

  	
  Draft number if draft, blank if wire.

  
	
  BV

  	
   

  	
  Funding Eff Date

  	
   

  	
  (C-8)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BW

  	
   

  	
  Discount Method

  	
   

  	
  (C-1)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BX

  	
   

  	
  Fund Date

  	
   

  	
  (C-8)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BY

  	
   

  	
  Fund Ref

  	
   

  	
  (C-12)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  BZ

  	
   

  	
  Ship Date

  	
   

  	
  (C-8)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  CA

  	
   

  	
  Ship Method

  	
   

  	
  (C-1)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  CB

  	
   

  	
  Ship Ref.

  	
   

  	
  (C-12)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  CC

  	
   

  	
  Ship To

  	
   

  	
  (C-20)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  CD

  	
   

  	
  Ship Type

  	
   

  	
  (C-1)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  
	
  CE

  	
   

  	
  Note Rec’d Date

  	
   

  	
  (D-8)

  	
   

  	
   

  	
   

  	
  Leave Blank.

  



 


B-3

















 


Exhibit C


 


Loan Sale Confirmation


 


	
  Parties

  	
   

  	
  The parties to
  this Loan Sale Confirmation are the following:

  
	
   

  	
   

  	
   

  
	
  Seller:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Purchaser:

  	
   

  	
  Washington
  Mutual Bank

  
	
   

  	
   

  	
   

  
	
  Mortgage Loans

  	
   

  	
  THE MORTGAGE
  LOAN(S) COVERED BY THIS LOAN SALE CONFIRMATION ARE LISTED AND DESCRIBED
  IN THE ATTACHED SCHEDULE OF MORTGAGE LOAN(S).

  
	
   

  	
   

  	
   

  
	
  Sale:

  	
   

  	
  For value
  received, Seller hereby conveys to the Purchaser all rights, title and
  interest in and to the following

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a) The
  Mortgage Note and the related Mortgage for each Mortgage Loan; (b) all
  rights to payment thereunder; (c) all rights related thereto, such as
  financing statements, guaranties and insurance policies (issued by
  governmental agencies or otherwise), including (i) mortgage and title
  insurance policies, (ii) fire and extended coverage insurance policies
  (including the right, if any, to any return premiums), and (iii) if
  applicable, FHA insurance, VA guaranties, or private mortgage insurance and
  all rights, if any, in escrow deposits consisting of impounds, insurance
  premiums, or other funds held in account thereof; (d) all right, title
  and interest of the owner of such loan in the real property, including all
  improvements thereon, and the personal property (tangible and intangible)
  that are encumbered by such mortgage (or deed of trust) and/or security
  agreements; (e) all rights to service, administer and/or collect such
  loan and all rights to the payment of money on account of such servicing,
  administration and/or collection appraisals, computer programs, tapes, discs,
  cards, accounting records, and other books, records, information, and data
  relating to such loan necessary to the administration or servicing of such
  loan (subject to Seller’s right to service set forth in the Mortgage Loan
  Repurchase Agreement described below); and (f) all accounts, contract
  rights (including rights under any applicable Takeout Commitment), and general
  intangibles constituting or relating to such loan.

  



 


C-1

















 


	
   

  	
  Price

  	
   

  	
  The price paid
  for the above-described rights is described (as the “Acquisition Price”) in
  the attached Schedule of Mortgage Loans.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Seller hereby
  reaffirms the representations, warranties and covenants made in that certain
  Mortgage Loan Repurchase Agreement between Seller and Purchaser with respect
  to Seller on and as of the Effective Date stated therein and with respect to
  the sold Mortgage Loans on the Acquisition Date, and it hereby remakes all
  such representations, warranties and covenants on and as of the Acquisition
  Date.

  
	
   

  	
   

  	
   

  
	
   

  	
  Definitions

  	
   

  	
  Terms used but
  not defined herein shall have the meanings assigned to them in the above-referenced
  Mortgage Loan Repurchase Agreement.

  
	
   

  	
   

  	
   

  
	
   

  	
  NAME OF SELLER:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AUTHORIZED SIGNATURE:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  NAME AND TITLE:

  	
   

  	
   

  
					



 


C-2

















 


Schedule
to Exhibit C, Loan Sale Confirmation


 


SCHEDULE
OF MORTGAGE LOANS


 


	
  SELLER:

  
	
   

  
	
  DATE:

  



 


	
  Mortgage Loan

  Number

  	
   

  	
  Mortgagor Last

  Name

  	
   

  	
  Principal

  Amount

  	
   

  	
  Acquisition

  Price

  	
   

  	
  Takeout

  Investor

  	
   

  	
  Takeout

  Funding

  Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


THIS FORM NOT NECESSARY IF SELLER IS TRANSMITTING DATA
ELECTRONICALLY


 


C-3

















 


Exhibit D


 


Dry Funding
Documents Package


 


1.                                       If
a Mortgage Loan is the subject of a Takeout Commitment, a photocopy of Takeout
Commitment, or Takeout Commitment information in format acceptable to MBF.


 


2.                                       The
original Mortgage Note as signed and bearing all intervening endorsements,
endorsed “Pay to the order of                       
without recourse” and signed in the name of the last endorsee (the “Last
Endorsee”) by an authorized Person (in the event that the Mortgage Loan was
acquired by the Last Endorsee in a merger, the signature must be in the
following form:  “[Last Endorsee],
successor by merger to [name of predecessor]”; in the event that the Mortgage
Loan was acquired or originated by the Last Endorsee while doing business under
another name, the signature must be in the following form:  “[Last Endorsee], formerly known as [previous
name]”).


 


3.                                       Unless
such Mortgage Loan is a MERS Designated Mortgage Loan, an original Assignment
in Blank for the Mortgage Loan, in form and substance acceptable for recording
and signed in the name of the Last Endorsee by an authorized Person (in the
event that the Mortgage Loan was acquired by the Last Endorsee in a merger, the
signature must be in the following form: 
“[Last Endorsee], successor by merger to [name of predecessor]”; in the
event that the Mortgage Loan was acquired or originated by the Last Endorsee while
doing business under another name, the signature must be in the following
form:  “[Last Endorsee], formerly known
as [previous name]”). In the case of a MERS Designated Mortgage Loan that is
not a MOM Loan, original assignment(s) showing a complete chain of title
from the originator to MERS.


 


4.                                       An
original Warehouse Lender’s Release (if the Mortgage Loan is subject to a lien
held by a third party Warehouse Lender).


 


5.                                       Photocopy
of Mortgage as signed (with or without recording information on face of document
but in the case of a MERS Designated Mortgage Loan, with evidence of the MIN).


 


Wet Funding
Documents Package


 


1.                                       If
a Mortgage Loan is the subject of a Takeout Commitment, a photocopy of Takeout
Commitment, or Takeout Commitment information in format acceptable to MBF.


 


2.                                       Unless
such Mortgage Loan is a MERS Designated Mortgage Loan, a photocopy of
Assignment in Blank for the Mortgage Loan, in form and substance acceptable for
recording and signed in the name of the Last Endorsee by an authorized Person
(in the event that the Mortgage Loan was acquired by the Last Endorsee in a
merger, the signature must be in the following form:  “[Last Endorsee], successor by merger to
[name of predecessor]”; in the event that the Mortgage Loan was acquired or originated
by the Last Endorsee while doing business under another name, the signature
must be in the following form:  “[Last
Endorsee], formerly known as [previous name]”). In the case of a


 


D-1

















 


MERS Designated Mortgage
Loan that is not a MOM Loan, original assignment(s) showing a complete
chain of title from the originator to MERS.


 


3.                                       Photocopy
of Mortgage Note prepared for signature of Mortgagor.


 


4.                                       Photocopy
of Mortgage prepared for signature of Mortgagor (but in the case of a MERS
Designated Mortgage Loan, with evidence of the MIN).


