Document:

barclaysamendmentno2toml

Execution Version  1  AMENDMENT NO. 2 TO  MORTGAGE LOAN PARTICIPATION PURCHASE   AND SALE AGREEMENT   This Amendment No. 2 (this “Amendment”), dated as of  April 28, 2022, amends that  certain Mortgage Loan Participation Purchase and Sale Agreement, dated as of August 25, 2020  (as amended by that certain Amendment No. 1, dated as of September 24, 2021, and as further  amended, restated, supplemented, or otherwise modified from time to time, the “MLPPSA”),  by  and between Barclays Bank PLC, as administrative agent and purchaser (“Purchaser”), and  loanDepot.com, LLC, as seller (“Seller”), in connection with that certain Master Repurchase  Agreement, dated as of August 25, 2020 (as amended by that certain Amendment No. 1, dated as  of September 24, 2021, that certain Amendment No. 2, dated as of April 28, 2022, and as further  amended, restated, supplemented, or otherwise modified from time to time, the “Repurchase  Agreement”), by and between Purchaser and Seller.  Capitalized terms used herein but not  otherwise defined shall have the meanings given to such terms in the MLPPSA.  WHEREAS, the parties hereto desire to amend the MLPPSA as described below.  NOW, THEREFORE, in consideration of the amendments, agreements and other  provisions herein contained and of certain other good and valuable consideration the receipt and  sufficiency of which is hereby acknowledged by the parties hereto, it is hereby agreed between  Purchaser and Seller as follows:  Section 1. Amendments.  Effective as of the date hereof, the MLPPSA is  hereby amended to delete the stricken text (indicated textually in the same manner as the  following example:  stricken text) and to add the double-underlined text (indicated textually in  the same manner as the following example:  double-underlined text) as set forth in Exhibit A  hereto.  Section 2. Fees and Expenses.  Seller agrees to pay to Purchaser all fees and  out of pocket expenses incurred by Purchaser in connection with this Amendment, including,  without limitation, all reasonable fees and out of pocket costs and expenses of the legal counsel  to Purchaser incurred in connection with this Amendment, in accordance with Section 2 and  Section 3 of that certain Master Repurchase Agreement Pricing Side Letter, dated as of August  25, 2020 (as amended by that certain Amendment No. 1, dated as of September 29, 2020, that  certain Amendment No. 2, dated as of November 24, 2020, that certain Amendment No. 3, dated  as of December 18, 2020, that certain Amendment No. 4, dated as of March 10, 2020, that  certain Amendment No. 5, dated as of April 16, 2021, that certain Amendment No. 6, dated as of  August 18, 2021, that certain Amendment No. 7, dated as of September 24, 2021, and that  certain Amendment No. 8, dated as of April 28, 2022, and as further amended, restated,  supplemented, or otherwise modified from time to time, the “MRA Pricing Side Letter”), by and  between Purchaser and Seller, and Section 24(a) of the Repurchase Agreement.      Section 3. Effectiveness of Amendment.  The parties hereto agree that this  Amendment shall not be effective until the execution and delivery to Purchaser of this  Amendment by the parties hereto, the execution and delivery to Purchaser of (i) Amendment No.  8 to the MRA Pricing Side Letter, dated as of April 28, 2022, (ii) Amendment No. 2 to the  

 

2  Repurchase Agreement, dated as of April 28, 2022, and (iii) Amendment No. 1 to Mortgage  Loan Participation Purchase and Sale Agreement Pricing Side Letter, dated as of April 28, 2022,  in each case, by the parties thereto.  Section 4. Effect of Amendment.  Except as expressly amended and modified  by this Amendment, all provisions of the MLPPSA shall remain in full force and effect and all  such provisions shall apply equally to the terms and conditions set forth herein.  After this  Amendment becomes effective, all references in the MLPPSA (or in any other document relating  to the Mortgage Loans) to “this Agreement,” “the Mortgage Loan Participation Purchase and  Sale Agreement,” “hereof,” “herein” or words of similar effect referring to such Agreement shall  be deemed to be references to such Agreement as amended by this Amendment.  This  Amendment shall not be deemed to expressly or impliedly waive, amend or supplement any  provision of the MLPPSA other than as set forth herein.  Section 5. Successors and Assigns.  This Amendment shall be binding upon  the parties hereto and their respective successors and assigns.  Section 6. Section Headings.  The various headings and sub-headings of this  Amendment are inserted for convenience only and shall not affect the meaning or interpretation  of this Amendment or the MLPPSA or any provision hereof or thereof.   Section 7. Representations.  In order to induce Purchaser to execute and  deliver this Amendment, Seller hereby represents to Purchaser that as of the date hereof (i) it is  in full compliance with all of the terms and conditions of the Program Documents and remains  bound by the terms thereof and (ii) no Default or Event of Default has occurred and is continuing  under the Program Documents.  Section 8. GOVERNING LAW.  THIS AMENDMENT SHALL BE  CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE  STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS  PRINCIPLES THEREOF (EXCEPT FOR SECTIONS 5-1401 AND 5-1402 OF THE NEW  YORK GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND  REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN  ACCORDANCE WITH SUCH LAWS.  Section 9. Counterparts.  This Amendment may be executed in any number of  counterparts, all of which shall constitute one and the same instrument, and any party hereto may  execute this Amendment by signing and delivering one or more counterparts.  The parties intend  that faxed signatures and electronically imaged signatures such as .pdf files shall constitute  original signatures and are binding on all parties.  The original documents shall be promptly  delivered, if requested. The parties agree that this Amendment, any addendum, exhibit or  amendment hereto or any other document necessary for the consummation of the transactions  contemplated by this Amendment may be accepted, executed or agreed to through the use of an  electronic signature in accordance with E-Sign, UETA and any applicable state law.  Any  document accepted, executed or agreed to in conformity with such laws will be binding on all  parties hereto to the same extent as if it were physically executed and each party hereby consents  to the use of any secure third party electronic signature capture service with appropriate  

 

3  document access tracking, electronic signature tracking and document retention as may be  reasonably chosen by a signatory hereto, including but not limited to DocuSign.  [Signature Pages to Follow] 

 

Signature Page to Amendment No. 2 to Barclays-loanDepot Mortgage Loan Participation Purchase and Sale  Agreement  IN WITNESS WHEREOF, each undersigned party has caused this Amendment No. 2 to  the MLPPSA to be duly executed by one of its officers thereunto duly authorized as of the date  and year first above written.  BARCLAYS BANK PLC, as Purchaser and Agent  By:  Name:   Title:  Grace Park MD 

 

Signature Page to Amendment No. 2 to Barclays-loanDepot Mortgage Loan Participation Purchase and Sale  Agreement    LOANDEPOT.COM, LLC, as Seller,  By:        Name:   Title:  

 

  EXHIBIT A  065037.0000231 EMF_US 89666478v2  

 

CONFORMED THROUGH AMENDMENT NO. 12, DATED AS OF SEPTEMBER 24APRIL 28,  20212022  MORTGAGE LOAN PARTICIPATION PURCHASE AND SALE AGREEMENT  between          LOANDEPOT.COM, LLC  Seller        and        BARCLAYS BANK PLC  Purchaser and Agent          Dated August 25, 2020    

 

- i -  TABLE OF CONTENTS1 Page Section 1. Definitions................................................................................................................2  Section 2. Procedures for Purchases of Participation Certificates. .....................................1723 Section 3. Takeout Commitments. ......................................................................................2026 Section 4. Completion Fee. .................................................................................................2026  Section 5. Issuance of Securities. ........................................................................................2127 Section 6. Servicing of the Mortgage Loans; Servicer Termination; Backup Servicer. .....2329  Section 7. Transfers of Participation Certificates and Securities by Purchaser ..................2834 Section 8. Record Title to Mortgage Loans; Intent of Parties; Security Interest. ...............2934 Section 9. Representations and Warranties. ........................................................................3035 Section 10. Covenants of Seller ............................................................................................3338 Section 11. Term ...................................................................................................................3642 Section 12. Set-Off................................................................................................................3642 Section 13. Indemnification ..................................................................................................3743 Section 14. Exclusive Benefit of Parties; Assignment ..........................................................3743 Section 15. Amendments; Waivers; Cumulative Rights .......................................................3844 Section 16. Execution in Counterparts ..................................................................................3844 Section 17. Effect of Invalidity of Provisions .......................................................................3844 Section 18. Governing Law; Waiver of Jury Trial; Consent to Jurisdiction and Venue; Service  of Process ...........................................................................................................3844 Section 19. Notices ...............................................................................................................3945 Section 20. Entire Agreement ...............................................................................................3945 Section 21. Costs of Enforcement .........................................................................................4045  Section 22. Securities Contract; Netting Agreement. ...........................................................4046   1 The Table of Contents was amended by Amendment No. 2, dated as of April 28, 2022.  

 

- ii -  Section 23. Consent to Service .............................................................................................4146  Section 24. Construction .......................................................................................................4146  Section 25. Further Assurances.............................................................................................4147 Section 26. Due Diligence ....................................................................................................4147  Section 27. Confidentiality ...................................................................................................4247 Section 28. Contractual Recognition of Bail-In. ...................................................................4348 Section 29. USA Patriot Act; OFACSanctions and Anti-Terrorism. ..................................4349 Section 30. Contractual Recognition of UK Stay In Resolution ..........................................4750 Section 31. Notice Regarding Client Money Rules. .............................................................4850  Section 32. Effect of Benchmark Transition Event. .............................................................4850  EXHIBITS  Exhibit A Participation Certificate   Exhibit B Trade Assignment Exhibit C Reserved  Exhibit D Warehouse Lender’s Release Exhibit E Assignment  Exhibit F Form of Confirmation  Annex A Purchaser Notices/Agent Notices/Seller Notices     

 

MORTGAGE LOAN PARTICIPATION PURCHASE AND SALE AGREEMENT  This is a MORTGAGE LOAN PARTICIPATION PURCHASE AND SALE  AGREEMENT (“Agreement”), dated as of August 25, 2020, between Barclays Bank PLC, as  administrative agent (“Agent”) and purchaser (“Purchaser”) and loanDepot.com, LLC, as Seller  (“Seller”).  PRELIMINARY STATEMENT  Seller desires to sell to Purchaser from time to time all of Seller’s beneficial right,  title and interest in and to designated pools of fully amortizing first lien residential Mortgage Loans  eligible in the aggregate to back Securities, and the servicing rights relating thereto, with the terms  described in related Takeout Commitments, each in the form of a 100% undivided beneficial  ownership interest evidenced by a Participation Certificate.  Purchaser desires and may, in its sole discretion, purchase such Participation  Certificates from Seller in accordance with the terms and conditions set forth in this Agreement.  Seller, subject to the terms hereof, will cause (a) the Related Mortgage Loans to back a Security  issued by Seller and guaranteed by the Applicable Agency, and (b) Delivery of such Security by  the Applicable Agency to Purchaser or its designee in exchange for the Related Participation  Certificate, which Security will be purchased by a Takeout Investor.  Purchaser’s willingness to purchase any Participation Certificate evidencing a  beneficial interest in the Related Mortgage Loans and the servicing rights related thereto is at the  sole discretion of Purchaser and based on Purchaser’s expectation, in reliance upon Seller’s  representations and warranties herein, that (a) such Mortgage Loans in the aggregate, constitute a  pool or pools of mortgage loans that are eligible to back a Security, (b) such Mortgage Loans are  sufficient for Seller to issue and the Applicable Agency to guarantee the Security, (c) such Security  will be issued in the amount and with the terms described in the related Takeout Commitment, (d)  Purchaser’s broker-dealer affiliate, Barclays Capital Inc. (“BCI”) will receive Delivery of such  Security on the specified Anticipated Delivery Date on behalf of Purchaser, and (e) such Security  will be purchased by the related Takeout Investor.  The amount of the Purchase Price and the Completion Fee to be paid by Purchaser  to Seller with respect to each Participation Certificate will be calculated on the expectation of  Purchaser, based upon the representations and warranties of Seller herein, that Purchaser or BCI,  on behalf of Purchaser, will receive Delivery of the Security to be backed by the Related Mortgage  Loans on the specified Anticipated Delivery Date, that failure to receive such Delivery will result  in a material decrease in the market value of the Participation Certificate and the Related Mortgage  Loans considered as a whole and that the related Takeout Investor will purchase the Security from  Purchaser or BCI, on behalf of Purchaser. During the period from the purchase of a Participation  Certificate to Delivery of the related Security, Purchaser expects to rely entirely upon Seller (or its  designated subservicer) to subservice the Related Mortgage Loans for the benefit of Purchaser, it  being acknowledged that the continued effectiveness of Seller’s (or such subservicer’s) Approvals  during such period constitutes an essential factor in the calculation by Agent of the Purchase Price  and the Completion Fee paid to Seller for the Related Participation Certificate and that loss of such  

 

- 2 -    Approvals by Seller would result in a material decrease in the market value of the Participation  Certificate and the Related Mortgage Loans considered as a whole.  In consideration of the mutual promises and agreements herein contained the  receipt and sufficiency of which are hereby acknowledged, the parties hereto as follows:   Section 1. Definitions.  Capitalized terms used but not defined herein shall have the meanings set forth in  the Custodial Agreement or the Master Repurchase Agreement, each as defined below. As used in  this Agreement, the following terms shall have the following meanings:  “30+ Day Delinquent Mortgage Loan” means any Mortgage Loan that, as of any  determination date, using the MBA Methodology, is thirty (30) or more days delinquent (inclusive  of any grace period).   “Accepted Servicing Practices” means with respect to any Mortgage Loan, those  accepted, customary and prudent mortgage servicing practices (including collection procedures)  of prudent mortgage banking institutions that service mortgage loans of the same type as the  Mortgage Loans in the jurisdiction where the related Mortgaged Property is located, and which are  in accordance with the requirements of each Agency Program, applicable law, FHA regulations  and VA regulations, if applicable, and the requirements of any private mortgage insurer so that the  FHA insurance, VA guarantee or any other applicable insurance or guarantee in respect of any  Mortgage Loan is not voided or reduced.  “Adjustable Rate Mortgage Loan” means a Mortgage Loan that provides for the  adjustment of the Mortgage Interest Rate payable in respect thereto.  “Affiliate” means with respect to any specified entity, any other entity controlling  or controlled by or under common control with such specified entity. For the purposes of this  definition, “control” when used with respect to a specified entity means the power to direct the  management and policies of such entity, directly or indirectly, whether through the ownership of  voting securities, by contract or otherwise, and the terms “controlling” and “controlled” having  meanings correlative to the foregoing. For the avoidance of doubt, none of (a) MTH Mortgage,  LLC, MSC Mortgage, LLC, TRI Pointe Connect, LLC, Day One Mortgage, LLC, Farm Bureau  Mortgage, LLC, LGI Mortgage Solutions LLC, Henlopen Mortgage, LLC, BRP Home Mortgage,  LLC, CUSA Affordable Housing, LLC, Commercial Agency USA, LLC, (b) any Permitted Holder  or (c) any joint venture formed by Seller or the Permitted Holders after the date hereof in which  (i) Seller holds a non-controlling interest and (ii) whose financial performance has no material  impact on Seller’s financial performance; in all cases shall be considered an Affiliate for purposes  of this Agreement or any other Program Document. 12  “Agency” means Freddie Mac, Fannie Mae or Ginnie Mae, as applicable.    12 The definition of “Affiliate” was amended by Amendment No. 1, dated as of September 24, 2021.  

 

- 3 -    “Agency Guide” means the Freddie Mac Guide, the Fannie Mae Guide, or the  Ginnie Mae Guide, as applicable.  “Agency Mortgage Loans” means Fannie Mae Mortgage Loans, Freddie Mac  Mortgage Loans, and Ginnie Mae Mortgage Loans.  For the avoidance of doubt, the term “Agency  Mortgage Loans” does not include Agency Scratch and Dent Mortgage Loans.  “Agency Program” means the Freddie Mac Program, the Fannie Mae Program, or  the Ginnie Mae Program, as applicable.  “Agency Scratch and Dent Mortgage Loan” means a first lien Mortgage Loan  originated by Seller and intended to be originated in accordance with the criteria of Fannie Mae,  Freddie Mac or Ginnie Mae, as applicable, except such Mortgage Loan is not eligible for sale to  or pooling with the Agency.  “Agent” means Barclays Bank PLC and its successors in interest, as administrative  agent for Purchaser and any additional purchasers that may become a party hereto.  “Aggregate EPF Purchase Price” means, as of any date of determination, an amount  equal to the aggregate Outstanding Purchase Price for all Participation Certificates then owned by  Purchaser and subject to the terms of this Agreement.23 “Aggregate MRA Purchase Price” means as of any date of determination, an  amount equal to the aggregate Outstanding Purchase Price (as defined in the Master Repurchase  Agreement) for all Purchased Assets (as defined in the Master Repurchase Agreement) then subject to Transactions under the Master Repurchase Agreement.34 “Anticipated Delivery Date” means, with respect to a Security, the date specified  in the related Form HUD 11705 (Schedule of Subscribers), Fannie Mae Form 2014 (Delivery  Schedule) or Freddie Mac Form 939 (Settlement and Information Multiple Registration Form), as  applicable, on which it is anticipated that Delivery of the Security by the Applicable Agency will  be made, which date shall occur no more than thirty (30) days following the related Purchase Date. “Applicable Agency” means Ginnie Mae, Fannie Mae, or Freddie Mac, as  applicable.  “Applicable Margin” has the meaning assigned thereto in the Pricing Side Letter.  “Appraised Value” means the value set forth in an appraisal made in connection  with the origination of the related Mortgage Loan as the value of the Mortgaged Property.  “Approvals” means with respect to Seller, the approvals obtained from the  Applicable Agency or HUD in designation of Seller as a Ginnie Mae-approved issuer, an FHA-   23 The definition of “Aggregate EPF Purchase Price” was amended by Amendment No. 1, dated as of  September 24, 2021.  34 The definition of “Aggregate MRA Purchase Price” was amended by Amendment No. 1, dated as of  September 24, 2021.  

 

- 4 -    approved mortgagee, a VA-approved lender, a Fannie Mae-approved lender or a Freddie Mac- approved Seller/Servicer, as applicable, in good standing.  “Assignee” shall have the meaning assigned thereto in Section 7.  “Assignment of Mortgage” means, with respect to any Mortgage, an assignment of  the Mortgage, notice of transfer or equivalent instrument in recordable form, sufficient under the  laws of the jurisdiction wherein the related Mortgaged Property is located to reflect the assignment  of the Mortgage to Purchaser.   “ATR Rules” means the “ability to repay” rules specified in the federal Truth-in- Lending Act as amended pursuant to rulemaking authority provided under the federal Dodd-Frank  Act which require lenders to make a reasonable, good-faith determination that a Mortgagor has an  ability to repay the loan as determined by the following eight (8) underwriting factors: (i) current  or reasonably expected income or assets (other than the value of the property that secures the loan)  that the Mortgagor will rely on to repay the loan, (ii) current employment status (if the originator  relies on employment income when assessing the Mortgagor’s ability to repay), (iii) monthly  mortgage payment for the loan, (iv) monthly payment on any simultaneous loans secured by the  same property, (v) monthly payments for property taxes and required insurance, and certain other  costs related to the property such as homeowners association fees or ground rent, (vi) debts,  alimony, and child-support obligations, (vii) monthly debt-to-income ratio or residual income,  calculated using the total of all of the mortgage and nonmortgage obligations listed above, as a  ratio of gross monthly income and (viii) credit history.  “Bail-In Action” means the exercise by the Bank of England (or any successor   resolution authority) of any write-down or conversion power existing from time to time (including,  without limitation, any power to amend or alter the maturity of eligible liabilities of an institution  under resolution or amend the amount of interest payable under such eligible liabilities or the date  on which interest becomes payable, including by suspending payment for a temporary period and  together with any power to terminate and value transactions) under, and exercised in compliance  with, any laws, regulations, rules or requirements in effect in the United Kingdom relating to the  transposition of the European Banking Recovery and Resolution Directive as amended from time  to time, including but not limited to, the Banking Act 2009 as amended from time to time, and the  instruments, rules and standards created thereunder, pursuant to which Purchaser’s obligations (or  those of Purchaser’s affiliates) can be reduced (including to zero), canceled or converted into  shares, other securities, or other obligations of Purchaser or any other person.   “Bank” means (i) Deustche Bank National Trust Company and its successors and  permitted assigns or (ii) such other bank as may be mutually acceptable to the Seller and the  Purchaser.  “Bankruptcy Code” means 11 U.S.C. §§ 101 et seq., as amended from time to time. “Benchmark” means, initially LIBOR, Term SOFR; provided that if a  replacementBenchmark Transition Event has occurred pursuant to Section 32with respect to  Term SOFR or the then-current Benchmark, then “"Benchmark”" means the applicable  Benchmark Replacement to the extent that such Benchmark Replacement has replaced thesuch  

 

- 5 -    prior benchmark rate. Any reference to “Benchmark” shall include, as applicable, the  published component used in the calculation thereof.4 pursuant to Section 32.5  “Benchmark Replacement” means the sum of:   (1) For purposes of Section 32(b), the first alternative set forth below that can be  determined by the Agent: (a) the sum of: (i) Term SOFR and (ii) 0.11448% (11.448 basis  points) for a tenor of one-month’s duration, or  (b) the sum of: (i) Daily Compounded SOFR and (ii) the spread adjustment selected or recommended by the Relevant Governmental Body for the replacement of LIBOR with a SOFR-based rate having approximately the same length as the Net Carry Adjustment Period;  and (1) (2) For purposes of Section 32(c), the sum of (a) the alternate benchmark  rate and (b) an adjustment (which may be a positive or negative value or  zero), in each case, that has been selected by the Agent and the Purchaser as  the replacement for the relevant tenor of such Benchmark giving due  consideration to     (a) any selection or recommendation of a replacement rate or the  mechanism for determining such a rate by the Relevant  Governmental Body at such time or   (b) any evolving or then-prevailing market convention, including any  applicable recommendations made by the Relevant Governmental  Body, for U.S. dollar-denominated for determining a rate of  interest for Dollar-denominated syndicated or bilateral credit  facilities at such time; and  (2) the Benchmark Replacement Adjustment, provided that, if at any time, the Benchmark Replacement as so determined  pursuant to clause (1) or (2) above would be less than the Floor, the Benchmark  Replacement will be deemed to be the Floor for the purposes of this Agreement and  theany other Program Documents.56  “Benchmark Replacement Adjustment” means, for each applicable Accrual  Period, the spread adjustment, or method for calculating or determining such spread  adjustment, (which may be a positive or negative value or zero) that has been selected by    4 The definition of “Benchmark” was amended by Amendment No. 1, dated as of September 24, 2021.  5 The definition of “Benchmark” was amended by Amendment No. 1, dated as of September 24, 2021,  and amended by Amendment No. 2, dated as of April 28, 2022.  5 The definition of “Benchmark Replacement” was amended by Amendment No. 1, dated as of  September 24, 2021.  6 The definition of “Benchmark Replacement Adjustment” was deletedamended by Amendment No. 1,  dated as of September 24, 2021, and amended by Amendment No. 2, dated as of April 28, 2022.  

 

- 6 -    Purchaser giving due consideration to the factors set forth in clauses (1)(a) and (1)(b) in the  definition of Benchmark Replacement. 7  “Benchmark Replacement Conforming Changes” means, with respect to any  Benchmark Replacement, any technical, administrative or operational changes (including changes  to the definition of “Net Carry AdjustmentAccrual Period,” timing and frequency of determining  rates and making payments of interest, timing of seller requests orfor repurchase, the applicability  and length of lookback periods and other technical, administrative or operational matters) that the  Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark  Replacement and to permit the administration thereof by the Agent in a manner substantially  consistent with market practice (or, if the Agent decides that adoption of any portion of such  market practice is not administratively feasible or if the Agent determines that no market practice  for the administration of the Benchmark Replacement exists, in such other manner of  administration as the Agent decides is reasonably necessary in connection with the administration  of this Agreement).789 “Benchmark Replacement Date” means the date on which a Benchmark  Replacement becomes effective pursuant to Section 32.10   “Benchmark Transition Event” means, with respect to any then-current  Benchmark other than LIBOR, the occurrence of a public statement or publication of information  by or on behalf of the administrator of the then-current Benchmark, the regulatory supervisor for  the administrator of such Benchmark, the Board of Governors of the Federal Reserve System, the  Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator  for such Benchmark, a resolution authority with jurisdiction over the administrator for such  Benchmark or a court or an entity with similar insolvency or resolution authority over the  administrator for such Benchmark, announcing or stating that (a) such administrator has ceased or  will cease on a specified date to provide all applicable tenors of such Benchmark, permanently or  indefinitely, provided that, at the time of such statement or publication, there is no successor  administrator that will continue to provide any applicable tenor of such Benchmark or, (b) all  applicable tenors of such Benchmark are or will no longer be representative of the underlying  market and economic reality that such Benchmark is intended to measure and that  representativeness will not be restored.9 or that such Benchmark is or will not be in compliance  or aligned with the International Organization of Securities Commissions Principals for  Financial Benchmarks, (c) Agent determines in its sole discretion that, by reason of    7  The definition of “Benchmark Replacement Adjustment” was deleted by Amendment No. 1, dated  as of September 24, 2021, and added by Amendment No. 2, dated as of April 28, 2022.  7 The definition of “Benchmark Replacement Conforming Changes” was amended by Amendment No.  1, dated as of September 24, 2021.  8 The definitionsdefinition of “Benchmark Transition Start Date” and “Benchmark Unavailability  Period” was deletedReplacement Conforming Changes” was amended by Amendment No. 1, dated as of  September 24, 2021, and amended by Amendment No. 2, dated as of April 28, 2022.  9   The definitions of “Benchmark Transition Start Date” and “Benchmark Unavailability Period”  were deleted by Amendment No. 1, dated as of September 24, 2021.  10 The definition of “Benchmark Replacement Date” was added by Amendment No. 2, dated as of April  28, 2022.  9 The definition of “Benchmark Transition Event” was amended by Amendment No. 1, dated as of  September 24, 2021.  

 

- 7 -    circumstances affecting the relevant market, adequate and reasonable means do not exist for  ascertaining such Benchmark, or (d) Agent determines in its sole discretion that the adoption  of any Change in Law or in the interpretation or application thereof shall make it unlawful  for Purchaser to accrue Price Differential based on such Benchmark.11   “Business Day” means (A) any day other than (i) a Saturday or Sunday, or (ii) a  day upon which the New York Stock Exchange or the Federal Reserve Bank of New York is  closed., or (iii) with respect to any day on which the parties hereto have obligations to the  Custodian or on which the Custodian has obligations to any party hereto, a day upon which  the Custodian’s offices are closed, and (B) with respect to any calculation of Term SOFR, a  U.S. Government Securities Business Day.12 “Change in Control” means (a) any event or series of events by which any “person”  or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), but excluding  any employee benefit plan of such person or its Subsidiaries, and any person or entity acting in its  capacity as trustee, agent or other fiduciary or administrator of any such plan), other than the  Permitted Holders becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the  Exchange Act), directly or indirectly, of 51% or more of the equity securities of loanDepot, Inc.,  a Delaware corporation, entitled to vote for members of the board of directors or equivalent  governing body of Seller on a fully-diluted basis, (b) the sale, transfer, or other disposition of all  or substantially all of Seller’s assets (excluding any such action taken in connection with any  securitization transaction or routine sales of Mortgage Loans) or (c) the consummation of a merger  or consolidation of Seller with or into another entity or any other corporate reorganization, if more  than 50% of the combined voting power of the continuing or surviving entity’s equity outstanding  immediately after such merger, consolidation or such other reorganization is owned by persons  who were not equityholders of the Seller immediately prior to such merger, consolidation or other  reorganization.1013  “Client Money Distribution Rules” has the meaning assigned thereto in Section  31(b) hereof. “Client Money Rules” has the meaning assigned thereto in Section 31(a) hereof. “Collateral” has the meaning assigned thereto in Section 8(c).  “Completion Fee” means, with respect to each Participation Certificate, an amount  equal to the Discount plus the Net Carry Adjustment, less any reduction pursuant to Section 5(b),  which amount shall be payable to Seller by Purchaser in two installments as provided in Section  4(a), the Initial Completion Fee Installment and the Final Completion Fee Installment, as    11 The definition of “Benchmark Transition Event” was amended by Amendment No. 1, dated as of  September 24, 2021, and Amendment No. 2, dated as of April 28, 2022.  12 The definition of “Business Day” was amended by Amendment No. 2, dated as of April 28, 2022.  1013 The definition of “Change in Control” was amended by Amendment No. 1, dated as of September 24,  2021.  

 

- 8 -    compensation to Seller for its services in connection with the issuance of the related Security and  performance of its obligations under this Agreement.14  “Compounded SOFR” means the compounded average of SOFRs for the  applicable month, with the rate, or methodology for this rate, and conventions for this rate  (which may include compounding in arrears with a lookback and/or suspension period as a  mechanism to determine the interest amount payable prior to the end of each Accrual  Period) being established by the Agent in accordance with:   (a) the rate, or methodology for this rate, and conventions for this rate selected or  recommended by the Relevant Governmental Body for determining compounded SOFR; or  (b) if, and to the extent that, the Agent determines that Compounded SOFR cannot  be determined in accordance with clause (a) above, then the rate, or methodology for this  rate, and conventions for this rate that the Agent determines in its reasonable discretion are  substantially consistent with any evolving or then-prevailing market convention for  determining compounded SOFR for U.S. dollar-denominated syndicated credit facilities at  such time;   provided that if the Agent decides that any such rate, methodology or convention  determined in accordance with clause (a) or clause (b) above is not administratively feasible  for the Agent, then Compounded SOFR will be deemed unable to be determined for purposes  of the definition of “Benchmark Replacement.”  “Confirmation” means a written confirmation of Purchaser’s intent to purchase a  Participation Certificate, which written confirmation shall be substantially in the form attached  hereto as Exhibit F.  “Custodial Account” has the meaning ascribed thereto in the Custodial Account  Control Agreement.  “Custodial Account Control Agreement” means the Custodial Account Control  Agreement, dated of even date herewith, among Seller, Purchaser and Bank entered into in  connection with this Agreement, as amended, supplemented or otherwise modified from time to  time.   “Custodial Agreement” means that certain Custodial and Disbursement  Agreement, dated as of August 25, 2020, among Seller, Purchaser, Agent, Disbursement Agent  and Custodian, entered into in connection with this Agreement and the Master Repurchase  Agreement, as the same may be amended, modified or supplemented from time to time.  “Custodian” means Deutsche Bank National Trust Company, and its successors and  permitted assigns, or such other entity as mutually agreed upon by Agent and Seller.15    14 The definition of “Compounded SOFR” was deleted by Amendment No. 2, dated as of April 28,  2022.  15 The definition of “Daily Compounded SOFR” was amended by Amendment No. 1, dated as of  September 24, 2021, and deleted by Amendment No. 2, dated as of April 28, 2022.  

 

- 9 -    “Daily Compounded SOFR” means, for any day, SOFR, with interest accruing  on a compounded daily basis, with the methodology and conventions for this rate (which will  include compounding in arrears with a lookback) being established by the Agent in  accordance with a methodology and the conventions for this rate selected or recommended  by the Relevant Governmental Body for determining "Daily Compounded SOFR" for  syndicated or bilateral business loans; provided that, if the Agent decides that any such  convention is not administratively feasible for the Agent, then the Agent may establish  another convention in its reasonable discretion.11  “Daily Completion Fee Reduction Amount” shall have the meaning assigned  thereto in the Pricing Side Letter.  “Defective Mortgage Loan” means, with respect to a Participation Certificate, a  Related Mortgage Loan that is not in Strict Compliance with the Ginnie Mae Program, Fannie Mae  Program, or Freddie Mac Program, as applicable. “Delinquent” means, with respect to any Mortgage Loan, that a monthly payment  due thereon is not made by the close of business on the Due Date.   “Delivery” means the later to occur of (a) the issuance of the related Security and  (b) the transfer of all of the right, title and ownership interest in that Security to Purchaser or its  designee.  “Disbursement Agent” means Deutsche Bank National Trust Company and its  successors and permitted assigns, or such other entity as mutually agreed upon by Agent and Seller.  “Discount” has the meaning set forth in the Pricing Side Letter.   “Due Date” means the day of the month on which the Monthly Payment is due on  a Mortgage Loan, exclusive of any days of grace.   “Due Diligence Review Amount” has the meaning set forth in the MRA Pricing  Side Letter.16  “Early Opt-in Election” means the occurrence of:   (1) (i) a determination by the Agent or (ii) a notification  by the Purchaser to the Agent (with a copy to the Seller) that the  Purchaser have determined that U.S. dollar-denominated syndicated  or bilateral credit facilities being executed at such time, contain (as a  result of amendment or as originally executed) a SOFR-based rate  (including SOFR, a term SOFR or any other rate based on SOFR) as  a benchmark rate, and    11 The definition of “Daily Compounded SOFR” was amended by Amendment No. 1, dated as of  September 24, 2021.  16 The definition of “Early Opt-in Election” was amended by Amendment No. 1, dated as of September  24, 2021, and deleted by Amendment No. 2, dated as of April 28, 2022  

 

- 10 -    (2) (i) the election by the Agent or (ii) the election by the  Purchaser to declare that an Early Opt-in Election has occurred and  the provision, as applicable, by the Agent of written notice of such  election to the Seller and the Purchaser or by the Purchaser of written  notice of such election to the Agent.12  “Effective Date” shall have the meaning assigned thereto in the Master Repurchase  Agreement.   “Electronic Agent” shall have the meaning assigned thereto in Section 2 of the  Electronic Tracking Agreement.  “Electronic Tracking Agreement” means one or more Electronic Tracking  Agreements with respect to (x) the tracking of changes in the ownership, mortgage servicers and  servicing rights ownership of Purchased Mortgage Loans held on the MERS System, and (y) the  tracking of the Control of eNotes held on the MERS eRegistry, each in a form acceptable to Agent. “Electronic Transmission” means the delivery of information in an electronic  format acceptable to the applicable recipient thereof.  An Electronic Transmission shall be  considered written notice for all purposes hereof (except when a request or notice by its terms  requires execution).  “Eligible Mortgage Loan” means a Mortgage Loan that (i) satisfies each of the  representations and warranties in Exhibit B to the Master Repurchase Agreement in all material  respects, (ii) if such Mortgage Loan is (a) a Fannie Mae Mortgage Loan, a Freddie Mac Mortgage  Loan, or a Ginnie Mae Mortgage Loan, it is in Strict Compliance with the eligibility requirements  of the Ginnie Mae Program, Fannie Mae Program or Freddie Mac Program, as applicable, (b) a  Jumbo Mortgage Loan, (iii) with respect to all Mortgage Loans other than Wet-Ink Mortgage  Loans, contains all required documents in the Mortgage File without exceptions unless otherwise  waived by Purchaser or permitted pursuant to the terms of this Agreement or the Custodial and  Disbursement Agreement, and (iv) satisfies the Additional Eligible Loan Criteria.  “eMortgage Loan” means a Mortgage Loan with respect to which there is an eNote  and as to which some or all of the other documents comprising the related Mortgage File may be  created electronically and not by traditional paper documentation with a pen and ink signature.   “eNote” means, with respect to any eMortgage Loan, the electronically created and  stored Mortgage Note that is a Transferable Record.  “E-Sign” means the federal Electronic Signatures in Global and National  Commerce Act, as amended from time to time.  “Escrow Agreement” means that certain Fourth Amended and Restated Escrow  Agreement, dated as of August 16, 2016, as amended through that certain Amendment No. 7 and  Joinder to Fourth Amended and Restated Escrow Agreement, dated as of the date hereof, by and    12 The definition of “Early Opt-in Election” was amended by Amendment No. 1, dated as of September  24, 2021.  

 

- 11 -    among Seller, Purchaser and the other parties thereto, as the same may be amended, supplemented  or otherwise modified from time to time.  “Escrow Payments” means, with respect to a Mortgage Loan, the amounts  constituting ground rents, taxes, assessments, water charges, sewer rents, municipal charges,  mortgage insurance premiums, fire and hazard insurance premiums, condominium charges and  other payments as may be required to be escrowed by the Mortgagor with the Mortgagee pursuant  to the terms of the Mortgage or any other document. “E-Sign” means the federal Electronic Signatures in Global and National  Commerce Act, as amended from time to time.17  “Event of Insolvency” means, with respect to any Person,  (i) the filing of a voluntary petition (or the consent by such Person to the filing  of any such petition against it), commencing, or authorizing the commencement of any  case or proceeding under any bankruptcy, insolvency, reorganization, liquidation,  dissolution or similar law relating to the protection of creditors, or suffering any such  petition or proceeding to be commenced by another; or such Person shall consent or seek  to the appointment of or taking possession by a custodian, receiver, conservator, trustee,  liquidator, sequestrator or similar official of such Person, or for any substantial part of its  Property, or any general assignment for the benefit of creditors;  (ii) a proceeding shall have been instituted against such Person under any  bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution,  moratorium, delinquency or liquidation law of any jurisdiction, whether now or  subsequently in effect, or a custodian, receiver, conservator, liquidator, trustee,  sequestrator or similar official for such Person or such Person’s Property (as a debtor or  creditor protection procedure) is appointed by any Governmental Authority having the  jurisdiction to do so or takes possession of such Property and any such proceeding is not  stayed or dismissed within sixty (60) days of filing;  (iii) that such Person or any Affiliate shall become insolvent as such term is  defined in Section 101(32)(A) of the Bankruptcy Code;  (iv) that such Person shall (a) admit in writing its inability to pay or discharge  its debts or obligations generally as they become due or mature, (b) admit in writing its  inability to, or intention not to, perform any of its material obligations, or (c) generally fail  to pay any of its debts or obligations as they become due or mature; or  (v) any Governmental Authority shall have seized or appropriated, or assumed  custody or control of, all or any substantial part of the Property of such Person, or shall  have taken any action to displace the management of such Person.    17 The definition of “E-Sign” was moved pursuant to Amendment No. 2, dated as of April 28, 2022.  

 

- 12 -    “Fannie Mae” means the Federal National Mortgage Association or any successor  thereto.  “Fannie Mae Guide” means the Fannie Mae MBS Selling and Servicing Guide, as  such Guide may hereafter from time to time be amended.  “Fannie Mae Mortgage Loan” means, with respect to any Fannie Mae Participation  Certificate or any Fannie Mae Security, a mortgage loan that is in Strict Compliance on the related  Purchase Date with the eligibility requirements specified for the applicable Fannie Mae Program  described in the Fannie Mae Guide.  “Fannie Mae Participation Certificate” means, with respect to the Fannie Mae  Program, a certificate, substantially in the form of Exhibit A, authenticated by Custodian,  evidencing the 100% undivided beneficial ownership interest in the Fannie Mae Mortgage Loans  set forth on Fannie Mae Form 2005 (Schedule of Mortgages).  “Fannie Mae Program” means the Fannie Mae Guaranteed Mortgage-Backed  Securities Programs, as described in the Fannie Mae Guide.  “Fannie Mae Security” means an ownership interest in a pool of Fannie Mae  Mortgage Loans, evidenced by a book-entry account in a depository institution having book-entry  accounts at the Federal Reserve Bank of New York, issued and guaranteed, with respect to timely  payment of interest and ultimate payment of principal, by Fannie Mae and backed by a pool of  Fannie Mae Mortgage Loans, in substantially the principal amount and with substantially the other  terms as specified with respect to such Fannie Mae Security in the related Takeout Commitment,  if any.  “FCA” means the United Kingdom Financial Conduct Authority.  “FDIA” means Title 12 United States Code, Section 1811 et seq., as amended from  time to time.  “FDIC” means the Federal Deposit Insurance Corporation or any successor thereto. “FHA” means the Federal Housing Administration, an agency within HUD, or any  successor thereto, and including the Federal Housing Commissioner and the Secretary of Housing  and Urban Development where appropriate under the FHA regulations.  “FHA 203k Loan” means a Mortgage Loan that is eligible for FHA’s 203(k) loan  program.  “FHA Buyout Loan” means an Eligible Mortgage Loan that (a) is insured by FHA,  (b) is a Ginnie Mae Mortgage Loan, (c) has been purchased out of a Ginnie Mae Security, and (d)  is not a Modified Loan.1318    1318 The definition of “FHA Buyout Loan” was added by Amendment No. 1, dated as of September 24, 2021.  

