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Exhibit 99.1
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EXECUTION COPY
MORTGAGE LOAN PURCHASE AGREEMENT
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Purchaser
and
MERRILL LYNCH MORTGAGE LENDING, INC.
Seller
Dated as of August 1, 2007
Conventional Fixed Rate Mortgage Loans
Second Liens
Relating to
Merrill Lynch First Franklin Mortgage Loan Trust, Series 2007-A
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TABLE OF CONTENTS
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SECTION 1.
Definitions................................................
1
SECTION 2.
Purchase; Sale Treatment...................................
12
SECTION 3.
Final Mortgage Loan Schedules..............................
13
SECTION 4.
Purchase Price.............................................
13
SECTION 5.
Examination of Mortgage Files..............................
13
SECTION 6.
Conveyance from Seller to Initial Purchaser................
13
SECTION 7.
Representations, Warranties and Covenants of the Seller:
Remedies for Breach........................................
15
SECTION 8.
Closing....................................................
27
SECTION 9.
[Reserved].................................................
27
SECTION 10.
Costs......................................................
27
SECTION 11.
[Reserved].................................................
27
SECTION 12.
Removal of Mortgage Loans from Inclusion under This
Agreement Upon a Whole Loan Transfer or a Securitization on
One or More Reconstitution Dates...........................
41
SECTION 13. The
Seller.................................................
32
SECTION 14.
[Reserved].................................................
33
SECTION 15.
Termination................................................
41
SECTION 16.
Successor to the Seller....................................
41
SECTION 17.
Financial Statements.......................................
33
SECTION 18.
Mandatory Delivery; Grant of Security Interest.............
33
SECTION 19.
Notices....................................................
34
SECTION 20.
Severability Clause........................................
34
SECTION 21.
Counterparts...............................................
34
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SECTION 22.
Governing Law..............................................
34
SECTION 23.
Intention of the Parties...................................
34
SECTION 24.
Successors and Assigns.....................................
35
SECTION 25.
Waivers....................................................
35
SECTION 26.
Exhibits...................................................
35
SECTION 27.
Nonsolicitation............................................
35
SECTION 28.
General Interpretive Principles............................
35
SECTION 29.
Reproduction of Documents..................................
36
SECTION 30.
Further Agreements.........................................
36
SECTION 31.
Protection of Confidential Information.....................
36
SECTION 32.
Survival...................................................
37
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EXHIBITS
EXHIBIT 1 CONTENTS OF EACH
MORTGAGE FILE
SCHEDULE I
FINAL MORTGAGE LOAN SCHEDULE
SCHEDULE II
PREPAYMENT CHARGE SCHEDULE
ii
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MORTGAGE LOAN PURCHASE AGREEMENT
This
is a MORTGAGE LOAN PURCHASE AGREEMENT (the "Agreement"), dated as
of
August 1, 2007, by and between Merrill Lynch Mortgage Investors,
Inc., having an
office at 250 Vesey Street, 4 World Financial Center, 10th Floor,
New York, New
York 10080 (the "Initial Purchaser", and the Initial Purchaser or
the Person, if
any, to which the Initial Purchaser has assigned its rights and
obligations
hereunder as Purchaser with respect to a Mortgage Loan, and each of
their
respective successors and assigns, the "Purchaser") and Merrill
Lynch Mortgage
Lending, Inc., a Delaware corporation, and subsidiary of Merrill
Lynch Bank and
Trust Co., FSB (the "Seller"), having an office at 250 Vesey
Street, 4 World
Financial Center, 10th Floor, New York, New York 10080.
WITNESSETH:
WHEREAS, the Seller desires to sell to the Purchaser, and the
Purchaser desires to purchase from the Seller, certain conventional
fixed rate,
residential, second lien mortgage loans (the "Mortgage Loans") as
described
herein on a servicing-retained basis;
WHEREAS, each Mortgage Loan is secured by a mortgage, deed of trust
or
other security instrument creating a second lien on a residential
dwelling
located in the jurisdiction indicated on the Final Mortgage Loan
Schedule, which
is to be annexed hereto on the Closing Date as Schedule I;
WHEREAS, the Purchaser and the Seller wish to prescribe the manner
of
the conveyance, and control of the Mortgage Loans; and
WHEREAS, following its purchase of the Mortgage Loans from the
Seller,
the Purchaser desires to sell the Mortgage Loans in a public or
private
mortgage-backed securities transaction;
NOW, THEREFORE, in consideration of the premises and mutual
agreements
set forth herein, and for other good and valuable consideration,
the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the
Seller agree
as follows:
SECTION 1. Definitions. For purposes of this Agreement the
following
capitalized terms shall have the respective meanings set forth
below.
Agreement: This Mortgage Loan Purchase Agreement including all
exhibits, schedules, amendments and supplements hereto.
Appraised Value: With respect to any Mortgaged Property, the lesser
of
(i) the value thereof as determined by an appraisal made for the
originator of
the Mortgage Loan at the time of origination of the Mortgage Loan
by an
appraiser who met the minimum requirements of Fannie Mae and
Freddie Mac, or
pursuant to a value assigned by Seller's automated appraisal
methodology in
accordance with Seller's underwriting guidelines, and (ii) the
purchase price
paid for the related Mortgaged Property by the Mortgagor with the
proceeds of
the Mortgage Loan, provided, however, in the case of a Refinanced
Mortgage Loan,
such value of the Mortgaged Property is based solely upon the value
determined
by an appraisal made for the
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originator of such Refinanced Mortgage Loan at the time of
origination of such
Refinanced Mortgage Loan by an appraiser who met the minimum
requirements of
Fannie Mae and Freddie Mac, or pursuant to a value assigned by
Seller's
automated appraisal methodology in accordance with Seller's
underwriting
guidelines.
