EXHIBIT 10.17.2
CUSTODIAL AGREEMENT
CUSTODIAL
AGREEMENT (as amended, restated, supplemented or otherwise
modified and in effect from time to time, this "Custodial
Agreement"), dated as
of January 27, 2006, made by and among:
(i)
AMERICAN HOME MORTGAGE CORP., a New York corporation, AMERICAN
HOME
MORTGAGE INVESTMENT CORP., a Maryland corporation, AMERICAN HOME
MORTGAGE
HOLDINGS, INC., a Delaware corporation, AMERICAN HOME MORTGAGE
ACCEPTANCE, INC.,
a Maryland corporation, and AMERICAN HOME MORTGAGE SERVICING, INC.,
a Maryland
corporation, (each a "Seller", collectively the "Sellers");
(ii)
MORGAN STANLEY BANK (the "Buyer Agent"); and
(iii)
DEUTSCHE BANK NATIONAL TRUST COMPANY, as custodian for the
Buyer
Agent pursuant to this Custodial Agreement (in such capacity, the
"Custodian").
RECITALS
The Buyer
Agent, the Custodian and the Sellers are parties to that
certain
Amended and Restated Custodial Agreement, dated as of November 26,
2003 (as
amended, supplemented or otherwise modified prior to the date
hereof, the
"Existing Custodial Agreement").
The
Sellers and the Buyer Agent are parties to that certain Master
Repurchase Agreement, dated as of the date hereof (as amended,
restated,
supplemented or otherwise modified and in effect from time to time,
the
"Repurchase Agreement"), pursuant to which the Buyers have agreed,
subject to
the terms and conditions of the Repurchase Agreement, to purchase
Eligible
Mortgage Loans (as defined therein) from the Sellers. The
Repurchase Agreement
is being entered into in substitution for that certain Amended and
Restated
Master Loan and Security Agreement, dated as of November 26, 2003,
among the
parties thereto.
It is a
condition precedent to the effectiveness of the Repurchase
Agreement, and the Sellers, the Custodian and the Buyer Agent have
agreed, that
this Custodial Agreement shall be substituted for the Existing
Custodial
Agreement.
Accordingly, the Sellers, the Custodian and the Buyer Agent hereby
agree,
in consideration of the mutual premises and mutual obligations set
forth herein,
that this Custodial Agreement is entered into in substitution for
the Existing
Custodial Agreement, and in furtherance of the foregoing agree as
follows:
Section 1.
Definitions.
Unless
otherwise defined herein, terms defined in the Repurchase
Agreement
shall have their respective assigned meanings when used herein, and
the
following terms shall have the following meanings:
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"Affiliate" shall mean (i) with respect to the Buyer Agent, MS
& Co. and
Morgan Stanley Dean Witter & Co., and (ii) with respect to any
other Person, any
"affiliate" of such Person as such term is defined in the United
States
Bankruptcy Code in effect from time to time.
"Agency"
shall mean Fannie Mae or Freddie Mac.
"Agency
Guide" shall mean, with respect to Fannie Mae securities, the
Fannie Mae Selling Guide and the Fannie Mae Servicing Guide, with
respect to
Freddie Mac securities, the Freddie Mac Sellers' and Servicers'
Guide, and with
respect to California Program securities, the applicable program
manual and the
servicer's guide, in each case including all exhibits thereto, as
such Agency
Guide may be amended, supplemented or otherwise modified from time
to time."
"Agency
Program" shall mean a specific mortgage backed securities swap
or
purchase program under the relevant Agency Guide or as otherwise
approved by the
Agency with respect to Mortgage Loans originated pursuant to the
Agency Guide.
"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 and
pledge of
the mortgage.
"Authorized Representative" shall have the meaning specified in
Section 18
hereof.
"Business
Day" shall mean any day other than (i) a Saturday or Sunday or
(ii) a day on which the New York Stock Exchange, the Federal
Reserve Bank of New
York or the Custodian is authorized or obligated by law or
executive order to be
closed.
"Cooperative Corporation" shall mean the cooperative apartment
corporation
that holds legal title to a Cooperative Project and grants
occupancy rights to
units therein to stockholders through Proprietary Leases or
similar
arrangements.