 

- 13 -    “FICO Score” means the credit score of the Mortgagor provided by Fair, Isaac &  Company, Inc. or such other organization providing credit scores on or immediately prior to the  origination of a Mortgage Loan.  “Final Completion Fee Installment” means the amount equal to the difference  between the Completion Fee and the Initial Completion Fee Installment.  “Final Purchase Price Installment” means the amount equal to the difference  between the Trade Principal and the Initial Purchase Price Installment.  “First-Lien State Bond Loans” means a State Bond Loan with respect to which the  Mortgage represents a first lien on the related Mortgaged Property.  “Floor” shall have the meaning assigned thereto in the Pricing Side Letter.19 “Freddie Mac” means the Federal Home Loan Mortgage Corporation, and its  successors in interest.   “Freddie Mac as Custodian” means, with respect to Freddie Mac Participation  Certificates, the circumstances in which Seller elects to appoint Freddie Mac (as opposed to some  other third party as permitted by the Freddie Mac Guide) as Custodian for the Freddie Mac  Mortgage Loans subject to the Freddie Mac Participation Certificates to be purchased by Purchaser  hereunder.  “Freddie Mac Guide” means the Freddie Mac Sellers’ and Servicers’ Guide, as such  Guide may hereafter from time to time be amended.  “Freddie Mac Mortgage Loan” means, with respect to any Freddie Mac  Participation Certificate or any Freddie Mac Security, a mortgage loan that is in Strict Compliance  on the related Purchase Date with the eligibility requirements specified for the applicable Freddie  Mac Program described in the Freddie Mac Guide.  “Freddie Mac Participation Certificate” means, with respect to the Freddie Mac  Program, a certificate, substantially in the form of Exhibit A, issued by Seller and authenticated  by Custodian, evidencing the 100% undivided beneficial ownership interest in the Freddie Mac  Mortgage Loans that are either (a) set forth on a copy of the Freddie Mac Form 1034 (Fixed-Rate  Custodial Certification Schedule) attached to such Participation Certificate or (b) identified on a  computer tape compatible with Selling System as belonging to the mortgage loan pool described  in such Participation Certificate. “Freddie Mac Program” means the Freddie Mac Home Mortgage Guarantor  Program or the Freddie Mac FHA/VA Home Mortgage Guarantor Program, as described in the  Freddie Mac Guide.  “Freddie Mac Security” means a modified pass-through mortgage-backed  participation certificate, evidenced by a book-entry account in a depository institution having    19 The definition of “Floor” was added by Amendment No. 2, dated as of April 28, 2022.  

 

- 14 -    book-entry accounts at the Federal Reserve Bank of New York, issued and guaranteed, with  respect to timely payment of interest and ultimate payment of principal, by Freddie Mac and  backed by a pool of Freddie Mac Mortgage Loans, in substantially the principal amount and with  substantially the other terms as specified with respect to such Freddie Mac Security in the related  Takeout Commitment, if any.   “GAAP” means generally accepted accounting principles as in effect from time to  time in the United States of America. “Ginnie Mae” means the Government National Mortgage Association and its  successors in interest, a wholly-owned corporate instrumentality of the government of the United  States of America.  “Ginnie Mae Guide” means the Ginnie Mae Mortgage-Backed Securities Guide, as  such Guide may hereafter from time to time be amended.  “Ginnie Mae Mortgage Loan” means, with respect to any Ginnie Mae Participation  Certificate or any Ginnie Mae Security, a mortgage loan that is in Strict Compliance on the related  Purchase Date with the eligibility requirements specified for the applicable Ginnie Mae Program  in the applicable Ginnie Mae Guide. “Ginnie Mae Participation Certificate” means, with respect to the Ginnie Mae  Program, a certificate, substantially in the form of Exhibit A, issued by Seller and authenticated  by Custodian, evidencing the 100% undivided beneficial ownership interest in the Ginnie Mae  Mortgage Loans set forth on the Form HUD 11706 (Schedule of Pooled Mortgages).  “Ginnie Mae Program” means the Ginnie Mae Mortgage-Backed Securities  Programs, as described in the Ginnie Mae Guide.  “Ginnie Mae Security” means a modified pass-through mortgage-backed certificate  guaranteed by Ginnie Mae, evidenced by a book-entry account in a depository institution having  book-entry accounts at the Federal Reserve Bank of New York and backed by a pool of Ginnie  Mae Mortgage Loans, in substantially the principal amount and with substantially the other terms  as specified with respect to such Ginnie Mae Security in the related Takeout Commitment.1420 “Governmental Authority” means any nation or government, any state or other  political subdivision, agency or instrumentality thereof, or any entity exercising executive,  legislative, judicial, regulatory or administrative functions of or pertaining to government and any  court or arbitrator having jurisdiction over Seller.   “High Cost Mortgage Loan” means a Mortgage Loan that is (a) subject to, covered  by or in violation of the provisions of the Homeownership and Equity Protection Act of 1994, as  amended, (b) a “high cost,” “covered,” “threshold,” “abusive,” “predatory” or “high risk”  mortgage loan under any federal, state or local law, or any similarly classified loan using different  terminology under any law imposing heightened regulation, scrutiny or additional legal liability    1420 The definition of “Ginnie Mae Security” was amended by Amendment No. 1, dated as of September 24,  2021.  

 

- 15 -    for residential mortgage loans having high interest rates, points and/or fees, or any other state or  other regulation providing assignee liability to holders of such mortgage loans, (c) subject to or in  violation of any such or comparable federal, state or local statutes or regulations, or (d) a “High  Cost Loan” or “Covered Loan,” as applicable, as such terms are defined in the current version of  the Standard & Poor’s LEVELS® Glossary Revised, Appendix E.  “Hsieh Investors” shall mean each of the JLSSAA Trust, established September 4,  2014, JLSA, LLC, Trilogy Mortgage Holdings, Inc., Trilogy Management Investors Six, LLC,  Trilogy Management Investors Seven, LLC and Trilogy Management Investors Eight, LLC and  each of their respective Affiliates. 1521 “HUD” means the Department of Housing and Urban Development, or any federal  agency or official thereof which may from time to time succeed to the functions thereof with regard  to FHA mortgage insurance.  The term “HUD,” for purposes of this Agreement, is also deemed to  include subdivisions thereof such as the FHA and Ginnie Mae.  “Indebtedness” has the meaning assigned thereto in the MRA Pricing Side Letter.  “Initial Completion Fee Installment” shall have the meaning assigned thereto the  Pricing Side Letter. “Initial Purchase Price Installment” means, with respect to any Participation  Certificate, the excess of the related Trade Principal over the Discount. “Intercreditor Agreement” means that certain Fourth Amended and Restated  Intercreditor Agreement, dated as of August 16, 2016, as amended through that certain  Amendment No. 7 and Joinder to Fourth Amended and Restated Intercreditor Agreement, dated  as of the date hereof, by and among Seller, Purchaser and the other parties thereto, as the same  may be amended, supplemented or otherwise modified from time to time.  “Issuance Date” means, with respect to a Security, the first day of the month in  which the Security is issued.  “Joint Securities Account Control Agreement” means that certain Fourth Amended  and Restated Joint Securities Account Control Agreement, dated as of August 16, 2016, as  amended through that certain Amendment No. 7 and Joinder to Fourth Amended and Restated  Joint Securities Account Control Agreement, dated as of the date hereof, by and among Seller,  Purchaser and the other parties thereto, as the same may be amended, supplemented or otherwise  modified from time to time. “Jumbo Mortgage Loan” means a first lien Mortgage Loan which (i) conforms with  all requirements of Seller’s underwriting guidelines, which are subject to Purchaser’s approval in  its sole good faith discretion, as the same may be amended, supplemented or otherwise modified    1521 The definition of “Hsieh Investors” was added by Amendment No. 1, dated as of September 24, 2021.      

 

- 16 -    from time to time and (ii) has the benefit of the safe harbor from liability under the ATR Rules or  a rebuttable presumption for such liability.22  “LIBOR” means for each day, the rate (adjusted for statutory reserve requirements  for eurocurrency liabilities) for eurodollar deposits for a period equal to one month appearing on  Bloomberg Screen US 0001M Page or if such rate ceases to appear on Bloomberg Screen US 0001M  Page, or any other service providing comparable rate quotations as selected by Purchaser or Agent  on behalf of Purchaser in good faith from time to time for purposes of providing quotations of interest  rates applicable to U.S. dollar deposits in the London interbank market) for deposits in Dollars with  a term equivalent to such Net Carry Adjustment Period, determined as of approximately 11:00 a.m.  (London time) two (2) Business Days prior to the first day of such Net Carry Adjustment Period;  provided that if the first day of such Net Carry Adjustment Period is not a Business Day, then LIBOR  shall be determined as of the immediately preceding Business Day, and provided further that LIBOR  for any such day shall not be less than the Floor.16 “Lien” means any mortgage, deed of trust, lien, claim, pledge, charge, security  interest or similar encumbrance.  “Loan-to-Value Ratio” means, as of any date of determination, the fraction,  expressed as a percentage, the numerator of which is the principal balance of the related Mortgage  Loan at such date and the denominator of which is the lesser of (a) the Appraised Value of the  Mortgaged Property at the origination or, if no appraisal was required, the “AUS estimated value,”  of such Mortgage Loan, and (b) if the Mortgaged Property was purchased within twelve (12)  months of the origination of the Mortgage Loan, the purchase price of the related Mortgaged  Property.   “Losses” means any and all claims, damages, losses, liabilities and all other  reasonable and documented expenses including out-of-pocket expenses (including, without  limitation, reasonable fees and expenses of outside counsel) imposed on, incurred by or asserted  against any Person specified.  “Master Netting Agreement” means that certain Global Netting and Security  Agreement, dated as of August 25, 2020, among Purchaser, Seller, and certain Affiliates of  Purchaser, entered into in connection with this Agreement and the Master Repurchase Agreement,  as the same shall be amended, supplemented or otherwise modified from time to time. “Master Repurchase Agreement” means that certain Master Repurchase  Agreement, dated as of the date hereof, by and among Purchaser, Agent and Seller, as the same  shall be amended, supplemented or otherwise modified from time to time. “Material Adverse Change” means, with respect to a Person, any material adverse  change in the business, financial condition, operations or Property of such Person including the  insolvency of such Person or its Parent Company, if applicable.    22 The definition of “LIBOR” was amended by Amendment No. 1, dated as of September 24, 2021, and  deleted by Amendment No. 2, dated as of April 28, 2022.  16 The definition of “Libor” was amended by Amendment No. 1, dated as of September 24, 2021.  

 

- 17 -    “Material Adverse Effect” means (a) a Material Adverse Change with respect to  Seller or any of its Affiliates that is a party to any Program Document; (b) a material impairment  of the ability of Seller or Servicer or any of their respective Affiliates that is a party to any Program  Document to perform under any Program Document to which it is a party; (c) a material adverse  effect upon the legality, validity, binding effect or enforceability of any Program Document against  Seller or any of its Affiliates that is a party to any Program Document; (d) a material adverse effect  on the Market Value of the Purchased Assets, taken as a whole; or (e) a material adverse effect on  the Approvals of Seller.  “Maturity Date” has the meaning assigned thereto in the MRA Pricing Side Letter. “Maximum Aggregate Purchase Price” has the meaning assigned thereto in the  MRA Pricing Side Letter.   “MERS” means Mortgage Electronic Registration Systems, Inc., a Delaware  corporation, or any successor in interest thereto.  “MERS Designated Mortgage Loan” means any Mortgage Loan as to which the  related Mortgage or Assignment of Mortgage, has been recorded in the name of MERS, as agent  for the holder from time to time of the Mortgage Note. “MERS System” means the system of recording transfers of mortgages electronically maintained by MERS.  “MIN” means the mortgage identification number of Mortgage Loans registered  with MERS on the MERS System. “Modified Loan” means an Eligible Mortgage Loan that (a) is insured by FHA or  guaranteed by the VA, (b) (1) was purchased out of a Ginnie Mae Security or from a third-party  whole loan investor solely as a result of modifications to such Eligible Mortgage Loan, or (2) was  purchased out of a Ginnie Mae Security or from a third-party whole loan investor as a result of  delinquent mortgage payments, but, without any loan modifications, subsequently became  reperforming and (c) is a Ginnie Mae Mortgage Loan.    “Monthly Payment” means the scheduled monthly payment of principal and  interest on a Mortgage Loan as adjusted in accordance with changes in the Mortgage Interest Rate  pursuant to the provisions of the Mortgage Note for an Adjustable Rate Mortgage Loan.  “Mortgage” means a mortgage, deed of trust or other security instrument, securing  a Mortgage Note.  “Mortgage File” has the meaning assigned thereto in the Custodial Agreement.  “Mortgage Loan” means a Ginnie Mae Mortgage Loan, a Fannie Mae Mortgage Loan,  an FHA 203k Loan, a Freddie Mac Mortgage Loan, a Jumbo Mortgage Loan, an Agency Scratch and Dent  

 

- 18 -    Mortgage Loan, an FHA Buyout Loan, a VA Buyout Loan, a Modified Loan, or a Wet-Ink Mortgage  Loan.1723 “Mortgage Interest Rate” means, with respect to each Mortgage Loan, the annual  rate at which interest accrues on such Mortgage Loan from time to time in accordance with the  provisions of the related Mortgage Note.  “Mortgage Note” means a promissory note or other evidence of indebtedness of the  obligor thereunder, evidencing a Mortgage Loan, and secured by the related Mortgage.  “Mortgaged Property” means the real property (or leasehold estate, if applicable)  securing repayment of the debt evidenced by a Mortgage Note.  “Mortgagee” means the record holder of a Mortgage Note secured by a Mortgage.  “Mortgagor” means the obligor or obligors on a Mortgage Note, including any  person who has assumed or guaranteed the obligations of the obligor thereunder.  “MRA Collection Account Control Agreement” means that certain Collection  Account Control Agreement, dated as of the date hereof, among Seller, Purchaser and the Bank  entered into in connection with the Master Repurchase Agreement, as the same shall be amended,  supplemented or otherwise modified from time to time.  “MRA Pricing Side Letter” means that certain Master Repurchase Agreement  Pricing Side Letter, dated as of the date hereof, between Seller and Purchaser, entered into in  connection with this Agreement, as the same may be amended, modified or supplemented from  time to time.  “MRA Program Documents” means the Master Repurchase Agreement, the MRA  Pricing Side Letter, the MRA Collection Account Control Agreement, any assignment of Hedge  Instrument, the Electronic Tracking Agreement, the Master Netting Agreement, the Escrow  Agreement, the Intercreditor Agreement, the Joint Securities Account Control Agreement, and all  other agreements, documents and instruments entered into by Seller on the one hand, and  Purchaser or one of its Affiliates (or Custodian on its behalf) and/or Agent or one of its Affiliates  on the other, in connection therewith with respect to the Transactions contemplated thereunder and  all amendments, restatements, modifications or supplements thereto.  “Negative Amortization” means the portion of interest accrued at the Mortgage  Interest Rate in any month which exceeds the Monthly Payment on the related Mortgage Loan for  such month and which, pursuant to the terms of the Mortgage Note, is added to the principal  balance of such Mortgage Loan.  “Net Carry Adjustment” means an amount (which may be a negative number) equal  to (a) the difference between (i) the product of (A) the rate of interest to be borne by the related  Security multiplied by the aggregate principal amount of the Related Mortgage Loans evidenced  by the related Participation Certificate, and (B) the number of days in the period beginning on the    1723 The definition of “Mortgage Loan” was amended by Amendment No. 1, dated as of September 24, 2021.  

 

- 19 -    Issuance Date of such Security, but excluding the related Settlement Date, and (ii) the product of  (A) the daily application of the applicable Transaction Rate to the Purchase Price, and (B) the  number of days in the period beginning on the date of the purchase of the related Participation  Certificate under this Agreement, but excluding the related Settlement Date, (b) divided by 360.  “Non-First-Lien State Bond Loans” means a State Bond Loan that is not a First- Lien State Bond Loan.”  “Non-QM Mortgage Loan” means either (a) a Mortgage Loan which does not have  the benefit of the safe harbor from liability under the ATR Rules or a rebuttable presumption for  such liability or (b) a Mortgage Loan secured by a one-to four-family residential investor property,  which in either case was underwritten and originated in accordance with underwriting guidelines  reasonably acceptable to Purchaser.  “Non-Utilization Fee” shall have the meaning assigned thereto in the MRA Pricing  Side Letter.  “Obligor” means a Person obligated to make payments pursuant to a Contract;  provided, that in the event that any payments in respect of a Contract are made by any other Person,  such other Person shall also be deemed to be an Obligor.  “OFAC” means the Office of Foreign Assets Control of the United States  Department of Treasury.  “OFAC Lists” has the meaning ascribed to it in Section 29(a).  “OFSI” means the Office of Financial Sanctions Implementation of the United  Kingdom’s HM Treasury.24  “Other Agreement” means any (i) warehouse, credit, repurchase, line of credit,  financing or hedging agreements or other similar agreement relating to any Indebtedness in an  amount greater than $10,000,000 between Seller or any of its Affiliates or Subsidiaries, on the one  hand, and any Person, on the other hand, or (ii) warehouse, credit, repurchase, line of credit,  financing or hedging agreements or other agreement relating to any Indebtedness (including,  without limitation, the Program Documents and the EPF Program Documents) in any amount  entered into between Seller or any of its Affiliates or Subsidiaries, on the one hand, and Purchaser  or any of its Affiliates, on the other hand.  “OTS” means Office of Thrift Supervision or any successor thereto.  “Parthenon Investors” shall mean each of Parthenon Investors III, L.P., PCap  Associates, Parthenon Capital Partners Fund, L.P., Parthenon Investors IV, L.P., Parthenon Capital  Partners Fund II, L.P. and PCP Managers, L.P. and each of their respective Affiliates. 1825   24 The definition of “OFSI” was added by Amendment No. 2, dated as of April 28, 2022; and the  definition of “OFAC Lists” was deleted by Amendment No. 2, dated as of April 28, 2022.  1825 The definition of “Parthenon Investors” was added by Amendment No. 1, dated as of September 24,  2021.  

 

- 20 -    “Pass Through Rate” means with respect to a Security, the rate of interest to be  borne by such Security, which rate or rates shall be set forth in the related Confirmation.  “Parent Company” means a corporation or other entity owning at least 50% of the  membership interests of Seller.  “Participation Certificate” means a Ginnie Mae Participation Certificate, a Fannie  Mae Participation Certificate or a Freddie Mac Participation Certificate, as applicable. “Permitted Holders” means the Parthenon Investors and the Hsieh Investors. 1926  “Person” means any legal person, including any individual, corporation,  partnership, association, joint stock company, trust, limited liability company, unincorporated  organization, governmental entity or other entity of similar nature.   “Pricing Side Letter” means the Pricing Side Letter, dated as of even date herewith,  between Seller and Purchaser entered into in connection with this Agreement, as amended,  supplemented or otherwise modified from time to time.  “Program Documents” means this Agreement, the Pricing Side Letter, the  Custodial Agreement, the Custodial Account Control Agreement, the Master Netting Agreement,  the Participation Certificates, the MRA Program Documents, any intercreditor agreement, and all  other agreements, entered into by Seller on the one hand, and Purchaser (or Custodian on its behalf)  and/or Agent or one of its Affiliates on the other, in connection herewith or therewith with respect  to the transactions contemplated hereunder or thereunder and all amendments, restatements,  modifications or supplements thereto.  “Property” means any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible.  “Purchase Date” means, with respect to a Participation Certificate, the date on  which such Participation Certificate is purchased by Purchaser.  “Purchase Price” has the meaning assigned thereto in the Pricing Side Letter. “Purchaser’s Wire Instructions” shall have the meaning assigned thereto in the  Pricing Side Letter. “Purchaser” has the meaning set forth in the preamble hereof.  “Related Mortgage Loan” means a Mortgage Loan in which a Participation  Certificate evidences the 100% undivided beneficial ownership interest.      1926 The definition of “Permitted Holder” was added by Amendment No. 1, dated as of September 24, 2021.      

 

- 21 -    “Related Participation Certificate” means the Participation Certificate relating to a  pool of Mortgage Loans.  “Relevant Governmental Body” means the Federal Reserve Board and/or the  Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal  Reserve Board and/or the Federal Reserve Bank of New York or any successor thereto.  “Request for Release and Receipt” means the Request for Release and Receipt set  forth as Annex 5 to the Custodial Agreement.  “Responsible Officer” means (i) as to any Person, the chief executive officer or,  with respect to financial matters, the chief financial officer of such Person and (ii) as to Seller,  Chief Executive Officer, Chief Financial Officer or Treasurer. “Restricted Mortgage Loan” means (i) a “Manufactured Home Loan,” “Graduated  Payment Loan,” “Buydown Loan,” “Project Loan,” “Construction Loan” or “HECM Loan,” each  as defined in the applicable Agency Guide, (ii) a 30+ Day Delinquent Mortgage Loan, (iii) a  Mortgage Loan for which the related Escrow Payments have not been made by the next succeeding  Due Date, or (iv) a High Cost Mortgage Loan.  “Sanctions List” has the meaning ascribed to it in Section 29(a).27 “SEC” means the Securities Exchange Commission or any successor thereto.  “Security” means a Ginnie Mae Security, a Fannie Mae Security or a Freddie Mac  Security, as applicable.  “Security Issuance Failure” means failure of the Security to be issued for any reason  whatsoever by the Anticipated Delivery Date.  “Security Settlement Fee” shall have the meaning assigned thereto in the Pricing  Side Letter.  “Selling System” means the Freddie Mac automated system by which sellers and  servicers of mortgage loans to Freddie Mac transfer mortgage summary and record data or  mortgage accounting and servicing information from their computer system or service bureau to  Freddie Mac, as more fully described in the Freddie Mac Guide. “Servicer Side Letter” has the meaning assigned thereto in the Master Repurchase  Agreement. “Servicing File” means with respect to each Mortgage Loan, the file retained by  Seller or its designee consisting of all documents that are customarily retained by servicers that  service mortgage loans substantially similar to such Mortgage Loan, which would include  copies  of the Mortgage File,  all documents necessary to document and service the Mortgage Loans and    27 The definition of “Sanctions List” was added by Amendment No. 2, dated as of April 28, 2022.  

 

- 22 -    any and all documents required to be delivered in connection with any transfer of servicing  pursuant to the Program Documents.  “Servicing Records” means, with respect to a Related Mortgage Loan, the related  servicing records, including but not limited to any and all servicing agreements, files, documents,  records, data bases, computer tapes, copies of computer tapes, proof of insurance coverage,  insurance policies, appraisals, other closing documentation, payment history records, and any other  records relating to or evidencing the servicing of such Related Mortgage Loan.  “Servicing Term” shall have the meaning assigned thereto in Section 6(a).  “Servicing Termination Events” shall have the meaning assigned thereto in  Section 6(e).  “Settlement Date” means the date specified in a Takeout Commitment upon which  the related Security is scheduled to be delivered to the specified Takeout Investor on a “delivery  versus payment” basis.  “SOFR” means a rate per annum equal to, with respect to any day, the secured  overnight financing rate for such Business Day published by the Federal Reserve Bank of New  York (or a successor administrator of the secured overnight financing rate) on the website  of the Federal Reserve Bank of New Yorkpublished for such day by the SOFR Administrator  on the SOFR Administrator’s website, currently at http://www.newyorkfed.org (, or any  successor source for the secured overnight financing rate identified as such by the  administrator of the secured overnight financing rateSOFR Administrator from time to  time).20212829 “SOFR Administrator” means the Federal Reserve Bank of New York, as  administrator of SOFR (or a successor administrator).30   “Strict Compliance” means compliance of Seller and the Related Mortgage Loans  with the requirements of the Agency Guide as amended by any agreements between Seller or a  Takeout Investor, on the one hand, and the Applicable Agency, on the other hand, sufficient to  enable Seller to issue and to service and Ginnie Mae to guarantee or Fannie Mae or Freddie Mac  to issue and guarantee a Security.    “Subsidiary” means, with respect to any Person, any corporation, partnership or  other entity of which at least a majority of the securities or other ownership interests having by the  terms thereof ordinary voting power to elect a majority of the board of directors or other persons  performing similar functions of such corporation, partnership or other entity (irrespective of  whether or not at the time securities or other ownership interests of any other class or classes of    20 The definition of “SOFR” was amended by Amendment No. 1, dated as of September 24, 2021.  2128 The definition of “SOFR Based Rate” was removedamended by Amendment No. 1, dated as of  September 24, 2021., and Amendment No. 2, dated as of April 28, 2022.    29 The definition of “SOFR Based Rate” was deleted by Amendment No. 1, dated as of September 24,  2021.  30 The definition of “SOFR Administrator” was added Amendment No. 2, dated as of April 28, 2022.  

 

- 23 -    such corporation, partnership or other entity shall have or might have voting power by reason of  the happening of any contingency) is at the time directly or indirectly owned or controlled by such  Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries  of such Person.  Notwithstanding the foregoing, none of ) Farm Bureau Mortgage, LLC, LGI  Mortgage Solutions LLC, Henlopen Mortgage, LLC, BRP Home Mortgage, LLC,  MTH  Mortgage, LLC, MSC Mortgage, LLC, TRI Pointe Connect, LLC, Day One Mortgage, LLC,  CUSA Affordable Housing, LLC, Commercial Agency USA, LLC, LD Escrow, Inc. or any joint  venture formed by Seller after the date hereof, shall be considered a Subsidiary for purposes of  this Agreement or any other Program Document.2231  “Successor Servicer” means an entity with the necessary Approvals, as the  circumstances may require, and designated by Purchaser, in conformity with Section 6(f), to  replace Seller as issuer and subservicer, mortgagee or seller/servicer of the Related Mortgage  Loans or the Securities related thereto. “Takeout Commitment” means a (i) a trade confirmation (which may be delivered  electronically) from the related Takeout Investor to Seller confirming the details of a forward trade  between the Takeout Investor and Seller with respect to one or more Securities relating to a  Participation Certificate, which trade confirmation shall be enforceable and in full force and effect,  and shall be validly and effectively assigned to BCI pursuant to a Trade Assignment, and relate to  pools of Related Mortgage Loans that satisfy the “good delivery standards” of the Securities  Industry and Financial Markets Association as set forth in the Securities Industry and Financial  Markets Association Uniform Practices Manual, as amended from time to time or (ii) a  commitment of Seller (a) to swap one or more identified Related Mortgage Loans with a Takeout  Investor that is an Agency for a Security and (b) to sell the related Security or Takeout MBS to a  Takeout Investor.  “Takeout Investor” means (x) for non-Jumbo Mortgage Loans, any of (i) Barclays  Capital, Inc., or any successor thereto, (ii) any member of the Mortgage Backed Securities Division  of the Fixed Income Clearing Corporation, unless such member is disapproved by Agent in its  reasonable discretion or (iii) any other Person listed on Exhibit J to the Master Repurchase  Agreement, which may be updated from time with the consent of the Agent (such consent not to  be unreasonably withheld) by delivery of an updated Exhibit J to the Master Repurchase  Agreement and (y) for Jumbo Mortgage Loans, either (i) Barclays Bank PLC or (ii) any other  Person listed on Exhibit J to the Master Repurchase Agreement, which may be updated from time  with the consent of the Agent (such consent not to be unreasonably withheld) by delivery of an  updated Exhibit J to the Master Repurchase Agreement.  “Termination Date” means the earliest to occur of (i) the Maturity Date, (ii) the  termination of the Master Repurchase Agreement, or (iii) at the option of Purchaser, the occurrence  of a Servicing Termination Event under this Agreement after the expiration of any applicable grace  period.   “Term SOFR” means, with respect to any date of determination, the forward- looking term rate based on SOFR, for a corresponding tenor of one month, as of two (2)    2231 The definition of “Subsidiary” was amended by Amendment No. 1, dated as of September 24, 2021.  

 

- 24 -    Business Days prior to the first day of the corresponding Accrual Period containing such  date of determination, as such rate is published by the Term SOFR Administrator; provided,  however, that if as of 5:00 p.m. (New York City time) on any such date Term SOFR has not  been published by the Term SOFR Administrator and a Benchmark Replacement Date with  respect to Term SOFR has not occurred, then Term SOFR will be the Term SOFR as  published by the Term SOFR Administrator on the first preceding Business Day for which  such Term SOFR was published by the Term SOFR Administrator so long as such first  preceding Business Day is not more than three (3) Business Days prior to such determination  date.32  “Term SOFR” means the Administrator” means CME Group Benchmark  Administration Limited (or any successor administrator of a forward-looking term rate based  on SOFR that has been selected or recommended by the Relevant Governmental Body.rate  approved by Purchaser in its sole discretion).33  “Trade Assignment” means a letter substantially in the form of Exhibit B.  “Trade Price” means the price (expressed as a percentage of the initial principal  amount of the Security), as specified in the related Takeout Commitment at which the related  Takeout Investor is obligated to purchase such Security as specified in such Takeout Commitment.  “Trade Principal” means an amount equal to the product of (a) the Trade Price and  (b) the initial principal amount of the related Security, as specified in the related Takeout  Commitment. “Transaction Fee” shall have the meaning assigned thereto in the MRA Pricing Side  Letter.  “Transaction Rate” shall have the meaning assigned thereto in the Pricing Side  Letter.  “Unsecured Term Loan” shall have the meaning assigned thereto in the Master  Repurchase Agreement.   “U.S. Government Securities Business Day” means any day except for (a) a  Saturday, (b) a Sunday or (c) a day on which the U.S. Securities Industry and Financial  Markets Association recommends that the fixed income departments of its members be  closed for the entire day for purposes of trading in United States government securities.34 “VA” means the United States Department of Veterans Affairs or any successor  thereto.    32 The definition of “Term SOFR” was amended by Amendment No. 2, dated as of April 28, 2022.  33 The definition of “Term SOFR Administrator” was added by Amendment No. 2, dated as of April  28, 2022.  34 The definition of “U.S. Government Securities Business Day” was added by Amendment No. 2, dated  as of April 28, 2022.  

 

- 25 -    “VA Buyout Loan” means an Eligible Mortgage Loan that (a) is guaranteed by VA, (b) is  a Ginnie Mae Mortgage Loan, (c) has been purchased out of a Ginnie Mae Security, and (d) is not a  Modified Loan.2335   “Warehouse Lender” means any lender providing financing to Seller for the  purpose of warehousing, originating or purchasing a Mortgage Loan, which lender has a security  interest in such Mortgage Loan to be purchased by Purchaser.  “Warehouse Lender’s Release” means a letter, in the form of Exhibit D, from a  Warehouse Lender to Purchaser, unconditionally releasing all of Warehouse Lender’s right, title  and interest in certain Mortgage Loans identified therein upon payment to the Warehouse Lender.  “Wet-Ink Mortgage Loan” means a Mortgage Loan that Seller is selling to  Purchaser simultaneously with the origination thereof that is funded as part, either directly or  indirectly, with the Initial Purchase Price paid by Purchaser hereunder and for which the Custodian  shall not have received a complete Mortgage File.2436  Section 2. Procedures for Purchases of Participation Certificates.  (a) Purchaser may, in its sole discretion from time to time until the Termination  Date, but shall have no obligation to, purchase one or more Participation Certificates from Seller;  provided, that the sum of (i) the Aggregate MRA Purchase Price and (ii) the Aggregate EPF  Purchase Price shall not exceed, as of any date of determination, the Maximum Aggregate  Purchase Price. In connection with Purchaser’s purchase of any such Participation Certificate,  Seller, on behalf of Purchaser, shall arrange for the Delivery to BCI of a Security backed by the  Related Mortgage Loans, which Security shall be subject to a Takeout Commitment. The purchase  of any Participation Certificate shall be subject to the receipt by Purchaser of the items listed in  Section 2(f) and (g) from Seller, in form and substance satisfactory to Agent. In accordance with  the provisions of the Electronic Tracking Agreement, the Seller shall, at its sole cost and expense,  (1) cause each Related Mortgage Loan with respect to which a Participation Certificate is to be  sold to the Purchaser on a Purchase Date, the Mortgage for which is recorded in the name of  MERS, to be designated a MERS Mortgage Loan and (2) cause the Purchaser to be designated an  “associated member” (as defined in the Electronic Tracking Agreement) with respect to each such  MERS Mortgage Loan. Notwithstanding the satisfaction of the conditions specified in this  Section 2(a) or anything else herein or in any other Program Document to the contrary, Purchaser  is not obligated to purchase any Participation Certificate offered to it hereunder.   (b) If Purchaser elects to purchase any Participation Certificate, the parties shall  execute a Confirmation with respect to such Participation Certificate reflecting the agreed-upon  terms of the transaction, and shall pay to Seller, on the Purchase Date, the amount of the Initial  Purchase Price Installment for such Participation Certificate upon receipt of a duly executed and  properly completed original Participation Certificate. Effective upon execution and delivery of  such Participation Certificate to Purchaser, Seller hereby assigns to Purchaser all of Seller’s right,  title and interest in and to, and control over, such Participation Certificate and a 100% undivided   2335 The definition of “VA Buyout Loan” was added by Amendment No. 1, dated as of September 24, 2021.  2436 The definition of “Wet-Ink Mortgage Loan” was added by Amendment No. 1, dated as of September 24,  2021.  

