Document:

Mortgage Partnership Finance Participating Financial Institution Agreement

  
 Exhibit 10.4.1

  
 FEDERAL HOME LOAN BANK OF CHICAGO 
 MORTGAGE PARTNERSHIP FINANCE® PROGRAM 
 PARTICIPATING FINANCIAL
INSTITUTION AGREEMENT 
  
 [purchase only] 
  
 THIS PARTICIPATING FINANCIAL INSTITUTION AGREEMENT (the
“Contract”) is dated as of April 11, 2000 between the participating financial institution (the “PFI”) that signs this document and the FEDERAL HOME LOAN BANK OF CHICAGO (the “Bank”), a corporation
organized and existing under the laws of the United States of America. 
  

	I.	GENERAL INFORMATION 

  
 This article contains important basic information about the Contract. 
  
 1.1. Purpose of Contract. The purpose of this Contract is: 
  
 (a) to establish the PFI as an approved seller of Mortgages
to the Bank under the MORTGAGE PARTNERSHIP FINANCE®
Program, a program established by the Federal Home Loan Bank of Chicago (in such capacity, the “MPF Provider”); 
  
 (b) to establish the terms and conditions for the origination of those Mortgages which the Bank will purchase; 
  
 (c) to establish the terms and conditions, including,
without limitation, the credit enhancement obligations of the PFI, under which the Bank will purchase Mortgages; 
  
 (d) to establish the PFI as an approved servicer of Mortgages held by the Bank, whether originated by the PFI or by others; and

  
 (e) to provide the terms and conditions of
servicing Mortgages for the Bank, whether originated by the PFI or by others. 
  
 1.2. Consideration. In consideration of the purpose of this Contract and of all the provisions and mutual promises contained in it, the PFI and the Bank agree to all that this Contract contains. 
  
 1.3. The Guides. From time to time, the MPF Provider issues its guides
to PFIs (collectively, the “Guides”), and modifications of the Guides, and furnishes them to the PFI which the PFI agrees are incorporated into this Contract by reference as if fully set forth herein. These Guides are: 

 
 (a) the MORTGAGE PARTNERSHIP FINANCE Origination Guide;
and 
  
 (b) the MORTGAGE PARTNERSHIP FINANCE
Servicing Guide. 
  
 Whenever there is a reference to the Guides
in this Contract, it means either or both the Origination Guide and the Servicing Guide, as the context may require and as they exist now and as they may be amended or supplemented in writing. The MPF Provider may amend or supplement the Guides, or
either of them, from time to time, at its sole discretion, by furnishing amendments or supplementary matter to the PFI. The Origination Guide is applicable to the origination of Mortgages by the PFI for sale to the Bank or the sale of Mortgages to
the Bank which were purchased by the PFI. However, such provisions of the Origination Guide applicable solely to Bank Funded Mortgages do not apply to this Contract. 
  
 The term “Guides” also includes anything that, in whole or in part, supersedes or is substituted for the
Guides. 
  

 1.4 Certain Definitions. Anywhere the words that appear below are used in this Contract (whether
or not capitalized, and whether used in the singular or the plural), the following definitions apply: 
  
 (a) “Applicable Laws”. All federal and state laws, ordinances, rules, regulations and orders applicable to the
origination, holding or servicing of Mortgages by the PFI for itself or as agent for the Bank. 
  
 (b) “Bank Funded Mortgages”. Mortgages originated by the Originator as agent for the Bank, which Mortgages are funded by
the Bank at or prior to the closing thereof and which at no time are owned by the Originator but are rather owned by the Bank at closing. 
  
 (c) “Business Day”. Any day (other than Saturdays and Sundays) that the MPF Provider is open for business. 
  
 (d) “Closed Mortgages”. Mortgages that the
Bank purchases from the Originator which are owned by the Originator prior to such purchase and owned by the Bank after such purchase and which were previously funded or purchased by the Originator. 
  
 (e) “Confirmation”. A writing or machine-
or electronically-generated transmission issued by the Bank confirming the purchase of one or more Mortgages and which shall evidence the Bank’s ownership of such Mortgage or Mortgages, in a form as specified in the Guides. 
  
 (f) “Delivery Commitment”. A written
confirmation of the Bank to the Originator in response to the Originator’s oral delivery commitment offer made from time to time under this Contract and in accordance with the provisions of the Guide, pursuant to which the Originator commits to
deliver to the Bank Mortgages satisfying the terms set forth therein within the period set forth therein. 
  
 (g) “GSEs”. The federal government sponsored enterprises, including, without limitation, the Federal National Mortgage
Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”), and their successors. 
  
 (h) “Indemnified Party”. Each of the Bank, any Participant, and each of their respective successors and assigns, and each
of their respective shareholders, directors, officers, employees and agents. 
  
 (i) “Master Commitment”. A Master Commitment of the Originator to sell Mortgages under this Contract, to be entered into by the Originator and the Bank in accordance with the Guides. 
  
 (j) “Mortgage”. A loan, evidenced by a
note, bond or other instrument or evidence of indebtedness which is secured by a Mortgage, deed of trust, deed to secure debt or other instrument or document of security that applies to property. The term “Mortgage” also includes,
as the context requires, such instruments, evidences or documents of indebtedness and security, together with: 
  
 (1) the evidence of title; and 
  
 (2) all other documents, instruments and papers pertaining to the loan. 
  
 (k) “Originator”. The PFI, in its capacity as an owner and seller of Mortgages under this
Contract. 
  
 (l)
“Participants”. See Section 18.1 below. 
  
 (m) “Person”. Any individual, corporation, partnership, joint venture, association, joint-stock company, trust, limited liability company, unincorporated organization, government or any agency or
political subdivision thereof. 
  

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 (n) “Property” or “Mortgaged Property”. The property
that is subject to a Mortgage or, where the Mortgage has been foreclosed or possession or title to the property has been taken by the Bank or on the Bank’s behalf, was subject to such Mortgage. 
  
 (o) “Remaining Credit Enhancement”. At any
time, the credit enhancement obligation of the PFI which amount shall be equal to the Actual Credit Enhancement less the Realized Loss paid by the PFI pursuant to Section 4.5. 
  
 (p) “Servicer”. The PFI, in its capacity as a servicer of Mortgages under this Contract.

  
 All other terms used but not defined herein shall have the same respective
meanings as set forth in the Guides. 
  

	II.	ELIGIBILITY REQUIREMENTS FOR ORIGINATORS 

  
 For the PFI to sell Mortgages to the Bank, the PFI must satisfy the eligibility requirements specified in this article. 
  
 2.1. General Requirements. These are the general requirements the PFI
must meet to be eligible to sell Mortgages to the Bank: 
  
 (a) Meet the Bank’s Standards. The PFI must have and maintain as one of its principal business purposes the origination or purchase of Mortgages of the type that the PFI will sell to the Bank under this
Contract. In addition, the PFI, in the Bank’s judgment, must, at all times, have the capacity to purchase Mortgages for the Bank that meet the Bank’s standards and the standards generally imposed by other GSEs and private institutional
Mortgage investors. Finally, the PFI must, at all times, satisfy the applicable requirements for sellers of Mortgages set forth in the Guides. 
  
 (b) Have Qualified Staff and Adequate Facilities and Systems. The PFI must, at all times, employ personnel or agents who are well
trained and qualified to perform the functions required of the PFI under this Contract. In addition, the PFI must maintain facilities and systems that are able to perform its functions under this Contract. 
  
 (c) Maintain Fidelity Bonds and Errors and Omissions
Coverage. The PFI must maintain, at its own expense, a fidelity bond and errors and omissions insurance, as required by the Guides. 
  
 (d) Report Basic Changes. The PFI must notify the Bank promptly in writing of any material changes that occur in its or its
agents’ principal purpose, activities, staffing, facilities, fidelity bond or errors and omissions insurance. 
  
 2.2 Ownership and Status of PFI. In approving a PFI in connection with the obligations of Articles III and IV, the Bank relies on the information
the PFI has provided about the eligibility, qualifications and financial status of the PFI and its owners. The PFI covenants and agrees to comply with the provisions of the Guides regarding these matters, including, without limitation, the delivery
of notices regarding these matters as required by the Origination Guide. Changes in any such matters may affect the PFI’s eligibility to sell Mortgages to the Bank. 
  
 2.3. Financial Information. In order to become and remain an approved Originator under this Contract, the PFI must
provide the financial information required by the Guides from time to time and must satisfy the standards set forth in the Guides. 
  
 2.4. Access to PFI’s Records. As set forth in the Guides, the PFI agrees to permit, and cause its agents to permit, the Bank’s employees
and designated representatives to examine or audit books, records and information pertaining to the Mortgages. 
  

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	III.	SALE OF MORTGAGES 

  
 This article contains the basic rules governing the origination of Mortgages for sale to the Bank. The Originator hereby agrees as follows: 
  
 3.1. What Governs Origination. The sale of Mortgages will be governed
by: 
  
 (a) this Contract; 
  
 (b) the Guides, including, without limitation, with respect
to any particular Mortgage, all amendments in effect on the day the Originator or its designee issues a written or electronic commitment to the mortgagor of such Mortgage to make the loan evidenced and secured by the Mortgage; 
  
 (c) the applicable Master Commitment; 
  
 (d) the Bank’s written confirmations of its acceptance
of Delivery Commitments issued from time to time; and 
  
 (e) the Bank’s issuance of a Confirmation at the time it funds its purchase of a Mortgage. 
  
 3.2. What Mortgages can be Originated under this Contract. The Originator will only sell to the Bank a Mortgage under this Contract which satisfies
the requirements set forth herein and in the Guides on the day the Originator or its designee issues a written or electronic commitment to the mortgagor of such Mortgage to make the loan evidenced and secured by the Mortgage. 
  
 3.3 Master Commitment. 
  
 (a) General. Mortgages will be sold to the Bank under
Master Commitments. The Originator commits to use its best efforts sell to the Bank Mortgages satisfying the Master Commitment within the estimated period for the origination or sale of such Mortgages as set forth in the applicable Master
Commitment, as such estimated period may be modified in accordance with the Guides. 
  
 (b) Execution of Master Commitments. From time to time, the Bank and the Originator may jointly elect in writing to enter into one
or more Master Commitments. There can be more than one Master Commitment outstanding at any time. Each Master Commitment will specify that the Mortgages thereunder will be Closed Mortgages. 
  
 (c) Types of Mortgages. A Master Commitment may
contain various types of either fixed rate or adjustable rate Mortgages, as permitted by the Guides. 
  
 (d) Allocation of Delivery Commitments to a Master Commitment. Each Delivery Commitment must be consistent with the then
unallocated amount under an outstanding Master Commitment which shall be identified by the Originator as part of the Delivery Commitment. Upon the Bank’s issuance of a confirmation of a Delivery Commitment, such Delivery Commitment shall be
allocated to the specified Master Commitment. Unless the MPF Provider waives this provision, once a Delivery Commitment is allocated to a Master Commitment such Delivery Commitment shall not be reallocated to another Master Commitment. 

 
 (e) Allocation of Mortgages to a Delivery
Commitment. Each Mortgage must be consistent with the then unallocated amount under an outstanding Delivery Commitment which shall be identified by the Originator with respect to such Mortgage. Upon the Bank’s funding of its purchase of
such Mortgage, as applicable, such Mortgage shall be allocated to the specified Delivery Commitment. Upon such allocation, such Mortgage shall not be reallocated to another Delivery Commitment. 
  
 (f) Spread Account Information. Each Master
Commitment shall have its own Spread Account. The amounts to be allocated with respect to each Spread Account from time to time shall be determined in accordance with the Guides and the information set forth in the applicable Master Commitment.

  

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 3.4. Purchase Price. For each Closed Mortgage under this Contract, the Originator shall be paid
the purchase price as determined by the Origination Guide or separate agreement with the Bank. The MPF Provider will determine the purchase price for any particular Mortgage, which may be at par, at a premium or a discount, based upon the applicable
Delivery Commitment and rate and fee schedule, all as more fully described in the Origination Guide. The rate and fee schedule for different types of Mortgages may be different, and the rate and fee schedule for a particular type of Mortgage may
change daily or more often. 
  
 3.5. The Bank has No Obligation
to Commit. The fact that the Bank has executed or delivered this Contract does not mean that it must make a commitment to purchase any Mortgage through the Originator. 
  
 3.6. PFI’s Role as Mortgage Originator. The Originator shall owe the Bank fiduciary duties in connection with
the origination or acquisition and sale of Mortgages. The Originator shall originate or acquire all such Mortgages under this Contract in its own name and transfer such Mortgages to the Bank in accordance with the Origination Guide. The Bank’s
interest in all Mortgages purchased under this Contract shall be evidenced by a Confirmation which shall conclusively establish the Bank’s ownership of the Mortgages. Section 5.5 of this Contract specifies certain circumstances in which the
Originator may be obligated to purchase or repurchase a Mortgage from the Bank. Except with regard to any Mortgage the Originator is required to purchase under Section 5.5, the Originator acknowledges and agrees that at no time will it or any other
Person (other than the Bank, the Participants and their respective successors and assigns) have any interest in Closed Mortgages purchased under this Contract after the sale of such Mortgages to the Bank. With the exception of any Mortgages the
Originator may be required to purchase or repurchase under Section 5.5, the Originator will take all action necessary to protect the rights of the Bank, the Participants and their respective successors and assigns in the Mortgages purchased under
this Contract against any other Person. 
  

	IV.	CREDIT ENHANCEMENT; REALIZED LOSSES 

  
 4.1. Spread Account. 
  
 (a) Establishment. For each Master Commitment, the Bank will establish a contingent liability account (the “Spread
Account”). All amounts from time to time allocated to the Spread Account shall be the responsibility of the Bank, and the PFI shall have no obligation with respect thereto. 
  
 (b) Allocations. For each Master Commitment, the Bank shall allocate amounts to the applicable Spread
Account which may be done monthly based upon the moneys received from the Servicer with respect to the Mortgages allocated to such Master Commitment, or the Bank may make such allocation at the time the Mortgages are purchased under such Master
Commitment, or allocations to the Spread Account may be made as otherwise agreed between the parties, in the amounts determined in accordance with the Guides and such Master Commitment. 
  
 (c) Losses. Amounts allocated to the Spread Account for a Master Commitment will be used to absorb
losses realized on Mortgages (and related REO Properties) allocated to such Master Commitment in accordance with the provisions of Section 4.3 below. 
  
 4.2. Credit Enhancement/Recourse Obligation. Each Master Commitment will include a Maximum Credit Enhancement for the pool of Mortgages to be
purchased under such Master Commitment. The Bank and the PFI may from time to time modify the Maximum Credit Enhancement in accordance with the Guides. As individual Mortgages are assigned to Delivery Commitments, the Actual Credit Enhancement will
be calculated by the Bank in accordance with the Guides. In no case shall the Actual Credit Enhancement exceed the then outstanding Maximum Credit Enhancement for any pool. When the Master Commitment is deemed to be closed to further Delivery
Commitments and all Delivery Commitments have been funded or expired, the Actual Credit Enhancement calculated by the Bank in accordance with the Guides shall become the Remaining Credit Enhancement. 
  

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 4.3. Allocation of Realized Losses; Priorities. The Realized Loss for any Mortgage (after
application of any applicable governmental or private Mortgage insurance or guaranties) will be allocated and paid in the following order of priority: 
  
 (a) First, out of amounts allocated to the applicable Spread Account, by the Bank upon its receipt of notification from the Servicer or
any other applicable Mortgage loan servicer providing the notice of the amount of such Realized Loss to the Bank as provided in Section 4.4 below; 
  
 (b) Second, for any Realized Loss remaining after the application set forth in clause (a), from the Originator, not to exceed the
Remaining Credit Enhancement for the applicable Master Commitment, by the PFI remitting such amount pursuant to Section 4.5 below; and 
  
 (c) Finally, for any Realized Loss remaining after the application set forth in clauses (a) and (b), such loss shall be allocated directly
to the Bank. 
  
 It is understood that the Spread Account for any Master
Commitment may be exhausted at a given point in time but that subsequent credits to the Spread Account may thereafter cause the Spread Account to have a positive balance which could then be applied to cover any future Realized Losses. No such
subsequent positive balance will be available or used to reimburse the Originator for Realized Losses previously incurred and funded by the Originator under clause (b). 
  
 4.4. Procedure for Making Claims against the Spread Account. In the event that the Servicer or any other applicable
Mortgage loan servicer determines that there is a Realized Loss with respect to a Mortgage or REO Property, the Servicer or such other Mortgage loan servicer will promptly deliver a written notice as specified in the Servicing Guide and the Bank
shall charge the applicable Spread Account with the amount as provided for in the Servicing Guide except to the extent that the Bank disputes the existence or determination of any Realized Loss or the amount thereof or the process related thereto,
in which event the Bank’s determination shall control. The Servicer or any other applicable Mortgage loan servicer shall be reimbursed for such portion of the Realized Loss chargeable to the Spread Account to the extent that such Servicer or
other Mortgage loan servicer has previously advanced such funds to the Bank. 
  
 4.5. Procedure for Making Claims against the PFI. From time to time upon notice by the Bank, which notice shall identify the aggregate amount of Realized Loss to be funded by the PFI pursuant to clause (b) of
Section 4.3 above at such time, the Bank shall withdraw such amounts from the Daily Investment Deposit (“DID”) account of the PFI at the Bank and in the event that any such withdrawal from the PFI’s DID account shall cause the balance
in such account to become negative, such deficit shall be deemed an advance under the Master Transactions Agreement between the PFI and the Bank. In the event of the breach by the PFI of its obligation to make any such payment, the Bank shall have
all rights available at law or in equity, specifically, but not limited to, (x) the right to terminate, in whole or in part, the rights of the PFI under this Contract and (y) the right of set-off against any funds of the PFI held by, or at, the
Bank. 
  
