Exhibit 99.13(b)
EXECUTION COPY
Morgan Stanley Mortgage Capital Inc.
and
Morgan Stanley Credit Corporation
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THIRD AMENDED AND RESTATED MASTER MORTGAGE
LOAN PURCHASE AGREEMENT
Dated as of November 1, 2005
----------------------
Fixed, Adjustable Rate, and Pledged Asset Mortgage Loans
Seller Flow Delivery Program
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Table of Contents
Section 1.
Definitions......................................................4
Section 2.
Purchase of Mortgage
Loans......................................16
Section 3.
Delivery
Requirements...........................................17
Section 4.
Examination of Mortgage
Files...................................20
Section 5.
Representations, Warranties and Agreements of
Seller............21
Section 6.
Representations, Warranties and Agreements of
Purchaser.........31
Section 7.
Compliance with Regulation
AB...................................33
Section 8.
Additional Indemnification by the Seller; Third Party
Claims....43
Section 9.
Intention of the
Parties........................................43
Section 10.
Costs...........................................................43
Section 11. Further
Agreements of Seller....................................43
Section 12. Mandatory
Delivery..............................................43
Section 13.
Termination.....................................................43
Section 14. Seller's
Right of First Refusal.................................44
Section 15.
Severability
Clause.............................................44
Section 16.
Waivers.........................................................44
Section 17.
Survival........................................................44
Section 18. Successor
and Assigns:
Assignment of Purchase Agreement........44
Section 19.
Notices.........................................................45
Section 20.
Counterparts....................................................45
Section 21. Entire
Agreement................................................45
Section 22. Governing
Law and Amendments....................................45
Section 23.
Exhibits........................................................45
Section 24. General
Interpretive Principles.................................46
Section 25.
Reproduction of
Documents.......................................46
Section 26.
Attorney-In-Fact................................................46
Section 27.
Confidentiality.................................................47
EXHIBIT 1
CONTENTS OF EACH MORTGAGE FILE
EXHIBIT 2
FORM OF AMENDED AND RESTATED MASTER SERVICING AGREEMENT
EXHIBIT 3
FORM OF CUSTODIAL AGREEMENT
EXHIBIT 4
UNDERWRITING GUIDE OF SELLER
EXHIBIT 5
FORM OF CERTIFICATE OF SELLER
EXHIBIT 6
FORM OF ASSIGNMENT FOR ADDITIONAL COLLATERAL AGREEMENTS
EXHIBIT 7
FORM OF NOTICE OF ASSIGNMENT TO AND ACKNOWLEDGMENT BY PURCHASER
EXHIBIT 8
FORM OF WARRANTY BILL OF SALE
EXHIBIT 9
FORM OF TRUST RECEIPT
EXHIBIT 10 FORM
OF FINAL TRUST RECEIPT AND CERTIFICATION
EXHIBIT 11 FORM
OF ANNUAL CERTIFICATION
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EXHIBIT 12
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
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THIRD AMENDED AND RESTATED MASTER MORTGAGE LOAN
PURCHASE AGREEMENT
This is a THIRD AMENDED AND RESTATED MASTER MORTGAGE LOAN
PURCHASE
AGREEMENT (this "Agreement"), dated as of November 1, 2005, by and
between
Morgan Stanley Mortgage Capital Inc., a New York corporation having
its
principal office at 1585 Broadway, New York, New York 10036, and
its successors
and assigns ("Purchaser"), and Morgan Stanley Credit Corporation, a
Delaware
corporation having its principal office at 2500 Lake Cook Road,
Riverwoods, IL
60015 ("Seller").
PRELIMINARY STATEMENT
Seller and Purchaser are parties to that certain Amended and
Restated
Master Mortgage Loan Purchase Agreement, dated as of March 1, 2000
(the
"Original Purchase Agreement"), pursuant to which Seller may sell,
from time to
time, to Purchaser, and Purchaser may purchase, from time to time,
from Seller,
certain groups of fixed- and adjustable-rate, residential first
mortgage loans
(the "Mortgage Loans") as set forth therein (each date on which a
closing of
such a sale occurs is referred to as a "Closing Date") on a
servicing-retained
basis. In addition, Purchaser and Seller are parties to that
certain Amended and
Restated Master Servicing Agreement, dated as of November 1, 2005
(the
"Servicing Agreement") pursuant to which Seller services and
administers each
Mortgage Loan for Purchaser, its successors and assigns from and
after the
respective Closing Date. At the present time, Purchaser and Seller
desire to
amend and restate the Original Purchase Agreement as amended and
restated by the
Amended and Restated Master Mortgage Loan Purchase Agreement dated
as of March
1, 2000 and further amended and restated by the Second Amended and
Restated
Master Mortgage Loan Purchase Agreement dated as of February 1,
2004, to make
certain modifications as set forth herein.
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, Purchaser and Seller
agree as
follows:
Section 1. Definitions.
For purposes of this Agreement, the following capitalized terms
shall
have the respective meanings set forth below. Other capitalized
terms used in
this Agreement and not defined herein shall have the respective
meanings set
forth in the form of Amended and Restated Master Servicing
Agreement.
"Additional Collateral": With respect to any Additional
Collateral
Mortgage Loan, the securities and other assets held in a Trading
Account subject
to a security interest securing such Additional Collateral Mortgage
Loan.
"Additional Collateral Mortgage Loan": A Mortgage Loan secured
by
Additional Collateral in the form of a security interest in the
securities and
other assets held in a Trading
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Account and that is identified by Seller as an Additional
Collateral Mortgage
Loan as to which the Additional Collateral is still required to be
provided.
"Additional Collateral Pledge Agreement": With respect to each
Additional Collateral Mortgage Loan, any pledge and security
agreement and
account control agreement in favor of Seller granting a security
interest and
other rights in a securities account to secure the related Mortgage
Loan.
"Adjustable Rate Mortgage Loan": A Mortgage Loan that provides for
the
adjustment of the Mortgage Interest Rate payable with respect
thereto in
accordance with the terms of the related Mortgage Note.
"Affiliate": With respect to any specified Person, any other
Person
controlling, controlled by or under common control with such
specified Person.
"Agreement": This Third Amended and Restated Master Mortgage
Loan
Purchase Agreement and all exhibits hereto, amendments hereof and
supplements
hereto.
"Appraised Value": With respect to any Mortgage Loan, the value of
the
related Mortgaged Property based upon the lesser of (i) the
appraisal, made for
the originator at the time of the origination of the Mortgage Loan,
and (ii) if
applicable, the sales price of the Mortgaged Property at such time
of
origination.