Assignment of Mortgage: An individual 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 give record notice of the sale of the Mortgage to the
Purchaser.
Balloon Loan: A Mortgage Loan identified on the Final Mortgage
Loan
Schedule as a balloon mortgage loan.
Business Day: Any day other than a Saturday or Sunday, or a day
on
which banking and savings and loan institutions in the State of
California or
the State of New York are authorized or obligated by law or
executive order to
be closed.
Buydown Mortgage Loan: A Mortgage Loan in which buydown funds are
used
to pay a portion of the interest payable on the Mortgage Loan for a
specified
period of time.
Closing Date: September 7, 2007.
Code: The Internal Revenue Code of 1986, or any successor
statute
thereto.
Combined Loan-to-Value Ratio or CLTV: With respect to any
Mortgage
Loan, the fraction, expressed as a percentage, the numerator of
which is the sum
of (a) the original principal balance of the Mortgage Loan, plus
(b) the unpaid
principal balance of any related senior mortgage loan or loans
secured by the
Mortgaged Property, and the denominator of which is the Appraised
Value of the
related Mortgaged Property.
Commission: The United States Securities and Exchange
Commission.
Condemnation Proceeds: All awards, compensation and settlements
in
respect of a taking of all or part of a Mortgaged Property by
exercise of the
power of condemnation or the right of eminent domain.
Credit Score: The credit score of the Mortgagor provided by an
organization providing credit scores at the time of the origination
of a
Mortgage Loan. If two credit scores are obtained, the Credit Score
shall be the
lower of the two credit scores. If three credit scores are
obtained, the Credit
Score shall be the middle of the three credit scores.
Custodial Account: One or more accounts that shall be held as a
special deposit by the depository institution maintaining such
accounts in a
fiduciary capacity, separate and apart from its funds or general
assets and
shall not be held in any capacity that would create a
debtor-creditor
relationship between the depository institution maintaining the
accounts and the
Seller or Purchaser.
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Custodial Agreement: The agreement between the Initial Purchaser
and
the Custodian, governing the retention of the originals of the
Mortgage Loan
Documents.
Custodian: The custodian designated by the Initial Purchaser under
the
Custodial Agreement, or its successor in interest or assigns, or
any successor
to the Custodian under the Custodial Agreement.
Cut-off Date: August 1, 2007.
Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced
by a
Qualified Substitute Mortgage Loan.
Depositor: The depositor, as such term is defined in Regulation
AB,
with respect to any Securitization Transaction.
Due Date: With respect to each Remittance Date, the first day of
the
calendar month in which such Remittance Date occurs, which is the
day on which
the Monthly Payment is due on a Mortgage Loan, exclusive of any
days of grace.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Fannie Mae: Fannie Mae or any successor thereto.
FDIC: The Federal Deposit Insurance Corporation, or any
successor
thereto.
Final Mortgage Loan Schedule: The schedule of Mortgage Loans to
be
annexed hereto as Schedule I (or a supplement thereto) on the
Closing Date in
both hard copy and floppy disk, such schedule setting forth the
following
information with respect to each Mortgage Loan in the Mortgage Loan
Package:
(1) the Seller's
Mortgage Loan identifying number;
(2) the Mortgagor's
first and last name;
(3) the street address
of the Mortgaged Property including the state
and zip code;
(4) a code indicating
whether the Mortgaged Property is
owner-occupied;
(5) the type of
Residential Dwelling constituting the Mortgaged
Property;
(6) the original
months to maturity;
(7) the original date
of the Mortgage Loan and the remaining months
to
maturity from the Cut-off Date, based on the original
amortization schedule;
(8) the Loan-to-Value
Ratio at origination;
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(9) the Mortgage
Interest Rate in effect immediately following the
Cut-off Date;
(10) the date on which the first Monthly Payment was due on the
Mortgage Loan;
(11) the stated maturity date;
(12) the amount of the Monthly Payment at origination;
(13) the amount of the Monthly Payment as of the Cut-off Date;
(14) the last Due Date on which a Monthly Payment was actually
applied
to the unpaid Stated Principal Balance;
(15) the original principal amount of the Mortgage Loan;
(16) the Stated Principal Balance of the Mortgage Loan as of the
close
of business on the Cut-off Date;
(17) a code indicating the purpose of the loan (i.e., purchase
financing, rate/term
refinancing, cash-out refinancing);
(18) the Mortgage Interest Rate;
(19) a code indicating the documentation style (i.e., full,
alternative or reduced);
(20) a code indicating if the Mortgage Loan is subject to a
Primary
Insurance Policy;
(21) a code indicating whether the Mortgage Loan is a Buydown
Mortgage
Loan;
(22) a code indicating the product type of the Mortgage Loan;
(23) a code indicating whether the Mortgage Loan is subject to
a
Prepayment Charge and the term of such Prepayment Charge;
(24) the Appraised Value of the Mortgaged Property;
(25) the sale price of the Mortgaged Property, if applicable;
(26) the Credit Score of the Mortgagor;
(27) the Mortgagor's debt to income ratio;
(28) the risk grade for each Mortgage Loan;
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(29) points at origination, described in the aggregate;
(30) a code indicating whether the borrower is self-employed;
(44) the Mortgagor's monthly disposable income;
(45) the number of months from disposition of bankruptcy (use "999"
to
indicate no bankruptcy);
(46) the number of months from disposition of foreclosure (use
"999"
to indicate no foreclosure);
(47) the Combined Loan-to-Value Ratio;
(48) the original balance on any mortgage loan senior in priority
to
the Mortgage Loan;
(49) the Mortgagor's social security number; and
(50) the type of appraisal performed on the Mortgaged Property.