 4.6. Credit Enhancement Fees. For each Master
Commitment, in consideration of the obligation of the PFI to fund a Realized Loss pursuant to Section 4.3(b), the Bank shall pay to the PFI monthly a credit enhancement fee determined in accordance with the Guides, based upon the Credit Enhancement
Fee Rate applicable to such Master Commitment. 
  
 4.7.
Collateral for the PFI’s Obligations. Upon the request of the Bank, the PFI shall deliver to the Bank from time to time collateral for its obligations under this Article IV. The Bank may change the nature or amount of the required
collateral from time to time, and the PFI, at its expense, shall deliver to the Bank such replacement or additional collateral as provided in the advances and security agreement between the PFI and the Bank (the “Advances Agreement”), it
being understood that the PFI’s obligations under this Article IV are included in and subject to the terms of the Advances Agreement. 
  
 4.8. Right of Setoff and Grant of Security Interest. To secure any and all indebtedness or liability of the PFI to the Bank under this Contract or
under any other agreement with the Bank, however and whenever incurred or evidenced, whether direct or indirect, absolute or contingent, due or to become due, the PFI hereby assigns, transfers, and pledges to the Bank and grants to the Bank a first
priority perfected security interest in (i) all balances, credits, deposits, moneys, and drafts now or hereafter in the deposit account(s) or any other account that the PFI may maintain with the Bank, and (ii) all collateral provided by the PFI from
time to time as described in Section 4.7 above; and the Bank is authorized to charge such indebtedness or liability against the deposit account(s), or any other account or such other collateral, whether or not the same is then due. The Bank shall
notify the PFI of any actions 

  

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taken pursuant to this Section 4.8, but such notification shall not be a condition precedent to the right of the Bank to take any such action. The Bank shall
have all other rights available at law or in equity with respect to the right of setoff and the security interest provided in this Section 4.8. The PFI, at its cost, will (i) execute and deliver to the Bank such specific pledge or security agreement
as is provided in the Guides or required by the Bank, and (ii) execute, deliver and file such UCC financing statements and take such other action from time to time to perfect and maintain the perfection of the Bank’s security interest and
rights under this Section 4.8. 
  

	V.	ORIGINATION OF MORTGAGES - PFI’S WARRANTIES 

  
 5.1. General. The PFI makes certain warranties to the Bank. These warranties: 
  
 (a) apply to each Mortgage sold to the Bank; 
  
 (b) are made as of the date hereof (except with respect to warranties under Section 5.3 with respect to
Mortgages originated after the date hereof), as of the closing date of each such Mortgage (with respect to Closed Mortgages originated by the Originator) and as of the date of sale of each such Mortgage to the Bank (with respect to Closed Mortgages
not originated by the Originator); 
  
 (c)
continue after the origination of the Mortgage; 
  
 (d) continue after the Bank’s purchase of any Mortgage; 
  
 (e) are for the benefit of the Bank and any Participants, and its and their respective successors and assigns; and 
  
 (f) include the warranties set forth in the Guides. 
  
 Warranties may be waived, but only by the Bank in a writing duly executed and delivered by the Bank. 
  
 5.2. General PFI Warranties. The PFI makes each of the representations
and warranties set forth below regarding the PFI as of the date hereof and as of each day thereafter until termination of this Contract in accordance with its terms: 
  
 (a) It is duly organized, validly existing and in good standing under the laws governing its creation and
existence, and has full corporate power and authority to own its property, to carry on its business as presently conducted and to enter into and perform its obligations under this Contract. 
  
 (b) The execution, delivery and performance by it of this
Contract have been duly authorized by all necessary action on its part. Neither the execution and delivery of this Contract by it, nor the consummation by it of the transactions herein contemplated, nor compliance by it with the provisions hereof,
will conflict with or result in a material breach of, or constitute a material default under (i) any of the provisions of any law, governmental rule, regulation, judgment, decree or order binding on it or its properties; (ii) its organizational
documents or by-laws; or (iii) the terms of any material indenture or other agreement or instrument to which it is a party or by which it is bound. Neither it nor any of its affiliates is a party to, bound by, or in breach of or violation of any
indenture or other agreement or instrument, or subject to or in violation of any statute, order or regulation of any court, regulatory body, administrative agency or governmental body having jurisdiction over it, which materially and adversely
affects or to its knowledge may in the future materially and adversely affect its ability to perform its obligations under this Contract or its business, operations, financial condition, properties or assets. 
  
 (c) The execution, delivery and performance by it of this
Contract and the consummation of the transactions contemplated hereby do not require the consent or approval of, the giving of notice to, the registration with, or the taking of any other action in respect of, any state, federal or other
governmental authority or agency, except such as has been obtained, given, effected or taken prior to the date hereof. 
  
 (d) This Contract has been duly executed and delivered by it and constitutes a legal, valid and binding obligation of it, enforceable
against it in accordance with the terms hereof, except as such 

  

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enforcement may be limited by bankruptcy, insolvency, reorganization, receivership, conservatorship, moratorium and other similar laws affecting the
enforcement of creditors’ rights in general and by general equity principles, regardless of whether such enforcement is considered in a proceeding in equity or at law. 
  
 (e) There are no actions, suits or proceedings pending or, to its knowledge, threatened against or affecting
it, before or by any court, administrative agency, arbitrator or governmental body (i) with respect to any of the transactions contemplated by this Contract or (ii) with respect to any other matter which in its judgment will be determined adversely
to it and will, if determined adversely to it, materially and adversely affect it or its business, assets, operations or condition (financial or otherwise) or materially and adversely affect its ability to perform its obligations under this
Contract. 
  
 (f) The PFI has all licenses,
permits, authorizations, approvals and consents of all governmental authorities required in order for it to originate or purchase, hold and sell the Mortgages, and in all cases, to service the Mortgages. 
  
 (g) The PFI satisfies all requirements set forth in the
Guides to be an eligible Mortgage seller and an eligible Mortgage servicer. 
  
 (h) The PFI is in compliance with all Applicable Laws. 
  
 5.3. Specific Mortgage Warranties. The Originator makes each of the following specific representations and warranties with respect to each Mortgage and each Property as of the date the applicable Mortgage is
originated (in the case of Closed Mortgages originated by the Originator) or as of the date the applicable Mortgage is sold to the Bank (in the case of Closed Mortgages not originated by the Originator): 
  
 (a) Mortgage Meets Requirements. The Mortgage
conforms to all of the applicable requirements in the Guides, this Contract and Applicable Laws. 
  
 (b) Originator Authorized to Do Business. The Originator and any other party involved in the origination of the Mortgage, at all
applicable times: 
  
 (1) were authorized to transact business
in all applicable jurisdictions, including, without limitation, the jurisdiction where the Property is located, unless at all such times, such authorization to transact business was not required, based upon the activities of the Originator or other
relevant party, as the case may be; and 
  
 (2) possessed all
licenses, permits and approvals required by all Applicable Laws, including, without limitation, all Applicable Laws of the jurisdiction where the Property is located. 
  
 (c) Originator has Full Right to Sell. The Originator has full power and authority to sell and
service the Mortgage, and has duly authorized the sale and the servicing of the Mortgage. The Originator has not granted to any person other than the Bank any interest in the Mortgage or the right to originate, fund or hold the Mortgage, or any
interest therein. In addition, the Originator’s right, power and authority to sell and service the Mortgage is not subject to any other person’s interest, consent or approval or to any agreement with any other person. 
  
 (d) Lien on Property. The Mortgage is a valid and
subsisting perfected first lien and security interest on the Property described in it, and the Property is free and clear of all encumbrances and liens having priority over it except for liens for real estate taxes, and liens for special
assessments, that are not yet due and payable. 
  
 (e) Documents are Valid and Enforceable. All documents and instruments constituting a part of the Mortgage have been properly signed and delivered, are legal, valid and binding obligations of the persons purporting to be parties
thereto, enforceable in accordance with their respective terms, subject only to bankruptcy laws, Soldiers’ and Sailors’ Relief Acts, laws relating to administering decedents’ estates and general principles of equity. 
  

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 (f) Property Not Subject to Liens. The Property is free and clear of all
mechanics’ liens, materialmen’s liens or other liens (whether senior to, pari passu with or subordinate to the Mortgage). There are no rights outstanding that could result in any of such liens being imposed on the Property. The warranty
set forth in this subsection (f) is not made if the Originator furnishes the Bank with a title insurance policy in an amount and in a form acceptable to the Bank and issued by a title insurance company acceptable to the Bank, that gives the Bank
substantially the same protection as this warranty. 
  
 (g) Title Insurance. There is a Mortgage title insurance policy, or other title evidence acceptable to the Bank, on the Property. The title insurance policy is in a current ALTA form (or other generally acceptable form) issued by a
title insurance company satisfying the standards set forth in the Guides, is in an amount equal to the maximum principal amount of the Mortgage and includes all title endorsements required by the Guides. The title insurance insures (or the other
title evidence protects) the Bank or the Originator (pursuant to Section 3.6), as holding a first perfected lien against the Property. 
  
 (h) Modification or Subordination of Mortgage. The Originator has not done, and in the case of any Mortgage which the Originator
purchased, no prior holder of any interest in such Mortgage has done, any of the following, except as may be necessary to reform the Mortgage documents for the purpose of correcting or conforming such Mortgage documents to accurately reflect the
Mortgage transaction: 
  
 (1) materially modified or waived any
provision of the Mortgage; 
  
 (2) satisfied or canceled the
Mortgage in whole or in part; 
  
 (3) subordinated the Mortgage
in whole or in part; 
  
 (4) released the Property in whole or
in part from the Mortgage lien; or 
  
 (5) signed any release,
cancellation, modification or satisfaction of the Mortgage. 
  
 The warranty set forth in this subsection (h) is not made to the extent that any of the actions or occurrences set forth above have been done and have been expressly consented to by the Bank in a writing signed and delivered by the Bank
prior to the Bank’s purchase of the Mortgage. 
  
 (i) Mortgage in Good Standing. There is no default (or event or occurrence which, with notice or lapse of time or both, if uncured, would constitute a default) under the Mortgage, and all of the following that have become due and
payable have been paid or an escrow of funds sufficient to pay them has been established and funded and is held by the Originator: 
  
 (1) taxes; 
  
 (2) governmental and other assessments; 
  
 (3) insurance premiums; 
  
 (4) water, sewer and municipal charges; 
  
 (5) leasehold payments; and 
  
 (6) ground rents. 
  
 (j) Advances. The Originator has not made or knowingly received from others, any direct or indirect advance of funds in connection
with the loan transaction on behalf of the mortgagor except as provided in the Guides. This warranty does not cover payment of interest from the earliest of: 
  

(1) the date of the Mortgage note; or 
  

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 (2) the date on which the Mortgage proceeds were disbursed; or 
  
 (3) the date one month before the first installment of principal and
interest on the Mortgage is due, to the end of the month in which such date occurs, by the Originator out of proceeds of the Mortgage. 
  
 (k) Property Conforms to Zoning Laws. The Originator has no knowledge that any improvement to the Property is in violation of any
applicable zoning law or regulation. 
  
 (l)
Property Intact. The Property is not damaged by fire, wind or other cause of loss. There are no proceedings pending or, to the best of the Originator’s knowledge, threatened, for the partial or total condemnation of the Property.

  
 (m) Improvements. Any improvements
that are included in the appraised value of the Property are totally within the Property’s boundaries and building restriction lines. No improvements on adjoining Property encroach on the Property unless the Guides permit such an encroachment.

  
 (n) Mortgage Not Usurious. The
Mortgage is not usurious and either meets or is exempt from all applicable usury laws or regulations. 
  
 (o) Compliance With Applicable Laws. The Originator and, in the case of any Mortgage which the Originator purchased, the originator
of the Mortgage and any holder of the Mortgage has complied with all Applicable Laws. 
  
 (p) Property is Insured. 
  
 (1) A property insurance policy on the Property is in effect. It is written by an insurance company satisfying the standards set forth in the Guides, in
the form required by the Guides, and provides fire and extended coverage for an amount at least equal to the amount required by the Guides. 
  
 (2) A flood insurance policy is in effect on the Property if required by the Guides. 
  
 (3) The Originator agrees to maintain, or cause to be maintained, the required insurance as long as it services the
Mortgage. Any policy mentioned in this warranty contains a standard Mortgage clause that names the Bank or Originator as Mortgagee. 
  
 (q) Mortgage is Acceptable Investment. The Originator knows of nothing involving the Mortgage, the Property, the mortgagor or the
mortgagor’s credit standing that can reasonably be expected to: 
  
 (1) cause GSEs or private institutional investors to regard the Mortgage as an unacceptable investment; 
  
 (2) cause the Mortgage to become delinquent; or 
  
 (3) adversely affect the Mortgage’s value or marketability. 
  
 (r) Mortgage Insurance or Guaranty in Force. If the Mortgage is intended to be insured or guaranteed
under the National Housing Act as amended, or under the Servicemen’s Readjustment Act of 1944 as amended, or by a contract with a Mortgage insurance company, the Originator represents that the Mortgage is so insured or guaranteed and that the
insurance or guaranty is in full force. In addition, each of the Originator and any prior holder of any interest in the Mortgage has complied with all Applicable Laws, or the insurance contract, that cover the Mortgage. 
  

 10 

 (s) Adjustable Mortgages. If the Mortgage provides that the interest rate or the
principal balance of the Mortgage may be adjusted, all of the terms of the Mortgage may be enforced by the Bank, its successors and assigns. These adjustments will not affect the priority of the lien as a first priority perfected lien against the
Property. 
  
 (t) Mortgage Assignments.

  
 (1) The Mortgage Note has been duly endorsed by the
Originator to the Bank and if the Originator shall not have originated the Mortgage, by the originator thereof and by each successive holder of such Mortgage. Each such endorsement shall be substantially in the following form: “Pay to the order
of [assignee’s name], without recourse.” 
  
 (2) The
Originator has executed and delivered to the Bank an Assignment of Mortgage, satisfying the requirements of the Origination Guide and if the Originator shall not have originated the Mortgage, the originator thereof and each successive holder of such
Mortgage has executed and delivered to the Bank, and, except for the Originator, recorded in the appropriate real estate records, an Assignment of Mortgage substantially in the form of the aforementioned Assignment of Mortgage. 
  
 (3) Each such endorsement and assignment has been duly authorized, executed
and delivered by each applicable party to each thereof and is the legal, valid and binding obligation of such party, enforceable in accordance with its terms. 
  

(4) The Originator has delivered to the Bank the Mortgage File for such Mortgage in compliance with the Origination Guide. 
  
 (5) The original Mortgage was duly recorded in the appropriate real estate
records where such recordation is necessary to perfect the lien thereof. 
  
 (u) The servicing of such Mortgage is properly held by the Originator and all notices required by Applicable Laws regarding any transfer of servicing shall have been delivered to the applicable mortgagor. The
servicing of such Mortgage by the Originator or any other servicer shall have complied with the applicable Mortgage documents and all Applicable Laws. 
  
 (v) Immediately prior to giving effect to the assignment of the Mortgage to the Bank, the Originator holds all right, title and interest
in and to the Mortgage, including, without limitation, all servicing rights with respect thereto, free and clear of all liens, encumbrances, participation interests, claims or other interests of any other person. 
  
 (w) The origination and collection practices used by the
originator of the Mortgage, the Originator and any servicer of the Mortgage have been legal, proper, prudent and customary in origination and servicing of residential first mortgage loans. 
  
 (x) The proceeds of the Mortgage have been fully disbursed.
All costs, fees and expenses incurred in making, closing or recording the Mortgage have been paid in full. 
  
 (y) There is no foreclosure proceeding pending or, to the best of the Originator’s knowledge, threatened, with respect to such
Mortgage or any Property subject thereto. 
  
 (z)
No transfer of such mortgage by any holder thereof, including (without limitation) the transfer by the Originator to the Bank was or is the subject of any bulk sale law or other similar law of any jurisdiction. 
  
 5.4. Notice of Breach. The PFI shall promptly give the Bank notice of
any breach of any representation or warranty set forth herein or incorporated herein by reference, which notice shall be in writing and shall describe in reasonable detail the nature of such breach. The PFI shall promptly provide to the Bank such
additional information regarding any such breach as the Bank shall request. 
  

 11 

 5.5. Consequences of Untrue Warranties or Representations - Purchase; Other Remedies. 

 
 (a) The Bank may require the Originator to purchase a
Mortgage if any warranty or representation made by the Originator about the Mortgage or the related Property is untrue (whether the warranty is in this Contract or any of the Guides, or was made at the Bank’s specific request). 
  
 (b) The Bank may require such purchase whether or not the
Originator had actual knowledge of the breach of warranty or representation. The Bank may also enforce any other remedy available at law or in equity. 
  
 (c) To effect the resale of such Mortgage, the Bank shall withdraw an amount equal to the repurchase price from the DID account of the PFI
at the Bank, and in the event that any such withdrawal from the PFI’s DID account shall cause the balance in such account to become negative, such deficit shall be deemed an advance under the Master Transactions Agreement between the PFI and
the Bank. The repurchase price shall be as provided in the Guides. The repurchase price shall be adjusted to reflect any premium or discount paid to or by the Bank to or from the Originator in connection with the purchase of such Mortgage but shall
not include fees paid to the Originator by the mortgagor. 
  
 5.6.
Consequences of Untrue Warranties or Representations - Termination of Contract. While untrue warranties or representations about a particular Mortgage or Property may be the basis for requiring repurchase of the particular Mortgage by the
Originator, there can be additional consequences. They may also give rise to responsibilities of the PFI under Section 5.7. In addition, untrue warranties or representations can, under certain circumstances, be treated as a breach of contract that
could result in the withdrawal of the Bank’s approval of the PFI and the termination of this Contract as set forth in Articles X and XI. 
  
