exv10w8






Exhibit 10.8




EXECUTION




AMENDED AND RESTATED MASTER SERVICE AGREEMENT




     Amended and Restated Master Service Agreement, dated as of March 29, 2010 and effective as of
January 1, 2010 (the “Agreement”) between Aurora Bank FSB (as successor to Atlantic Bank and Trust
Company, the “Servicer”) and Capital Crossing Preferred Corporation (as successor to Atlantic
Preferred Capital Corporation, the “Customer”). As of the date hereof, this Agreement amends and
restates in its entirety that certain Master Services Agreement dated as of March 31, 1998 by and
between the Servicer and the Customer (the “Existing MSA”).



     WHEREAS, the Customer currently owns and may from time to time acquire ownership to certain
residential and commercial mortgage loans and real estate owned properties;



     WHEREAS, the Customer and the Servicer have previously contracted for certain servicing
responsibilities (the “Services” or individually a “Service”) associated with the assets currently
owned by the Customer and the Servicer is performing the Services with respect to such assets,
including, but not limited to, the following: (1) data processing services as described in
Exhibit A annexed hereto, including the preparation of reports and other back office
operations support services as necessary to provide said data processing services, (2) loan
servicing for all mortgage loans held by the Customer as described in Exhibit B annexed
hereto; and (3) nonperforming loan services and foreclosure services as described in Exhibit
C annexed hereto; and



     WHEREAS, the Customer and the Servicer desire to (i) amend and restate in their entirety the
terms and a conditions upon which the Servicer currently performs the Services and (ii) set forth
the terms and conditions on which the Servicer will perform the Services from and after the date
hereof.



     NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions set forth
herein, the parties hereto agree as follows:



     1. The Servicer shall provide the services described in Exhibits A through C
annexed hereto for the Customer at the rates set forth in Exhibit D annexed hereto.



     2. Notwithstanding anything to the contrary set forth herein, the Servicer may employ vendors
and subservicers (each, a “Subservicer”) to carry out its obligations under this Agreement upon
obtaining the approval of a majority of the board of directors of the Customer, including a
majority of the members of the board who are not either (i) current officers or employees of the
Customer or (ii) current officers, directors or employees of the Servicer or any affiliate of the
Servicer; provided, that the use by the Servicer of any such vendor or Subservicer shall not
release the Servicer from any of its obligations hereunder and the Servicer shall remain
responsible hereunder for all acts and omissions of such vendors and Subservicers as fully as if
such acts and omissions were those of the Servicer. Except as set forth in this Agreement, the
Servicer shall pay all fees and expenses of its third party vendors or Subservicers from its own
funds. Each agreement between the Servicer and a Subservicer that obligates the Subservicer to
perform the primary servicing responsibilities with respect to any mortgage loan subject hereto
shall hereinafter be referred to as a “Subservicing Agreement”. The Customer hereby represents



 









 




and warrants to the Servicer that a majority of the board of directors of the Customer, including a
majority of the members of the board who are not either (i) current officers or employees of the
Customer or (ii) current officers, directors or employees of the Servicer or any affiliate of the
Servicer, has approved, effective as of October 1, 2009, the Servicer’s engagement of certain
subservicers separately identified by the Customer and the Servicer as initial subservicers
hereunder and the Servicer’s engagement of a certain subcontractor separately identified by the
Customer and the Servicer to perform certain administrative obligations of the Servicer hereunder.




     3. Unless otherwise terminated pursuant to the terms hereof, this Agreement shall terminate
upon (a) the later of (i) the distribution of the final payment or liquidation proceeds on the last
mortgage loan subject hereto to the Customer and (ii) the disposition of all REO property subject
hereto and the remittance of all funds due hereunder or (b) mutual consent of the Servicer and the
Customer in writing.



     4. The Servicer shall revise Exhibit D to modify the rates set forth on Exhibit
D from time to time during the Term to reflect changes in the actual costs incurred or
estimated costs to be incurred by the Servicer in providing the Services to the Customer. Such
revised Exhibit D shall be substituted for the Exhibit D then in effect and shall
become effective upon the date set forth in such a revised Exhibit D.



     5. (a) The Customer represents that Exhibits A through C contain a general
description of the Services to be provided by the Servicer to the Customer. In performing these
services, the scope of the work undertaken and the manner of its performance shall be substantially
the same as for similar work performed by the Servicer for transactions on its own behalf, with
such modifications as may be appropriate in order to accomplish the purposes of this Agreement.
The Servicer shall give the Customer reasonable notice of all system changes affecting the
Customer’s procedures or reports as these changes pertain to the Services.



