ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT
THIS ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT (this “
Assignment ”), dated as of November 1, 2006, is
entered into among J.P. Morgan Acceptance Corporation I, a Delaware
corporation (the “ Depositor ”), HSBC Bank USA,
National Association, as trustee (the “ Trustee
”) of J.P. Morgan Alternative Loan Trust 2006-A7 (the “
Trust ”), J.P. Morgan Mortgage Acquisition Corp.
(“ JPMorgan Acquisition ”), Countrywide Home
Loans, Inc. (“ Countrywide ”), Countrywide Home
Loans Servicing LP (“Servicer”) and U.S. Bank National
Association (the “ Master Servicer
”).
RECITALS
WHEREAS JPMorgan
Acquisition and Countrywide have entered into a certain Amended and
Restated Master Mortgage Loan Purchase and Servicing Agreement,
dated as of December 1, 2005 (the “ Agreement
”), pursuant to which JPMorgan Acquisition has acquired
certain Mortgage Loans pursuant to the terms of the Agreement and
Countrywide has agreed to service such Mortgage
Loans;
WHEREAS Countrywide
has assigned the right to service such Mortgage Loans to the
Servicer and the Servicer has agreed to service such Mortgage
Loans;
WHEREAS the
Depositor has agreed, on the terms and conditions contained herein,
to purchase from JPMorgan Acquisition certain of the Mortgage Loans
(the “ Specified Mortgage Loans ”) which are
subject to the provisions of the Agreement and are listed on the
mortgage loan schedule attached as Exhibit I hereto (the “
Specified Mortgage Loan Schedule ”);
and
WHEREAS the Trustee,
on behalf of the Trust, has agreed, on the terms and conditions
contained herein, to purchase from the Depositor the Specified
Mortgage Loans;
NOW, THEREFORE, in
consideration of the mutual promises contained herein and other
good and valuable consideration (the receipt and sufficiency of
which are hereby acknowledged), the parties agree as
follows:
1.
Assignment and
Assumption
(a)
On and as of the
date hereof, JPMorgan Acquisition hereby sells, assigns and
transfers to the Depositor all of its right, title and interest in
the Specified Mortgage Loans and all rights and obligations related
thereto as provided under the Agreement to the extent relating to
the Specified Mortgage Loans, the Depositor hereby accepts such
assignment from JPMorgan Acquisition (the “ First
Assignment and Assumption ”), and Countrywide and the
Servicer hereby acknowledge the First Assignment and
Assumption.
JPMorgan Acquisition
specifically reserves and does not assign to the Depositor
hereunder any and all right, title and interest in, to and under
and all obligations of JPMorgan Acquisition with respect to any
Mortgage Loans subject to the Agreement which are not the Specified
Mortgage Loans.
(b)
On and as of the
date hereof, immediately after giving effect to the First
Assignment and Assumption, the Depositor hereby sells, assigns and
transfers to the Trustee, on behalf of the Trust, all of its right,
title and interest in the Specified Mortgage Loans and all rights
and obligations related thereto as provided under the Agreement to
the extent relating to the Specified Mortgage Loans, and the
Trustee, on behalf of the Trust, hereby accepts such assignment
from the Depositor (the “ Second Assignment and
Assumption ”), and Countrywide and the Servicer hereby
acknowledge the Second Assignment and Assumption.
(c)
On and as of the
date hereof, JPMorgan Acquisition represents and warrants to the
Depositor and the Trustee that JPMorgan Acquisition has not taken
any action that would serve to impair or encumber the respective
ownership interests of the Depositor and the Trustee in the
Specified Mortgage Loans since the date of JPMorgan
Acquisition’s acquisition of the Specified Mortgage
Loans.
2.
Recognition of
Trustee
(a)
From and after the
date hereof, both JPMorgan Acquisition and Countrywide shall note
the transfer of the Specified Mortgage Loans to the Trustee, in
their respective books and records and shall recognize the Trustee,
on behalf of the Trust, as of the date hereof, as the owner of the
Specified Mortgage Loans, and the Servicer shall service the
Specified Mortgage Loans for the benefit of the Trust pursuant to
the Agreement, the terms of which are incorporated herein by
reference. It is the intention of Countrywide, the Servicer
the Depositor, the Trustee and JPMorgan Acquisition that this
Assignment shall be binding upon and inure to the benefit of the
Depositor, the Trustee and JPMorgan Acquisition and their
respective successors and assigns.