 5.7. Indemnification for Breach of Warranties or Representations; Holding the Bank Harmless. If there is a breach of warranty or representation
under this Contract, the PFI agrees to indemnify, defend and hold the Bank and the other Indemnified Parties harmless from and against any related losses, damages, claims, actions, causes of action, liabilities, obligations, judgments, penalties,
fines, forfeitures, costs and expenses, including, without limitation, legal fees and expenses. Such defense shall be conducted by counsel acceptable to the Bank. 
  

	VI.	ELIGIBILITY REQUIREMENTS FOR SERVICERS 

  
 For the PFI to service Mortgages for the Bank, the PFI must satisfy the eligibility requirements specified in this article. 
  
 6.1. General Requirements. These are the general requirements the PFI
must meet to be eligible to service Mortgages for the Bank: 
  
 (a) Meet the Bank’s Standards. The PFI must have and maintain as one of its principal business purposes, the servicing of Mortgages of the type that PFI will service under this Contract. In addition, the
PFI, in the Bank’s judgment, must, at all times, have the capacity to service Mortgages for the Bank in a manner satisfying the Bank’s servicing standards and the standards generally imposed by other GSEs and private institutional Mortgage
investors. Finally, the PFI must, at all times, satisfy the applicable requirements for servicers of Mortgages set forth in the Guides. 
  
 (b) Have Qualified Staff and Adequate Facilities and Systems. The PFI must, at all times, employ personnel or agents who are well
trained and qualified to perform the functions required of the PFI, as Servicer, under this Contract. In addition, the PFI and any agents must maintain facilities and systems that are able to perform its functions as Servicer under this Contract.

  
 (c) Maintain Fidelity Bonds and Errors and
Omissions Coverage. The PFI must maintain, at its own expense, a fidelity bond and errors and omissions insurance, as required by the Guides. 
  

 12 

 (d) Report Basic Changes. The PFI must notify the Bank promptly in writing of any
material changes that occur in its principal purpose, activities, staffing, facilities, fidelity bond or errors and omissions insurance. 
  
 6.2. Ownership and Status of Servicer. In approving a PFI as Servicer, the Bank relies on the information the PFI has provided about the
eligibility, qualifications and financial status of the PFI and its owners. The PFI covenants and agrees to comply with the provisions of the Guides regarding these matters, including, without limitation, the delivery of notices regarding these
matters as required by the Servicing Guide. Changes in any such matters may affect the PFI’s eligibility to service Mortgages for the Bank. 
  
 6.3. Financial Information. In order to become and remain an approved Servicer under this Contract, the PFI must provide the financial information
required by the Guides from time to time and must satisfy the standards set forth in the Guides. 
  
 6.4. Access to PFI’s Records. As set forth in the Guides, the PFI agrees to permit, and cause its agents to permit, the Bank’s employees
and designated representatives to examine or audit books, records and information pertaining to the Mortgages. 
  

	VII.	  SERVICING MORTGAGES 

  
 This article contains the basic rules governing the servicing of Mortgages owned by the Bank (whether originated by the Originator or any other Person)
during the period that the PFI is to service such Mortgages. 
  
 7.1. Servicing Duties of the Servicer. The servicing duties of the Servicer are: 
  
 (a) Scope of Duties. The Servicer will diligently perform all duties that are necessary or incident to the servicing of all
Mortgages that the Servicer is required to service by the terms of this Contract or any other existing or future agreement between the Bank and the Servicer. 
  

(b) Mortgages to be Serviced. Any Mortgage sold by the Originator to the Bank under this Contract will be serviced by the PFI
for the Bank according to the terms of this Contract, unless, with respect to any such Mortgage, the Bank gives the PFI written notification or consent that such Mortgage will not be serviced by the PFI, whether: 
  
 (1) at the time of acquisition by the Bank, as applicable, or 

 
 (2) thereafter as a result of the PFI breaching any representation,
warranty, covenant or agreement in this Contract or the Guides. 
  
 (c) Service According to Guides. Any Mortgage serviced under this Contract must be serviced by the Servicer according to the provisions in the Guides that are in effect on the date of this Contract or as
amended in the future. This is true regardless of when: 
  
 (1)
the Mortgage was originated; 
  
 (2) the Servicer began
servicing the Mortgage. 
  
 The Servicer will also follow other
reasonable instructions the Bank gives it from time to time and shall strictly follow accepted industry standards when servicing a Mortgage for the Bank. 
  
 (d) Service at Servicer’s Own Expense. The cost of servicing will be the Servicer’s unless the Guides expressly provide
otherwise. 
  
 (e) Special Responsibilities in
Foreclosures. Among the other duties that may be assigned to the Servicer through the Bank’s special instructions or under the terms of the Guides is the responsibility to manage and appropriately dispose of Property when a Mortgage it is
servicing for the Bank has been foreclosed, or possession or title has been taken by or on behalf of the Bank. The Servicer shall manage 

  

 13 

 
and dispose of the Property according to the terms of the Mortgage (during the foreclosure process) and the Guides (both during the foreclosure process, or
the acceptance of a deed in lieu of foreclosure or other remedy, and after title to the Property has been acquired by, or on behalf of, the Bank). 
  
 (f) Service Until Need Ends. The Servicer shall service each Mortgage continuously from the date its servicing duties begin until
the earliest of: 
  
 (1) the Mortgage’s principal and
interest have been paid in full and the Mortgage shall have been canceled and a release shall have been issued to the mortgagor; 
  
 (2) the Mortgage has been liquidated and the Mortgaged Property properly disposed of (if the Servicer is required to do these things); or 
  
 (3) the Servicer’s servicing duties are terminated in accordance with
this Contract. 
  
 7.2. Compensation. 
  
 (a) The Servicer’s compensation for servicing
Mortgages, including, without limitation, the management and disposal of foreclosure properties, under this Contract is specified in the Guides. 
  
 (b) The MPF Provider may change the Servicer’s compensation by modifying the Guides at any time. However, such a
change shall not affect Mortgages that have been originated or are the subject of a Delivery Commitment issued before the date of the change. 
  
 7.3. Ownership of Records. 
  
 (a) General. All books, records and information (including, without limitation, any item in electronic form) (collectively, the
“Mortgage Records”) reasonably required to document or properly service any Mortgage owned by the Bank are the Bank’s property at all times. This is true whether or not the Servicer developed or originated them. 
  
 The Mortgage Records shall include, but are not limited to: 
  
 (1) all Mortgage documents; 
  
 (2) tax receipts; 
  
 (3) insurance policies; 
  
 (4) insurance premium receipts; 
  
 (5) ledger sheets or their electronic equivalent; 
  
 (6) payment records; 
  
 (7) insurance claim files and correspondence; 
  
 (8) foreclosure files and correspondence; 
  
 (9) current and historical data files; and 
  
 (10) all other papers, records, memoranda and electronic data. 

 

 14 

 (b) Servicer as Custodian. The Mortgage Records belong to the Bank. The Servicer
shall have possession of the Mortgage Records only with the Bank’s approval. The Servicer hereby acknowledges that it is acting as the Bank’s custodian in connection with any Mortgage Records in its possession. This is true whether the
Servicer receives the Mortgage Records from an outside source or prepares them itself. 
  
 (c) Delivery. 
  
 (1) The Servicer shall deliver to the Bank or its designee such original Mortgage Records as the Guides shall require. In addition, when the Bank asks
for any Mortgage Records in writing, the Servicer shall deliver them to the Bank or its designee. The Servicer shall also provide such Mortgage servicing information as required by the Guides. 
  
 (2) If the Bank asks the Servicer in writing for reproductions of any
Mortgage Records the Servicer or any predecessor servicer or holder of any Mortgage microfilmed, condensed or stored in electronic form, the Servicer will reproduce them in fully readable form promptly at no cost to the Bank or its designee.

  
 7.4. Agreement to Indemnify, Defend and Hold Harmless.

  
 (a) The PFI agrees to indemnify, defend and
hold the Bank and the other Indemnified Parties harmless from and against all losses, damages, claims, actions, causes of action, liabilities, obligations, judgments, penalties, fines, forfeitures, costs and expenses, including, without limitation,
legal fees and expenses, that result from (i) its failure or purported failure in any way to perform its services and duties in connection with servicing Mortgages or managing or disposing of Property according to this Contract or the Guides, or
(ii) the actual or purported willful misfeasance, bad faith or negligence of the PFI in the performance of its obligations or duties under this Contract or the Guides, or the reckless disregard of such obligations or duties. Such defense shall be
conducted by counsel acceptable to the Bank. 
  
 (b) If any Person, including, without limitation, any governmental agency, department or official, sues the Bank or any other Indemnified Party, makes a claim against the Bank or any other Indemnified Party or starts a proceeding against
the Bank or any other Indemnified Party based on the PFI’s acts or omissions, or purported acts or omissions, in servicing Mortgages or managing or disposing of Property, the PFI’s obligation to indemnify, defend and hold harmless the Bank
or any other Indemnified Parties shall be met regardless of whether the suit, claim or proceeding has merit or not. 
  
 (c) The PFI’s obligation does not apply, however, to the extent that during a suit, claim or proceeding, the Bank gives the PFI
express written instructions and solely as a result of the PFI following them an Indemnified Party suffers losses, damages, judgments or legal expenses. 
  
 7.5. PFI’s Role as Mortgage Servicer. The Servicer shall be an independent contractor and shall not be an agent for the Bank except as may be
expressly provided for in the Guides, and shall not hold itself out as an agent of the Bank. 
  

	VIII.	  ASSIGNMENT, CONSIDERATION AND CONTINUANCE 

  
 This article describes the Bank’s requirements covering assignment of, consideration for, and continuance of, this Contract. 
  
 8.1. Assignment. Because the relationships created by this Contract
are personal, the PFI may not, without the Bank’s prior written approval, assign: 
  
 (a) this Contract under any circumstances, either voluntarily or involuntarily, by operation of law, or otherwise; or 
  

 15 

 (b) its responsibility regarding the origination of Mortgages under this Contract or its
responsibility for servicing individual Mortgages owned by the Bank; or 
  
 (c) its Credit Enhancement obligations arising under Article IV of this Contract, nor may the PFI enter into or acquire any agreement to indemnify, offset, hedge or share its credit enhancement obligations, including,
without limitation, such agreements as mortgage pool insurance, reinsurance or securitizations in any form. 
  
 In any such cases, the Originator shall remain primarily responsible for (and shall not be released from) the performance of all of its obligations hereunder and shall be liable for the acts and omissions of such
other persons. In addition, the Originator shall be solely responsible for any payments due all such other persons for their services, and shall indemnify, defend and hold harmless the Bank and the other Indemnified Parties from and against all
losses, damages, claims, actions, causes of action, liabilities, obligations, judgments and expenses (including, without limitation, legal fees and expenses) relating to such services or such persons. 
  
 8.2. Limited Value of Contract to PFI. 
  
 (a) The PFI acknowledges that it has paid the Bank no
monetary consideration for making it an approved Mortgage Originator or Servicer. 
  
 (b) The PFI also agrees that, except for the sale of Mortgages, the servicing of Mortgages, or any fee for the termination of this
Contract, this Contract has no value to the PFI. 
  
 8.3.
Requirements for Continuance. The PFI’s right to continue selling and servicing Mortgages under this Contract depends on, among other things, its continuing to meet the eligibility requirements set forth in Articles II and VI of this
Contract. 
  

	IX.	ASSIGNING MORTGAGE SERVICING 

  
 The PFI may not assign its responsibility for servicing all or any part of the Mortgages that it is servicing for the Bank without first obtaining the
Bank’s written consent, which consent may be granted or withheld by the Bank in its sole discretion and may be subject to conditions specified in the Guides. 
  

	X.	BREACHES OF CONTRACT 

  
 The PFI’s taking certain actions, or failing to take certain actions, can be treated by the Bank as a breach of contract. A breach of contract can
lead to a termination of the Contract by the Bank at the Bank’s option. Termination is provided for in detail in Article XI. In addition, upon the PFI’s breach of this Contract, the Bank, at its option, may revoke the Bank’s approval
of the PFI as a Mortgage seller or servicer. 
  
 10.1 Specific
Breaches of Contract. The following constitute breaches of this Contract: 
  
 (a) Harm, Damage, Loss or Untrue Warranties. It is a breach if any act or omission of the PFI in connection with the sale of any Mortgage causes the Bank any harm, damage or loss. It is also a breach if the PFI
breaches any of the warranties set forth in Section 5.2 or sells any Mortgage to the Bank which breaches any of the warranties described in Section 5.3. 
  
 (b) Failure to Comply with this Contract or the Guides. It is a breach if the PFI does not comply with this Contract or the Guides
through any act or omission. 
  
 (c) Failure
to Properly Foreclose or Liquidate. Where a Mortgage is in default and the PFI is required or has decided to foreclose or liquidate it, it is a breach if the PFI fails to take prompt and diligent action consistent with Applicable Laws to
foreclose on or otherwise appropriately liquidate such Mortgage and to perform all incidental actions. It is a breach whether or not the failure results from the acts or omissions of an attorney, trustee or other person or entity the PFI chooses to
effect foreclosure or liquidation. 
  

 16 

 (d) Failure to Properly Manage, Dispose of, or Effect Proper Conveyance of Title.
It is a breach if any Mortgage serviced under this Contract has been foreclosed or the possession or title to the Property has been taken by or on behalf of the Bank and the PFI fails to properly manage, dispose of or effect proper conveyance of
title to the Mortgaged Property in accordance with this Contract, the Guides, any Applicable Laws or any applicable Mortgage insurance policies or contracts. 
  

(e) PFI’s Financial Ability Impaired. It is a breach if there is a change in the PFI’s financial status that, in the
Bank’s opinion, materially and adversely affects the PFI’s ability to satisfactorily sell or service Mortgages. Changes of this type include without limitation: 
  
 (1) the PFI’s insolvency; 
  
 (2) adjudication of the PFI as a bankrupt; 
  
 (3) appointment of a receiver or conservator for the PFI; or 
  
 (4) the PFI’s execution of a general assignment for the benefit of its creditors. 
  
 If any such change does take place: 
  
 (x) no interest in this Contract will be considered an asset or liability of the PFI or of its successors or assigns; and 
  
 (y) no interest in this Contract will pass by operation of law without the
Bank’s consent. 
  
 (f) Failure to Obtain
the Bank’s Prior Written Consent. It is a breach if the PFI fails to obtain the Bank’s prior written consent for: 
  
 (1) a sale or transfer (directly or indirectly) of the majority interest in the PFI; or 
  
 (2) a change in its corporate status, charter or structure. 
  
 (g) Failure to Comply with Eligibility Standards. It is a breach if the PFI fails at any time to meet
the Bank’s standards for eligible Mortgage sellers or servicers so that, in the Bank’s opinion, the PFI’s ability to comply with this Contract or the Guides is adversely affected. 
  
 (h) Court Findings against PFI or Principal Officers. It is
a breach if: 
  
 (1) a court of competent jurisdiction finds
that the PFI or any of its principal officers has committed an act of civil fraud; or 
  
 (2) the PFI or any of its principal officers is convicted of any criminal act related to the PFI’s lending or Mortgage origination, selling or servicing activities or that, in the Bank’s opinion, adversely
affects the PFI’s reputation or the Bank’s reputation or interests. 
  
 (i) Cross-Defaults. It is a breach if any default occurs under any other agreement between (1) the PFI or any affiliate of the PFI and (2) the Bank or any other Federal Home Loan Bank. 
  

 17 

 10.2. The Bank’s Rights upon Breach. 
  
 (a) If there is a breach of this Contract by the PFI, the
Bank will have the following rights: 
  
 (1) the right (but not
the obligation) to take, or permit the PFI to take, any reasonable action to have any breach corrected or cured by the PFI; 
  
 (2) the right to terminate this Contract in whole or in part; 
  

(3) the right to revoke the Bank’s approval of the PFI as an approved originator or servicer; and 
  
 (4) any other rights under this Contract or the Guides or available at law
or in equity, including, without limitation, the Bank’s rights to indemnification provided for in this Contract and the Guides. 
  
 provided, however, that the Bank shall have no obligation to take, or to permit the PFI to take, any action to correct or cure the applicable breach.

  
 (b) Any forbearance by the Bank in exercising
any of its rights will not be a waiver of any present or future right the Bank has under this Contract to so terminate it or to revoke the Bank’s approval of the PFI as an approved originator or servicer. 
  

	XI.	TERMINATION OF CONTRACT 

  
 The reasons why this Contract may be terminated and the ways in which this may be done are outlined in this article. When the Contract is terminated, the
entire relationship between the PFI and the Bank ends (with certain exceptions that are explained in this article). 
  
 11.1. Termination by Either Party of Mortgage Origination Arrangements. The provisions of this Contract covering the sale of Mortgages to the Bank
under this Contract may be terminated by the PFI or by the Bank, with or without cause, by giving notice to the other party. Notice of termination may be given at any time but must conform to Article XIII of this Contract. Termination is effective
immediately upon notice of termination, unless the notice specifies later termination. Termination will not affect any outstanding written Delivery Commitments for which the Bank has issued its written acceptance. However, if the PFI has breached
this Contract, the Bank may declare any or all outstanding Delivery Commitments and its acceptance thereof void. If the PFI or the Bank terminates this Contract in whole or in part, the Bank will not pay the PFI a termination fee. 
  
 11.2. Termination by PFI of Mortgage Servicing Arrangements. The PFI
may terminate the provisions of this Contract covering the servicing of Mortgages owned by the Bank by giving the Bank notice at any time. Notice must conform to Article XIII of this Contract. Termination is effective the last day of the third
calendar month after the calendar month in which notice is given. If the PFI terminates this Contract in whole or in part, the Bank will not pay the PFI a termination fee. 
  
