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Exhibit 10.2(C)
EXECUTION VERSION
REGULATION AB COMPLIANCE ADDENDUM
TO MORTGAGE LOAN FLOW PURCHASE, SALE AND SERVICING AGREEMENT
This
Regulation AB Compliance Addendum (this "Reg AB Addendum"),
dated as
of January 1, 2006, by and between Bank of America, National Association (the
"Purchaser") and PHH
Mortgage Corporation
(the "Company") and Bishop's Gate
Residential Mortgage
Trust (formerly known as Cendant Residential Mortgage
Trust), (the "Trust Seller"), to that certain Mortgage Loan Flow
Purchase, Sale
and Servicing Agreement, dated as of August 1, 2005, by and between
the Company,
the Trust Seller and the Purchaser (as amended, modified or supplemented, the
"Agreement").
WITNESSETH
WHEREAS, the Company,
the Trust Seller and
the Purchaser
have agreed to
adopt an addendum to the Agreement to reflect the intention of the parties to
comply with Regulation AB.
NOW,
THEREFORE,
in consideration of the mutual promises and mutual
obligations set forth
herein, the Company,
the Trust Seller and
the Purchaser
hereby agree as follows:
ARTICLE I
DEFINED TERMS
Capitalized terms used
but not defined
herein shall have the meanings
assigned to such terms
in the Agreement.
The following terms shall have the
meanings set forth below, unless the context clearly indicates
otherwise:
Commission: The United States Securities and Exchange
Commission.
Company Information: As defined in Section 2.07(a).
Depositor: The
depositor,
as such term is
defined in Regulation AB, with
respect to any Securitization Transaction.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Master Servicer:
With respect to any Securitization Transaction, the
"master servicer," if any, identified in the related transaction
documents.
Qualified
Correspondent: Any
Person from which the Company purchased
Mortgage Loans,
provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between
the Company and
such Person that contemplated that such Person would underwrite
mortgage loans
from time to time, for
sale to the Company,
in accordance
with underwriting
guidelines designated
by the Company
("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 Company within 180 days after origination;
(iii) either (x)
the
Designated Guidelines
were, at the time such
Mortgage Loans were
originated,
used by the Company in
origination of
mortgage loans of the same type as the
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Mortgage Loans for the
Company's own account or (y) the Designated Guidelines
were, at the time such
Mortgage Loans were underwritten, designated by the
Company on a consistent basis for use by lenders in
originating mortgage
loans
to be purchased by the Company; and (iv) the Company employed,
at the time such
Mortgage Loans were
acquired by the
Company, 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
Company.
Reconstitution: Any Securitization Transaction or Whole Loan
Transfer.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB),
17 C.F.R. ss.ss.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.
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.
Servicer: As defined in Section 2.03(c).
Servicing Criteria:
The "servicing
criteria" set forth in Item 1122(d) of
Regulation AB, as such may be amended from time to time.
Static Pool
Information: Static
pool information
as described in Item
1l05(a)(l)-(3) and 1105(c) of Regulation AB.
Subcontractor: Any
vendor, subcontractor or other Person that is not
responsible for the overall servicing (as "servicing" is commonly
understood by
participants in the
mortgage-backed
securities
market) of Mortgage
Loans but
performs one
or more discrete functions identified in Item l122( d) of
Regulation AB with respect to Mortgage Loans under the direction or
authority of
the Company or a Subservicer.
Subservicer: Any
Person that services Mortgage Loans on behalf of the
Company or any
Subservicer and is
responsible
for the performance (whether
directly or through
Subservicers or Subcontractors) of a substantial portion of
the material servicing
functions required to
be performed by the Company under
this Agreement or any
Reconstitution
Agreement that are identified in Item
1122(d) of Regulation AB.
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Third-Party Originator: Each Person, other than a
Qualified Correspondent,
that originated Mortgage Loans acquired by the Company.
Whole Loan Transfer:
Any sale or transfer
of some or all of the
Mortgage
Loans, other than a Securitization Transaction.
ARTICLE II
COMPLIANCE WITH REGULATION AB
Section 2.01. Intent
of the Parties; Reasonableness.