"Assignment": An assignment of the Mortgage, notice of transfer
or
equivalent instrument, sufficient under the laws of the
jurisdiction wherein the
related Mortgaged Property is located to reflect of record the sale
or transfer
of the Mortgage Loan, which assignment, notice of transfer or
equivalent
instrument may be in the form of one or more blanket assignments
covering
Mortgages securing Mortgaged Properties located in the same county,
if permitted
by applicable law and acceptable for recording by the applicable
recording
office. With respect to any Mortgage Loan registered with MERS, an
Assignment
shall include a notice of transfer sufficient under the governing
instruments of
MERS to reflect a transfer of the Mortgage Loan. An Assignment
shall include, as
applicable, such instruments as are necessary and sufficient under
the laws of
the jurisdiction where a Cooperative Apartment is located to
reflect of record
the sale or transfer of the Mortgage Loan and security interest in
the Mortgaged
Property affecting such Cooperative Apartment.
"Assumed Principal Balance": With respect to any Mortgage Loan as
of
any date of determination (i) the outstanding principal balance as
of the
Cut-off Date, after application of principal payments due on or
before such date
whether or not received, minus (ii) all amounts previously
distributed to
Purchaser with respect to such Mortgage Loan representing (a)
payments or other
recoveries of principal, or (b) advances of principal made pursuant
to Section
5.03 of the Amended and Restated Master Servicing Agreement.
"Balloon Mortgage Loan": Any Mortgage Loan which by its original
terms
or any modifications thereof provides for amortization beyond its
scheduled
maturity date.
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"Business Day": Any day other than (i) a Saturday or Sunday, or
(ii) a
day on which banking or savings associations in the States of New
York or
Illinois are authorized or obligated by law or executive order to
be closed.
"Certificate of Seller": A certificate signed by the Secretary or
one
of the Assistant Secretaries of Seller, substantially in the form
attached
hereto as Exhibit 5.
"Closing Date": For each Transaction, the date on which Seller
actually
sells to Purchaser, and Purchaser actually purchases from Seller,
the Mortgage
Loans listed on the Final Mortgage Loan Schedule attached to the
respective
Warranty Bill of Sale.
"Closing Documents": (i) With respect to the Initial Closing Date,
the
following documents:
(A) two
counterparts of this Agreement;
(B) two
counterparts of the Amended and Restated Master Servicing
Agreement;
(C) three
counterparts of the Custodial Agreement;
(D) the
Certificate of Seller, dated as of the Initial Closing
Date;
(E) the
Initial Custody Receipt, dated the Initial Closing Date;
and
(F) ten (10)
counterparts of a power of attorney in the form of
Exhibit A to the Amended and Restated Master Servicing
Agreement.
(ii) With respect to the Initial Closing Date and each subsequent
Closing Date,
the following documents:
(A) the Final
Mortgage Loan Schedule for the related Transaction;
(B) the
initial Custody Receipt (as defined in the Custody
Agreement) for the related Transaction, dated the Closing
Date, with only such exceptions noted on Schedule B thereto as
shall be acceptable to Purchaser;
(C) the
Warranty Bill of Sale with respect to the Mortgage Loans
for the related Transaction, dated the Closing Date:
(D) An
original assignment in the form of Exhibit 6 attached
hereto of the Additional Collateral Pledge Agreements with
respect to the Additional Collateral Mortgage Loans; and
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(E) The
assignment and notice of transfer by Morgan Stanley Credit
Corporation of the security interest on the Trading Accounts
from Seller to Purchaser.
"Commission": The United States Securities and Exchange
Commission
"Converted Mortgage Loan": A Convertible Mortgage Loan with respect
to
which the related Mortgagor has exercised its option to convert the
related
Mortgage Note from a Mortgage Note with an adjustable interest rate
to a
Mortgage Note with a fixed interest rate.
"Convertible Mortgage Loan": An Adjustable Rate Mortgage Loan with
a
Mortgage Note that contains an option of the Mortgagor to convert
the related
Mortgage Note from a Mortgage Note with an adjustable interest rate
to a
Mortgage Note with a fixed interest rate.
"Cooperative Apartment": A dwelling unit in a multi-dwelling
building
owned or leased by a cooperative housing corporation, which unit
the Mortgagor
has an exclusive right to occupy pursuant to the terms of a
proprietary lease in
accordance with the laws of the state in which the building is
located.
"Cooperative Loan": A Mortgage Loan evidenced by a Mortgage Note
and
secured by a first lien against (i) shares issued by a cooperative
housing
corporation and (ii) the related Mortgagors' leasehold interest in
the
Mortgagor's Cooperative Apartment. The security interest created in
the
Mortgagor's Cooperative Apartment and the proprietary lease shall
include the
following documentation, as required by the applicable laws of the
state in
which such Cooperative Apartment is located: (a) a security
agreement, (b) the
related UCC-1 Financing Statement, (c) an assignment of the
cooperative lease,
(d) the stock certificate evidencing ownership of such Cooperative
Apartment,
appropriately endorsed, or an equivalent stock power, (e) a
recognition
agreement, and (f) such other documents as are necessary and proper
for the
perfection of a lien against such Cooperative Apartment, all as are
required
under state law.
"Custodial Account": The separate trust account or accounts created
and
maintained pursuant to Section 4.04 of the Amended and Restated
Master Servicing
Agreement which shall be entitled "Morgan Stanley Credit
Corporation, in trust
for Morgan Stanley Mortgage Capital Inc.," or such other title as
is requested
by Purchaser.
"Custodial Agreement": The Custodial Agreement, among Seller,
Purchaser
and the Custodian for the retention of each Mortgage Note,
Mortgage, Assignment
and certain other portions of each Mortgage File, substantially in
the form
attached to this Agreement as Exhibit 3, as the same may be
amended, modified,
restated or supplemented from time to time.
"Custodian": The Custodian under the Custodial Agreement, or
its
successor.
"Cut-off Date": With respect to each Mortgage Loan, the first day
of
the month in which the related Closing Date occurs.
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"Deleted Mortgage Loan": A Mortgage Loan replaced or to be replaced
by
a Qualified Substitute Mortgage Loan.
"Due Date": As to any Mortgage Loan, the day each Monthly Payment
is
due on such Mortgage Loan, exclusive of any days of grace.
"Equity Refinanced Mortgage Loan": A Refinanced Mortgage Loan in
which
the Mortgagor used less than the entire amount of the proceeds (net
of any
closing costs, including discount and origination fees and prepaid
items) to
refinance an existing mortgage loan and any junior lien that
existed on the
related Mortgaged Property at the date of origination of the
Refinanced Mortgage
Loan.
"Exchange Act": The Securities Exchange Act of 1934, as
amended.