 11.3. Termination by the Bank of Servicing Arrangements. The Bank may terminate the provisions of this Contract
covering the servicing under this Contract of any or all Mortgages. This may be done by following the procedures outlined below. 
  
 (a) Termination Without Cause. The Bank may terminate servicing in its sole discretion, by giving the PFI notice of the termination
and directing the PFI to transfer the servicing to a party designated by the Bank in exchange for a termination fee. The termination fee for such transfer of servicing shall be equal to the fair market value of such transfer of servicing, which
shall be mutually agreed upon by the PFI, the Bank and the designated buyer. 
  
 (b) Termination With Cause. The Bank may terminate servicing if the PFI breaches any agreement in this Contract or the Guides, including, without limitation, any of those breaches listed in Section 10.1. This
may be done by giving the PFI notice of termination. Notwithstanding anything in this Contract to the contrary, if the Bank terminates for breach, the Bank may make it effective immediately, and the Bank will not pay the PFI a termination fee or
proceeds from any sale of the servicing involved. Furthermore, the Bank will not pay a termination fee if a Mortgage is purchased by the PFI under Article V. 
  

 18 

 The provisions applicable to any such termination with or without cause, including, without limitation, the procedures
for effecting any such termination and the transfer of servicing, are set forth in the Servicing Guide. 
  
 11.4. Credit Enhancement Obligations Not Terminated. The credit enhancement obligations of the PFI under Article IV are not subject to termination
and shall survive termination of this Contract. Such obligations shall remain in full force and effect until the last of the Mortgages funded, purchased or serviced under this Contract is repaid or otherwise disposed of, unless such obligations are
earlier modified, waived or released by the Bank in writing. 
  
 11.5. Rights of Termination Not Impaired. The exercise of a right of termination under any provision of this Contract will not impair any further right of termination under another provision. 
  

	XII.	  CONTINUANCE OF RESPONSIBILITIES OR LIABILITIES 

  
 Responsibilities or liabilities of the PFI that exist before the termination of this Contract will continue to exist after termination unless the Bank
expressly releases the PFI from any of them in writing. This is true whether the Contract was terminated by the PFI or by the Bank. 
  

	XIII.	  NOTICE 

  
 13.1. General. Whenever notice is required under this Contract or by Applicable Law, it must be given as described in this article. All demands,
notices and communications under this Contract shall be in writing (except as expressly provided in Section 13.2 below) and shall be delivered in person or sent by certified United States mail, postage prepaid, return receipt requested or sent by
facsimile transmission or sent through a nationally recognized overnight delivery service, addressed at the applicable party’s address. Any such notice shall be deemed delivered upon the earlier of actual receipt and, in the case of notice by
United States mail, three Business Days after deposit with the United States post office, and in the case of notice by overnight courier, the Business Day immediately following the date so deposited with the overnight delivery service. 

 
 13.2. The Guides and Other Documents. Copies of the Guides,
including, without limitation, any amendments or supplements, or any changes or pronouncements with respect thereto, may be provided to the PFI from time to time by the Bank, at its option, either (a) by regular mail or other means, or (b)
electronically to the PFI. 
  
 13.3. Addresses. For
purposes of this Article XIII, the addresses and facsimile numbers for the Bank and the PFI (and the electronic transmission information for the PFI) are as set forth in the Addendum attached hereto. Any change must be given in writing in accordance
with the provisions of Section 13.1, but shall be effective only upon actual receipt. 
  
 13.4 Telephonic and Electronic Communications. In addition to the provisions set forth in the Guides, the PFI hereby authorizes the Bank, from time to time without notice to the PFI, to record telephonic and
other electronic communications of the PFI with the Bank. 
  

	XIV.	  PRIOR AGREEMENTS 

  
 This Contract supersedes any prior agreements between the PFI and the Bank that govern selling or servicing of Mortgages to which this Contract relates.
However, this article will not release the PFI or the Bank from any responsibility or liability under any prior agreements and understandings. 
  

	XV.	  SEVERABILITY AND ENFORCEMENT 

  
 15.1. Severability. If any provision of this Contract conflicts with Applicable Law, the other provisions of this Contract that can be carried out
without the conflicting provision will not be affected. 
  
 15.2.
Rights and Remedies Cumulative. All rights and remedies under this Contract are distinct and cumulative not only as to each other but as to any rights or remedies afforded by law or equity. They may be 

  

 19 

 
exercised together, separately or successively. Subject to Section 19.6., these rights and remedies are for the benefit of the parties and their respective
successors and assigns. 
  

	XVI.	  CAPTIONS 

  
 This Contract’s captions and headings are for convenience only and are not part of the Contract. 
  

	XVII.	  SCOPE OF CONTRACT 

  
 The following provision applies, whether or not it is contrary to other provisions in this Contract. The Bank reserves the right to restrict the
PFI’s selling or servicing of Mortgages for the Bank to the type that the PFI and its employees have the experience and ability to originate or service. 
  

	XVIII.	  OTHER PARTIES 

  
 18.1. Participants. The PFI acknowledges that the Bank may and intends to enter into one or more participation agreements with other Persons (the
“Participants”) to convey participation interests in some or all of the Mortgages acquired or serviced under this Contract. Nothing in this Contract shall prohibit such participation agreements. The PFI authorizes the Bank to
disclose to potential Participants the information used to approve the PFI as Originator, credit enhancer and Servicer and to maintain those qualifications so long as such potential Participants have agreed in writing to maintain the confidentiality
of such information. 
  
 18.2. Master Servicer; Custodian;
Underwriter; Subservicer; etc. The PFI acknowledges and agrees that from time to time the Bank may enter into agreements with other persons regarding the Mortgages. Such agreements may include master servicing agreements, custodial agreements,
underwriting agreements, subservicing agreements and other agreements for the benefit of the Bank, the Participants and their respective successors and assigns. No such other party shall owe any obligation to the PFI. To the extent the Bank assigns
or delegates any of its rights or obligations to any such other party from time to time and so notifies the PFI thereof in writing, the PFI shall be bound by such assignment or delegation. In such event, the PFI agrees that it shall not be the agent
of any such other party. 
  

	XIX.	  MISCELLANEOUS PROVISIONS 

  
 19.1. Amendment. All amendments to this Contract shall be in writing duly executed and delivered by the PFI and the Bank, except as expressly
provided in the Guides; provided, however, that the Bank may extend the period applicable to any Master Commitment without the written approval of the PFI. 
  
 19.2. REMIC, FASIT or Other Securitization or Sale Transaction. The PFI hereby acknowledges and agrees that the Bank may hereafter transfer some or
all of the Mortgages to purchasers of whole loans or into a trust or other entity, which trust or other entity may elect REMIC or FASIT status. In the case of any such transfer (whether or not such entity elects REMIC or FASIT status), (a) the Bank
may assign to the transferee the Bank’s rights under this Contract in respect of the Mortgages so transferred and upon such assignment, the transferee shall be entitled to all rights of the Bank under this Contract in respect of such Mortgages,
except to the extent provided otherwise in the transfer agreement between the Bank and such transferee, (b) the PFI will comply with all applicable REMIC or FASIT legal and regulatory requirements in connection with the performance of its
obligations and the exercise of its rights hereunder, and (c) upon the request of the Bank, the PFI shall provide all information reasonably required and otherwise cooperate with the Bank, any applicable rating agencies and any prospective
transferees or investors in connection with any such securitization or sale of any or all of the Mortgages and shall enter into such amendments to this Contract as the Bank shall reasonably request to effectuate the provisions of this Section 19.2.

  
 19.3. Governing Law. The parties acknowledge that the
MORTGAGE PARTNERSHIP FINANCE Program is or will be offered to participating financial institutions in numerous states, that the MPF Provider will be 

  

 20 

 
providing services to the Bank, the PFI and all participating financial institutions wherever located, and that this Contract will be performed in part in
the State of Illinois because of the services to be provided by the MPF Provider to, or on behalf of, the Bank. THEREFORE THE PARTIES AGREE THAT THIS CONTRACT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE LAWS (AND NOT THE
CONFLICTS LAW) OF THE STATE OF ILLINOIS APPLICABLE TO AGREEMENTS TO BE PERFORMED IN THE STATE OF ILLINOIS. Any action or proceeding to enforce or interpret this Contract shall be brought in the state or federal court for the county and state
where the Bank is located, and if any basis for federal jurisdiction exists in such action or proceeding, it must be brought in the federal court for such state and county. 
  
 19.4. Intention of the Parties. It is the intention of the parties hereto that this Contract does not create a joint
venture or partnership between the PFI and the Bank, but rather this Contract constitutes a contractual arrangement between the parties. The Bank shall not be obligated to purchase any particular Mortgage unless and until it formally commits in
writing to do so. 
  
 19.5 Confidentiality of Proprietary
Information. The PFI agrees to maintain the confidentiality of any information provided by the Bank or the MPF Provider which is labeled “confidential” or “proprietary information” or otherwise transmitted as confidential
information and not disclose such information except to employees who have a need to know its contents and to third party agents who have a need to know and have signed confidentiality agreements protecting the Bank. It is understood that such
information will not be considered confidential if (a) it is or becomes publicly available through no breach of the PFI’s obligations under this Contract, (b) it is provided by the Bank to any third Person without restriction on disclosure, (c)
it is provided to the PFI by a third Person who properly has such information, without restriction on disclosure and without breach by such third Person of any nondisclosure obligation it may have, or (d) it is independently developed by the PFI
without use of the Bank’s information. If the PFI is served with process or any other governmental or regulatory request for such confidential information, the PFI shall immediately notify the Bank’s General Counsel, or if the Bank has no
General Counsel, the Bank’s President, prior to complying with such process or request, except where such prior notice is prohibited by law. 
  
 19.6. Successors and Assigns. This Contract will inure to the benefit of and be binding upon the parties hereto and their respective successors and
assigns; provided, however, that the foregoing provision shall not be deemed to permit the assignment by the PFI of any of its rights or obligations hereunder in violation of this Contract. 
  

 21 

 19.7. Conflict with Guides. In the event of any conflict between the provisions of this Contract
and the provisions of the Guides, the latter shall prevail unless this Contract expressly provides otherwise. 
  

	XX.	  SIGNATURES 

  
 By executing this Contract, the PFI and the Bank agree to all of this Contract’s terms and provisions. Both the PFI and the Bank have executed and
delivered and dated this Contract below. 
  
 This Contract takes
effect on the date this Contract has been executed and delivered by both the PFI and the Bank. 
  

			
	 THE PFI:

		
	 By:
	 	 
	 Name:
	 	 
	 Title:
	 	 
	
	 THE BANK:

	
	 FEDERAL HOME LOAN BANK OF CHICAGO

		
	 By:
	 	 
	 Name:
	 	 
	 Title:
	 	 
		
	 By:
	 	 
	 Name:
	 	Timothy J. Maloney
	 Title:
	 	Vice President

  
 Customer
No.                     
  

 22 

 ADDENDUM 
  

Address and Other Contact Information 
  
 The Bank: 
  
 Address: 
  
 The Federal Home Loan Bank of Chicago 
 111 East Wacker Drive 
 Suite 800 
 Chicago, Illinois 60601 
 Attention:
MORTGAGE PARTNERSHIP FINANCE ® Group 
 Facsimile No.: (312) 565-5855 
  

Electronic Transmission: 
 Kgould@fhlbc.com 
  
 The PFI:

  
 Address: 
 La Salle Bank National Association 
 c/o ABN AMRO Mortgage Group Inc. 
 777 East Eisenhower Parkway, suite 700 
 Ann Arbor, Michigan 48108 

 
 Attention of: Karen Jackson, Counsel 
  
 Facsimile Number for Notices: 734-997-2866 
  
 Electronic Transmission: 
 Karen.Jackson@abnamro.com 
  
 [List authorized persons, their respective roles, their addresses, e-mail addresses, telephone numbers and facsimile numbers.] 
  

 23MPF Investment & Service Agreement between FHLB Pittsburgh and FHLBC

 EXHIBIT 10.5 
  
 MORTGAGE PARTNERSHIP FINANCE® 
 SERVICES AGREEMENT

  
 This MORTGAGE PARTNERSHIP FINANCE (“MPF®”) Services Agreement (the
“Agreement”) is entered into as of the 30th day of April, 1999 and is executed by the FEDERAL HOME LOAN BANK OF PITTSBURGH (the “Pittsburgh Bank”), a corporation of the United States of America, having its principal office at 601
Grant Street, Pittsburgh, Pennsylvania 15219, and the FEDERAL HOME LOAN BANK OF CHICAGO (the “MPF Provider”), a corporation of the United States of America, having its principal office at 111 East Wacker Drive, Suite 700,
Chicago, Illinois 60601. 
  
 RECITALS: 
  
 WHEREAS, the MPF Provider and Pittsburgh Bank are Federal Home
Loan Banks (“FHLBs”) established under the authority of the Federal Home Loan Bank Act, 12 U.S.C. § 1421 et seq., to carry out a housing finance mission which includes supporting mortgage finance in a safe and sound manner;

  
 WHEREAS, in support of its housing finance mission, the
MPF Provider has developed the MPF Program, a financial services product whereby an FHLB funds or purchases residential mortgage loans (“Mortgage Loans,” and individually a “Mortgage Loan”) through
or from members of the MPF Provider, pursuant to separate Participating Financial Institution Agreements (“PFI Agreements”) with each participating member; 
  
 WHEREAS, the Pittsburgh Bank wishes (i) to fund Mortgage Loans through its own members who pursuant to the
MPF Program will be acting as agent for the Pittsburgh Bank in closing such Mortgage Loans, (ii) to purchase Mortgage Loans from its own members, and (iii) to have the MPF Provider operate and maintain the
MPF Program for the benefit of the Pittsburgh Bank and any other FHLBs that are or may desire to participate in the MPF Program, including providing support services for the Pittsburgh Bank’s participation in the
MPF Program; and 
  
 WHEREAS, the
MPF Provider is agreeable to making the MPF Program available to the Pittsburgh Bank so that it can be offered to the Pittsburgh Bank’s members, and is willing to operate and maintain the MPF Program
for the benefit of the Pittsburgh Bank and other FHLB participants in the MPF Program, subject to the terms and conditions set forth in this Agreement; and 
  
 WHEREAS, the parties contemplate entering into a participation pooling arrangement with other FHLBs whereby each FHLB that
joins in the arrangement will contribute participation interests in MPF assets to a pool and in return will receive a pro rata interest in the total pool of participation interests; such arrangement is expected to supplement
rather than supersede this Agreement. 

 NOW THEREFORE, in consideration of the foregoing recitals, for other good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged and the mutual covenants and conditions herein contained, the parties hereto hereby agree as follows: 
  

ARTICLE I  
 CERTAIN
DEFINITIONS 
  
 As used herein, the following terms shall have
the following respective meanings: 
  
 “Additional
Participation Fee” shall mean fees payable to certain MPF Banks by the MPF Provider that are subject to the limit that the cumulative amount of Additional Participation Fees paid to all MPF Banks
shall not exceed the Program Contribution Fund. 
  
 “Agency
Loan” shall mean a Mortgage Loan which is originated by a member of a FHLB as agent for that FHLB under the MPF Program, and which is therefore owned by such FHLB from the moment of its origination. 
  
 “Borrower” shall mean the obligor or obligors under any Mortgage
Loan. 
  
 “Business Day” shall mean any day that the
MPF Provider is open for business. 
  
 “Clearing Account” shall mean the Pittsburgh Bank’s Daily Investment Deposit (DID) account or accounts at the MPF Provider, pursuant to the MPF Provider’s standard agreement for such
account(s) from time to time, for the clearing of debits and credits between the MPF Provider and the Pittsburgh Bank. 
  
 “Closed Loan” shall mean a Mortgage Loan that was owned by a PFI prior to the sale of the Mortgage Loan to a FHLB under the MPF
Program. 
  
 “Custodian” shall mean, at any time, the
custodian utilized by the MPF Provider under the MPF Program to hold the Mortgage Loan Documents pertaining to the Program Loans. 
  

“Default Rate” shall mean a rate equal to the then current 10 year U.S. Treasury note rate. 
  
 “Designated Loans” shall have the meaning set forth in Section
7.1.1. 
  
 “Event of Default” shall have the meaning set
forth in Section 7.2. 
  
 “Fair Market Value” shall mean
the current value of a given group of Mortgage Loans as determined by the MPF Provider obtaining bids or quotes on a given day, taking into consideration any delinquencies and assuming that the Pittsburgh Bank’s obligations under
Section 7.4. will benefit and be enforceable by the MPF Provider. The bids or quotes will be obtained from three leading participants in the market for mortgage backed securities of a similar type to the Mortgage Loans and the
determined value will be the average of the three bids or quotes. The three participants to be contacted shall be agreed upon by both the MPF Provider and the Pittsburgh Bank. 
  

 -2- 

 “FHLB Guide” shall mean the Guide for the MPF Banks published by the
MPF Provider detailing policy and procedures for MPF Bank participation in the MPF Program, as the same may be amended from time to time, and which is hereby incorporated by reference in this Agreement.

  
 “Guides” shall mean, collectively, the Origination
Guide and the Servicing Guide promulgated by the MPF Provider for the MPF Program, as revised from time to time. 
  
 “Initial Term” shall have the meaning set forth in Section 2.1. 
  
 “Later FHLBs” shall mean those FHLBs that sign agreements substantially in the form of this Agreement to offer the
MPF Program except for the Pittsburgh Bank and the Federal Home Loan Bank of New York (“FHLB New York”). 
  
 “Master Commitment” shall mean an agreement between an MPF Bank and its participating member pursuant to which the member agrees
to originate Agency Loans or sell Closed Loans for or to such MPF Bank and service such Mortgage Loans thereafter, in accordance with the Guides. 
  