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The
Purchaser and the Company acknowledge and agree that the purpose of
Article II of this Reg AB Addendum is to facilitate compliance by the Purchaser
and any Depositor
with the provisions of Regulation AB and related rules
and
regulations of the
Commission
and that the
provisions of this Reg AB Addendum
shall be applicable to all Mortgage Loans included in a Securitization
Transaction closing on or after January 1, 2006, regardless whether
the Mortgage
Loans were purchased by the Purchaser from the Company prior to the
date hereof.
Although Regulation
AB is applicable by its terms only to offerings of
asset-backed
securities that are
registered
under the Securities Act, the
Company acknowledges
that investors in privately offered securities may require
that the Purchaser or any Depositor provide comparable disclosure in
unregistered
offerings.
References in
this Agreement to compliance with
Regulation AB include provision of comparable disclosure in private
offerings.
Neither the Purchaser nor any Depositor shall exercise its right to
request
delivery of information or other performance under these provisions other
than
in good faith, or for
purposes other than
compliance with the
Securities Act,
the Exchange Act and the rules and regulations of the Commission
thereunder (or
the provision in a private offering of disclosure comparable to that required
under the Securities Act). The Company acknowledges that interpretations
of the
requirements of Regulation AB may change over time, whether due to interpretive
guidance provided by the Commission or its staff, consensus among participants
in the asset-backed
securities markets,
advice of counsel, or
otherwise, and
agrees to comply with requests made by the Purchaser, any Master
Servicer or any
Depositor in good faith for delivery of information under these provisions on
the basis of evolving
interpretations of
Regulation AB. In connection with any
Securitization Transaction, the Company shall cooperate fully with
the Purchaser
and any Master
Servicer to deliver to the Purchaser (including any of its
assignees or
designees), any Master
Servicer and any
Depositor,
any and all
statements, reports, certifications, records and any other
information necessary
in the good faith
determination of the
Purchaser, the Master
Servicer or any
Depositor to permit the Purchaser, such Master Servicer or such Depositor to
comply with the
provisions of
Regulation AB,
together with such
disclosures
relating to the Company, any Subservicer, any Third-Party Originator and the
Mortgage Loans, or the servicing of the Mortgage Loans,
reasonably
believed by
the Purchaser
or any Depositor to be necessary in order to effect such
compliance.
The
Purchaser (including any of its assignees or designees) shall
cooperate
with the Company by providing timely notice of requests for
information
under
these provisions
and by reasonably limiting such requests to information
required, in the Purchaser's reasonable judgment, to comply with
Regulation AB.
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Section 2.02.
Additional Representations and Warranties of the Company.
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(a)
The Company hereby represents to the Purchaser, to any Master Servicer
and to any Depositor,
as of the date on which information is first provided
to
the Purchaser,
any Master
Servicer or any
Depositor under
Section 2.03 that,
except as disclosed in writing to the Purchaser, such Master Servicer or such
Depositor prior to
such date: (i) the Company is not aware and has not received
notice that any default, early amortization or other performance triggering
event has occurred as to any other securitization due to any act or failure to
act of the Company;
(ii) the Company has not been terminated as servicer in a
residential mortgage loan securitization, either due to a servicing default
or
to application of a
servicing performance
test or trigger;
(iii) no material
noncompliance with the
applicable
Servicing Criteria with respect to other
securitizations of residential mortgage loans involving the
Company as servicer
has been disclosed or reported by the Company; (iv) no material changes to the
Company's policies or
procedures with respect to the servicing function it will
perform under this Agreement and any Reconstitution Agreement for
mortgage loans
of a type similar to
the Mortgage Loans
have occurred
during the
three-year
period immediately preceding the related Securitization
Transaction;
(v) there
are no aspects of the Company's financial condition that could have a
material
adverse effect on the
performance by the
Company of its servicing obligations
under this Agreement or any Reconstitution Agreement; (vi) there
are no material
legal or governmental
proceedings pending (or known to be contemplated) against
the Company, any Subservicer or any Third-Party Originator;
and (vii) there
are
no affiliations,
relationships
or transactions
relating to the
Company, any
Subservicer or any
Third-Party Originator
with respect to any
Securitization
Transaction and any party thereto identified by the related
Depositor of a type
described in Item 1119 of Regulation AB.