 

- 26 -    beneficial interest in the Related Mortgage Loans. In the event that Purchaser does not transmit  the Initial Purchase Price Installment, (i) any Participation Certificate delivered by Custodian to  Purchaser in anticipation of such purchase shall automatically be null and void and Purchaser shall  promptly return it to Seller, (ii) Purchaser will not deliver the applicable Trade Assignment to the  applicable Takeout Investor (or, if already delivered, will revoke it) or consummate the  transactions contemplated in the applicable Trade Assignment and (iii) to the extent that Purchaser  shall nevertheless receive the Security backed by the Related Mortgage Loans prior to the  Participation Certificate becoming null and void as provided in clause (i) above, Purchaser shall  take all reasonable actions necessary to ensure that such Security shall be delivered in accordance  with delivery instructions provided by Seller.  (c) The terms and conditions of the purchase of each Participation Certificate  shall be as set forth in this Agreement. Each Participation Certificate shall be deemed to  incorporate, and Seller shall be deemed to make as of the applicable dates specified in Section 9,  for the benefit of Purchaser and each Assignee of such Participation Certificate, the representations  and warranties set forth in Section 9.  (d) Purchaser shall provide a Confirmation to Seller on or before the Purchase  Date or as soon as practicable after the Purchase Date. In the event of any conflict between the  terms of a Confirmation and this Agreement, the Confirmation shall prevail.  (e) For the avoidance of any doubt, it is hereby understood and agreed that  Purchaser’s purchase of the beneficial ownership interest in and to Related Mortgage Loans, as  evidenced by a Participation Certificate, shall include a beneficial ownership interest in and to all  of the servicing rights relating to such Mortgage Loans.   (f) On or prior to the Effective Date, except as otherwise specified below,  Purchaser shall have received the following, in form and substance reasonably satisfactory to  Purchaser and Agent and duly executed by each party thereto (as applicable):  (i) Each of the Program Documents duly executed and delivered by the  parties thereto and being in full force and effect, free of any modification, breach or waiver;  (ii) A copy of an officer’s certificate in a form reasonably satisfactory  to Purchaser, together with (1) the certificate of formation of Seller and any amendments  thereto, certified by the Secretary of State of Seller’s state of formation, (2) a copy of  Seller’s operating agreement, together with any amendments thereto, (3) a copy of the duly  authorized corporate resolutions, authorizing Seller to enter into this Agreement and the  other Program Documents to which it is a party, and authorizing one or more of Seller’s  officers to execute the documents related to this Agreement and the other Program  Documents to which it is a party;  (iii) No later than three (3) Business Days after the Effective Date, an  opinion of Seller’s counsel as to such matters as Purchaser or Agent may reasonably  request (including, without limitation, a non-contravention, enforceability and corporate  opinion with respect to Seller; an opinion with respect to the inapplicability of the  

 

- 27 -    Investment Company Act to Seller), each in form and substance reasonably acceptable to  Purchaser and Agent; and   (iv) No later than ten (10) Business Days after the Effective Date, an  opinion of Seller’s counsel that the relevant provisions of this Agreement constitute a  “securities contract” within the meaning of the Bankruptcy Code and that none of the  transactions contemplated hereunder constitute an avoidable transfer under Section 546(f)  of the Bankruptcy Code, in form and substance reasonably acceptable to Purchaser and  Agent; and  (v) Evidence that all other actions necessary or, in the opinion of Agent,  desirable to perfect and protect Purchaser’s interest in the Related Mortgage Loans and  other Collateral have been taken, including, without limitation, duly filed Uniform  Commercial Code financing statements on Form UCC1.  (g) In addition to those items listed in Section 2(a) and (b), prior to each  Purchase Date, the following shall have occurred:  (i) Seller shall have paid to Purchaser:   (A) all accrued and unpaid fees and expenses owed to Purchaser  that have been invoiced in accordance with the Program Documents in U.S.  dollars, in immediately available funds, without deduction, setoff or counterclaim;  and   (B) the Security Settlement Fee for the related Participation  Certificate as required under Section 2 of the Pricing Side Letter in U.S. dollars,  in immediately available funds, without deduction, setoff or counterclaim;  provided that Purchaser may, in its sole discretion, net any unpaid Security  Settlement Fee from the proceeds of any Purchase Price paid by Purchaser to  Seller.  (ii) The fully completed, executed and authenticated Participation  Certificate together with the certifications of the Custodian provided by Section 2 of the  Custodial Agreement or, with respect to a Security, such Security shall have been delivered  to the Purchaser;  (iii) A Trade Assignment (unless Purchaser is the Takeout Investor),  fully completed and duly executed by Seller and the related Takeout Investor, together with  either (a) a copy of a Takeout Commitment with respect to the Security to be backed by  the Related Mortgage Loans evidenced by such Participation Certificate or (b) a letter from  Seller confirming the details of such Takeout Commitment shall have been delivered to  Purchaser;  (iv) A letter from any warehouse lender having a security interest in the  Related Mortgage Loans, substantially in the form of Exhibit D, addressed to Purchaser,  releasing any and all right, title and interest in such Related Mortgage Loans shall have  been delivered to Purchaser;  

 

- 28 -    (v) All representations and warranties made by Seller in this Agreement  are true and correct in all material respects; and (vi) No Servicing Termination Event has occurred and is continuing.  Section 3. Takeout Commitments.  Seller hereby assigns to BCI, free of any security interest, lien, claim or  encumbrance of any kind, Seller’s rights under each Takeout Commitment to deliver the Security  specified therein to the related Takeout Investor and to receive the purchase price therefor from  such Takeout Investor. Subject to Purchaser’s rights hereunder, Purchaser agrees that it will cause  BCI to satisfy the obligation under the Takeout Commitment to deliver the Security to the Takeout  Investor on the Settlement Date specified therein. Seller understands that, as a result of this  Section 3 and each Trade Assignment, BCI will succeed to the rights and obligations of Seller with  respect to each Takeout Commitment subject to a Trade Assignment, and that in satisfying each  such Takeout Commitment, BCI will stand in the shoes of Seller and, consequently, will be acting  as a non-dealer in exercising its rights and fulfilling its obligations assigned pursuant to this  Section 3 and each Trade Assignment. Each Trade Assignment delivered by Seller to Purchaser  shall be delivered by Seller in a timely manner sufficient to enable BCI to facilitate the settlement  of the related trade on the trade date in accordance with Chapter 8 of the Securities Industry and  Financial Markets Association’s Uniform Practices for the Clearance and Settlement of Mortgage  Backed Securities and other Related Securities, as amended from time to time.  Section 4. Completion Fee.  (a) Subject to the terms of this Agreement, Purchaser shall pay to Seller the  Completion Fee for each Participation Certificate that Purchaser elects to purchase hereunder as  follows: (i) the Initial Completion Fee Installment shall be paid on the date of Delivery of the  related Security and (ii) the Final Completion Fee Installment shall be paid on the later to occur of  the Settlement Date of the related Security and the date of receipt by BCI of the Trade Price with  respect to such related Security.   (b) Except as otherwise provided in this Section 4 and in Section 5(b), and  subject to Purchaser’s right of set-off set forth in Section 12, the Completion Fee owed by  Purchaser with respect to a Participation Certificate, if any, shall be paid by Purchaser to Seller in  full by not later than the Settlement Date of the related Security in accordance with the following  wire instructions:  Wire Transfer Field  Description  ABA Number  121000248  Bank Name Wells Fargo Bank, N.A. Bank Address, City, State 420 Montgomery Street  San Francisco, CA 94104  (regardless of where the account is located)  BIC (SWIFT Routing)  WFBIUS6S  Beneficiary Account Number 4988640066  

 

- 29 -    Beneficiary Name  LD MBS  Amount of Wire   Optional Originator to Beneficiary information (any  additional information that you want to note  within the wire).  For International Transfer Only International SWIFT BIC WFBIUS6S CHIPS Participant Only  UID ABA 0407  (c) Upon exercise by Purchaser of its remedies under Section 6(f), Purchaser’s  obligation to pay and Seller’s right to receive any portion of the Completion Fee relating to such  Related Mortgage Loans shall automatically be canceled and become null and void; provided, that such cancellation shall in no way relieve Seller or otherwise affect the obligation of Seller to  indemnify and hold Purchaser and Agent harmless as specified in Section 13. At no time shall  Seller have any beneficial interest in the servicing rights with respect to Related Mortgage Loans  while the related Participation Certificate is outstanding.   (d) If a Participation Certificate is purchased by Purchaser after the first day of  the month in which the Settlement Date occurs, Purchaser shall also pay to Seller on the date of  Delivery to Purchaser of the Security backed by the related Mortgage Loans an amount equal to  the accrued interest on the related Security at the rate specified in the related Takeout Commitment  from the first day of such month to and including the day immediately preceding the date Purchaser  purchased such Participation Certificate. If a Participation Certificate is purchased by Purchaser in  the month prior to the month in which the Settlement Date occurs, the Completion Fee shall be  reduced by an amount equal to all interest payments which accrue on such Participation Certificate  during the period from the date of purchase of such Participation Certificate through and including  the last day of the month prior to the month in which such Settlement Date occurs.  Section 5. Issuance of Securities.   (a) (i) In connection with the purchase of a Participation Certificate, Seller shall  instruct (and, if Seller fails to instruct, then Agent may instruct) Custodian to deliver to the  Applicable Agency, the documents listed in Annex 19-A, 19-B or 19-C of the Custodial  Agreement, as applicable, in respect of the Related Mortgage Loans, in the manner and at the time set forth in the Custodial Agreement. Seller shall thereafter promptly deliver to the Applicable  Agency any and all additional documents requested by the Applicable Agency to enable the  Applicable Agency to make Delivery to Purchaser of a Security backed by such Mortgage Loans  on the related Anticipated Delivery Date. Seller shall not revoke such instructions to Custodian  and shall not revoke its instructions to the Applicable Agency to make Delivery to Purchaser or its  designee of a Security backed by such Mortgage Loans. The Delivery to Purchaser of a Security  shall be made in accordance with the following delivery instructions:   Fed Book Entry Securities (MBS)  ABA: 021000018    Bank of NYC/BCMBS    

 

- 30 -    (ii) Seller shall notify Purchaser, not later than 12:00 noon, Eastern  Time, on the second (2nd) Business Day prior to the applicable Settlement Date (a) of the amount  of any change in the principal amount of the Mortgage Loans backing each such Security related  to such Settlement Date and (b) with respect to Freddie Mac Securities, the Freddie Mac mortgage  loan pool number applicable to each Security to which such Settlement Date relates. Upon  Delivery of such Security to BCI or its designee, Purchaser shall cease to have any interest under  such Participation Certificate and in exchange shall have a 100% ownership interest in the related  Security. It is understood and agreed that for so long as Seller is subservicing Related Mortgage  Loans, Seller shall retain only record title to the Mortgages (and not an equitable interest) in all  such Mortgage Loans (other than MERS Designated Mortgage Loans) for the sole purpose of  subservicing such Mortgage Loans on a servicing-released basis.  (b) If Delivery of a Security backed by the Mortgage Loans evidenced by a  Participation Certificate purchased hereunder has not occurred by 12:00 noon (Eastern Time) on  the related Settlement Date as a result of a Security Issuance Failure or otherwise, then subject to  the exercise by Purchaser of its rights set forth in Section 4(c), the Completion Fee relating to such  Participation Certificate shall be reduced on each day during the period from the Settlement Date  to (but not including) the earlier of (x) the date of Delivery of such Security, and (y) the date of  satisfaction of the obligations of Seller pursuant to the exercise by Purchaser of any remedial  election authorized by this Section 5, by an amount equal to the Daily Completion Fee Reduction  Amount. The Completion Fee (reduced by the applicable Daily Completion Fee Reduction  Amounts) relating to such Participation Certificate, if any, shall not be payable until the end of the  period specified in the preceding sentence.  (c) If a breach by Seller of this Agreement results in any Related Mortgage  Loan being a Defective Mortgage Loan on the Purchase Date of the related Participation Certificate  to Purchaser, Agent in its sole discretion may require that Seller, upon receipt of notice from  Purchaser or Agent of its exercise of such right, to either (x) immediately repurchase Purchaser’s  beneficial ownership interest in such Defective Mortgage Loan by remitting to Purchaser the  allocable amount paid by Purchaser for such beneficial interest plus accrued interest at the rate  specified in the related Mortgage Note on the principal amount thereof from the date of Purchaser’s  purchase of such Participation Certificate to the date of such repurchase together with any Losses  suffered by Purchaser relating to such repurchase (including, without limitation, any Losses  incurred by Purchaser resulting from adjustments to the trade required by the Takeout Investor),  or (y) deliver to Custodian a Mortgage Loan eligible to back such Security in exchange for such  Defective Mortgage Loan, which newly delivered Mortgage Loan shall be in all respects  acceptable to Agent in Agent’s reasonable discretion, and such newly delivered Mortgage Loan  will thereupon become one of the Related Mortgage Loans relating to the Participation Certificate.  If the aggregate principal balance of any Mortgage Loans that are accepted by Purchaser pursuant  to clause (y) of the immediately preceding sentence is less than the aggregate principal balance of  any Defective Mortgage Loan that is being replaced by such Mortgage Loan, Seller shall remit  with such Mortgage Loan to Purchaser an amount equal to the difference between the aggregate  principal balance of the new Mortgage Loan accepted by Purchaser and the aggregate principal  balance of the Defective Mortgage Loan being replaced thereby plus accrued interest on such  Defective Mortgage Loan at the rate specified in the related Mortgage Note on the principal  amount thereof from the Purchase Date of Purchaser’s purchase of such Participation Certificate  to the date of substitution.   

 

- 31 -    (d) If any Related Mortgage Loan becomes thirty (30) days or more Delinquent  with respect to the first scheduled monthly payment due Purchaser after the date on which such  Related Mortgage Loan was originated and prior to the Anticipated Delivery Date, Seller shall  repurchase the beneficial interest in such Related Mortgage Loan as if it were a Defective  Mortgage Loan upon direction by Agent given no later than one hundred twenty (120) days after  the Purchase Date. (e) No exercise by Purchaser or Agent of their respective rights under this  Section 5 shall relieve Seller of responsibility or liability for any breach of this Agreement.  Section 6. Servicing of the Mortgage Loans; Servicer Termination; Backup Servicer.  (a) Upon payment of the Initial Purchase Price Installment with respect to a  Participation Certificate and so long as such Participation Certificate remains outstanding (subject  to Section 4), Purchaser shall own a 100% undivided beneficial interest in the servicing rights  related to the Related Mortgage Loans, including the Mortgage File related to such Related  Mortgage Loans. Seller and Purchaser each agrees and acknowledges that a 100% undivided  beneficial interest in Related Mortgage Loans shall be sold to Purchaser on a servicing released  basis, and that Purchaser is engaging and hereby does engage Seller (or a subservicer designated  by Seller) to provide subservicing of each Related Mortgage Loan for the benefit of Purchaser (and  any other registered holder of the related Participation Certificate) for each transaction for a term  of thirty (30) days from the related Purchase Date (subject to the termination rights provided in  this Agreement, including, without limitation, Section 6(f) of this Agreement), which term may be  extended in writing by Purchaser, in its sole discretion, for additional thirty (30) day periods (each, a “Servicing Term”). If such Servicing Term is not extended by Purchaser or if Purchaser has  terminated Seller as a result of a Servicing Termination Event, Seller shall transfer such servicing  to Purchaser or its designee at no cost or expense to Purchaser as provided in Section 6(g) of this  Agreement. Seller shall hold or cause to be held all Escrow Payments collected with respect to the  Related Mortgage Loans in segregated accounts for the sole benefit of the Mortgagors and shall  apply the same for the purposes for which such funds were collected. If Seller should discover  that, for any reason whatsoever, it has failed to perform fully its servicing obligations in any  material respect with respect to the Related Mortgage Loans, Seller shall promptly notify  Purchaser. The parties hereto acknowledge and agree that as of the Effective Date, Seller may  delegate its obligations hereunder to subservice any or all of the Related Mortgage Loans to Cenlar  FSB.  For so long as a Participation Certificate is outstanding, Seller shall neither assign,  encumber or pledge its right to servicing compensation hereunder or its obligation to subservice  the Related Mortgage Loans in whole or in part, nor delegate its rights or duties under this  Agreement (other than to a subservicer (including, without limitation, Cenlar FSB)) without the  prior written consent of Agent, the granting of which consent shall be in the sole discretion of  Agent. Seller hereby acknowledges and agrees that (i) Purchaser is entering into this Agreement  in reliance upon Seller’s representations as to the adequacy of its financial standing, servicing  facilities, personnel, records, procedures, reputation and integrity, and the continuance thereof; and  (ii) Seller’s engagement hereunder to provide mortgage servicing for the benefit of Purchaser (and  any other registered holder of the Participation Certificate) is intended by the parties to be a  

 

- 32 -    “personal service contract” and Seller is hereunder intended by the parties to be an “independent  contractor”.  (b) (i) Seller (or a subservicer designated by Seller (including, without  limitation, Cenlar FSB)) shall subservice and administer the Related Mortgage Loans relating to a  Participation Certificate on behalf of Purchaser in accordance with Accepted Servicing Practices.  Seller shall have no right to modify or alter the terms of any Related Mortgage Loan or consent to  the modification or alteration of the terms of any Related Mortgage Loan except in Strict  Compliance with the related Agency Program. Seller (or a subservicer designated by Seller  (including, without limitation, Cenlar FSB)) shall at all times maintain accurate and complete  records of its servicing of the Related Mortgage Loans, and Agent may, at any time during Seller’s  business hours on reasonable notice, examine and make copies of such Servicing Records. Seller  agrees that Purchaser is the 100% beneficial owner of all Servicing Records relating to the Related  Mortgage Loans. Seller covenants to hold or cause any designated subservicer to hold such  Servicing Records for the benefit of Purchaser and to safeguard such Servicing Records and to  deliver them promptly to Agent or its designee (including the Custodian) at Agent’s request or  otherwise as required by operation of this Section 6.   (ii) If Delivery of a Security is not made to Purchaser on or before the  Anticipated Delivery Date, Seller (or a subservicer designated by Seller (including, without  limitation, Cenlar FSB)) shall deliver to Purchaser, upon reasonable request by Purchaser,  reports regarding the status of those Related Mortgage Loans for which a Security has not  yet been issued, which reports shall include, but shall not be limited to, a description of  those Related Mortgage Loans thirty (30) days or more Delinquent, and such other  circumstances with respect to any Related Mortgage Loans (whether or not such Related  Mortgage Loans are included in the foregoing list) that could materially adversely affect  any of such Related Mortgage Loans, Purchaser’s beneficial interest in such Related  Mortgage Loans or the collateral securing any of such Related Mortgage Loans. Seller (or  a subservicer designated by Seller (including, without limitation, Cenlar FSB)) shall deliver  such a report to Purchaser upon such request of Purchaser until (i) Delivery of the related  Security to Purchaser or (ii) the exercise by Purchaser of any remedial election pursuant to  Section 5. In no event shall Seller delegate any of its subservicing duties hereunder (other  than to Cenlar FSB) to any other Person without first obtaining the prior written consent of  Purchaser.  (iii) Upon the request of Purchaser or Agent from time to time, Seller  shall furnish to Purchaser and Agent reports in form and scope satisfactory to Agent, setting  forth (i) data regarding the performance of the individual Related Mortgage Loans, (ii) a  summary report of all Related Mortgage Loans serviced by the Seller and originated  pursuant to an Agency Guide, HUD and/or FHA guidelines (on a portfolio basis), in each  case, for the immediately preceding month, including, without limitation, all collections,  delinquencies, defaults, defects, claim rates, losses and recoveries, and (iii) any other  information reasonably requested by Purchaser or Agent.  (c) Seller, as servicer, shall establish and maintain the “Custodial Account”  with Bank entitled “loanDepot.com, LLC Custodial Account, for the benefit of Barclays Bank  PLC and its assignees.”  The Custodial Account shall be subject to the terms and conditions of the  

 

- 33 -    Custodial Account Control Agreement.  Following the occurrence and during the continuance of  an Event of Default, Seller shall deposit or cause to be deposited into such account in the form  received within two (2) Business Days of receipt thereof, with any necessary endorsements, all  collections received in respect of the Related Mortgage Loans relating to Participation Certificates  purchased by Purchaser hereunder.  (d) Upon the occurrence and continuance of an Event of Default, amounts  deposited in the Custodial Account with respect to any Related Mortgage Loan relating to  Participation Certificates purchased by Purchaser hereunder shall be held in trust for the benefit of  Purchaser and shall be released only as follows: (i) Except as otherwise provided in Section 6(d)(ii), upon either (x) the  Settlement Date (unless there is a Securities Issuance Failure) or (y) if earlier, on the date  required by the applicable Agency Guide, amounts deposited in the Custodial Account  shall be released to Seller. Notwithstanding the foregoing, all amounts relating to  Participation Certificates purchased by Purchaser hereunder and deposited in the Custodial  Account shall be released to Seller upon the Settlement Date of the related Security (unless  there is a Securities Issuance Failure) only if, and to the extent that, the amounts due and  payable to Purchaser hereunder have been set-off against the Purchase Price for the Related  Participation Certificate or the Completion Fee. The amounts paid to Seller (if any)  pursuant to this Section 6(d)(i) shall constitute Seller’s sole compensation for subservicing  the Related Mortgage Loans as provided in this Section 6.  (ii) If Successor Servicer takes delivery of such Mortgage Loans either  under the circumstances set forth in Section 6(f) or otherwise, all amounts deposited in the  Custodial Account shall be paid to Purchaser promptly upon such delivery.  (iii) If a Security is not issued solely as a result of a Security Issuance  Failure during the month in which the related Settlement Date occurs, in any period  thereafter during which Seller remains as subservicer, all amounts deposited in the  Custodial Account shall be released only in accordance with the Agent’s written  instructions.  (e) Purchaser (or any other registered holder of the Related Participation  Certificate) shall be entitled to effect termination of Seller’s subservicing rights and obligations  respecting the affected Related Mortgage Loans in the event any of the following circumstances  or events (“Servicing Termination Events”) occur and are continuing:  (i) any failure by Seller to remit to Purchaser (or other registered holder  of the Participation Certificate) when due any payment required to be made under the terms  of this Agreement or such Participation Certificate and such failure is not cured within  three (3) Business Days of the earlier of (x) Seller’s receipt of written notice from Purchaser  of such breach or (y) the date on which Seller obtains notice or knowledge of the facts  giving rise to such breach; or  (ii) failure by Seller duly to observe, perform or comply with any  material term, condition, covenant or agreement set forth in this Agreement or in the  

 

- 34 -    Custodial Agreement which continues unremedied for a period of five (5) Business Days  of the earlier of (x) Seller’s receipt of written notice from Purchaser, Agent or Custodian  of such breach or (y) the date on which Seller obtains notice or knowledge of the facts  giving rise to such breach; or  (iii) any representation or warranty made by Seller (or any of Seller’s  officers) in the Program Documents, including, but not limited to, all documents related to  this Agreement, shall have been incorrect or untrue in any material respect when made or  repeated or deemed by the terms thereof to have been incorrect or untrue in any material  respect when made or repeated (other than the representations or warranties in Section 9(b) and 9(c) related to the representations and warranties in Exhibit B of the Master Repurchase  Agreement); or  (iv) an Event of Insolvency with respect to Seller or any of its Affiliates;  or  (v) Seller ceases to meet the qualifications to maintain all requisite  Approvals, such Approvals are revoked or such Approvals are materially modified; or  (vi) [Reserved]; or  (vii) Seller fails to operate or conduct its business operations or any  material portion thereof in the ordinary course; or  (viii) Seller ceases to be a member of MERS in good standing and has not  been reinstated within fifteen (15) calendar days following receipt of notice or knowledge  thereof; or  (ix) an Event of Default (as defined in the Other Agreement) shall have  occurred and be continuing beyond any applicable cure period under any Other Agreement  to which Seller or any of its Affiliates or Subsidiaries is a party; or   (x) [Reserved]; or  (xi) in the event of a Security Issuance Failure, which continues  unremedied for a period of two (2) Business Days; or  (xii) a Change in Control of Seller shall have occurred that has not been  approved by Agent.  (f) Purchaser, in its sole discretion, may terminate Seller’s rights and  obligations as subservicer of the affected Related Mortgage Loans and require Seller to deliver the  related Servicing Records to Purchaser or its designee upon the occurrence of (i) a Servicing  Termination Event or (ii) Seller’s failure to comply with any of its obligations set forth in Section  5(c) or (d), by delivering written notice to Seller requiring such termination. Such termination shall  be effective upon Seller’s receipt of such written notice; provided, that Seller’s subservicing rights  shall be terminated immediately upon the occurrence of any event described in Section 6(e)(iv),  regardless of whether notice of such event shall have been given to or by Purchaser or Seller. Upon  

 

- 35 -    any such termination, all authority and power of Seller respecting its rights to subservice and duties  under this Agreement relating thereto, shall pass to and be vested in the Successor Servicer  appointed by Purchaser and Purchaser is hereby authorized and empowered to transfer such rights  to subservice the Related Mortgage Loans for such price and on such terms and conditions as  Purchaser shall reasonably determine; provided, that to the extent the Applicable Agency proceeds  to issue a Security with respect to the Related Mortgage Loans, Purchaser shall convey the  servicing rights and the rights to subservice such Related Mortgage Loans in accordance with such  Applicable Agency’s instructions. Seller shall promptly take such actions and furnish to Purchaser  such documents that Purchaser deems necessary or appropriate to enable Purchaser to obtain a  Security backed by such Related Mortgage Loans or to enforce such Related Mortgage Loans, as  appropriate, and shall perform all acts and take all actions so that the Related Mortgage Loans and  all files and documents relating to such Related Mortgage Loans held by Seller, together with all  escrow amounts relating to such Related Mortgage Loans, are delivered to Successor Servicer,  including but not limited to preparing, executing and delivering to the Successor Servicer any and  all documents and other instruments, placing in the Successor Servicer’s possession all Servicing  Records pertaining to such Related Mortgage Loans and doing or causing to be done, all at Seller’s  sole expense. To the extent that the approval of the Applicable Agency is required for any such  sale or transfer, Seller shall fully cooperate with Purchaser to obtain such approval. All amounts  paid by any purchaser of such rights to service or subservice the Related Mortgage Loans shall be  the property of Purchaser. The subservicing rights required to be delivered to Successor Servicer  in accordance with this Section 6(f) shall be delivered free of any servicing rights in favor of Seller  or any third party (other than Purchaser) and free of any title, interest, lien, encumbrance or claim  of any kind of Seller other than record title to the Mortgages relating to the Related Mortgage  Loans. No exercise by Purchaser of its rights under this Section 6(f) shall relieve Seller of  responsibility or liability for any breach of this Agreement.  (g) With respect to the Servicing Files and the physical and contractual  servicing of each Mortgage Loan to the extent in the possession of Seller, Seller shall deliver such  Servicing Files and the physical and contractual servicing to Purchaser or its designee upon the  expiration of the Servicing Term (unless such Servicing Term is renewed by Purchaser) or the  termination of the Seller as subservicer pursuant to this Section 6. Seller’s transfer of the servicing  rights, Servicing Files and the physical and contractual servicing under this Section 6(g) shall be  in accordance with customary standards in the industry including the transfer of the gross amount  of all escrows held for the related Mortgagors (without reduction for unreimbursed advances or  “negative escrows”).  (h) The Agent, in its sole discretion, may appoint a backup servicer at any time  during the term of this Agreement. In such event, Seller shall commence monthly delivery to such  backup servicer of the servicing information required to be delivered to Purchaser pursuant to  Section 6(b)(ii) and any other information reasonably requested by backup servicer, all in a format  that is reasonably acceptable to such backup servicer. Solely in the event that such backup servicer  is appointed by Agent as a result of the occurrence and continuation of an Event of Default, Seller  shall pay all costs and expenses of such backup servicer, including, but not limited to all fees of  such backup servicer in connection with the processing of such information and the maintenance  of a servicing file with respect to the Related Mortgage Loans. Seller shall cooperate fully with  such backup servicer in the event of a transfer of servicing hereunder and will provide such backup  

 

- 36 -    servicer with all documents and information necessary for such backup servicer to assume the  servicing of the Related Mortgage Loans.  Section 7. Transfers of Participation Certificates and Securities by Purchaser¶.  Purchaser may, in its sole discretion and without the consent of Seller, sell, assign or otherwise  transfer all of its right, title and interest or grant a security interest in any Participation Certificate,  any Mortgage Note, Mortgage and Assignment of Mortgage related to such Participation  Certificate and the related servicing rights, each Security in respect thereof of which Delivery is  made to Purchaser and all rights of Purchaser under this Agreement (including, but not limited to,  the Custodial Account) in respect of such Participation Certificate, any such Mortgage Note,  Mortgage, Assignment of Mortgage and such Security, to any person (an “Assignee”), all at no  cost to Seller, subject only to an obligation on the part of the Assignee to deliver each such Security  to the Takeout Investor or to Purchaser to permit Purchaser or its designee to make delivery thereof  to the Takeout Investor. In the event Purchaser engages in an assignment of a Participation Certificate  and the related servicing rights as provided in this Section 7, (i) the Purchaser’s obligations under this  Agreement shall remain unchanged, (ii) the Purchaser shall remain solely responsible to the other parties  hereto for the performance of such obligations, and (iii) Seller shall continue to deal solely and directly  with Purchaser in connection with Purchaser’s rights and obligations under this Agreement.  Without limitation of the foregoing, an assignment of a Participation Certificate  and the related servicing rights to an Assignee, as described in this Section 7, shall be effective  upon delivery of the Participation Certificate to the Assignee or its designee, together with a duly  executed Assignment substantially in the form of Exhibit E (with a copy to Seller).  Section 8. Record Title to Mortgage Loans; Intent of Parties; Security Interest.  (a) From and after the issuance and delivery of the Related Participation  Certificate, and subject to the remedies of Purchaser in Section 5, Seller (or its designated  subservicer) as subservicer shall remain the last named payee or endorsee of each Mortgage Note  related to a Related Mortgage Loan and the mortgagee or assignee of record of each Mortgage  related to a Related Mortgage Loan (except with respect to any MERS Designated Mortgage Loan)  and shall retain only record title to the Mortgages (and not an equitable interest) in the Related  Mortgage Loan, all for the benefit of Purchaser for the sole purpose of facilitating the subservicing  of such Related Mortgage Loan and the issuance of a Security backed by such Related Mortgage  Loan. Where Seller has appointed Freddie Mac as Custodian, the parties hereto acknowledge that  the Mortgage Notes related to a Participation Certificate acquired hereunder have been deposited  with Freddie Mac to facilitate the issuance of Freddie Mac Securities with respect thereto and that  prior to such issuance Freddie Mac is holding such Mortgage Notes as Custodian for Purchaser.  (b) Seller shall maintain a complete set of books and records for each Related  Mortgage Loan which shall be clearly marked to reflect the beneficial ownership interest in each  Related Mortgage Loan of the holder of the Related Participation Certificate. Seller shall notify  MERS of the beneficial ownership interest of Purchaser in each MERS Designated Mortgage Loan  through the MORNET system or any other comparable system acceptable to MERS.  (c) Purchaser and Seller confirm that the transactions contemplated herein are  intended to be sales of the Participation Certificates by Seller to Purchaser rather than borrowings  

 

- 37 -    secured by the Participation Certificates. In the event, for any reason, any transaction is construed  by any court or regulatory authority as a borrowing rather than as a sale, Seller and Purchaser  intend that Purchaser or its Assignee, as the case may be, shall have a perfected first priority  security interest in the Participation Certificates, and all of Seller’s interest in all of the servicing  rights with respect to the Related Mortgage Loans, the Custodial Account and all amounts on  deposit therein, the Related Mortgage Loans subject to each Participation Certificate, all  documents, records (including Servicing Records), instruments and data evidencing the Related  Mortgage Loans and the servicing thereof, the Securities to be issued as contemplated hereunder,  all principal and interest collected thereon and all proceeds thereof, the Takeout Commitments and  the proceeds of any and all of the foregoing (collectively, the “Collateral”), free and clear of  adverse claims. In furtherance thereof, Seller hereby grants to Purchaser (as defined in the  introductory paragraph of this Agreement) a first priority security interest in and lien upon the  Collateral, free and clear of adverse claims. In such event, this Agreement shall constitute a  security agreement, the Custodian shall be deemed to be an independent custodian for purposes of  perfection of the security interest herein granted to Purchaser, and Purchaser or each such Assignee  shall have all of the rights of a secured party under applicable law.  Upon request of Purchaser, Seller shall prepare and deliver to MERS an  Assignment of Mortgage from MERS to Purchaser or its designee. Upon due execution by MERS,  Seller shall cause such Assignment of Mortgage to be recorded in the public land records upon  request of Purchaser.  Section 9. Representations and Warranties.  (a) Seller hereby represents and warrants to Purchaser and Agent as of the date  hereof and with respect to the Related Mortgage Loans as of the date of each issuance and delivery  of a Participation Certificate that:  (i) Seller will not be rendered insolvent by any transaction  contemplated by this Agreement and, after giving effect to each such transaction, Seller  will not be left with an unreasonably small amount of capital with which to engage in its  business. Seller does not intend to incur, nor believes that it has incurred, debts beyond its  ability to pay such debts as they mature. Seller is not contemplating the commencement of  insolvency, bankruptcy, liquidation or consolidation proceedings or the appointment of a  receiver, liquidator, conservator, trustee or similar official in respect of Seller or any of its  assets;  (ii) The consideration received by Seller upon the sale of each  Participation Certificate, taken as a whole, will constitute reasonably equivalent value and  fair consideration for the beneficial ownership interest in the Mortgage Loans evidenced  by that Participation Certificate; (iii) Seller is duly organized, validly existing and in good standing under  the laws of the jurisdiction of its organization, and it has qualified to do business in each  jurisdiction in which it is legally required to do so. Seller has the power and authority under  its certificate of formation, operating agreement and applicable law to enter into this  Agreement and the Custodial Agreement and to perform all acts contemplated hereby and  

 

- 38 -    thereby or in connection herewith and therewith; this Agreement, the Custodial Agreement,  the Pricing Side Letter, the Custodial Account Control Agreement and the transactions  contemplated hereby and thereby have been duly authorized by all necessary action and do  not require any additional approvals or consents or other action by, or any notice to or filing  with, any Person other than any that have heretofore been obtained, given or made; (iv) The consummation of the transactions contemplated by this  Agreement and the Program Documents are in the ordinary course of business of Seller  and will not conflict with, result in the breach of or violate any provision of the certificate  of formation or operating agreement of Seller or result in the breach of any provision of,  or conflict with or constitute a default under or result in the acceleration of any obligation  under, any material agreement, indenture, loan or credit agreement or other instrument to  which Seller, the Related Mortgage Loans or any of Seller’s Property is or may be subject  to, or result in the violation of any law, rule, regulation, order, judgment or decree to which  Seller, the Related Mortgage Loans or Seller’s Property is or may be subject. Without  limiting the generality of the foregoing, the consummation of the transactions contemplated  herein or therein will not violate any policy, regulation or guideline of the FHA or VA or  result in the voiding or reduction of the FHA insurance, VA guarantee or any other  insurance or guarantee in respect of any Mortgage Loan, or otherwise render such  Mortgage Loans, individually or in the aggregate, ineligible (pursuant to the applicable  Agency Guide or otherwise) for inclusion in a pool of mortgages supporting a Security,  and such FHA insurance or VA guarantee is in full force and effect or shall be in full force  and effect as required by the applicable Agency Guide;  (v) No practice, procedure or policy employed by Seller in the conduct  of its businesses violates any law, regulation, judgment, agreement, regulatory consent,  order or decree applicable to it which, if enforced, would result in a Material Adverse  Effect; (vi) This Agreement, the Custodial Agreement and every other Program  Document to be executed by Seller is the legal, valid, binding and subsisting obligations  of Seller, enforceable in accordance with their respective terms, except that (A) the  enforceability thereof may be limited by bankruptcy, insolvency, moratorium, receivership  and other similar laws relating to creditors’ rights generally and (B) the remedy of specific  performance and injunctive and other forms of equitable relief may be subject to equitable  defenses and to the discretion of the court before which any proceeding therefor may be  brought;  (vii) No consent, license, approval or authorization from, or registration,  filing or declaration with, any regulatory body, administrative agency or other  governmental instrumentality, nor any consent, approval, waiver or notification of any  creditor, lessor or other non-governmental Person, is required in connection with the  execution, delivery and performance by Seller of this Agreement or any other Program  Document to which it is a party, other than any that have heretofore been obtained, given  or made;  

 

- 39 -    (viii) Seller has not sold, assigned, transferred, pledged or hypothecated  any interest in any Participation Certificate or Related Mortgage Loan to any person other  than any sale, assignment, transfer, pledge or hypothecation that is released in conjunction  with the sale to Purchaser pursuant to the Master Repurchase Agreement or hereunder, and  upon delivery of a Participation Certificate to Purchaser, Purchaser will be the sole owner  thereof, free and clear of any lien, claim or encumbrance other than those arising under this  Agreement; (ix) Neither this Agreement nor any representations and warranties or  information relating to Seller that Seller has delivered or caused to be delivered to  Purchaser, including, but not limited to, all documents related to this Agreement, the  Custodial Agreement or Seller’s financial statements, contains any untrue statement of a  material fact or when taken as a whole omits to state a material fact necessary to make the  statements made therein or herein in light of the circumstances under which they were  made, not misleading. Since the furnishing of such documents or information, to Seller’s  knowledge, there has been no change, nor any development or event involving a  prospective change that would render any of such documents or information untrue or  misleading in any material respect, unless Seller delivered such other documents or  information informing Purchaser or Agent of such change;  (x) Except as disclosed to the Agent, no action, suit, proceeding or  investigation, at law or in equity, or before or by any court, public board or body pending  or, to Seller’s knowledge, threatened against or affecting Seller (or, to Seller’s knowledge,  any basis therefor) wherein an unfavorable decision, ruling or finding would adversely  affect the validity or enforceability of this Agreement, the Custodial Agreement or could  adversely affect Seller’s ability to carry out its obligations hereunder;  (xi) Seller has all requisite Approvals;  (xii) The Custodian is not an Affiliate of Seller;  (xiii) The Bank is not an Affiliate of Seller;  (xiv) The Agreement and the other Program Documents, any other  document contemplated hereby or thereby and each transaction have not been entered into  fraudulently by Seller hereunder, or with the intent to hinder, delay or defraud any creditor  or Purchaser; and  (xv) [Reserved];  (xvi) [Reserved];  (xvii) [Reserved; (xviii) As of the date of this Agreement, Seller is an approved FHA, VA,  RD, Ginnie Mae, Fannie Mae and/or Freddie Mac seller, mortgagee and/or servicer and is  in good standing with these agencies.   

 

- 40 -    (xix) For so long as such Unsecured Term Loan is outstanding, Seller is  not in breach of any representation, warranty, covenant, or other provision of the  Unsecured Term Loan related to the delinquency of Ginnie Mae mortgage loans.  (b) Seller hereby represents and warrants to Purchaser and Agent with respect  to each Related Mortgage Loan, as of the Purchase Date for the Related Participation Certificate  that each of the representations and warranties set forth on Exhibit B to the Master Repurchase  Agreement is true and accurate.  The representations and warranties of Seller in this Section 9 are unaffected by and  supersede any provision in any endorsement of any Related Mortgage Loan or in any assignment  with respect to such Mortgage Loan to the effect that such endorsement or assignment is without  recourse or without representation or warranty.  Section 10. Covenants of Seller¶. Seller hereby covenants and agrees with Purchaser and  Agent as of the date hereof and for so long as any Participation Certificate remains outstanding as  follows: (a) Seller shall keep or cause to be kept in reasonable detail books and records  setting forth an account of its assets and business and, as applicable, shall clearly reflect therein  the transfer of Seller’s beneficial right, title and interest in and to the Related Mortgage Loans.  (b) Seller shall deliver to Purchaser and Agent:  (i) Within ninety (90) days after the end of each fiscal year of Seller,  the consolidated audited balance sheets of Seller and its consolidated Subsidiaries, which  will be in conformity with GAAP, and the related consolidated audited statements of  income and changes in equity showing the financial condition of Seller and its consolidated  Subsidiaries as of the close of such fiscal year and the results of operations during such  year, and consolidated audited statements of cash flows, as of the close of such fiscal year,  setting forth, in each case, in comparative form the corresponding figures for the preceding  year.  The foregoing consolidated financial statements are to be reported on by, and to carry  the unqualified report (in a form substantially similar to the form of financial statements  attached to the Master Repurchase Agreement as Exhibit J, or in a form otherwise  acceptable to Purchaser and Agent) of, an independent public accountant of national  standing acceptable to Purchaser and Agent, which shall include KPMG LLP,  PricewaterhouseCoopers LLP, Deloitte LLP, BDO USA, LLP, Ernst & Young, and any  other similarly situated independent public account;  (ii) Within forty-five (45) days after the end of each of the first three  fiscal quarters of each fiscal year of Seller, consolidated unaudited balance sheets and  consolidated statements of income and changes in equity, (in a form substantially similar  to the form of financial statements attached to the Master Repurchase Agreement as Exhibit  K, or in a form otherwise acceptable to Purchaser and Agent), showing the financial  condition and results of operations of Seller and its consolidated Subsidiaries, each on a  consolidated basis as of the end of each such quarter and for the then elapsed portion of the  fiscal year, setting forth, in each case, in comparative form the corresponding figures for  

 

- 41 -    the corresponding periods of the preceding fiscal year, certified by a financial officer of  Seller who is qualified to make such certification as presenting fairly the financial position  and results of operations of Seller and its consolidated Subsidiaries and as having been  prepared in accordance with GAAP consistently applied, in each case, subject to normal  year-end audit adjustments;  (iii) As soon as is practicable, but in any event within thirty (30) days  after the end of each of the first two months of a fiscal quarter, consolidated unaudited  balance sheets and consolidated statements of income and changes in equity (in a form  substantially similar to the form of financial statements attached to the Master Repurchase  Agreement as Exhibit K, or in a form otherwise acceptable to Purchaser and Agent)  showing the financial condition and results of operations of Seller and its consolidated  Subsidiaries on a consolidated basis as of the end of each such month and for the then  elapsed portion of the fiscal year, setting forth, in each case, in comparative form the  corresponding figures for the corresponding month of the preceding fiscal year, certified  by a financial officer of Seller who is qualified to make such certification as presenting  fairly the financial position and results of operations of Seller and its consolidated  Subsidiaries and as having been prepared in accordance with GAAP consistently applied,  in each case, subject to normal year-end audit adjustments;  (iv) [Reserved];  (v) Promptly upon any Responsible Officer becoming aware of the  commencement of, or any determination in, any material dispute, litigation, investigation,  proceeding, sanctions or suspension between Seller, on the one hand, and any  Governmental Authority or any other Person, on the other (other than any investigation or  proceeding conducted in the ordinary course of business by a state licensing authority) that  is reasonably likely to have a Material Adverse Effect;  (vi) Promptly upon becoming available, copies of all financial  statements, reports, notices and proxy statements sent by its Parent Company, Seller or any  of Seller’s consolidated Subsidiaries in a general mailing to their respective stockholders  and of all reports and other material (including copies of all registration statements under  the Securities Act of 1933, as amended) filed by any of them with any securities exchange  or with the SEC or any governmental authority succeeding to any or all of the functions of  the SEC;  (vii) [Reserved];  (viii) Such supplements to the aforementioned documents and such other  information regarding the operations, business, affairs and financial condition of its Parent  Company, Seller or any of Seller’s consolidated Subsidiaries as Purchaser or Agent may  reasonably request;  (ix) [Reserved];   (x) [Reserved];  

 

- 42 -    (xi) To the extent not otherwise prohibited from disclosing, promptly  upon a Responsible Officer becoming aware thereof, any penalties, sanctions or charges  levied, or reasonably threatened in writing to be levied, against Seller or any change, or  change threatened in writing, in Approval status against Seller by any Applicable Agency,  or any supervisory or regulatory Governmental Authority (including, but not limited to  HUD, FHA and VA) supervising or regulating the origination or servicing of mortgage  loans by, or the issuer status of, Seller (which, in the event of a Governmental Authority,  could reasonably be expected to have a Material Adverse Effect).  Seller’s obligation to deliver any report or other document under this Section 10(b) shall be deemed to have been satisfied if, and as of the date, such report or other document  is filed with the SEC pursuant to the SEC’s Electronic Data Gathering & Analysis  Recovery system. (c) Neither Seller nor any Affiliate thereof will acquire at any time any  Participation Certificate or any other economic interest in or obligation with respect to any Related  Mortgage Loan except for the subservicing rights relating thereto and record title to the Mortgage  relating to any Related Mortgage Loan.  (d) Seller shall take all commercially reasonable actions necessary or, in the  reasonable opinion of Purchaser, desirable, to preserve the Related Mortgage Loans and other  Collateral so that they remain subject to a first priority perfected security interest hereunder and  deliver evidence that such actions have been taken, including, without limitation, duly completed  and filed Uniform Commercial Code financing statements on Form UCC1.  (e) Seller will not be rendered insolvent by, any sale of a Participation  Certificate to Purchaser.  (f) Seller will not sell any Participation Certificate to Purchaser with any intent  to hinder, delay or defraud any of Seller’s creditors.  (g) Seller shall take all reasonably necessary actions to maintain its Approvals  at all times during the term of this Agreement. If, for any reason, Seller ceases to maintain any  such Approval, Seller shall so notify Purchaser and Agent within two (2) Business Days.  (h) Seller shall (i) maintain all licenses, permits or other approvals necessary  for Seller to conduct its business and to perform its obligations under the Program Documents, (ii)  remain in good standing to the extent required under, and comply in all material respects with, all  laws of each state in which it conducts business or any Mortgaged Property is located, and (iii)  conduct its business strictly in accordance with applicable law.  (i) Seller shall, upon request of Purchaser or Agent, promptly execute and  deliver to Purchaser all such other and further documents and instruments of transfer, conveyance  and assignment, and shall take such other action as Purchaser or Agent may require to more  effectively transfer, convey, assign to and vest in Purchaser and to put Purchaser in possession of  the property to be transferred, conveyed, assigned and delivered hereunder and otherwise to carry  out more effectively the intent of the provisions under this Agreement.  