“Master Servicer” shall mean, at any time, the entity utilized by the MPF Provider as the master servicer of Program Loans.

  
 “Mortgage” shall mean, for any Mortgage Loan, the
mortgage, deed of trust or other security documents executed and delivered by the applicable Borrower as security for such Mortgage Loan. 
  
 “Mortgage Loan Documents” shall mean, for any Mortgage Loan, the Mortgage Note, the Mortgage and all other documents evidencing or securing such
Mortgage Loan, as the same may be amended, supplemented, modified or restated from time to time. 
  
 “Mortgage Note” shall mean, for any Mortgage Loan, the promissory note of the Borrower evidencing such Mortgage Loan. 
  
 “MPF Banks” shall mean the Pittsburgh Bank and any
other FHLB that has entered into an agreement with the MPF Provider to offer the MPF Program to their respective members. 
  
 “MPF Program” shall mean the MORTGAGE PARTNERSHIP FINANCE® Program of the MPF Provider, which is based upon the
Guides, the PFI Agreements and the Master Commitments. 
  
 “MPF System” shall mean the proprietary software developed or owned by the MPF Provider for funding and purchasing Program Loans through or from PFIs, but does not include any software or models
licensed to the MPF Provider by third parties. 
  

 -3- 

 “PFIs”, and individually, a “PFI” shall mean a member of the MPF Bank
that elects to participate in the MPF Program by executing a PFI Agreement with the MPF Bank. 
  
 “Program Contribution” shall mean the fee payable by a FHLB to the MPF Provider for the right to offer the MPF
Program to its members. The amount of the Pittsburgh Bank’s Program Contribution is set forth in Section 2.2. 
  
 “Program Contribution Fund” shall mean at any time, an amount equal to 20% of the aggregate amount of Program Contributions paid or imputed to
be paid by Later FHLBs, less the Regular Participation Fees and Additional Participation Fees previously paid by the MPF Provider to the Pittsburgh Bank and FHLB New York. 
  
 “Program Loans”, and individually a “Program Loan”, shall mean Agency Loans or Closed Loans funded or
purchased under the MPF Program. 
  
 “Regular
Participation Fee” shall mean a fee paid to certain MPF Banks by the MPF Provider without limitation as to the source of funds from which to make such payments, in the amount described in Section 2.4. 

 
 “Servicer” shall mean, for any Program Loan, the PFI acting in
its capacity as a servicer, or any subsequent servicer of such Mortgage Loan for the Pittsburgh Bank under the applicable Servicing Agreement. 
  
 “Servicing Agreement” shall mean the PFI Agreement entered into between a PFI and the Pittsburgh Bank, pursuant to which the PFI agrees to
service Program Loans for the account of the Pittsburgh Bank, and in the event that servicing for any Program Loan is transferred to some other party, the agreement pursuant to which such Program Loan is serviced for the account of the Pittsburgh
Bank. 
  
 “Term” shall mean the Initial Term and any
renewed periods that are exercised as provided in Section 2.1, unless terminated earlier as provided in this Agreement. 
  
 “Termination Event” shall mean any of the following: (a) a court of competent jurisdiction determines that the FHLBs do not have the authority
to offer the MPF Program, which would include, without limitation, an adverse ruling in Texas Savings & Community Bankers Assoc., et al. v. Federal Housing Finance Board, Case No. A 97 CA 421SS (W. Dist. Texas); (b) the
Federal Housing Finance Board (“Finance Board”) orders or otherwise causes the MPF Banks to stop offering the MPF Program or otherwise never approves the Pittsburgh Bank’s participation in the
MPF Program; (c) legislation is enacted which withdraws the FHLBs authority to offer the MPF Program; or (d) the MPF Program is conclusively determined to violate consumer or other federal or relevant
state laws or otherwise does not comply with applicable law. 
  
 Other terms used herein shall be defined as set forth in this Agreement. Any capitalized term used herein which is not so defined shall have the meaning ascribed to such term in the Guides. Terms referring to time periods, such as months or
years, unless otherwise defined herein shall mean calendar periods, such as a calendar month or calendar year. 
  

 -4- 

 ARTICLE II  
 TERM AND FEES 
  
 2.1.
Term of Agreement. The initial term of this Agreement shall be three (3) years from the date the Finance Board grants approval of the Pittsburgh Bank’s request to offer the MPF Program (“Initial Term”). At the
expiration of the Initial Term, the Pittsburgh Bank shall have the right to renew the Agreement for an additional one year term. At the expiration of the one year renewal, the Pittsburgh Bank shall have the right to renew the Agreement for a
three-year term upon payment of the Extension Fee set forth in Section 2.2. To exercise any of its renewal rights the Pittsburgh Bank must give the MPF Provider written notice of its intention to renew this Agreement at least ninety
(90) days prior to the renewal period. The MPF Provider shall use its best efforts to notify the Pittsburgh Bank of its renewal option at least one hundred twenty (120) days prior to each renewal period. If the Pittsburgh Bank fails
to exercise all of its renewal rights, the Pittsburgh Bank shall promptly return to the MPF Provider all marketing and confidential materials previously provided by the MPF Provider, unless continuing use of said
materials is licensed to the Pittsburgh Bank. 
  
 2.2. Program
Contribution and Extension Fee. To obtain the right to offer the MPF Program, the Pittsburgh Bank shall pay the MPF Provider a one time Program Contribution in the amount of $750,000. The Pittsburgh Bank has already
paid a first installment in the amount of $250,000. The remaining $500,000 shall be paid upon the execution of this Agreement. No additional Program Contribution shall be due on any renewal or extension of the Term of this Agreement except that an
Extension Fee in the amount of $750,000 shall be payable by the Pittsburgh Bank to exercise the three-year renewal term that follows the one-year renewal period. 
  
 2.3. Exit Fee. If the Pittsburgh Bank elects not to renew the Agreement for either the one-year renewal period or the
three-year renewal period that follows the one-year renewal period, then provided that (i) the Pittsburgh Bank has funded $1 Billion or more in Program Loans, (ii) no Event of Default attributable to the MPF Provider has occurred, and
(iii) no Termination Event has occurred, the Pittsburgh Bank shall pay an Exit Fee in the amount of $500,000 to the MPF Provider on the next Business Day following the expiration of the one-year renewal period or three-year renewal
period, whichever may apply. 
  
 2.4. Participation Fees.

  
 (a) The MPF Provider shall pay, if applicable,
a Regular Participation Fee and, if applicable, an Additional Participation Fee, each month (x) during the Term, of this Agreement, and (y) if any renewal options are not exercised, then during the Term plus a period of ten (10) years, in an
amount determined in accordance with the schedule listed below, such payment to be credited to the Pittsburgh Bank’s Clearing Account not later than the fifth Business Day of the next succeeding month. The amount of each Regular or Additional
Participation Fee shall be 
  

 -5- 

 dependent upon the aggregate amount of all the Program Loans funded and outstanding at the end of the month by all the
FHLBs (including the MPF Provider) and calculated based on the portion of the Program Contribution previously paid by the Pittsburgh Bank in cash, as follows: 
  
 (i) If the aggregate amount of outstanding Program Loans is less than $2 Billion, no Regular Participation
Fee shall be paid but an Additional Participation Fee in an amount equal to 1.2500 % the Pittsburgh Bank’s Program Contribution shall be paid, to the extent of the funds available for such payment as provided in Section 2.4.(b); 
  
 (ii) If the aggregate amount of outstanding Program Loans is
at least $2 Billion but less than $3 Billion, a Regular Participation Fee in an amount equal to 0.4167 % of the Pittsburgh Bank’s Program Contribution shall be paid, plus an Additional Participation Fee in an amount equal to 0.8333 % the
Pittsburgh Bank’s Program Contribution, to the extent of the funds available for such payment as provided in Section 2.4.(b); 
  
 (iii) If the aggregate amount of outstanding Program Loans is at least $3 Billion but less than $5 Billion, a Regular Participation Fee
shall be paid in an amount equal to 0.8333 % of the Pittsburgh Bank’s Program Contribution, plus an Additional Participation Fee in an amount equal to 0.4167 % of the Pittsburgh Bank’s Program Contribution, to the extent of the funds
available for such payment as provided for in Section 2.4.(b); 
  
 (iv) If the aggregate amount of outstanding Program Loans is at least $5 Billion but less than $7 Billion, a Regular Participation Fee in an amount equal to 1.2500 % of the Pittsburgh Bank’s Program Contribution;

  
 (v) If the aggregate amount of outstanding
Program Loans is at least $7 Billion but less than $10 Billion, a Regular Participation Fee in an amount equal to 1.6667 % of the Pittsburgh Bank’s Program Contribution; 
  
 (vi) If the aggregate amount of outstanding Program Loans is $10 Billion or more, a Regular Participation
Fee in an amount equal to 2.0833 % of the Pittsburgh Bank’s Program Contribution. 
  
 (b) In determining the amount of Additional Participation Fees under clauses (i), (ii) and (iii) above, the amount payable to the Pittsburgh Bank in any given month shall be limited to its then current pro rata
share of the Program Contribution Fund. 
  
 (c) No Regular or
Additional Participation Fees shall be payable under this Section 2.3 from and after the date the Pittsburgh Bank’s entire Program Contribution is refunded under Section 7.3 to the Pittsburgh Bank. 
  
 2.5 Transaction Services Participation. The parties acknowledge that
the MPF Provider will provide transaction processing services to the Pittsburgh Bank in connection with the 
  

 -6- 

 Pittsburgh Bank’s funding and purchasing Program Loans, such services to include recording Master Commitments,
completing Delivery Commitments, maintaining credit enhancement and funding records, custodial services, administration of vendor agreements, data processing, servicing oversight, quality control and support of future product enhancements. In
consideration of the transaction processing services necessary to the funding, purchasing and holding of Program Loans, the Pittsburgh Bank hereby agrees to grant the MPF Provider a twenty-five percent (25%) participation interest in
each Program Loan the Pittsburgh Bank funds or purchases under the MPF Program during the Term of this Agreement (“Transaction Services Participation”), and the MPF Provider agrees to acquire the Transaction
Services Participation, provided, however, that the Transaction Services Participation or any other participation interest shall be set for each Master Commitment and may not be changed for that Master Commitment once Program Loans have been funded
or purchased thereunder with the exception of interests created in Designated Loans. The Transaction Services Participation will be granted and acquired pursuant to the terms of a separate MPF Pro Rata Participation Agreement in a
form mutually acceptable to the parties. None of the foregoing provisions shall prevent the parties from entering into participation arrangements with respect to Program Loans in addition to those provided for in this Agreement. 
  
 ARTICLE III  
 TRAINING AND SALES SUPPORT 
  
 3.1. Training of Pittsburgh Bank Personnel. 
  
 3.1.1. Sales Training. During the first three months of the Initial Term, the MPF Provider will provide a four week
sales training course (“Sales Training”) for up to five of the Pittsburgh Bank’s employees but to no more than two employees at any one time. The Sales Training shall take place at the offices of the MPF Provider which
will provide cubicles and access to computers, along with appropriate training materials and classroom instruction to the trainees. The dates for Sales Training shall be scheduled by mutual agreement. Sales Training shall cover the following topics:

  

	 	1.	Overview of the MPF Program and its systems and models. 

  

	 	2.	Handling sales and installation calls and meetings with the management of potential PFIs. 

  

	 	3.	Completing PFI Agreements and Master Commitments. 

  
 The Pittsburgh Bank shall be responsible for preparing its employees for the Sales Training by providing training in the basics of the mortgage business
prior to the Sales Training or by selecting employees with adequate experience in the mortgage finance business. The Pittsburgh Bank shall pay all travel and lodging expenses of its employees in connection with their attending Sales Training. If the
MPF Provider’s staff should make any joint sales calls with Pittsburgh Bank employees to any Pittsburgh Bank members, 
  

 -7- 

 the Pittsburgh Bank will pay all travel and lodging expenses of the MPF Provider’s
staff in making such joint sales calls, except for the first $2,500.00 of such expenses which shall be paid by the MPF Provider. 
  
 3.1.2. Operations Training. During the first year of the Initial Term, the MPF Provider will provide a two week
operations training course (“Operations Training”) for up to five, but no more than two at a time, of the Pittsburgh Bank’s employees. The Operations Training shall take place at the offices of the MPF Provider which
will provide cubicles and access to computers, along with appropriate training materials and classroom instruction to the trainees. The dates for Operations Training shall be scheduled by mutual agreement. Operations Training shall cover the
following topics: 
  

	 	1.	Funding and purchasing Loans under the MPF Program. 

  

	 	2.	Servicing, Quality Control and Reporting. 

  
 The Pittsburgh Bank shall be responsible for selecting employees with adequate knowledge of the Pittsburgh Bank’s operations and systems, as well as
residential mortgage operations. The Pittsburgh Bank shall pay all travel and lodging expenses of its employees in connection with their attendance at Operations Training. 
  
 3.1.3. Follow-Up Training on Location. The MPF Provider will provide follow-up
training to the Pittsburgh Bank’s trainees at the Pittsburgh Bank’s premises for up to three (3) person days per month (or such greater number as may be acceptable to the MPF Provider) for three (3) months following the
Sales Training and Operations Training. The Pittsburgh Bank shall pay all reasonable travel and lodging expenses of the MPF Provider’s employees in connection with the provision of such follow-up training. The MPF
Provider shall supply additional operations training or sales assistance as requested by the Pittsburgh Bank, at times to be mutually agreed upon, at a cost to the Pittsburgh Bank of $750 per day plus all travel and lodging expenses of the
MPF Provider’s staff providing such training or assistance. 
  
 3.2. On Going Technical and Sales Support. Within thirty (30) days after completion of the Sales Training and Operations Training, the MPF Provider will establish a system or method for
electronic and telephonic communications with the Pittsburgh Bank sufficient to allow the Pittsburgh Bank’s personnel to have access to the MPF Provider’s MPF Program personnel that is equivalent to the access
available to the MPF Provider’s own Banking Group and MPF Program Marketing function. The Pittsburgh Bank shall cooperate with the MPF Provider in setting up this communications method or system. As
soon as practicable after the execution of this Agreement, the MPF Provider will cause the Guides to be published in an electronic format generally accessible to the MPF Banks and their PFIs. 
  

 -8- 

 ARTICLE IV  
 OPERATIONAL SYSTEMS 
  
 4.1. Systems Support. The MPF Provider shall work with the Pittsburgh Bank to develop an appropriate interface or method for receiving reports from the MPF Provider. Data regarding the Pittsburgh
Bank’s PFIs and the Mortgage Loans the Pittsburgh Bank has funded or purchased, and that are serviced by its PFIs will be processed on the same system the MPF Provider uses to process the MPF Provider’s
MPF Program data. The MPF Provider intends to update this system as it deems necessary to keep the system operating in a commercially reasonable manner. 
  
 4.2. Deliverables. The MPF Provider shall provide the following reports, inquiry capabilities, and
electronic data transmission to the Pittsburgh Bank or its PFIs, as applicable: 
  
 4.2.1. PFI Reports. Subject to the timely receipt of accurate data from the Pittsburgh Bank, the MPF Provider shall
transmit the same reports to the Pittsburgh Bank’s PFIs as the MPF Provider supplies to the MPF Provider’s PFIs. These reports are generally described in the Guides. Any supplemental reports will be made
available to the Pittsburgh Bank’s PFIs in the same way that they are made available to the MPF Provider’s PFIs. 
  
 4.2.2. Management Reports. The MPF Provider shall provide such reports to the Pittsburgh Bank as are described and
with the frequency set forth in the FHLB Guide. 
  
 4.2.3. On-Line Inquiry. Access to certain information in the MPF System will be made available through on-line inquiry by the Pittsburgh Bank. The method for making inquiry and the nature of the available data is set
forth in the FHLB Guide. 
  
 4.2.4. Electronic
Data Transmission. Certain accounting and PFI transaction account data shall be transmitted by the MPF Provider to the Pittsburgh Bank the evening of each Business Day to enable the Pittsburgh Bank to post such data to its general
ledger and to the Pittsburgh Bank’s PFIs’ transaction clearing accounts with the Pittsburgh Bank. The method for transmission will be developed with the cooperation of the Pittsburgh Bank and the specific types of data to be transmitted is
set forth in the FHLB Guide. 
  
 4.2.5.
Implementation. The MPF Provider and the Pittsburgh Bank have prepared an implementation schedule to govern the initiation and testing of the various deliverables described in this Agreement. This schedule includes dates for
training the Pittsburgh Bank’s personnel. Both the MPF Provider and the Pittsburgh Bank shall diligently work to implement the installation and training in the agreed upon time frame. The parties recognize that the implementation
schedule represents a best estimate of the time and actions needed to be taken rather than a precise prediction, and therefore, that such implementation schedule is subject to modification as needed to deal with unforeseen circumstances. 

 

 -9- 

 4.2.6. Penalties For Delayed Implementation. The MPF Provider shall
make all the capabilities described in Sections 4.1. and 4.2. available for testing by the Pittsburgh Bank not later than four months after the date this Agreement is executed. Should the MPF Provider fail to make these capabilities
available within the six month period following execution of this Agreement, the Pittsburgh Bank’s Program Contribution shall be reduced by $100,000 for each ninety (90) day period or part-thereof in which such capabilities are not made
available past the initial six month period. 
  
 4.3. Program
Enhancements. 
  
 4.3.1. System
Review. The MPF Provider shall hold periodic meetings, at least once a quarter during 1999, to discuss possible changes and enhancements to the MPF Program system and to prioritize the scheduling of any such
enhancements. Such meetings will be open to all FHLBs participating in the MPF Program, who can attend in person or telephonically. 
  