(b)
Without in any way
limiting the foregoing, the parties confirm that this Assignment
includes the rights relating to amendments and waivers under the
Agreement. Accordingly, the right of JPMorgan Acquisition to
consent to any amendment of the Agreement and its rights concerning
waivers as set forth in Sections 8.14 and 8.17, respectively, of
the Agreement shall be exercisable, to the extent any such
amendment or waiver affects the Specified Mortgage Loans or any of
the rights or obligations under the Agreement with respect thereto
(including, without limitation, the servicing of the Specified
Mortgage Loans), by the Trustee as assignee of JPMorgan
Acquisition.
3.
Representations
and Warranties
(a)
The Depositor
represents and warrants that it is a sophisticated investor able to
evaluate the risks and merits of the transactions contemplated
hereby, and that it has not relied in connection therewith upon any
statements or representations of Countrywide or JPMorgan
Acquisition other than those contained in the Agreement or this
Assignment.
(b)
Each of the parties
hereto represents and warrants that it is duly and legally
authorized to enter into this Assignment.
(c)
Each of the parties
hereto represents and warrants that this Assignment has been duly
authorized, executed and delivered by it and (assuming due
authorization, execution and delivery thereof by each of the other
parties hereto) constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms,
except as such enforcement may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting the
enforcement of creditors’ rights generally and by general
equitable principles (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(d)
Countrywide hereby
restates, as of the Closing Date (as defined in the Pooling and
Servicing Agreement referred to below), the representations and
warranties contained in Section 3.01 of the Agreement (except with
respect to Section 3.01 (k)), to and for the benefit of the
Depositor, the Trustee and the Trust, and by this reference
incorporates such representations and warranties herein, as of such
Closing Date.
4.
The Servicer hereby
acknowledges that U.S. Bank National Association has been appointed
as the Master Servicer of the Specified Mortgage Loans pursuant to
the pooling and servicing agreement dated as of the date hereof
among the Depositor, the Master Servicer, the Securities
Administrator and the Trustee (the “Pooling and Servicing
Agreement”) for Mortgage Pass-Through Certificates, Series
2006-A7 and, therefore, has the right to enforce all obligations of
the Servicer under the Agreement. Such rights will include, without
limitation, the right to terminate the Servicer under the Agreement
upon the occurrence of an event of default thereunder, the right to
receive all remittances required to be made by the Servicer under
the Agreement and the Assignment, the right to receive all monthly
reports and other data required to be delivered by the Servicer
under the Agreement and the Assignment, the right to examine the
books and records of the Servicer, indemnification rights and the
right to exercise certain rights of consent and approval relating
to actions taken by JPMorgan Acquisition. Notwithstanding the
foregoing, it is understood that the Servicer shall not be
obligated to defend and indemnify and hold harmless the Master
Servicer, the Trust, the Trustee, the Depositor, and JP Morgan
Acquisition from and against any losses, damages, penalties, fines,
forfeitures, judgments and any related costs including, without
limitation, reasonable and necessary legal fees, resulting from
actions or inactions of the Servicer which were taken or omitted
upon the instruction or direction of the Master Servicer. The
Servicer shall make all distributions under the Agreement and the
Assignment to the Master Servicer by wire transfer of immediately
available funds to:
U.S. Bank National
Association
ABA
Number:
091000022
Account Name:
U.S. Bank Corporate Trust
Account number:
173103322058
For further credit
to:
J.P. Morgan
Alternative Loan Trust 2006-A7,
Distribution Account
Number: 107164000
The Servicer shall
deliver all reports required to be delivered under the Agreement
and the Assignment to the Master Servicer at the following
address:
U.S. Bank National
Association
2121 Cliff Drive,
#205
Eagan, MN
55122
Attention: J.P.
Morgan Alternative Loan Trust 2006-A7
Telecopier: (651)
365-6384
5.