 

- 43 -    (j) The Seller is a member of MERS in good standing and current in the  payment of all fees and assessments imposed by MERS, and has complied with all rules and  procedures of MERS.  In connection with the assignment of any Related Mortgage Loan registered  on the MERS System, the Seller agrees that it will, at the Seller’s own cost and expense, promptly  cause the MERS System to indicate that such Mortgage Loan has been transferred to the Purchaser  in accordance with the terms of the Master Repurchase Agreement by including in MERS’  computer files (a) the code in the field which identifies the specific owner of the Mortgage Loans  and (b) the code in the field “Pool Field” which identifies the series in which such Mortgage Loans  were sold.  The Seller further agrees that it will not alter codes referenced in this paragraph with respect to any Mortgage Loan at any time that such Mortgage Loan is subject to the Master  Repurchase Agreement, and the Seller shall retain its membership in MERS at all times during the  term of this Agreement.  For eMortgage Loans, Seller shall comply in all material respects with  all rules and procedures in connection with the maintenance of the related eNotes on the MERS  eRegistry for so long as such Related Mortgage Loans are so registered.  (k) Seller will permit Purchaser, Agent or their respective agents or designees  to perform due diligence reviews on the Related Mortgage Loans subject to each Participation  Certificate purchased hereunder up to the Due Diligence Review Amount within the thirty (30)  days following the related Purchase Date. Seller shall cooperate in all respects with such diligence  and shall provide Purchaser, Agent or their respective agents or designees who are bound by  confidentiality requirements with all loan files and other information (including, without  limitation, Seller’s quality control procedures and results) reasonably requested by Purchaser,  Agent or their respective agents or designees and shall bear all costs and expenses associated with  such due diligence.  (l) Except as permitted herein or in the Master Repurchase Agreement, Seller  shall not sell, assign, transfer or otherwise dispose of, or grant any option with respect to, or pledge,  hypothecate or grant a security interest in, or Lien on or otherwise encumber (except pursuant to  the Program Documents) any of the Related Mortgage Loans or any interest therein, provided that  this Section 10(l) shall not prevent any of the following: any contribution, sale, assignment,  transfer or conveyance of Related Mortgage Loans in accordance with the Program Documents  and any forward purchase commitment or other type of take out commitment for the Related  Mortgage Loans (without vesting rights in the related purchasers as against Purchaser).  (m) Seller shall comply with the financial covenants set forth in Section 15(g)(ii)  of the Master Repurchase Agreement and Section 4 of the Pricing Side Letter.  (n) Seller shall (i) at all times maintain copies of relevant portions of all final  written Applicable Agency audits, examinations, evaluations, monitoring reviews and reports of  its origination and servicing operations (including those prepared on a contract basis for any such  agency) in which there are material adverse findings, including without limitation notices of  defaults, notices of termination of approved status, notices of imposition of supervisory  agreements or interim servicing agreements, and notices of probation, suspension, or non-renewal,  and all necessary approvals from each  Applicable Agency. Seller shall (x) disclose to Agent  any  portion of such information that is not confidential, (y) notify Agent of any material event in a  level of specificity that would not violate the confidentiality requirements and (z) promptly seek  

 

- 44 -    permission to disclose the information from the necessary parties and shall provide Agent such  information to the extent of such permission.  (o) [Reserved].  (p) Seller shall timely pay to Purchaser all reasonable fees and documented out  of pocket expenses required to be paid by Seller hereunder and under any other Program Document  to Purchaser in immediately available funds, and without deduction, set-off or counterclaim in  accordance with Purchaser’s Wire Instructions.  Section 11. Term¶. This Agreement shall continue in effect until terminated as to future  transactions on the Termination Date; provided, that no termination will affect the obligations  hereunder as to any of the Participation Certificates then outstanding hereunder or any Security  not yet delivered to the related Takeout Investor. Seller’s obligations to indemnify Purchaser and  Agent pursuant to this Agreement and the other Program Documents shall survive the termination  hereof.  Section 12. Set-Off¶. In addition to any rights and remedies of Purchaser hereunder and  at law, upon the occurrence and continuation of a default hereunder or under any of the Program  Documents, Purchaser and its Affiliates shall have the right, without prior notice to Seller, any  such notice being expressly waived by Seller to the extent permitted by applicable law, upon any  amount becoming due and payable (whether at the stated maturity, by acceleration or otherwise)  by Seller hereunder, under the Mortgage Loan Participation Purchase and Sale Agreement or under  any other warehouse, repurchase, or mortgage servicing rights facility or related trade line entered  into between Seller, on the one hand, and Purchaser or any of its Affiliates, on the other hand, to  set-off and appropriate and apply against such amount any and all Property and deposits (general  or special, time or demand, provisional or final), in any currency, or any other credits, indebtedness  or claims, in any currency, or any other collateral (in the case of collateral not in the form of cash  or such other marketable or negotiable form, by selling such collateral in a recognized market  therefor or as otherwise permitted by law or as may be in accordance with custom, usage or trade  practice), in each case, whether direct or indirect, absolute or contingent, matured or unmatured,  at any time held or owing by Purchaser or any Affiliate thereof to or for the credit or the account  of Seller except and to the extent that any of the same are held by Seller for the account of another  Person.  Upon the occurrence of a default hereunder or under any of the Program Documents, Purchaser may also set-off cash and all other sums or obligations owed by Purchaser or its  Affiliates to Seller or its Affiliates (whether under this Agreement, under the Mortgage Loan  Participation Purchase and Sale Agreement or under any other warehouse, repurchase, or mortgage  servicing rights facility or related trade line entered into between Seller, on the one hand, and  Purchaser or any of its Affiliates, on the other hand) against all of Seller’s obligations to Purchaser  or its Affiliates (whether under this Agreement, under the Mortgage Loan Participation Purchase  and Sale Agreement or under any other warehouse, repurchase, or mortgage servicing rights  facility or related trade line entered into between Seller, on the one hand, and Purchaser or any of  its Affiliates, on the other hand), whether or not such obligations are then due. The exercise of any  such right of set-off shall be without prejudice to Purchaser’s or its Affiliate’s right to recover any  deficiency.  Purchaser agrees to promptly notify Seller after any such set-off and application made  by Purchaser; provided that the failure to give such notice shall not affect the validity of such  set-off and application.  

 

- 45 -    Section 13. Indemnification¶. Seller shall indemnify and hold Purchaser and Agent  harmless against any and all Losses (including, without limitation, Losses incurred by Purchaser  on account of fees paid by Purchaser to the Applicable Agency to cause the Securities to be issued  or any Losses in connection with any indemnification by Purchaser of the Applicable Agency)  resulting from, relating to or otherwise arising in connection with the breach by Seller of any  representation, warranty or covenant in this Agreement (including, without limitation, any failure  to perform servicing obligations). Without prejudice to the survival of any other agreement of  Seller hereunder, the covenants and obligations of Seller contained in this Section 13 shall survive  the termination of this Agreement. Section 14. Exclusive Benefit of Parties; Assignment¶. This Agreement is for the  exclusive benefit of the parties hereto and their respective successors and assigns and shall not be  deemed to give any legal or equitable right to any other person, including any Takeout Investor or  the Custodian. In addition to the rights of Purchaser as provided in Section 7, subject to the consent  of the Seller (such consent not to be unreasonably withheld) and at no cost or expense to the Seller,  each of Purchaser and Agent may, in its sole election, assign or participate all or a portion of its  rights and obligations under this Agreement and the Program Documents with a counterparty of  Purchaser’s or Agent’s choice. Purchaser or Agent shall notify Seller of any such assignment and  participation and shall maintain, for review by Seller upon written request, a register of assignees  and participants and a copy of any executed assignment and acceptance by Purchaser or Agent and  assignee (“Assignment and Acceptance”), specifying the percentage or portion of such rights and  obligations assigned. The Seller agrees that, for any such permitted assignment, Seller will  cooperate with the prompt execution and delivery of documents reasonably necessary for such  assignment process to the extent that Seller incurs no cost or expense that is not paid by the  Purchaser or Agent, as applicable. Upon such assignment, (a) such assignee shall be a party hereto  and to each Program Document to the extent of the percentage or portion set forth in the  Assignment and Acceptance, and shall succeed to the applicable rights and obligations of  Purchaser or Agent hereunder, and (b) Purchaser or Agent shall, to the extent that such rights and  obligations have been so assigned by it to either (i) an Affiliate of Purchaser or Agent which  assumes the obligations of Purchaser or Agent hereunder or (ii) to another Person which assumes  the obligations of Purchaser or Agent hereunder, be released from their obligations hereunder  accruing thereafter and under the Program Documents.  Purchaser and Agent may distribute to any prospective assignee, participant or  pledgee any document or other information delivered to Purchaser by Seller subject to the  confidentiality restrictions contained in Section 27 hereof; accordingly, such prospective assignee,  participant or pledgee shall be required to agree to confidentiality provisions similar to those set  forth in Section 27.  The Program Documents and the Seller’s rights and obligations thereunder are not  assignable by Seller without the prior written consent of Purchaser and Agent. Any Person into  which Seller may be merged or consolidated, or any corporation resulting from any merger,  conversion or consolidation to which Seller shall be a party, or any Person succeeding to the  business of Seller, shall be the successor of Seller hereunder, without the execution or filing of any  paper or any further act on the part of any of the parties hereto, anything herein to the contrary  notwithstanding.  

 

- 46 -    Section 15. Amendments; Waivers; Cumulative Rights¶. No amendment or waiver of  any provision of this Agreement nor any consent to any failure to comply herewith or therewith  shall in any event be effective unless the same shall be in writing and signed by Seller, Purchaser  and Agent, and then such amendment, waiver or consent shall be effective only in the specific  instance and for the specific purpose for which given.  Section 16. Execution in Counterparts¶. This Agreement may be executed in any number  of counterparts, all of which shall constitute one and the same instrument, and any party hereto  may execute this Agreement by signing and delivering one or more counterparts.  The parties  intend that faxed signatures and electronically imaged signatures such as .pdf files shall constitute  original signatures and are binding on all parties.  The original documents shall be promptly  delivered, if requested. The parties agree that this Agreement, any addendum, exhibit or  amendment hereto or any other document necessary for the consummation of the transactions  contemplated by this Agreement may be accepted, executed or agreed to through the use of an  electronic signature in accordance with E-Sign, UETA and any applicable state law.  Any  document accepted, executed or agreed to in conformity with such laws will be binding on all  parties hereto to the same extent as if it were physically executed and each party hereby consents  to the use of any secure third party electronic signature capture service with appropriate document  access tracking, electronic signature tracking and document retention as may be reasonably chosen  by a signatory hereto, including but not limited to DocuSign.  Section 17. Effect of Invalidity of Provisions¶. In case any one or more of the provisions  contained in this Agreement should be or become invalid, illegal or unenforceable in any respect,  the validity, legality and enforceability of the remaining provisions contained herein or therein  shall in no way be affected, prejudiced or disturbed thereby.  Section 18. Governing Law; Waiver of Jury Trial; Consent to Jurisdiction and Venue;  Service of Process¶. This Agreement shall be binding and inure to the benefit of the parties hereto  and their respective successors and assigns.  THIS AGREEMENT SHALL BE CONSTRUED IN  ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE STATE OF NEW  YORK, WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES  THEREOF (EXCEPT FOR SECTION 5-1401 AND SECTION 5-1402 OF THE NEW YORK  GENERAL OBLIGATIONS LAW).   EACH OF SELLER, PURCHASER AND AGENT HEREBY IRREVOCABLY  WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND  ALL RIGHTS TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR  RELATING TO THIS AGREEMENT, THE PROGRAM DOCUMENTS OR ANY OF THE  TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH OF SELLER,  PURCHASER AND AGENT HEREBY IRREVOCABLY AND UNCONDITIONALLY  CONSENTS, ON BEHALF OF ITSELF AND ITS PROPERTY, TO THE NON-EXCLUSIVE  JURISDICTION OF ANY COURT OF THE STATE OF NEW YORK, OR IN THE UNITED  STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, IN ANY  ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THE PROGRAM  DOCUMENTS IN ANY ACTION OR PROCEEDING.  EACH OF SELLER, PURCHASER  AND AGENT HEREBY SUBMITS TO, AND WAIVES ANY OBJECTION IT MAY HAVE  TO, NON-EXCLUSIVE PERSONAL JURISDICTION AND VENUE IN THE COURTS OF  

 

- 47 -    THE STATE OF NEW YORK AND THE UNITED STATES DISTRICT COURT FOR THE  SOUTHERN DISTRICT OF NEW YORK, WITH RESPECT TO ANY DISPUTES ARISING  OUT OF OR RELATING TO THE PROGRAM DOCUMENTS.  EACH OF SELLER,  PURCHASER AND AGENT HEREBY IRREVOCABLY CONSENTS TO THE SERVICE OF  A SUMMONS AND COMPLAINT AND OTHER PROCESS IN ANY ACTION, CLAIM OR  PROCEEDING BROUGHT BY ANOTHER PARTY IN CONNECTION WITH THIS  AGREEMENT OR THE OTHER PROGRAM DOCUMENTS, ANY RIGHTS OR  OBLIGATIONS HEREUNDER OR THEREUNDER, OR THE PERFORMANCE OF SUCH  RIGHTS AND OBLIGATIONS, ON BEHALF OF ITSELF OR ITS PROPERTY, IN THE  MANNER SPECIFIED IN THIS SECTION 31 AND TO SUCH PARTY’S REGISTERED  AGENT OR SUCH OTHER ADDRESS AS SUCH PARTY SHALL HAVE PROVIDED IN  WRITING TO THE OTHER PARTIES HERETO.  NOTHING IN THIS SECTION 31 SHALL  AFFECT THE RIGHT OF ANY PARTY HERETO TO (I) SERVE LEGAL PROCESS IN ANY  OTHER MANNER PERMITTED BY APPLICABLE LAW, OR (II) BRING ANY ACTION OR  PROCEEDING AGAINST ANY OTHER PARTY OR ITS PROPERTIES IN THE COURTS OF  ANY OTHER JURISDICTIONS.  Section 19. Notices¶. Any notices, consents, elections, directions and other  communications given under this Agreement shall be in writing and shall be deemed to have been  duly given when telecopied or delivered by overnight courier to, personally delivered to, or on the  third day following the placing thereof in the mail, first class postage prepaid to, the parties hereto  at the related address set forth in Annex A or to such other address as either party shall give notice  to the other party pursuant to this Section. Notices to any Assignee shall be given to such address  as the Assignee shall provide to Seller in writing.  Section 20. Entire Agreement¶. This Agreement, the Participation Certificates, the  Custodial Agreement and the other Program Documents contain the entire agreement between the  parties hereto with respect to the subject matter hereof, and supersede all prior and  contemporaneous agreements between them, oral or written, of any nature whatsoever with respect  to the subject matter hereof.  Section 21. Costs of Enforcement¶. (a)  In addition to any other indemnity specified in  this Agreement, Seller agrees to pay as and when billed by Purchaser or Agent all of the reasonable  out-of-pocket costs and expenses incurred by Purchaser and Agent in connection with the  development, preparation, and execution of, and any amendment, supplement or modification to,  and enforcement of this Agreement, any other related document or any other documents prepared  in connection herewith or therewith.  (b) If Seller fails to pay when due any costs, expenses or other amounts payable  by it under this Agreement, including, without limitation, reasonable fees and expenses of counsel  and indemnities, such amount may be paid on behalf of Seller by Purchaser or Agent, in its sole  discretion and Seller shall remain liable for any such payments by Purchaser or Agent, as applicable. No such payment by Purchaser or Agent shall be deemed a waiver of any of Purchaser’s  or Agent’s respective rights under this Agreement. (c) In addition to any other indemnity specified in this Agreement, in the event  of a breach by Seller of this Agreement, the Custodial Agreement, a Participation Certificate or a  

 

- 48 -    Takeout Commitment, Seller agrees to pay the reasonable attorneys’ fees and expenses of  Purchaser, Agent and/or any Assignee incurred as a consequence of such breach.  Section 22. Securities Contract; Netting Agreement.   (a) Seller, Purchaser and Agent recognize that each sale of a Participation  Certificate (including the related servicing rights) under this Agreement is a “securities contract”  and a “master netting agreement” as those terms are defined in Section 741 and Section  101(38A)(A) of the Bankruptcy Code, respectively, and a “qualified financial contract” as that  term is defined in the FDIA. Seller and Purchaser further recognize that the beneficial interest in  the Related Mortgage Loans evidenced by a Participation Certificate shall constitute an “interest  in a mortgage loan” as that term is used in Section and 741(7)(A)(i) of Bankruptcy Code.  (b) It is understood that the Purchaser shall have the right to liquidate, terminate  and accelerate, or exercise any other remedies permitted upon the occurrence of any Servicing  Termination Event, and that such liquidation, termination and acceleration rights constitute  contractual rights to liquidate, terminate and accelerate the transactions under a “securities  contract” and a “master netting agreement” as described in Section 555 and Section 561 of the  Bankruptcy Code, respectively, and a “qualified financial contract” as described Section  1821(e)(8)(A)(i) of the FDIA.   (c) The parties hereto agree and acknowledge that if a party hereto is an  “insured depository institution,” as such term is defined in the FDIA, then each transaction  hereunder is a “qualified financial contract,” as that term is defined in the FDIA and any rules,  orders or policy statements thereunder (except insofar as the type of assets subject to such  transaction would render such definition inapplicable).  (d) It is understood that this Agreement constitutes a “netting contract” as  defined in and subject to Title IV of the Federal Deposit Insurance Corporation Improvement Act  of 1991 (“FDICIA”) and each payment entitlement and payment obligation hereunder shall  constitute a “covered contractual payment entitlement” or “covered contractual payment  obligation,” respectively, as defined in and subject to FDICIA.  Section 23. Consent to Service¶. Each party irrevocably consents to the service of  process by registered or certified mail, postage prepaid, to it at its address provided pursuant to  Section 19.  Section 24. Construction¶. The headings in this Agreement are for convenience only and  are not intended to influence its construction. References to Sections, Exhibits and Annexes in this  Agreement are to the Sections of and Exhibits and Annexes to this Agreement. The Exhibits and  Annexes are part of this Agreement. In this Agreement, the singular includes the plural, the plural  the singular, and the words “and” and “or” are used in the conjunctive or disjunctive as the sense  and circumstances may require. Section 25. Further Assurances¶. Seller, Purchaser and Agent each agree to execute and  deliver to the other such reasonable and appropriate additional documents, instruments or  agreements as may be necessary or appropriate to effectuate the purposes of this Agreement.  

 

- 49 -    Section 26. Due Diligence¶. Purchaser, Agent or any of their respective agents,  representatives or permitted assigns shall have the right, upon reasonable prior notice and during  normal business hours, subject to Section 10(k), no more than one time during any 12-month  period (unless a Servicer Termination Event has occurred and is continuing, in which case the  foregoing limitation of one examination during any 12-month period shall not be applicable), to  conduct on-site inspection and perform continuing on-site due diligence reviews of (x) Seller,  including, without limitation, for the purpose of verifying compliance with the representations,  warranties and covenants made under the Program Documents, (y) the Servicing File and (z) the  Related Mortgage Loans. Seller agrees promptly to provide Purchaser, Agent and their respective  agents with access to, copies of and extracts from any and all documents, records, agreements,  instruments or information (including, without limitation, any of the foregoing in computer data  banks and computer software systems) relating to Seller’s respective business, operations,  servicing, financial condition, performance of their obligations under the Program Documents, the  documents contained in the Servicing Files or the Related Mortgage Loans or assets proposed to  be sold hereunder in the possession, or under the control, of Seller. In addition, Seller shall also  make available to Purchaser and/or Agent, upon reasonable prior notice and during normal  business hours no more than one time during any 12-month period (unless a Servicer Termination  Event has occurred and is continuing, in which case the foregoing limitation of one examination  during any 12-month period shall not be applicable), a knowledgeable financial or accounting  officer of Seller for the purpose of answering questions respecting the Related Mortgage Loans.  Without limiting the generality of the foregoing, Seller acknowledges that Purchaser shall enter  into transactions with Seller based solely upon the information provided by Seller to Purchaser  and/or Agent and the representations, warranties and covenants contained herein, and that  Purchaser and/or Agent, at its option, shall have the right at any time to conduct itself or through  its agents, or require Seller to conduct quality reviews and underwriting compliance reviews of the  individual Related Mortgage Loans at the expense of Seller. Any such diligence conducted by  Purchaser and/or Agent shall not reduce or limit the Seller’s representations, warranties and  covenants set forth herein. Seller agrees to reimburse Purchaser and/or Agent for all reasonable  out-of-pocket due diligence costs and expenses incurred with one examination during any 12- month period (or in connection with any additional examinations conducted following the  occurrence and continuation of Servicer Termination Event) shall not be applicable) pursuant to  this Section 26.  Section 27. Confidentiality. Seller, Purchaser and Agent each hereby acknowledge and  agree that all written or computer-readable information provided by one party to the other in  connection with the Program Documents or the transactions contemplated thereby, including  without limitation, Seller’s Mortgagor information in the possession of Purchaser (the  “Confidential Terms”) shall be kept confidential and shall not be divulged to any party without the  prior written consent of such other party except for (i) disclosure to Seller’s direct and indirect  parent companies, directors, attorneys, auditors, taxing authorities, equity holders, representatives,  investors, lenders, officers, employees, agents or accountants, provided that such parties likewise  agree to be bound by this covenant of confidentiality, or are otherwise subject to confidentiality  restrictions, (ii) with prior (if feasible) written notice to Purchaser, disclosure required by law, rule,  regulation or order of a court or other regulatory body, (iii) with prior (if feasible) written notice  to Purchaser, (iv) any disclosures or filing required under SEC or state securities’ laws; provided  that in the case of clause (iv), Seller shall not file the Pricing Side Letter. Notwithstanding any  provision herein to the contrary, Seller may provide copies of the Program Documents (other than  

 

- 50 -    the Pricing Side Letter) and relevant excerpts (but not specific pricing information) from the  Pricing Side Letter to the Seller’s other Creditors (to the extent required by such other Creditors).   Notwithstanding anything herein to the contrary, except as reasonably necessary to comply with  applicable securities laws, each party (and each employee, representative, or other agent of each  party) may disclose to any and all persons, without limitation of any kind, the tax treatment and  tax structure of the transaction and all materials of any kind (including opinions or other tax  analyses) that are provided to it relating to such tax treatment and tax structure.  For this purpose,  tax treatment and tax structure shall not include (i) the identity of any existing or future party (or  any Affiliate of such party) to this Agreement or (ii) any specific pricing information or other  commercial terms, including the amount of any fees, expenses, rates or payments arising in  connection with the transactions contemplated by this Agreement.  Purchaser and Agent each agree that it will not purchase, sell or trade any class of  security of the Seller on the basis of any material nonpublic information that is included in the  Confidential Terms in violation of U.S. securities laws.  Notwithstanding anything in this Agreement to the contrary, Seller, Purchaser and  Agent shall comply with all applicable local, state and federal laws, including, without limitation,  all privacy and data protection law, rules and regulations that are applicable to the Related  Mortgage Loans, the Participation Certificates and any applicable terms of this Agreement,  including information relating to any Mortgage Loan that is not related to a Participation  Certificate purchased hereunder and information relating to any other Mortgage Loans of Seller  that is delivered to Purchaser or Agent by another lender under an intercreditor agreement or other  agreement (the “Confidential Information”). Seller, Purchaser and Agent understand that the  Confidential Information may contain “nonpublic personal information”, as that term is defined in  Section 509(4) of the Gramm-Leach-Bliley Act (the “GLB Act”), and  each agrees to maintain  such nonpublic personal information that it receives hereunder in accordance with the GLB Act  and other applicable federal and state privacy laws. Seller, Purchaser and Agent shall each  implement such physical and other security measures as shall be necessary to (a) ensure the  security and confidentiality of the “nonpublic personal information” of the “customers” and  “consumers” (as those terms are defined in the GLB Act) of the Mortgagors, (b) protect against  any threats or hazards to the security and integrity of such nonpublic personal information, and (c)  protect against any unauthorized access to or use of such nonpublic personal information. Seller,  Purchaser and Agent shall notify the other party immediately following discovery of any breach  or compromise of the security, confidentiality, or integrity of the nonpublic personal information  of any Mortgagor by providing notice directly to the other party.  Section 28. Contractual Recognition of Bail-In.  Seller acknowledges and agrees that notwithstanding any other term of this Agreement or  any other agreement, arrangement or understanding with us, any of our liabilities, as the Bank of  England (or any successor resolution authority) may determine, arising under or in connection with  this Agreement may be subject to Bail-In Action and Seller accepts to be bound by the effect of:   (a)    any Bail-In Action in relation to such liability, including (without limitation):    (i)     a reduction, in full or in part, of any amount due in respect of any such liability; 

 

- 51 -    (ii)    a conversion of all, or part of, any such liability into shares or other instruments  of ownership that may be issued to, or conferred on, Seller; and  (iii)   a cancellation of any such liability; and    (b)   a variation of any term of this Agreement to the extent necessary to give effect to Bail- In Action in relation to any such liability.    Section 29. USA Patriot Act; OFACSanctions and Anti-Terrorism.37  Each of Purchaser and Agent hereby notifies the Seller that pursuant to the  requirements of the USA PATRIOT Improvement and Reauthorization Act, Title III of Pub. L.  109-177 (signed into law March 9, 2009) (the “Act”), it is required to obtain, verify, and record  information that identifies the Seller, which information includes the name and address of the  Seller and other information that will allow each of Purchaser and Agent, as applicable, to identify  the Seller in accordance with the Act. Accordingly, the Seller hereby represents and warrants to  each of Purchaser and Agent, and shall on and as of the Purchase Date for any Transaction and on  and as of each date thereafter through and including the related SettlementRepurchase Date be  deemed to represent and warrant to each of Purchaser and Agent that:  (a) (i) Neither the Seller, nor the Parent Company nor, to the Seller’s actual  knowledge, any director, officer, or employee of the Seller or any of its subsidiaries, or any  originator of Collateral,a Purchased Asset is named on the list of Specifically Designated  Nationals maintained by OFAC or any similar sanctions list issued by OFAC, OFSI, or  any other Governmental Authority (collectively, the “OFACSanctions Lists”) or is  located, organized, or resident in a country or territory that is, or whose government is, the  target of sanctions imposed by OFAC; and, OFSI, or any other Governmental  Authority; (ii) no Person or Persons on the OFACSanctions Lists owns, whether  individually or in the aggregate, directly or indirectly, a fifty percent or greater  interest, or otherwise controls, the Seller or, the Parent Company. or any Originator; and  (iii) to the knowledge of the Seller, neither the Purchaser nor Agent is precluded by  any Economic and Trade Sanctions and Anti-Terrorism Laws from entering into this  Agreement or any transactions pursuant to this Agreement with the Seller due to the  ownership or control by any person or entity of stocks, shares, bonds, debentures,  notes, drafts or other securities or obligations of the Seller.   (b) (i) Seller will not knowingly conduct business with or engage in any  transaction with any Obligor that the Seller or any originator of Collaterala Purchased  Asset knows, after reasonable due diligence, that, (x) is named on any of the  OFACSanctions Lists or is located, organized, or resident in a country or territory that is,  or whose government currently is, the target of countrywide sanctions imposed by OFAC or any other Governmental Authority; (y) is owned, directly or indirectly, or otherwise  controlled, by a Person named on any OFACSanctions List; (ii) if the Seller obtains actual  knowledge, after reasonable due diligence, that any Obligor is named on any of the    37 Section 29 was amended by Amendment No. 2, dated as of April 28, 2022.  

 

- 52 -    OFACSanctions Lists or that any Person named on an OFAC List owns,or Persons on  the Sanctions Lists owns, whether individually or in the aggregate, directly or  indirectly, a fifty percent or greater interest, or otherwise controls, the Obligor, or the  Seller, as applicable, Seller will give prompt written notice to the Purchaser and Agent of  such fact or facts; and (iii) the Seller will (x) comply at all times with the requirements of  the Economic and Trade Sanctions and Anti-Terrorism Laws applicable to any  transactions, dealings or other actions relating to this Agreement, except to the extent such  non-compliance does not result in a violation of applicable law by any of Purchaser  or Agent  and (y) will, upon the Purchaser’s or Agent’s reasonable request from time to  time during the term of this Agreement, deliver a certification confirming its compliance  with the covenants set forth in this Section 29.  Section 30. Contractual Recognition of UK Stay In Resolution¶.  (a) Where a resolution measure is taken in relation to any BRRD undertaking or any  member of the same group as that BRRD undertaking  and that BRRD undertaking or any member  of the same group as that BRRD undertaking  is a party to this Agreement (any such party to this  Agreement being an “Affected Party”), each other party to this Agreement agrees that it shall only  be entitled to exercise any termination right under this Agreement against the Affected Party  to  the extent that it would be entitled to do so under the Special Resolution Regime if this Agreement  were governed by the laws of any part of the United Kingdom.    (b) For the purpose of this Section 30 “resolution measure” means a ‘crisis prevention  measure’, ‘crisis management measure’ or ‘recognised third-country resolution action’, each with  the meaning given in the “PRA Rulebook: CRR Firms and Non-Authorised Persons: Stay in  Resolution Instrument 2015”, as may be amended from time to time (the “PRA Contractual Stay  Rules”), provided, however, that ‘crisis prevention measure’ shall be interpreted in the manner  outlined in Rule 2.3 of the PRA Contractual Stay Rules ; “BRRD undertaking”, “group”, “Special  Resolution Regime” and “termination right” have the respective meanings given in the PRA  Contractual Stay Rules.  Section 31. Notice Regarding Client Money Rules. ¶  (a) The Purchaser, as a CRD credit institution (as such term is defined in the  rules of the FCA), holds all money received and held by it hereunder as banker and not as trustee.  Accordingly, money that is received and held by Purchaser from Seller will not be held in  accordance with the provisions of the FCA’s Client Asset Sourcebook relating to client money  (the “Client Money Rules”) and will not be subject to the statutory trust provided for under the  Client Money Rules.  (b) In particular, the Purchaser shall not segregate money received by it from  Seller from the Purchaser money and the Purchaser shall not be liable to account to Seller for any  profits made by the Purchaser use as banker of such cash and upon failure of the Purchaser, the  client money distribution rules within the Client Asset Sourcebook (the “Client Money  Distribution Rules”) will not apply to these sums and so Seller will not be entitled to share in any  distribution under the Client Money Distribution Rules.  

 

- 53 -    Section 32. Effect of Benchmark Transition Event.38  (a) Notwithstanding anything to the contrary herein or in any other Program  Document, upon the occurrence of a Benchmark Transition Event or an Early Opt-in  Election, as applicable, the Agent and the Seller may amend this Agreement to replace  LIBOR with a Benchmark Replacement. Any such amendment with respect to a Benchmark  Transition Event will become effective at 5:00 p.m. on the fifth (5th) Business Day after the  Agent has posted such proposed amendment to the Purchaser and the Seller. Any such  amendment with respect to an Early Opt-in Election will become effective on the date that  the Purchaser has delivered to the Agent written notice that the Purchaser accepts such  amendment. No replacement of LIBOR with a Benchmark Replacement pursuant to this  Section titled “Effect of Benchmark Transition Event” will occur prior to the applicable  Benchmark Transition Start Date.  (a) Upon the occurrence of a Benchmark Transition Event, the Benchmark  Replacement will replace the then-current Benchmark for all purposes hereunder and under  any Program Document in respect of any Benchmark setting at or after 5:00 p.m. on the fifth  (5th) Business Day after the date notice of such Benchmark Replacement is provided to  Purchaser and Seller without any amendment to, or further action or consent of any other  party to, this Agreement or any other Program Document so long as the Agent has not  received, by such time, written notice of objection to such Benchmark Replacement from  Purchaser [or Seller].  At any time that the administrator of the then-current Benchmark  has permanently or indefinitely ceased to provide such Benchmark or such Benchmark has  been announced by the regulatory supervisor for the administrator of such Benchmark  pursuant to public statement or publication of information to be no longer representative of  the underlying market and economic reality that such Benchmark is intended to measure  and that representativeness will not be restored, the Seller may revoke any request for a  transaction to be made or continued hereunder that would bear interest by reference to such  Benchmark until the Seller’s receipt of notice from the Agent that a Benchmark  Replacement has replaced such Benchmark. (b) In connection with the implementation and administration of a Benchmark  Replacement, the Agent will have the right to make Benchmark Replacement Conforming  Changes from time to time and, notwithstanding anything to the contrary herein or in any other  Program Document, any amendments implementing such Benchmark Replacement Conforming  Changes will become effective without any further action or consent of any other party to this  Agreement.  (c) The Agent will promptly notify the Seller and the Purchaser of (i) any occurrence  of a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related  Benchmark Replacement Date and Benchmark Transition Start Date, (ii) the implementation  of any Benchmark Replacement, and (iiiii) the effectiveness of any Benchmark Replacement  Conforming Changes and (iv) the commencement or conclusion of any Benchmark  Unavailability Period.     38 Section 32 was amended by Amendment No. 2, dated as of April 28, 2022.  

 

- 54 -    (d) Any determination, decision or election that may be made by the Agent or  Purchaser pursuant to this Section titled “Effect of Benchmark Transition Event,”32, including  any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence  of an event, circumstance or date and any decision to take or refrain from taking any action, will  be conclusive and binding absent manifest error and may be made in its or their sole discretion and  without consent from any other party hereto, except, in each case, as expressly required pursuant  to this Section titled “Effect of Benchmark Transition Event.” 32.  (e) Upon the Seller’s receipt of notice of the commencement of a Benchmark  Unavailability Period and until such Benchmark Unavailability Period ends, the Seller shall  apply an alternate benchmark rate (which may be a SOFR-Based Rate) that has been  mutually agreed upon by the Agent and the Seller.  

 

Mortgage Loan Participation Purchase and Sale Agreement Signature Page  IN WITNESS WHEREOF, Purchaser, Agent and Seller have duly executed this  Agreement as of the date and year set forth on the cover page hereof.  BARCLAYS BANK PLC  By:   Name:  Title:  LOANDEPOT.COM, LLC  By:  Name:  Title:  Acknowledged and Agreed with respect to Section 3:  BARCLAYS CAPITAL INC.  By:       Name:  Title:  

 

A-1  Exhibit A  PARTICIPATION CERTIFICATE  POOL NO. (or Freddie Mac CONTRACT NO.): This participation certificate evidences a one hundred percent (100%) undivided beneficial  ownership interest in (including the right to receive the payments of principal of and interest on)  the Mortgage Loans (the “Participation Certificate”) identified:   (Check Box)  (a) Form HUD 11706 (Schedule of Pooled Mortgages);    (b) Fannie Mae Form 2005 (Schedule of Mortgages); or    (c) Freddie Mac Form 1034 (Fixed-Rate Custodial Certification Schedule) or  Selling System computer tape.    This Participation Certificate has been sold to Purchaser (as defined herein) pursuant to the  terms of that certain Mortgage Loan Participation Purchase and Sale Agreement, dated August 25,  2020 (the “Agreement”) between loanDepot.com, LLC, as seller (the “Seller”), and Barclays Bank  PLC, as purchaser (the “Purchaser”) and as agent (the “Agent”). Capitalized terms used but not  defined herein shall have the meanings set forth in the Agreement, the terms of which are hereby  incorporated by reference and made a part of this Participation Certificate. Upon Delivery of the related Security to Purchaser or its Assignee, Purchaser’s beneficial  ownership interest in the Mortgage Loans evidenced in this Participation Certificate shall terminate  in exchange for such Security, and this Participation Certificate shall be void and of no further  effect.  Purchaser and Seller confirm that the transaction contemplated herein pursuant to the  Agreement is intended to be a sale of this Participation Certificate by Seller to Purchaser rather  than borrowings secured by this Participation Certificate. In the event, for any reason, this  transaction is construed by any court or regulatory authority as a borrowing rather than as a sale,  Seller and Purchaser intend that Purchaser shall have a perfected first priority security interest in  this Participation Certificate and all of Seller’s interest in all of the servicing rights with respect to  the above-described Mortgage Loans ("Mortgage Loan Pool"); the Custodial Account and all amounts on deposit therein; all documents, records (including Servicing Records), instruments and  data evidencing the Mortgage Loan Pool and the servicing thereof; all principal and interest  collected thereon and all proceeds thereof; the Takeout Commitments related to the Participation  Certificate; and the proceeds of any and all of the foregoing (all of the foregoing property,  collectively, the “Collateral”), free and clear of adverse claims. In furtherance thereof, Seller  hereby grants to Purchaser a first priority security interest in and lien upon the Collateral, free and  clear of adverse claims.  