"Fannie Mae": Fannie Mae, f/k/a the Federal National Mortgage
Association, or any successor organization.
"Fannie Mae Guides": The Fannie Mae Sellers' Guide and the Fannie
Mae
Servicers' Guide, and all amendments or additions thereto."
"Final Mortgage Loan Schedule": The list of Mortgage Loans for
a
Transaction, which list shall set forth the following information
with respect
to each Mortgage Loan:
(i) the loan
number;
(ii)
the Mortgagor's name;
(iii) the
street address of the Mortgaged Property, including city,
state and zip code;
(iv)
the Mortgage Interest Rate at origination;
(v) for each
Adjustable Rate Mortgage Loan, the first Interest
Rate Adjustment Date and the first Payment Adjustment Date;
(vi)
for each Adjustable Rate Mortgage Loan, the Gross Margin;
(vii) for
each Adjustable Rate Mortgage Loan, the Lifetime Rate Cap;
(viii) for each
Adjustable Rate Mortgage Loan, the Periodic Rate Cap;
(ix)
the original term to maturity;
(x) the
original principal balance;
(xi)
the first payment date;
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(xii) the
maturity date;
(xiii) the
Monthly Payment in effect as of the related Cut-off Date;
(xiv) the
principal balance as of the related Cut-off Date, after
giving effect to all payments of principal due on or before
such date, whether or not received;
(xv)
the Loan-to-Value Ratio as of the date origination;
(xvi) a
code indicating whether the Mortgaged Property is occupied
by Mortgagor;
(xvii) a code
indicating the type of residential dwelling;
(xviii) a code
indicating whether the Mortgage Loan is a purchase
mortgage loan, rate/term refinance loan, limited cash-out loan
or cash-out refinance
loan;
(xix) a
code indicating whether the Mortgage Loan is covered by a
Primary Mortgage Insurance Policy;
(xx)
a code indicating whether the Mortgage Loan is a Limited
Documentation Mortgage Loan;
(xxi) a
code indicating whether the Mortgage Loan is an Additional
Collateral Mortgage Loan;
(xxii) for each
Adjustable Rate Mortgage Loan, a code indicating the
type of Index;
(xxiii) a code
indicating whether the Mortgage Loan is a Balloon
Mortgage Loan;
(xxv) the
Servicing Fee Rate applicable to such Mortgage Loan, and
if such Mortgage Loan is an Adjustable Rate Mortgage Loan
whose first Interest Rate Adjustment has not occurred, the
Servicing Fee Rate (if different) prior to the first Interest
Rate Adjustment Date;
(xxvi) a code
indicating whether the Mortgage Loan is a Convertible
Mortgage Loan;
(xxvii) a code
indicating whether the Mortgagor is self-employed;
(xxviii) a code indicating the value of the Mortgagor's assets
at
origination;
(xxix) Appraised
Value; and
(xxx) a
code indicating the Primary Mortgage Insurance Policy
provider and percent of coverage, if applicable.
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Such schedule shall also set forth the weighted average of the
amounts described
under (iv) above for all of the Mortgage Loans. Such list may be in
the form of
more than one list, collectively setting forth all of the
information required.
"Fixed Rate Mortgage Loan": A Mortgage Loan that provides for a
fixed
Mortgage Interest Rate over the term of the related Mortgage
Note.
"Freddie Mac": Freddie Mac, f/k/a the Federal Home Loan
Mortgage
Corporation, or any successor organization.
"Gross Margin": With respect to each Adjustable Rate Mortgage Loan,
the
fixed number of basis points set forth in the Final Mortgage Loan
Schedule that
is added to the Index on each Interest Rate Adjustment Due Date in
accordance
with the terms of the related Mortgage Note to determine the
Mortgage Interest
Rate for such Mortgage Loan, subject to any applicable Periodic
Rate Cap and
Lifetime Rate Cap.
"High Cost Loan": A Mortgage Loan classified as (a) a "high cost"
loan
under the Home Ownership and Equity Protection Act of 1994 or (b) a
"high cost
home," "threshold," "covered," "high risk home," "predatory" or
similar loan
under any other applicable state, federal or local law (or a
similarly
classified loan using different terminology under a law imposing
heightened
regulatory scrutiny or additional legal liability for residential
mortgage loans
having high interest rates, points and/or fees).
"Index": With respect to each Adjustable Rate Mortgage Loan and
each
Interest Rate Adjustment Date, the index used to determine the
Mortgage Interest
Rate on such Adjustable Rate Mortgage Loan, as specified in the
related Mortgage
Note, in each case as available the number of days prior to any
Interest Rate
Adjustment Date set forth in the related Mortgage Note, which index
may be (i)
the average of the London Interbank Offered Rates for one- or
six-month U.S.
dollar deposits, as published in the "Money Rates" table of The
Wall Street
Journal or elsewhere (as specified in the related Mortgage Note) on
the date or
dates specified in such Mortgage Note for the determination of such
rate, (ii)
the weekly average of the closing market bid yields on actively
traded U.S.
Treasury securities adjusted to a constant maturity of one year,
(iii) the
weekly average or the monthly average of weekly average auction
rates on U.S.
Treasury bills with a maturity of six months, as published by the
Board of
Governors of the Federal Reserve System in Federal Reserve
Statistical Release
H.15. (519), (iv) the weekly average of the closing market bid
yields on U.S.
Treasury securities adjusted to a constant maturity of one (1)
year, as
published by the Board of Governors of the Federal Reserve System
in Federal
Reserve Statistical Release H.15. (519), (v) the weekly average of
the closing
market bid yields on U.S. Treasury securities adjusted to a
constant maturity of
five (5) years, as published by the Board of Governors of the
Federal Reserve
System in Federal Reserve Statistical Release H.15. (519), (vi) the
prime rate
specified in the related Mortgage Note, as published in the "Money
Rates" table
of The Wall Street Journal, or elsewhere (as specified in such
Mortgage Note),
(vii) the monthly weighted average cost of funds of members of the
Federal Home
Loan Bank of San Francisco, (viii) such other standard for
determining the
change in the interest rate as may be set
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forth in the related Mortgage Note, or (ix) if such index is not so
published or
is otherwise unavailable, such comparable alternative index
selected by Seller
in accordance with the terms of the Mortgage Notes and in
consultation with
Purchaser.
"Initial Closing Date": The first Closing Date to occur.
"Initial Custody Receipt": For each Transaction, the initial
Custody
Receipt, executed by the Purchaser or the Custodian with respect to
the Mortgage
Loans for such Transaction, substantially in the form of Exhibit
One to the
Custodial Agreement.