"Cooperative Mortgage Loan" shall mean a Mortgage Loan that is
secured by
a first lien on a perfected security interest in Cooperative Shares
and the
related Proprietary Lease granting exclusive rights to occupy the
related
Cooperative Unit in the building owned by the related Cooperative
Corporation.
"Cooperative Project" shall mean all real property owned by a
Cooperative
Corporation including the land, separate dwelling units and all
common elements.
"Cooperative Shares" shall mean the shares of stock issued by a
Cooperative Corporation and allocated to a Cooperative Unit and
represented by a
stock certificate.
"Cooperative Unit" shall mean a specific unit in a Cooperative
Project.
"Custodial
Agreement" shall mean this Custodial Agreement, as the same
shall be amended, restated, supplemented or otherwise modified and
in effect
from time to time in accordance with the terms hereof.
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"Custodial
Delivery Failure" shall have the meaning assigned to such term
in Section 13(c).
"Custodial
Identification Certificate" shall mean the certificate executed
by the Sellers in connection with the sale of Eligible Mortgage
Loans to the
Buyers to be held by the Custodian pursuant to this Custodial
Agreement, a form
of which is attached as Annex 3 hereto.
"Electronic Agent" shall have the meaning assigned to such term in
Section
2 of the Electronic Tracking Agreement.
"Electronic Tracking Agreement" shall mean the Electronic
Tracking
Agreement, dated as of the date hereof, among the Sellers, the
Buyer Agent, the
Electronic Agent and MERS, as the same shall be amended, restated,
supplemented
or otherwise modified and in effect from time to time.
"Eligible
Cooperative Mortgage Loan" shall mean a Cooperative Mortgage
Loan as to which the representations and warranties in Section 6.11
of the
Repurchase Agreement and the eligibility criteria set forth in Part
I of
Schedule 1 of the Repurchase Agreement are correct.
"Eligible
Mortgage Loan" shall mean a Mortgage Loan secured by a first
mortgage lien on a one-to-four family residential property (a) as
to which the
representations and warranties in Section 6.10 and Part I of
Schedule 1 of the
Repurchase Agreement are correct and (b) which is either an Agency
Eligible
Mortgage Loan, an Alternate `A' Mortgage Loan, a California Program
Mortgage
Loan, an Eligible Cooperative Mortgage Loan, a Jumbo Mortgage Loan,
a MERS
Designated Mortgage Loan or a Conduit Eligible Mortgage Loan;
provided, that in
no event shall any Eligible Mortgage Loan be a security for
purposes of any
securities or blue sky laws.
"Exception" shall mean, with respect to any Mortgage Loan, any of
the
following: the variances from the requirements of Section 2 hereof
with respect
to the Mortgage Files (giving effect to the Sellers' right to
deliver certified
copies in lieu of original documents in certain circumstances).
"MERS
Designated Mortgage Loan" shall have the meaning assigned to
such
term in Section 3 of the Electronic Tracking Agreement.
"MERS
Identification Number" shall mean the eighteen digit number
permanently assigned to each MERS Designated Mortgage Loan.
"MERS
Procedures Manual" shall mean the MERS Procedures Manual attached
as
Exhibit B to the Electronic Tracking Agreement, as it may be
amended,
supplemented or modified from time to time.
"MERS
Report" shall mean the schedule listing MERS Designated
Mortgage
Loans and other information prepared by the Electronic Agent
pursuant to the
Electronic Tracking Agreement.
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"MERS(R)
System" shall mean the Electronic Agent's mortgage electronic
registry system, as more particularly described in the MERS
Procedures Manual."
"Mortgage
File" shall mean, as to each Mortgage Loan, those documents
listed in Section 2 of this Custodial Agreement that are delivered
to the
Custodian or which at any time come into the possession of the
Custodian.
"Mortgage
Loan" shall mean a mortgage loan which the Custodian has been
instructed to hold for the Buyer Agent pursuant to this Custodial
Agreement.