 

A-2  This Participation Certificate may be amended only by a written agreement between Seller,  Purchaser and Agent.  LOANDEPOT.COM, LLC  By:  Its:  Date:  

 

A-3  AGGREGATE PRINCIPAL BALANCES OF THE MORTGAGE LOANS (GIVING EFFECT  TO PAYMENTS MADE AS OF _______, ____): $_____________________    Hereby authenticated by Deutsche Bank  National Trust Company pursuant to the  Custodial Agreement (May not be  applicable for Freddie Mac)  By:   Its:  Date:   

 

B-1  Exhibit B  TRADE ASSIGNMENT  __________ (“Takeout Investor”)  (Address)  Attention:          Fax No.:           Ladies and Gentlemen:  Attached hereto is a correct and complete copy of your confirmation of commitment (the  “Commitment”), trade-dated _________ __, ____, to purchase $______ of __% ___ year,   (Check Box)  Government National Mortgage Association;    Federal National Mortgage Association; or     Federal Home Loan Mortgage Corporation.  mortgage-backed pass-through securities (“Securities”) at a purchase price of ___________ from  _________ on (insert Settlement Date). Our intention is to assign $_____ of this Commitment’s  full amount, which assignment shall be effective and shall be fully enforceable by the assignee on  the Settlement Date. This is to confirm that (i) the form of this assignment conforms to the SIFMA  guidelines, (ii) the Commitment is in full force and effect, (iii) effective as of the Settlement Date,  the Commitment is hereby assigned to Barclays Capital Inc. (“BCI”), whose acceptance of such  assignment is indicated below, (iv) you will accept delivery of such Securities directly from BCI,  (v) you will pay BCI for such Securities, (vi) effective as of the Settlement Date and provided the  Securities have been issued, BCI is obligated to make delivery of such Securities to you in  accordance with the attached Commitment and (vii) effective as of the Settlement Date and  provided the Securities have been issued, you have released Seller from its obligation to deliver  the Securities to you under the Commitment. Payment will be made “delivery versus payment  (DVP)” to BCI in immediately available funds.  Please acknowledge your acceptance of the foregoing by countersigning below and  delivering an executed copy of this Trade Assignment to _______________ at fax # (___) ___- ____. Notification of incorrect information or rejection of this Trade Assignment or any questions  regarding this Trade Assignment should be immediately made to [_____].   Very truly yours,  loanDepot.com, LLC  

 

B-2  By:  Title:  Date:  Acknowledged and agreed to:  BARCLAYS CAPITAL INC.   By:________________________  Title:______________________  Date:______________________  Provided the Securities have been issued, notice of delivery and confirmation of receipt will be the  obligations of Barclays.   Acknowledged and agreed to:  [TAKEOUT INVESTOR]   By:________________________  Title:______________________  Date:______________________  

 

C-1  Exhibit C RESERVED     

 

D-1  Exhibit D  WAREHOUSE LENDER’S RELEASE  Barclays Bank PLC  745 Seventh Avenue, 2nd Floor  New York, New York 10019  Attention: US Residential Financing2539  Ladies and Gentlemen:  Capitalized terms used herein but not defined herein shall have the meanings ascribed to  such terms in the Custodial Agreement, dated as of August 25, 2020, among Barclays Bank PLC,  loanDepot.com, LLC and Deutsche Bank National Trust Company.  We hereby release all right, interest or claim of any kind, including any security interest or  lien, with respect to the mortgage loans referenced in the attached schedule (Ginnie Mae/Fannie  Mae/Freddie Mac Pool/Contract #__________), such release to be effective automatically without  any further action by any party, upon payment, in one or more installments, from Barclays Bank  PLC, in accordance with the Wire Instructions in effect on the date of such payment, in  immediately available funds, of an aggregate amount equal to the product of A multiplied by B  (such product being rounded to the nearest $0.01) multiplied by C.*  Very truly yours,  [WAREHOUSE LENDER]  *A = weighted average Trade Price (expressed as a  percentage of the initial aggregate principal  balance of the Mortgage Loans)  B = principal amount of the Mortgage Loans       backing the Security  C = 1 minus the Discount    2539 The notice address was amended by Amendment No. 1, dated as of September 24, 2021.  

 

E-1  Exhibit E  ASSIGNMENT  FOR VALUE RECEIVED the undersigned hereby sell(s) and assign(s) and transfer(s) unto   (Please print or typewrite name and address, including postal zip code of assignee)  an undivided Participation Interest Equal to     % of the beneficial interest in the Mortgage Loans  relating to the within Participation Certificate, Pool No. (Freddie Mac Contract No.)     , Pass- Through Rate     , Discount       and hereby authorize(s) the transfer of registration of such interest  to assignee.  [Assignor]  By:  Name:  Title:  Dated:________________  

 

F-1    Exhibit F  FORM OF CONFIRMATION  TO: loanDepot.com, LLC  26642 Towne Centre Drive  Foothill Ranch, California 92610  Attention: Sheila Mayes, EVP, Treasurer2640  email: smayes@loandepot.com    Attention: Patrick Flanagan, Chief Financial Officer   email: pflanagan@loandepot.com    Attention: Office of General Counsel email: CM_Legal@loandepot.com.2741   DATE:  RE: Confirmation of Purchase of a beneficial interest in   Mortgage Loans relating to a Participation Certificate   Barclays Bank PLC (“Purchaser” and “Agent”) is pleased to confirm its agreement to  purchase and your agreement to sell a 100% undivided, beneficial interest in the Mortgage Loans  relating to a Participation Certificate relating to the pool number (or Freddie Mac Contract  Number) referred to herein, pursuant to the Mortgage Loan Participation Purchase and Sale  Agreement, dated as of August 25, 2020 (the “Agreement”), between Purchaser, Agent and Seller,  under the following terms and conditions.    2640 Contact information was amended by Amendment No. 1, dated as of September 24, 2021.  2741 Contact information was amended by Amendment No. 1, dated as of September 24, 2021.  

 

F-2    Pool No. (or Freddie Mac Contract No.)  Applicable Agency  Purchase Date   Anticipated Delivery Date Settlement Date  Trade Price  Purchase Price: Initial Purchase Price Installment Final Purchase Price Installment  Face Amount of the Security_________________________  Pass Through Rate  [Other information TBD]    

 

F-3    Capitalized terms used and not otherwise defined herein shall have the meanings ascribed in the  Agreement. Very truly yours,  BARCLAYS BANK PLC  By:  Name:  Title:  Agreed to by:  LOANDEPOT.COM, LLC  By: ______________________________  Name:  Title:Document

FOURTEEENTH AMENDMENT TO CREDIT AND SECURITY AGREEMENT 

THIS FOURTEENTH AMENDMENT TO CREDIT AND SECURITY AGREEMENT (this “Amendment”) is entered into as of April 28, 2022, between LOANDEPOT.COM, LLC, a Delaware limited liability company (“Borrower”), and NEXBANK  (with its participants, successors and assigns, “Lender”).
R E C I T A L S
A.    Borrower and Lender are parties to that certain Credit and Security Agreement dated as of October 29, 2014 (as amended, modified, supplemented, restated or amended and restated from time to time, the “Loan Agreement”). Unless otherwise indicated herein, all terms used with their initial letter capitalized are used herein with their meaning as defined in the Loan Agreement and all Section references are to Sections in the Loan Agreement. 
B.    Borrower has requested that Lender amend the Loan Agreement as provided below.
C.    Borrower and Lender desire to amend the Loan Documents, subject to the terms, conditions, and representations set forth herein, as requested by Borrower.
D.    Borrower and Lender agree to the other terms and provisions provided below, subject to the terms, conditions, and representations set forth herein.
NOW, THEREFORE, in consideration of these premises and other valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree, as follows:
1.Amendments to Loan Agreement. Subject to the satisfaction of the conditions set forth herein, the Loan Agreement is amended as reflected on Annex A attached hereto.
2.Conditions Precedent. Notwithstanding any contrary provision, this Amendment shall be effective on the first Business Day upon which all of the following conditions precedent have been satisfied (the “Effective Date”):
(a)Lender shall have received counterparts of this Amendment executed by Borrower, Lender, and each other party set forth on the signature pages hereto;
(b)Lender shall have received counterparts of the Side Letter executed by Borrower;
(c)Lender shall have received satisfactory evidence that Borrower has paid the fees and expenses of counsel described in Section 5; 
(d)No Default or Event of Default shall have occurred and be continuing or shall result after giving effect to this Amendment; and
(e)Lender shall have received such other instruments and documents incidental and appropriate to the transactions provided for herein as Lender or its counsel may reasonably request, and all such documents shall be in form and substance satisfactory to Lender (it being agreed that execution of this Amendment by Lender shall evidence that the foregoing conditions have been fulfilled).
3.Reaffirmation of Loan Documents and Liens. Except as amended and modified hereby, any and all of the terms and provisions of the Loan Agreement and the other Loan Documents shall remain in full force and effect and are hereby in all respects ratified and confirmed by Borrower.  Borrower hereby agrees that, except as expressly provided in this Amendment, the amendments and modifications herein contained shall in no manner affect or impair the liabilities, duties and obligations of Borrower under the Loan Agreement and the other Loan Documents or the Liens securing the payment and performance thereof. Borrower further confirms that the liens and security interests in the Collateral created under the Loan Documents secure, among other indebtedness, Borrower’s obligations under 

the Loan Documents, and all modifications, amendments, renewals, extensions, and restatements thereof. 
4.Representations and Warranties.  As a material inducement for Lender to enter into this Amendment, Borrower hereby represents and warrants to Lender (with the knowledge and intent that Lender is relying upon the same in consenting to this Amendment) that as of the Effective Date, and after giving effect to the transactions contemplated by this Amendment: (a) all representations and warranties in the Loan Agreement and in all other Loan Documents are true and correct in all material respects, as though made on the date hereof, except to the extent that (i) any of them speak to a different specific date; or (ii) the facts or circumstances on which any of them were based have been changed by transactions or events not prohibited by the Loan Documents; (b) no Default or Event of Default exists under the Loan Documents or will exist after giving effect to this Amendment; (c) this Amendment has been duly authorized and approved by all necessary organizational action and requires the consent of no other Person, and is binding and enforceable against Borrower in accordance with its terms; and (d) the execution, delivery and performance of this Amendment in accordance with its terms, does not and will not, by the passage of time, the giving of notice, or otherwise: (i) require any governmental approval, other than such as have been obtained and are in full force and effect, or violate any applicable law relating to Borrower; (ii) conflict with, result in a breach of, or constitute a default under the Constituent Documents of Borrower thereof, or any indenture, agreement, or other instrument to which Borrower is a party or by which it or any of its properties may be bound; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by Borrower.
5.Fees, Costs and Expenses.  Borrower agrees to pay promptly the reasonable fees and expenses of counsel to Lender for services rendered in connection with the preparation, negotiation, reproduction, execution, and delivery of this Amendment and all related documents; and
6.Miscellaneous.
(a)This Amendment shall be deemed to constitute a Loan Document for all purposes and in all respects.  Each reference in the Loan Agreement to “this Agreement,” “hereunder,” “hereof,” “herein” or words of like import, and each reference in the Loan Agreement or in any other Loan Document, or other agreements, documents or other instruments executed and delivered pursuant to the Loan Agreement to the “Loan Agreement”, shall mean and be a reference to the Loan Agreement as amended by this Amendment.
(b)The Loan Documents shall remain unchanged and in full force and effect, except as provided in this Amendment, and are hereby ratified and confirmed.  The execution, delivery, and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any rights of Lender under any Loan Document, nor constitute a waiver under any of the Loan Documents.
(c)All of the terms and provisions of this Amendment shall bind and inure to the benefit of the parties hereto and their respective successors and assigns.
(d)This Amendment may be executed in one or more counterparts and by different parties hereto in separate counterparts each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document.  Facsimiles, documents executed, scanned and transmitted electronically and electronic signatures shall be deemed original signatures for purposes of this Amendment and all matters related thereto, with such facsimile, scanned and electronic signatures having the same legal effect as original signatures. The parties agree that this Amendment may be accepted, executed or agreed to through the use of an electronic signature in accordance with E-SIGN, UETA, and any applicable state law. To the extent this Amendment is accepted, executed or agreed to in conformity with such laws, it will be binding on each party hereto to the same extent as if it were physically executed and each party 

hereby consents to the use of any third party electronic signature capture service providers as may be reasonably chosen by a signatory hereto.
(e)THIS AMENDMENT, THE LOAN AGREEMENT, AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

(f)The headings, captions and arrangements used in this Amendment are, unless specified otherwise, for convenience only and shall not be deemed to limit, amplify or modify the terms of this Amendment, nor affect the meaning thereof.

(g)Any provision of this Amendment held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

(h)This Amendment shall be construed in accordance with and governed by the laws of the State of Texas without regard to its principles of conflicts of laws.

(i)The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of Lender under any of the Loan Documents, nor constitute a waiver of any provision of any of the Loan Documents
[Remainder of Page Intentionally Left Blank; Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have executed this Amendment in multiple counterparts on the date stated on the signature pages hereto, but effective as of Effective Date.

BORROWER:

loanDepot.com, LLC,
a Delaware limited liability company

By:        
    Name: Patrick Flanagan
    Title: Chief Financial Officer

LENDER:

NEXBANK 

By:        
    Name: Kevin Olding
    Title: Senior Vice President  

Signature Page to Fourteenth Amendment

ANNEX A TO FOURTEENTH AMENDMENT TO CREDIT AND SECURITY AGREEMENT

Annex A
CREDIT AND SECURITY AGREEMENT

between

loanDepot.com, LLC
as Borrower

and

NEXBANK
as Lender

DATED AS OF OCTOBER 29, 2014

TABLE OF CONTENTS
    Page
						
	SECTION 1 Definitions	1

	Section 1.1    Definitions.
	1

	Section 1.2    Accounting Matters.
	14

	Section 1.3    ERISA Matters.
	15

	Section 1.4    Other Definitional Provisions.
	15

	SECTION 2 Borrowings	15

	Section 2.1    Borrowings.
	15

	Section 2.2    General Provisions Regarding Interest; Etc.
	16

	Section 2.3    Reserved.
	17

	Section 2.4    Use of Proceeds.
	17

	Section 2.5    Extension of Termination Date
	17

	Section 2.6    Increase in the Maximum Commitment
	17

	SECTION 3 Payments	18

	Section 3.1    Method of Payment.
	18

	Section 3.2    Prepayments.
	18

	Section 3.3    Taxes
	18

	SECTION 4 Security	21

	Section 4.1    Grant of Security Interest.
	21

	Section 4.2    Limited Pledge of Servicing
	23

	Section 4.3    Acknowledgment Agreements
	23

	Section 4.4    Lender Requires Acknowledgment Agreements and Consent Agreements
	24

	Section 4.5    Further Assurances Concerning Collateral
	24

	Section 4.6    Financing Statements Filing Authorization
	24

	Section 4.7    Borrower Remains Liable
	24

	Section 4.8    Rights after Occurrence of Default
	24

	Section 4.9    Attorney-In-Fact Appointment
	25

	Section 4.10    Periodic Valuations of Servicing Rights
	26

	Section 4.11    Collections in General
	26

	Section 4.12    Setoff.
	27

	Section 4.13    Schedules 4.1(a)(2)
	27

	SECTION 5 Conditions Precedent	27

	Section 5.1    Initial Extension of Credit.
	27

	Section 5.2    All Extensions of Credit.
	29

	SECTION 6 Representations and Warranties	29

	Section 6.1    Entity Existence.
	29

	Section 6.2    Financial Statements; Etc.
	29

	Section 6.3    Action; No Breach.
	30

	Section 6.4    Operation of Business.
	30

	Section 6.5    Litigation and Judgments.
	30

    i    Credit and Security Agreement

        

						
	Section 6.6    Rights in Properties; Liens.
	31

	Section 6.7    Enforceability.
	31

	Section 6.8    Approvals.
	31

	Section 6.9    Taxes.
	31

	Section 6.10    Use of Proceeds; Margin Securities.
	31

	Section 6.11    ERISA.
	31

	Section 6.12    Disclosure.
	32

	Section 6.13    Subsidiaries.
	32

	Section 6.14    Agreements.
	32

	Section 6.15    Compliance with Laws.
	32

	Section 6.16    Regulated Entities.
	33

	Section 6.17    Environmental Matters
	33

	Section 6.18    Membership and Standing.
	34

	Section 6.19    Foreign Assets Control Regulations and Anti-Money Laundering.
	34

	Section 6.20    Patriot Act.
	34

	Section 6.21    Nature of Business
	34

	Section 6.22    Borrower’s Address
	34

	Section 6.23    Special Representations Concerning Collateral
	35

	SECTION 7 Affirmative Covenants	36

	Section 7.1    Reporting Requirements.
	36

	Section 7.2    Maintenance of Existence; Conduct of Business.
	38

	Section 7.3    Maintenance of Properties.
	39

	Section 7.4    Taxes and Claims.
	39

	Section 7.5    Insurance.
	39

	Section 7.6    Inspection Rights.
	39

	Section 7.7    Keeping Books and Records.
	39

	Section 7.8    Compliance with Laws.
	39

	Section 7.9    Compliance with Agreements.
	39

	Section 7.10    Further Assurances.
	39

	Section 7.11    ERISA.
	40

	Section 7.12    Additional Subsidiaries.
	40

	Section 7.13    Reserved.
	40

	Section 7.14    Provide Monthly Servicing Appraisals
	40

	Section 7.15    Special Affirmative Covenants Concerning Collateral
	40

	SECTION 8 Negative Covenants	41

	Section 8.1    Reserved.
	41

	Section 8.2    Limitation on Liens
	41

	Section 8.3    Mergers
	41

	Section 8.4    Restricted Payments.
	42

	Section 8.5    Reserved.
	42

	Section 8.6    Transactions With Affiliates.
	42

    ii    Credit and Security Agreement

        

						
	Section 8.7    Disposition of Assets.
	42

	Section 8.8    Reserved.
	42

	Section 8.9    Reserved.
	42

	Section 8.10    Nature of Business.
	42

	Section 8.11    Environmental Protection.
	42

	Section 8.12    Accounting.
	42

	Section 8.13    No Negative Pledge.
	43

	Section 8.14    Reserved.
	43

	Section 8.15    Reserved.
	43

	Section 8.16    OFAC.
	43

	Section 8.17    Reserved.
	43

	Section 8.18    Conditional Repurchase, Indemnity or Other Recourse Obligations
	43

	Section 8.19    Special Negative Covenants Concerning Collateral.
	43

	Section 8.20    Termination of Servicing Agreements or Servicing Rights
	43

	Section 8.21    No Amendments
	44

	SECTION 9 RESERVED	44

	SECTION 10 Default	44

	Section 10.1    Events of Default.
	44

	Section 10.2    Remedies Upon Default.
	46

	Section 10.3    Application of Funds.
	46

	Section 10.4    Performance by Lender.
	46

	SECTION 11 Miscellaneous	47

	Section 11.1    Expenses.
	47

	Section 11.2    INDEMNIFICATION.
	47

	Section 11.3    Limitation of Liability.
	48

	Section 11.4    No Duty.
	48

	Section 11.5    Lender Not Fiduciary.
	48

	Section 11.6    Equitable Relief.
	48

	Section 11.7    No Waiver; Cumulative Remedies.
	48

	Section 11.8    Successors and Assigns.
	48

	Section 11.9    Survival.
	48

	Section 11.10    Amendment.
	49

	Section 11.11    Notices.
	49

	Section 11.12    GOVERNING LAW; VENUE; SERVICE OF PROCESS.
	49

	Section 11.13    Counterparts.
	49

	Section 11.14    Severability.
	50

	Section 11.15    Headings.
	50

	Section 11.16    Participations; Etc.
	50

	Section 11.17    Construction.
	50

	Section 11.18    Independence of Covenants.
	50

	Section 11.19    WAIVER OF JURY TRIAL
	50

    iii    Credit and Security Agreement

        

						
	Section 11.20    Additional Interest Provision.
	50

	Section 11.21    Ceiling Election.
	51

	Section 11.22    USA Patriot Act Notice.
	52

	Section 11.23    NOTICE OF FINAL AGREEMENT.
	52

    iv    Credit and Security Agreement

INDEX TO EXHIBITS
    Exhibit    Description of Exhibit    Section
    D-1    U.S. Tax Compliance Certificate
        (For Foreign Lenders That Are Not 
        Partnerships For U.S. Federal 
        Income Tax Purposes)    3.3
    D-2    U.S. Tax Compliance Certificate
        (For Foreign Participants That Are Not 
        Partnerships For U.S. Federal 
        Income Tax Purposes)    3.3
    D-3    U.S. Tax Compliance Certificate
        (For Foreign Participants That Are 
        Partnerships For U.S. Federal 
        Income Tax Purposes)    3.3
INDEX TO SCHEDULES
    Schedule    Description of Schedule    Section
    4.1(a)(1)    Servicing Rights Subject to Lien    4.1(a)
    4.1(a)(2)    Pledged Servicing Rights    4.1(a)
    5.1(r)    Additional Conditions Precedent    5.1(r)
    6.2    Existing Debt    6.2
    6.5    Litigation and Judgments    6.5
    6.13    Subsidiaries, Ventures, Etc.    6.14
    8.5    Existing Debt owed to Borrower    8.5

    
    v    Credit and Security Agreement

CREDIT AND SECURITY AGREEMENT
THIS CREDIT AND SECURITY AGREEMENT (the “Agreement”), dated as of October 29, 2014 (the “Closing Date”) is between loanDepot.com, LLC, a Delaware limited liability company (“Borrower”), and NEXBANK (“Lender”).
RECITALS
WHEREAS, Borrower has requested that Lender extend a revolving line of credit to Borrower as described in this Agreement.  Lender is willing to make such credit available to Borrower upon and subject to the provisions, terms and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the premises and the mutual covenants contained herein, and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1

Definitions
Section 1.1Definitions.
  As used in this Agreement, all exhibits, appendices and schedules hereto and in any note, certificate, report or other Loan Documents made or delivered pursuant to this Agreement, the following terms will have the meanings given such terms in this Section 1 or in the provision, section or recital referred to below:
“Acknowledgment Agreement” means an acknowledgment agreement in the form prescribed by a Designated Agency to be executed by Borrower, the Lender and such Designated Agency as a condition to Borrower’s pledging any Agency Servicing Rights in respect of Mortgage Loans owned by such Designated Agency to the Lender.
“Affiliate” means, as to any Person, any other Person (a) that directly or indirectly, through one or more intermediaries, controls or is controlled by, or is under common control with, such Person; (b) that directly or indirectly beneficially owns or holds twenty percent (20%) or more of any class of voting stock of such Person; or (c) twenty percent (20%) or more of the voting stock of which is directly or indirectly beneficially owned or held by such Person. The term “control” means the possession, directly or indirectly, of the power to direct or cause direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, or otherwise.  Notwithstanding the foregoing, (A) in no event shall Lender be deemed an Affiliate of Borrower or any Obligated Party, or any of their Subsidiaries or Affiliates; and (B) in no event shall any Person that is controlled by Sponsor or any of its Controlled Investment Affiliates (other than Borrower and its Subsidiaries) constitute an Affiliate of Borrower or its Subsidiaries.
“Agency” means Freddie Mac or any successors thereto or (upon the agreement of Borrower and Lender), any other government mortgage loan program and any successor thereto.
“Agency Guidelines” means, with respect to an Agency, the servicing valuation procedural guidelines set forth by such Agency.
“Agency Servicing Rights” means all of Borrower’s rights and interests under any Servicing Agreement with any Agency, including the rights to (a) service the Serviced Loans that are the subject matter of such Servicing Agreement and (b) be compensated, directly or indirectly, for doing so.
“Agency’s Interest” means the interest of the related Agency in the Collateral pursuant to the terms of the Approved Servicing Agreement and the Acknowledgment Agreement.
D-2294739_9.doc    1    Credit and Security Agreement

“Aggregate Advance Rate” means 70%.
“Agreement” has the meaning set forth in the introductory paragraph hereto, and includes all schedules, exhibits and appendices attached or otherwise identified therewith.
“Appraisal” means an appraisal of Mortgaged Premises by a licensed or otherwise qualified, disinterested and independent appraiser who (a) meets the standards of the Financial Institutions Reform, Recovery & Enforcement Act of 1989 and all requirements of the applicable Agency Guidelines, (b) unless approved by the Lender on a case-by-case basis, is not a director, officer or employee of Borrower or any Affiliate of Borrower and, to the actual knowledge of any corporate vice president and/or more senior officer of Borrower (without independent investigation), is not related as the spouse of, or a parent, sibling, child or first cousin of any customer who is a maker, mortgagor, guarantor or assumptor of the related Mortgage Note or Mortgage or of any of Borrower’s or any of its Affiliates’ respective directors or officers or any of their spouses and (c) if selected by Borrower, was selected reasonably and in good faith. 
“Appraisal Report” means a written report of an Appraisal or a Broker’s Price Opinion of the value of Mortgaged Premises, a signed copy of which is in the possession of Borrower or the Servicer of the related Mortgage Loan, setting forth the relevant appraiser’s or broker’s opinion and method of determination of the fair market value of such Mortgaged Premises, including a statement of all material assumptions made, and dated and signed, by such appraiser or broker, who, and the form of which report, must not be unacceptable to the Lender in its reasonable discretion, it being understood that an appraisal on a form generally acceptable to an Agency will be acceptable to the Lender. 
“Approved Servicing Agreement” means (a) in respect of Agency Servicing Rights, a Servicing Agreement between Borrower and an Agency, (b) in respect of Non-Agency Servicing Rights, a Servicing Agreement between any Person approved by Lender in each case that is not a Recourse Servicing Agreement and (c) with respect of Non-Agency Servicing Rights owned by the Borrower, prudent mortgage loan servicing standards and procedures generally accepted in the mortgage banking industry for mortgage loans of the same type as the Serviced Mortgage Loans in the jurisdiction where Mortgaged Premises is located 
“Approved Servicing Appraiser” means MountainView Capital Markets or any other servicing appraiser acceptable to the Lender.
    “Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.
    “Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.
“Borrower” means the Person identified as such in the introductory paragraph hereto, and its successors and assigns to the extent permitted by Section 11.8.
“Borrowing” means any advance by Lender to Borrower pursuant to Section 2.
“Borrowing Base” means, on any Determination Date, the Collateral Values of the Eligible Servicing Rights that are then Pledged to the Lender; provided that, at any time, the portion of the Borrowing Base attributable to the Non-Agency Servicing Rights shall not exceed 15% of the total Borrowing Base.
 “Borrowing Base Deficiency” has the meaning for such term set forth in Section 3.2(b).
“Borrowing Base Report” means, as of any date of preparation, a certificate, substantially in the form of Exhibit A as set forth in the Pricing Side Letter, prepared by and certified by a Responsible Officer.
 “Borrowing Request Form” means a certificate, in a form approved by Lender, properly completed and signed by Borrower requesting a Borrowing, which certificate shall include a List of Eligible Agency Servicing Rights, a calculation of the Borrowing Base and such other supporting 
    2    Credit and Security Agreement

documentation and information that the Lender may reasonably request, and that, when appropriately completed and submitted with the foregoing required documentation attached, may include requests for Borrowings to finance Eligible Agency Servicing Rights.
“Broker’s Price Opinion” means the written opinion of the value of Mortgaged Premises, issued by a real estate broker duly licensed as such by the jurisdiction in which such Mortgaged Premises are located, reasonably acceptable to the Lender and that is not an Affiliate of Borrower or of any of Borrower’s or its Subsidiaries’ or Affiliates’ directors, members, managers or officers and is not an employee of any of them, selected reasonably and in good faith by Borrower.
“Business Day” has the meaning assigned to it in the Revolving Credit Note.
“Capitalized Lease Obligation” means, with respect to any Person, the amount of Debt under a lease of Property by such Person that would be shown as a liability on a balance sheet of such Person prepared for financial reporting purposes in accordance with GAAP.
“Change of Control” means the occurrence of either of the following: (i) the Sponsor and its Controlled Investment Affiliates and Anthony Hsieh and his Family Affiliates, collectively, cease to own, directly or indirectly, at least 50.01% of Borrower or (ii) Anthony Hsieh and his Family Affiliates, collectively, cease to own, directly or indirectly, at least 25% of Borrower.

“Closing Date” has the meaning set forth in the introductory paragraph hereto. 
“Code” means the Internal Revenue Code of 1986.
“Collateral” has the meaning for such term set forth in Section 4.1; provided, however, that “Collateral” shall not include any Excluded Collateral. 
“Collateral Value” means, as of any Determination Date, 65.0% of the Market Value of all Eligible Agency Servicing Rights as updated for the most recent unpaid principal balance and as most recently determined by a Servicing Appraisal. Such value shall be as determined in accordance with the terms and conditions of this Agreement. The Lender may accept as correct any value proposed by Borrower that is not obviously and materially incorrect on its face, and each determination by the Lender of Collateral Value (and of each element of each such determination, including Market Value) may be computed using any reasonable averaging, interpolation and attribution method and, absent manifest error, shall be conclusive and binding.
“Commitment” means the obligation of Lender to make Borrowings pursuant to Section 2 in an aggregate principal amount at any time outstanding up to but not exceeding $248,000,000, subject, however, to increase pursuant to Section 2.6 and termination pursuant to Section 10.2.
“Compliance Certificate” means a certificate, substantially in the form of Exhibit B as set forth in the Pricing Side Letter, prepared by and certified by a Responsible Officer.
“Constituent Documents” means (a) in the case of a corporation, its articles or certificate of incorporation and bylaws; (b) in the case of a general partnership, its partnership agreement; (c) in the case of a limited partnership, its certificate of limited partnership and partnership agreement; (d) in the case of a trust, its trust agreement; (e) in the case of a joint venture, its joint venture agreement; (f) in the case of a limited liability company, its certificate of formation and limited liability company agreement; and; and (g) in the case of any other entity, its organizational and governance documents and agreements.
“Consumer Lending Business” means the businesses of (i) making residential mortgage loans and other secured and unsecured loans to borrowers who are primarily consumers (as opposed to commercial entities) and (ii) providing real estate services.  
 “Controlled Investment Affiliates” means, with respect to Sponsor, any fund or investment vehicle that (i) is organized by Sponsor for the purpose of making investments in one or more companies 
    3    Credit and Security Agreement

and is controlled by Sponsor or (ii) has the same principal fund advisor or manager as Sponsor or an Affiliate of such advisor or manager (provided that for purposes of the use of the term “Affiliate” in this definition, the term “control” shall have a control threshold of a majority (more than 50%) rather than 20%). For purposes of this definition “control” means the power to direct or cause the direction of management and policies of a Person, whether by contract or otherwise 
“Customer” means and includes each maker of a Mortgage Note and each cosigner, guarantor, endorser, surety and assumptor thereof, and each mortgagor or grantor under a Mortgage, whether or not such Person has personal liability for its payment of the Mortgage Loan evidenced or secured thereby, in whole or in part. 
“Debt” means, of any Person as of any date of determination (without duplication): (a) all obligations of such Person for borrowed money; (b) all obligations of such Person evidenced by bonds, notes, debentures, or other similar instruments; (c) all obligations of such Person to pay the deferred purchase price of Property or services, except trade accounts payable of such Person arising in the Ordinary Course of Business that are not past due by more than ninety (90) days; (d) all Capitalized Lease Obligations of such Person; (e) all Debt or other obligations of others Guaranteed by such Person; (f) all obligations secured by a Lien existing on Property owned by such Person, whether or not the obligations secured thereby have been assumed by such Person or are non-recourse to the credit of such Person; (g) any other obligation for borrowed money or other financial accommodations which in accordance with GAAP would be shown as a liability on the balance sheet of such Person; (h) any repurchase obligation or liability of a Person with respect to accounts, chattel paper or notes receivable sold by such Person; (i) any liability under a sale and leaseback transaction that is not a Capitalized Lease Obligation; (j) any obligation under any so-called “synthetic leases;” (k) any obligation arising with respect to any other transaction that is the functional equivalent of borrowing but which does not constitute a liability on the balance sheets of a Person; (l) all payment and reimbursement obligations of such Person (whether contingent or otherwise) in respect of letters of credit, bankers’ acceptances, surety or other bonds and similar instruments; and (m) all liabilities of such Person in respect of unfunded vested benefits under any Plan.
“Default” means the occurrence of an event or condition which with notice or lapse of time or both would become an Event of Default.
“Default Interest Rate” has the meaning assigned to it in the Revolving Credit Note.
“Defaulted Mortgage Loan” means, a Mortgage Loan with respect to which any Mortgage Note payment or escrow payment is unpaid for 30 days or more after its due date (whether or not Borrower has allowed any grace period or extended the due date thereof by any means) or another material default has occurred and is continuing, including the commencement of foreclosure proceedings or the commencement of a case in bankruptcy for any Customer under such Mortgage Loan.
“Designated Agency” means an Agency that is a party to one or more Approved Servicing Agreements. 
“Determination Date” means the date as of, or for, which a specified subject matter is being determined for purposes of a provision of this Agreement or another Loan Document. 
“Dollars” and “$” mean lawful money of the United States of America.
“Eligible Servicing Rights” means, as of any Determination Date, Pledged Servicing Rights as to which each of the representations and warranties with respect to such Servicing Rights set forth in this Agreement are true and correct on the date of each Borrowing and the date of each submission of a Borrowing Base Report, including, without limitation: (a) such Servicing Rights are held by Borrower giving Borrower the right to service (and be compensated as servicer for servicing) a portfolio of Single-family Mortgage Loans pursuant to an Approved Servicing Agreement, (b) such Servicing Rights have not been rejected by the Lender, (c) such Servicing Rights are held by Borrower free and clear of all Liens (other than the Lender’s Lien) and the Lender has been granted and continues to hold a readily enforceable, first priority perfected Lien on such Servicing Rights, subject and subordinate to all rights, 
    4    Credit and Security Agreement

powers and prerogatives of Freddie Mac under and in connection with the Freddie Mac Guide and the Purchase Documents (as defined in the Freddie Mac Guide) or any owner of the related Mortgage Loan, (d) in the case of each Servicing Agreement between Borrower and any Agency, is subject to an Acknowledgment Agreement with such Agency, (e) the Mortgage Loans related to such Servicing Rights are with a holder or custodian for a holder of such Mortgage Loans who is acceptable to the Lender, (f) the Servicing Agreement related to such Servicing Rights is not a subservicing arrangement, (g) the Servicing Agreement related to such Servicing Rights is in full force and effect and is legal, valid and enforceable in accordance with its terms, and no default or event that, with notice or lapse of time or both, would become a default, exists under such Servicing Agreement and (h) Borrower’s rights to payment under the related Servicing Agreement are genuine and enforceable without defense, offset, bona fide counterclaim or bona fide defense.
“Environmental Laws” means any and all federal, state, and local laws, regulations, judicial decisions, orders, decrees, plans, rules, permits, licenses, and other governmental restrictions and requirements pertaining to health, safety, or the environment, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9601 et seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et seq., the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq., the Clean Air Act, 42 U.S.C. § 7401 et seq., the Clean Water Act, 33 U.S.C. § 1251 et seq., and the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.
“Environmental Liabilities” means, as to any Person, all liabilities, obligations, responsibilities, Remedial Actions, losses, damages, punitive damages, consequential damages, treble damages, costs, and expenses (including, without limitation, all reasonable fees, disbursements and expenses of counsel, expert and consulting fees and costs of investigation and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand, by any Person, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute, including any Environmental Law, permit, order or agreement with any Governmental Authority or other Person, arising from environmental, health or safety conditions or the Release or threatened Release of a Hazardous Material into the environment, resulting from the past, present, or future operations of such Person or its Affiliates.
“ERISA” means the Employee Retirement Income Security Act of 1974.
“ERISA Affiliate” means any corporation or trade or business which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Code) as Borrower or any Obligated Party or is under common control (within the meaning of Section 414(c) of the Code and Sections 414(m) and (o) of the Code for purposes of the provisions relating to Section 412 of the Code) with Borrower or any Obligated Party.
“ERISA Event” means (a) a Reportable Event with respect to a Plan, (b) a withdrawal by Borrower or any Obligated Party or any ERISA Affiliate from a Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations which is treated as such a withdrawal under Section 4062(e) of ERISA, (c) a complete or partial withdrawal by Borrower or any Obligated Party or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization, (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Plan or Multiemployer Plan, (e) the occurrence of an event or condition which might reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan or Multiemployer Plan, (f) the imposition of any liability to the PBGC under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon Borrower or any Obligated Party or any ERISA Affiliate, (g) the failure of Borrower or any Obligated Party or ERISA Affiliate to meet any funding obligations with respect to any Plan or Multiemployer Plan, or (h) a Plan becomes subject to the at-risk requirements in Section 303 of ERISA and Section 430 of the Code.  
“Event of Default” has the meaning set forth in Section 10.1.
    5    Credit and Security Agreement

“Excluded Collateral” means (a) Agency Servicing Rights that as of the Closing Date are identified as “Excluded Collateral” on Schedule 4.1(a)(1) delivered by Borrower to Lender on the Closing Date and (b) payments of principal, interest, taxes and/or insurance made by Borrower in respect of a Mortgage Loan owned or guaranteed by Freddie Mac.
 “Excluded Taxes” means any of the following Taxes imposed on or with respect to a recipient or required to be withheld or deducted from a payment to a recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in the Borrowings or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Borrowings or Commitment or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 3.3, amounts with respect to such Taxes were payable either to such Lender's assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such recipient’s failure to comply with Section 3.3 and (d) any U.S. federal withholding Taxes imposed under FATCA.
“Existing Unsecured Term Loan” means the $250,000,000 unsecured term loan dated as of August 3, 2017, among loanDepot.com, LLC, as borrower and US Bank National Association, as Paying Agent.
“Facility Increase Request” means a notice substantially in the form of Exhibit C as set forth in the Pricing Side Letter pursuant to which Borrower requests an increase in the amount of the Maximum Commitment in accordance with Section 2.06.
    “Family Affiliates” means any member of Anthony Hsieh’s family or trust established or controlled by Anthony Hsieh.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof.
 “Fitch” means Fitch Ratings, Inc., or any successor thereto. 
“Freddie Mac” means the Federal Home Loan Mortgage Corporation and any successor. 
“Freddie Mac Guide” shall mean the Freddie Mac Single-Family Seller/Servicer Guide, as it may be amended from time to time. 
“GAAP” means generally accepted accounting principles, applied on a consistent basis, as set forth in opinions of the Accounting Principles Board of the American Institute of Certified Public Accountants and/or in statements of the Financial Accounting Standards Board and/or their respective successors and which are applicable in the circumstances as of the date in question.  Accounting principles are applied on a “consistent basis” when the accounting principles applied in a current period are comparable in all material respects to those accounting principles applied in a preceding period.
“Governmental Authority” means any nation or government, any state or political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory, or administrative functions of or pertaining to government.
“Guarantee” by any Person means any obligation or liability, contingent or otherwise, of such Person directly or indirectly guaranteeing any Debt or other obligation of any other Person as well as any obligation or liability, direct or indirect, contingent or otherwise, of such Person (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or other obligation or liability (whether arising by virtue of partnership arrangements, by agreement to keep-well, to purchase assets, 
    6    Credit and Security Agreement

goods, securities or services, to operate Property, to take-or-pay, or to maintain net worth or working capital or other financial statement conditions or otherwise) or (b) entered into for the purpose of indemnifying or assuring in any other manner the obligee of such Debt or other obligation or liability of the payment thereof or to protect the obligee against loss in respect thereof (in whole or in part), provided that the term Guarantee shall not include endorsements for collection or deposit in the Ordinary Course of Business.  The term “Guarantee” used as a verb has a corresponding meaning.
“Hazardous Material” means any substance, product, waste, pollutant, material, chemical, contaminant, constituent, or other material which is or becomes listed, regulated, or addressed under any Environmental Law, including, without limitation, asbestos, petroleum, and polychlorinated biphenyls.
“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of the Borrower under this Agreement and (b) to the extent not otherwise described in (a), Other Taxes.
“Intellectual Property” means all copyrights, copyright licenses, patents, patent licenses, trademarks, trademark licenses and other types of intellectual property, in whatever form, now owned or hereafter acquired.
“Interest Credit” has the meaning set forth in Section 2.3. 
“Interest Rate Sensitivity Analysis” means an analysis with respect to the Serviced Loans that demonstrates the effect of a 25 basis point, 50 basis point, and 100 basis point increase and decrease in market interest rates on such Serviced Loans.
“IRS” means the Internal Revenue Service or any entity succeeding to all or any of its functions.
“I-Unitholder” means each holder of a Class I Common Unit of LD Holdings, which have no voting rights but are entitled to distributions under certain circumstances as described in LD Holdings’ limited liability company agreement.