"Interest Rate Adjustment Date": With respect to each Adjustable
Rate
Mortgage Loan, the date on which the Mortgage Interest Rate is
adjusted in
accordance with the terms of the related Mortgage Note.
"Lifetime Rate Cap": With respect to each Adjustable Rate
Mortgage
Loan, the maximum Mortgage Interest Rate that may be borne thereby,
as set forth
in the related Mortgage Note.
"Limited Documentation Mortgage Loan": A Mortgage Loan that was
originated pursuant to a "limited documentation" or "easy
qualifier"
underwriting program.
"Loan-to-Value Ratio" or "LTV": With respect to any Mortgage Loan,
as
of any date on which a determination thereof is made, the ratio on
such date of
the outstanding principal balance of such Mortgage Loan to the
Appraisal Value
of the related Mortgaged Property.
"MERS": Mortgage Electronic Registration Systems, Inc.
"Monthly Payment": The scheduled monthly payment of interest and,
when
applicable, principal on a Mortgage Loan which is payable by a
Mortgagor from
time to time under the related Mortgage Note on every Due Date.
"Mortgage": The mortgage, trust deed or other instrument securing
the
respective Mortgage Loan, as the same may be amended, modified,
restated or
supplemented from time to time.
"Mortgage File": As to any Mortgage Loan, the mortgage, any
related
mortgage documents and, if the Mortgaged Property is a Cooperative
Apartment,
all documents relating to the security interest in a Cooperative
Apartment,
including but not limited to all paper, computer generated and
microfiche
records, pertaining to a particular Mortgage Loan which are
specified in Exhibit
1 hereto and any additional documents required to be added to the
Mortgage File
pursuant to the Program Documents.
"Mortgage Interest Rate": The annual rate at which interest accrues
on
any Mortgage Loan, net of any premium on any related Primary
Mortgage Insurance
Policy and any continuing compensation paid to correspondent
lenders; provided
that, with respect to any Adjustable Rate
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Mortgage Loan, the term "Mortgage Interest Rate" shall mean the
annual rate
applicable thereto as the same may be adjusted on any Interest Rate
Adjustment
Date and subject to the limitations on such interest rate imposed
by the
Periodic Rate Cap and the Lifetime Rate Cap.
"Mortgage Loan": An individual Mortgage Loan, including but not
limited
to all documents included in the Mortgage File, Monthly Payments,
principal
prepayments, insurance proceeds, condemnation proceeds, liquidation
proceeds,
and any and all rights, benefits, proceeds and obligations arising
therefrom or
in connection therewith, and which is the subject of this
Agreement. Each
Mortgage Loan set forth on the Final Mortgage Loan schedule
attached to a
Warranty Bill of Sale will initially be subject to this Agreement,
commencing on
the respective Closing Date for the related Transaction.
"Mortgage Loan Documents": With respect to each Mortgage Loan,
the
documents specified in Section 3(b) of this Agreement, which
documents Seller
shall deliver to the Purchaser or Custodian pursuant thereto.
"Mortgage Loan Payments": With respect to each Mortgage Loan (i)
all
scheduled principal due after the related Cut-off-Date, (ii) all
other
recoveries of principal collected after the related Cut-off Date
and collected
by Seller after the related Cut-off Date, and (iii) all payments of
interest on
the Mortgage Loans at the Mortgage Loan Remittance Rate minus that
portion of
any such payment that is allocable to the period prior to the
related Cut-Off
Date; provided, however, that payments of scheduled principal and
interest
prepaid for a due date beyond the related Cut-off Date shall not be
applied to
the principal balance as of the related Cut-off Date and that such
principal and
such prepaid amounts (minus interest at the Servicing Fee Rate)
shall constitute
a part of the Mortgage Loan Payments, which prepaid amounts Seller
shall deposit
into the related Custodial Account established for the benefit of
Purchaser for
subsequent remittance by Seller to Purchaser pursuant to the
Amended and
Restated Master Servicing Agreement.
"Mortgage Loan Remittance Rate": With respect to each Mortgage
Loan,
the related Mortgage Interest Rate minus the Servicing Fee
Rate.
"Mortgage Note": The note or other evidence of the indebtedness of
a
Mortgagor secured by a Mortgage.
"Mortgaged Property": The underlying real property securing
repayment
of a Mortgage Note, consisting of a fee simple or leasehold
interest in a single
parcel of real property improved by a residential dwelling or a
single
Cooperative Apartment including the stock certificates evidencing
ownership in
such Cooperative Apartment, the proprietary lease and all attendant
right, title
and interest thereto.
"Mortgagor": The obligor on a Mortgage Note.
"Payment Adjustment Date": With respect to each Adjustable Rate
Mortgage Loan, the first date on which payments thereon may be
adjusted and all
subsequent such dates of
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adjustment, as set forth in the related Final Mortgage Loan
Schedule and in the
related Mortgage Note.
"Periodic Rate Cap": With respect to each Adjustable Rate Mortgage
Loan
as to which the related Final Mortgage Loan Schedule indicates the
existence of
Periodic Rate Cap, the provision of the related Mortgage Note that
provides for
a maximum amount by which the Mortgage Interest Rate may increase
(or, if so
indicated on such Final Mortgage Loan Schedule, decrease) on an
Interest Rate
Adjustment Date above the Mortgage Interest Rate immediately prior
to such
Interest Rate Adjustment Date.
"Person": Any individual, corporation, partnership, limited
liability
company, joint venture, association, joint-stock company, trust,
unincorporated
organization or government or any agency or political subdivision
thereof.
"Preliminary Mortgage Loan Schedule": The initial list of
Mortgage
Loans for a proposed Transaction, which list shall set forth at
least the
information with respect to each Mortgage Loan described in items
(i), (ii),
(iv), (ix), (xii), (xiii), (xiv), (xvi), (xx), (xxi), (xxii) and
(xxiii) of the
definition of "Final Mortgage Loan Schedule". The Preliminary
Mortgage Loan
Schedule may be electronically delivered to Purchaser.
"Primary Mortgage Insurance Policy": With respect to each
Mortgage
Loan, the policy of primary mortgage insurance, if any, in effect
as indicated
on the related Final Mortgage Loan Schedule, or any replacement
policy therefor
obtained by Seller pursuant to the Amended and Restated Master
Servicing
Agreement.
"Program Documents": With respect to each Transaction, the
related
Purchase Price and Terms Letter, the related Warranty Bill of Sale,
the Amended
and Restated Master Servicing Agreement, the Custodial Agreement,
this Agreement
and each other document or instrument executed or delivered by
Seller in
connection with any of the foregoing.