With respect to the Mortgage Loans in the aggregate, the Final
Mortgage Loan
Schedule shall set forth the following information, as of the
Cut-off Date:
(1) the number of
Mortgage Loans;
(2) the current
principal balance of the Mortgage Loans;
(3) the weighted
average Mortgage Interest Rate of the Mortgage
Loans; and
(4) the weighted
average maturity of the Mortgage Loans.
First Lien: With respect to each Mortgaged Property, the lien of
the
mortgage, deed of trust or other instrument securing a Mortgage
Note which
creates a first lien on the Mortgaged Property.
Freddie Mac: The Federal Home Loan Mortgage Corporation or any
successor thereto.
HOEPA: The Home Ownership and Equity Protection Act of 1994 and
its
implementing regulations, including 12 CFR Section 226.32(a)(1)(i)
and (ii).
Initial Purchaser: Merrill Lynch Mortgage Investors, Inc., or
any
successor.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds
of
insurance policies insuring the Mortgage Loan or the related
Mortgaged Property.
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Liquidation Proceeds: Amounts, other than Insurance Proceeds
and
Condemnation Proceeds, received in connection with the liquidation
of a
defaulted Mortgage Loan through trustee's sale, foreclosure sale or
otherwise.
MERS: Mortgage Electronic Registration Systems, Inc., a
corporation
organized and existing under the laws of the State of Delaware, or
any successor
thereto.
MERS Loan: Any Mortgage Loan registered with MERS on the MERS
System.
MERS System: The system of recording transfers of mortgages
electronically maintained by MERS.
MIN: The Mortgage Identification Number for any MERS Loan.
MOM Loan: Any Mortgage Loan as to which MERS is acting as
mortgagee,
solely as nominee for the originator of such Mortgage Loan and its
successors
and assigns.
Monthly Payment: With respect to any Mortgage Loan, the
scheduled
combined payment of principal and interest payable by a Mortgagor
under the
related Mortgage Note on each Due Date.
Moody's: Moody's Investors Service, Inc. or its successor in
interest.
Mortgage: The mortgage, deed of trust or other instrument creating
a
second on Mortgaged Property securing the Mortgage Note.
Mortgagee: The mortgagee or beneficiary named in the Mortgage and
the
successors and assigns of such mortgagee or beneficiary.
Mortgage File: The items pertaining to a particular Mortgage
Loan
referred to in Exhibit 1 annexed hereto, and any additional
documents required
to be added to the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: With respect to each Mortgage Loan, the
fixed
annual rate of interest provided for in the related Mortgage
Note.
Mortgage Loan: Each second lien, residential mortgage loan,
sold,
assigned and transferred to the Purchaser pursuant to this
Agreement and
identified on the Final Mortgage Loan Schedule annexed to this
Agreement on the
Closing Date, which Mortgage Loan includes without limitation the
Mortgage File,
the Monthly Payments, Principal Prepayments, Liquidation Proceeds,
Condemnation
Proceeds, Insurance Proceeds, and all other rights, benefits,
proceeds and
obligations arising from or in connection with such Mortgage
Loan.
Mortgage Loan Documents: The following documents:
(1) The original Mortgage Note endorsed, "Pay to the order of
______________, without recourse" and signed in the name of the
Seller by
an
authorized officer of the Seller, together with all riders thereto.