 


5.                                       Closing
Agent’s Wire Instructions.


 


6.                                       Photocopy
of Escrow Instructions from MBF, acknowledged by Closing Agent.


 


D-2

















 


Exhibit E


 


Seller’s Power of
Attorney


 


LIMITED
POWER OF ATTORNEY


 


(“Seller”) has
entered into that certain Mortgage Loan Repurchase Agreement dated as of
                          ,
200    , as the same may be amended or supplemented from
time to time (the “Repurchase Agreement”), by and between Seller and WASHINGTON
MUTUAL BANK, a
federal association. All capitalized terms not defined herein shall have the
meanings given them in the Repurchase Agreement.


 


Seller hereby appoints
Washington Mutual Bank, a
federal association as special attorney-in-fact (“Attorney-in-Fact”) to supply
missing Mortgage Note endorsements and missing assignments of Mortgages, on an
as needed basis, with regard to Mortgage Loans sold to Washington Mutual Bank, a federal association pursuant to
the Repurchase Agreement.


 


Attorney-in-Fact accepts
such appointment and appoints the persons named on that certain Power of
Attorney dated as of
                          ,
of which a facsimile is attached hereto and incorporated herein by reference,
as same may be amended by Attorney-in-Fact from time to time, as its agents.


 


This Limited Power of
Attorney shall commence and be in full force and effect as of the date hereof
and shall remain and be in full force and effect until revoked in writing by
Attorney-in-Fact or revoked in writing by Seller, in a format acceptable to
Attorney-in-Fact, such as the form of Revocation of Limited Power of Attorney
attached hereto as Exhibit E-1, effective as of the date signed by
Attorney-in-Fact.


 


This Limited Power of
Attorney is coupled with the interest of Washington Mutual Bank, a federal
association, in each such Mortgage Loan as the purchaser and owner thereof
pursuant to the terms of the Repurchase Agreement.


 


Seller does hereby ratify
and confirm that the Attorney-in-Fact may exercise any power or authority
granted hereunder, irrespective of whether or not a default or an Event of
Default has occurred under the Repurchase Agreement. The rights and powers of
Attorney-in-Fact hereunder are cumulative of all other rights, remedies, and
recourse of Washington Mutual Bank, a federal association under the Repurchase Agreement.


 


Seller hereby covenants
and agrees that it will indemnify, defend, and hold harmless the
Attorney-in-Fact and its officers acting hereunder from and against any and all
claims, demands, or causes of action, in any way associated with or related to
the acts performed under this Limited Power of Attorney.


 


E-1

















 


IN WITNESS WHEREOF, this
instrument is executed by Seller on this
         day of
                            ,
200    .


 


	
   

  	
   

  	
  SELLER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [                                                                                                        ]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  STATE OF

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  COUNTY OF

  	
   

  	
   

  
						



 


This instrument
was acknowledged before me this      day of      ,
200    , by                                                                            on
      behalf             
of                                                         .




 


	
  [SEAL]

  	
   

  	
  Notary Public in and for the State of

  
	
   

  	
   

  	
   

  
	
  ACKNOWLEDGED
  BY

  	
   

  	
   

  
	
  ATTORNEY-IN-FACT:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  WASHINGTON
  MUTUAL BANK,

  	
   

  	
   

  
	
  a
  federal association

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
							



 


E-2

















 


Exhibit E-1


 


Revocation of Limited
Power of Attorney


 


[date]


 


WASHINGTON MUTUAL BANK

Attn: Carol A. Robertson

Legal Department

9200 Oakdale Avenue

Chatsworth, CA 91311

Phone: (818) 775-3392

Fax: (818) 349-2734


 


Reference is made herein
to that Limited Power of Attorney granted by                                                               (“Seller”)
to WASHINGTON MUTUAL BANK, a federal association (“Attorney-in-Fact”) dated as
of
                  ,
200    .


 


This document
acknowledges and constitutes that Seller hereby revokes, rescinds, and
terminates said Limited Power of Attorney and all authority, rights, and power
thereto, effective this date. Grantor hereby reaffirms and agrees that it will
indemnify, defend, and hold harmless the Attorney-in-Fact and its officers
acting under said Limited Power of Attorney from and against any and all
claims, demands, or causes of action, in any way associated with or related to
the acts performed under the Limited Power of Attorney. This Revocation of
Limited Power of Attorney is effective as of the date signed by
Attorney-in-Fact.


 


Signed under seal as of
the date above written:


 


	
   

  	
   

  	
  [                                                                      ]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
						



 


E-1-1

















 


STATE OF


 


COUNTY OF


 


This instrument
was acknowledged before me this        day of
                          ,
200    , by
                                                  ,
                                                        
on behalf of                                                                                                   .


 


 


	
  [SEAL]

  	
   

  	
  Notary Public in and
  for the State of

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ACKNOWLEDGED BY

  
	
   

  	
   

  	
  ATTORNEY-IN-FACT:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WASHINGTON MUTUAL BANK,

  
	
   

  	
   

  	
  a federal association

  



 


	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
						



 


E-1-2

















 


Exhibit F


 


Warehouse Lender’s
Release


 


Ladies and Gentlemen:


 


We hereby release all
right, interest or claim of any kind with respect to the mortgage
loan(s) referenced below, such release to be effective automatically
without any further action by any part, upon receipt of payment/funding, in one
or more installments, from Washington Mutual Bank, a federal association, in accordance
with the wire instructions which we delivered to you in a letter dated
                              ,
200    , in immediately available funds.


 


	
  Loan #

  	
   

  	
  Mortgagor

  	
   

  	
  Note Amount

  	
   

  	
  Warehouse Amount

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


 


	
   

  	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [WAREHOUSE LENDER]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
						



 


F-1














 


Exhibit G


 


Guaranty


 


THIS GUARANTY (this “Guaranty”) dated as of                                 ,
200    , is made by                                                
(“Guarantor”) in favor of WASHINGTON MUTUAL BANK, a federal association, a federal
association (“Washington Mutual”).


 


WITNESSETH


 


WHEREAS, Washington Mutual has completed or may
hereafter complete certain transactions with                                 
(“Seller”) pursuant to the terms of a Mortgage Loan Repurchase Agreement of
even date herewith (the “Repurchase Agreement”);


 


WHEREAS, Washington Mutual may have completed, or may
hereafter complete, certain secured loans to Seller pursuant to one or more
warehouse line of credit agreements (collectively, the “Loan Agreement”);


 


WHEREAS, the Guarantor will derive substantial
benefits from the completion of such transactions with Seller and such loans to
Seller;


 


AGREEMENT


 


NOW, THEREFORE, (i) to induce MBF, at any time
from time to time, to complete such transactions, (ii) at the special insistence
and request of MBF, and (iii) for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, Guarantor hereby
agrees as follows:


 


1.             Guarantor hereby absolutely and unconditionally
guarantees the prompt and punctual payment and performance when due (whether at
its maturity, by lapse of time, by acceleration or otherwise) of the Guaranteed
Obligations (hereinafter defined).  This
is a specific guaranty applicable to and guaranteeing any and all amounts
(including interest accrued subsequent to the filing of any petition under any
bankruptcy, insolvency or similar law) owing or which hereafter become owing to
MBF under the Repurchase Agreement or the Loan Agreement, or in connection with
any Mortgage Loan sold and purchased under the Purchase Agreement or pledged
under the Loan Agreement, together with all renewals, extensions, increases,
replacements, and rearrangements thereof, including all present and future
amounts that would become due but for the operation of §502 or §506 or any
other provision of Title 11 of the United States Code (hereinafter called
the “Guaranteed Obligations”).