"Mortgage
Loan Schedule" shall mean a list (in computer readable form) of
Eligible Mortgage Loans to be sold pursuant to the Repurchase
Agreement,
attached to a Custodial Identification Certificate, setting forth,
as to each
Eligible Mortgage Loan, the applicable information specified on
Annex 1 to this
Custodial Agreement.
"Mortgage
Loan Schedule and Exception Report" shall mean a list of
Eligible Mortgage Loans delivered by the Custodian to the Buyer
Agent on each
Business Day, reflecting the Mortgage Loans held by the Custodian
for the
benefit of the Buyer Agent on behalf of the Buyers, which includes
codes
indicating any Exceptions with respect to each Mortgage Loan listed
thereon.
Each Mortgage Loan Schedule and Exception Report shall set forth
(a) the
Mortgage Loans being sold to the Buyers on any applicable Purchase
Date as well
as the Mortgage Loans previously sold to the Buyers and held by the
Custodian
hereunder, (b) any Mortgage Loan that has been released to a Seller
pursuant to
Section 5 hereof and the date such Mortgage Loan was released and
(c) all
Exceptions with respect thereto, with any updates thereto from the
time last
delivered.
"Officer's
Certificate" shall mean a certificate signed by a Responsible
Officer of the Person delivering such certificate and delivered as
required by
this Custodial Agreement.
"Opinion
of Counsel" shall mean a written opinion letter of counsel in
form and substance reasonably acceptable to the party receiving
such opinion
letter.
"Pledgee"
shall have the meaning specified in Section 25 hereof.
"Proceeds"
shall mean whatever is receivable or received when Purchased
Items or proceeds are sold, collected, exchanged or otherwise
disposed of,
whether such disposition is voluntary or involuntary, and includes,
without
limitation, all rights to payment, including return premiums, with
respect to
any insurance relating thereto.
"Proprietary Lease" shall mean a lease on (or occupancy agreement
with
respect to) a Cooperative Unit evidencing the possessory interest
of the owner
of the Cooperative Shares or the Seller in such Cooperative
Unit.
"Recognition Agreement" shall mean, with respect to a Cooperative
Mortgage
Loan, an agreement executed by a Cooperative Corporation which,
among other
things, acknowledges the lien of the Mortgage on the Mortgaged
Property in
question.
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"Report"
shall mean a report in computer readable form prepared by the
Custodian, which shall be in a form acceptable to the Buyer Agent
and the
Custodian detailing, with respect to any Mortgage Loan that has
been released by
the Custodian, the following: (i) the Mortgage Loan identification
number and
borrower name, (ii) the location to which such Mortgage File was
delivered by
the Custodian and (iii) the date on which such Mortgage File was
released by the
Custodian.
"Review
Procedures" shall have the meaning specified in Section 3(c)
hereof.
"Security
Agreement" the specific security agreement creating a security
interest on and pledge of the Cooperative Shares and the
appurtenant Proprietary
Lease securing a Cooperative Mortgage Loan.
"Trust
Receipt" shall mean a Trust Receipt in the form annexed hereto
as
Annex 2 delivered to the Buyer Agent by the Custodian covering all
of the
Mortgage Loans subject to this Custodial Agreement from time to
time, as
reflected on the Mortgage Loan Schedule and Exception Report
attached thereto in
accordance with Section 3(e).
Section 2. Delivery of
Mortgage Files.