The
Mortgage Note shall
6
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include all intervening endorsements showing a complete chain of
the title
from
the originator of the Mortgage Loan to [____________________];
(2) Except as provided below and for each Mortgage Loan that is not
a
MERS
Loan, the original recorded Mortgage together with all riders
thereto,
with
evidence of recording thereon, or, if the original Mortgage has
not
yet
been returned from the recording office, a copy of the original
Mortgage together with all riders thereto certified to be a true
copy of
the
original of the Mortgage that has been delivered for recording in
the
appropriate recording office of the jurisdiction in which the
Mortgaged
Property is located and in the case of each MERS Loan, the
original
Mortgage together with all riders thereto, noting the presence of
the MIN
of
the Mortgage Loan and either language indicating that the Mortgage
Loan
is a
MOM Loan or if the Mortgage Loan was not a MOM Loan at
origination,
the
original Mortgage and the assignment thereof to MERS, with evidence
of
recording indicated thereon, or a copy of the Mortgage certified by
the
public recording office in which such Mortgage has been
recorded;
(3) In the case of each Mortgage Loan that is not a MERS Loan,
the
original Assignment of Mortgage, executed in blank. If the Mortgage
Loan
was
acquired by the Seller in a merger or other type of acquisition,
the
assignment must be by "[Seller], successor [by merger to or in
interest to,
as
applicable] [name of predecessor]"; and in the event that the
Mortgage
Loan
was acquired or originated by the Seller while doing business
under
another name, the assignment must be by "[Seller], successor in
interest to
[previous name]";
(4) The original policy of title insurance (or a preliminary
title
report, commitment or binder if the original title insurance policy
has not
been
received from the title insurance company);
(5) Originals of any intervening assignments of the Mortgage,
with
evidence of recording thereon or, if the original intervening
assignment
has
not yet been returned from the recording office, a copy of such
assignment certified to be a true copy of the original of the
assignment
which has been sent for recording in the appropriate jurisdiction
in which
the
Mortgaged Property is located;
(6) With respect to a Mortgage Loan that, according to the
Final
Mortgage Loan Schedule is covered by a primary mortgage insurance
policy,
the
original or a copy of the policy of primary mortgage insurance;
(7) Originals of all assumption and modification agreements, if
any;
and
(8) If in connection with any Mortgage Loan, the Seller cannot
deliver
the
Mortgage, Assignments of Mortgage or assumption, consolidation
or
modification, as the case may be, with evidence of recording
thereon, if
applicable, concurrently with the execution and delivery of this
Agreement
solely because of a delay caused by the public recording office
where such
Mortgage, Assignments of Mortgage or assumption, consolidation
or
modification, as the case may be, has been delivered for
recordation, the
Seller shall deliver or cause to be delivered to the Purchaser
written
notice stating that
7
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such
Mortgage or assumption, consolidation or modification, as the case
may
be,
has been delivered to the appropriate public recording office
for
recordation. Thereafter, the Seller shall deliver or cause to be
delivered
to
the Purchaser such Mortgage, Assignments of Mortgage or
assumption,
consolidation or modification, as the case may be, with evidence
of
recording indicated thereon, if applicable, upon receipt thereof
from the
public recording office. To the extent any required endorsement is
not
contained on a Mortgage Note or an Assignment of Mortgage, the
Seller shall
make
or cause to be made such endorsement.
Mortgage Note: The original executed note or other evidence of
the
Mortgage Loan indebtedness of a Mortgagor.
Mortgaged Property: The Mortgagor's real property securing
repayment
of a related Mortgage Note, consisting of a fee simple interest or
leasehold
interest in a single parcel of real property improved by a
Residential Dwelling.
Mortgagor: The obligor on a Mortgage Note, the owner of the
Mortgaged
Property and the grantor or mortgagor named in the related Mortgage
and such
grantor's or mortgagor's successor's in title to the Mortgaged
Property.
Officer's Certificate: A certificate signed by the Chairman of
the
Board or the Vice Chairman of the Board or a President or a Vice
President and
by the Treasurer or the Secretary or one of the Assistant
Treasurers or
Assistant Secretaries of the Person on behalf of whom such
certificate is being
delivered.
Opinion of Counsel: A written opinion of counsel, who may be
salaried
counsel for the Person on behalf of whom the opinion is being
given, reasonably
acceptable to each Person to whom such opinion is addressed.
Originator: First Franklin Financial Corporation.
Person: An individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company,
trust,
unincorporated organization or government or any agency or
political subdivision
thereof.
Pooling and Servicing Agreement: The pooling and servicing
agreement,
dated as of August 1, 2007, by and among Merrill Lynch Mortgage
Investors, Inc.,
as depositor, Home Loan Services, Inc., as servicer, and LaSalle
Bank National
Association, as trustee.
Prepayment Charge: With respect to any Mortgage Loan, the
premiums,
fees, or charges, if any, due in connection with a full or partial
prepayment of
such Mortgage Loan in accordance with the terms thereof.
Prepayment Charge Schedule: As of any date, the information on
Prepayment Charges on the Final Mortgage Loan Schedule on such date
together
with the matrix of Prepayment Charge information prepared by the
Seller which is
attached hereto as Schedule II. The Prepayment Charge Schedule
shall be prepared
by the Seller and shall allow the identification of the following
information
with respect to each Prepayment Charge:
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(i) the Mortgage Loan
identifying number;
(ii) the type of Prepayment Charge;
(iii) the state of origination of the related Mortgage Loan;
(iv)
the date on which the first monthly payment was due on the
related Mortgage Loan;
(v) the term of the
related Prepayment Charge;
(vi) the original principal balance of the related Mortgage Loan;
and
(vii) the principal
balance of the related Mortgage Loan as of the
Cut-off Date.
The Prepayment Charge Schedule shall be amended if necessary by the
Seller and a
copy of such amended Prepayment Charge Schedule shall be furnished
by the Seller
to the Purchaser or its designees.
Primary Insurance Policy: A policy of primary mortgage guaranty
insurance issued by a Qualified Insurer.
Principal Prepayment: Any payment or other recovery of principal on
a
Mortgage Loan which is received in advance of its scheduled Due
Date, including
any Prepayment Charge, which is not accompanied by an amount of
interest
representing scheduled interest due on any date or dates in any
month or months
subsequent to the month of prepayment.
Purchase Price: The price paid on the Closing Date by the Purchaser
to
the Seller in exchange for the Mortgage Loans purchased on the
Closing Date as
calculated as provided in Section 4.