 


2.             Guarantor hereby waives marshalling of assets and
liabilities, sale in inverse order of alienation, notice of acceptance of this
Guaranty and of any indebtedness, obligation or liability to which it applies
or may apply, and waives presentment and demand for payment thereof, notice of
dishonor or nonpayment thereof, notice of intention to accelerate, notice of
acceleration, protest, and notice thereof and all other notices and demands,
collection or instigation of suit or any other action by MBF in collection
thereof, including any notice of default in payment thereof or other notice to,
or demand of payment therefor on, any party other than demand on Guarantor for
payment under this Guaranty.  Further,
Guarantor expressly 


 


G-1

















 


waives each and every right to which it may be
entitled by virtue of the suretyship law of the State of Texas including
without limitation, any rights it may have pursuant to Rule 31, Texas Rules of
Civil Procedure, V.T.C.A., Civil Practice and Remedies Code §17.001 and
Chapter 34 of the Texas Business and Commerce Code.


 


3.             Guarantor agrees to pay to MBF its collection costs,
including reasonable attorneys’ fees, but in no event to exceed the maximum
amount permitted by law, if the Guaranteed Obligations are not paid by
Guarantor upon demand when due as required herein or if this Guaranty is
enforced by suit or through probate or bankruptcy court or through any judicial
proceedings whatsoever, and should it be necessary to reduce MBF’s claim to
judgment, such judgment shall bear interest at the rate of 10% per annum or
such greater maximum rate, if any, allowed by applicable laws.


 


4.             This is an absolute and unconditional guaranty of
payment and not of collection, by Guarantor, jointly and severally with any
other guarantor of the Guaranteed Obligations in each and every particular, and
Guarantor waives any right to require that (a) any action be brought
against Seller or any other person or entity, (b) MBF enforce its rights
against any other guarantor of the Guaranteed Obligations, (c) MBF proceed
or enforce its rights against or exhaust any security given to secure the
Guaranteed Obligations, (d) MBF has Seller joined with Guarantor or any
other guarantor of all or part of the Guaranteed Obligations in any suit
arising out of this Guaranty and/or the Guaranteed Obligations, or (e) MBF
pursue any other remedy in MBF’s powers whatsoever.  MBF shall not be required to mitigate damages
or take any action to reduce, collect or enforce the Guaranteed
Obligations.  Guarantor waives any
defense arising by reason of any disability, lack of corporate authority or
power, or other defense of Seller or any other guarantor of the Guaranteed
Obligations, and shall remain liable hereon regardless of whether Seller or any
other guarantor be found not liable thereon for any reason other than payment
in full of the Obligations, subject to Paragraph 7 of this Guaranty.  Should MBF seek to enforce the obligations of
Guarantor by action in any court, Guarantor waives any necessity, substantive
or procedural, that a judgment previously be rendered against Seller or any
other person or entity or that Seller or any other person or entity be joined
in such cause or that a separate action be brought against Seller or any other
person or entity.  The obligations of
Guarantor hereunder are several from those of Seller or any other person or entity
(including without limitation any other surety for Seller), and are primary
obligations concerning which Guarantor is the principal obligor.  All waivers herein contained shall be without
prejudice to MBF at its option to proceed against Seller or any other person or
entity, whether by separate action or by joinder.  The payment by Guarantor of any amount
pursuant to this Guaranty shall not in anywise entitle Guarantor to any right,
title or interest (whether by way of subrogation or otherwise) in and to any of
the Guaranteed Obligations or any proceeds thereof, or any security therefor,
unless and until the full amount owing to MBF on the Guaranteed Obligations has
been fully paid, but when the same has been fully paid Guarantor shall be
subrogated as to any payments made by the Guarantor to the rights of MBF as
against Seller and/or any endorsers, sureties or other guarantors.


 


5.             Guarantor agrees that suit may be brought against
Guarantor and any other guarantors of the Guaranteed Obligations, jointly and
severally, and against one or more of them, less than all, without impairing
the rights of MBF, its successors or assigns, against the other guarantors; nor
shall MBF be required to join Seller or any other guarantor or liable party in
a 


 


G-2

















 


suit against a particular guarantor; and MBF may
release Seller and/or one or more guarantor(s) or settle with such persons
or entities as MBF deems fit without releasing or impairing the rights of MBF
to demand and collect the balance of such indebtedness from the other remaining
guarantors not so released.


 


6.             Guarantor hereby consents and agrees to each of the
following to the fullest extent permitted by law, and agrees that the Guarantor’s
obligations under this Guaranty shall not be released, diminished, impaired,
reduced or adversely affected by any of the following, and waives any rights
(including without limitation rights to notice) which Guarantor might otherwise
have as a result of or in connection with any of the following:


 


(a)           Any renewal,
extension, modification, increase, decrease, alteration or rearrangement of all
or any part of the Guaranteed Obligations or the Repurchase Agreement, the Loan
Agreement or any other contract or understanding between Seller and MBF, or any
other person or entity, pertaining to the Guaranteed Obligations;


 


(b)           Any adjustment,
indulgence, forbearance or compromise that might be granted or given by MBF to
Seller or Guarantor or any person or entity liable on the Guaranteed
Obligations;


 


(c)           The insolvency,
bankruptcy arrangement, adjustment, composition, liquidation, disability,
dissolution, death or lack of power of Seller or Guarantor or any other person
or entity at any time liable for the payment of all or part of the Guaranteed
Obligations; or any dissolution of Seller or Guarantor, or any sale, lease or
transfer of any or all of the assets of Seller or Guarantor, or any changes in
the shareholders, partners, or members of Seller or Guarantor; or any
reorganization of Seller or Guarantor;


 


(d)           The invalidity,
illegality or unenforceability of all or any part of the Guaranteed Obligations
or the Repurchase Agreement, the Loan Agreement or any other document or
agreement executed in connection with the Guaranteed Obligations, for any
reason whatsoever, including without limitation the fact that the Guaranteed
Obligations, or any part thereof, exceed the amount permitted by law, the act
of creating the Guaranteed Obligations or any part thereof is ultra vires, the
officers or representatives executing the documents or otherwise creating the
Guaranteed Obligations acted in excess of their authority, the Guaranteed
Obligations violate applicable usury laws, Seller has valid defenses, claims or
offsets (whether at law, in equity or by agreement) which render the Guaranteed
Obligations wholly or partially uncollectible from Seller, the creation,
performance or repayment of the Guaranteed Obligations (or the execution,
delivery and performance of any document or instrument representing part of the
Guaranteed Obligations or executed in connection with the Guaranteed
Obligations, or given to secure the repayment of the Guaranteed Obligations) is
illegal, uncollectible, legally impossible or unenforceable, or the documents
or instruments pertaining to the Guaranteed Obligations have been forged or
otherwise are irregular or not genuine or authentic;


 


(e)           Any full or partial
release of the liability of Seller on the Guaranteed Obligations or any part
thereof, of any co-guarantors, or any other person or entity now 


 


G-3

















 


or hereafter
liable, whether directly or indirectly, jointly, severally, or jointly and
severally, to pay, perform, guarantee or assure the payment of the Guaranteed
Obligations or any part thereof, it being recognized, acknowledged and agreed
by Guarantor that Guarantor may be required to pay the Guaranteed Obligations
in full without assistance or support of any other person or entity, and
Guarantor has not been induced to enter into this Guaranty on the basis of a
contemplation, belief, understanding or agreement that other parties other than
Seller will be liable to perform the Guaranteed Obligations, or MBF will look
to other parties to perform the Guaranteed Obligations;


 


(f)            The taking or
accepting of any other security, collateral or guaranty, or other assurance of
payment, for all or any part of the Guaranteed Obligations;


 


(g)           Any release,
surrender, exchange, subordination, deterioration, waste, loss or impairment of
any collateral, property or security, at any time existing in connection with,
or assuring or securing payment of, all or any part of the Guaranteed
Obligations;


 


(h)           The failure of MBF
or any other person or entity to exercise diligence or reasonable care in the
preservation, protection, enforcement, sale or other handling or treatment of
all or any part of such collateral, property or security;


 