          (b) The Servicer reserves the right to alter the contents of reports, eliminate reports, add
reports or change the frequency of delivery of reports described in Exhibits A through
C.




          (c) If the changes referred to in paragraph (a) or (b) above are not acceptable to the
Customer, the Customer may terminate this Agreement on the greater of (i) thirty (30) days’ written
notice and (ii) the number of days’ written notice equal to the sum of five (5) Business Days (as
defined below) plus the number of days notice upon which the Servicer is permitted to terminate
each related Subservicing Agreement without cause, provided any such notice is given within
ten (10) days after the Customer has received notice of such change.




     6. (a) The Customer shall furnish all data, records and materials in the manner, at the place
and within the time limits determined by the Servicer to be necessary to perform the Services. The
Customer shall prepare all data submitted for processing with reasonable care and in a manner
acceptable to the Servicer.



          (b) The Customer hereby agrees that the costs incurred by the Servicer because data, records
or materials sent by or for the Customer are not in the form required by this Agreement or are not
received by the Servicer in accordance with the time schedule established






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to permit the Servicer to meet its required delivery schedule are the responsibility of the
Customer.




          (c) The Servicer shall not be responsible for errors resulting from any incorrect data
submitted for processing by the Customer. The Servicer may, however, make minor corrections of the
data if the original source documents are in error or make other minor adjustments, without charge,
unless the volume of such items becomes unreasonable in the judgment of the Servicer, at which time
the Servicer may notify the Customer of its intention to impose charges for such additional work at
its then prevailing rates.




     7. It is understood and agreed that the performance of the Services is or might be subject to
regulation and examination by authorized representatives of the federal or state bank regulatory
agencies, and that each party is and shall be authorized to submit or furnish to any such
regulatory agency reports, information, assurances and other data as may be required by, or
reasonably requested of it, under applicable laws and regulations, including, without limitation,
any appropriate notifications concerning the initiation or termination of this Agreement or any of
the Services provided to the Customer. Each party shall afford the other party or any examiners or
authorized representatives of federal or state bank regulatory agencies or either parties’
independent auditors or legal counsel access to loan documentation or any other data governed by
this Agreement.



     8. The Servicer shall, with appropriate charge, promptly make any and all modifications to
forms, documents and reporting methods as may be required to comply with any statutory, regulatory,
or administrative rules or other legal requirements. The Servicer, subject to Customer providing
reasonable notice as established by Servicer, shall make and implement any modification to forms,
documents and reporting methods required in response to such statutory, regulatory, or
administrative rules or other legal requirements by such time as the modifications may be necessary
as required by law.



     9. The Servicer shall, no later than the twenty-fifth (25th) calendar day of each calendar
month, remit to the Customer all payments (other than escrow payments) received by the Servicer
during the immediately preceding calendar month with respect to the mortgage loans subject hereto,
net of all service fees due under this Agreement and all expenses to which the Servicer is entitled
to reimbursement under this Agreement. The rates set forth in Exhibit D are exclusive of
all taxes, however designated, imposed on any amount payable hereunder for the Servicer or their
provision to the Customer. Any sales and use taxes, however designated, and if applicable, shall
be the responsibility of and shall be paid by the Customer.



     10. In performing the Services, the Servicer shall be deemed to have an independent
contractual relationship with the Customer. It is agreed that the Servicer and the Customer are
not partners or joint venturers and that the Servicer is not to act as agent for the Customer but
is to act as an independent contractor. The Servicer shall not be deemed to have any contractual
or other relationship with the Customer’s customers. In no event shall any of the Customer’s
customers be considered a third party beneficiary of this Agreement. To the extent that third
parties may make claims against the Servicer arising out of the Services, the Customer agrees to
indemnify and hold harmless the Servicer from and against all loss, liability, claim, action,
demand or suits, including any claims for attorneys’ fees arising therefrom, except as otherwise
provided here.



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     11. All programs, whether standard Servicer programs or programs developed specifically for
the Customer, files and documentation, are and shall remain the property of the Servicer, unless
otherwise specified in this Agreement. Upon termination of the Services, the Servicer will make
available to the Customer all data contained in all master files and transaction files then
available relevant to the Services. Any expense incurred by the Servicer in providing such
information shall be paid for by the Customer at the Servicer’s then prevailing rates.