 “Laws” means any law, statute, code, ordinance, order, rule, regulation, judgment, decree, injunction, franchise, permit, certificate, license, authorization or other determination, direction or requirement (including any of the foregoing which relate to environmental standards or controls, energy regulations and occupational safety and health standards or controls) of any (domestic or foreign) arbitrator, court or other Governmental Authority.

“LD Holdings” shall mean LD Holdings Group LLC, a Delaware limited liability company.

“LD Investment Holdings” shall mean LD Investment Holdings, a Delaware corporation.

“Lender” means the Person identified as such in the introductory paragraph hereto, and includes its successors and assigns.
 “Lien” means any lien, mortgage, security interest, tax lien, pledge, charge, hypothecation, assignment, preference, priority, or other encumbrance of any kind or nature whatsoever (including, without limitation, any conditional sale or title retention agreement), whether arising by contract, operation of law, or otherwise, but not including any licenses to use any Intellectual Property granted by Borrower in the Ordinary Course of Business.
“List of Eligible Servicing Rights” means a list in a form acceptable to the Lender, signed by a Responsible Officer and submitted to the Lender from time to time with the Borrowing Request Form listing all Mortgage Loans related to the Pledged Servicing Rights  (Mortgage Loans in pools shall be listed by pool number although the Lender shall have the right to require lists of Mortgage Loans in such pools) and stating the portion of the current Borrowing Base evidenced by such Pledged Servicing Rights.
“Loan” means any Borrowing.
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“Loan Documents” means this Agreement, the Security Documents, the Revolving Credit Note, the Pricing Side Letter and all other promissory notes, security agreements, deeds of trust, assignments, letters of credit, guaranties, and other instruments, documents, or agreements executed and delivered pursuant to or in connection with this Agreement or the Security Documents.
“LTV Ratio” means, at any time, the ratio of (a) the outstanding principal amount of the Revolving Credit Note to (b) the Market Value of all Eligible Servicing Rights as updated for the most recent unpaid principal balance and as most recently determined by a Servicing Appraisal as determined in accordance with the terms and conditions of this Agreement.
“Mandatory Prepayment Event” has the meaning set forth in Section 3.2(b).
“Market Value” means, with respect to any Servicing Rights, as of any Determination Date, the value for such Servicing Rights that is equal to the product of (a) the low end price of such Servicing Rights (stated as a percentage of the unpaid principal balance of the subject Serviced Loans) as determined by the most recent (no less than monthly) appraisal thereof by an Approved Servicing Appraiser and stated in a Servicing Appraisal (provided, however, that if no range of prices for such Servicing Rights is available, then the price shall be the stated fair market value of the Servicing Rights as determined by the Approved Servicing Appraiser) times (b) the aggregate principal balances on the relevant Determination Date of the Servicing Portfolio.  The appraised value shall be determined by an Approved Servicing Appraiser selected by Borrower; provided, however, that if a Default has occurred that has not been cured by Borrower or an Event of Default has occurred that has not been declared in writing by the Lender to have been cured or waived, then (i) Lender, in its sole discretion, may select and approve the Approved Servicing Appraiser that will determine such value and/or (ii) the Lender, using its customary methods, systems and procedures, may in its reasonably discretion determine such value, taking into account customary factors, including current market conditions and the fact that the Servicing Rights may be sold or otherwise disposed of (including termination by settlement agreement with the counterparty to the relevant Servicing Agreement).  The Lender’s determination of Market Value hereunder shall be conclusive and binding upon the parties, absent manifest error.
 “Material Adverse Event” means any act, event, condition, or circumstance which could materially and adversely affect: (a) the operations, business, properties, liabilities (actual or contingent), condition (financial or otherwise) or prospects of Borrower or Borrower and its Subsidiaries, taken as a whole; (b) the ability of Borrower or any Obligated Party to perform its obligations under any Loan Document to which it is a party; or (c) the legality, validity, binding effect or enforceability against Borrower or any Obligated Party of any Loan Document to which it is a party.
“Maximum Commitment” has the meaning set forth in the Pricing Side Letter.
“Maximum Rate” means, at all times, the maximum rate of interest which may be charged, contracted for, taken, received or reserved by Lender in accordance with applicable Texas law (or applicable United States federal law to the extent that such law permits Lender to charge, contract for, receive or reserve a greater amount of interest than under Texas law).  The Maximum Rate shall be calculated in a manner that takes into account any and all fees, payments, and other charges in respect of the Loan Documents that constitute interest under applicable law.  Each change in any interest rate provided for herein based upon the Maximum Rate resulting from a change in the Maximum Rate shall take effect without notice to Borrower at the time of such change in the Maximum Rate.
“MBS” means a mortgage pass-through security, collateralized mortgage obligation, REMIC or other security that (a) is based on and backed by an underlying pool of Mortgage Loans and (b) provides for payment by its issuer to its holder of specified principal installments and/or a fixed or floating rate of interest on the unpaid balance and for prepayments to be passed through to the holder, whether issued in certificated or book-entry form and whether or not issued, guaranteed, insured or bonded by an Agency, an insurance company, a private issuer or any other Person. 
“MERS” means Mortgage Electronic Registration Systems, Inc., or any successor thereto.
“Moody’s” means Moody’s Investors Service, Inc. or any successors thereto. 
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“Mortgage” means a mortgage, deed of trust, deed to secure debt, security deed or other mortgage instrument or similar evidence of lien legally effective in the U.S. jurisdiction where the relevant real property is located to create and constitute a valid and enforceable Lien, subject only to Liens permitted under Section 8.2 hereunder, on the fee simple or long term ground leasehold estate in improved real property.
“Mortgage Loan” means any loan evidenced by a Mortgage Note and includes all right, title and interest of the lender or mortgagee of such loan as a holder of both the beneficial and legal title to such loan, including (a) all loan documents, files and records of the lender or mortgagee for such loan, (b) the monthly payments, any prepayments, insurance and other proceeds, (c) the unseparated rights to service such loan and (d) all other rights, interests, benefits, security, proceeds, remedies and claims in favor or for the benefit of the lender or mortgagee arising out of or in connection with such loan. 
“Mortgage Note” means a promissory note secured by a Mortgage. 
“Mortgaged Premises” means the Property securing a Mortgage Note. 
“Multiemployer Plan” means a multiemployer plan defined as such in Section 3(37) of ERISA to which contributions are being made or have been made by, or for which there is an obligation to make by or there is any liability, contingent or otherwise, with respect to Borrower or any Obligated Party or any ERISA Affiliate and which is covered by Title IV of ERISA.
“Non-Agency Servicing Rights” means all of Borrower’s rights and interests under any Servicing Agreement between Borrower and any Person (other than any Agency), including the rights to (a) service the Serviced Loans that are the subject matter of such Servicing Agreement and (b) be compensated, directly or indirectly, for doing so.
“Obligated Party” means Borrower or any other Person who is or becomes party to any agreement that obligates such Person to pay or perform, or that Guarantees or secures payment or performance of, the Obligations or any part thereof.
 “Obligations” means all obligations, indebtedness, and liabilities of Borrower and any other Obligated Party to Lender or any Affiliate of Lender, or both, now existing or hereafter arising, whether direct, indirect, related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several, or joint and several, including, without limitation, the obligations, indebtedness, and liabilities under this Agreement, the other Loan Documents, any and all guarantees executed by Borrower or any other Obligated Party in favor of Lender for third-party indebtedness, any cash management or treasury services agreements and all interest accruing thereon (whether a claim for post-filing or post-petition interest is allowed in any bankruptcy, insolvency, reorganization or similar proceeding) and all attorneys’ fees and other expenses incurred in the enforcement or collection thereof.
“OFAC” means the U.S. Department of Treasury, Office of Foreign Assets Control.
“Ordinary Course of Business” means the ordinary course of the respective businesses of Borrower and any Obligated Party, consistent with past practice, but excluding any event, action, circumstance or omission that would constitute or give rise to (a) a violation of applicable law, (b) a breach, default or violation of any contract of Borrower or any Obligated Party or (c) a breach of any representation, warranty or covenant of Borrower or any Obligated Party set forth in the Loan Documents.
“Organic Change” means any of the following: (a) any sale, assignment, lease conveyance, exchange, transfer, sale-leaseback or other disposition of substantially all of the assets, business, equity securities or properties of Borrower, whether in one or a series of transactions, other than in the Ordinary Course of Business and whether or not directly or indirectly or through the sale or other disposition of equity securities of any of the other Subsidiaries of Borrower, and (b) any (i) merger, consolidation or other combination to which Borrower or any its Subsidiaries is a party or (ii) liquidation, winding up or dissolution of Borrower or any of its Subsidiaries, other than (1) those not prohibited elsewhere in this Agreement (2) the merger of Borrower with an Affiliate organized solely for the purpose of reorganizing 
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Borrower in another jurisdiction to realize tax or other benefits and (3) those transactions expressly consented to in writing by the Lender.
“Other Connection Taxes” means, with respect to any recipient, Taxes imposed as a result of a present or former connection between such recipient and the jurisdiction imposing such Tax. 
“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, this Agreement.
“Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L. 107-56, signed into law October 26, 2001).
“PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to all or any of its functions under ERISA.
"Permitted Distributions" means (a)Tax Distributions and (b) any I-Unitholder distributions. 

“Person” means any individual, corporation, limited liability company, business trust, association, company, partnership, joint venture, Governmental Authority, or other entity, and shall include such Person’s heirs, administrators, personal representatives, executors, successors and assigns.
“Plan” means any employee benefit or other plan, other than a Multiemployer Plan, established or maintained by, or for which there is an obligation to make contributions by or there is any liability, contingent or otherwise with respect to Borrower or any ERISA Affiliate and which is covered by Title IV of ERISA or subject to Section 412 of the Code.  
“Pledged Servicing Rights” has the meaning set forth in Section 4.1(a).
“Pledged to the Lender” means:
(a) for Servicing Rights, Servicing Rights that satisfy the definition of “Servicing Rights” set forth herein and have been duly pledged by Borrower to the Lender; and have not been released from the Lien hereunder; 
(b) [reserved];
(c) for any investment securities or deposit account, that such investment securities or deposit account have been made subject to a control agreement executed by the relevant securities intermediary or depository and the Lender that gives control of such investment securities or deposit account to the Lender; and
(d) for any other type of property, that Borrower has granted to the Lender a Lien therein and have taken all steps required under applicable Law to perfect such Lien as a first and prior Lien and security interest in all of Borrower’s present and future right, title and interest therein.
“Pricing Side Letter” means that certain Pricing Side Letter dated as of April [__], 2022 entered into by and among Borrower and Lender, as amended, modified, supplemented, or restated from time to time.
“Principal Office” means the principal office of Lender, presently located at 2515 McKinney Avenue, Suite 1100, Dallas, Texas 75201.
“Prohibited Transaction” means any transaction set forth in Section 406 of ERISA or Section 4975 of the Code.
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“Property” of a Person means any and all property, whether real, personal, tangible, intangible or mixed, of such Person, or any other assets owned, operated or leased by such Person, including the Collateral.
“Recourse Servicing Agreement” means a Servicing Agreement with respect to which the servicer is obligated to repurchase or indemnify the holder of the related Mortgage Loans in respect of defaults on such Mortgage Loans at any time during the term of such Mortgage Loans.
“Related Indebtedness” has the meaning set forth in Section 11.20.
“Release” means, as to any Person, any release, spill, emission, leaking, pumping, injection, deposit, disposal, disbursement, leaching, or migration of Hazardous Materials into the indoor or outdoor environment or into or out of property owned by such Person, including, without limitation, the movement of Hazardous Materials through or in the air, soil, surface water, ground water, or Property.
“Remedial Action” means all actions required to (a) clean up, remove, treat, or otherwise address Hazardous Materials in the indoor or outdoor environment, (b) prevent the Release or threat of Release or minimize the further Release of Hazardous Materials so that they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, or (c) perform pre-remedial studies and investigations and post-remedial monitoring and care.
“REO Property” means a Mortgaged Premises acquired by Borrower on behalf of a MBS trust through foreclosure or deed-in-lieu of foreclosure. 
“Reportable Event” means any of the events set forth in Section 4043 of ERISA.
“Responsible Officer” means the chief executive officer, president, chief financial officer, chief capital markets officer, chief accounting officer or treasurer of Borrower or any Person designated by a Responsible Officer to act on behalf of a Responsible Officer; provided that such designated Person may not designate any other Person to be a Responsible Officer.  Any document delivered hereunder that is signed by a Responsible Officer of Borrower shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of Borrower and such Responsible Officer shall be conclusively presumed to have acted on behalf of Borrower.
“Revolving Credit Note” means the Eighteenth Amended and Restated Promissory Note, dated December [__], 2021, made by Borrower payable to the order of Lender, as amended or restated from time to time.
“Secured Parties” means the collective reference to Lender and any other Person the Obligations owing to which are, or are purported to be, secured by the Collateral under the terms of the Security Documents.
“Security Documents” means each and every security agreement, pledge agreement, mortgage, deed of trust or other collateral security agreement required by or delivered to Lender from time to time that purport to create a Lien in favor of any of the Secured Parties to secure payment or performance of the Obligations or any portion thereof.
“Serviced Loans” means all Mortgage Loans serviced or required to be serviced by Borrower under any Servicing Agreement, irrespective of whether the actual servicing is done by another Person (a subservicer) retained by Borrower for that purpose. 
“Servicer” means a Person (which may, or shall, mean Borrower if the context permits, or requires, it) retained by the owner (or a trustee for the owner) of Mortgage Loans to service them under a Servicing Agreement. 
“Servicer Downgrade Event” means, if applicable, a servicer rating for Borrower, a Servicer or any sub-servicer is downgraded one or more levels below SQ3 by Moody’s or RPS3 by Fitch.
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“Servicing Agreement” means, with respect to any Person, the arrangement pursuant to which that Person acts as servicer of Mortgage Loans, whether or not any of such Mortgage Loan is owned by such Person, including each Approved Servicing Agreement and, if applicable, the Agency Guidelines.
“Servicing Appraisal” means a written appraisal or evaluation by an Approved Servicing Appraiser evaluating the fair market value of all of the Pledged Servicing Rights as of a date stated in the written report of such evaluation, each such evaluation and report to be made at Borrower’s expense, to be addressed to the Lender and to be in a form reasonably acceptable to the Lender, it being understood that, for purposes of this Agreement, (i) if the opinion of value in any such independent appraisal or evaluation is expressed as a range of values, then for purposes of this Agreement, the Market Value shall be deemed the low end price of the range (ii) each Servicing Appraisal shall take into account customary factors, including current market conditions and the fact that the Servicing Rights may be terminated by the relevant Servicing Agreement’s counterparty, or sold or otherwise disposed of, under circumstances where Borrower is in default under this Agreement and (iii) each Servicing Appraisal shall include an Interest Rate Sensitivity Analysis. Borrower acknowledges that each Approved Servicing Appraiser’s determination of market value is for the limited purpose of determining an advance rate for purposes of the financing provided in this Agreement 
“Servicing Payment Account” means Borrower’s non-interest bearing demand deposit account to be maintained with Lender and to be used for (a) the Lender’s deposits of proceeds of Loans made by the Lender to Borrower, and payments constituting the sale proceeds of principal from any Collateral (other than regular principal and interest payments on the Collateral); (b) the Borrower’s deposits of principal and interest payments for the repayment of Loans which payments are made by or on account of Borrower and (c) only if and when (i) no Default has occurred unless it has been either cured by Borrower or waived in writing by the Lender and (ii) no Event of Default has occurred unless the Lender has declared in writing that it has been cured or waived, the Lender’s transfer to Borrower’s designated operating account (or to a controlled disbursement account maintained by Borrower with the Lender) of proceeds of sales or other dispositions of released Collateral permitted hereunder. The Servicing Payment Account shall be a blocked and controlled account from which, if a Default or Event of Default has occurred and is continuing, Borrower shall have no right to directly withdraw funds, but instead such funds may be withdrawn or paid out only against the order of an authorized officer of the Lender.
“Servicing Portfolio” means Borrower’s entire portfolio of Serviced Loans.
“Servicing Rights” means, collectively, the Agency Servicing Rights and the Non-Agency Servicing Rights.
“Single-family” is a preface that means that a Mortgage Loan is secured by a Mortgage covering real property improved by a one-, two-, three- or four-family residence. 
“Sponsor” means LD Investment Holdings.
 “Subsidiary” means (a) any corporation of which at least a majority of the outstanding shares of stock having by the terms thereof ordinary voting power to elect a majority of the board of directors of such corporation (irrespective of whether or not at the time stock of any other class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time directly or indirectly owned or controlled by Borrower or one or more of other Subsidiaries or by Borrower and one or more of such Subsidiaries, and (b) any other entity (i) of which at least a majority of the ownership, equity or voting interest is at the time directly or indirectly owned or controlled by one or more of Borrower and other Subsidiaries and (ii) which is treated as a subsidiary in accordance with GAAP.
“Tax Distributions” means distributions by the Borrower for the purpose of enabling LD Holdings to make Tax Distributions, as defined and set forth in the limited liability company agreement of LD Holdings. 
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“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto. 
“Termination Date” means 11:00 A.M. Dallas, Texas time on June 30, 2021, such later date as shall be established pursuant to Section 2.5 or such earlier date on which the Commitment terminates as provided in this Agreement.
 “UCC” means Chapters 1 through 11 of the Texas Business and Commerce Code.
“Unfunded Pension Liability” means the excess, if any, of (a) the funding target as defined under Section 430(d) of the Code without regard to the special at-risk rules of Section 430(i) of the Code, over (b) the value of plan assets as defined under Section 430(g)(3)(A) of the Code determined as of the last day of each calendar year, without regard to the averaging which may be allowed under Section 310(g)(3)(B) of the Code and reduced for any prefunding balance or funding standard carryover balance as defined and provided for in Section 430(f) of the Code.
Section 1.2Accounting Matters.
  Any accounting term used in this Agreement or any other Loan Document shall have, unless otherwise specifically provided therein, the meaning customarily given such term in accordance with GAAP, and all financial computations thereunder shall be computed, unless otherwise specifically provided therein, with respect to Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied; provided, however, that all financial covenants and calculations in the Loan Documents shall be made in accordance with GAAP as in effect on the date of this Agreement unless Borrower and Lender shall otherwise specifically agree in writing.  That certain items or computations are explicitly modified by the phrase “in accordance with GAAP” shall in no way be construed to limit the foregoing
Section 1.3ERISA Matters.
  If, after the date hereof, there shall occur, with respect to ERISA, the adoption of any applicable law, rule, or regulation, or any change therein, or any change in the interpretation or administration thereof by the PBGC or any other Governmental Authority, then Borrower or Lender may request a modification to this Agreement solely to preserve the original intent of this Agreement with respect to the provisions hereof applicable to ERISA, and the parties to this Agreement shall negotiate in good faith to complete such modification.  
Section 1.4Other Definitional Provisions. 
  All definitions contained in this Agreement are equally applicable to the singular and plural forms of the terms defined.  The words “hereof”, “herein”, and “hereunder” and words of similar import referring to this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement.  Unless otherwise specified, all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear.  Terms used herein that are defined in the UCC, unless otherwise defined herein, shall have the meanings specified in the UCC.  Any definition of or reference to any agreement, instrument or other document shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document).  Any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time. Unilateral revisions by an Agency to its Agency Guidelines, its seller or servicing guide or its other publications or rules shall not constitute an “amendment” of a Servicing Agreement for purposes of this Agreement. 
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SECTION 2Borrowings
Section 2.1Borrowings.
(a)Borrowings.  Subject to the terms and conditions of this Agreement, Lender agrees to make one or more revolving credit loans to Borrower from time to time from the date hereof to and including the Termination Date in an aggregate principal amount at any time outstanding up to but not exceeding the amount of the Commitment, provided that the aggregate amount of all Borrowings at any time outstanding shall not exceed the lesser of (i) the amount of the Commitment and (ii) the Borrowing Base. Subject to the foregoing limitations, and the other terms and provisions of this Agreement, Borrower may borrow, repay, and reborrow hereunder. No Loan shall be funded or held with “plan assets” within the meaning of Section 3(42) of ERISA. 
(i)The Revolving Credit Note.  The obligation of Borrower to repay the Borrowings and interest thereon shall be evidenced by the Revolving Credit Note executed by Borrower, and payable to the order of Lender, in the principal amount of the Commitment as originally in effect.
(ii)Repayment of Borrowings.  Borrower shall repay the unpaid principal amount of all Borrowings on (A) in the case of Loans that are not converted to a term loan pursuant to Section 2.07, the Termination Date, and (B) in the case of Loans that are converted to a term loan pursuant to Section 2.07, on the Term Loan Maturity Date, in each case unless sooner due by reason of acceleration by Lender as provided in this Agreement.
(iii)Interest.  The unpaid principal amount of the Borrowings shall, subject to the following sentence, bear interest as provided in the Revolving Credit Note.  If at any time the rate of interest specified in the Revolving Credit Note would exceed the Maximum Rate but for the provisions thereof limiting interest to the Maximum Rate, then any subsequent reduction shall not reduce the rate of interest on the Borrowings below the Maximum Rate until the aggregate amount of interest accrued on the Borrowings equals the aggregate amount of interest which would have accrued on the Borrowings if the interest rate had not been limited by the Maximum Rate.  Accrued and unpaid interest on the Borrowings shall be payable as provided in the Revolving Credit Note and on the Termination Date. 
(iv)Borrowing Procedure.  Borrower shall give Lender notice of each Borrowing by means of a Borrowing Request Form containing the information required therein and delivered (by hand or by mechanically confirmed facsimile) to Lender no later than 1:00 p.m. (Dallas, Texas time) on the day on which the Borrowing is desired to be funded. Lender at its option may accept telephonic requests for such Borrowings, provided that such acceptance shall not constitute a waiver of Lender’s right to require delivery of a Borrowing Request Form in connection with subsequent Borrowings.  Any telephonic request for a Borrowing by Borrower shall be promptly confirmed by submission of a properly completed Borrowing Request Form to Lender, but failure to deliver a Borrowing Request Form shall not be a defense to payment of the Borrowing.  Lender shall have no liability to Borrower for any loss or damage suffered by Borrower as a result of Lender’s honoring of any requests, execution of any instructions, authorizations or agreements or reliance on any reports communicated to it telephonically, by facsimile or electronically and purporting to have been sent to Lender by Borrower and Lender shall have no duty to verify the origin of any such communication or the identity or authority of the Person sending it.  Subject to the terms and conditions of this Agreement, each Borrowing shall be made available to Borrower by depositing the same, in immediately available funds, in an account of Borrower designated by Borrower maintained with Lender at the Principal Office. If, after giving effect to a requested Borrowing, there is a Borrowing Base Deficiency, or if the Lender determines (either then or on any later day in the course of reviewing the same) that the Borrowing Request Form submitted to it is incomplete or incorrect in any material respect, then the Lender 
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shall withhold the entire Borrowing until Borrower shall have demonstrated to the Lender’s reasonable satisfaction that such Borrowing Request Form is in fact not (or is no longer) incomplete or incorrect in any material respect.
Section 2.2General Provisions Regarding Interest; Etc.
(a)Default Interest Rate.  Any outstanding principal of any Borrowing and (to the fullest extent permitted by law) any other amount payable by Borrower under this Agreement or any other Loan Document that is not paid in full when due (whether at stated maturity, by acceleration, or otherwise) shall bear interest at the Default Interest Rate for the period from and including the due date thereof to but excluding the date the same is paid in full.  Additionally, at any time that an Event of Default exists, all outstanding and unpaid principal amounts of all of the Obligations shall, to the extent permitted by law, bear interest at the Default Interest Rate.  Interest payable at the Default Interest Rate shall be payable from time to time on demand.
(b)Computation of Interest.  Interest on the Borrowings and all other amounts payable by Borrower hereunder shall be computed on the basis of a year of 360 days and the actual number of days elapsed (including the first day but excluding the last day) unless such calculation would result in a usurious rate, in which case interest shall be calculated on the basis of a year of 365 or 366 days, as the case may be.
Section 2.3Reserved.
Section 2.4Use of Proceeds.
  The proceeds of the Borrowings shall be used by Borrower for (a) acquiring mortgage servicing rights and assets related thereto and (b) other working capital needs and general corporate purposes of the Borrower.
Section 2.5Extension of Termination Date. So long as no Event of Default shall have occurred and be continuing on the date on which notice is given to Lender at least thirty (30) days, but no more than sixty (60) days, prior to the Termination Date then in effect, Borrower may extend the Termination Date to a date that is three hundred and sixty-four (364) days after the then-effective Termination Date, no more than two times, upon delivery by Borrower to Lender of: (a) a written request therefor; and (b) a certificate of Borrower dated the date of such request stating that (i) no Default or Event of Default then exists and is continuing and (ii) Borrower is in compliance with the financial covenants set forth in Section 2 of the Pricing Side Letter. Such extension shall be evidenced by delivery of written confirmation of the same by Lender to Borrower.
Section 2.6Increase in the Maximum Commitment.  
(a)Lender may, in its sole discretion, at the request of Borrower, increase the Commitment to the amount requested by the Borrower by increasing its Commitment, subject to the following conditions and Section 1(a)i)(1)(b):
(i)Borrower has delivered to Lender the Facility Increase Request no less than 10 Business Days prior to the date of the proposed increase;
(ii)The Borrower has executed a replacement Note payable to the order of Lender in the outstanding principal amount of the increased Commitment;
(iii)After giving effect to the increase in the Commitment, the Maximum Commitment will not exceed the Maximum Commitment as set forth in the Pricing Side Letter;
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(iv)No Event of Default or Default has occurred and is continuing or would result from such increase in the Commitment;
(v)No Material Adverse Event has occurred;
(vi)Borrower is in compliance with the financial covenants set forth in Section 2 of the Pricing Side Letter;
(vii)As of the date of such increase, the representations and warranties contained in Section 6 and in each other Loan Document are true and correct in all material respects, with the same force and effect as if made on and as of such date; except to the extent that such representations and warranties specifically refer to any earlier date, in which case they were true and correct as of such earlier date and except that for the purposes of this Section 2.6, the representations and warranties contained in Section 6.2 will be deemed, as of the date of such increase, to refer to the then-most recent financial statements furnished pursuant to clauses (a) and (b), respectively, of Section 7.1;
(viii)Lender has received written consent from Freddie Mac, consenting to the increase to the Commitment; and
(ix)Lender has provided Borrower with Lender’s written consent to such increase.
(b)Notwithstanding anything to the contrary set forth herein, any increase in the Commitment is subject in all respects to Lender’s prior written consent.
(c)If Lender deems it advisable in its sole discretion, Borrower and Lender agree to execute an amendment to this Agreement, in form and substance acceptable to Lender, to document an increase in the Commitment pursuant to this Section 2.6.
SECTION 3Payments
Section 3.1Method of Payment.
  Subject to Section 3.3, all payments of principal, interest, and other amounts to be made by Borrower under this Agreement and the other Loan Documents shall be made to Lender at the Principal Office in Dollars and immediately available funds, without setoff, deduction, or counterclaim, and free and clear of all taxes at the time and in the manner provided in the Revolving Credit Note.
Section 3.2Prepayments.  
(a)Voluntary Prepayments.  Borrower may prepay all or any portion of the Revolving Credit Note to the extent and in the manner provided for therein.
(b)Mandatory Prepayment.  If on any date of valuation, the LTV Ratio is greater than the Aggregate Advance Rate (a “Borrowing Base Deficiency”), then Borrower shall immediately prepay the outstanding principal amount of the Revolving Credit Note in an amount equal to the aggregate amount necessary to eliminate such Borrowing Base Deficiency. Without limiting the foregoing, if at any time any of the following events occurs (each such event, a “Mandatory Prepayment Event”), then, at the option of the Lender, Borrower shall make a mandatory prepayment of the Loan in whole or in part prior to or simultaneously with such Mandatory Prepayment Event: (i) the consummation of an Organic Change; or (ii) the occurrence of a Change of Control. Borrower shall give written notice to Lender of any Mandatory Prepayment Event not less than fifteen (15) nor more than sixty (60) days prior to the proposed closing date thereof, describing in reasonable detail such transaction and the proposed closing date. Upon receipt of such notice, Lender shall have a period of fifteen (15) days in which to notify Borrower of the principal amount of the Loan or portion thereof to be prepaid. Upon receipt of such notice 
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from Lender, Borrower covenants and agrees that it shall prepay, on the closing date of such transaction, the Loan or a portion thereof subject to prepayment.
Section 3.3Taxes
(a)Any and all payments by or on account of any obligation of the Borrower under any this Agreement shall be made without deduction or withholding for any Taxes, except as required by applicable law.  If any applicable law (as determined in the good faith discretion of an applicable withholding agent) requires the deduction or withholding of any Tax from any such payment by a withholding agent, then the applicable withholding agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the Borrower shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.
(b)If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.3 (including by the payment of additional amounts pursuant to this Section 3.3), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund).  Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (b) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority.  This paragraph shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.
(c)
(i)Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under this Agreement shall deliver to the Borrower, at the time or times reasonably requested by the Borrower, such properly completed and executed documentation reasonably requested by the Borrower as will permit such payments to be made without withholding or at a reduced rate of withholding.  In addition, any Lender, if reasonably requested by the Borrower, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower as will enable the Borrower to determine whether or not such Lender is subject to backup withholding or information reporting requirements.  Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.3(c)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.
(ii)Without limiting the generality of the foregoing, 
(1)any Lender that is a Person that is a “United States Person,” as defined in Section 7701(a)(30) of the Code (a “U.S. Person”), shall deliver to the Borrower on or prior to the date on which such Lender becomes a Lender under this Agreement (and 
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from time to time thereafter upon the reasonable request of the Borrower), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;
(2)any Lender that is not a U.S. Person shall, to the extent it is legally entitled to do so, deliver to the Borrower (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower, whichever of the following is applicable: 
(A) in the case of a Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under this Agreement, executed originals of IRS Form W-8BEN or W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under this Agreement, IRS Form W-8BEN or W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;
(B) executed originals of IRS Form W-8ECI;
(C) in the case of a Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit D-1 to the effect that such Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN or W-8BEN-E; or
(D) to the extent a Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit D-2 or Exhibit D-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Lender is a partnership and one or more direct or indirect partners of such Lender are claiming the portfolio interest exemption, such Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit D-4 on behalf of each such direct and indirect partner;
(3)if a payment made to a Lender under this Agreement would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower at the time 
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or times prescribed by law and at such time or times reasonably requested by the Borrower such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower as may be necessary for the Borrower to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.  Solely for purposes of this clause (C), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower in writing of its legal inability to do so.