(i)            The fact that any
collateral, security, security interest or lien contemplated or intended to be
given, created or granted as security for the repayment of the Guaranteed
Obligations shall not be properly perfected or created, or shall prove to be
unenforceable or subordinate to any other security interest or lien, it being
recognized and agreed by Guarantor that Guarantor is not entering into this
Guaranty in reliance on, or in contemplation of the benefits of, the validity,
enforceability, collectability or value of any of the collateral for the
Guaranteed Obligations;


 


(j)            Any payment by
Seller to MBF is held to constitute a preference under the bankruptcy laws, or
for any reason MBF is required to refund such payment or pay such amount to
Seller or someone else;


 


(k)           Any other action
taken or omitted to be taken with respect to the Guaranteed Obligations, or the
security and collateral therefor, whether or not such action or omission
prejudices Guarantor or increases the likelihood that Guarantor will be
required to pay the Guaranteed Obligations pursuant to the terms hereof; it
being the unambiguous and unequivocal intention of Guarantor that Guarantor
shall be obligated to pay the Guaranteed Obligations when due, notwithstanding
any occurrence, circumstance, event, action, or omission whatsoever, whether
contemplated or uncontemplated, and whether or not otherwise or particularly
described herein, except for the full and final payment and satisfaction of the
Guaranteed Obligations; or


 


(l)            The fact that all
or any of the Guaranteed Obligations cease to exist by operation of law,
including without limitation by way of a discharge, limitation or tolling
thereof under applicable bankruptcy laws.


 


7.                                       In
the event any payment by Seller or any other guarantor of all or part of the
Guaranteed Obligations to MBF is held to be a preference under the bankruptcy
laws, or if for 


 


G-4

















 


any other reason MBF is required to refund such
payment or pay the amount thereof to any other party, such payment by Seller or
by such guarantor to MBF shall not constitute a release of Guarantor from any
liability respecting payment of the Guaranteed Obligations, and Guarantor
agrees to pay such amount to MBF upon demand.


 


8.             It is the intention of the parties hereto to comply with
applicable usury laws; accordingly, it is agreed that notwithstanding any
provision to the contrary in the Guaranteed Obligations or in this Guaranty, in
any note or other instrument, or in any documents securing payment thereof or
hereof, or otherwise relating thereto or hereto, no such provision shall
require the payment or permit the collection of interest in excess of the
maximum permitted by such laws.  If any
excess of interest in such respect is provided for, or shall be adjudged to be
so provided for, then in such event (a) the provisions of this paragraph shall
govern and control, (b) neither Guarantor nor Guarantor’s heirs,
successors, or assigns or any other party liable for the payment hereof shall
be obligated to pay the amount of such interest to the extent that it is the
excess of the maximum amount permitted by such laws, (c) any such excess
which may have been collected shall be, at MBF’s option, either applied as a
credit against the then unpaid principal amount owing on the Guaranteed
Obligations, or refunded, and (d) the effective rate of interest covered
by this Guaranty shall be automatically subject to reduction to the maximum
lawful rate allowed under applicable usury laws.


 


9.             This Guaranty is for the benefit of MBF, and for such
other persons and entities as may from time to time become or be the holders of
any Guaranteed Obligations; and this Guaranty shall be transferable and
negotiable, with the same force and effect and to the same extent as the
Guaranteed Obligations may be transferable, it being understood that upon the
assignment or transfer by MBF of any Guaranteed Obligations, the legal holder
of such Guaranteed Obligations shall have all of the rights granted to MBF
under this Guaranty.


 


10.           Payment of all amounts hereunder
shall be made at the offices of MBF.


 


11.           The term “Other Indebtedness” as used
herein means all indebtedness, if any, of Seller to MBF other than the
Guaranteed Obligations.  If, at any time,
there is Other Indebtedness, (a) MBF, without in any manner impairing its
rights hereunder, may at its option, but subject to the requirements of the
Repurchase Agreement or the Loan Agreement which shall prevail in the case of
any conflict between the Repurchase Agreement or the Loan Agreement and this
Guaranty, exercise rights of offset by applying any deposit balances to the credit
of Seller, first, to the Other Indebtedness, and the balance, if any, to the
Guaranteed Obligations, and (b) except as stated in the last sentence of
this paragraph, MBF may apply all amounts realized by MBF from collateral or
security held by MBF of the payment of Seller’s indebtedness, first, to the
Other Indebtedness and the balance, if any, to the Guaranteed Obligations.  If a particular security instrument expressly
requires an application different from that permitted under the preceding
sentence, proceeds realized by MBF from such security instrument shall be
applied as provided in such instrument.


 


12.           Any notice, request or other
communication required or permitted to be given hereunder shall be given in
writing by delivering the same against receipt therefor or by depositing the
same in the United States Postal Service, postage prepaid, registered or
certified mail, return receipt requested, addressed to the respective parties
at the address shown below or 


 


G-5

















 


to such other address as the intended recipient may
have specified in a prior written notice received by the sender (and if so
given, shall be deemed given when mailed).


 


13.           This Guaranty shall not be wholly or
partially satisfied or extinguished by Guarantor’s partial payment of any
amount due on the Guaranteed Obligations, but shall continue in full force and
effect as against Guarantor for the full amount of the Guaranteed Obligations
until payment in full thereof.


 


14.           This Guaranty shall be binding upon
Guarantor, its successors and assigns and shall inure to the benefit of, and be
enforceable by MBF and its successors and assigns and each and every other
person who shall from time to time be or become the owner or holder of any of the
Guaranteed Obligations.


 


15.           The release by MBF of Seller or one
or more other guarantors of all or part of the Guaranteed Obligations shall not
affect the Guarantor, who shall remain fully liable in accordance with the
terms of this Guaranty.


 


16.           This Guaranty, whether continuing,
specific, and/or limited, shall be in addition to and cumulative of, and not in
substitution, novation or discharge of, any and all prior or contemporaneous
guaranty agreements by Guarantor or other persons or entities, in favor of MBF
or assigned to MBF by others.  This
Guaranty is in addition to and not in substitution, replacement or
extinguishment of any other prior guaranties of the Guarantor covering the
Guaranteed Obligations.


 


17.           Guarantor represents and warrants
that (i) this Guaranty is not given with actual intent to hinder, delay or
defraud any entity to which Guarantor is or will become, on or after the date
hereof, indebted; (ii) Guarantor is not engaged in a business or
transaction, nor is about to engage in a business or transaction, for which any
property remaining with Guarantor constitutes an unreasonably small amount of
capital; or (iii) Guarantor does not intend to incur debts that will be
beyond the Guarantor’s ability to pay as such debts mature.


 


18.           This Guaranty shall be governed by
and construed and interpreted in accordance with the laws of the United States
of America and the State of Texas.


 


19.           Guarantor hereby represents and
warrants to MBF as follows:


 


(a)           Financial
Statements.  Any financial statements
and data which have heretofore been given to MBF with respect to the Guarantor
fairly present in all material respects the financial condition of the
Guarantor as of the date thereof, and, since the date thereof, there has been
no material adverse change in the financial condition of the Guarantor.  Guarantor shall promptly deliver to MBF, or
Seller in time for Seller to deliver the same to MBF, all financial statements
of the Guarantor required to be delivered to MBF pursuant to the Repurchase
Agreement.


 


(b)           Address.  The address of the Guarantor as specified
below is true and correct and until MBF shall have actually received a written
notice specifying a change of address and specifically requesting that notices
be issued to such changed address, MBF may rely on the address stated as being
accurate.


 


G-6

















 


20.           No delay on the part of MBF in
exercising any right hereunder or failure to exercise the same shall operate as
a waiver of such right, nor shall any single or partial exercise of any right,
power or privilege bar any further or subsequent exercise of the same or any
other right, power or privilege.


 


21.           This Guaranty shall not be changed
orally, but shall be changed only by agreement in writing signed by the person
against whom enforcement of such change is sought.