(b)
If so requested by the Purchaser, any Master Servicer or any
Depositor
on any date following
the date on which
information is first
provided to the
Purchaser, any Master
Servicer or any Depositor under Section 2.03, the Company
shall, within five Business Days following such request,
confirm in writing
the
accuracy of the
representations and
warranties
set forth in paragraph
(a) of
this Section or, if any such representation and warranty is not accurate as
of
the date of such request, provide reasonably adequate disclosure of the
pertinent facts, in writing, to the requesting party.
Section 2.03.
Information to Be Provided by the Company.
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In
connection with any
Securitization
Transaction, the
Company shall (i)
within five Business Days following request by the Purchaser or any
Depositor,
provide to the
Purchaser and such
Depositor (or, as applicable, cause each
Third-Party Originator
and each Subservicer to provide), in writing and in form
and substance reasonably satisfactory to the Purchaser and
such Depositor,
the
information and materials specified in paragraphs (a), (b),
(c), (f) and (g) of
this Section,
and (ii) as
promptly as practicable following notice to or
discovery by the Company, provide to the Purchaser and any
Depositor (in writing
and in form and
substance reasonably
satisfactory
to the Purchaser and such
Depositor) the information specified in paragraph (d) of this
Section.
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(a)
If so requested by the
Purchaser or any
Depositor, the Company
shall
provide such
information
regarding (i) the Company, as originator of the
Mortgage Loans
(including
as an acquirer
of Mortgage
Loans from a
Qualified
Correspondent), or
(ii) each Third-Party
Originator, and (iii)
as applicable,
each Subservicer,
as is requested for the purpose of compliance with Items
1103(a)(l), 1105,
1110, 1117 and 1119 of Regulation AB. Such information shall
include, at a minimum:
(A) the originator's form of organization;
(B) a description of the originator's origination program and how
long
the
originator has been engaged in originating residential mortgage loans,
which description shall include a discussion of the originator's
experience
in
originating
mortgage loans of a similar type as the
Mortgage Loans;
information
regarding the
size and composition of the originator's
origination portfolio;
and information that
may be material, in
the good
faith judgment of the
Purchaser or any
Depositor,
to an analysis of
the
performance of
the Mortgage Loans, including the originators'
credit-granting or
underwriting
criteria for
mortgage loans of similar
type(s) as the Mortgage Loans and such other information as the Purchaser
or
any Depositor may reasonably request for the purpose of
compliance with
Item
1110(b)(2) of Regulation AB;
(C) a description of
any material legal or
governmental
proceedings
pending (or known to be contemplated) against the Company, each
Third-Party
Originator and each Subservicer; and
(D) a description
of any affiliation or relationship between the
Company, the Trust
Seller, each Third-Party Originator, each Subservicer
and
any of the following parties to a Securitization Transaction, as such
parties are identified
to the Company by the Purchaser or any Depositor in
writing in advance of such Securitization Transaction:
(1) the
sponsor;
(2) the depositor;
(3) the issuing
entity;
(4) any
servicer;
(5) any
trustee;
(6) any
originator;
(7) any
significant obligor;
(8) any
enhancement or support provider; and
(9) any other
material transaction party.
(b)
If so requested by the
Purchaser or any
Depositor, the Company
shall
provide (or, as applicable, cause each Third-Party Originator to
provide) Static
Pool Information
with respect to the
mortgage loans (of a
similar type as the
Mortgage Loans,
as reasonably
identified by the
Purchaser as provided
below)
originated by (i) the Company, if the Company is an originator of
Mortgage Loans
(including as an
acquirer of Mortgage
Loans from a Qualified
Correspondent),
and/or (ii) each Third-Party Originator. Such Static Pool Information shall
be
prepared by
the Company (or Third-Party Originator) on the basis of its
reasonable, good faith interpretation of the requirements of Item
1105(a)(1)-(3)
of Regulation
AB. To the extent
that there is reasonably available to the
Company (or Third-Party Originator) Static Pool Information with
respect to more
than one mortgage loan type, the Purchaser or any Depositor shall
be entitled to
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specify whether some or all of such information shall be provided pursuant to
this paragraph. The
content of such Static Pool Information may be in the form
customarily provided
by the Company, and need not be customized for the
Purchaser or any Depositor. Such Information for each vintage
origination year
or prior securitized
pool, as applicable,
shall be presented in
increments no
less frequently
than quarterly over
the life of the mortgage loans included in
the vintage origination year or prior securitized pool. The most
recent periodic
increment must be as
of a date no later
than 135 days prior to the date of the
prospectus or other offering document in which the Static Pool
Information is to
be included or incorporated by reference. The Static Pool Information
shall be
provided in an
electronic
format that provides a permanent record of the
information provided,
such as a portable
document format (pdf)
file, or other
such electronic format reasonably required by the Purchaser or the
Depositor, as
applicable.