No later
than 11:00 p.m., New York City time, one (1) Business Day prior
to any Purchase Date (in the case of the first 150 Eligible
Mortgage Loans
delivered in connection with any Purchase Date) plus one additional
Business Day
prior to any Purchase Date (for each additional 100 Eligible
Mortgage Loans in
excess thereof delivered in connection with any Purchase Date)
(provided, that,
such timing requirements shall be inapplicable in the case of
Mortgage Loans
already held by the Custodian for any other reason), the applicable
Seller shall
release to the Custodian the following original documents
pertaining to each
Eligible Mortgage Loan to be sold to the Buyers and included in the
Margin Base
on such Purchase Date, each of which Mortgage Loans shall be
identified in a
Mortgage Loan Schedule delivered therewith, in a computer readable
format
acceptable to the Sellers and the Custodian, with a copy of such
Mortgage Loan
Schedule delivered to the Buyer Agent (or, if another time is
specified below
for such release or delivery, at such other time):
(A)
With respect to
each Eligible Mortgage Loan:
(a) The original
Mortgage Note bearing all intervening
endorsements, endorsed "Pay to the order of _________ without
recourse" and signed in the name of the last endorsee (the
"Last Endorsee") (in the event that the Mortgage Loan was
acquired by the Last Endorsee in a merger, the signature must
be in the following form: "[Last Endorsee], successor by
merger to [name of predecessor]"; in the event that the
Mortgage Loan was acquired or originated by the Last Endorsee
while doing business under another name, the signature must be
in the following form: "[Last Endorsee], formerly known as
[previous name]").
(b) The original
of the guarantee executed in connection with the
Mortgage Note (if any).
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(c) The original
Mortgage with evidence of recording thereon, or a
copy thereof together with an Officer's Certificate of the
applicable Seller, title company, escrow agent or closing
attorney certifying that such represents a true and correct
copy of the original and that such original has been submitted
for recordation in the appropriate governmental recording
office of the jurisdiction where the Mortgaged Property is
located.
(d) The
originals of all assumption, modification, consolidation
or extension agreements (if any) with evidence of recording
thereon, or copies thereof together with an Officer's
Certificate of the applicable Seller, title company, escrow
agent or closing attorney certifying that such represent true
and correct copies of the originals and that such originals
have each been submitted for recordation in the appropriate
governmental recording office of the jurisdiction where the
Mortgaged Property is located (provided, that the Custodian
shall have no duty to verify whether any such documents
exist).
(e) Except in
the case of a MERS Designated Mortgage Loan, the
original Assignment of Mortgage in blank for each Mortgage
Loan, in form and substance acceptable for recording and
signed in the name of the Last Endorsee (in the event that the
Mortgage Loan was acquired by the Last Endorsee in a merger,
the signature must be in the following form: "[Last Endorsee],
successor by merger to [name of predecessor]"; in the event
that the Mortgage Loan was acquired or originated while doing
business under another name, the signature must be in the
following form: "[Last Endorsee], formerly known as [previous
name]").
(f) Except in
the case of a MERS Designated Mortgage Loan, the
originals of all intervening assignments of mortgage (if any)
with evidence of recording thereon, showing an unbroken chain
of title from the originator thereof to the Last Endorsee or
copies thereof together with an Officer's Certificate of the
applicable Seller, title company, escrow agent or closing
attorney certifying that such represent true and correct
copies of the originals and that such originals have each been
submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged
Property is located.
(g)
[intentionally omitted.]
(h) The original
of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage
Loan; provided, that the Custodian shall have no duty to
verify whether any such documents exist.
(i) Solely with
respect to each MERS Designated Mortgage Loan, a
MERS Report.
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(B)
With respect to
each Eligible Cooperative Mortgage Loan:
(a) the original
Security Agreement;
(b) the original
Cooperative Shares;
(c) a stock
power executed in blank by the Person in whose name
the Cooperative Shares are issued;
(d) the
Proprietary Lease or occupancy agreement, accompanied by
an
assignment in blank of such proprietary lease;
(e) a
Recognition Agreement executed by the Cooperative
Corporation, which requires the Cooperative Corporation to
recognize the rights of the lender and its successors in
interest and assigns, under the Cooperative Mortgage Loan,
accompanied by an assignment of such recognition agreement in
blank;
(f) UCC-1
financing statements with recording information thereon
from the appropriate governmental recording offices if
necessary to perfect the security interest of the Cooperative
Mortgage Loan under the Uniform Commercial Code in the
jurisdiction in which the Cooperative Project is located,
accompanied by UCC-3 financing statements executed in blank
for recordation of the change in the secured party thereunder;
and
(g) any
guarantees, if applicable.