Qualified Correspondent: Any Person from which the Seller
purchased
Mortgage Loans, provided that the following conditions are
satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the
Seller and
such Person that contemplated that such Person would underwrite
mortgage loans
for sale to the Seller, in accordance with underwriting guidelines
designated by
the Seller ("Designated Guidelines") or guidelines that do not vary
materially
from such Designated Guidelines; (ii) such Mortgage Loans were in
fact
underwritten as described in clause (i) above and were acquired by
the Seller
within 180 days after origination; (iii) either (x) the Designated
Guidelines
were, at the time such Mortgage Loans were originated, used by the
Seller in
origination of mortgage loans of the same type as the Mortgage
Loans for the
Seller's own account or (y) the Designated Guidelines were, at the
time such
Mortgage Loans were underwritten, designated by the Seller on a
consistent basis
for use by lenders in originating mortgage loans to be purchased by
the Seller;
and (iv) the Seller employed, at the time such Mortgage Loans were
acquired by
the Seller, pre-purchase or post-purchase quality assurance
procedures (which
may involve, among other things, review of a sample of mortgage
loans purchased
during a particular time period or through particular channels)
designed to
ensure that Persons from which it purchased mortgage loans properly
applied the
underwriting criteria designated by the Seller. For the avoidance
of doubt, a
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"Qualified Correspondent" includes a "table broker" or mortgage
lender that
originates loans underwritten and funded by the Seller or an
Affiliate of the
Seller.
Qualified Insurer: Any insurer which meets the requirements of
Fannie
Mae and Freddie Mac.
Qualified Substitute Mortgage Loan: A mortgage loan substituted for
a
Deleted Mortgage Loan pursuant to the terms of this Agreement which
must, on the
date of such substitution, (i) have an outstanding principal
balance, after
application of all scheduled payments of principal and interest due
during or
prior to the month of substitution, not in excess of the Stated
Principal
Balance of the Deleted Mortgage Loan as of the Due Date in the
calendar month
during which the substitution occurs, (ii) have a Mortgage Interest
Rate not
less than (and not more than one percentage point in excess of) the
Mortgage
Interest Rate of the Deleted Mortgage Loan, (iii) have a net
Mortgage Interest
Rate not less than (and not more than one percentage point in
excess of) the net
Mortgage Interest Rate of the Deleted Mortgage Loan, (iv) have a
remaining terms
to maturity not greater than (and not more than one year less than)
that of the
Deleted Mortgage Loan, (v) have the same Due Date as the Due Date
on the Deleted
Mortgage Loan, (vi) have a Combined Loan-to-Value Ratio as of the
date of
substitution equal to or lower than the Combined Loan-to-Value
Ratio of the
Deleted Mortgage Loan as of such date, (vii) conform to each
representation and
warranty set forth in Subsection 7.02 of this Agreement and (viii)
be the same
type of mortgage loan (i.e. fixed rate). In the event that one or
more mortgage
loans are substituted for one or more Deleted Mortgage Loans, the
amounts
described in clause (i) hereof shall be determined on the basis of
aggregate
principal balances, the Mortgage Interest Rates described in clause
(ii) hereof
shall be determined on the basis of weighted average Mortgage
Interest Rates,
the Mortgage Rates described in clause (iii) hereof shall be
satisfied as to
each such mortgage loan, the terms described in clause (iv) shall
be determined
on the basis of weighted average remaining terms to maturity, the
Combined
Loan-to-Value Ratios described in clause (vi) hereof shall be
satisfied as to
each such mortgage loan and, except to the extent otherwise
provided in this
sentence, the representations and warranties described in clause
(viii) hereof
must be satisfied as to each Qualified Substitute Mortgage Loan or
in the
aggregate, as the case may be.
Reconstitution: Any Securitization Transaction or Whole Loan
Transfer.
Refinanced Mortgage Loan: A Mortgage Loan the proceeds of which
were
not used to purchase the related Mortgaged Property.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation
AB), 17 C.F.R. Sections 229.1100-229.1123, as such may be amended
from time to
time, and subject to such clarification and interpretation as have
been provided
by the Commission in the adopting release (Asset-Backed Securities,
Securities
Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005))
or by the
staff of the Commission, or as may be provided by the Commission or
its staff
from time to time.
REMIC: A "real estate mortgage investment conduit" within the
meaning
of Section 860D of the Code.
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Remittance Date: The eighteenth (18th) day of each month,
commencing
on the eighteenth day of the month next following the month in
which the Cut-off
Date occurs, or if such eighteenth (18th) day is not a Business
Day, the first
Business Day immediately following such eighteenth (18th) day.
Repurchase Price: With respect to any Mortgage Loan, the price
for
such repurchase shall be equal to par, multiplied by the
outstanding principal
balance of the Mortgage Loan to be repurchased as of the date of
the repurchase,
plus accrued interest thereon at the Mortgage Interest Rate on the
Mortgage Loan
from the last paid installment date through the last day of the
month in which
such repurchase occurs. The Repurchase Price shall also include any
costs and
damages incurred by the Purchaser or any assignee of the Purchaser
in connection
with any violation by the repurchased Mortgage Loan of any
representation or
warranty.
Residential Dwelling: Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling,
(iii) a
one-family dwelling unit in a condominium project which meets the
eligibility
requirements of the Seller, or (iv) a detached one-family dwelling
in a planned
unit development, none of which is a cooperative, mobile or
manufactured home.