 4.3.2. Customized Enhancements. For the first six (6) months after the Pittsburgh Bank’s first Mortgage Loan is funded or
purchased through the MPF Program it may not request enhancements to the MPF Program system that would be solely for the benefit of the Pittsburgh Bank (“Customized Enhancements”). Thereafter, the Pittsburgh
Bank may request Customized Enhancements to be made by the MPF Provider. The MPF Provider shall develop any Customized Enhancements requested by the Pittsburgh Bank provided that such Customized Enhancements do not
negatively impact the performance or operation of the MPF Program system for other MPF Banks. The MPF Provider shall promptly advise the Pittsburgh Bank of its estimate of the cost and anticipated billing
schedule, and the time period necessary to develop such Customized Enhancements. Commencement of work on any Customized Enhancements is subject to the Pittsburgh Bank’s acceptance of the estimates provided by the MPF Provider.
The Pittsburgh Bank will reimburse the MPF Provider for the MPF Provider’s costs and expenses to develop any Customized Enhancements as provided for in the FHLB Guide, such payment to be made by the
MPF Provider debiting the Pittsburgh Bank’s Clearing Account. The MPF Provider shall provide progress reports with its statement of development costs and expenses. The MPF Provider shall use its best
efforts to develop Customized Enhancements for not more than the estimated cost and within the expected time frame. However, the MPF Provider does not guarantee that any Customized Enhancements can be developed or, if they can be
developed, what the final cost will be or how long it may take to do so. The Pittsburgh Bank may request the MPF Provider to cease development of Customized Enhancements at any time but shall remain liable for all costs and expenses
(including uncancellable contracts) incurred by the MPF Provider up to the date it receives such request to cease its development activities. Any Customized Enhancement with an estimated cost greater than $50,000 shall be developed
pursuant to a separate development agreement between the MPF Provider and the Pittsburgh Bank. 
  

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 4.3.3. Reimbursement by Other FHLBs. If, during any Term of this Agreement, other
FHLBs adopt any Customized Enhancements paid for by the Pittsburgh Bank, the Pittsburgh Bank will be reimbursed for a portion of the development costs of such Customized Enhancements in accordance with the following formula: 
  
 RA = (CE x 1.15) / Participating FHLBs 
  
 In the above formula, “RA” means the reimbursement amount due from
each FHLB that adopts the Customized Enhancements; “CE” means the cost of the Customized Enhancement; and “Participating FHLBs” means the number of FHLBs participating in the MPF Program at the time of the
development request (including the Pittsburgh Bank and the MPF Provider). Customized Enhancements shall no longer be considered “Customized Enhancements” on the third anniversary of their acceptance by the MPF
Bank that requested such enhancements. 
  
 ARTICLE V 

 PARTICIPATION IN MPF PROGRAM 
  

5.1 MPF Provider to Act as Custodian for MPF Program Loans. 
  
 (a) The MPF Provider shall act as the custodian for the
Pittsburgh Bank with respect to all Mortgage Loans funded or purchased by the Pittsburgh Bank pursuant to the MPF Program. The MPF Provider may discharge this duty by entering into a custody agreement (a “Custody
Agreement”) with Norwest Bank Minnesota, N.A. or any other entity which the MPF Provider deems qualified to act as the Custodian. The Custodian shall at all times be a federal or state chartered bank or trust company authorized
to transact business in all applicable jurisdictions, and maintain customary fidelity and other insurance in connection with the performance of its obligations under the Custody Agreement and, upon request, provide an officer’s certificate
certifying that such policy or coverage is in full force and effect. The MPF Provider shall have direct and primary responsibility to the Pittsburgh Bank for the performance of the duties of the Custodian under the Custody Agreement.

  
 (b) The MPF Provider shall perform or cause the
Custodian to perform the following custodial duties for the Pittsburgh Bank’s Program Loans, which shall be done in compliance with the provisions of the PFI Agreements and the incorporated Guides: 
  
 (i) To hold the Mortgage Loan Documents and any other documents or papers
relating to the Mortgage Loans which come into the Custodian’s possession (the “Custodial Files”) for the benefit of, and as an agent for and bailee of, the Pittsburgh Bank and to maintain continuous custody of all Custodial Files in
accordance with customary standards for such custody; 
  
 (ii) To
review the documents received with respect to a Mortgage Loan to determine whether they comply with the requirements of the Origination Guide; 
  

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 (iii) To work with the applicable PFI to resolve any exceptions to said requirements; 
  
 (iv) To provide exception reports and status reports regarding Mortgage Loan
Documents as provided for in the FHLB Guide; 
  
 (v) Upon the
payment in full or the purchase or repurchase by a PFI of a Mortgage Loan, or as needed for servicing or foreclosure purposes, to release the Mortgage Loan Documents to the Servicer or notify the Servicer that the Mortgage Loan Documents are no
longer held by the Custodian; and 
  
 (vi) To maintain or cause
the Custodian to maintain customary fidelity and other insurance in connection with the performance of the obligations under the Custody Agreement and, upon request, to provide an officer’s certificate certifying that such policy or coverage is
in full force and effect. 
  
 As part of its custodial duties hereunder, the
MPF Provider, for the benefit of the Pittsburgh Bank, shall use its best efforts to enforce the obligations of the Custodian under the Custody Agreement. Such enforcement shall be in such form and carried out to such an extent and at
such time as the MPF Provider, in its good faith business judgment, would require if it were the owner of the related Mortgage Loans. Notwithstanding the terms of any Custody Agreement, no delegation of custodial obligations to the
Custodian pursuant to such Custody Agreement shall relieve the MPF Provider from its custodial obligations hereunder, and the MPF Provider shall remain obligated and primarily liable to the Pittsburgh Bank for the
custody of the Mortgage Loans in accordance with the provisions of this Agreement. 
  
 (c) In the event that the Custodian fails to produce a Mortgage Loan Document that was in its possession pursuant to the Custody Agreement when requested by the Servicer, and provided that (i) the Custodian previously
acknowledged in writing that it had possession of such Mortgage Loan Document, (ii) such Mortgage Loan Document is not outstanding pursuant to a prior request for release from the Servicer, and (iii) such Mortgage Loan Document was held by the
Custodian on behalf of the Pittsburgh Bank (a “Custodial Delivery Failure”), then the MPF Provider shall, with respect to any missing Mortgage Loan Document, furnish or cause the Custodian to furnish a lost Mortgage Loan
Document affidavit in a form reasonably satisfactory to the Pittsburgh Bank and to indemnify (such indemnification to survive any termination of the Custody Agreement) the Pittsburgh Bank and the Servicer, and their respective designees, harmless
against any and all direct liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements, including reasonable attorneys’ fees, that may be imposed on, incurred by, or asserted against it or
them in any way relating to or arising out of such Custodial Delivery Failure, provided that neither the MPF Provider nor the Custodian shall be liable for consequential damages. 
  
 (d) The MPF Provider shall immediately forward from the
Custodian, or cause the Custodian to deliver to the Pittsburgh Bank, periodic reconciliation reports applicable to the Pittsburgh Bank’s Program Loans regarding Mortgage Loan Documents received and the status of requests for unreconciled or
missing documents as provided in the FHLB Guide. The Custodian shall acknowledge that it holds the Mortgage Loan Documents pertaining to Mortgage Loans owned or held by the Pittsburgh Bank which come into its possession for the benefit of the

  

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 Pittsburgh Bank, and shall dispose of the same only in accordance with instructions furnished by the MPF
Provider on behalf of the Pittsburgh Bank. The Custodian shall not, however, be required to verify the validity, sufficiency or genuineness of any Mortgage Loan Document. Upon request of the Pittsburgh Bank from time to time, the MPF
Provider shall cause the Custodian to provide to the Pittsburgh Bank a list of all Mortgage Loans for which the Custodian holds Mortgage Loan Documents pursuant to the Custody Agreement. 
  
 5.2 MPF Provider to Act as Master Servicer for MPF Program Loans. 
  
 (a) The MPF Provider shall act as the master servicer for the
Pittsburgh Bank with respect to all Mortgage Loans funded or purchased by the Pittsburgh Bank pursuant to the MPF Program. The MPF Provider may discharge this duty by entering into a master servicing agreement (a
“Master Servicing Agreement”) with Norwest Bank Minnesota, N.A. or any other entity which the MPF Provider deems qualified to act as the Master Servicer. Subject to the provisions of Section 5.6., the MPF
Provider shall have direct and primary responsibility to the Pittsburgh Bank for the performance of the duties of the Master Servicer under the Master Servicing Agreement. 
  
 (b) The MPF Provider shall perform or cause to be performed the following master servicing duties, which
shall be done in compliance with the provisions of the Servicing Agreements, and the incorporated Guides: 
  
 (i) To supervise, monitor and oversee the servicing of the Mortgage Loans and the performance of each Servicer of its services, duties and obligations
under the Servicing Guide; 
  
 (ii) To receive and review all
reports and data that are provided and are deliverable under the Servicing Guide by each Servicer; 
  
 (iii) To cause the Master Servicer to use reasonable efforts to enforce the obligations of the Servicers under each of the Servicing Agreements;

  
 (iv) To collect information, reconcile such information with
each Servicer, and submit reports pertaining to the Mortgage Loans and any funds due with respect thereto, to the Pittsburgh Bank as provided for in the FHLB Guide; 
  
 (v) To consult with the Pittsburgh Bank and recommend corrective action to be taken relative to any Servicer that fails to
comply with the terms and conditions of the applicable Servicing Agreement and the Servicing Guide with respect to defaulted Mortgage Loans or the property encumbered as security for Mortgage Loans; 
  
 (vi) To deliver annually an officer’s certificate of the
MPf Provider or an officer of the Master Servicer, certifying as the signer thereof that: the master servicing activities during the preceding calendar year have been reviewed under such officer’s supervision; to the best of such
officer’s knowledge, the responsibilities and obligations of the Master Servicer have been performed throughout the year, or, if there has been a default, specifying each such default known to such officer and the nature and status thereof; and
that nothing came to such officer’s attention that indicated the Master Servicer was not in compliance with the provisions of the Master Servicing Agreement; 
  

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 (vii) To notify the Pittsburgh Bank in the event a Servicer has defaulted under the Servicing Agreement
or the Servicing Guide and to advise the Pittsburgh Bank of its recommended response to the default; 
  
 (viii) To maintain or cause the Master Servicer to maintain customary fidelity and other insurance in connection with the performance of the obligations
under the Master Servicing Agreement and, upon request, to provide an officer’s certificate certifying that such policy or coverage is in full force and effect; and 
  
 (ix) To make its books and records relating to the services performed under the Master Servicing Agreement or those of the
Master Servicer accessible for inspection and copying by the supervisory agents and examiners of the Finance Board and by the Pittsburgh Bank at any time during normal business hours. 
  
 As part of its master servicing duties hereunder, the MPF Provider, for the benefit of the Pittsburgh Bank, shall use its
best efforts to enforce the obligations of the Master Servicer under the Master Servicing Agreement. Such enforcement shall be in such form and carried out to such an extent and at such time as the MPF Provider, in its good faith
business judgment, would require if it were the owner of the related Mortgage Loans. Notwithstanding the MPF Provider’s delegation of master servicing obligations to the Master Servicer pursuant to the Master Servicing Agreement,
the MPF Provider shall not be relieved from its master servicing obligations hereunder, and the MPF Provider shall remain obligated and primarily liable to the Pittsburgh Bank for the master servicing of the Mortgage
Loans in accordance with the provisions of this Agreement, provided, however, that the MPF Provider shall have no liability arising from or related to its master servicing obligations under Sections 5.1 and 5.2, except for any such
liability resulting from the MPF Provider’s or Master Servicer’s negligence or willful misconduct. 
  
 5.3. Ancillary Support Services of the Program Loans by the MPF Provider. 
  
 (a) The MPF Provider shall provide ancillary support services
with respect to the Program Loans being administered under the MPF Program. Without limiting the generality of the foregoing, the MPF Provider will provide to the Pittsburgh Bank the specific ancillary support services
relating to the MPF Program set forth in this Article V and the FHLB Guide. 
  
 (b) The MPF Provider represents and warrants to the Pittsburgh Bank that (i) the software used by the MPF Provider in providing ancillary support services with respect to the Program
Loans being administered under the MPF Program (the “Servicing Software”) will operate prior to, during and after December 31, 1999 without error relating to date data, including without limitation, date data which
represents different centuries or more than one century, (ii) the Servicing Software will not operate abnormally or provide invalid or incorrect results as a result of date data representing different centuries or more than one century, (iii) the
Servicing Software is designed to ensure year 2000 capability, including without limitation, date data recognition, calculations which accommodate same century and multi-century formulas and data values, and date data interface values that reflect
the century, (iv) the Servicing Software will accurately and correctly manage and manipulate data involving dates, including single 
  

 -14- 

 century formulas and multi-century formulas, and will not cause an abnormally functioning or ending scenario within the
application or generate incorrect values or invalid results involving such dates, and (v) the Servicing Software will accurately process date/time data from, into and between the twentieth and twenty-first centuries, and the years 1999 and 2000, and
will accurately perform leap year calculations during and for the twentieth and twenty-first century, including the leap year 2000. Notwithstanding any other provision in this Agreement to the contrary, the MPF Provider’s
liability under this Section 5.3. (b) shall be limited to direct compensatory damages and in no event shall the MPF Provider be liable under this Section 5.3. (b) for consequential or punitive damages (except for willful misconduct or
gross negligence on the part of the MPF Provider). 
  
 (c) The MPF Provider shall deliver or cause to be delivered to the Pittsburgh Bank such monthly and other periodic reports relating to all Mortgage Loans for which the MPF Provider is providing ancillary
support services for the account of the Pittsburgh Bank, containing categories of information and in such format and at such intervals to allow the Pittsburgh Bank to reasonably prepare its required financial and regulatory reports, the specific
requirements of which shall be set forth in the FHLB Guide. 
  
 5.4. Selection of Pittsburgh Bank’s PFIs. The Pittsburgh Bank shall determine those of its members through which it will fund Mortgage Loans or from which it will purchase Mortgage Loans pursuant to the MPF
Program, and shall enter into a PFI Agreement with each such member in the form provided by the MPF Provider, subject only to modifications agreed to in writing by the parties hereto and the parties thereto. The MPF
Provider reserves the right to revise the form of the PFI Agreement from time to time. The Pittsburgh Bank shall use the most current form of PFI Agreement as supplied to it by the MPF Provider when executing a PFI Agreement with a
member. Any changes to the form of the PFI Agreement must be approved in writing by the MPF Provider prior to the execution of the agreement by the Pittsburgh Bank (which approval shall not be unreasonably withheld). 
  
 5.5. Creditworthiness of PFIs. The Pittsburgh Bank shall be
responsible for evaluating the creditworthiness of each of its PFIs to provide the credit enhancement required of a PFI under the MPF Program. The Pittsburgh Bank understands and acknowledges that the performance of each PFI is a risk
incident to originating or purchasing Loans pursuant to the MPF Program, and that the profitability of such investments is contingent, in part, on the creditworthiness of the PFIs it selects to do business with under the
MPF Program. 
  
 5.6. Training of Pittsburgh
Bank’s PFIs. The Pittsburgh Bank shall be responsible for training the personnel of its PFIs to enable them to participate in the MPF Program as Originators, sellers and servicers in accordance with the Guides. The Pittsburgh
Bank shall provide adequate personnel to provide such PFI training. Subject to the limitation in Section 3.1.1, the MPF Provider shall assist the Pittsburgh Bank in designing and organizing its PFI training program, as requested by
the Pittsburgh Bank at a cost of $750 per day plus travel and lodging expenses of the MPF Provider’s employees. All PFI training materials shall be approved by the MPF Provider. In the event a Pittsburgh Bank PFI
fails to service Program Loans in accordance with the Guides, then to the extent that such servicing problems are not attributable to the Master Servicer, and 
  

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 provided that the MPF Provider first consults with the Pittsburgh Bank regarding such servicing breach,
the Pittsburgh Bank shall pay the MPF Provider for the time spent by the MPF Provider’s staff in resolving such problems at a rate of $750 per day plus travel expenses, if any. 
  
 5.7. MPF Program Materials. The MPF
Provider may revise the form of the PFI Agreements, the Guides or any other MPF Program document at any time, provided that, when appropriate, the effective date of changes to the Guides shall be delayed to allow for the distribution
of such changes to all MPF Banks’ participating members. The MPF Provider shall send revisions to the Guides to the Pittsburgh Bank in advance of sending them directly to the Pittsburgh Bank’s PFIs.

  
 5.8. Support of Pittsburgh Bank’s PFIs. The
MPF Provider shall be responsible for providing operational support to all MPF Banks’ participating members by establishing an MPF Program Service Center (“Service Center”) that can be
reached by means of toll-free telephone and facsimile numbers and which will be staffed by MPF Provider personnel during such hours as may be agreed to by the parties from time to time. The MPF Provider shall ensure
that the Service Center is adequately staffed to fully service the Pittsburgh Bank’s PFIs in a commercially reasonable manner and with no less service than the MPF Provider is providing to its own participating members.

  
 5.9. Execution and Terms of Master Commitments. Upon
delivery by a PFI of an estimate of the number, characteristics and dollar amount of Mortgage Loans it will originate for or sell to the Pittsburgh Bank during the term of a proposed Master Commitment, the Pittsburgh Bank will establish the Spread
Account percentage, the Maximum Credit Enhancement Amount, the credit enhancement fee and the servicing fee for that Master Commitment in accordance with the Guides. Upon execution of a Master Commitment, the Pittsburgh Bank will provide timely
notification of the Master Commitment to the Service Center whose personnel will then enter it into the MPF Program system in accordance with the Guides. 
  