SECTION 4Security
Section 4.1Grant of Security Interest.
  As security for the payment of the Borrowings and for the payment and performance of all of the Obligations, Borrower hereby grants to the Lender a first priority security interest, subject to the terms and conditions of the Acknowledgment Agreement, in all of Borrower’s present and future estate, right, title and interest in and to the following (collectively, the “Collateral”) (although Lender does not assume any of Borrower’s or any other liability or obligation under or in respect of any Collateral and such Collateral shall not include Excluded Collateral):
(a)Servicing Rights.  “(x) All Agency Servicing Rights (whether classified as instruments, accounts, payment intangibles or general intangibles under the UCC) identified by the Seller/Servicer Numbers  171441 and 156827 and (y) all Non-Agency Servicing Rights (whether classified as instruments, accounts, payment intangibles or general intangibles under the UCC), including those listed on any List of Eligible Servicing Rights or similar list or schedule delivered by Borrower to the Lender from time to time and including those listed on Schedule 4.1(a)(2) hereto or on any update to Schedule 4.1(a)(2) from time to time submitted to the Lender by Borrower (collectively, the “Pledged Servicing Rights”), together with:
(i)all late charges, fees and other servicing compensation under, for or in respect of the Pledged Servicing Rights, whether or not yet accrued, earned, due or payable;
(ii)all of Borrower’s rights to proceeds of any sale or other disposition of Pledged Servicing Rights and to any payment in respect of the transfer or termination of Pledged Servicing Rights by the counterparty to the relevant Servicing Agreement;
(iii)all other present and future rights and interests of Borrower in, to, and under the Pledged Servicing Rights;
(iv)all insurance and claims for insurance effected or held for the benefit of Borrower or the Lender in respect of the Pledged Servicing Rights;
(v)all of the files, certificates, correspondence, appraisals, accounting entries, journals and reports, other information and data owned by Borrower that describe, catalog or list such information or data, or that otherwise directly relate to the Pledged Servicing Rights, and other information and data that is used or useful for managing and administering the Pledged Servicing Rights;
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(vi)all media (tapes, discs, cards, drives, flash memory or any other kind of physical or virtual data or information storage media or systems) owned by Borrower on which is stored only information or data that relates to the Pledged Servicing Rights, and on which no other material information and data that relates to property other than the Pledged Servicing Rights is stored;
(vii)Reserved;
(viii)all distributions on the Pledged Servicing Rights or products and proceeds of the Pledged Servicing Rights, all accounts, payment intangibles and general intangibles arising from, under or in respect of the Pledged Servicing Rights or relating thereto, and all accessions or additions to and all substitutions for any of the Pledged Servicing Rights;
(ix)all instruments, documents, or writings evidencing any monetary obligation, account, payment intangible, general intangible or security interest in any of the Pledged Servicing Rights, whether now existing or hereafter arising, accruing or acquired; and
(x)all security for or claims against others in respect of the Pledged Servicing Rights;
(b)Reserved;
(c)Servicing Payment Account.  The Servicing Payment Account and all sums from time to time on deposit in it (excluding the Minimum Servicing Compensation (as defined in the Acknowledgment Agreement));
(d)Reserved;
(e)Other Property.  Any other Property acceptable to the Lender and Pledged to the Lender; and
(f)Other Rights.  All rights to have and receive any of the Collateral described above, all accessions or additions to and substitutions for any of such Collateral, together with all renewals and replacements of any of such Collateral, all other rights and interests now owned or hereafter acquired by Borrower in, under or relating to any of such Collateral or referred to above and all proceeds of any of such Collateral; all of Borrower’s present and future accounts, payment intangibles and general intangibles arising from or relating to the Servicing Payment Account or any such other Property as may be specifically Pledged to the Lender in writing by Borrower and acceptable to the Lender; any instruments, documents or writings evidencing any monetary obligation, contract right, account or security interest in any of such property or its proceeds accruing or accrued and all other rights and interests in and to any and all security for or claims against others in respect of any of the property described or referred to above in this Section 4.1; all books, records, contract rights, instruments, documents (including all documents of title), chattel paper and proceeds relating to, arising from or by virtue of or collections with respect to, or comprising part of, any of such property, including all insurance and claims for insurance effected or held for the benefit of Borrower or the Lender respect of any of the foregoing, in each case whether now existing or hereafter arising, accruing or accrued; and all other rights and interests in and to any and all security for or claims against others in respect of any of the rights, interests and property described or referred to above;
provided, however, that the Collateral shall not include: (i) any lease, license, sublicense, permission, contract, covenant, or agreement or any property subject to any of them to the extent that a grant of a security interest therein would violate or invalidate such lease, license, sublicense, permission, contract, covenant, or agreement or would create a right of termination in favor of any other party thereto or would otherwise require consent thereunder; or (ii) any intent-to-use trademark application prior to the filing of a “Statement of Use” with the U.S. Patent and 
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Trademark Office and acceptance of such “Statement of Use” by the U.S. Patent and Trademark Office.
Section 4.2Limited Pledge of Servicing.  Notwithstanding anything to the contrary in this Agreement or any of the other Loan Documents, the pledge of Borrower’s right, title and interest in mortgage servicing rights under Approved Servicing Agreements with a Designated Agency shall only secure Borrower’s debt to the Lender incurred under a facility used in whole or in part for the purposes of, or to refinance a facility used in whole or in part for the purposes of, purchasing Mortgage Loan servicing rights; provided, that the foregoing provisions of this paragraph shall be deemed automatically supplemented or amended if and to the extent such Designated Agency supplements or amends the corresponding requirement, whether in its rules, regulations, guides, Servicing Agreements, Acknowledgment Agreements, or published announcements or otherwise waives or grants exceptions from such requirement, and in each instance, with the same substantive force and effect; and provided further that the security interest created hereby with respect to the Agency Servicing Rights is subject to the following provision to be included in each financing statement filed in respect hereof:
Notice with respect to Freddie Mac Mortgage Loans:
Notwithstanding anything to the contrary herein, the security interest publicized or perfected by this financing statement is subject and subordinate in each and every respect (a) to all rights, powers and prerogatives of the Federal Home Loan Mortgage Corporation (“Freddie Mac”) under and in connection with the Purchase Documents, as that term is defined in the Freddie Mac Single-Family Seller/Servicer Guide, which rights include, without limitation, the right of Freddie Mac to disqualify (in whole or in part) the debtor named herein as an approved Freddie Mac Seller/Servicer, with or without cause, and the right to terminate (in whole or in part) the unitary, indivisible master servicing contract and to transfer and sell all or any portion of said servicing contract rights, as provided in the Purchase Documents; and (b) to all claims of Freddie Mac arising out of or relating to any and all breaches, defaults and outstanding obligations of the debtor to Freddie Mac.
Section 4.3Acknowledgment Agreements.  Notwithstanding anything to the contrary in this Agreement or any of the other Loan Documents, all terms and provisions of this Agreement and the other Loan Documents are and shall be subject to the terms and provisions of each Acknowledgement Agreement. To the extent that any conflict necessarily exists or shall be adjudged to exist between the terms and provisions of this Agreement and those of an applicable Acknowledgment Agreement, solely with respect to the relationship and agreements between Borrower, Lender and a Designated Agency, the terms and provisions of such Acknowledgment Agreement shall govern and control. 
Section 4.4Lender Requires Acknowledgment Agreements and Consent Agreements.  Pledged Servicing Rights under Servicing Agreements with any Agency will have a Market Value of zero for purposes of determining Collateral Value (a) upon the earlier of (i) the termination or (ii) expiration of the Acknowledgment Agreement covering such Pledged Servicing Rights and (b) until a replacement Acknowledgment Agreement covering such Pledged Servicing Rights has been executed and delivered by the Borrower the Lender and an Agency.
Section 4.5Further Assurances Concerning Collateral. In furtherance of the foregoing, Borrower hereby agrees to perform, or cause to be performed, such acts and duly to authorize, execute, acknowledge, deliver, file and record (or cause such actions to be taken with respect to) such financing statements, assignments, security agreements, deeds of trust, mortgages, bond powers and supplements, modifications or amendments to any of them, and such other papers as the Lender may reasonably request in order to establish and preserve the priority of, perfect and protect the Liens granted or intended to be granted to the Lender in and 
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to any and all such Collateral and to preserve and protect the Lender’s rights in respect of all present and future Collateral for the Obligations.
Section 4.6Financing Statements Filing Authorization. Borrower hereby irrevocably authorizes the Lender, at any time and from time to time, to file at Borrower’s cost and expense in any filing office in any jurisdiction any initial financing statements and continuations thereof and amendments thereto, including amendments to update the lists of Pledged Servicing Agreements attached as exhibits to such financing statements whenever such lists are updated, that (a) indicate the Servicing Collateral, regardless of whether any particular asset in the Servicing Collateral falls within the scope of Article 9 of the UCC, and (b) provide any other information required for the sufficiency or filing office acceptance of any financing statement or amendment. Borrower agrees to furnish any such information to the Lender promptly upon the Lender’s request.
Section 4.7Borrower Remains Liable. Notwithstanding anything contained in this Agreement to the contrary, Borrower expressly agrees that it shall (a) remain liable under each of the Pledged Servicing Agreements and related agreements included in the Servicing Collateral to keep, observe and perform all of the conditions and obligations to be kept, observed and performed by Borrower (or any predecessor in interest) thereunder and (b) perform all of its duties and obligations thereunder, all in accordance with and pursuant to the terms and provisions of each such agreement. The Lender shall not have any obligation or liability under any such agreement by reason of, or arising out of, this Agreement or the granting to the Lender of a Lien therein or the receipt by the Lender of any payment relating to any such agreement.
Section 4.8Rights after Occurrence of Default. After the occurrence of any Event of Default that the Lender has not declared in writing to have been cured or waived, the Lender shall have the following rights (but no obligations):
(a)in its discretion, to demand, sue for, collect or receive and receipt for (in its own name, in the name of Borrower or otherwise) any money or property at any time payable or receivable on account of any of the Collateral, in consideration of its transfer or in exchange for it;
(b)to direct, and to take any and all other steps necessary to cause, any Servicer of any of the Collateral to pay over directly to the Lender for the account of Borrower (instead of to Borrower or any other Person) all sums from time to time due to Borrower and to take any and all other actions that Borrower or the Lender has the right to take under Borrower’s contract with such Servicer; 
(c)to request that Borrower forthwith pay to the Lender at its Principal Office all amounts thereafter received by Borrower upon or in respect of any of the Collateral, advising the Lender as to the sources of such funds, and if the Lender does so request, then Borrower shall diligently and continuously thereafter comply with such request.
(d)All amounts so received and collected by the Lender shall be paid or applied to pay (i) fees owing under the Loan Documents, (ii) the reasonable costs and expenses incurred by the Lender in collecting or enforcing the Revolving Credit Note and the other Loan Documents, defending against any claims made in respect of the Loan Documents or any related transactions, protecting or realizing on Collateral and (iii) accrued and unpaid interest on and principal of the Revolving Credit Note; and
(e)Borrower hereby grants to the Lender a non-exclusive license to use Borrower’s operating systems to manage and administer the Pledged Servicing Rights and any of the data and information relating thereto, together with the media that is owned by Borrower and on which the same are stored to the extent stored with material information or data that relates to property other than the Pledged Servicing Rights (tapes, discs, cards, drives, flash memory or any other kind of physical or virtual data or information storage 
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media or systems, and Borrower’s rights to access the same, whether exclusive or nonexclusive, to the extent that such access rights may lawfully be transferred or used by Borrower’s permittees), and any computer programs that are owned by Borrower (or licensed to Borrower under licenses that may lawfully be transferred or used by Borrower’s permittees) and that are used to access, organize, input, read, print or otherwise output and otherwise handle or use such information and data, in each case effective solely upon the occurrence and during the continuance of any Event of Default, to the extent necessary to enable Lender to realize on the Collateral and any permitted successor or assign to enjoy the benefits of the Collateral.  Such license is granted free of charge, without requirement that any monetary payment whatsoever including, without limitation, any royalty or license fee, be made to Borrower or any other Person by Lender or any other Person. Such license shall automatically terminate upon (i) the termination of this Agreement or (ii) payment in full of all Obligations and the termination of the Revolving Credit Note;
provided, however, that any and all rights and remedies of the Lender in this Agreement are expressly subject and subordinate to the prior rights of a Designated Agency as to Collateral subject to an Acknowledgment Agreement with such Designated Agency, and in the event the enforcement by the Lender of any of its rights and remedies under this Article 4 or Article 10 could reasonably be expected to materially and adversely conflict with the provisions of an applicable Acknowledgment Agreement with respect to the Collateral subject to the Acknowledgment Agreement, the restrictions imposed under the Acknowledgment Agreement shall control.
Section 4.9Attorney-In-Fact Appointment. Borrower hereby appoints the Lender as its attorney-in-fact to take all such steps in its name and behalf as are necessary or appropriate to (i) request that any Pledged Servicing Right related to any Agency or any other investor be transferred to the Lender or to another approved servicer approved such Agency or such other investor (as the case may be) and perform (without assuming or being deemed to have assumed any of the obligations of Borrower thereunder) all aspects of each servicing contract that is Collateral, (ii) request distribution to the Lender of sale proceeds or any applicable contract termination fees arising from the sale or termination of such servicing rights and remaining after satisfaction of Borrower’s relevant obligations to such Agency or such other investor (as the case may be), including costs and expenses related to any such sale or transfer of such servicing rights and other amounts due for unmet obligations of Borrower to such Agency or such other investor (as the case may be) under applicable Agency Guideline or such other investor’s contract, (iii) deal with investors and any and all subservicers and master servicers in respect of any of the Collateral in the same manner and with the same effect as if done by Borrower and (iv) take any action and execute any instruments that the Lender deems necessary or advisable to accomplish any of such purposes, and such appointment shall be deemed a power coupled with an interest and shall be irrevocable for so long as any of the Obligations shall be unpaid or Lender shall have any outstanding commitment to lend or to extend any other financial accommodations to or for the account of Borrower. Such appointment shall be effective, automatically and without the necessity of any action (including any transfer of any Collateral on the record books of the issuer thereof) by any Person (including the issuer of such Collateral or any officer or agent thereof), upon the occurrence and during the continuance of an Event of Default. 
Section 4.10Periodic Valuations of Servicing Rights. The value of all Pledged Servicing Rights to the Lender shall be periodically determined as provided in Section 7.14 by an Approved Servicing Appraiser and the Borrowing Base shall be adjusted to reflect each such determination and updating of the value of such Collateral; provided that, notwithstanding any other provision hereof to the contrary, the Lender shall have the right, exercisable from time to time (daily or less often) in its sole discretion on any day after the occurrence and during the continuance of any Event of Default to mark the Pledged Servicing Rights to market, whereupon, for purposes of determining the Collateral Value for that day (and for each day thereafter until it shall thereafter be evaluated or re-evaluated by such an approved appraiser or broker or again marked to market by the Lender) such Pledged Servicing Rights shall be equal to 50.0% of its Market Value on that day (which the parties acknowledge may be nominal).  Borrower acknowledges that a determination by the Lender of Market Value pursuant to this 
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Agreement is for the limited purpose of determining Collateral Value for lending purposes under this Agreement without the ability to perform customary purchaser’s due diligence and is not necessarily equivalent to a determination of the fair market value of Collateral achieved by obtaining competing bids in an orderly market in which the servicer is not in default, insolvent or the subject of a case in bankruptcy and the bidders have adequate opportunity to perform customary diligence.
Section 4.11Collections in General. After the occurrence of any Event of Default that the Lender has not declared in writing to have been cured or waived, the Lender shall have the right (but no obligation) in its sole discretion to take any or all of the following actions with respect to the Collateral, which rights are in addition to, and not in derogation or in lieu of, any other rights available to a secured creditor under any applicable law, rule, or regulation or any order, writ, injunction, or decree of any Governmental Authority or arbitrator:
(a)Demand, sue for, collect or receive and receipt for (in its own name, in the name of Borrower or otherwise) any money or property at any time payable or receivable on account of any of the Collateral, in consideration of its transfer or in exchange for it;
(b)Request Borrower to pay over to the Lender all sums from time to time due Borrower under or in respect of the Approved Servicing Agreements (excluding the Minimum Servicing Compensation (as defined in the Acknowledgment Agreement)), including any and all fees and other compensation under the Approved Servicing Agreements for servicing the Serviced Loans, and to take any and all other actions that, subject to any restrictions imposed by the relevant Approved Servicing Agreement for the benefit of the party to it on whose behalf the Serviced Loans are being serviced (to the extent that such restrictions are valid and enforceable under the applicable UCC and other Laws), Borrower or the Lender has the right to take under that Servicing Agreement, and if the Lender does so request, then Borrower shall diligently and continuously thereafter comply with such request; and
(c)Request that Borrower forthwith pay to the Lender at its principal office all amounts thereafter received by Borrower upon or in respect of any of the Collateral, whether paid to Borrower or withheld or recovered by Borrower from collections and realizations on the Serviced Loans or any other source, advising the Lender as to the source of such funds, and if the Lender does so request, then Borrower shall diligently and continuously thereafter comply with such request.
All amounts so received and collected by the Lender pursuant to this Section 4.11 shall be applied in the same order and manner as is specified in Section 10.3. 
Section 4.12Setoff.   Subject to the Agency’s Interest or the owner of any related Mortgage Loan in the case of Non-Agency Servicing Rights, if an Event of Default exists, Lender shall have the right to set off and apply against the Obligations in such manner as Lender may determine, at any time and without notice to Borrower or any Obligated Party, any and all deposits (general or special, time or demand, provisional or final) or other sums at any time credited by or owing from Lender to Borrower or any Obligated Party whether or not the Obligations are then due.  As further security for the Obligations, Borrower and each Obligated Party hereby grant to Lender a security interest in all money, instruments, and other Property of Borrower and each Obligated Party now or hereafter held by Lender, but expressly excluding Property held in escrow on behalf of Customers or in safekeeping for delivery to an Agency or the owner, as applicable.  In addition to Lender’s right of setoff and as further security for the Obligations, Borrower and each Obligated Party hereby grant to Lender a security interest in all deposits (general or special, time or demand, provisional or final) and other accounts of Borrower or any Obligated Party now or hereafter on deposit with or held by Lender and all other sums at any time credited by or owing from Lender to Borrower or any Obligated Party.  The rights and remedies of Lender hereunder are in addition to other rights and remedies (including, without limitation, other rights of setoff) which Lender may have. 
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Section 4.13Schedules 4.1(a)(2). For the avoidance of doubt, Borrower shall list Agency Servicing Rights that are Pledged to Lender on Schedule 4.1(a)(2). Borrower shall, along with each Borrowing Base Report, deliver to Lender any updates to Schedule 4.1(a)(2). 
SECTION 5Conditions Precedent
Section 5.1Initial Extension of Credit.
  The obligation of Lender to make the initial Borrowing under the Revolving Credit Note is subject to the condition precedent that Lender shall have received on or before the day of such Borrowing all of the following, each dated (unless otherwise indicated) the date hereof, in form and substance satisfactory to Lender:
(a)Resolutions.  Resolutions of the Board of Directors (or other governing body) of Borrower and each other Obligated Party certified by the Secretary or an Assistant Secretary (or other custodian of records) of such Person which authorize the execution, delivery, and performance by such Person of this Agreement and the other Loan Documents to which such Person is or is to be a party;
(b)Incumbency Certificate.  A certificate of incumbency certified by a Responsible Officer certifying the names of the individuals or other Persons authorized to sign this Agreement and each of the other Loan Documents to which Borrower and each other Obligated Party is or is to be a party (including the certificates contemplated herein) on behalf of such Person together with specimen signatures of such individual Persons;
(c)Constituent Documents.  The Constituent Documents for Borrower and each other Obligated Party certified as of a date acceptable to Lender by the appropriate government officials of the state of formation of Borrower and each other Obligated Party;
(d)Governmental Certificates.  Certificates of the appropriate government officials of the state of formation or organization of Borrower and each other Obligated Party as to the existence and good standing of Borrower and each other Obligated Party, each dated within ten (10) days prior to the date of the initial Borrowing;
(e)Revolving Credit Note.  The Revolving Credit Note executed by Borrower;
(f)Security Documents.  The Security Documents executed by Borrower and other Obligated Parties;
(g)Financing Statements.  UCC financing statements reflecting Borrower and the other Obligated Parties, as debtors, and Lender, as secured party, which are required to grant a Lien which secures the Obligations and covering such Collateral as Lender may request;
(h)Agency Approval. Written approval from Freddie Mac approving the Pledge to the Lender of the Collateral hereunder;
(i)Insurance Matters.  Copies of insurance certificates describing all insurance policies required by Section 7.5;
(j)Lien Searches.  The results of UCC, tax lien and judgment lien searches showing all financing statements and other documents or instruments on file against Borrower and each other Obligated Party in the appropriate filing offices, such search to be as of a date no more than ten (10) days prior to the date of the initial Borrowing;
(k)Opinion of Counsel. Favorable opinions of each of Kirkland & Ellis LLP, outside legal counsel to Borrower (dated as of the Closing Date), and of Peter Macdonald, Esq., General Counsel of Borrower, as to such matters as Lender may reasonably request; 
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(l)Attorneys’ Fees and Expenses.  Evidence that the costs and expenses (including reasonable attorneys’ fees) referred to in Section 11.1, to the extent incurred, shall have been paid in full by Borrower; 
(m)Closing Fees.  Evidence that the any fees due at closing have been paid; 
(n)Reserved.  
(o)Reserved.
(p)Borrowing Base Report. A Borrowing Base Report executed by Borrower; 
(q)Acknowledgement Agreement. With respect to each Designated Agency, an Acknowledgment Agreement executed by Borrower and such Designated Agency, as applicable, in a form satisfactory to Lender; and
(r)Additional Items.  The additional items set forth on Schedule 5.1(r). 
Section 5.2All Extensions of Credit.
  The obligation of Lender to make any Borrowing (including the initial Borrowing) is subject to the following additional conditions precedent:
(a)Request for Borrowing.  Lender shall have received in accordance with this Agreement, as the case may be, a Borrowing Request Form pursuant to Lender’s requirements and executed by a Responsible Officer of Borrower;
(b)No Default or Event of Default.  No Default or Event of Default shall have occurred and be continuing, or would result from or after giving effect to such Borrowing;
(c)No Material Adverse Event.  No Material Adverse Event has occurred and no circumstance exists that could be a Material Adverse Event;
(d)Representations and Warranties.  All of the representations and warranties contained in Section 6 and in the other Loan Documents shall be true and correct on and as of the date of such Borrowing with the same force and effect as if such representations and warranties had been made on and as of such date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date; and
(e)Additional Documentation.  Lender shall have received such additional approvals, opinions, or documents as Lender or its legal counsel may reasonably request.
Each Borrowing hereunder shall be deemed to be a representation and warranty by Borrower and each other Obligated Party that the conditions specified in this Section 5.2 have been satisfied on and as of the date of the applicable Borrowing.
SECTION 6Representations and Warranties
To induce Lender to enter into this Agreement, and to make Borrowings hereunder, and except as set forth in this Agreement and on the Schedules hereto, Borrower represents and warrants to Lender that:
Section 6.1Entity Existence.
  Borrower and each Obligated Party (a) is duly formation, validly existing, and in good standing under the laws of the jurisdiction of its formation or organization; (b) has all requisite power and authority to own its assets and carry on its business as now being or as proposed to be conducted; and (c) is 
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qualified to do business in all jurisdictions in which the nature of its business makes such qualification necessary and where failure to so qualify could result in a Material Adverse Event.  Borrower and each Obligated Party has the power and authority to execute, deliver, and perform its obligations under this Agreement and the other Loan Documents to which it is or may become a party. 
Section 6.2Financial Statements; Etc.
  Borrower and each Obligated Party has delivered to Lender (a) audited financial statements of Borrower and each Obligated Party as at and for the fiscal year ended December 31, 2013, (b) unaudited financial statements of Borrower and each Obligated Party for the three (3)-month period ended June 30, 2014, and (c) unaudited financial statements of Borrower and each Obligated Party for the two (2)-month period ended August 31, 2014. Such financial statements are true and correct, have been prepared in accordance with GAAP, and fairly and accurately present, on a consolidated basis, the financial condition of Borrower and each Obligated Party as of the respective dates indicated therein and the results of operations for the respective periods indicated therein.  Neither Borrower nor any other Obligated Party has any material contingent liabilities, liabilities for taxes, unusual forward or long-term commitments, or unrealized or anticipated losses from any unfavorable commitments except as referred to or reflected in such financial statements. No Material Adverse Event has occurred since the effective date of the financial statements referred to in this Section 6.2.  All projections delivered by Borrower and each Obligated Party to Lender have been prepared in good faith, with care and diligence and use assumptions that are reasonable under the circumstances at the time such projections were prepared and delivered to Lender and all such assumptions are disclosed in the projections. Neither Borrower nor any Obligated Party has any material Guarantees, contingent liabilities, liabilities for taxes, or any long-term leases or unusual forward or long-term commitments, or any hedge agreement or other transaction or obligation in respect of derivatives, that are not reflected in the most-recent financial statements referred to in this Section 6.2. As of August 31, 2014, other than the Debt listed on Schedule 6.2, Borrower and each Obligated Party had no Debt.
Section 6.3Action; No Breach.
  The execution, delivery, and performance by Borrower and each other Obligated Party of this Agreement and the other Loan Documents to which such Person is or may become a party and compliance with the terms and provisions hereof and thereof have been duly authorized by all requisite action on the part of such Person and do not and will not (a) violate or conflict with, or result in a breach of, or require any consent under (i) the Constituent Documents of such Person, (ii) any applicable law, rule, or regulation or any order, writ, injunction, or decree of any Governmental Authority or arbitrator, or (iii) any agreement or instrument to which such Person is a party or by which it or any of its Properties is bound or subject, or (b) constitute a default under any such agreement or instrument, or result in the creation or imposition of any Lien upon any of the revenues or assets of such Person.
Section 6.4Operation of Business.
  Borrower and each Obligated Party possess all licenses, permits, franchises, patents, copyrights, trademarks, and trade names, or rights thereto, necessary to conduct its respective businesses substantially as now conducted and as presently proposed to be conducted, and neither Borrower nor any Obligated Party is in violation of any valid rights of others with respect to any of the foregoing. Borrower and the Servicers (if any) of its Mortgage Loans are duly registered as mortgage lenders and servicers in each state in which Mortgage Loans have been or are from time to time originated, to the extent such registration is required by any applicable law, rule, or regulation or any order, writ, injunction, or decree of any Governmental Authority or arbitrator, except where the failure to register could not reasonably be expected to result in a Material Adverse Event.
Section 6.5Litigation and Judgments. 
Except as specifically disclosed in Schedule 6.5 as of the date hereof, there is no action, suit, investigation, or proceeding before or by any Governmental Authority or arbitrator pending, or to the knowledge of Borrower or any Obligated Party, threatened against or affecting Borrower or any 
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Obligated Party that could, if adversely determined, result in a Material Adverse Event.  There are no outstanding judgments against Borrower or any Obligated Party.
Section 6.6Rights in Properties; Liens.
  Borrower and each Obligated Party has good and indefeasible title to or valid leasehold interests in its respective Collateral and Properties, including the Collateral and Properties reflected in the financial statements described in Section 6.2, and none of the Collateral of Borrower or any Obligated Party is subject to any Lien, except as permitted by Section 8.2.
Section 6.7Enforceability.
  This Agreement constitutes, and the other Loan Documents to which Borrower or any other Obligated Party is a party, when delivered, shall constitute legal, valid, and binding obligations of such Person, enforceable against such Person in accordance with their respective terms, except as limited by bankruptcy, insolvency, or other laws of general application relating to the enforcement of creditors’ rights.
Section 6.8Approvals. 
No authorization, approval, or consent of, and no filing or registration with, any Governmental Authority or third party is or will be necessary for the execution, delivery, or performance by Borrower or any other Obligated Party of this Agreement and the other Loan Documents to which such Person is or may become a party or the validity or enforceability thereof.
Section 6.9Taxes.
  Borrower and each Obligated Party has filed all income and other material tax returns required to be filed, and has paid all of their respective liabilities for income and other material taxes, assessments, governmental charges, and other levies (in each case, in the nature of a tax) that are due and payable.  Borrower and each Obligated Party knows of no pending investigation of Borrower or any Obligated Party by any taxing authority or of any pending but unassessed tax liability of Borrower or any Obligated Party.
Section 6.10Use of Proceeds; Margin Securities.
  Neither Borrower nor any Obligated Party is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying “margin stock” (within the meaning of Regulations T, U, or X of the Board of Governors of the Federal Reserve System). The proceeds of any Borrowing will be used by Borrower solely for the purposes specified in Section 2.4. None of such proceeds will be used to purchase or carry any “margin stock”, or to reduce or retire any indebtedness originally incurred to purchase or carry “margin stock” or for any other purpose that might constitute this transaction a “purpose credit” within the meaning of such Regulation U. Borrower is not engaged in the business of extending credit for the purpose of purchasing or carrying margin stocks. Neither Borrower nor any Person acting on behalf of Borrower has taken or will take any action that might cause the Revolving Credit Note or any of the other Loan Documents, including this Agreement, to violate Regulation U or any other regulations of the Board of Governors of the Federal Reserve System or to violate Section 7 of the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereinafter be in effect. Borrower and its Affiliates own no “margin stock” except for that described in the financial statements referred to in Section 6.2 and, as of the date hereof, the aggregate value of all “margin stock” owned by Borrower and its Affiliates does not exceed twenty-five percent (25%) of all of the value of all of Borrower’s and its Affiliates’ assets.
Section 6.11ERISA.
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  Except to the extent that it would not result in a Material Adverse Event, (a) each Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS (or may rely on a favorable opinion letter issued by the IRS) or an application for such a letter is currently being processed by the IRS with respect thereto and, to the knowledge of Borrower or any Obligated Party, nothing has occurred which would prevent, or cause the loss of, such qualification, (b) no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan, (c) there are no pending or, to the knowledge of Borrower or Obligated Party, threatened claims, actions or lawsuits, or action by any Governmental Authority, with respect to any Plan, (d) there has been no Prohibited Transaction or violation of the fiduciary responsibility rules with respect to any Plan, (e) no ERISA Event has occurred or is reasonably expected to occur, (f) no Plan has any Unfunded Pension Liability, (g) no Obligated Party or ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Plan (other than premiums due and not delinquent under Section 4007 of ERISA), (h) no Obligated Party or ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) under Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan and (i) no Obligated Party or ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA.
Section 6.12Disclosure.
  No statement, information, report, representation, or warranty made by Borrower or any other Obligated Party in this Agreement or in any other Loan Document or furnished to Lender in connection with this Agreement or any of the transactions contemplated hereby contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements herein or therein not misleading.  There is no fact known to Borrower or any Obligated Party which is a Material Adverse Event, or which might in the future be a Material Adverse Event that has not been disclosed in writing to Lender.
Section 6.13Subsidiaries.
  Borrower has no Subsidiaries other than those listed on Schedule 6.13 (as such schedule may be updated from time to time pursuant to Section 7.12) and Schedule 6.13 sets forth the jurisdiction of formation or organization of each such Subsidiary and the percentage of Borrower’s ownership interest in such Subsidiary. All of the outstanding capital stock or other equity interests of each Subsidiary described on Schedule 6.13 has been validly issued, is fully paid, and is nonassessable. There are no outstanding subscriptions, options, warrants, calls, rights or other agreements or commitments of any nature relating to any equity interests of Borrower.
Section 6.14Agreements.
  Neither Borrower nor any Obligated Party is a party to any indenture, loan, or credit agreement, or to any lease or other agreement or instrument, or subject to any charter or limited liability, corporate or other organizational restriction, in each case which could result in a Material Adverse Event.  Neither Borrower nor any Obligated Party is in default in any respect in the performance, observance, or fulfillment of any of the obligations, covenants, or conditions contained in any agreement or instrument material to its business to which it is a party. No holder of Borrower’s or any Subsidiary’s debt or other obligations has given notice of any asserted default that could reasonably be expected to constitute a Material Adverse Event.  No liquidation or dissolution of Borrower is pending or, to Borrower’s knowledge, threatened and no liquidation or dissolution of any Subsidiary is pending or threatened that could reasonably be expected to constitute a Material Adverse Event.  No receivership, insolvency, bankruptcy, reorganization or other similar proceedings relative to Borrower or any of its properties is pending, or to Borrower’s knowledge, threatened.  No receivership, insolvency, bankruptcy, reorganization or other similar proceedings relative to any Subsidiary of Borrower or any of its properties is pending, or to Borrower’s knowledge, threatened that could reasonably be expected to constitute a Material Adverse Event. 
Section 6.15Compliance with Laws.
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  Neither Borrower nor any Obligated Party is in violation in any material respect of any law, rule, regulation, order, or decree of any Governmental Authority or arbitrator.
Section 6.16Regulated Entities.
  Neither Borrower nor any Obligated Party is (a) an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940 or (b) subject to regulation under the Federal Power Act, the Interstate Commerce Act, any state public utilities code, or any other federal or state statute, rule or regulation limiting its ability to incur Debt, pledge its assets or perform its obligations under the Loan Documents.
Section 6.17Environmental Matters.  
(a)Borrower and each Obligated Party, and all of its respective Properties, assets, and operations are in full compliance with all applicable Environmental Laws, except for any noncompliance that would not result in a Material Adverse Event.  Neither Borrower nor the Obligated Parties are aware of, nor have Borrower or any Obligated Party, received notice of, any past, present, or future conditions, events, activities, practices, or incidents which would reasonably be expected to interfere with or prevent the compliance or continued compliance of Borrower and the Obligated Parties with all Environmental Laws and that would reasonably be expected to result in a Material Adverse Event;
(b)Each of Borrower and the Obligated Parties has obtained all permits, licenses, and authorizations that are required under applicable Environmental Laws, and all such permits are in good standing and Borrower and each Obligated Party is in compliance with all of the terms and conditions of such permits, except to the extent failure to obtain any of the foregoing would not result in a Material Adverse Event;
(c)No Hazardous Materials exist on, about, or within or have been used, generated, stored, transported, disposed of on, or Released from any of the Properties or assets of Borrower or any Obligated Party, except as would not reasonably be expected to result in a Material Adverse Event.  The use which Borrower and any Obligated Party make and intend to make of their respective Properties and assets is not reasonably expected to result in the use, generation, storage, transportation, accumulation, disposal, or Release of any Hazardous Material on, in, or from any of their Properties or assets, except as would not reasonably be expected to result in a Material Adverse Event;
(d)Neither Borrower nor any Obligated Party nor any of their respective currently or, to the knowledge of Borrower, previously owned or leased Properties or operations is subject to any outstanding or, to the knowledge of Borrower, threatened order from or agreement with any Governmental Authority or other Person or subject to any judicial or docketed administrative proceeding with respect to (i) failure to comply with Environmental Laws, (ii) Remedial Action, or (iii) any Environmental Liabilities arising from a Release or threatened Release, except as would not reasonably be expected to result in a Material Adverse Event;
(e)There are no conditions or circumstances associated with the currently or, to the knowledge of Borrower, previously owned or leased Properties or operations of Borrower or any Obligated Party that would reasonably be expected to give rise to any Environmental Liabilities, except as would not reasonably be expected to result in a Material Adverse Event;
(f)Neither Borrower nor any Obligated Party is a treatment, storage, or disposal facility requiring a permit under the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq., regulations thereunder or any comparable provision of state law.  Borrower and each Obligated Party is in compliance with all applicable financial responsibility requirements of all Environmental Laws, except where the failure to comply would not reasonably be expected to result in a Material Adverse Event;
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(g)Neither Borrower nor any Obligated Party has filed or failed to file any notice required under applicable Environmental Law reporting a Release, except where the failure to do so would not reasonably be expected to result in a Material Adverse Event; and
(h)No Lien arising under any Environmental Law has attached to any property or revenues of Borrower or any Obligated Party that would reasonably be expected to result in a Material Adverse Event.
Section 6.18Membership and Standing.
  Borrower is an approved member in good standing of the MERS System. Borrower is (a) an approved servicer, seller/servicer or issuer, as applicable, of mortgage loans for Freddie Mac, (b) properly licensed and qualified to do business and in good standing in each jurisdiction in which such licensing and qualification is necessary to act as the servicer under any of the Servicing Agreements and applicable law, and (c) qualified to act as the servicer under the Servicing Agreements, and no event has occurred which would make Borrower unable to comply with all such eligibility requirements or which would require notification to Freddie Mac. Borrower has not received any written notice from any Governmental Authority that it intends to terminate or restrict Borrower’s status as an approved servicer in its programs for which Borrower is registered, approved or authorized.
Section 6.19Foreign Assets Control Regulations and Anti-Money Laundering.
  Each Obligated Party and each Subsidiary of each Obligated Party is and will remain in compliance in all material respects with all United States economic sanctions laws, Executive Orders and implementing regulations as promulgated by OFAC, and all applicable anti-money laundering and counter-terrorism financing provisions of the Bank Secrecy Act and all regulations issued pursuant to it.  No Obligated Party and no Subsidiary or, to the knowledge of the Borrower, Affiliate of any Obligated Party (a) is a Person designated by OFAC on the list of the Specially Designated Nationals and Blocked Persons with which a United States Person cannot deal with or otherwise engage in business transactions, (b) is organized or located in Cuba, Iran, Sudan or Syria, or (c) is 50 per cent or more owned by any person or entity described in (a) or (b), such that the entry into, or performance under, this Agreement or any other Loan Document would be prohibited under United States law.
Section 6.20Patriot Act.
  The Obligated Parties, each of their Subsidiaries, and each of their Affiliates are in compliance with (a) the Patriot Act, (b) the Beneficial Ownership Regulation and (c) all other applicable federal or state laws relating to “know your customer” and anti-money laundering rules and regulations.  No part of the proceeds of any Loan will be knowingly used directly or indirectly for any payments to any government official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977.
Section 6.21Nature of Business.  As of the date hereof, Borrower and each Obligated Party is engaged directly or through Subsidiaries and Affiliates in the Consumer Lending Business. 
Section 6.22Borrower’s Address. Borrower’s chief executive office and principal place of business are at 26642 Towne Centre Drive, Foothill Ranch, CA 92610 or at such other address as shall have been set forth in a written notice to the Lender at any time after the Closing Date. 
Section 6.23Special Representations Concerning Collateral. 
(a)The List of Eligible Agency Servicing Rights most recently submitted to the Lender is true and complete.
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(b)Borrower has not selected the Collateral in a manner that will adversely affect the Lender’s interests.
(c)Borrower is the legal and equitable owner and/or holder of the Collateral, free and clear of all Liens (other than the Lender’s Lien and the Agency’s Interest or the owner of any related Mortgage Loan in the case of Non-Agency Servicing Rights, as applicable) and the Collateral is validly pledged or assigned to the Lender, subject to no other Liens. Borrower has the sole right to act as servicer with respect to the Mortgage Loans pursuant to and subject to the terms and conditions of the Servicing Agreement.
(d)No fraud and, in addition, no material error, omission, misrepresentation, negligence or similar occurrence with respect to the Collateral and the Mortgage Loans related thereto has taken place on the part of Borrower or any of its Affiliates.
(e)No consent of any obligor or any other Person is required for the grant of the security interest provided in this Agreement by Borrower in any of the Collateral, other than consents that have been obtained, nor will any consent need to be obtained upon the occurrence of an Event of Default for the Lender to exercise its rights with respect to any of the Collateral (other than as provided in any applicable Acknowledgement Agreement).
(f)Each Servicing Agreement is a valid and binding obligation of Borrower, is in full force and effect, and is enforceable by Borrower in accordance with its terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally, and subject, as to enforceability, to general principles of equity, whether applied in a court of law or a court of equity.
(g)Freddie Mac or, with respect to any Non-Agency Servicing Rights, any other owner of Mortgage Loans, has not provided written notice to Borrower that it will terminate, modify or amend the Servicing Agreement or Borrower’s benefits or the Servicing Rights under any Servicing Agreement.
(h)Borrower has not engaged any subservicers, subcontractors or other agents to perform any of its duties under any of the Servicing Agreements, other than engagements that are permitted by, and are in compliance in all material respects with the requirements of, the applicable Servicing Agreement, and all fees and expenses due and payable to any such subservicer, subcontractor or agent as of the Closing Date in connection therewith have been paid, or will be paid before overdue, by Borrower.
All representations and warranties by Borrower shall survive delivery of the Loan Documents and the making of the Borrowings, and any investigation at any time made by or on behalf of the Lender shall not diminish the Lender’s right to rely on them.
SECTION 7Affirmative Covenants
Borrower covenants and agrees that, as long as the Obligations or any part thereof are outstanding or Lender has any Commitment hereunder:
Section 7.1Reporting Requirements.
  Borrower shall, and shall cause each Obligated to, furnish to Lender:
(a)Annual Financial Statements.  For the fiscal year ending December 31, 2014, and each fiscal year thereafter, as soon as available, and in any event within ninety (90) days after the last day of each fiscal year of Borrower and each Obligated Party, a copy of the annual audit report of Borrower and each Obligated Party for such fiscal year containing, on a consolidated basis, balance sheets and statements of income, retained earnings, and cash flow as of the end of such fiscal year and for the twelve (12)-month period then ended, in each case setting forth in comparative form the figures for the preceding fiscal year, all in reasonable detail and audited and 
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certified by independent certified public accountants of recognized standing acceptable to Lender, to the effect that such report has been prepared in accordance with GAAP and containing no material qualifications or limitations on scope;
(b)Quarterly Financial Statements.  As soon as available, and in any event within forty-five (45) days after the last day of each fiscal quarter of each fiscal year of Borrower and each Obligated Party, a copy of an unaudited financial report of Borrower and each such Obligated Party as of the end of such fiscal quarter and for the portion of the fiscal year then ended, containing, on a consolidated and consolidating basis, balance sheets and statements of income, retained earnings, and cash flow, in each case setting forth in comparative form the figures for the corresponding period of the preceding fiscal year, all in reasonable detail certified by a Responsible Officer to have been prepared in accordance with GAAP and to fairly and accurately present (subject to year-end audit adjustments) the financial condition and results of operations of Borrower and each such Obligated Party, on a consolidated and consolidating basis, as of the dates and for the periods indicated therein;
(c)Borrowing Base Report.  As soon as available, and in any event within thirty (30) days after the last day of each calendar month of each fiscal year of Borrower, a Borrowing Base Report;
(d)Compliance Certificate.  Concurrently with the delivery of each of the financial statements referred to in Sections 7.1.(a) and 7.1.(b), a certificate of the chief financial officer of Borrower (i) stating that to the best of such officer’s knowledge, no Default or Event of Default has occurred and is continuing, or if a Default or Event of Default has occurred and is continuing, a statement as to the nature thereof and the action which is proposed to be taken with respect thereto, and (ii) showing in reasonable detail the calculations demonstrating compliance with the covenants set forth in Section 2 of the Pricing Side Letter;
(e)Management Letters.  Promptly upon receipt thereof, a copy of any management letter or written report submitted to Borrower or any Obligated Party by independent certified public accountants with respect to the business, condition (financial or otherwise), operations, prospects, or Properties of Borrower or any Obligated Party;
(f)Notice of Litigation.  Promptly after the commencement thereof, notice of all actions, suits, and proceedings before any Governmental Authority or arbitrator affecting Borrower or any Obligated Party which, if determined adversely to Borrower or such Obligated Party, could be a Material Adverse Event;
(g)Notice of Default.  As soon as possible and in any event within five (5) days after the occurrence of any Default or Event of Default, a written notice setting forth the details of such Default or Event of Default and the action that Borrower has taken and proposes to take with respect thereto;
(h)ERISA Reports.  Promptly after the filing or receipt thereof, copies of all reports, including annual reports, and notices which Borrower or any ERISA Affiliate files with or receives from the PBGC, the IRS, or the U.S. Department of Labor under ERISA; as soon as possible and in any event within five (5) days after Borrower or any ERISA Affiliate knows or has reason to know that any ERISA Event or Prohibited Transaction has occurred with respect to any Plan, a certificate of the chief financial officer of Borrower setting forth the details as to such ERISA Event or Prohibited Transaction and the action that Borrower proposes to take with respect thereto; annually, copies of the notice described in Section 101(f) of ERISA that Borrower or ERISA Affiliate receives with respect to a Plan or Multiemployer Plan; within thirty (30) days following the execution of this Agreement, Borrower and each ERISA Affiliate shall request in writing from each Multiemployer Plan the information described in Sections 101(k) and 101(l) of ERISA and shall provide a copy of such requests to Lender; promptly upon receiving such information from the Multiemployer Plans, provide such information to Lender, and thereafter, such requests and such information shall only be required to be provided upon Lender’s request, which shall be made no more frequently than annually;
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(i)Reserved.  
(j)Notice of Material Adverse Event.  As soon as possible and in any event within five (5) days after the occurrence thereof, written notice of any event or circumstance that could result in a Material Adverse Event; 
(k)Notice of Attachment.  Promptly, and in any event within ten (10) days after the commencement thereof, notice of any attachment, sequestration, or similar proceeding or proceedings against Borrower involving an aggregate amount in excess of $1,000,000 against any of its assets or properties; 
(l)Beneficial Ownership.   
(i)Promptly (1) of any change in direct or indirect ownership interests in Borrower as reported in a “Beneficial Ownership Certification” or other similar certification provided to Lender prior to or in connection with the execution of this Agreement, or (2) if the individual with significant managerial responsibility identified in the certification ceases to have that responsibility or if the information reported about that individual changes;
(ii)Such information and documentation as Lender may request during the term of this Agreement to confirm or update the continued accuracy of the any information provided in connection with the foregoing;
(m)Reserved. 
(n)Other Reports. Borrower shall promptly furnish to the Lender from time to time information regarding the business and affairs of Borrower,  including the following and such other information as the Lender may from time to time reasonably request (each report required must be signed by a duly authorized officer of Borrower and the Lender will have no responsibility to verify or track any of the items referenced or conclusions stated in such reports or to verify the authority of its signatory), and Borrower shall
(i)Upon request by the Lender from time to time, expeditiously apply for and, if such counterparties are willing to make such agreements with Borrower (Borrower agrees in good faith to urge them to do so), to execute such acknowledgment agreements and related agreements with the counterparties to Servicing Agreements as are necessary or appropriate, in the Lender’s reasonable opinion, to achieve, maintain or improve establishment and perfection of the Lender’s security interest granted hereby in Collateral.
(ii)Reserved.
(iii)Monthly, a report, to deliver to the Lender in form and substance acceptable to the Lender, detailing the most current unpaid principal balance of all Pledged Servicing Rights, any request for, or resolution of a prior request for, repurchase or indemnity under the Approved Servicing Agreements, updated information from the most recent servicing valuation report and delinquency and foreclosure information.
(iv)To deliver to the Lender such other reports by Borrower in respect of the Collateral, in such detail and at such times as the Lender or any Lender in its reasonable discretion or at the reasonable direction of a Lender may request at any time or from time to time.
(v)As soon as available and in any event within 10 days of the date distributed, deliver to the Lender copies of all definitive prospectuses relating to (i) any public security offerings by Borrower or any of its Subsidiaries (including 
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special purpose Subsidiaries) or (ii) any public securities to be based on, backed by or created from any Collateral and to be offered by Borrower or any of its Subsidiaries.
(vi)As soon as available and in any event within 10 days after filing, deliver to the Lender copies of (i) all regular or periodic financial reports, and copies of all extraordinary or non-routine filings, if any, that shall be filed with the U.S. Securities and Exchange Commission or any successor agency by or on behalf of Borrower or any of its Subsidiaries (including special purpose Subsidiaries) and (ii) all such filings relating to any public securities that are or are to be based on, backed by or created from any Collateral and which filings are made by or in respect of Borrower or any of its Subsidiaries; and
(o)General Information.  Promptly, such other information concerning Borrower, or any Obligated Party as Lender may from time to time request.
Section 7.2Maintenance of Existence; Conduct of Business.
Borrower shall, and shall cause each Obligated Party to, preserve and maintain its existence and all of its leases, privileges, licenses, permits, franchises, qualifications, and rights that are necessary or desirable in the ordinary conduct of its business.  Borrower shall, and shall cause each Obligated Party to, conduct its business in an orderly and efficient manner in accordance with good business practices. 
Section 7.3Maintenance of Properties.
  Borrower shall, and shall cause each Obligated Party to, maintain, keep, and preserve all of its Properties (tangible and intangible) necessary or useful in the proper conduct of its business in good working order and condition.
Section 7.4Taxes and Claims.
 Borrower shall, and shall cause each Obligated Party to, pay or discharge at or before maturity or before becoming delinquent (a) all taxes, levies, assessments, and governmental charges imposed on it or its income or profits or any of its Property, and (b) all lawful claims for labor, material, and supplies, which, if unpaid, might become a Lien upon any of its Property; provided, however, that neither Borrower nor any Obligated Party shall be required to pay or discharge any tax, levy, assessment, or governmental charge which is being contested in good faith by appropriate proceedings diligently pursued, and for which adequate reserves in accordance with GAAP have been established.
Section 7.5Insurance.
 Borrower shall, and shall cause each Obligated Party to, maintain insurance with financially sound and reputable insurance companies in such amounts and covering such risks as is usually carried by limited liability companies engaged in similar businesses and owning similar Properties in the same general areas in which Borrower and each Obligated Party operate, provided that in any event Borrower will maintain and cause each Obligated Party to maintain workmen’s compensation insurance, property insurance, comprehensive general liability insurance and business interruption insurance reasonably satisfactory to Lender.  
Section 7.6Inspection Rights.
At any reasonable time and from time to time, Borrower shall, and shall cause each Obligated Party to, (a) permit representatives of Lender to examine, inspect, review, evaluate and make physical verifications and appraisals of the inventory and other Collateral in any manner and through any medium that Lender considers advisable, (b) to examine, copy, and make extracts from its books and records, (c) to visit and inspect its Properties, and (d) to discuss its business, operations, and financial condition with its officers, employees, and independent certified public accountants, in each instance, at Borrower’s 
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expense provided that Borrower shall not be responsible for costs and expenses more than one time per year unless an Event of Default has occurred and is continuing.
Section 7.7Keeping Books and Records.
Borrower shall, and shall cause each Obligated Party to, maintain proper books of record and account in which full, true, and correct entries in conformity with GAAP shall be made of all dealings and transactions in relation to its business and activities.
Section 7.8Compliance with Laws.
Borrower shall, and shall cause each Obligated Party to, comply in all material respects with all applicable laws, rules, regulations, orders, and decrees of any Governmental Authority or arbitrator.
Section 7.9Compliance with Agreements.
Borrower shall, and shall cause each Obligated Party to, comply in all material respects with all agreements, contracts, and instruments binding on it or affecting its Properties or business.
Section 7.10Further Assurances.
Borrower shall, and shall cause each Obligated Party to, execute and deliver such further agreements and instruments and take such further action as may be requested by Lender to carry out the provisions and purposes of this Agreement and the other Loan Documents and to create, preserve, and perfect the Liens of Lender in the Collateral.
Section 7.11ERISA.
Borrower shall, and shall cause each Obligated Party to, comply with all minimum funding requirements, and all other material requirements, of ERISA, if applicable, so as not to give rise to any liability thereunder that would reasonably be expected to result in a Material Adverse Event.
Section 7.12Additional Subsidiaries.
Borrower shall notify Lender at the time that any Person becomes a Subsidiary that is formed under the laws of the United States or any state thereof, which notification shall be made by means of delivery of an updated version of Schedule 6.13.
Section 7.13Reserved.
Section 7.14Provide Monthly Servicing Appraisals.  Borrower shall provide a new Servicing Appraisal to the Lender once each calendar month (with the first such period ending December 31, 2014); provided, that the Lender shall have the right in the Lender’s sole discretion to require independent appraisals or evaluations more frequently than every calendar month; and provided further that the Servicing Appraisal for each calendar month must be provided to the Lender no later than thirty (30) days following the end of such month.
Section 7.15Special Affirmative Covenants Concerning Collateral. Until all of the Obligations shall have been fully paid in cash and satisfied and the Lender has no obligation to lend or provide any other financial accommodations to Borrower under or otherwise in respect of this Agreement, Borrower agrees to:
(a)Warrant and forever defend the right, title and interest of the Lender, for the benefit of itself and the other Secured Parties, in and to the Pledged Servicing Rights against the claims and demands of all Persons whomsoever other than the Agency or the owner of any related Mortgage Loan in the case of Non-Agency Servicing Rights, as applicable, subject to any restrictions imposed by the relevant Servicing Agreement or the 
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Acknowledgment Agreement for the benefit of the party to it on whose behalf the Mortgage Loans are being serviced to the extent (if any) that such restrictions are valid and enforceable under the applicable UCC and other Laws.
(b)Diligently fulfill its duties and obligations under each Approved Servicing Agreement, and not be declared by a counterparty to each such Servicing Agreement to be in default; provided that Borrower shall not be in breach of this covenant if a default declared by a counterparty to such Servicing Agreement arose from a failure of the portfolio of Serviced Loans to perform as required by the relevant Servicing Agreement and such counterparty has elected in writing to continue to use Borrower as Servicer thereof and has not rescinded or revoked such election.
(c)Diligently and timely collect its servicing compensation under each Approved  Servicing Agreement.
(d)Cause Borrower’s rights to the servicing compensation provided for in each Approved Servicing Agreement to remain in full force and effect until the Borrowings to finance Borrower’s retention of the Pledged Servicing Rights related to such Approved Servicing Agreement have been fully repaid, or until such Servicing Agreement expires in accordance with its terms and without renewal.
(e)Reconfirm the filing authorization given in this Agreement to such UCC financing statements and continuation statements as the Lender may reasonably request from time to time (although no such reconfirmation shall be a condition to the filing of any financing statement, including any “in lieu” financing statement, or continuation statement) and execute and deliver to the Lender such further instruments of sale, pledge, assignment or transfer, and such powers of attorney, as shall be reasonably required by the Lender from time to time, and do and perform all matters and things necessary or desirable to be done or observed, for the purpose of effectively creating, maintaining and preserving the security and benefits intended to be afforded the Lender and the Lenders under this Agreement, the Revolving Credit Note and the other Loan Documents.  The Lender shall have all the rights and remedies of a secured party under the UCC and any other applicable law, in addition to all rights provided for in this Agreement.
(f)Use its best efforts to cause each of its Servicers, if any, to keep in force throughout the term of this Agreement (i) a policy or policies of insurance covering errors and omissions for failure to maintain insurance as required by this Agreement and (ii) a fidelity bond.  Each such policy and fidelity bond shall be in such form and amount as is generally customary among Persons who service a portfolio of Mortgage Loans having an aggregate principal amount comparable to that of the servicing portfolio of such Servicer or Borrower, respectively, and which are generally regarded as servicers acceptable to institutional investors.
SECTION 8Negative Covenants
Borrower covenants and agrees that, as long as the Obligations or any part thereof are outstanding or Lender has any Commitment hereunder:
Section 8.1Reserved.
Section 8.2Limitation on Liens.  Other than the Agency’s Interest, Borrower shall not pledge, grant a security interest or assign any existing or future rights to service any of the Collateral or to be compensated for servicing any of the Collateral, or pledge or grant to any other Person any security interest in any Servicing Rights (other than the Servicing Rights set forth on Schedule 4.1(a)(1) as delivered by Borrower to Lender on the Closing Date). Borrower shall not permit any Servicing Rights, other than the Servicing Rights set forth on Schedule 4.1(a)(1) and delivered by Borrower to Lender as of the Closing Date, to become Excluded Collateral.
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Section 8.3Mergers. 
(a)Borrower shall not, and shall not permit any Obligated Party to, directly or indirectly, become a party to a merger or consolidation, or purchase or otherwise acquire all or any part of the assets of any Person or any shares or other evidence of beneficial ownership of any Person, or wind-up, dissolve, or liquidate, if such transaction would constitute an Organic Change.
(b)Borrower shall not, and shall not permit any Obligated Party to, divide into separate Persons (as may be permitted under the Delaware Limited Liability Company Act) without the written consent of the Lender.
Section 8.4Restricted Payments.
At any time an Event of Default has occurred and is continuing or would result therefrom, Borrower shall not pay, make, declare or incur any liability to pay, make, declare or incur any dividends or other distribution, direct or indirect, on or on account of any shares of its stock (or equivalent equity interest) or any redemption or other acquisition, direct or indirect, of any shares of its stock (or equivalent equity interest) or of any warrants, rights or other options to purchase any shares of its stock (or equivalent equity interest), nor purchase, acquire, redeem or retire any stock (or equivalent equity interest) in itself whether now or hereafter outstanding, except that, notwithstanding the foregoing, the Borrower shall be permitted at all times (regardless of whether or not a Default or Event of Default exists) to make Permitted Distributions.
Section 8.5Reserved.
Section 8.6Transactions With Affiliates.
Borrower shall not, and shall not permit any Obligated Party to, directly or indirectly, enter into any transaction, including, without limitation, the purchase, sale, or exchange of property, the rendering of any service or the payment of any management, advisory or similar fees, with any Affiliate of Borrower or such Obligated Party, except in the Ordinary Course of Business and pursuant to the reasonable requirements of Borrower’s or such Obligated Party’s business, pursuant to a transaction which is otherwise not prohibited under this Agreement, and upon fair and reasonable terms no less favorable to Borrower or such Obligated Party than would be obtained in a comparable arm’s-length transaction with a Person not an Affiliate of Borrower or such Obligated Party.
Section 8.7Disposition of Assets.
  Borrower shall not, and shall not permit any Obligated Party to, directly or indirectly, sell, lease, assign, transfer, or otherwise dispose of any of the Collateral if, after giving effect to the application of proceeds of such disposition, a Borrowing Base Deficiency would exist.
Section 8.8Reserved.
Section 8.9Reserved.
Section 8.10Nature of Business.
  Borrower shall not, and shall not permit any Obligated Party to, engage in any business other than the Consumer Lending Business.
Section 8.11Environmental Protection.
  Borrower shall not, and shall not permit any Obligated Party to, directly or indirectly (a) use (or permit any tenant to use) any of their respective Properties or assets for the handling, processing, storage, transportation, or disposal of any Hazardous Material, (b) generate any Hazardous Material, (c) conduct any activity that is likely to cause a Release or threatened Release of any Hazardous Material, or (d) 
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otherwise conduct any activity or use any of their respective Properties or assets in any manner that is likely to violate any Environmental Law or create any Environmental Liabilities for which Borrower or any Obligated Party would be responsible.
Section 8.12Accounting.
  Borrower shall not, and shall not permit any Obligated Party to, change its fiscal year or make any change (a) in accounting treatment or reporting practices, except as required by GAAP and disclosed to Lender, or (b) in tax reporting treatment, except as required by law and disclosed to Lender.
Section 8.13No Negative Pledge.
  Borrower shall not, and shall not permit any Obligated Party to, enter into or permit to exist any arrangement or agreement, other than pursuant to this Agreement or any Loan Document, which directly or indirectly prohibits Borrower or any Obligated Party from creating or incurring a Lien on the Collateral.
Section 8.14Reserved.
Section 8.15Reserved.
Section 8.16OFAC.
  Borrower shall not, and shall not permit any Obligated Party to, fail to comply with the laws, regulations and executive orders referred to in Section 6.19 and Section 6.20.
Section 8.17Reserved.
Section 8.18Conditional Repurchase, Indemnity or Other Recourse Obligations
.  Borrower shall not undertake or assume any conditional repurchase, indemnity or other recourse obligations in respect of Mortgage Loans sold which obligations and liabilities, when combined with Borrower’s contingent liabilities, constitute contingent liabilities that are required by GAAP either to be accrued as a charge to income or to be disclosed by a note to Borrower’s financial statements in excess of Borrower’s loan loss reserve.
Section 8.19Special Negative Covenants Concerning Collateral. 
(a)Without the Lender’s prior written consent, Borrower shall not execute any amendments to any Servicing Agreement that could reasonably be expected to materially and adversely affect the value of any Collateral or to reduce or delay payment or collection of amounts due Borrower from or in respect of any Collateral and Borrower will provide a copy of every supplement, amendment, restatement or replacement of any of such Servicing Agreements to the Lender promptly (and in no event later than five (5) Business Days) after the same shall become effective other than any such supplements or amendments that are imposed by the Agency on all servicers through the Guide or otherwise.
(b)Borrower shall not create, incur, grant, assume or suffer to exist any Lien on any of the Collateral, except only for Liens in favor of the Lender pursuant to this Agreement.
(c)Borrower shall not offer as Collateral any property against which any Person other than the Lender (for the benefit of itself and the Secured Parties) has a Lien.
Section 8.20Termination of Servicing Agreements or Servicing Rights
Borrower shall not, and (except as described in the following proviso) shall not give any Agency advance written notice of any intention to, terminate its contractual rights to the servicing of any Mortgage 
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Loans (unless such termination is at Lender’s express direction); provided, that Borrower shall observe any notice or other requirements of any Approved Servicing Agreement in connection with any such termination. 
Section 8.21No Amendments
Borrower will make, or permit to be made, any amendments or modifications to its Constituent Documents, which could reasonably be expected to have a material adverse effect on Borrower or its Subsidiaries or Lender.
SECTION 9