 


22.           The masculine and neuter genders used
herein shall each include the masculine, feminine and neuter genders and the
singular number used herein shall include the plural number.  The words “person” and “entity” shall include
without limitation individuals, corporations, partnerships, joint ventures,
associations, joint stock companies, trusts, unincorporated organizations, and
governments and any agency or political subdivision thereof.


 


23.           If any provision of this Guaranty is
determined to be invalid by any court of competent jurisdiction or to be in
violation of any applicable law, such invalidity or violation shall have no
effect on any other provisions of this Guaranty (which shall remain valid and
binding and in full force and effect) or in any other jurisdiction, and to that
end the provisions of this Guaranty shall be considered severable.


 


24.           If this Guaranty is given by a
corporation, then the undersigned guaranteeing corporation does hereby
acknowledge that it has investigated fully the benefits and advantages which
will be derived by the undersigned from execution of this Guaranty, and the
Board of Directors of the undersigned corporation has decided that, and the
undersigned corporation does hereby acknowledge, warrant and represent that, a
direct or an indirect benefit will accrue to the undersigned by reason of
execution of this Guaranty.


 


25.           Guarantor hereby expressly waives any
right to a trial by jury in any action or legal proceeding arising out of or
relating to this Guaranty or the Repurchase Agreement or the Loan Agreement for
the transactions contemplated hereby or thereby.


 


26.           All terms used herein that are not
defined in this Guaranty shall have the meanings assigned to them in the
Repurchase Agreement or the Loan Agreement.


 


27.           With
respect to any and all disputes arising hereunder, the Guarantor hereby
irrevocably and unconditionally:


 


(a)           Submits for himself and his property in any legal
action or proceeding relating to this Guaranty or for recognition and
enforcement of any judgment in respect of any thereof, to the non-exclusive
general jurisdiction of the courts of the State of Texas, the courts of the
United States of America for the Southern District of Texas, and appellate
courts from any thereof;


 


(b)           Consents that any such action or proceeding may be
brought in such courts, and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;


 


G-7

















 


(c)           Agrees that service of process in any such action or
proceeding may be effected by mailing a photocopy thereof by first class
registered or certified mail (or any substantially similar form and mail),
postage prepaid, to it at its address specified on the signature page hereof;


 


(d)           Agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction; and


 


(e)           Agrees that this Guaranty represents the final, entire
agreement among the parties hereto and supersedes any and all prior
commitments, agreements, representations and understandings, whether written or
oral, relating to the subject matter hereof and thereof and may not be
contradicted or varied by evidence of prior, contemporaneous or subsequent oral
agreements or discussions of the parties hereto.  There are no unwritten oral agreements among
the parties hereto.


 


[Signature
page follows]


 


G-8

















 


GUARANTOR:


 


	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
					



 


	
  STATE OF                                 

  	
  )

  
	
   

  	
  ) ss

  
	
  COUNTY OF                             

  	
  )

  



 


This instrument was acknowledged before me on this       
day of                           ,
200    , by                                                                                                                               .


 


	
   

  	
   

  
	
  NOTARY PUBLIC, STATE OF              

  



 


 


[SEAL]


 


G-9

















 


Exhibit H


 


Compliance Certificate


 


	
  SELLER:

  	
  SIRVA
  MORTGAGE, INC., an Ohio corporation f/k/a

  Cooperative Mortgage Services, Inc.

  
	
  MBF:

  	
  WASHINGTON MUTUAL BANK,

  a federal association

  
	
  TODAY’S DATE:

  	
          /        /20
          

  
	
  REPORTING PERIOD ENDED:

  	
          /        /                

  



 


This certificate is delivered to MBF pursuant to the
Mortgage Loan Repurchase Agreement dated as of May 27, 2005 between Seller
and MBF (the “Agreement”).  All the
defined terms of the Agreement have the same meanings when used herein.


 


I hereby certify that: 
(a) I am, and at all times mentioned herein have been, the duly
elected, qualified, and acting officer of Seller designated below; (b) to
the best of my knowledge, the financial statements of Seller from the period
shown about (the “Reporting Period”) and which accompany this certificate were
prepared in accordance with GAAP and present fairly the financial condition of
Seller as of the end of the Reporting Period and the results of its operations
for Reporting Period; (c) a review of the Agreement and of the activities
of Seller during the Reporting Period has been made under my supervision with a
view to determining Seller’s compliance with the covenants, requirements,
terms, and conditions of the Agreement, and such review has not disclosed the
existence during or at the end of the Reporting Period (and I have no knowledge
of the existence as of the date hereof) of any Default or Event of Default,
except as disclosed herein (which specifies the nature a d period of existence
of each Default or Event of Default, if any, and what action Seller has taken,
is taking, and proposes to take with respect to each); and (d) the
calculations described herein evidence that Seller is in compliance with the
requirements of Sections 13.11, 13.12 and 13.13 of the Agreement at the end of
the Reporting Period (or if Seller is not in compliance, showing the extent of non-compliance
and specifying the period of non-compliance and what actions Seller proposes to
take with respect thereto).


 


	
  [NAME
  OF SELLER]

  
	
  By:

  	
   

  
	
  Name:

  	
   

  



Title:


	
  SELLER:

  	
  [NAME OF SELLER]

  
	
  REPORTING PERIOD ENDED:

  	
          /        /                

  



 


All financial calculations set forth herein are as of
the end of the Reporting Period.


 


H-1

















 


I.                                         ADJUSTED
TANGIBLE NET WORTH


 


	
  The Tangible Net
  Worth of Seller is:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Shareholder’s
  Equity:

  	
   

  	
  $

  	
   

  
	
  Minus: Intangible
  Assets:

  	
   

  	
  $

  	
   

  
	
  Minus: Advances
  of loans to Affiliates:

  	
   

  	
  $

  	
   

  
	
  Minus:
  Investments in Affiliates:

  	
   

  	
  $

  	
   

  
	
  Minus: Assets
  pledged to secure liabilities not included in Debt:

  	
   

  	
  $

  	
   

  
	
  Minus: Any other
  Agency nonacceptable assets:

  	
   

  	
  $

  	
   

  
	
  TANGIBLE NET
  WORTH:

  	
   

  	
  $

  	
   

  
	
  The Adjusted
  Tangible Net Worth of Seller is:

  	
   

  	
   

  	
   

  
	
  Tangible Net
  Worth (from above):

  	
   

  	
  $

  	
   

  
	
  Plus:
  Subordinated Debt:

  	
   

  	
  $

  	
   

  
	
  Plus: 1.00%
  times unpaid principal balance of Mortgage Loans for which Seller owns the
  servicing rights:

  	
   

  	
  $

  	
   

  
	
  ADJUSTED
  TANGIBLE NET WORTH:

  	
   

  	
  $

  	
   

  
	
  REQUIRED
  MINIMUM

  	
   

  	
  $

  	
  6,500,000.00

  	
   

  
	
  In
  compliance?

  	
   

  	
  [Yes or No]

  	
   

  
					



 


II.                                     DEBT OF SELLER


 


	
  Total
  Liabilities

  	
   

  	
  $

  	
   

  
	
  Minus: Loan loss
  reserves:

  	
   

  	
  $

  	
   

  
	
  Minus: Deferred
  taxes arising from capitalized excess servicing fees, operating leases and
  Subordinated Debt:

  	
   

  	
  $

  	
   

  
	
  DEBT:

  	
   

  	
  $

  	
   

  



 


III.                                 DEBT TO ADJUSTED
TANGIBLE NET WORTH


 


	
  Debt (from
  above):

  	
   

  	
  $

  	
   

  
	
  Adjusted
  Tangible Net Worth (from above)

  	
   

  	
  $

  	
   

  
	
  RATIO
  OF DEBT TO ADJUSTED TANGIBLE NET WORTH:

  	
   

  	
      :1

  	
   

  
	
  MAXIMUM
  PERMITTED

  	
   

  	
  17:1, 6/1/05-9/30/05;

  15:1 thereafter

  	
   

  
	
  In
  compliance?