 5.10. Delivery Commitments, Pricing and Quality Control. 
  
 5.10.1. Delivery Commitments. The MPF
Provider’s Service Center will publish Rate and Fee Schedules for Agency Loans as provided for in the Guides which will be made available to the Pittsburgh Bank and its PFIs. Rate and Fee Schedules for Closed Loans shall be calculated by the
MPF Provider for each Delivery Commitment when the Mortgage Loans have been analyzed and a settlement date has been agreed upon by the Pittsburgh Bank and its PFI and communicated to the MPF Provider. Rate and Fee
Schedules are subject to change as provided for in the Guides. The Pittsburgh Bank’s PFIs will contact the Service Center to obtain and fill Delivery Commitments. The Service Center will provide regular reports of all Delivery Commitment
activities of the Pittsburgh Bank’s PFIs to the Pittsburgh Bank, either electronically or by facsimile, including, without limitation, all requests for funding of individual Mortgage Loans made by Pittsburgh Bank’s PFIs. The Pittsburgh
Bank shall fund all Mortgage Loans originated by its PFIs in accordance with the requirements of the Guides. The Service Center will compute any Pairoff Fees (defined in the Guides) that are owed to the Pittsburgh Bank and will report these amounts
to the Pittsburgh Bank. The Pittsburgh Bank shall be responsible for collecting Pairoff Fees from its PFIs. 
  

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 5.10.2. Pricing of Mortgage Loans. Pursuant to the delegation of pricing authority
established by the Finance Board in Resolution No. 98-41, dated September 23, 1998, the Pittsburgh Bank has elected to utilize the pricing methodology developed by the MPF Provider. Thus, the MPF Provider shall be
responsible for the calculation and publication of the prices applicable to both Agency Loans and Closed Loans. 
  
 5.10.3. Quality Control and Loss Mitigation. The MPF Provider will perform, or cause to be performed, the same level
of quality control review for the Pittsburgh Bank’s Mortgage Loans as it performs, or has performed, for its own Mortgage Loans and will communicate the results of its quality control activities promptly to the persons designated by the
Pittsburgh Bank to receive such reports. The MPF Provider will review the servicing and loss mitigation oversight of the Pittsburgh Bank’s Mortgage Loans in the same manner as it reviews the servicing and loss mitigation
oversight of its own Mortgage Loans and will provide the Pittsburgh Bank with prompt reports of its reviews. The Pittsburgh Bank will be responsible for managing the performance of its PFIs to assure a commercially reasonable standard of performance
in the origination and servicing of Mortgage Loans under the MPF Program, including the performance of loss mitigation oversight. Neither the MPF Provider nor any of its shareholders, directors, officers, employees or
agents shall be liable to the Pittsburgh Bank for any obligation, undertaking, act or judgment of any PFI. The obligation of the Pittsburgh Bank to manage its PFIs’ performance of these activities with respect to Mortgage Loans in the
MPF Program shall survive termination of this Agreement. 
  
 5.11. Transactional Relationships. 
  
 5.11.1. Maintenance of an Account at the MPF Provider. The Pittsburgh Bank will establish and maintain the Clearing Account with the MPF Provider. 
  
 5.11.2. Funding of Pittsburgh Bank’s Share of
Expenses. The Pittsburgh Bank will fund the Clearing Account sufficiently from time to time upon demand of the MPF Provider. The Pittsburgh Bank hereby consents to the MPF Provider withdrawing funds from such
account from time to time to satisfy the Pittsburgh Bank’s obligations to pay its obligations under this Agreement (whether or not the particular provision of this Agreement makes reference to such right of the MPF Provider to
effect such satisfaction by withdrawal from the Pittsburgh Bank’s Clearing Account, and whether or not any such withdrawal shall cause the balance in the Pittsburgh Bank’s Clearing Account to become negative). 
  
 5.11.3. Interest on Clearing Account. The
MPF Provider will credit to the Pittsburgh Bank’s Clearing Account interest on the outstanding balance thereof from time to time at the rate of interest customarily paid by the MPF Provider on its DID accounts from
time to time (the “DID Rate”). 
  

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 5.11.4. Overdrafts. In the event that any withdrawal from the Pittsburgh
Bank’s Clearing Account shall cause the balance in such account to become negative, such deficit shall be deemed a loan from the MPF Provider to the Pittsburgh Bank, payable upon demand and bearing interest at the overdraft rate
established by the MPF Provider for all its DID accounts. 
  

	5.12.	Relationship of the Parties; Restrictions on Transfers. The MPF Provider is not an agent of the Pittsburgh Bank except with respect to its obligations in
Sections 5.1. and 5.2., and the MPF Provider shall have no fiduciary obligations to the Pittsburgh Bank except with respect to its custodial duty as provided in Section 5.1., and the Pittsburgh Bank shall have no fiduciary obligations
to the MPF Provider except with respect to the obligations of Pittsburgh Bank set forth in Section 7.4.(c) of this Agreement. Notwithstanding the foregoing, the Pittsburgh Bank acknowledges that it will not sell or transfer any of its
Program Loans or its rights under this Agreement, or any portion of any thereof or any interest in any thereof, except (i) to another FHLB, (ii) to an institutional third party investor approved of in writing by the MPF Provider,
which approval shall not be unreasonably withheld, or (iii) to the PFIs providing the credit enhancement for such Mortgage Loans, provided, however, that for sales or transfers under clauses (i) and (ii), the Pittsburgh Bank shall continue to
monitor the creditworthiness of its PFIs and, when appropriate to protect the interests of the holders of the Mortgage Loans, demand and hold collateral to secure any of its PFI’s obligations under their respective PFI Agreements. Without
limiting the foregoing, if the Pittsburgh Bank elects to transfer participations other than on a Master Commitment basis in its Program Loans, the MPF Provider will continue to provide reports defined by Master Commitment and the
Pittsburgh Bank shall be responsible for any additional reporting necessitated by such participations. Further, the parties acknowledge that (i) the method for obtaining a security interest in a PFI’s assets under the PFI Agreement is by the
incorporation by reference into that document of the PFI’s Advances, Collateral Pledge and Security Agreement executed with the Pittsburgh Bank (the “Security Agreement”), and (ii) pursuant to the Security Agreement, all collateral
subject to the security interest created thereby secures all the obligations of a PFI to the Pittsburgh Bank on a pari passu basis, including the credit enhancement and other obligations arising under the PFI Agreement and the obligation to
repay advances made by the Pittsburgh Bank, unless (x) collateral is specifically pledged to secure the PFI’s credit enhancement obligations under the PFI Agreement or some other specific obligation, and (y) the MPF Provider is notified of the
specific collateral pledge, in which case, the specifically pledged collateral will first secure the specifically collateralized obligation. 

  
 5.13. Use of Intellectual Property. 
  
 (a) The MPF Provider hereby licenses to the Pittsburgh Bank the limited right to use the trademarks
“MORTGAGE PARTNERSHIP FINANCE” and “MPF” (individually, a “Mark” and together, the “Marks”) subject to the following terms and conditions:

  
 (i) The term of this license shall be the
same as this Agreement. Upon termination of this license, all rights in and to the Marks shall automatically revert to the MPF Provider. 
  

 -18- 

 (ii) When using either of the Marks in any external communications, including letters,
agreements, program descriptions and marketing materials, the Pittsburgh Bank agrees to adhere to the standards governing the use of the Marks set forth in the FHLB Guide. 
  
 (iii) The MPF Provider reserves the right to inspect or monitor the use of the Marks and the
services provided in connection with the Marks to assure compliance with this Agreement and the FHLB Guide. 
  
 (iv) The Pittsburgh Bank hereby recognizes the value of the goodwill associated with the Marks and acknowledges that all rights in and to
the Marks belong exclusively to the MPF Provider and that the Marks may have acquired secondary meaning in the mind of the public. The Pittsburgh Bank agrees, during the term of this Agreement and thereafter, never to attack or assist
any one else in attacking the rights of the MPF Provider in the Marks or the validity of the license of the Marks being granted herein. 
  
 (b) Should the Pittsburgh Bank elect the option to use the MPF System as provided in Section 7.3.2., prior to such use of
the MPF Provider’s proprietary intellectual property, the Pittsburgh Bank shall execute a licensing agreement in form customary in the software industry, and on terms reasonably satisfactory to the MPF Provider.

  
 ARTICLE VI  
 REPRESENTATIONS AND COVENANTS 
  
 6.1. Pittsburgh Bank’s Risk of Loss. The Pittsburgh Bank assumes all risk of loss in connection with its funding or purchasing each Program
Loan, and the execution of each PFI Agreement and each Master Commitment, except (i) to the extent of participation interests transferred to the MPF Provider and (ii) for any losses covered by the MPF Provider’s
indemnification of the Pittsburgh Bank set forth in Section 6.6, provided, however, that such assumption of risk is not intended to waive or release the liability of any person who is not a party to this Agreement. 
  
 6.2. Pittsburgh Bank’s Covenants. The Pittsburgh Bank covenants
and agrees as follows: 
  
 6.2.1. Use of
Proprietary Information and Confidentiality. The Pittsburgh Bank has previously been, and may from time to time be, furnished with certain materials and information relating to the MPF Program that are confidential and proprietary
information of the MPF Provider (collectively, the “Confidential Information”). All documents and 
  

 -19- 

 information furnished by the MPF Provider regarding the MPF Program shall
be presumed to be Confidential Information unless listed as disclosable in the FHLB Guide. The Pittsburgh Bank shall (i) keep the Confidential Information confidential using reasonable means, not less than those used to protect its own proprietary
material, (ii) not disclose the Confidential Information to any one other than (solely in connection with the MPF Program) to its officers or employees who have a need to know its contents to perform their duties for the Pittsburgh
Bank and to those third party agents who have signed confidentiality agreements protecting the MPF Provider, in form and substance reasonably satisfactory to the MPF Provider, unless required to do so pursuant to the
process or requirement of any court or governmental agency, and (iii) upon completion of its use of the Confidential Information or at any time upon the MPF Provider’s request, promptly return the Confidential Information to the
MPF Provider, including all copies made thereof in any format and all notes pertaining to the same. 
  
 6.2.2. Third Party Request for Confidential Information. The Pittsburgh Bank agrees that if it is served with process or any other
governmental or regulatory request for the Confidential Information, it will notify the General Counsel of the MPF Provider by telephone at (312) 565-5805 or by facsimile transmission at (312) 565-6938 or such telephone numbers as may
be set forth in the FHLB Guide, prior to complying with such process, order or request, except where such prior notice is prohibited by law. 
  
 6.2.3. Use and Licensing of MPF System. Should the Pittsburgh Bank elect to use the MPF System as
provided in Section 7.3.2., prior to such use of the MPF System, the Pittsburgh Bank shall (I) execute a licensing agreement in form customary in the software industry, and on terms reasonably satisfactory to the MPF
Provider, which shall, amongst other provisions, prohibit the Pittsburgh Bank from using the MPF System for Program Loans funded through or purchased from PFIs that are members of any other FHLB and from permitting the use of or
transferring the MPF System by or to any party other than the Pittsburgh Bank and (II) pay a one time license fee of $750,000. The MPF Provider shall then deliver to the Pittsburgh Bank a copy of the source code and any
and all other required materials necessary to the operation of the MPF System. The MPF Provider makes no representations that the MPF System will operate without errors on the Pittsburgh Bank’s
computer systems. 
  
 6.3. Authorization and Enforceability
Representations. The MPF Provider and the Pittsburgh Bank each hereby represents to the other party hereto that (i) all necessary corporate and other action has been taken to authorize it to execute, and to perform its obligations
under, this Agreement, and (ii) all necessary regulatory approvals to engage in the MPF Program have been received, and (iii) this Agreement is the legal, valid and binding obligation of such party, enforceable against it in
accordance with its terms. 
  
 6.4. MPF Provider
Representations and Warranties. In addition to the above representations, the MPF Provider represents and warrants to the Pittsburgh Bank that the MPF Program is fully compliant with all state and federal laws,
including consumer laws, and federal banking regulatory rules and regulations, except for any ruling arising in Texas Savings & 
  

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 Community Bankers Assoc., et al. v. Federal Housing Finance Board, Case No. A 97 CA 421SS (W. Dist. Texas). The
MPF Provider also represents to the Pittsburgh Bank that the accounting firm of Price Waterhouse has provided a letter confirming that the accounting treatment utilized by the MPF Provider in connection with the
MPF Program is fully consistent with Generally Accepted Accounting Principles. Further, the MPF Provider represents to the Pittsburgh Bank and warrants that all copyrights, trademarks, service marks, patents and other
intellectual property rights used in the MPF Program do not infringe upon the rights of any third parties. 
  
 6.5. Pittsburgh Bank’s Indemnification Obligation. The Pittsburgh Bank acknowledges that the ability to participate in the MPF
Program will be based upon its representations and warranties set forth above, and the Pittsburgh Bank agrees to indemnify, defend and hold harmless the MPF Provider, its affiliates and each stockholder, director, officer, employee
and agent, if any, thereof from and against any and all loss, damage, liability or expense, including (without limitation) costs and attorneys’ fees and expenses, to which it may be put or which it may incur by reason of, or in connection with,
any misrepresentation made by the Pittsburgh Bank in this Agreement, any breach by the Pittsburgh Bank of its warranties and/or any failure by the Pittsburgh Bank to fulfill any of its covenants or agreements set forth in this Agreement provided
that such failure was due to the negligence or willful misconduct of the Pittsburgh Bank. The Pittsburgh Bank’s indemnification under this section does not include any loss, damage, liability or expense arising out of any litigation challenging
the authority of the MPF Provider to engage in the MPF Program, including Texas Savings & Community Bankers Assoc., et al. v. Federal Housing Finance Board, Case No. A 97 CA 421SS (W. Dist. Texas).

  
 6.6. MPF Provider’s Indemnification
Obligation. Without limiting or modifying the provisions of Section 5.1. (c), the MPF Provider agrees to indemnify, defend and hold harmless the Pittsburgh Bank, its affiliates and each stockholder, director, officer, employee and
agent, if any, thereof from and against any and all loss, damage, liability or expense, including (without limitation) costs and attorney’s fees and expenses, to which it may be put or which it may incur by reason of, or in connection with, any
misrepresentation made by the MPF Provider in this Agreement, any breach by MPF Provider of its warranties and/or any failure by the MPF Provider to fulfill any of its covenants or agreements set forth in
this Agreement provided that such failure was due to the negligence or willful misconduct of the MPF Provider. The MPF Provider’s indemnification under this section does not include any loss, damage, liability or
expense arising out of Texas Savings & Community Bankers Assoc., et al. v. Federal Housing Finance Board, Case No. A 97 CA 421SS (W. Dist. Texas). 
  
 6.7. Review of MPF Provider’s Accounting Books and Records. From time to time upon reasonable advance request, the Pittsburgh
Bank shall be entitled to review, at its cost, the accounting books and records of the MPF Provider with respect to the Pittsburgh Bank’s participation in the MPF Program. The Pittsburgh Bank agrees and
acknowledges that the MPF Provider need not provide copies of confidential bank examiner’s reports. The MPF Provider will disclose to the Pittsburgh Bank any material deficiency in the controls or economic model of
the MPF system of which it becomes aware. 
  

 -21- 

 6.8. Exclusive Marketing to PFIs. The Pittsburgh Bank shall have the exclusive right to market the
MPF Program to its members. 
  
 ARTICLE VII 

 ASSET LIQUIDITY AND TERMINATION 
  
 7.1. Liquidity of MPF Program Assets; Purchase by MPF Provider. 
  
 7.1.1. Liquidity Option. From time to time, the
Pittsburgh Bank may elect to grant to the MPF Provider a 100% participation in all the Agency Loans funded pursuant to Delivery Commitments entered into by the Pittsburgh Bank on a given Business Day after the MPF
Provider has received notice from the Pittsburgh Bank of its intent to exercise this Liquidity Option (“Designated Loans”). The MPF Provider hereby agrees to acquire a 100% participation in the Designated Loans designated by
the Pittsburgh Bank, pursuant to a MPF Liquidity Option Participation Agreement in a form mutually acceptable to the parties. The Pittsburgh Bank shall designate Designated Loans by giving notice to the MPF Provider in
accordance with the procedures set forth in the FHLB Guide. 
  
 7.1.2. Rights Upon Discontinuance or Expiration. Subject to the provisions of Sections 5.10.3., 5.12. and 7.4., the Pittsburgh Bank shall have the right to discontinue its participation in the
MPF Program at any time, with or without cause, provided that the Pittsburgh Bank’s election to discontinue shall not relieve it of liability for any prior breach or violation of its obligations under this Agreement nor for any
obligations that survive termination of this Agreement. If, upon the Pittsburgh Bank’s discontinuance of the MPF Program or the expiration of the Term of this Agreement, the aggregate amount of the Pittsburgh Bank’s Program
Loans does not exceed $100 Million, then the Pittsburgh Bank shall have the right, but not the obligation, to sell its Program Loans to the MPF Provider at the then current Fair Market Value, by giving the MPF Provider
written notice not later than the last day of the Term of this Agreement. The MPF Provider shall continue to provide updates to the FHLB Guide, the Servicing Guide and any other bulletins or items issued to servicers under the
MPF Program to the Pittsburgh Bank and its PFIs servicing outstanding Program Loans until such time as all of the Pittsburgh Bank’s Program Loans are repaid or otherwise removed from the MPF Program (which
obligation shall survive termination or expiration of this Agreement). 
  
 7.1.3. Transfers of Required Acquisitions. Nothing in this Agreement shall limit the right of the MPF Provider to transfer participation interests in Program Loans that it may acquire from the
Pittsburgh Bank pursuant to Sections 7.1.1., or 7.1.2. 
  
 7.2.
Events of Default. It shall be an Event of Default under this Agreement if either party fails to perform its obligations or breaches any of its covenants under this Agreement and such failure to perform or breach is not cured (i) within sixty
(60) days from the date the non-breaching party gives written notice of such default, if the default is capable of being cured within such time limit, or (ii) within a reasonable time after the expiration of the sixty (60) day period following
notice, if the default is not capable of being cured within sixty (60) days following notice. 
  