RESERVED
SECTION 10Default
Section10.1Events of Default.
  Each of the following shall be deemed an “Event of Default”:
(a)Borrower shall fail to pay the Obligations or any part thereof shall not be paid when due or declared due;
(b)Borrower shall fail to provide to Lender timely any notice of Default or Event of Default as required by Section 7.1.(g) of this Agreement or Borrower shall breach (i) any provision of Section 8 of this Agreement or (ii) any provision of Section 2 the Pricing Side Letter;
(c)Any representation or warranty made or deemed made by Borrower or any other Obligated Party (or any of their respective officers) in any Loan Document or in any certificate, report, notice, or financial statement furnished at any time in connection with this Agreement shall be false, misleading, or erroneous in any material respect (without duplication of any materiality qualifier contained therein) when made or deemed to have been made; provided that if any of the Company’s representations in Section 6.23 (titled “Special Representations Concerning Collateral”) for any reason shall be (or shall prove to have been) untrue or incorrect, then such untruth or incorrectness shall not constitute a Default or an Event of Default, although, such untruth or incorrectness will result in the affected items of Collateral each thereupon having a Collateral Value of zero;
(d)Borrower or any Obligated Party shall fail to perform, observe, or comply with any covenant, agreement, or term contained in this Agreement or any other Loan Document (other than as covered by Sections 10.1(a) and (b)), and such failure continues for more than ten (10) days following the date such failure first began;
(e)Borrower or any other Obligated Party shall commence a voluntary proceeding seeking liquidation, reorganization, or other relief with respect to itself or its debts under any bankruptcy, insolvency, or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian, or other similar official of it or a substantial part of its Property or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it or shall make a general assignment for the benefit of creditors or shall generally fail to pay its debts as they become due or shall take any limited liability company action to authorize any of the foregoing;
(f)An involuntary proceeding shall be commenced against Borrower or any Obligated Party seeking liquidation, reorganization, or other relief with respect to it or its debts under any bankruptcy, insolvency, or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian, or other similar official for it or a substantial part of its 
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Property, and such involuntary proceeding shall remain undismissed and unstayed for a period of thirty (30) days;
(g)Borrower or any other Obligated Party shall fail to pay when due any principal of or interest on any Debt (other than the Obligations), or the maturity of any such Debt shall have been accelerated, or any such Debt shall have been required to be prepaid prior to the stated maturity thereof, or any event shall have occurred that permits (or, with the giving of notice or lapse of time or both, would permit) any holder or holders of such Debt or any Person acting on behalf of such holder or holders to accelerate the maturity thereof or require any such prepayment  (provided that no Event of Default shall be deemed to have occurred or be continuing if the holder or holders of such Debt waives their right to accelerate the maturity or require any such prepayment);
(h)A default or event of default occurs with respect to any document that evidences any of the Obligations, or any other event shall occur or condition shall exist if the effect of such, default, event of default, event or condition is to cause, or to permit the holders of any of the Obligations to cause, any Obligation to become due prior to the stated maturity or stated due date thereof;
(i)This Agreement or any other Loan Document shall cease to be in full force and effect or shall be declared null and void or the validity or enforceability thereof shall be contested or challenged by Borrower, any Obligated Party or any of their respective equity holders, or Borrower or any Obligated Party shall deny that it has any further liability or obligation under any of the Loan Documents, or any Lien created by the Loan Documents shall for any reason cease to be a valid, first priority perfected Lien upon any of the Collateral purported to be covered thereby;
(j)Any of the following events shall occur or exist with respect to Borrower or any ERISA Affiliate: (i) any ERISA Event occurs with respect to a Plan or Multiemployer Plan, or (ii) any Prohibited Transaction involving any Plan; and in each case above, such event or condition, together with all other events or conditions, if any, have subjected or could in the reasonable opinion of Lender subject Borrower or any ERISA Affiliate to any tax, penalty, or other liability to a Plan, a Multiemployer Plan, the PBGC, the IRS, the U. S. Department of Labor, or otherwise (or any combination thereof) which in the aggregate exceed or could reasonably be expected to result in a Material Adverse Event;
(k)A Change of Control or an Organic Change shall occur;
(l)Borrower, any of its Subsidiaries, or any Obligated Party, or any of their properties, revenues, or assets, shall become subject to an order of forfeiture, seizure, or divestiture (whether under the Racketeer Influenced and Corrupt Organization Act of 1970 or otherwise) and the same shall not have been discharged within thirty (30) days from the date of entry thereof;
(m)Borrower or any Obligated Party shall fail to discharge, stay or appeal within a period of thirty (30) days after the commencement thereof any attachment, sequestration, or similar proceeding or proceedings involving an aggregate amount in excess of $1,000,000 against any of its assets or Properties; 
(n)A final judgment or judgments for the payment of money in excess of $1,000,000 individually or $2,500,000 in the aggregate shall be rendered by a court or courts against Borrower or any Obligated Party and the same shall not be discharged (or provision shall not be made for such discharge), or a stay of execution thereof shall not be procured, within thirty (30) days from the date of entry thereof and Borrower or such Obligated Party shall not, within such period of thirty (30) days, or such longer period during which execution of the same shall have been satisfied, stayed, appeal therefrom or cause the execution thereof to be stayed during such appeal; 
(o)Lender determines that a Material Adverse Event has occurred or a circumstance exists that could result in a Material Adverse Event; 
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(p)Borrower shall take or omit to take any act (i) that would result in the suspension or loss of any of its statuses, once achieved or any of such statuses of its subservicer, if any, of any Agency’s Mortgage Loans pools for which Borrower is Servicer, as an Agency-approved servicer, or (ii) after which Borrower or any such relevant subservicer would no longer be in good standing as such, or (iii) after which Borrower or any such relevant subservicer would no longer currently satisfy all applicable Agency’s net worth requirements, if all of the material effects of such act or omission shall have not been cured by Borrower or waived by the relevant Agency before termination of such status; 
(q)Borrower’s rights to service Mortgage Loans for any one or more investors under Servicing Agreements the value of which rights to Borrower (as reasonably estimated by the Lender) equals or exceeds 5.00% of the aggregate principal amount of Borrower’s Servicing Portfolio shall be terminated for cause (i.e., on account of act(s) or omission(s) by Borrower for which the holder, or a trustee for the holder, of the relevant Serviced Loans has the right under such Servicing Agreement to terminate such servicing rights); 
(r)Either Freddie Mac or, with respect to any Non-Agency Servicing Rights, any other owner of Mortgage Loans, terminates any Servicing Right or Servicing Agreement related to the Collateral that has been Pledged to Lender; or
(s)A Servicer Downgrade Event has occurred.
Section10.2Remedies Upon Default.
  If any Event of Default shall occur and be continuing, then Lender may without notice terminate the Commitment or declare the Obligations or any part thereof to be immediately due and payable, or both, and the same shall thereupon become immediately due and payable, without notice, demand, presentment, notice of dishonor, notice of acceleration, notice of intent to accelerate, notice of intent to demand, protest, or other formalities of any kind, all of which are hereby expressly waived by Borrower; provided, however, that upon the occurrence of an Event of Default under Section 10.1(e) or (f), the Commitment shall automatically terminate, and the Obligations shall become immediately due and payable, in each case without notice, demand, presentment, notice of dishonor, notice of acceleration, notice of intent to accelerate, notice of intent to demand, protest, or other formalities of any kind, all of which are hereby expressly waived by Borrower.  In addition to the foregoing, if any Event of Default shall occur and be continuing, Lender may exercise all rights and remedies available to it in law or in equity, under the Loan Documents, or otherwise.
Section10.3Application of Funds.
  After the exercise of remedies provided for in Section 10.2 (or after the Loans have automatically become immediately due and payable), any amounts received on account of the Obligations shall be applied by Lender in such order as it elects in its sole discretion.
Section10.4Performance by Lender.
  If Borrower shall fail to perform any covenant or agreement contained in any of the Loan Documents, then Lender may perform or attempt to perform such covenant or agreement on behalf of Borrower.  In such event, Borrower shall, at the request of Lender, promptly pay to Lender any amount expended by Lender in connection with such performance or attempted performance, together with interest thereon at the Default Interest Rate from and including the date of such expenditure to but excluding the date such expenditure is paid in full.  Notwithstanding the foregoing, it is expressly agreed that Lender shall not have any liability or responsibility for the performance of any covenant, agreement, or other obligation of Borrower under this Agreement or any other Loan Document.
SECTION 11Miscellaneous
Section11.1Expenses.
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  Borrower hereby agrees to pay on demand: (a) all costs and expenses of Lender in connection with the preparation, negotiation, execution, and delivery of this Agreement and the other Loan Documents and any and all amendments, modifications, renewals, extensions, and supplements thereof and thereto, including, without limitation, the reasonable fees and expenses of legal counsel, advisors, consultants, and auditors for Lender; (b) all costs and expenses of Lender in connection with any Default or Event of Default and the enforcement of this Agreement or any other Loan Document, including, without limitation, the fees and expenses of legal counsel, advisors, consultants, and auditors for Lender; (c) all transfer, stamp, documentary, or other similar taxes, assessments, or charges levied by any Governmental Authority in respect of this Agreement or any of the other Loan Documents; (d) all costs, expenses, assessments, and other charges incurred in connection with any filing, registration, recording, or perfection of any Lien contemplated by this Agreement or any other Loan Document; and (e) all other costs and expenses incurred by Lender in connection with this Agreement or any other Loan Document, any litigation, dispute, suit, proceeding or action; the enforcement of its rights and remedies, and the protection of its interests in bankruptcy, insolvency or other legal proceedings, including, without limitation, all costs, expenses, and other charges (including Lender’s internal charges) incurred in connection with evaluating, observing, collecting, examining, auditing, appraising, selling, liquidating, or otherwise disposing of the Collateral or other assets of Borrower.
Section11.2INDEMNIFICATION.
  BORROWER SHALL INDEMNIFY LENDER AND EACH AFFILIATE THEREOF AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, ATTORNEYS, AND AGENTS FROM, AND HOLD EACH OF THEM HARMLESS AGAINST, ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS’ FEES) TO WHICH ANY OF THEM MAY BECOME SUBJECT WHICH DIRECTLY OR INDIRECTLY ARISE FROM OR RELATE TO (A) THE NEGOTIATION, EXECUTION, DELIVERY, PERFORMANCE, ADMINISTRATION, OR ENFORCEMENT OF ANY OF THE LOAN DOCUMENTS, (B) ANY OF THE TRANSACTIONS CONTEMPLATED BY THE LOAN DOCUMENTS, (C) ANY BREACH BY BORROWER OF ANY REPRESENTATION, WARRANTY, COVENANT, OR OTHER AGREEMENT CONTAINED IN ANY OF THE LOAN DOCUMENTS, (D) THE PRESENCE, RELEASE, THREATENED RELEASE, DISPOSAL, REMOVAL, OR CLEANUP OF ANY HAZARDOUS MATERIAL LOCATED ON, ABOUT, WITHIN, OR AFFECTING ANY OF THE PROPERTIES OR ASSETS OF BORROWER OR ANY OF ITS SUBSIDIARIES OR ANY OTHER OBLIGATED PARTY, OR (E) ANY INVESTIGATION, LITIGATION, OR OTHER PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY THREATENED INVESTIGATION, LITIGATION, OR OTHER PROCEEDING, RELATING TO ANY OF THE FOREGOING.  WITHOUT LIMITING ANY PROVISION OF THIS AGREEMENT OR OF ANY OTHER LOAN DOCUMENT, IT IS THE EXPRESS INTENTION OF THE PARTIES HERETO THAT EACH PERSON TO BE INDEMNIFIED UNDER THIS SECTION SHALL BE INDEMNIFIED FROM AND HELD HARMLESS AGAINST ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS’ FEES) ARISING OUT OF OR RESULTING FROM THE SOLE CONTRIBUTORY OR ORDINARY NEGLIGENCE OF SUCH PERSON.
Section11.3Limitation of Liability.
  Neither Lender nor any Affiliate, officer, director, employee, attorney, or agent of Lender shall have any liability with respect to, and Borrower hereby waives, releases, and agrees not to sue any of them upon, any claim for any special, indirect, incidental, or consequential damages suffered or incurred by Borrower or any other Obligated Party in connection with, arising out of, or in any way related to, this Agreement or any of the other Loan Documents, or any of the transactions contemplated by this Agreement or any of the other Loan Documents.  Borrower hereby waives, releases, and agrees not to sue Lender or any of Lender’s Affiliates, officers, directors, employees, attorneys, or agents for punitive damages in respect of any claim in connection with, arising out of, or in any way related to, this Agreement or any of the other Loan Documents, or any of the transactions contemplated by this Agreement or any of the other Loan Documents.
Section11.4No Duty.
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  All attorneys, accountants, appraisers, and other professional Persons and consultants retained by Lender shall have the right to act exclusively in the interest of Lender and shall have no duty of disclosure, duty of loyalty, duty of care, or other duty or obligation of any type or nature whatsoever to Borrower or any of Borrower’s equity holders, Affiliates, officers, employees, attorneys, agents, or any other Person.
Section11.5Lender Not Fiduciary.
  The relationship between Borrower and Lender is solely that of debtor and creditor, and Lender has no fiduciary or other special relationship with Borrower, and no term or condition of any of the Loan Documents shall be construed so as to deem the relationship between Borrower and Lender to be other than that of debtor and creditor.
Section11.6Equitable Relief.
  Borrower recognizes that in the event Borrower fails to pay, perform, observe, or discharge any or all of the Obligations, any remedy at law may prove to be inadequate relief to Lender.  Borrower therefore agrees that Lender, if Lender so requests, shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages.
Section11.7No Waiver; Cumulative Remedies.
  No failure on the part of Lender to exercise and no delay in exercising, and no course of dealing with respect to, any right, remedy, power, or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege. The rights and remedies provided for in this Agreement and the other Loan Documents are cumulative and not exclusive of any rights and remedies provided by law.
Section11.8Successors and Assigns.
  This Agreement is binding upon and shall inure to the benefit of Lender and Borrower and its successors and assigns, except that Borrower may assign or transfer any of its rights, duties, or obligations under this Agreement or the other Loan Documents without the prior written consent of Lender.
Section11.9Survival.
  All representations and warranties made in this Agreement or any other Loan Document or in any document, statement, or certificate furnished in connection with this Agreement shall survive the execution and delivery of this Agreement and the other Loan Documents, and no investigation by Lender or any closing shall affect the representations and warranties or the right of Lender to rely upon them. Without prejudice to the survival of any other obligation of Borrower hereunder, the obligations of Borrower under Sections 11.1, and 11.2 shall survive repayment of the Obligations and termination of the Commitment.
Section11.10Amendment.
  The provisions of this Agreement and the other Loan Documents to which Borrower is a party may be amended or waived only by an instrument in writing signed by the parties hereto.
Section11.11Notices.
  Unless otherwise expressly provided herein, all notices and other communications provided for hereunder shall be in writing (including by facsimile transmission) and mailed, faxed or delivered, to the address, facsimile number or subject to the last sentence hereof electronic mail address specified for notices below the signatures hereon or to such other address as shall be designated by such party in a notice to the other parties.  All such other notices and other communications shall be deemed to have been 
    44    Credit and Security Agreement

given or made upon the earliest to occur of (a) actual receipt by the intended recipient or (b)(i) if delivered by hand or courier, when signed for by the designated recipient; (ii) if delivered by mail, four (4) business days after deposit in the mail, postage prepaid; (iii) if delivered by facsimile, when sent; and (iv) if delivered by electronic mail (which form of delivery is subject to the provisions of the last sentence below), when delivered; provided, however, that notices and other communications pursuant to Section 2 shall not be effective until actually received by Lender.  Electronic mail and intranet websites may be used only to distribute routine communications, such as financial statements and other information, and to distribute Loan Documents for execution by the parties thereto, and may not be used for any other purpose.
Section11.12GOVERNING LAW; VENUE; SERVICE OF PROCESS.
  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS; PROVIDED THAT LENDER SHALL RETAIN ALL RIGHTS UNDER FEDERAL LAW.  THIS AGREEMENT HAS BEEN ENTERED INTO IN DALLAS COUNTY, TEXAS, AND IS PERFORMABLE FOR ALL PURPOSES IN DALLAS COUNTY, TEXAS.  THE PARTIES HEREBY AGREE THAT ANY LAWSUIT, ACTION, OR PROCEEDING THAT IS BROUGHT (WHETHER IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS, THE TRANSACTIONS CONTEMPLATED THEREBY, OR THE ACTIONS OF THE LENDER IN THE NEGOTIATION, ADMINISTRATION OR ENFORCEMENT OF ANY OF THE LOAN DOCUMENTS SHALL BE BROUGHT IN A STATE OR FEDERAL COURT OF COMPETENT JURISDICTION LOCATED IN DALLAS COUNTY, TEXAS.  BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY (A) SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS, (B) WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH LAWSUIT, ACTION, OR PROCEEDING BROUGHT IN ANY SUCH COURT, AND (C) FURTHER WAIVES ANY CLAIM THAT IT MAY NOW OR HEREAFTER HAVE THAT ANY SUCH COURT IS AN INCONVENIENT FORUM.  EACH OF THE PARTIES HERETO AGREE THAT SERVICE OF PROCESS UPON IT MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED AT THE ADDRESS FOR NOTICES REFERENCED IN SECTION 11.11 HEREOF.
Section11.13Counterparts.
  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Section11.14Severability.
  Any provision of this Agreement held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this Agreement and the effect thereof shall be confined to the provision held to be invalid or illegal.
Section11.15Headings.
  The headings, captions, and arrangements used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement.
Section11.16Participations; Etc.
  Lender shall have the right at any time and from time to time to grant participations in, and sell and transfer, the Obligations and any Loan Documents.  Each actual or proposed participant or assignee, as the case may be, shall be entitled to receive all information received by Lender regarding Borrower and the Obligated Parties, including, without limitation, information required to be disclosed to a participant or assignee pursuant to Banking Circular 181 (Rev., August 2, 1984), issued by the Comptroller of the Currency (whether the actual or proposed participant or assignee is subject to the circular or not).
Section11.17Construction.
    45    Credit and Security Agreement

  Borrower and Lender acknowledge that each of them has had the benefit of legal counsel of its own choice and has been afforded an opportunity to review this Agreement and the other Loan Documents with its legal counsel and that this Agreement and the other Loan Documents shall be construed as if jointly drafted by Borrower and Lender.
Section11.18Independence of Covenants.
  All covenants hereunder shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that it would be permitted by an exception to, or be otherwise within the limitations of, another covenant shall not avoid the occurrence of a Default or Event of Default if such action is taken or such condition exists.
Section11.19WAIVER OF JURY TRIAL
.  TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY OR THE ACTIONS OF LENDER IN THE NEGOTIATION, ADMINISTRATION, OR ENFORCEMENT THEREOF.  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 11.19.
Section11.20Additional Interest Provision.
  It is expressly stipulated and agreed to be the intent of Borrower and Lender at all times to comply strictly with the applicable law governing the maximum rate or amount of interest payable on the indebtedness evidenced by the Revolving Credit Note, any Loan Document, and the Related Indebtedness (or applicable United States federal law to the extent that it permits Lender to contract for, charge, take, reserve or receive a greater amount of interest than under applicable law).  If the applicable law is ever judicially interpreted so as to render usurious any amount (a) contracted for, charged, taken, reserved or received pursuant to the Revolving Credit Note, any of the other Loan Documents or any other communication or writing by or between Borrower and Lender related to the transaction or transactions that are the subject matter of the Loan Documents, (b) contracted for, charged, taken, reserved or received by reason of Lender’s exercise of the option to accelerate the maturity of the Revolving Credit Note and/or any and all indebtedness paid or payable by Borrower to Lender pursuant to any Loan Document other than the Revolving Credit Note (such other indebtedness being referred to in this Section as the “Related Indebtedness”), or (c) Borrower will have paid or Lender will have received by reason of any voluntary prepayment by Borrower of the Revolving Credit Note and/or the Related Indebtedness, then it is Borrower’s and Lender’s express intent that all amounts charged in excess of the Maximum Rate shall be automatically canceled, ab initio, and all amounts in excess of the Maximum Rate theretofore collected by Lender shall be credited on the principal balance of the Revolving Credit Note and/or the Related Indebtedness (or, if the Revolving Credit Note and all Related Indebtedness have been or would thereby be paid in full, refunded to Borrower), and the provisions of the Revolving Credit Note and the other Loan Documents shall immediately be deemed reformed and the amounts thereafter collectible hereunder and thereunder reduced, without the necessity of the execution of any new document, so as to comply with the applicable law, but so as to permit the recovery of the fullest amount otherwise called for hereunder and thereunder; provided, however, if the Revolving Credit Note or Related Indebtedness has been paid in full before the end of the stated term thereof, then Borrower and Lender agree that Lender shall, with reasonable promptness after Lender discovers or is advised by Borrower that interest was received in an amount in excess of the Maximum Rate, either refund such excess interest to Borrower and/or credit such excess interest against the Revolving Credit Note and/or any Related Indebtedness then owing by Borrower to Lender.  Borrower hereby agrees that as a condition precedent to any claim seeking 
    46    Credit and Security Agreement

usury penalties against Lender, Borrower will provide written notice to Lender, advising Lender in reasonable detail of the nature and amount of the violation, and Lender shall have sixty (60) days after receipt of such notice in which to correct such usury violation, if any, by either refunding such excess interest to Borrower or crediting such excess interest against the Revolving Credit Note to which the alleged violation relates and/or the Related Indebtedness then owing by Borrower to Lender.  All sums contracted for, charged, taken, reserved or received by Lender for the use, forbearance or detention of any debt evidenced by the Revolving Credit Note and/or the Related Indebtedness shall, to the extent permitted by applicable law, be amortized or spread, using the actuarial method, throughout the stated term of the Revolving Credit Note and/or the Related Indebtedness (including any and all renewal and extension periods) until payment in full so that the rate or amount of interest on account of the Revolving Credit Note and/or the Related Indebtedness does not exceed the Maximum Rate from time to time in effect and applicable to the Revolving Credit Note and/or the Related Indebtedness for so long as debt is outstanding.  In no event shall the provisions of Chapter 346 of the Texas Finance Code (which regulates certain revolving credit loan accounts and revolving triparty accounts) apply to the Revolving Credit Note and/or any of the Related Indebtedness.  Notwithstanding anything to the contrary contained herein or in any of the other Loan Documents, it is not the intention of Lender to accelerate the maturity of any interest that has not accrued at the time of such acceleration or to collect unearned interest at the time of such acceleration.
Section11.21Ceiling Election.
  To the extent that Lender is relying on Chapter 303 of the Texas Finance Code to determine the Maximum Rate payable on the Revolving Credit Note and/or any other portion of the Indebtedness, Lender will utilize the weekly ceiling from time to time in effect as provided in such Chapter 303.  To the extent United States federal law permits Lender to contract for, charge, take, receive or reserve a greater amount of interest than under Texas law, Lender will rely on United States federal law instead of such Chapter 303 for the purpose of determining the Maximum Rate.  Additionally, to the extent permitted by applicable law now or hereafter in effect, Lender may, at its option and from time to time, utilize any other method of establishing the Maximum Rate under such Chapter 303 or under other applicable law by giving notice, if required, to Borrower as provided by applicable law now or hereafter in effect.
Section11.22USA Patriot Act Notice.
  Lender hereby notifies Borrower that pursuant to the requirements of the Patriot Act and the Beneficial Ownership Regulation, it is required to obtain, verify and record information that identifies Borrower and each other Obligated Party, which information includes the name and address of Borrower and each other Obligated Party and other information that will allow Lender to identify Borrower and each other Obligated Party in accordance with the Patriot Act and the Beneficial Ownership Regulation.  In addition, Borrower agrees to (a) ensure that no Person who owns a controlling interest in or otherwise controls Borrower or any Subsidiary of Borrower is or shall be listed on the Specially Designated Nationals and Blocked Person List or other similar lists maintained by the OFAC, the Department of the Treasury or included in any Executive Order, (b) not to use or permit the use of proceeds of the Obligations to violate any of the foreign asset control regulations of the OFAC or any enabling statute or Executive Order relating thereto, and (c) comply, or cause its Subsidiaries to comply, with the applicable laws.
Section11.23NOTICE OF FINAL AGREEMENT.
  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.  
[Remainder of Page Intentionally Left Blank; Signature Page Follows]

    47    Credit and Security Agreement

EXECUTED to be effective as of the date first written above.
BORROWER:

loanDepot.com, LLC,
a Delaware limited liability company 

By:        
    Name:
    Title:

Address for Notices:
26642 Towne Centre Drive
Foothill Ranch, California 92610
Fax No.:
Telephone No.:  
Attention:
                        With a copy to:
26642 Towne Centre Drive
Foothill Ranch, California 92610
Fax No.: 
Telephone No.:  
Attention: 
    
LENDER:

NEXBANK

By:        
    Name: Rhett Miller
    Title: Senior Vice President and Chief Credit 
              Officer

Address for Notices:
2515 McKinney Avenue, Suite 1100
Dallas, Texas 75201
Telephone No.:  
Attention: 

Signature Page to Credit Agreement

SCHEDULE 4.1(a)(1)

None.

D-2294739_9.doc        Schedule 4.1(a) to Credit Agreement

SCHEDULE 4.1(a)(2)
PLEDGED SERVICING RIGHTS 

Delivered separately to NexBank
D-2294739_9.doc        Schedule 4.1(a) to Credit Agreement

SCHEDULE 5.1(r)
ADDITIONAL CONDITIONS PRECEDENT

None.
        Schedule 5.1(r) to Credit Agreement

SCHEDULE 6.2
EXISTING DEBT

See Attached.1

1 NTD: loanDepot to provide list of Existing Debt.
        Schedule 6.5 to Credit Agreement

SCHEDULE 6.5
LITIGATION AND JUDGMENTS

None.

        Schedule 6.5 to Credit Agreement

SCHEDULE 6.13
SUBSIDIARIES, VENTURES, ETC.
loanDepot Agency Advance Receivables Depositor, LLC
loanDepot BA Warehouse, LLC

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