  	
   

  	
  [Yes or No]

  	
   

  



 


H-2

















 


IV.                                CURRENT RATIO


 


	
  Current Assets
  (assets that are now cash or will be by their terms or disposition be to cash
  within one year of the date of calculation)

  	
   

  	
  $

  	
   

  
	
  Current
  Liabilities (liabilities due upon demand or within one year from the date of
  calculation)

  	
   

  	
  $

  	
   

  
	
  RATIO
  OF CURRENT ASSETS TO CURRENT LIABILITIES

  	
   

  	
      :1

  	
   

  
	
  Minimum
  Required

  	
   

  	
  1.05:1

  	
   

  
	
  In
  compliance?

  	
   

  	
  [yes or no]

  	
   

  



 


V.                                    THIRD PARTY REPORTS


 


All reports received from third parties (such as the
SEC, FNMA, GNMA, FHLMC) subsequent to the last reporting period are attached
hereto. These reports include the following (if none, write “None”):


 


VI.                                DEFAULTS OR EVENTS OF
DEFAULT


 


Disclose nature and period of existence
and action being taken in connection therewith; if none, write  “None”:


 


H-3

















 


Exhibit I


 


Takeout Investors

(effective as of                 ,
200    )


 


[to be provided]


 


I-1

















 


Exhibit J


 


Electronic Tracking
Agreement


 


J-1














 


Exhibit K


 


Bailee Letter


 


[date]


 


[Investor name and address]


 


Ladies and Gentlemen:


 


Pursuant to the terms and conditions set forth below,
we hereby deliver to you, with this letter, an original promissory note (a “Mortgage
Note”) evidencing each mortgage loan (a “Mortgage Loan”) listed on the attached
schedule, to facilitate your purchase of such Mortgage Loan. Each Mortgage Loan
is owned by Washington Mutual Bank, a federal association (the “Bank”) as successor in interest to
[Company Name] (the “Seller”), pursuant to that certain Mortgage Loan
Repurchase Agreement dated [date], as the same may be amended, modified,
extended, or renewed from time to time.


 


By taking physical possession of this letter and each
Mortgage Note delivered hereunder, you hereby agree to the following terms and
conditions:


 


1.                                       You
will hold the Mortgage Note(s) and all related Mortgage Loan files in
trust as custodian, agent, and bailee, solely on behalf of the Bank, until your
status as bailee is terminated as set forth below.  You agree not to release or deliver the
Mortgage Note(s) or any other Mortgage Loan document(s) to any party
except the Bank, without Bank’s prior written consent.  You will not take any action that may
jeopardize the ownership interest of the Bank in the Mortgage Note(s) and
related Mortgage Loan.


 


2.                                       You
acknowledge your commitment to purchase the Mortgage Loans and to pay the
takeout purchase proceeds for such Mortgage Loans specified on the attached
schedule.  You acknowledge that, until
there is a completed sale to you pursuant to the commitment, the Bank (or, if
it is first resold to the Seller, then the Seller) is the exclusive owner of
all right, title and interest in the Mortgage Loan, the related Mortgage Note
and Mortgage Loan documents, and the related Mortgage Loan files.


 


3.                                       You
are responsible for making certain that all of the takeout purchase proceeds
are paid in accordance with the wire transfer instructions in this Bailee
Letter, and you shall have no right, title or interest, legal or equitable, in
a Mortgage Loan, the Mortgage Note and related Mortgage Loan documents, or the
related Mortgage Loan files, until the identified recipient receives the
takeout purchase proceeds.  Upon receipt
of the full amount of takeout purchase proceeds, by wire transfer as specified
below, the Bank’s ownership interest in the Mortgage Loan shall be fully
released and your responsibilities as bailee shall terminate.


 


4.                                       The
Bank reserves the right at any time, until a Mortgage Loan has been purchased
by you and the takeout purchase proceeds have been received by the identified
recipient, to demand immediate return of the Mortgage Note, and you agree to
return the Mortgage Note immediately upon such demand.


 


1

















 


5.            Within 30 days of the date of this letter, you will
either:


 


	
   

  	
  Wire
  the purchase funds to:

  	
   

  	
  Washington
  Mutual Bank, Coppell TX

  
	
   

  	
  ABA:

  	
   

  	
  111-993-776

  
	
   

  	
  Account
  Name:

  	
   

  	
  [Company
  Name] Funding Account

  
	
   

  	
  Account
  Number:

  	
   

  	
  [Funding
  Account Number]

  
	
   

  	
  Reference:

  	
   

  	
  [Mortgagor
  Last Name or Loan Number]

  
	
   

  	
   

  	
   

  	
   

  



-or-



Return the Mortgage Note to Theri Dufour, Washington Mutual Bank, National
Operations Center, 555 Dividend Drive, Suite 150, 3545BFTX, Coppell, Texas
75019, phone 800/543-1601.


 


6.             You shall not honor
any further communication from the Bank regarding any Mortgage Loan, while
still owned by the Bank, unless it comes from (or is confirmed in writing or in
a telephone conversation by) the person signing this Bailee Letter or by any of
the following persons:  Leslie J.
Collard, Eva L. Torres, Jacquelyn M. West.


 


7.             You agree to pay,
indemnify, and hold the Bank and Bank’s officers, directors, employees,
counsel, agents and attorneys-in-fact (each, an “Indemnified Person”) harmless
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suites, costs, charges, expenses or
disbursements (including reasonable attorney’s fees and the allocated cost of
in-house counsel) of any kind or nature whatsoever incurred with respect to any
investigation, litigation or proceeding (including any case, action or
proceeding before any court or other governmental authority relating to
bankruptcy, reorganization, insolvency, liquidation, dissolution or relief of
debtors or any appellate proceeding) (collectively, the “Proceedings”) arising
from your noncompliance with the terms of this Bailee Letter, whether or not
you are a party to the related Proceedings.


 


8.             If for any reason you
are not able to comply with the terms of this Bailee Letter, you are directed
to immediately return each Mortgage Note delivered hereunder, and any other
documents or records previously received by you from the Bank with respect to
the Mortgage Note(s) or the Mortgage Loan evidenced thereby, to the
address set forth in paragraph 5 above.


 


Sincerely,



WASHINGTON MUTUAL BANK, a federal association






	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					



 


2

















 


Directory of Defined
Terms


 


	
  “1NC1 Loan”

  	
  Annex
  4

  
	
  “1NC1 Sub-sublimit”

  	
  Annex
  4

  
	
  “1NC2 Loan”

  	
  Annex
  5

  
	
  “1NC2 Sub- sublimit”

  	
  Annex
  5

  
	
  “1NC3 Loan”

  	
  Annex
  6

  
	
  “1NC3 Sub-sublimit”

  	
  Annex
  6

  
	
  “2NC1 Loan”

  	
  Annex
  4

  
	
  “2NC1 Sub-sublimit”

  	
  Annex
  4

  
	
  “2NC2 Loan”

  	
  Annex
  5

  
	
  “2NC2 Sub-sublimit”

  	
  Annex
  5

  
	
  “2NC3 Loan”

  	
  Annex
  6

  
	
  “2NC3 Sub-sublimit”

  	
  Annex
  6

  
	
   

  	
   

  
	
  “Acquisition Date”

  	
  Section 1

  
	
  “Acquisition Price”

  	
  Section 1, Annex 1; Annex 3; Annex 4; Annex 5; 

  Annex 6; Annex 7; Annex 8

  
	
  “Act of Insolvency”

  	
  Section 1

  
	
  “Adjusted Tangible Net
  Worth”

  	
  Section 1

  
	
  “Administrative Costs”

  	
  Section 1

  
	
