WORDS TO THAT EFFECT IN THIS AGREEMENT SHALL MEAN THE
INCURRENCE BY A PARTY OF ACTUAL LOSSES IN EXCESS OF $50,000 IN THE AGGREGATE;
PROVIDED, THAT SUCH TERMS SHALL NOT INCLUDE ANY EFFECT ON THE DIVISION OR THE
ACQUIRED ASSETS OF (I) CHANGES IN LAWS AND REGULATIONS OR INTERPRETATIONS
THEREOF THAT ARE GENERALLY APPLICABLE TO THE MORTGAGE BANKING INDUSTRY,
(II) CHANGES IN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES THAT ARE GENERALLY
APPLICABLE TO THE MORTGAGE BANKING INDUSTRY, (III) CHANGES IN INTEREST RATES, OR
(IV) ACTIONS OR OMISSIONS OF THE SHAREHOLDER OR SELLER PRIOR TO CLOSING THAT
WERE TAKEN OR OMITTED IN RESPONSE TO REQUESTS RECEIVED BY SELLER FROM, OR
DIRECTIONS MADE TO SELLER BY, BUYER WITH RESPECT TO THE BUSINESS OF THE
DIVISION.
8.5
LIMITATION.
EXCEPT AS TO (A) ANY LOSS
ARISING FROM ACTUAL FRAUD BY A PARTY OR (B) THE MATTERS COVERED BY SECTION 8.6
BELOW, THE SELLER'S AND THE SHAREHOLDER'S COLLECTIVE AGGREGATE LIABILITY WITH
RESPECT TO LOSSES SHALL NOT EXCEED AN AMOUNT EQUAL TO THE PURCHASE PRICE.
8.6
BUYER'S REMEDIES FOR BREACH OF
REPRESENTATIONS AND WARRANTIES RELATING TO PIPELINE LOANS.
(A)
IN THE EVENT THERE IS A BREACH OF ANY OF SELLER'S REPRESENTATIONS AND
WARRANTIES WITH RESPECT TO THE PIPELINE LOANS, INCLUDING, WITHOUT LIMITATION,
THE REPRESENTATIONS AND WARRANTIES UNDER SECTIONS 3.12, 3.13 AND 3.16, SELLER
SHALL CURE SUCH BREACH WITHIN SIXTY (60) DAYS AFTER NOTICE OF THE BREACH FROM
BUYER TO SELLER.
(b)
Buyer may require the Seller and/or Shareholder to repurchase any Pipeline
Loan that was fraudulently underwritten by Seller's employees and/or involving
fraudulent activities by the applicant, appraiser, realtor or title company in
seeking to obtain the Pipeline Loan.
(C)
IN THE EVENT SELLER AND/OR SHAREHOLDER IS REQUIRED TO REPURCHASE A PIPELINE
LOAN, THE REPURCHASE PRICE SHALL BE EQUAL TO THE UNPAID PRINCIPAL OF SUCH LOAN
PLUS (I) ACCRUED AND UNPAID INTEREST ON SUCH PRINCIPAL BALANCE AT THE INTEREST
RATE BORNE BY SUCH LOAN THROUGH THE DATE OF REPURCHASE, AND (II) ANY OUT OF
POCKET COST AND EXPENSE INCURRED BY BUYER IN CONNECTION WITH SUCH REPURCHASE,
INCLUDING, WITHOUT LIMITATION, ANY PREMIUM REBATE OR RECAPTURE.
SELLER AND/OR
SHAREHOLDER SHALL CONSUMMATE THE REPURCHASE WITHIN THIRTY (30) DAYS AFTER
WRITTEN DEMAND FROM BUYER FOR REPURCHASE OF THE LOAN.
SELLER AND/OR SHAREHOLDER
SHALL PAY THE REPURCHASE PRICE TO BUYER BY WIRE TRANSFER TO AN ACCOUNT
DESIGNATED BY BUYER.
(D)
IN THE EVENT OF ANY REPURCHASE OF A LOAN BY SELLER AND/OR SHAREHOLDER (AS
APPLICABLE), (I) BUYER SHALL TENDER TO SELLER AND/OR SHAREHOLDER THE MORTGAGE
FILE MAINTAINED BY BUYER WITH RESPECT TO SUCH LOAN, INCLUDING, WITHOUT
LIMITATION, THE ORIGINAL MORTGAGE NOTE, MORTGAGE AND ALL OTHER DOCUMENTS IN
BUYER'S POSSESSION RELATING TO THE
20
ORIGINATION AND SERVICING OF THE LOAN, (II) BUYER SHALL TRANSFER TO SELLER ALL
ESCROW ACCOUNTS RELATING TO SUCH LOAN, INCLUDING, WITHOUT LIMITATION, UNAPPLIED
SUSPENSE FUNDS HELD FOR ANY PURPOSE AND ACCRUED INTEREST ON SUCH ESCROW ACCOUNTS
AT THE OVERNIGHT RATE CHARGED BY THE FEDERAL HOME LOAN BANK OF DALLAS (LESS ANY
INTEREST ON ESCROW OBLIGATION DUE THE MORTGAGOR) AND