Second Lien: With respect to each Mortgaged Property, the lien of
the
mortgage, deed of trust or other instrument securing a Mortgage
Note which
creates a second lien on the Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction: Any transaction involving either (1)
a
sale or other transfer of some or all of the Mortgage Loans
directly or
indirectly to an issuing entity in connection with an issuance of
publicly
offered or privately placed, rated or unrated mortgage-backed
securities or (2)
an issuance of publicly offered or privately placed, rated or
unrated
securities, the payments on which are determined primarily by
reference to one
or more portfolios of residential mortgage loans consisting, in
whole or in
part, of some or all of the Mortgage Loans.
Seller Information: As defined in Section 12.05(a).
Servicing File: With respect to each Mortgage Loan, the file
retained
by the Seller consisting of originals of all documents in the
Mortgage File
which are not delivered to the Purchaser or the Custodian and
copies of the
Mortgage Loan Documents.
S&P: Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.
or its successor in interest.
Stated Principal Balance: As to each Mortgage Loan as of any date
of
determination, (i) the principal balance of the Mortgage Loan as of
the Cut-off
Date after giving effect to payments of principal received on or
before such
date, minus (ii) all amounts previously distributed to the
Purchaser with
respect to the related Mortgage Loan representing payments or
recoveries of
principal.
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Static Pool Information: Static pool information as described in
Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Third-Party Originator: Each Person, if any, other than a
Qualified
Correspondent, that originated Mortgage Loans acquired by the
Seller and shall
not include a mortgage broker that does not fund loans.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans by the Purchaser to a third party, which sale or
transfer is not
a Securitization Transfer.
SECTION 2. Purchase Sale Treatment.
(a) The Seller does hereby sell, and the Purchaser does hereby
purchase Mortgage Loans having an aggregate principal balance on
the Cut-off
Date of $144,043,639.58. The obligation of the Purchaser to
purchase any
Mortgage Loan from the Seller on the Closing Date shall be subject
to the
satisfaction of the conditions precedent to the Purchaser's
obligation to
purchase set forth in Section 8. The Purchase Price and additional
amounts set
forth in Section 4 will be paid with proceeds of the related
Securitization
Transaction.
(b) The closing of the purchase and sale of the Mortgage Loans
shall
take place on the Closing Date at the office of the Purchaser's
counsel in New
York, New York or such other place as the parties shall agree.
(c) It is the express intent of the parties hereto that the
conveyance
of the Mortgage Loans by the Seller to the Purchaser, as
contemplated by this
Agreement be, and be treated as, a sale. It is, further, not the
intention of
the parties that such conveyance be deemed a pledge of the Mortgage
Loans by the
Seller to the Purchaser to secure a debt or other obligation of the
Seller.
However, in the event that, notwithstanding the intent of the
parties, the
Mortgage Loans are held by a court of competent jurisdiction to
continue to be
property of the Seller, then (i) this Agreement shall also be
deemed to be a
security agreement within the meaning of Articles 8 and 9 of the
applicable
Uniform Commercial Code; (ii) the transfer of the Mortgage Loans
provided for
herein shall be deemed to be a grant by the Seller to the Purchaser
of a
security interest in all of the Seller's right, title and interest
in and to the
Mortgage Loans and all amounts payable to the holders of the
Mortgage Loans in
accordance with the terms thereof and all proceeds of the
conversion, voluntary
or involuntary, of the foregoing into cash, instruments, securities
or other
property, to the extent the Purchaser would otherwise be entitled
to own such
Mortgage Loans and proceeds, including all amounts, other than
investment
earnings, from time to time held or invested in any accounts
created pursuant to
the Pooling and Servicing Agreement, whether in the form of cash,
instruments,
securities or other property; (iii) the possession by the Purchaser
or the
Trustee of Mortgage Notes and such other items of property as
constitute
instruments, money, negotiable documents or chattel paper shall be
deemed to be
"possession by the secured party" for purposes of perfecting the
security
interest pursuant to Section 9-305 (or comparable provision) of the
applicable
Uniform Commercial Code; and (iv) notifications to persons holding
such
property, and acknowledgments, receipts or confirmations from
persons holding
such property, shall be deemed notifications to, or
acknowledgments, receipts or
confirmations from, financial intermediaries, bailees or agents (as
applicable)
of the Purchaser for the purpose of perfecting such security
interest under
applicable law. Any
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assignment of the interest of the Purchaser pursuant to any
provision hereof or
pursuant to the Pooling and Servicing Agreement shall also be
deemed to be an
assignment of any security interest created hereby. The Seller and
the Purchaser
shall, to the extent consistent with this Agreement, take such
actions as may be
reasonably necessary to ensure that, if this Agreement were deemed
to create a
security interest in the Mortgage Loans, such security interest
would be deemed
to be a perfected security interest of first priority under
applicable law and
will be maintained as such throughout the term of the Pooling and
Servicing
Agreement.
SECTION 3. Final Mortgage Loan Schedule. The Seller shall deliver
the
Final Mortgage Loan Schedule at least one (1) Business Day prior to
the Closing
Date.
SECTION 4. Purchase Price. The Purchase Price for each Mortgage
Loan
listed on the Final Mortgage Loan Schedule shall be the Stated
Principal Balance
thereof as of the Cut-off Date.