 -22- 

 7.3. Termination and Other Remedies. 
  
 7.3.1. Remedies for the Pittsburgh Bank’s
Default. Upon the occurrence and during the continuance of an Event of Default caused by the Pittsburgh Bank, (i) the Pittsburgh Bank shall cease issuing new Master Commitments under the MPF Program, (ii) the MPF
Provider shall have no obligation to refund any Program Contribution, or to pay a Regular Participation Fee accruing after the occurrence and during the continuance of the Event of Default, and (iii) the MPF Provider may discontinue
providing ancillary support services on one hundred eighty (180) days’ notice to the Pittsburgh Bank, such services to be provided in the interim at the MPF Provider’s then current rate charged to other MPF
Banks. 
  
 7.3.2. Remedies for the
MPF Provider’s Default or for a Termination Event. Upon the occurrence of an Event of Default caused by the MPF Provider or a Termination Event, the Pittsburgh Bank shall have the right to cease issuing new
Master Commitments, and, at the election of the Pittsburgh Bank: 
  
 (i) If the aggregate balance of the Pittsburgh Bank’s outstanding Program Loans is less than or equal to $25 Million: 
  
 (A) the MPF Provider shall purchase the Pittsburgh Bank’s Loans at Fair Market Value; and 
  
 (B) the MPF Provider shall refund the full
amount of the Program Contribution paid by the Pittsburgh Bank; 
  
 (ii) If the aggregate balance of the Pittsburgh Bank’s outstanding Program Loans is greater than $25 Million but less than or equal to $100 Million: 
  
 (A) (I) subject to the provisions of Section 6.2.3., the MPF Provider shall license the
MPF System to the Pittsburgh Bank to operate on its own computer hardware to the Pittsburgh Bank and the Pittsburgh Bank shall engage its own custodian and master servicer and assume responsibility for the oversight of those functions
with respect to its outstanding and future Program Loans; or (II) the MPF Provider shall purchase the Pittsburgh Bank’s outstanding Program Loans at Fair Market Value, or (III) the MPF Provider will continue to
provide ancillary support services and act as custodian and master servicer for the Pittsburgh Bank’s outstanding Program Loans without charge to the Pittsburgh Bank, or (IV) the Pittsburgh Bank may engage its own custodian and master servicer
and assume responsibility for the oversight of those functions with respect to its outstanding Program Loans; and 
  

 -23- 

 (B) the MPF Provider shall refund the Program Contribution paid by the
Pittsburgh Bank in accordance with the following schedule: 
  
 (I) In the first year of the Term, 75% of paid Program Contribution; 
  
 (II) In the 2nd year of the Term, 50% of paid Program Contribution; or 
  
 (III) After the 2nd year of the Term, 25% of paid Program Contribution. 
  
 (iii) If the aggregate balance of the Pittsburgh Bank’s
outstanding Program Loans is greater than $100 Million: 
  
 (A) (I) subject to the provisions of Section 6.2.3., the MPF Provider shall license the MPF System to the Pittsburgh Bank to operate on its own computer hardware and the Pittsburgh Bank
shall engage its own custodian and master servicer and assume responsibility for the oversight of those functions with respect to its outstanding and future Program Loans; or (II) the MPF Provider will continue to provide ancillary
support services and act as custodian and master servicer for the Pittsburgh Bank’s outstanding Program Loans in accordance with the provisions of Article V, for an annual fee equal to four (4) basis points (0.04%) of the outstanding amount of
the Pittsburgh Bank’s Program Loans (subject to adjustment to reflect any increase in the Master Servicer’s fees and/or Custodian’s fees for such Program Loans), or (II) the Pittsburgh shall engage its own custodian and master
servicer and assume responsibility for the oversight of those functions with respect to its outstanding Program Loans, and 
  
 (B) the MPF Provider shall refund the Program Contribution paid by the Pittsburgh Bank in accordance with the following
schedule: 
  
 (I) In the first year of the Term,
75% of paid Program Contribution; 
  
 (II) In the
2nd year of the Term, 50% of paid Program Contribution; or 
  
 (III) After the 2nd year of the Term, 25% of paid Program Contribution. 
  
 7.4. Obligations Regarding PFIs; Support for Sold Loans. 
  

(a) In the case of any sale of Mortgage Loans to the MPF Provider under this Article VII, the Pittsburgh Bank’s
covenant to monitor the credit and collateral of the Pittsburgh Bank’s PFIs set forth in Section 5.12 and its obligations under its PFI Agreements and the FHLB Guide, shall apply and shall survive the expiration or termination of this
Agreement. The Pittsburgh Bank shall inform the MPF Provider of any adverse changes in the financial condition of such PFIs of which it becomes aware. The Pittsburgh Bank hereby represents and warrants to the MPF
Provider that the 
  

 -24- 

 creditworthiness of its PFIs will have been evaluated in connection with the credit enhancements provided
for any and all Program Loans which it may sell or participate to the MPF Provider under the terms of this Agreement, in the same way as it evaluates the creditworthiness of its PFIs to extend advances. 
  
 (b) The provisions of this Section 7.4. apply to any and all
Program Loans the Pittsburgh Bank sells to the MPF Provider. The Pittsburgh Bank hereby acknowledges that the MPF Provider has the need to have the credit enhancement obligations of any Pittsburgh Bank PFI relating to
purchased Program Loans secured if the creditworthiness of such Pittsburgh Bank PFI should become impaired. To assist the MPF Provider in ascertaining the creditworthiness of Pittsburgh Bank PFIs, the Pittsburgh Bank agrees to notify
the MPF Provider of any adverse changes in the financial condition of those PFIs who provide credit enhancements for any sold Program Loans and to share relevant credit assessments and information on those PFI with the
MPF Provider. 
  
 (c) Upon the
request of the MPF Provider, the Pittsburgh Bank agrees to call, hold and monitor such collateral of a Pittsburgh Bank PFI for the benefit of the MPF Provider, except when prohibited by law. In addition, the Pittsburgh
Bank agrees to hold for the MPF Provider’s benefit any and all collateral as may be provided by Pittsburgh Bank PFIs under their respective PFI Agreements to secure their obligations under PFI Agreements relating to sold Program
Loans. 
  
 (d) The MPF Provider
shall not have an interest in any (i) other property taken as security for any other credit, loan or financial accommodation made or furnished to any PFI by the Pittsburgh Bank in which the MPF Provider has no financial interest; (ii)
property now or hereafter in the Pittsburgh Bank’s possession or under the Pittsburgh Bank’s control other than by reason of any PFI Agreement; or (iii) deposits or other indebtedness which may be or might become security for performance
or payment of any obligations and liabilities of any PFI under the PFI Agreement by reason of the general description contained in any instrument other than the PFI Agreement held by the Pittsburgh Bank or by reason of any right of setoff,
counterclaim, banker’s lien or otherwise. If, however, such property, deposit, indebtedness or the proceeds thereof shall actually be applied to the payment or reduction of principal, interest, fees, commissions or any other amounts owing by
any PFI in connection with any Program Loan which the Pittsburgh Bank shall have sold to the MPF Provider, then the MPF Provider shall be entitled to such application with respect to such Loan. 
  
 7.5. Exculpation of MPF Provider. Neither the
MPF Provider nor any of its shareholders, directors, officers, employees or agents shall be liable to the Pittsburgh Bank for any obligation, undertaking, act or judgment of any Borrower, any guarantor or any other person liable on a
Mortgage Loan, or be bound to ascertain or inquire as to the performance or observance of any provision of any Mortgage Loan or any of the Mortgage Loan Documents. 
  
 7.6. Mediation of Disputes; Jurisdiction and Venue. (a) Neither the Pittsburgh Bank nor the MPF Provider shall
institute a proceeding before any tribunal to resolve any controversy 
  

 -25- 

 or claim arising out of or relating to the Agreement, or the breach, termination or invalidity thereof (a
“Dispute”), before such party has sought to resolve the dispute through mediation. If the parties do not promptly agree on a mediator, either party may request the then Chairman of the Board of the Finance Board to appoint a mediator. All
mediation proceedings under the Agreement shall be held in Washington, D.C. or such other location as the parties may agree upon. If the mediator is unable to facilitate a settlement of the Dispute within a reasonable time, as determined by the
mediator, the mediator shall issue a written statement to the parties to that effect and the complaining party may then pursue any other remedy available to it at law or in equity. The fees and expenses of the mediator shall be paid by the party
initiating mediation. 
  
 (b) The Pittsburgh Bank hereby consents to the exercise
of jurisdiction over its person and its property by any court of competent jurisdiction situated in the State of Illinois (whether it be a court of the State of Illinois or a court of the United States of America situated in Illinois) for the
enforcement of this Agreement or in any other controversy, dispute or question arising hereunder, and the Pittsburgh Bank hereby waives any and all personal or other rights to object to such jurisdiction for such purposes. The Pittsburgh Bank, for
itself and its successors and assigns, hereby waives any objection which it may have to the laying of venue of any such action, suit or proceeding in any such court; provided, that the provisions of this paragraph shall not be deemed to preclude any
other appropriate forum. If such litigation is commenced at any time, the Pittsburgh Bank agrees that service of process may be made, and personal jurisdiction over the Pittsburgh Bank obtained, by service of a copy of the summons, complaint and
other pleadings required to commence such litigation by United States certified or registered mail, return receipt requested, addressed to the Pittsburgh Bank at its address for notices as provided in this Agreement. The Pittsburgh Bank waives all
claims of lack of effectiveness or error by reason of any such service. 
  
 ARTICLE VIII  
 MISCELLANEOUS 
  

8.1. Notices. Whenever notice is required under this Agreement or by applicable law, it must be given as described in this section, unless
otherwise expressly provided in this Agreement. All demands, notices and communications under this Agreement shall be in writing (except as expressly provided in Section 8.2. below) and shall be either (i) delivered in person, (ii) sent by certified
United States mail, postage prepaid, return receipt requested, (iii) sent by facsimile transmission, or (iv) sent through a nationally recognized overnight delivery service, addressed at the applicable party’s address. Any such notice shall be
deemed delivered upon the earlier of actual receipt and, in the case of notice by United States mail, three Business Days after deposit with the United States post office, and in the case of notice by overnight courier, the Business Day immediately
following the date so deposited with the overnight delivery service. 
  
 8.2. The Guides and Other Documents. Copies of the Guides, including (without limitation) any amendments or supplements, or of any changes or pronouncements with respect thereto, shall be provided from time to time by the
MPF Provider, at its option, either (a) by regular mail or otherwise, or (b) electronically to the Pittsburgh Bank. 
  

 -26- 

 8.3. Addresses. For purposes of this Agreement, the addresses and facsimile numbers for the
MPF Provider and the Pittsburgh Bank and the electronic transmission information for the Pittsburgh Bank) are as set forth below their respective signatures to this Agreement. Any such change must be given in writing and given in
accordance with the provisions of Section 8.1., but shall be effective only upon actual receipt. 
  
 8.4. Effect of Agreement and Relationship of Parties. The MPF Provider will have no obligation or responsibility to the Pittsburgh
Bank except as specifically stated herein, and the MPF Provider shall not have a fiduciary duty to the Pittsburgh Bank except as set forth in Section 5.1. of this Agreement. The Pittsburgh Bank will have no obligation or
responsibility to the MPF Provider except as specifically stated herein, and the Pittsburgh Bank shall not have a fiduciary duty to the MPF Provider except as set forth in Section 7.4. (c) of this Agreement. This
Agreement constitutes the entire agreement among the parties, and no representation, promise, inducement or statement of intent has been made by the MPF Provider to the Pittsburgh Bank which is not embodied in this Agreement. This
Agreement supersedes the letter of intent dated as of March 31,1998, previously executed by the parties. 
  
 8.5. Execution in Counterparts; Facsimile Execution Permitted. This Agreement may be executed in any number of counterparts and by the parties
hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed an original and all of which counterparts, taken together, shall constitute but one and the same Agreement. The parties further agree that
this Agreement and signature pages thereof may be transmitted between them by facsimile machine and that counterpart facsimile copies are included in the Agreement. The parties intend that faxed signatures may constitute original signatures and that
a faxed signature page containing the signature (original or faxed) of all parties is binding on the parties. 
  
 8.6. Governing Law. This Agreement shall be a contract made under, and governed in every respect by, the internal laws (and not the conflicts law)
of the State of Illinois. 
  
 8.7. Severability of
Provisions. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction. 
  
 8.8. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the MPF Provider and the Pittsburgh
Bank and their respective successors and permitted assigns (subject to Section 5.11). 
  
 8.9. Waivers and Amendments. No delay on the part of the either party in the exercise of any right, power or remedy shall operate as a waiver thereof, nor shall any single or partial exercise by one party of
any right, power or remedy preclude other or further exercise thereof, or the exercise of any other right, power or remedy. No amendment to, modification or waiver of, or consent with respect to, any provision of this Agreement shall in any event be
effective unless in writing and executed and delivered by the MPF Provider and the Pittsburgh Bank, except for the subsequent modifications to the FHLB Guide which may be made by the MPF Provider after consultation with
all the MPF Banks. 
  

 -27- 

 8.10. References to Sections, Exhibits and Agreement; Captions. Unless otherwise indicated either
expressly or by context, any reference in this Agreement to a “Section” or “Exhibit” shall be deemed to refer to a Section of or Exhibit to this Agreement. All references herein to this “Agreement” shall, as of any time
after the date hereof, be deemed to include all amendments hereto which have .been made prior to such time in accordance with Section 8.9. Article and Section captions used in this Agreement are for convenience only, and shall not affect the
construction of this Agreement. 
  
 8.11. Specific
Performance. The parties hereto recognize and agree that it may be impossible to measure in money the damages which will accrue to any party hereto or its successors or assigns by reason of a failure to perform any of the obligations arising
under this Agreement. Therefore, if a party or its successors or assigns shall institute any action or proceeding to enforce any provision hereof, any party against whom such action or proceeding is brought hereby agrees that specific performance
may be sought and obtained for any breach of this Agreement, without the necessity of providing actual damages. 
  
 8.12. Mediation of Disputes; Jurisdiction and Venue. (a) Neither the Pittsburgh Bank nor the MPF Provider shall institute a
proceeding before any tribunal to resolve any controversy or claim arising out of or relating to the Agreement, or the breach, termination or invalidity thereof (a “Dispute”), before such party has sought to resolve the dispute through
mediation. If the parties do not promptly agree on a mediator, either party may request the then Chairman of the Board of the Finance Board to appoint a mediator. All mediation proceedings under the Agreement shall be held in Washington, D.C. or
such other location as the parties may agree upon. If the mediator is unable to facilitate a settlement of the Dispute within a reasonable time, as determined by the mediator, the mediator shall issue a written statement to the parties to that
effect and the complaining party may then pursue any other remedy available to it at law or in equity. The fees and expenses of the mediator shall be paid by the party initiating mediation, unless the parties agree otherwise. 
  
 (b) The Pittsburgh Bank hereby consents to the exercise of jurisdiction over its person and
its property by any court of competent jurisdiction situated in the State of Illinois (whether it be a court of the State of Illinois or a court of the United States of America situated in Illinois) for the enforcement of this Agreement or in any
other controversy, dispute or question arising hereunder, and the Pittsburgh Bank hereby waives any and all personal or other rights to object to such jurisdiction for such purposes. The Pittsburgh Bank, for itself and its successors and assigns,
hereby waives any objection which it may have to the laying of venue of any such action, suit or proceeding in any such court; provided, that the provisions of this paragraph shall not be deemed to preclude any other appropriate forum. If such
litigation is commenced at any time, the parties agrees that service of process may be made, and personal jurisdiction over either party obtained, by service of a copy of the summons, complaint and other pleadings required to commence such
litigation by United States certified or registered mail, return receipt requested, addressed to such party at its address for notices as provided in this Agreement. The Pittsburgh Bank and MPF Provider waive all claims of lack of
effectiveness or error by reason of any such service. 
  

 -28- 

 8.13. Option to Modify the Agreement. The Pittsburgh Bank shall have the right to have this
Agreement modified to conform to the terms and provisions accepted by any subsequent MPF Banks in negotiating a similar agreement with the MPF Provider, subject to the limitation that the Pittsburgh Bank must elect all
the modifications made for any other MPF Bank in its agreement with the MPF Provider rather than select some modifications and not others. 
  

 -29- 

 IN WITNESS WHEREOF, each of the MPF Banks and the MPF Provider has caused this Agreement to be executed by its duly
authorized officers, as of the dates first above written. 
  

			
	 MPF PROVIDER:
  
 FEDERAL HOME LOAN BANK OF CHICAGO

		
	By:	 	 /s/ Alex J. Pollock

	 	 	Alex J. Pollock, President & Chief Executive Officer

			
		
	Address:	 	111 East Wacker Drive, Suite 700
	 	 	Chicago, Illinois 60601
	 	 	Attention: Mr. Kenneth L. Gould
	 	 	                  Executive Vice President

  

			
	Facsimile No.: (312) 565-5855
	
	Electronic Transmission: kgould@fhlbc.com
	
	MPF BANK:
	
	FEDERAL HOME LOAN BANK OF PITTSBURGH
		
	By:	 	 /s/ James D. Roy

	 	 	James D. Roy, President & CEO
		
	By:	 	 /s/ Jane P. Duffy

	 	 	Jane P. Duffy, Senior Vice President

  

			
	Address:	 	 601 Grant Street, 15th Floor
 Pittsburgh, Pennsylvania
15219-4455
 Attention: MPF Operations Manager

	
	Facsimile No.: (412) 288-7318
	
	Electronic Transmission: renee.pfender@fhlb-pgh.com

  

 -30-

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