Establishment of
Custodial Account
The Servicer shall
establish and maintain a separate Collection Account in the name of
the Trustee, in trust for J.P. Morgan Alternative Loan Trust
2006-A7, for all funds collected and received on the Specified
Mortgage Loans.
6.
Amendment to the
Agreement
The parties to the
Agreement hereby agree to amend the Agreement as
follows:
(a)
The definition of
“Qualified Substitute Mortgage Loan” under the
Agreement, solely with respect to the Specified Mortgage Loans, is
hereby amended by deleting such definition in its entirety and
replacing it with the following:
“A mortgage
loan that must, on the date of such substitution, (i) have an
unpaid principal balance, after deduction of all scheduled payments
due in the month of substitution (or if more than one (1) mortgage
loan is being substituted, an aggregate principal balance), not in
excess of the unpaid principal balance of the repurchased Mortgage
Loan and not less than ninety percent (90%) of the unpaid principal
balance of the repurchased Mortgage Loan (the amount of any
shortfall will be deposited in the Custodial Account by the
Servicer in the month of substitution); (ii) have a minimum
Mortgage Interest Rate not less than that of the repurchased
Mortgage Loan; (iii) have a maximum Mortgage Interest Rate not less
than that of the repurchased Mortgage Loan and not more than two
(2) percentage points above that of the repurchased Mortgage Loan;
(iv) have a remaining term to maturity not greater than, and not
more than one year less than, the maturity date of the repurchased
Mortgage Loan; (v) have a Gross Margin not less than that of the
repurchased Mortgage Loan; (vi) have a Periodic Rate Cap equal to
that of the repurchased Mortgage Loan; (vii) have an LTV at the
time of substitution equal to or less than the LTV of the
repurchased Mortgage Loan at the time of substitution; (viii) have
the same Interest Adjustment Date as that of the repurchased
Mortgage Loan; (ix) have the same Index as that of the repurchased
Mortgage Loan; (x) not permit conversion of the related Mortgage
Interest Rate to a permanent fixed Mortgage Interest Rate; (xi) be
the same type of Mortgage Loan (i.e., an Adjustable Rate Mortgage
Loan); and (xii) comply with each representation and warranty
(respecting individual Mortgage Loans) set forth in Section 3.02
hereof.”
(b)
Notwithstanding any
provision in the Agreement to the contrary, the parties to the
Agreement hereby agree that, in connection with any prepayments in
full of the Specified Mortgage Loans in a Mortgage Pool (as defined
in the Pooling and Servicing Agreement), Countrywide or the
Servicer shall contribute from its own funds, without reimbursement
therefor up to a maximum amount per month equal to the lesser of
one half of (a) one-twelfth of the product of (i) the Servicing Fee
Rate (as defined in the Agreement) and (ii) the stated principal
balance of such Specified Mortgage Loans, or (b) the aggregate
Servicing Fee actually received for such month for the Specified
Mortgage Loans in such Mortgage Pool, for any shortfall in the
interest component of such Specified Mortgage Loans such that one
month’s interest shall be deposited to the Custodial Account,
as defined in the Agreement.
7.
Indemnification
and Contribution
(a)
Countrywide shall
indemnify and hold harmless the Depositor, its officers and
directors and each person, if any, who controls the Depositor
within the meaning of either Section 15 of the Securities Act of
1933, as amended (the “ 1933 Act ”) or Section
20 of the Securities Exchange Act of 1934, as amended (the “
1934 Act ”) against any and all losses, claims,
damages or liabilities, joint or several, to which the Depositor or
any of them may become subject under the 1933 Act, the 1934 Act or
other federal or state statutory law or regulation, at common law
or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based in whole or in part upon (i) any untrue statement or alleged
untrue statement of a material fact contained in the Free-Writing
Prospectus and Prospectus Supplement (as hereafter defined) or any
omission or alleged omission to state in the Free-Writing
Prospectus and Prospectus Supplement a material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading,
but in each case to the extent, and only to the extent that such
untrue statement or alleged untrue statement or omission or alleged
omission was made in or omitted from the Countrywide Information
(as defined herein) and (ii) agree to reimburse the Depositor and
each such officer, director and controlling person promptly upon
demand for any legal or other expenses reasonably incurred by any
of them in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action
as such expenses are incurred. The foregoing indemnity
agreement is in addition to any liability which Countrywide may
otherwise have.