  “Affiliate”

  	
  Section 1

  
	
  “Aged Mortgage Loan”

  	
  Annex
  8

  
	
  “Aged Mortgage Loan
  Sub-sublimit”

  	
  Annex
  8

  
	
  “Agencies”

  	
  Section 1

  
	
  “Agency Guidelines”

  	
  Section 1

  
	
  “Agreement”

  	
  Section 1

  
	
  “Annual Reporting Date”

  	
  Annex
  1

  
	
  “AOT Commitment”

  	
  Annex
  3

  
	
  “Assignment in Blank”

  	
  Section 1

  
	
   

  	
   

  
	
  “Bailee Letter”

  	
  Section 1

  
	
  “Business Day”

  	
  Section 1

  
	
   

  	
   

  
	
  “Capitalized
  Lease”

  	
  Section 1

  
	
  “Capitalized Rentals”

  	
  Section 1

  
	
  “CL”

  	
  Section 1

  
	
  “CL Commitment”

  	
  Annex
  3

  
	
  “CL Funding”

  	
  Annex
  3

  
	
  “CL Funding Advice”

  	
  Annex
  3

  
	
  “CL Funding Date”

  	
  Annex
  3

  
	
  “CL Program”

  	
  Section 1

  
	
  “Compliance Certificate”

  	
  Section 1

  
	
  “Confidential
  Information”

  	
  Section 1

  
	
  “Credit File”

  	
  Section 1; Annex 3

  
	
  “Current Assets”

  	
  Section 1

  
	
  “Current Liabilities”

  	
  Section 1

  



 


1

















 


	
  “Current Ratio”

  	
  Section 1

  
	
  “Custodial Account”

  	
  Section 1

  
	
   

  	
   

  
	
  “Debt”

  	
  Section 1

  
	
  “Default”

  	
  Section 1

  
	
  “Default Rate”

  	
  Section 1

  
	
  “Defective
  Mortgage Loan”

  	
  Section 1

  
	
  “Dry Funding Documents
  Package”

  	
  Section 1

  
	
   

  	
   

  
	
  “Early
  Repurchase Date”

  	
  Section 1

  
	
  “Effective Date”

  	
  Section 1

  
	
  “Electronic Tracking
  Agreement”

  	
  Section 1

  
	
  “Eligible Bank”

  	
  Section 1

  
	
  “ERISA”

  	
  Section 1

  
	
  “Event of Default”

  	
  Section 1, Annex 8

  
	
   

  	
   

  
	
  “FDIC”

  	
  Section 1

  
	
  “FHA”

  	
  Section 1

  
	
  “FHLMC”

  	
  Section 1

  
	
  “FNMA”

  	
  Section 1

  
	
   

  	
   

  
	
  “GAAP”

  	
  Section 1

  
	
  “GLB Act”

  	
  Section 1

  
	
  “GNMA”

  	
  Section 1

  
	
  “Guarantor”

  	
  Annex
  1

  
	
  “Guaranty”

  	
  Section 1

  
	
   

  	
   

  
	
  “Hedging Arrangement”

  	
  Section 1

  
	
   

  	
   

  
	
  “Indebtedness”

  	
  Section 1

  
	
  “Interim Date”

  	
  Annex
  1

  
	
  “Investment Return
  Rate”

  	
  Section 1, Annex 1; Annex 3; Annex 4; Annex 5; Annex 6; Annex
  8

  
	
   

  	
   

  
	
  “LIBOR Rate”

  	
  Section 1

  
	
  “Lien”

  	
  Section 1

  
	
  “Litigation”

  	
  Section 1

  
	
  “Loan Purchase
  Detail”

  	
  Section 1

  
	
  “Loan Sale
  Confirmation”

  	
  Section 1

  
	
   

  	
   

  
	
  “Margin Stock”

  	
  Section 1

  
	
  “Market Value”

  	
  Section 1

  
	
  “Material Adverse
  Change”

  	
  Section 1

  
	
  “Maximum Takeout
  Commitment Expiration Date”

  	
  Annex
  1; Annex 4; Annex 5; Annex 6; Annex 7

  
	
  “MBF”

  	
  Section 1

  
	
  “MERS”

  	
  Section 1

  
	
  “MERS Designated
  Mortgage Loan”

  	
  Section 1

  



 


2

















 


	
  “MERS® System”

  	
  Section 1

  
	
  “MIN”

  	
  Section 1

  
	
  “MOM Loan”

  	
  Section 1

  
	
  “Monthly Available
  Deposits”

  	
  Annex
  1

  
	
  “Monthly Reporting Date”

  	
  Annex
  1

  
	
  “Mortgage”

  	
  Section 1

  
	
  “Mortgage Loan”

  	
  Section 1

  
	
  “Mortgage Note”

  	
  Section 1

  
	
  “Mortgage Note Rate”

  	
  Section 1

  
	
  “Mortgaged
  Property”

  	
  Section 1

  
	
  “Mortgagor”

  	
  Section 1

  
	
   

  	
   

  
	
  “NASD”

  	
  Section 1

  
	
   

  	
   

  
	
  “Option ARM
  Loan”

  	
  Annex
  3

  
	
  “OTS”

  	
  Section 1

  
	
   

  	
   

  
	
  “Par Value”

  	
  Section 1

  
	
  “Pass-Through Rate”

  	
  Section 1

  
	
  “Permitted Dividend”

  	
  Annex
  1

  
	
  “Person”

  	
  Section 1

  
	
  “Post-Origination
  Period”

  	
  Section 1

  
	
  “Property Charges”

  	
  Section 1

  
	
   

  	
   

  
	
  “Regulatory Authority”

  	
  Section 1

  
	
  “Remittance Date”

  	
  Section 1

  
	
  “Repurchase Date”

  	
  Section 1

  
	
  “Repurchase
  Price”

  	
  Section 1

  
	
  “Requirement of Law”

  	
  Section 1

  
	
   

  	
   

  
	
  “Scheduled
  Repurchase Date”

  	
  Section 1; Annex 1; Annex 3

  
	
  “SEC”

  	
  Section 1

  
	
  “Seller”

  	
  Section 1

  
	
  “Seller Guide”

  	
  Section 1

  
	
  “Seller’s Account”

  	
  Section 1

  
	
  “Seller’s Concentration
  Limit”

  	
  Annex
  1

  
	
  “Seller’s Funding
  Account”

  	
  Section 1

  
	
  “Seller’s Operating
  Account”

  	
  Section 1

  
	
  “Seller’s Power of
  Attorney”

  	
  Section 1

  
	
  “Servicing Fee”

  	
  Section 1

  
	
  “Settlement Amount”

  	
  Section 1

  
	
  “Shipping Instructions”

  	
  Section 1

  
	
  “Statement Date”

  	
  Section 1

  
	
  “Subordinated Debt”

  	
  Section 1

  
	
  “Subsidiary”

  	
  Section 1

  
	
  “Successor
  Servicer”

  	
  Section 1

  
	
  “Successor Servicer
  Costs”

  	
  Section 1

  



 


3

















 


	
  “Takeout
  Commitment”

  	
  Section 1; Annex 3

  
	
  “Takeout Funding”

  	
  Section 1; Annex 3

  
	
  “Takeout Funding Advice”

  	
  Section 1; Annex 3

  
	
  “Takeout Funding Date”

  	
  Section 1

  
	
  “Takeout Guidelines”

  	
  Section 1; Annex 3

  
	
  “Takeout Investor”

  	
  Section 1; Annex 3

  
	
  “Tangible Net Worth”

  	
  Section 1

  
	
  “Term”

  	
  Section 1

  
	
  “Type 1 Nonconforming
  Loan”

  	
  Annex
  4

  
	
  “Type 1 Nonconforming
  Loan Sublimit”

  	
  Annex
  4

  
	
  “Type 2 Nonconforming
  Loan”

  	
  Annex
  5

  
	