In addition to the Purchase Price as described above, the
Initial
Purchaser shall pay to the Seller, at closing, accrued interest on
the Stated
Principal Balance of each Mortgage Loan as of the Cut-off Date at
the Mortgage
Interest Rate from the Cut-off Date through the day prior to the
Closing Date,
both inclusive.
The Purchaser shall own and be entitled to receive with respect
to
each Mortgage Loan purchased, (1) all recoveries of principal
collected after
the Cut-off Date and (2) all payments of interest on the Mortgage
Loans due
after the Cut-Off Date.
SECTION 5. Examination of Mortgage Files. In addition to the
rights
granted to the Initial Purchaser to underwrite the Mortgage Loans
and review the
Mortgage Files prior to the Closing Date, prior to the Closing
Date, the Seller
shall (a) deliver to the Custodian in escrow, for examination with
respect to
each Mortgage Loan to be purchased on the Closing Date, the related
Mortgage
File, including the Assignment of Mortgage, pertaining to each
Mortgage Loan, or
(b) make the related Mortgage File available to the Initial
Purchaser for
examination at the Seller's offices or such other location as shall
otherwise be
agreed upon by the Initial Purchaser and the Seller. Such
examination may be
made by the Initial Purchaser or its designee at any reasonable
time before or
after the Closing Date. If the Initial Purchaser makes such
examination prior to
the Closing Date and identifies any Mortgage Loans that do not
conform to the
Seller's underwriting standards, such Mortgage Loans may, at the
Initial
Purchaser's option, be rejected for purchase by the Initial
Purchaser. If not
purchased by the Initial Purchaser, such Mortgage Loans shall be
deleted from
the Final Mortgage Loan Schedule and may be replaced by a Qualified
Substitute
Mortgage Loan pursuant to Section 7. The Initial Purchaser may, at
its option
and without notice to the Seller, purchase all or part of the
Mortgage Loans
without conducting any partial or complete examination. The fact
that the
Initial Purchaser has conducted or has determined not to conduct
any partial or
complete examination of the Mortgage Files shall not affect the
Initial
Purchaser's (or any of its successors') rights to demand repurchase
or other
relief or remedy provided for in this Agreement.
SECTION 6. Conveyance from Seller to Initial Purchaser.
Subsection 6.01 Conveyance of Mortgage Loans; Possession of
Servicing
Files.
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The Servicing File retained by the Seller with respect to each
Mortgage Loan pursuant to this Agreement shall be appropriately
identified in
the Seller's computer system to reflect clearly the sale of such
related
Mortgage Loan to the Purchaser. The Seller shall release from its
custody the
contents of any Servicing File retained by it only in accordance
with this
Agreement, except when such release is required in connection with
a repurchase
of any such Mortgage Loan pursuant to Subsection 7.03 or 7.04.
In addition, in connection with the assignment of any MERS Loan,
the
Seller agrees that on or prior to the Closing Date it will cause,
at its own
expense, the MERS System to indicate that the related Mortgage
Loans have been
assigned by the Seller to the Purchaser in accordance with this
Agreement by
including in such computer files the information required by the
MERS System to
identify the Purchaser as owner of such Mortgage Loans.
Subsection 6.02 Books and Records.
Record title to each Mortgage and the related Mortgage Note as of
the
Closing Date shall be in the name of the Seller, the Purchaser, the
Custodian or
one or more designees of the Purchaser, as the Purchaser shall
designate.
Notwithstanding the foregoing, beneficial ownership of each
Mortgage and the
related Mortgage Note shall be vested solely in the Purchaser or
the appropriate
designee of the Purchaser, as the case may be. All rights arising
out of the
Mortgage Loans including, but not limited to, all funds received by
the Seller
after the Cut-off Date on or in connection with a Mortgage Loan as
provided in
Section 4 shall be vested in the Purchaser or one or more designees
of the
Purchaser; provided, however, that all such funds received on or in
connection
with a Mortgage Loan as provided in Section 4 shall be received and
held by the
Seller in trust for the benefit of the Purchaser or the assignee of
the
Purchaser, as the case may be, as the owner of the Mortgage Loans
pursuant to
the terms of this Agreement.
It is the express intention of the parties that the
transactions
contemplated by this Agreement be, and be construed as, a sale of
the Mortgage
Loans by the Seller and not a pledge of the Mortgage Loans by the
Seller to the
Purchaser to secure a debt or other obligation of the Seller.
Consequently, the
sale of each Mortgage Loan shall be reflected as a sale on the
Seller's business
records, tax returns and financial statements.
Subsection 6.03 Delivery of Mortgage Loan Documents.
The Seller shall from time to time in connection with the
Closing
Date, at least five (5) Business Days prior to the Closing Date or
such other
date as is mutually agreed to by the parties hereto, deliver and
release to the
Custodian the Mortgage Loan Documents with respect to each Mortgage
Loan to be
purchased and sold on the Closing Date and set forth on the Final
Mortgage Loan
Schedule delivered with such Mortgage Loan Documents.
The Custodian shall certify its receipt of all such Mortgage
Loan
Documents for the Closing Date, pursuant to an initial custody
receipt and
initial certification of the Custodian.