     12. Each party shall indemnify and hold the other party harmless against any loss, damages,
penalties fines forfeitures, reasonable legal fees and related costs, judgments, and other
reasonable costs and expenses resulting from any claims, demand defense or assertion to the extent
resulting from a breach of the covenants, representations and warranties contained in this
Agreement. Upon receipt of notice of any such claims, demand, defense or assertion, the party
seeking indemnification shall promptly give written notice thereof to the other party. The parties
agree to cooperation in defense or prosecution of any claim, demand, defense or assertion, based on
or grounded upon, or resulting form, a breach of the covenants, representations and warranties
contained in this Agreement.



     13. EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED HEREIN, THE SERVICER MAKES NO WARRANTIES OR
REPRESENTATIONS AS TO THE SERVICES, EXPRESS OR IMPLIED, IN FACT OR IN LAW, INCLUDING BUT NOT
LIMITED TO WARRANTIES OF MERCHANT ABILITY OR FITNESS FOR A PARTICULAR PURPOSE.



     14. The liability of the Servicer to the Customer for any loss due to the Servicer’s
performing, or failing to perform, the Services shall be contingent upon the Customer’s compliance
with its obligations herein and shall be limited to those losses sustained by the Customer which
are a direct result of the Servicer’s negligence or willful misconduct; provided,
however, that the Servicer’s only liability to the Customer arising from any interruptions
in, or delay or unavailability of, the Services or any errors or omissions in the Services or any
loss of data, shall be to restore any Service which is interrupted or is delayed or becomes
unavailable, as promptly as reasonably practicable and, in the case of any error or omission in a
Service or loss of data, to correct such error or omission or regenerate any lost data;
provided, further, that the Servicer shall not be obligated hereunder to correct
any error or omission in the Services if it would not ordinarily correct such error or omission.



     15. The Servicer shall not be responsible or liable for its failure to delay in performance or
the Services when such failure or delay arises out of, results from, or is caused by any act or
omission of the Customer or by any event beyond the control of the Servicer, as provided in
Section 19 of this Agreement.



     16. Notwithstanding anything contained herein to the contrary, the aggregate amounts of any
money damages to which the Customer and any and all other parties claiming by, through or under the
Customer, may be entitled as the result of any claims against the Servicer (regardless of whether
such claims are based on contract, tort (including negligence and strict liability, warranty or
other legal or equitable grounds) shall be limited to an amount equal to the lesser of (a) the
actual amount of such losses, damages, injuries, claims, costs or expenses or (b) an aggregate
annual amount payable by the Customer to the Servicer for the Service affected, as stated on
Exhibit D.



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     17. The Servicer shall not incur any liability or obligation under this Agreement by reason of
any loss or damages to the Customer caused by an error or omission by the Servicer unless the
Customer shall have informed the Servicer of such error or omission within two (2) Business Days
after the discovery thereof. The Customer agrees to use diligent efforts to reconstruct any lost
data, records or materials, and if appropriate, to charge back to the Customer’s accounts and the
forwarding banks’ accounts, and to obtain funds from its depositors’ forwarding banks and
endorsers’ banks. If the Servicer carries insurance against the type of loss incurred, the
Customer agrees to cooperate in furnishing proof of loss in a form satisfactory to the Servicer’s
insurance company and to assist the Servicer and its insurance company in settlement of the claim.
For purposes of this Agreement, “Business Day” shall mean any day other than (i) a Saturday or
Sunday, or (ii) a day on which banking and savings and loan institutions in the States of New York,
Colorado or California are authorized or obligated by law or executive order to be closed.



     18. In the event of any material breach of party’s obligations under this Agreement (an “Event
of Default”), the other party shall provide a written notice of such Event of Default and a demand
that such Event of Default be cured. In the event the breaching party fails in a good faith to
cure such Event of Default within ten (10) days following receipt of such notice and demand (or, in
the case of an Event of Default by the Servicer, within the greater of (i) ten (10) days notice
following receipt of such notice and demand and (ii) the number of days’ notice equal to the sum of
two (2) Business Days plus the number of days notice following receipt of such notice and demand
upon which the Servicer is permitted to terminate each related Subservicing Agreement in such
instance), the non-defaulting party may terminate this Agreement and/or take legal action to obtain
specific performance, injunctive and other equitable relief as well as any other remedies as may be
available at law or equity subject to the limitations set forth in this Agreement.