  “Type 2 Nonconforming
  Loan Sublimit”

  	
  Annex
  5

  
	
  “Type 3 NC/Aged
  Loan Sublimit”

  	
  Annex
  6

  
	
  “Type 3 Nonconforming
  Loan”

  	
  Annex
  6

  
	
   

  	
   

  
	
  “UCC”

  	
  Section 1

  
	
  “Undesignated Loan”

  	
  Annex
  7

  
	
   

  	
   

  
	
  “VA”

  	
  Section 1

  
	
   

  	
   

  
	
  “Warehouse
  Lender”

  	
  Section 1

  
	
  “Warehouse Lender’s
  Release”

  	
  Section 1

  
	
  “Warehouse Lender’s
  Wire Instructions”

  	
  Section 1

  
	
  “Washington Mutual”

  	
  Section 1

  
	
  “Wet Funding”

  	
  Section 1

  
	
  “Wet Funding Deadline”

  	
  Annex
  1

  
	
  “Wet Funding
  Documents Package”

  	
  Section 1

  
	
  “Wet Funding Sublimit”

  	
  Annex
  1

  



 


4

















 


FLEXIBLE EARLY PURCHASE FACILITY

(Repo Contract)


 


MORTGAGE LOAN REPURCHASE AGREEMENT

by and between

WASHINGTON MUTUAL BANK,
a federal association

and


 


SIRVA MORTGAGE, INC., an Ohio
corporation 

f/k/a Cooperative Mortgage Services, Inc.


 


dated as of May 27, 2005


 

















 


Table of Contents


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
  Definitions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
  Purchase and Sale

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  Purchase Procedures

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.1

  	
  Initial Conditions Precedent

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.2

  	
  Conditions Precedent

  	
   

  	
  14

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.3

  	
  Deliverables

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.4

  	
  Assignment of Takeout Commitment

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.5

  	
  Dry Funding Closing

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.6

  	
  Wet Funding Closing

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.7

  	
  Post-Closing

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  Warehouse Lender Arrangements

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  Servicing of Mortgage Loans and
  Related Provisions

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1

  	
  Servicing of Mortgage Loans

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2

  	
  Custodial Account

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  Seller’s Continuing Duties

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.1

  	
  Takeout Commitments

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.2

  	
  Administrative and Successor Servicer
  Costs

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
  Repurchase Procedures

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.1

  	
  Note Shipment

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.2

  	
  Takeout Funding Advice

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.3

  	
  Repurchase Closing

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.4

  	
  Definitive Repurchase Price and
  Servicing Fee

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.5

  	
  Use of Custodial Account Funds

  	
   

  	
  22

  



 


i

















 


	
  8.

  	
  Early Repurchase; Other Remedies

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.1

  	
  Sale Not Caveat Emptor

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.2

  	
  Early Repurchases

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.3

  	
  Other Remedies

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
  True Sales of Mortgage Loans

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.1

  	
  True Sales

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.2

  	
  Precautionary Security Interest

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
  Seller Representations

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
  Representations and Warranties
  Concerning Mortgage Loans

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
  Representations and Warranties
  Concerning Seller

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.1

  	
  Organization and Good Standing

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.2

  	
  Authority and Capacity

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.3

  	
  No Conflict

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.4

  	
  Performance

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.5

  	
  Ordinary Course Transaction

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.6

  	
  Litigation; Compliance with Laws

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.7

  	
  Statements Made

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.8

  	
  Approved Company

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.9

  	
  Fidelity Bonds

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.10

  	
  Solvency

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.11

  	
  Reporting

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.12

  	
  Financial Condition

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.13

  	
  Regulation U

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.14

  	
  Investment Company Act

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.15

  	
  Agreements

  	
   

  	
  29

  



 


ii

















 


	
   

  	
  12.16

  	
  Title to Properties

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.17

  	
  ERISA

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.18

  	
  Proper Names

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.19

  	
  No Undisclosed Liabilities

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.20

  	
  Tax Returns and Payments

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.21

  	
  Subsidiaries

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.22

  	
  Holding Company

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.23

  	
  Credit Information

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.24

  	
  No Discrimination

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.25

  	
  Home Ownership and Equity
  Protection Act

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.26

  	
  CL Program

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
  Seller’s Covenants

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.1

  	
  Maintenance of Existence; Conduct
  of Business

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.2

  	
  Compliance with Applicable Laws

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.3

  	
  Inspection of Properties and Books

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.4

  	
  Notices

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.5

  	
  Payment of Debt, Taxes, etc

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.6

  	
  Insurance

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.7

  	
  Financial Statements and Other
  Reports

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.8

  	
  Limits on Corporate Distributions

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.9

  	
  Use of Washington Mutual’s Name

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.10

  	
  Reporting

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.11

  	
  Debt to Adjusted Tangible Net Worth
  Ratio

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.12

  	
  Minimum Adjusted Tangible Net Worth

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.13

  	
  Minimum Current Ratio

  	
   

  	
  34

  



 


iii

















 


	
   

  	
  13.14

  	
  Hedging Arrangements

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14.

  	
  Term

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15.

  	
  Notices; Service

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  15.1

  	
  Notices

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  15.2

  	
  Service

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.

  	
  Fees and Expenses; Indemnity

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  16.1

  	
  Fees and Expenses

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  16.2

  	
  Indemnity

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17.

  	
  Confidential Information

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.1

  	
  Restrictions on Use of Confidential
  Information

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.2

  	
  Controls on Confidential Information

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.3

  	
  Audits

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.4

  	
  Confidential Information Not
  Subject to Restrictions

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.5

  	
  Required Disclosures

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.6

  	
  Continued Restrictions

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.7

  	
  Injunctive Relief Permitted

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  18.

  	
  Modifications, Consents and
  Waivers; Entire Agreement

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  19.

  	
  Remedies Cumulative

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  20.

  	
  Counterparts

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  21.

  	
  Governing Law

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  22.

  	
  Severability

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  23.

  	
  Binding Effect; Assignment or
  Delegation

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  24.

  	
  Annexes, Exhibits and Riders

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  25.

  	
  Time of the Essence

  	
   

  	
  38

  



 


iv

















 


	
  Annex 1

  	
   

  	
  Customized Terms

  
	
  Annex 2

  	
   

  	
  Representations and
  Warranties Concerning Mortgage Loans

  
	
  Annex 3

  	
   

  	
  Mortgage Loans Subject
  to CL Commitments

  
	
  Annex 4

  	
   

  	
  Provisions Relating to
  Type 1 Nonconforming Loans

  
	
  Annex 5

  	
   

  	
  Provisions Relating to
  Type 2 Nonconforming Loans

  
	
  Annex 6

  	
   

  	
  Provisions Relating to
  Type 3 Nonconforming Loans

  
	
  Annex 7

  	
   

  	
  Provisions Relating to
  Undesignated Loans

  
	
  Annex 8

  	
   

  	
  Provisions Relating to
  Aged Mortgage Loans

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
   

  	
  Administrative Costs

  
	
  Exhibit B

  	
   

  	
  Loan Purchase Detail

  
	
  Exhibit C

  	
   

  	
  Loan Sale Confirmation

  
	
  Exhibit D

  	
   

  	
  Dry Funding Documents
  Package/Wet Funding Documents Package

  
	
  Exhibit E

  	
   

  	
  Seller’s Power of
  Attorney

  
	
  Exhibit F

  	
   

  	
  Warehouse Lender’s Release

  
	
  Exhibit G

  	
   

  	
  Guaranty

  
	
  Exhibit H

  	
   

  	
  Compliance Certificate

  
	
  Exhibit I

  	
   

  	
  Takeout Investors

  
	
  Exhibit J

  	
   

  	
  Electronic Tracking
  Agreement

  
	
  Exhibit K

  	
   

  	
  Bailee Letter

  



 


Directory of Defined
Terms


 


v