From time
to time, the Sellers shall forward to the Custodian additional
original documents or additional documents evidencing any
assumption,
modification, consolidation or extension of a Mortgage Loan
approved by the
applicable Seller, in accordance with the terms of the Repurchase
Agreement, and
upon receipt of any such other documents. Subject to the inclusion
of these
documents within the Custodial Identification Certificate and
Mortgage Loan
Schedule delivered by the Sellers, upon receipt, the Custodian
shall hold such
additional documents.
With
respect to any documents which have been delivered or are being
delivered to recording offices for recording and have not been
returned to the
applicable Seller in time to permit their delivery hereunder at the
time
required, in lieu of delivering such original documents, such
Seller shall
deliver to the Custodian a true copy thereof with an Officer's
Certificate of
the applicable Seller, title company, escrow agent or closing
attorney
certifying that such copy is a true, correct and complete copy of
the original,
which has been transmitted for recordation. Each Seller shall
deliver such
original documents to the Custodian promptly when they are
received.
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Section 3. Custodial Identification Certificate; Mortgage Loan
Schedule and
Exception Report; Trust Receipt.
(a) No
later than 12:00 p.m., New York City time, two (2) Business
Days
prior to each Purchase Date, the applicable Seller shall provide
the Custodian
with a Custodial Identification Certificate and a related Mortgage
Loan Schedule
(such information contained on the Mortgage Loan Schedule shall be
delivered to
the Custodian in computer-readable form) with respect to the
Eligible Mortgage
Loans to be sold to the Buyers on such Purchase Date. If the
Custodian has
received such Custodial Identification Certificate by the time set
forth above,
and has received a Mortgage File for a Mortgage Loan identified on
the Mortgage
Loan Schedule attached thereto by the time set forth in Section 2
hereof, then
on such Purchase Date, the Custodian will deliver, via electronic
transmission
acceptable to the Buyer Agent and the Custodian (or via facsimile
in the event
of a delivery failure via such electronic transmission), no later
than 11:00
a.m., New York City time, to the Buyer Agent a Mortgage Loan
Schedule and
Exception Report for each Mortgage Loan sold on such date, with
Exceptions
identified by the Custodian as current as of the date and time of
delivery of
such Mortgage Loan Schedule and Exception Report.
(b)
Notwithstanding and in addition to the foregoing, on each
Business
Day, as of the opening of business on such Business Day, the
Custodian shall
deliver to the applicable Seller and the Buyer Agent, via
electronic
transmission acceptable to the Buyer Agent and the Custodian (or
via facsimile
in the event of a delivery failure via such electronic
transmission), a
superceding Mortgage Loan Schedule and Exception Report, in each
case no later
than 12:00 noon, New York City time, which shall supercede and
replace any and
all previously delivered Mortgage Loan Schedule and Exception
Reports and which
shall reflect the Exceptions identified by the Custodian as of the
Business Day
prior to the date of delivery of the applicable Mortgage Loan
Schedule and
Exception Report.
(c) Each
Mortgage Loan Schedule and Exception Report shall list all
Exceptions using such codes as shall be in form and substance
agreed to by the
Custodian and the Buyer Agent. Each Mortgage Loan Schedule and
Exception Report
shall be superseded by a subsequently issued Mortgage Loan Schedule
and
Exception Report. The delivery of each Mortgage Loan Schedule and
Exception
Report to the Buyer Agent shall be the Custodian's representation
that, other
than the Exceptions listed as part of the Exception Report: (i) all
documents
required to be delivered in respect of such Mortgage Loan pursuant
to Section 2
of this Custodial Agreement have been delivered and are in the
possession of the
Custodian as part of the Mortgage File for such Mortgage Loan, (ii)
all such
documents have been reviewed by the Custodian in accordance with
the review
procedures attached hereto as Annex 4 (the "Review Procedures") and
appear on
their face to be regular and to relate to such Mortgage Loan and to
satisfy
(except in the case of a MERS Designated Mortgage Loan) the
requirements set
forth in Section 2 of this Custodial Agreement, (iii) each Mortgage
Loan (except
in the case of a MERS Designated Mortgage Loan) identified on such
Mortgage Loan
Schedule and Exception Report is being held by the Custodian as the
bailee for
the Buyer Agent and/or its designees pursuant to this Custodial
Agreement and
(iv) each MERS Designated Mortgage Loan is being held by MERS as
the bailee for
the Buyer Agent and/or its designees pursuant to the Repurchase
Agreement.