"Purchase Price": With respect to each Mortgage Loan listed on
the
Final Mortgage Loan Schedule for a Transaction the price paid on
the related
Closing Date by Purchaser to Seller in exchange for such Mortgage
Loan, which
amount shall equal the sum of (i) the related Purchase Price
Percentage
multiplied by the unpaid principal balance of such Mortgage Loan as
of the
related Cut-off Date, after application of scheduled payments of
principal due
on or before such Cut-off Date whether or not collected, and (ii)
interest
scheduled to accrue on the unpaid principal balance of such
Mortgage Loan at the
Mortgage Loan Remittance Rate, from the related Cut-off Date to the
day prior to
the related Closing Date, inclusive.
"Purchase Price and Terms Letter": with respect to each
Transaction,
the letter agreement or agreements setting forth the general terms
and
conditions of such Transaction to be consummated as provided
herein, with a copy
of the related Preliminary Mortgage Loan Schedule, if requested by
Purchaser, by
and between Seller and Purchaser. The related Purchase Price and
Terms Letter
shall set forth among other matters, (i) the approximate dollar
amount of
Mortgage Loans for the related Transaction, (ii) the related
Cut-off Date, (iii)
the proposed
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Closing Date, (iv) the related Purchase Price Percentage, (v) the
related
Servicing Fee Rate, and (vi) the characteristics, including the
characteristics
set forth in the related Warranty Bill of Sale, for the related
Mortgage Loans,
both individually and in the aggregate. All of the individual
Purchase Price and
Terms Letters shall be referred to, collectively, as the "Purchase
Price and
Terms Letter".
"Purchase Price Percentage": With respect to each Mortgage Loan,
the
percentage of par set forth in the related Purchase Price and Terms
Letter
(subject to adjustment as provided therein) at which Purchaser will
purchase the
Mortgage Loan from Seller on the Closing Date.
"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
from time to time, 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.
"Qualified Substitute Mortgage Loan": A Mortgage Loan substituted
by
Seller for a Deleted Mortgage Loan which must, on the date of such
substitution
(i) have an outstanding principal balance, after deduction of all
scheduled
payments due in the month of substitution (or in the case of a
substitution of
more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal
balance), not in excess of the outstanding principal balance of the
Deleted
Mortgage Loan (the amount of any shortfall to be deposited into the
Custodial
Account by Seller in the month of substitution pursuant to Section
4.04 (vii) of
the Amended and Restated Master Servicing Agreement), (ii) have a
Mortgage
Interest Rate which is within one percent (1%) per annum of the
Deleted Mortgage
Loan, (iii) have a remaining term to maturity not greater than (and
not more
than one year less than) that of the Deleted Mortgage Loan, and
(iv) comply with
each representation and warranty set forth Section 5(b) of this
Agreement.
"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
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<PAGE>
(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.
"Refinanced Mortgage Loan": A Mortgage Loan that was made to a
Mortgagor who owned the Mortgaged Property prior to the origination
of such
Mortgage Loan and the proceeds of which (net of any closing costs,
including
discount and origination fees and prepaid items) were used in whole
or part to
satisfy an existing mortgage.
"Securities Act": The Securities Act of 1933, as amended.
"Securitization Transfer": 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.
"Servicing Criteria": The "servicing criteria" set forth in
Item
1122(d) of Regulation AB, as such may be amended from time to
time.
"Servicing Fee": With respect to any Mortgage Loan and any
Remittance
Date, the fee payable monthly to Seller, as servicer, under Section
7.03 of the
Amended and Restated Master Servicing Agreement.
"Servicing Fee Rate": With respect to each Mortgage Loan, the rate
per
annum set forth in the related Final Mortgage Loan Schedule as the
"Servicing
Fee Rate".
"Static Pool Information": Static pool information as described in
Item
1105(a)(1)-(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 1122(d)
of Regulation
AB with respect to Mortgage Loans under the direction or authority
of the Seller
or a Subservicer.
"Subsequent Purchaser": Any Person that acquires an interest in
a
Mortgage Loan from Purchaser.
"Subservicer": Any Person that services Mortgage Loans on behalf of
the
Seller 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
Seller under
this Agreement or any Reconstitution Agreement that are identified
in Item
1122(d) of Regulation AB.
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"Surety Bond Issuer": Shall mean AMBAC Assurance Corporation or
any
successor thereto.
"Third-Party Originator": Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the
Seller.
"Trading Account": With respect to any Additional Collateral
Mortgage
Loan as to which a Additional Collateral Pledge Agreement was made,
the account
in which is held the securities and other assets that are subject
to such
Additional Collateral Pledge Agreement.
"Transaction": The sale by Seller to Purchaser, and the purchase
by
Purchaser from Seller, of one or more Mortgage Loans on a Closing
Date, as
evidenced by the execution and delivery by Seller to Morgan Stanley
Mortgage
Capital, Inc. as the initial Purchaser, of the Warranty Bill of
Sale.
"Underwriting Guide": The Underwriting Guide of Seller attached
hereto
as Exhibit 4, as amended, modified, restated or supplemented from
time to time.
"Warranty Bill of Sale": The warranty bill of sale executed and
delivered by Seller to Purchaser on a Closing Date, evidencing the
sale of the
related Mortgage Loans by Seller to Purchaser and setting forth
certain
representations and warranties of Seller with respect thereto, in
the form
attached hereto as Exhibit 8.
"Whole Loan Transfer": Any sale or transfer of some or all of
the
Mortgage Loans, other than a Securitization Transaction.
Section 2. Purchase of Mortgage Loans.
(a) Sale and
Conveyance of Mortgage Loans. From time to time
Seller may offer to sell to Purchaser, and Purchaser may elect to
purchase form
Seller, Mortgage Loans in one or more Transactions pursuant to the
terms and
conditions of the Program Documents. The agreement of Seller to
sell to
Purchaser and of Purchaser to purchase from Seller, Mortgage Loans
on a
particular Closing Date shall be evidenced by the execution of a
Purchase Price
and Terms Letter. The obligation of Purchaser to purchase any
Mortgage Loan from
Seller on any particular Closing Date shall be subject to the
satisfaction of
the conditions precedent to Purchaser's obligation to purchase set
forth in
Section 2(b). The sale of each Mortgage Loan shall be reflected in
Seller's
balance sheet and other financial statements as a sale of assets by
Seller.