Promptly following
notice or discovery of
a material error in Static Pool
Information provided pursuant to the immediately preceding paragraph (including
an omission to include therein information required to be provided pursuant
to
such paragraph), the
Company shall provide corrected Static Pool Information to
the Purchaser
or any Depositor, as applicable, in the same format in which
Static Pool Information was previously provided to such party by
the Company.
If
so requested
by the Purchaser or any Depositor, the Company shall
provide (or, as applicable, cause each Third-Party
Originator to
provide), at
the expense of the requesting party (to the extent of any
additional incremental
expense associated
with delivery pursuant
to this Agreement),
such statements
and agreed-upon
procedures letters of certified public accountants reasonably
acceptable to the Purchaser or Depositor, as applicable, pertaining to Static
Pool Information relating to prior securitized pools for
securitizations
closed
on or after January
1, 2006 or, in the
case of Static Pool
Information
with
respect to the Company's or Third-Party Originator's originations or purchases,
to calendar
months commencing January 1, 2006, as the Purchaser or such
Depositor shall
reasonably
request. Such statements and letters shall be
addressed to and be
for the benefit of such parties as the Purchaser or such
Depositor shall designate, which may include, by way of example, any Sponsor,
any Depositor and any broker dealer acting as underwriter, placement agent or
initial purchaser
with respect to a Securitization Transaction. Any such
statement or
letter may take the form of a standard, generally applicable
document accompanied by a reliance letter authorizing reliance by
the addressees
designated by the Purchaser or such Depositor.
(c)
If so requested by the
Purchaser or any
Depositor, the Company
shall
provide such
information regarding
the Company, as servicer of the Mortgage
Loans, and each
Subservicer
(each of the
Company and each
Subservicer,
for
purposes of this
paragraph, a
"Servicer"), as is
requested for the purpose of
compliance with Items
1108, 1117 and 1119 of
Regulation AB. Such
information
shall include, at a minimum:
(A) the Servicer's form of organization;
(B) a description
of how long the Servicer has been servicing
residential
mortgage loans;
a general discussion of the Servicer's
experience in
servicing assets of any type as well as a more
detailed
discussion of the
Servicer's
experience
in, and procedures for, the
servicing
function it
will perform under the Agreement and any
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Reconstitution Agreements; information regarding the size,
composition and
growth of the Servicer's portfolio of residential mortgage
loans of a type
similar to the Mortgage Loans and information on factors related to the
Servicer that may be material, in the good faith judgment of the
Purchaser
or
any Depositor, to any analysis of the servicing of the Mortgage
Loans or
the
related asset-backed
securities,
as applicable,
including,
without
limitation:
(1) whether any prior securitizations of mortgage loans of a
type
similar to the Mortgage Loans involving the Servicer have defaulted
or
experienced an early
amortization
or other performance triggering
event because of servicing during the three-year period immediately
preceding the related Securitization Transaction;
(2) the extent of outsourcing the Servicer utilizes;
(3) whether
there has been previous disclosure of material
noncompliance with the
applicable servicing
criteria with respect to
other securitizations
of residential
mortgage loans involving the
Servicer as a
servicer during the three-year period immediately
preceding the related Securitization Transaction;
(4) whether the
Servicer has been
terminated
as servicer in a
residential mortgage
loan securitization,
either due to a
servicing
default or to application of a servicing performance test or trigger;
and
(5) such other
information as the Purchaser or any Depositor may
reasonably request for
the purpose of compliance with Item 1108(b)(2)
of Regulation AB;
(C) a description of any material changes during the three-year
period
immediately preceding
the related Securitization Transaction to the
Servicer's policies or procedures with respect to the servicing
function it
will
perform under the
Agreement and any
Reconstitution
Agreements
for
mortgage loans of a type similar to the Mortgage Loans;
(D) information
regarding the Servicer's financial condition, to the
extent that there is a
material risk that an
adverse financial
event or