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(d) In
connection with a Mortgage Loan Schedule and Exception Report
delivered hereunder by the Custodian, the Custodian shall make
no
representations as to and shall not be responsible to verify (A)
the validity,
legality, enforceability, due authorization, recordability,
sufficiency, or
genuineness of any of the documents contained in each Mortgage
File, (B) the
collectability, insurability, effectiveness or suitability of any
such Mortgage
Loan or (C) whether such Mortgage Loan is an "Eligible Mortgage
Loan" pursuant
to the Repurchase Agreement. Subject to the following sentence,
each of the
Sellers and the Buyer Agent hereby give the Custodian notice that
from and after
the Purchase Date, the Buyers shall own (or in the event the
Transactions are
characterized as loans, the Buyer Agent, for the ratable benefit of
the Buyers,
shall have a security interest in) each Mortgage Loan identified on
a Mortgage
Loan Schedule and Exception Report until such time that the
Custodian receives
written notice from the Buyer Agent that the Buyers no longer own
such Mortgage
Loan. In the event that the Buyers do not enter into a Transaction
with the
applicable Seller prior to 5:00 p.m., New York City time, on such
Purchase Date,
upon written notice thereof from the applicable Seller,
acknowledged by the
Buyer Agent, the Custodian shall hold or release to such Seller,
pursuant to
such Seller's written instructions, the Mortgage Loans in respect
of the
Mortgage Loan Schedule and Exception Report delivered by the
Custodian on such
Purchase Date. Each Mortgage Loan Schedule and Exception Report
delivered to the
Buyer Agent by the Custodian, via electronic transmission
acceptable to the
Buyer Agent and the Custodian (or via facsimile in the event of a
delivery
failure via such electronic transmission), shall be deemed
superseded and
canceled upon the delivery of a subsequent Mortgage Loan Schedule
and Exception
Report.
(e) In
addition to the foregoing, on the initial Purchase Date, the
Custodian shall deliver to the Buyer Agent, no later than 11:00
a.m., New York
City time, a Trust Receipt with a Mortgage Loan Schedule and
Exception Report
attached thereto via electronic transmission acceptable to the
Buyer Agent and
the Custodian (or via facsimile in the event of a delivery failure
via such
electronic transmission) (with the original to follow on the next
Business Day).
Each Mortgage Loan Schedule and Exception Report delivered by the
Custodian to
the Buyer Agent shall supersede and cancel the Mortgage Loan
Schedule and
Exception Report previously delivered by the Custodian to the Buyer
Agent
hereunder, and shall replace the then existing Mortgage Loan
Schedule and
Exception Report to be attached to the Trust Receipt.
Notwithstanding anything
to the contrary set forth herein, in the event that the Mortgage
Loan Schedule
and Exception Report attached to the Trust Receipt is different
from the most
recently delivered Mortgage Loan Schedule and Exception Report,
then the most
recently delivered Mortgage Loan Schedule and Exception Report
shall control and
be binding upon the parties hereto.
Section 4. Obligations
of the Custodian.
(a) The
Custodian shall maintain continuous custody of all items
constituting the Mortgage Files in secure facilities in accordance
with
customary standards for such custody and shall reflect in its
records the
interest of the Buyers therein. Each Mortgage Note (and Assignment
of Mortgage)
shall be maintained in fire resistant facilities.
(b) With
respect to the documents constituting each Mortgage File
relating
to a Mortgage Loan listed on the related Mortgage Loan Schedule and
Exception
report, the Custodian shall (i) act exclusively as the bailee of,
and custodian
for, the Buyer Agent, (ii) hold
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all documents constituting such Mortgage File received by it for
the exclusive
use and benefit of the Buyer Agent, and (iii) make disposition
thereof only in
accordance with the terms of this Custodial Agreement or with
written
instructions furnished by the Buyer Agent; provided, however, that
in the event
of a conflict between the terms of this Custodial Agreement and the
written
instru