(b) Conditions of Closing. On each respective Closing Date (i)
Seller
will sell, transfer, assign, set over and convey to purchaser
without recourse,
all of the right, title and interest of Seller in and to the
Mortgage Loans
included in such Transaction, including all Mortgage Loan Payments,
and (ii)
Purchaser shall pay to Seller, by wire transfer of immediately
available funds
to the account of Seller, the Purchase Price for each Mortgage Loan
included in
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<PAGE>
such Transaction,
subject to the satisfaction of the following conditions to
Purchaser's
obligation to purchase the Mortgage Loans:
(A) All of the
representation and warranties of Seller under the
Program Documents shall be true and correct in all material
respects as of the Closing Date, and no event shall have
occurred that, with notice or the passage of time, would
constitute a default under any Program Document, including an
Event of Default under the Amended and Restated Master
Servicing Agreement;
(B) Purchaser
shall have received, or Purchaser's attorneys shall
have received in escrow, the Closing Documents, in such forms
as are agreed upon and as are acceptable to Purchaser, duly
executed by all signatories other than Purchaser required
pursuant to the respective terms thereof:
(C) Seller
shall have delivered and released to Purchaser or the
Custodian all documents required under the Program Documents;
and
(D) Seller
shall have complied with all other terms and conditions
of this Agreement.
(c) Record Title
and Possession of Mortgage Files. From and after
the sale of each Mortgage Loan, the contents of the related
Mortgage File and
all rights, benefits, proceeds and obligations arising therefrom or
in
connection therewith, shall be transferred to, and assumed by,
Purchaser. All
rights, arising out of each Mortgage Loan, including, but not
limited to, all
funds received on or in connection with such Mortgage Loans and all
records or
documents with respect to such Mortgage Loan prepared by or which
come into the
possession of Seller shall be received and held by Seller in trust
for the
benefit of Purchaser as the owner of the Mortgage Loan. Any portion
of the
Mortgage File held by Seller for servicing purposes shall be
appropriately
marked to clearly reflect ownership of the Mortgage Loan by
Purchaser and Seller
shall promptly release such portion of the Mortgage File to
Purchaser, when
Seller's servicing needs no longer necessitate retaining such
documents.
Section 3. Delivery Requirements.
(a) Final
Mortgage Loan Schedules. On or before the date on which
Seller and Purchaser execute a Purchase Price and Terms Letter,
Seller shall
provide Purchaser with the respective Preliminary Mortgage Loan
Schedule. Not
less than one (1) Business Day prior to the related Closing Date,
Seller either
(i) shall deliver the related Final Mortgage Loan Schedule to
Purchaser or (ii)
shall deliver to Purchaser all information with respect to the
Mortgage Loans to
be sold to Purchaser on such Closing Date that is necessary to
enable Purchaser
to prepare the related Final Mortgage Loan Schedule, which
information shall be
delivered on a computer disk on a machine-readable tape or in such
other format
as Purchaser may reasonably specify.
(b) Delivery of
Mortgage Loan Documents. Seller is currently in
possession of the following original Mortgage Loan Documents for
each Mortgage
Loan:
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<PAGE>
(A) the original Mortgage Note bearing all intervening
endorsements, endorsed "Pay to the order of _________, without
recourse" and
signed in the name of the Seller by an authorized officer. To the
extent that
there is no room on the face of the Mortgage Notes for
endorsements, the
endorsement may be contained on an allonge, if state law so allows
and the
custodian is so advised by the Seller that state law so allows;
and
(B) the original Mortgage with evidence of recording thereon.
If in connection with any Mortgage Loan, the Seller cannot deliver
or cause to
be delivered the original Mortgage with evidence of recording
thereon on or
prior to the Closing Date because of a delay caused by the public
recording
office where such Mortgage has been delivered for recordation or
because such
Mortgage has been lost or because such public recording office
retains the
original recorded Mortgage, the Seller shall deliver or cause to be
delivered to
the custodian, a photocopy of such Mortgage, together with (i) in
the case of a
delay caused by the public recording office, an Officer's
Certificate of the
Seller stating that such Mortgage has been dispatched to the
appropriate public
recording office for recordation and that the original recorded
Mortgage or a
copy of such Mortgage certified by such public recording office to
be a true and
complete copy of the original recorded Mortgage will be promptly
delivered to
the custodian upon receipt thereof by the Seller; or (ii) in the
case of a
Mortgage where a public recording office retains the original
recorded Mortgage
or in the case where a Mortgage is lost after recordation in a
public recording
office, a copy of such Mortgage certified by Seller to be a true
and complete
copy of the original recorded Mortgage;
(D) The original policy of title insurance, if applicable (or
a preliminary title report if the original title insurance policy
has not been
received from the title insurance company or if a preliminary title
report is
the documentation required by Seller).
(E) the originals of all assumption, modification,
consolidation or extension agreements, if any, with evidence of
recording
thereon;
(F) the original Assignment of Mortgage for each Mortgage
Loan, executed in blank and in form and substance acceptable for
recording;
(G) the originals of all intervening assignments of mortgage
with evidence of recording thereon, or if any such intervening
assignment has
not been returned from the applicable recording office or has been
lost or if
such public recording office retains the original recorded
assignments of
mortgage, the Seller shall deliver or cause to be delivered to the
custodian, a
photocopy of such intervening assignment, together with (i) in the
case of a
delay caused by the public recording office, an Officers
Certificate of the
Seller stating that such intervening assignment of mortgage has
been dispatched
to the appropriate public recording office for recordation and that
such
original recorded intervening assignment of mortgage or a copy of
such
intervening assignment of mortgage certified by the appropriate
public recording
office to be a true and complete copy of the original recorded
intervening
assignment of mortgage will be promptly delivered to the custodian
upon receipt
thereof by the Seller; or (ii) in the case of an intervening
assignment where a
public recording office retains the original
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<PAGE>
recorded intervening assignment or in the case where an intervening
assignment
is lost after recordation in a public recording office, a copy of
such
intervening assignment certified by Seller to be a true and
complete copy of the
original recorded intervening assignment;
(H) With respect to the Additional Collateral Mortgage Loan, a
copy of any related pledge, security or control agreement, as the
case may be.
(I) With respect to the Additional Collateral Mortgage Loan, a
copy of any filed UCC-1 financing statements or, if the UCC-1 has
not yet been
returned from the recording office, a copy of such UCC-1 which has
been
delivered for recording and an original form UCC-3 assignment, if
applicable.
If (1) the original Mortgage was not delivered pursuant to
clause (B) above, (2) any original intervening assignment was not
delivered
pursuant to clause (F) above or (3) the original title insurance
policy was not
delivered pursuant to clause (C) above, Seller shall use reasonable
efforts to
promptly secure the delivery of such originals and shall cause such
originals to
be delivered to Purchaser or the Custodian promptly upon receipt
thereof. If any
such document is not so delivered to Purchaser or the Custodian
within one
hundred eighty (180) days following the Closing Date (or such
longer period of
time as may be necessitated solely as a result in delays caused by
a party other
than the Seller), the related Mortgage Loan shall, upon the request
of
Purchaser, (i) be repurchased by Seller at the price specified in
Section 5(c),
or (ii) be replaced by a Qualified Substitute Mortgage Loan (the
election of (i)
or (ii) being at the option of Purchaser), provided that the
Purchaser gives the
Seller notice within ten (10) days of the expiration of such
delivery period.