     19. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, IT IS HEREBY AGREED THAT IN NO EVENT
WILL THE SERVICER BE LIABLE FOR ANY LOST PROFITS OR OTHER INDIRECT, SPECIAL, INCIDENTAL OR
CONSEQUENTIAL DAMAGES WHICH THE CUSTOMER MAY INCUR OR EXPERIENCE BY REASON OF HAVING ENTERED INTO
OR RELIED ON THIS AGREEMENT OR ARISING OUT OF OR IN CONNECTION WITH THE SERVICES, EVEN IF THE
SERVICER HAS BEEN ADVISED OR IS OTHERWISE AWARE OF THE POSSIBILITY OF SUCH DAMAGES; NOR SHALL THE
SERVICER BE LIABLE FOR ACTS OF GOD, MACHINE OR COMPUTER BREAKDOWN OR MALFUNCTION, INTERRUPTION OR
MALFUNCTION OF COMMUNICATIONS OR POWER SUPPLY, LABOR DIFFICULTIES, LEGAL ACTS OF A PUBLIC
AUTHORITY, OR ANY OTHER SIMILAR CAUSE OR CATASTROPHE BEYOND THE SERVICER’S CONTROL.



     20. The Customer may not assign this Agreement nor any of its rights or obligations hereunder
without the written consent of the Servicer. The Servicer may assign this Agreement, and any of
its rights and obligations (including, without limitation, its obligation to provide the Services)
to any affiliate of the Customer; provided that for the avoidance of doubt, the foregoing shall not
limit the Servicer’s right to delegate the Services to one or more Subservicers pursuant to
Section 2 above.



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     21. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL
BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.



     22. The Servicer will regard and preserve as confidential all data of a confidential nature
related to the business of the Customer and provided by the Customer to the Servicer. The Servicer
will take the same precautions to preserve such confidential information as the Servicer takes
with respect to its own confidential information.



     23. This Agreement may be terminated at any time by a written agreement between the parties
and at any time by either party upon the greater of (i) ninety (90) days’ written notice and (ii)
the number of days’ written notice equal to the sum of five (5) Business Days plus the number of
days written notice upon which the Servicer is permitted to terminate each related Subservicing
Agreement without cause. In addition, the Servicer may terminate this Agreement with respect to any
mortgage loan subject hereto simultaneous with the effectuation of any Subservicer’s “call right”
to purchase such mortgage loans, as contemplated pursuant to Section 7.04 of that certain asset
exchange agreement dated as of November 18, 2009 by and between the Servicer and the Customer.



     24. No waiver of any of the terms or conditions of this Agreement shall be effective or
binding unless such waiver is in writing and is signed by both of the parties hereto, nor shall
this Agreement be changed, modified, discharged or terminated other than in accordance with its
terms, in whole or in part, except by a writing signed by both parties.



     25. All communications and notices relating to this Agreement are to be sent:



     If to the Servicer:


Aurora Bank Commercial Services

27422 Portola Pkwy, STE 205 #419

Foothill Ranch, CA 92610

Attention: Steve Skolnik



Aurora Loan Services LLC

10350 Park Meadows Drive, 3rd Floor

Littleton, CO 80124

Attention: Todd Whittemore



with copies to:



Aurora Bank FSB

1271 Avenue of the Americas

New York, NY 10020

Attention: William K. Walenczyk





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and:



Aurora Bank FSB

1000 West Street

Wilmington, DE 19801

Attn: General Counsel




     If to the Customer:


Capital Crossing Preferred Corporation

1271 Avenue of the Americas

New York, NY 10020

Attention: President



with a copy to:



Lloyd Winans, Esq.

Alston & Bird LLP

90 Park Avenue

New York, NY 10016



or to such other address as a party may designate to the other and such notices shall be deemed
duly given three (3) days after mailed or upon delivery by hand or upon receipt of confirmed answer
back if telephoned.




     26. Whenever possible, each provision of this Agreement will be interpreted in such manner as
to be effective and valid under applicable law, but if any provision of this Agreement is held to
be prohibited by or invalid under applicable law, such provision will be in effect only to the
extent of such prohibition or invalidity, without invalidating the remainder of such provision or
the remaining provisions of this Agreement.



     27. This Agreement embodies the entire understanding of the parties with respect to the
subject matter hereof, and there are no further or other agreements or understandings, written or
oral, in effect between the parties relating to the subject mater of this Agreement.