The Seller shall forward to the Custodian original documents
evidencing an assumption, modification, consolidation or extension
of any
Mortgage Loan entered into in accordance with this Agreement within
two weeks of
their execution, provided, however, that the
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Seller shall provide the Custodian with a certified true copy of
any such
document submitted for recordation within two weeks of its
execution, and shall
provide the original of any document submitted for recordation or a
copy of such
document certified by the appropriate public recording office to be
a true and
complete copy of the original within one hundred twenty (120) days
of its
submission for recordation.
SECTION 7. Representations, Warranties and Covenants of the
Seller:
Remedies for Breach.
Subsection 7.01 Representations and Warranties Respecting the
Seller.
The Seller represents, warrants and covenants to the Purchaser as
of
the date hereof and as of the Closing Date or as of such date
specifically
provided herein:
(1) The Seller is duly organized, validly existing and in good
standing under the laws of the state of Delaware and is and will
remain in
compliance with the laws of each state in which any Mortgaged
Property is
located to the extent necessary to ensure the enforceability of
each Mortgage
Loan and the servicing of the Mortgage Loan in accordance with the
terms of this
Agreement. No licenses or approvals obtained by the Seller have
been suspended
or revoked by any court, administrative agency, arbitrator or
governmental body
and no proceedings are pending which might result in such
suspension or
revocation;
(2) The Seller has the full power and authority to hold each
Mortgage
Loan, to sell each Mortgage Loan, and to execute, deliver and
perform, and to
enter into and consummate, all transactions contemplated by this
Agreement. The
Seller has duly authorized the execution, delivery and performance
of this
Agreement, has duly executed and delivered this Agreement, and this
Agreement,
assuming due authorization, execution and delivery by the
Purchaser, constitutes
a legal, valid and binding obligation of the Seller, enforceable
against it in
accordance with its terms except as the enforceability thereof may
be limited by
bankruptcy, insolvency or reorganization;
(3) The execution and delivery of this Agreement by the Seller and
the
performance of and compliance with the terms of this Agreement will
not violate
the Seller's articles of incorporation or by-laws or constitute a
default under
or result in a breach or acceleration of, any material contract,
agreement or
other instrument to which the Seller is a party or which may be
applicable to
the Seller or its assets;
(4) The Seller is not in violation of, and the execution and
delivery
of this Agreement by the Seller and its performance and compliance
with the
terms of this Agreement will not constitute a violation with
respect to, any
order or decree of any court or any order or regulation of any
federal, state,
municipal or governmental agency having jurisdiction over the
Seller or its
assets, which violation might have consequences that would
materially and
adversely affect the condition (financial or otherwise) or the
operation of the
Seller or its assets or might have consequences that would
materially and
adversely affect the performance of its obligations and duties
hereunder;
(5) The Seller does not believe, nor does it have any reason or
cause
to believe, that it cannot perform each and every covenant
contained in this
Agreement;
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(6) The Mortgage Loan Documents have been delivered to the
Custodian.
With respect to each Mortgage Loan, the Seller is in possession of
a complete
Mortgage File in compliance with Exhibit 1, except for such
documents as have
been delivered to the Custodian;
(7) Immediately prior to the payment of the Purchase Price for
each
Mortgage Loan, the Seller was the owner of record of the related
Mortgage and
the indebtedness evidenced by the related Mortgage Note and upon
the payment of
the Purchase Price by the Purchaser, in the event that the Seller
retains record
title, the Seller shall retain such record title to each Mortgage,
each related
Mortgage Note and the related Mortgage Files with respect thereto
in trust for
the Purchaser as the owner thereof and only for the purpose of
servicing and
supervising the servicing of each Mortgage Loan;
(8) There are no actions or proceedings against, or investigations
of,
the Seller before any court, administrative agency or other
tribunal (A) that
might prohibit its entering into this Agreement, (B) seeking to
prevent the sale
of the Mortgage Loans or the consummation of the transactions
contemplated by
this Agreement or (C) that might prohibit or materially and
adversely affect the
performance by the Seller of its obligations under, or the validity
or
enforceability of, this Agreement;
(9) No consent, approval, authorization or order of any court
or
governmental agency or body is required for the execution, delivery
and
performance by the Seller of, or compliance by the Seller with,
this Agreement
or the consummation of the transactions contemplated by this
Agreement, except
for such consents, approvals, authorizations or orders, if any,
that have been
obtained prior to the Closing Date;
(10) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Seller, and
the
transfer, assignment and conveyance of the Mortgage Notes and the
Mortgages by
the Seller pursuant to this Agreement are not subject to the bulk
transfer or
any similar statutory provisions;
(11) The consideration received by the Seller upon the sale of
the
Mortgage Loans constitutes fair consideration and reasonably
equivalent value
for such Mortgage Loans;
(12) The Seller is solvent and will not be rendered insolvent by
the
consummation of the transactions contemplated hereby. The Seller is
not
transferring any Mortgage Loan with any intent to hinder, delay or
defraud any
of its creditors; and
(13) The Seller is in good standing, and will comply in all
material
respects with the rules and procedures of MERS in connection with
the servicing
of the MERS Loans for as long as such Mortgage Loans are registered
with MERS.
Subsection 7.02 Representations and Warranties Regarding
Individual
Mortgage Loans.
(a) The Seller hereby represents and warrants to the Purchaser
that,
as to each Mortgage Loan, as of the Closing Date for such Mortgage
Loan:
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(1) The information set forth in the Final Mortgage Loan Schedule
is
complete, true and correct;
(2) [Reserved];
(3) There are no defa