No Assignment of Mortgage evidencing the transactions
contemplated hereby shall be recorded by Seller unless required by
law.
Purchaser may at its option and expense (including recordation
fees) prepare and
record any Assignment of Mortgage.
From and after the related Closing Date, Seller, as bailee
(the "Bailee"), shall continue to hold the Mortgage Files as
custodian and
bailee for the Purchaser, the owner of the related Mortgage Loans,
and shall
issue in the name of the Purchaser or its designee, a trust receipt
in the form
of Exhibit 9 hereto (the "Trust Receipt") evidencing the ownership
of the
Mortgage Loans related thereto.
At the Purchaser's request, the Bailee shall issue, within 2
Business Days from such request, a final trust receipt and
certification
evidencing the Purchaser's ownership of the related Mortgage Loans
in the form
of Exhibit 10 hereto (the "Final Trust Receipt and Certification"),
which Final
Trust Receipt and Certification shall have attached thereto a list
of document
exceptions, if any, based upon the documents to be contained in the
Mortgage
File as listed above.
Upon 3 Business Days prior written notice from the Purchaser
to the Bailee, the Bailee shall deliver or cause to be delivered to
the
Purchaser or any party designated in such notice, the Mortgage
Files, and shall
release them to the Purchaser or its designee in accordance
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<PAGE>
with the directions of the Purchaser. Such delivery date(s) shall
herein be
known as release date(s) (each, a "Release Date").
In the event that the Bailee fails to deliver any Mortgage
File, or any component thereof, in connection with the Purchaser's
instructions,
the Bailee shall indemnify the Purchaser for and hold the Purchaser
harmless
against any and all liability, costs and expenses (including
attorneys' fees)
arising out of such failure to deliver any Mortgage File.
From and after the Closing Date and until the applicable
Release Date, the Bailee shall maintain continuous custody and
control of the
Mortgage Files as custodian and bailee for the Purchaser.
(c) Purchaser hereby acknowledges that Seller may register the
Mortgages subject to this Agreement with MERS as a nominee for
Seller, either
through the recordation of a mortgage or deed of trust which shows
MERS as a
nominee for Seller or by the recordation of an Assignment which
shows MERS as a
nominee for Seller, for purposes of facilitating the transfer of
the Mortgage
Loan and/or Mortgage Loan Documents. Purchaser and Seller hereby
acknowledge
that MERS will have no beneficial interest in the Mortgage Loan and
that the
registration of the Mortgage Loan with MERS will not in any way
affect the
rights, title, interest, obligations or responsibilities of
Purchaser and Seller
under the terms of this Agreement. Purchaser and Seller agree to
cooperate in
all ways necessary to effectuate the use of MERS for the purpose of
facilitating
the transfer of applicable Mortgage Loan Documents, and
withstanding any other
provisions in this Agreement to the contrary, agree to accept such
documentation
and evidence of transfer provided by MERS under its operating
documents to
accomplish the transfer of ownership in the Mortgage Loan.
Section 4. Examination of Mortgage Files.
Prior to the respective Closing Date, Seller, shall make available
to
Purchaser, for examination, the Mortgage File pertaining to each
related
Mortgage Loan at the offices of Seller, or such other location as
Seller and
Purchaser shall mutually designate. Such examination may be made by
Purchaser of
the related Mortgage Loan at any time before the related Closing
Date and may be
made by Purchaser or any prospective Subsequent Purchaser of such
Mortgagee Loan
at any time after such Closing Date. If Purchaser makes such
examination prior
to the Closing Date and identifies any Mortgage Loan that does not
conform to
the terms of the Purchase Price and Terms Letter, such Mortgage
Loan shall be
deleted from the Final Mortgage Loan Schedule and may be replaced
by a
substitute Mortgage Loan that conforms to the terms of the Purchase
Price and
Terms Letter and that is reasonably acceptable to Purchaser.
Purchaser may, at
its option and without notice to Seller, purchase all or part of
the Mortgage
Loans for a Transaction without conducting any partial or complete
examination.
The failure or omission by Purchaser or any Subsequent Purchaser of
the Mortgage
Loans to conduct any partial or complete examination of the
Mortgage Files shall
not affect Purchaser's rights to demand repurchase or other relief
as provided
under any Program Document.
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<PAGE>
Section 5. Representations, Warranties and Agreements of
Seller.
(a)
Seller represents and warrants to Purchaser that as of the date
hereof and as of each respective Closing Date (or as of such other
date or dates
as may be expressly set forth below);
(i) Seller is duly incorporated, validly existing and in good
standing as a corporation under the laws of the State of
Delaware.
Seller has full power and authority, corporate and otherwise, to
own
its properties and conduct its business as presently conducted by
it,
and to enter
into and perform its obligations under the Program
Documents and to sell each Mortgage Loan. To the extent material
to
Purchaser's rights hereunder, Seller holds all material
licenses
necessary to carry on its business as now being conducted and
is
licensed in, qualified to transact business in and is in good
standing
under the laws of each state in which any Mortgaged Property is
located
if the laws of such state require licensing or qualification in
order
to conduct business of the type conducted by Seller, and in any
event
Seller was and is in compliance with the laws of any such state to
the
extent necessary to ensure the enforceability of each Mortgage
Loan.
(ii) This Agreement, the Amended and Restated Master Servicing
Agreement and the Custodial Agreement have been duly
authorized,
executed and delivered by Seller, and assuming the due
authorization,
execution and delivery thereof by Purchaser and the
enforceability
thereof against Purchaser, constitutes the legal, valid and
binding
agreement of Seller, enforceable against Seller in accordance with
its
terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, liquidation, moratorium, reorganization
or
other similar laws affecting the rights of creditors generally or
by
general principles of equity, regardless of whether enforcement
is
sought in a proceeding in equity or at law.
(iii) As of the respective Closing Date, the related Purchased
Price and Terms Letter has been duly authorized, executed and
delivered
by Seller, and such Purchase Price and Terms letter, assuming the
due
authorization, execution and delivery thereof by Purchaser and
the
enforceability thereof against Purchaser, constitutes the legal,
valid
and binding agreement of Seller, enforceable against Seller in
accordance with its terms, except as the enforceability thereof may
be
limited by bankruptcy, insolvency, liquidation, moratorium,
reorganization or other similar laws affecting the rights of
creditors
generally or by general principles of equity, regardless of
whether
enforcement is sought in a proceeding in equity or at law.