     28. This Agreement shall be binding upon and inure solely to the benefit of each party hereto,
and nothing in this Agreement, express or implied, is intended to confer upon any person, any
rights or remedies of any nature whatsoever under or by reason of this Agreement.



     29. This Agreement may be executed by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken together shall
constitute but one and the same Agreement.



(Signature Page Immediately Follows)






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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
officers thereunto duly authorized as of the day and year first above written.




	 	 	 	 	 
	 	SERVICER:



Aurora Bank FSB

 	 
	 	By:  	/s/ Todd Whittemore
 	 
	 	 	Name:  	Todd Whittemore 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	CUSTOMER:



Capital Crossing Preferred Corporation

 	 
	 	By:  	/s/ John Schmohl
 	 
	 	 	Name:  	John Schmohl 	 
	 	 	Title:  	Chief Operating Officer 	 
	 



Signature Page to Amended and Restated Master Service Agreement









 









 








EXHIBIT A




DATA PROCESSING / PROCESSING SERVICES




     Data processing services to be provided pursuant to this Agreement shall include, but not
necessarily be limited to, the following specific computer services:



     1. All Customer application processing, regardless of where actually processed, that presently
exists or is established in the future for the conduct of customer transactions and management
information. Included herein are host based activities and PC-based management information
systems, as well as input/output to and from such activity.



     2. All actions necessary to maintain, enhance existing or develop new data processing services
for the benefit of the Customer.



     3. Transportation of documents.



     4. Document encoding, capture, cash letter preparation, reject handling and bulk.



     The Servicer shall receive fees from the Customer as consideration for the performance of data
processing and item processing services pursuant to the terms of the Agreement in accordance with
Exhibit D annexed hereto.







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EXHIBIT B




LOAN SERVICING



     Loan servicing to be provided pursuant to this Agreement shall include, but not necessarily be
limited to, the following specific services:



     1. Make diligent efforts to collect all sums due and payable from borrowers under the terms of
each loan;



     2. Deposit of all payments (i) made by a borrower pursuant to the terms of a loan and
collected by Servicer and (ii) required to be remitted to Customer pursuant to the terms of this
Agreement, in a separate account at the Servicer (or applicable Subservicer) in trust for the
Customer.



     3. Monthly remit to the Customer principal and interest payments collected on loans;



     4. Reconcile account balances for any accounts established in connection with the loan
servicing performed pursuant to this Agreement.



     5. Taking all reasonable and necessary steps to cause any mortgaged premises to be kept
insured against loss or damage by fire or other hazards and for such amounts required by the
applicable Subservicing Agreement, if any, in effect. The Servicer or the applicable Subservicer
shall secure and retain copies of any insurance policies so in effect for the benefit of the
Customer;



     6. Maintain a detailed record of each loan and collection thereon. The Customer or its
authorized representative may examine such record at such time or times as it may elect during the
Servicer’s normal business hours.



     7. Take all reasonable and necessary steps to comply with and use best efforts to cause the
Customer to comply with any and all applicable federal and state statutes or regulations or private
mortgage insurance company requirements while servicing all loans pursuant to the terms of this
Agreement.



     8. In the event foreclosure proceedings are instituted, the Servicer or Subservicer shall
foreclose, manage and protect the mortgaged premises in the manner and to the extent required
pursuant to the terms of Exhibit C of the Agreement;



     9. The Servicer shall enter all new loans and information which may be required from time to
time onto the data processing software used by the Servicer to service loans for the Customer;



     10. The Servicer shall ensure the maintenance of perfected collateral positions securing loans
serviced pursuant to the terms of the Agreement;



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     11. The Servicer or Subservicer shall compute, notify the borrowers of, and effect any
adjustments to the interest rate and payment terms of a serviced loan in accordance with applicable
law.



     The Servicer shall receive fees from the Customer as consideration for the performance of
services pursuant to terms of the Agreement in accordance with the schedule set forth below as
Exhibit D. Servicer shall, to the extent permitted by law, also be entitled to collect
interest earned upon escrow deposits associated with the loans under service.