circumstance involving the Servicer could have a material adverse
effect on
the
performance
by the Company of its servicing obligations under the
Agreement or any Reconstitution Agreement;
(E) information
regarding advances made by the Servicer on the
Mortgage Loans
and the Servicer's overall servicing portfolio of
residential mortgage loans for the three-year period immediately
preceding
the
related Securitization Transaction, which may be limited to a
statement
by
an authorized
officer of the
Servicer to the effect
that the Servicer
has
made all advances
required to be made on
residential mortgage
loans
serviced by it during
such period, or, if such statement would not be
accurate, information
regarding the
percentage
and type of advances
not
made
as required, and the reasons for such failure to advance;
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(F) a description of the Servicer's processes and procedures
designed
to
address any special or unique factors involved in servicing loans of a
similar type as the Mortgage Loans;
(G) a description of the Servicer's processes for handling
delinquencies,
losses, bankruptcies
and recoveries, such as through
liquidation of mortgaged properties, sale of defaulted mortgage loans or
workouts;
(H) information
as to how the Servicer defines or determines
delinquencies and
charge-offs,
including the effect
of any grace period,
re-aging,
restructuring, partial
payments considered current or other
practices with respect to delinquency and loss experience;
(I) a description of
any material legal or
governmental
proceedings
pending (or known to be contemplated) against the Servicer; and
(J) a description
of any affiliation or relationship between the
Servicer and any of the following parties to a Securitization
Transaction,
as
such parties are
identified
to the Servicer by the Purchaser or any
Depositor in writing in advance of such Securitization
Transaction:
(1) the
sponsor;
(2) the
depositor;
(3) the issuing
entity;
(4) any
servicer;
(5) any
trustee;
(6) any
originator;
(7) any
significant obligor;
(8) any
enhancement or support provider; and
(9) any other
material transaction party.
(d)
For the purpose
of satisfying the reporting obligation under the
Exchange Act with respect to any class of asset-backed securities, the Company
shall (or shall cause
each Subservicer and Third-Party Originator to) (i)
provide prompt notice to the Purchaser, any Master Servicer and any
Depositor in
writing of (A) any material litigation or governmental proceedings
involving the
Company, the Trust
Seller, any Subservicer or any Third-Party Originator, (B)
any affiliations or relationships that develop following the closing date of
a
Securitization
Transaction
between the
Company, the Trust Seller, any
Subservicer or any
Third-Party Originator
and any of the parties
specified in
clause (D) of paragraph (a) of this Section (and any other parties
identified in
writing by
the requesting party) with respect to such Securitization
Transaction, (C) any
Event of Default under
the terms of the
Agreement or any
Reconstitution Agreement, (D) any merger, consolidation or sale of
substantially
all of the assets of the Company, and (E) the Company's entry into
an agreement
with a Subservicer
to perform or assist in the performance of any of the
Company's obligations
under the Agreement or any Reconstitution Agreement and
(ii) provide
to the Purchaser and any Depositor a description of such
proceedings, affiliations or relationships.
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(e)
As a condition to the
succession to the Company or any Subservicer as
servicer or subservicer under the Agreement or any Reconstitution Agreement by
any Person
(i) into which the
Company or such Subservicer may be merged or
consolidated, or (ii)
which may be appointed
as a successor to the
Company or
any Subservicer,
the Company shall provide to the Purchaser, any Master
Servicer, and any
Depositor,
at least 15 calendar
days prior to the effective
date of such succession or appointment, (x) written notice to the
Purchaser and
any Depositor of such
succession or appointment and (y) in writing and in form
and substance reasonably satisfactory to the Purchaser and
such Depositor,
all
information reasonably
requested by the
Purchaser or any Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K
with respect to
any class of asset-backed securities.
(f)
In addition
to such information as the Company, as servicer, is
obligated to provide
pursuant to other
provisions of the Agreement, not later
than ten days prior to the deadline for the filing of any
distribution rep