As used herein
“Countrywide Information” means the information
furnished in writing by Countrywide or the Servicer as set forth on
Exhibit II attached hereto, specifically for use in the
Free-Writing Prospectus of the Depositor (the “Free-Writing
Prospectus”) dated on or about November 1, 2006, relating to
the J.P. Morgan Alternative Loan Trust 2006-A7, Mortgage
Pass-Through Certificates (the “Certificates”), and the
Prospectus Supplement of the Depositor (the “Prospectus
Supplement” and together with the Free-Writing Prospectuses,
the “Offering Documents”) dated on or about November
28, 2006, relating to the J.P. Morgan Alternative Loan Trust
2006-A7, Mortgage Pass-Through Certificates (the
“Certificates”).
(b)
The Depositor and
JPMorgan Acquisition shall indemnify and hold harmless Countrywide
and the Servicer, their respective officers and directors and each
person, if any, who controls Countrywide and the Servicer within
the meaning of either Section 15 of the 1933 Act or Section 20 of
the 1934 Act, against any and all losses, claims, damages or
liabilities, joint or several, to which Countrywide and the
Servicer or any of them may become subject under the 1933 Act, the
1934 Act or other federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based in whole or in part upon any untrue statement or alleged
untrue statement of a material fact contained in the Offering
Documents or any omission or alleged omission to state in the
Offering Documents a material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, but in each
case to the extent, and only to the extent that such untrue
statement or alleged untrue statement or omission or alleged
omission was made in or omitted from the Depositor Information (as
defined herein), and agrees to reimburse Countrywide, the Servicer
and each such officer, director and controlling person promptly
upon demand for any legal or other expenses reasonably incurred by
any of them in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred. The foregoing
indemnity agreement is in addition to any liability which the
Depositor and JPMorgan Acquisition may otherwise
have.
As used herein
“ Depositor Information ” means all information
other than the Countrywide Information contained in the
Free-Writing Prospectus dated on or about November 1, 2006,
Prospectus Supplement dated on or about November 28, 2006, the
accompanying Prospectus dated on or about September 21, 2006, any
private placement memorandum relating to the privately offered
Certificates and any amendment or supplement to any of the
foregoing and any other materials used by the Depositor to offer
any of the Certificates.
(c)
Promptly after
receipt by any indemnified party under this Section 7 of notice of
any claim or the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 6, notify the indemnifying
party in writing of the claim or the commencement of that action;
provided, however, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have
under this Section 6 except to the extent it has been materially
prejudiced by such failure; and provided further, however, that the
failure to notify the indemnifying party shall not relieve it from
any liability which it may have to any indemnified party otherwise
than under this Section 7.
If any such claim or
action shall be brought against an indemnified party, and it shall
promptly notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel
reasonably satisfactory to the indemnified party. After
notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except as
provided in the following paragraph, the indemnifying party shall
not be liable to the indemnified party under this Section 7 for any
legal or other expenses subsequently incurred by the indemnified
party in connection with the defense thereof other than reasonable
costs of investigation.
Any indemnified
party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such
indemnified party unless: (i) the employment thereof has been
specifically authorized by the indemnifying party in writing; (ii)
such indemnified party shall have been advised by such counsel that
there may be one or more legal defenses available to it which are
different from or additional to those available to the indemnifying
party and in the reasonable judgment of such counsel it is
advisable for such indemnified party to employ separate counsel; or
(iii) the indemnifying party has failed to assume the defense of
such action and employ counsel reasonably satisfactory to the
indemnified party, in which case, if such indemnified party
notifies the indemnifying party in writing that it elects to employ
separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense
of such action on behalf of such indemnified party, it being
understood, however, the indemnifying party shall not, in
connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable for the
fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified
parties.
The indemnifying
party shall not be liable for any settlement of any such action
effected without its written consent (which consent shall not be
unreasonably withheld or delayed), but if settled with its written
consent or if there be a final judgment for the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold
harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.
Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have
requested the indemnifying party to reimburse the indemnified party
for fees and expenses of counsel, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding
effected without its written consent if such settlement is entered
into more than 30 days after receipt by such indemnifying party of
the aforesaid request or such lesser amount if time is required by
the settlement (as set forth in written notice).
(d)
If the
indemnification provided for in this Section 7 is unavailable to an
indemnified party or insufficient in respect of any losses, claims,
damages or liabilities referred to therein, then the indemnifying
party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages or liabilities, in such
proportion as is appropriate to reflect the relative fault of the
indemnifying party in connection with the statements or omissions
that result in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative fault
of the indemnifying party shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact is
contained in the Countrywide Information, on the one hand, or
Depositor Information on the other.
The amount paid or
payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in this Section 7(d) shall be
deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action
or claim, except where the indemnified party is required to bear
such expenses pursuant to this Section 7, which expenses the
indemnifying party shall pay as and when incurred, at the request
of the indemnified party, to the extent that the indemnifying party
will be ultimately obligated to pay such expenses. In the
event that any expenses so paid by the indemnifying party are
subsequently determined to not be required to be borne by the
indemnifying party hereunder, the party which received such payment
shall promptly refund the amount so paid to the party which made
such payment. No person guilty of fraudulent
misrepresentations (within the meaning of Section 11(f) of the 1933
Act), shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
(e)
The indemnity and
contribution agreements contained in this Section 7 shall remain
operative and in full force and effect regardless of (i) any
termination of the Agreement, (ii) any investigation made by any of
the Depositor or Countrywide, their directors or officers or any
person controlling any of them, by or on behalf of any them, and
(iii) acceptance of and payment for any of the
Certificates.
8.
Indemnification by
Master Servicer
The Master Servicer
shall indemnify and hold harmless Countrywide and its affiliates,
and in each case, its officers, directors and agents from and
against any losses, damages, penalties, fines, forfeitures,
reasonable legal fees and related costs, judgments and other costs
and expenses arising out of or based upon a breach by the Master
Servicer or any of its officers, directors, agents or affiliates of
its obligations in connection with the preparation, filing and
certification of any Form 10-K, Form 10-D or Form 8-K pursuant to
the Pooling and Servicing Agreement or the gross negligence of the
Master Servicer in connection therewith. In addition, the Master
Servicer shall indemnify and hold harmless Countrywide and its
affiliates, and in each case, its officers, directors and agents
from and against any losses, damages, penalties, fines,
forfeitures, reasonable legal fees and related costs, judgments and
other costs and expenses arising out of or based upon a breach by
any Servicer (as defined in the Pooling and Servicing Agreement),
other than Countrywide, of its obligations in connection with any
back-up certification (or any other back-up documents) to any
certification of any Form 10-K, Form 10-D or Form 8-K required to
be provided by the Master Servicer, but solely to the extent the
Master Servicer receives amounts from such Servicer in connection
with any indemnification provided by such Servicer (in each case as
defined in the Pooling and Servicing Agreement) to the Master
Servicer.
9.
Continuing
Effect
Except as
contemplated hereby, the Agreement shall remain in full force and
effect in accordance with its terms.
10.
Governing
Law
This Assignment and
the rights and obligations hereunder shall be governed by and
construed in accordance with the internal laws of the State of New
York.
11.
Notices
Any notices or other
communications permitted or required under the Agreement to be made
to the Depositor and the Trustee shall be made in accordance with
the terms of the Agreement and shall be sent to the Depositor and
Trustee as follows:
In the case of
JPMorgan Acquisition:
J.P. Morgan Mortgage
Acquisition Corp.
270 Park Avenue, 10th
Floor
New York, New York
10017
Attention: Seth
Fenton
Telephone: (212) 834
5463
Facsimile: (917)
464-8161
With a copy
to:
JPMorgan Chase &
Co.
270 Park
Avenue
New York, New York
10017
Attention: General
Counsel’s Office
In the case of the
Depositor:
J.P. Morgan
Acceptance Corporation I
270 Park
Avenue
New York, New York
10017
Attention: J.P.
Morgan Alternative Loan Trust 2006-A7
In the case of the
Trustee:
HSBC
Bank USA National Association
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