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EXHIBIT C




NONPERFORMING LOAN SERVICING AND FORECLOSURE SERVICES



     Nonperforming loan servicing and foreclosure services to be provided by the Servicer for the
Customer pursuant to the Agreement shall include, but not necessarily be limited to, the following
specific services:



     1. Institution of foreclosure proceedings in the appropriate federal or state court as deemed
necessary by the Servicer;



     2. The Servicer may, at Servicer’s option, repurchase nonperforming loans at their fair market
value at the time of foreclosure and/or repossession; and



     3. The Servicer shall (or shall, to the extent Servicer has the right to do so under the
Subservicing Agreement, cause the applicable Subservicer to), if directed by the Customer, dispose
of any nonperforming loans for such amount equal to the fair market value thereof or as otherwise
approved by the Customer.



     The Servicer shall be paid a fee by the Customer as consideration for the performance of
foreclosure services pursuant to the terms of the Agreement in accordance with Exhibit D
annexed hereto.








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EXHIBIT D




SCHEDULE OF FEES FOR SERVICES

PERFORMED PURSUANT TO SERVICE AGREEMENT



     For consideration of services provided by the Servicer on behalf of the Customer pursuant to
the terms and conditions of the Agreement, Servicer shall be entitled to retain from remittance
hereunder as contemplated in Section 9 above (or the Customer shall, to the extent funds retained
by the Servicer pursuant to Section 9 above are insufficient, pay the Servicer within ten (10)
Business Days of receipt by the Customer of a related invoice) the following fees with respect to
each mortgage loan subject hereto:



     (A) The sum of $8.00 (eight dollars) per calendar month plus:



          (i) With respect to mortgage loans set forth on Schedule 1 attached hereto, (a) an annual fee
equal to the product of 0.2775% (27.75 basis points) and the monthly outstanding principal balance
of such mortgage loans plus (b) loss mitigation fees (calculated as permitted under the Freddie Mac
Guide for servicers with a Servicer Performance Profile of Tier 1, as such terms are defined in
such Guide), a $500 REO property management fee with respect to REO properties, and ancillary
income and other fees to which the applicable subservicer is entitled under the related
Subservicing Agreement (as in effect on the date hereof).




          (ii) With respect to assets set forth on Schedule 2 attached hereto, (a) an annual fee equal
to the product of 0.405% (40.5 basis points) and the monthly outstanding principal balance of such
assets plus (b) any ancillary income and other fees to which the applicable subservicer is entitled
under the related Subservicing Agreement (as in effect on the date hereof).




          (iii) With respect to mortgage loans set forth on Schedule 3 attached hereto:





     (a) with respect to each mortgage loan other than a Nonperforming Loan (as
defined in clause (b) below), an annual fee (payable in twelve (12) monthly
installments) equal to the product of 0.50% (50 basis points) and the outstanding
principal balance of such mortgage loan (as determined with respect to each monthly
installment as of the prior month end);




     (b) an annual fee (payable in twelve (12) monthly installments) equal to the
product of 1.50% (150 basis points) and the outstanding principal balance of all
mortgage loans with respect to which the related borrower has failed to make the
monthly payment due in the second calendar month immediately preceding the calendar
month in which the applicable monthly installment is payable hereunder (each, a
“Nonperforming Loan”);




     (c) a workout fee of two percent (2%) of all monthly principal and interest
payments with respect to a mortgage loan from and after the date, if any, upon which
(i) any such Nonperforming Loan becomes current or (ii) the Servicer causes the
related borrower to cure a default (other than a default with respect to the timely
payment of principal and interest) by such borrower with respect to



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such mortgage loan; provided that this fee ceases to be payable if (x) the
applicable mortgage loan becomes an REO property, (y) the applicable mortgage loan
was a Nonperforming Loan that becomes current and then subsequently becomes a
Nonperforming Loan again or (z) with respect to a fee earned pursuant to clause (ii)
above, the default giving rise to such fee reoccurs; and




     (d) a resolution fee of two percent (2%) of the net liquidation proceeds (total
amount of monies collected at the liquidation of a mortgage loan or foreclosed
property, less advances made by the Servicer including, but not limited to
delinquent tax amounts, insurance premiums, property preservation costs, property
management costs, commissions, legal fees, and any other advance deemed necessary by
the Servicer to manage the mortgage loan or REO property) from a delinquent mortgage
loan (two or more payments past due) or REO property.



          (iv) With respect to mortgage loans made subject to this Agreement following the date hereof,
an amount mutually agreed to by the Servicer and the Customer in writing.




     (B) Out of pocket costs related to each loan anticipated for foreclosure or in foreclosure
(past due +90 days, non-accrual, and owned real estate).




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