(iv) As of the respective Closing Date, the related Warranty
Bill of Sale has been duly authorized, executed and delivered
by
Seller, and such Warranty Bill of Sale constitutes the legal, valid
and
binding agreement of Seller, enforceable against Seller in
accordance
with its terms, except as the enforceability thereof may be limited
by
bankruptcy, insolvency, liquidation, moratorium, reorganization
or
other similar laws
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<PAGE>
affecting the rights of creditors generally or by general
principles of
equity,
regardless of whether enforcement is sought in a proceeding in
equity or at law.
(v) the representations and warranties made by Seller under
the Amended and Restated Master Servicing Agreement and the
related
Warranty Bill of Sale are true and correct in all material respects
as
of the respective Closing Date.
(vi) Neither the delivery of the Mortgage Loans to Purchaser,
nor the sale of the Mortgage Loans to Purchaser, nor the execution
or
delivery of the Program Documents, nor the consummation of any of
the
Transactions herein or therein contemplated, nor the fulfillment of
the
terms hereof or thereof, will result in the breach of any term
or
provision of the certificate of incorporation or by-laws of Seller,
or
conflict with, result in a material breach or cause an acceleration
of
or constitute a default under any material term of any material
indenture or other material agreement or instrument to which Seller
is
a party or by which Seller is bound, or any statute, order or
regulation applicable to Seller of any court, regulatory body,
administrative agency, government body or arbitrator having
jurisdiction over Seller.
(vii) There are no actions, proceedings or investigations
pending or, to Seller's knowledge, threatened against Seller that,
in
Seller's judgment, if determined adversely to Seller, would prevent
the
consummation of any of the Transactions or would materially and
aversely affect the interests of Purchaser in the Mortgage Loans,
taken
as a whole, the validity or enforceability of any of the
Program
Documents or the ability of Seller to fulfill the terms of any of
the
Program Documents.
(viii) Seller has complied with all applicable anti-money
laundering laws and regulations, including without limitation, the
USA
Patriot Act of 2001.
(b) Seller
hereby represents and warrants to Purchaser, as to each
Mortgage Loan as of each respective Closing Date or such other date
as may be
specified below, that:
(i) The information set forth in the Final Mortgage Loan
Schedule is true and correct in all material respects.
(ii) As of the related Closing Date, the Mortgage Loan is not
delinquent in payment more than 29 days and the Mortgage Loan has
not
been dishonored; there are no material defaults under the terms of
the
Mortgage Loan; Seller has not advanced funds, or induced, solicited
or
knowingly received any advance of funds from a party other than
the
owner of the Mortgaged
Property subject to the Mortgage, directly or
indirectly, for the payment of any amount required by the
Mortgage
Loan.
(iii) With respect to those Mortgage Loans which are required
to deposit funds into an escrow account for payment of taxes,
assessments, insurance premiums and similar items as they become
due,
there are no delinquent taxes, ground rents, water charges,
sewer
rents, assessments or other outstanding charges which constitute a
lien
on
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<PAGE>
the related Mortgaged Property, and all escrow deposits have
been
collected, are under the control of Seller, and have been applied
to
the
payment of such items in a timely fashion, in accordance with
such
Mortgage. With respect to those Mortgage Loans for which escrow
deposits are not required, to Seller's knowledge, there are no
delinquent taxes or other outstanding charges affecting the
related
Mortgaged Property which constitute a lien on the related
Mortgaged
Property.
(iv) The terms of the Mortgage Note and the Mortgage have not
been impaired, waived, altered or modified in any respect, except
by
written instruments contained in the Mortgage File, approved,
if
necessary, by the insurer under any Primary Mortgage Insurance
Policy
and recorded in all places necessary to maintain the first priority
of
the lien, the substance of which waiver, alteration or modification
is
reflected on the Final Mortgage Loan Schedule. No Mortgagor has
been
released, in whole or in part, except by operation of law or in
connection
with an assumption agreement which assumption agreement is
part of the Mortgage File and the terms of which are reflected in
the
Final Mortgage Loan Schedule.
(v) Neither the Mortgage Note nor the Mortgage is subject to
any right of rescission, set-off, counterclaim or defense,
including
the defense of usury, nor will the operation of any of the terms of
the
Mortgage Note and the Mortgage, or the exercise of any right
thereunder, render the Mortgage unenforceable, in whole or in part,
or
subject to any right of rescission, set-off, counterclaim or
defense,
including the defense of usury and, to Seller's knowledge, no
such
right of rescission, set-off, counterclaim or defense has been
asserted
by any Person with respect thereto.
(vi) All buildings upon the Mortgaged Property are required to
be insured by a generally acceptable insurer against loss by
fire,
hazards of extended coverage and such other hazards as are
customarily
included in extended coverage in the area where the Mortgaged
Property
is located, pursuant to standard property insurance policies in
compliance with Seller's policies as from time to time in effect.
To
the best knowledge of Seller, all such property policies are in
effect.
On the date of origination, such standard property policies
contained a
standard mortgage clause naming Seller or the originator of the
Mortgage Loan and their respective successors in interest as
mortgagee
and to the best knowledge of Seller, such clause is still in
effect
and, to Seller's knowledge, all premiums due thereon have been
paid. If
the Mortgaged Property is located in an area identified by the
Federal
Emergency Management Agency as having special flood hazards under
the
National Flood Insurance Act of 1994, as amended, such
Mortgaged
Property is covered by flood insurance in the amount required under
the
National Flood Insurance Act of 1994. The Mortgage obligates
the
Mortgagor to maintain such insurance, authorizes the holder of
the
Mortgage to maintain such insurance at Mortgagor's cost and
expense
should the Mortgagor fail to do so and to seek reimbursement
therefor
from the Mortgagor.
(vii) At the time of origination of such Mortgage Loan and
thereafter, all requirements of any federal or state law,
including,
without limitation, usury, truth-in-
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<PAGE>
lending, real estate settlement procedures, consumer credit
protection,
equal credit opportunity or disclosure laws required to be
complied
with by Seller as the originator of the Mortgage Loan and
applicable to
the Mortgage Loan have been complied with in all material
respects.
(viii) The Mortgage has not been satisfied as of the Closing
Date, canceled or subordinated, in whole, or rescinded, and the
Mortgaged Property has not been released from the lien of the
Mortgage,
in whole or in part (except for a release that does not
materially
impair the security of the Mortgage Loan or release the effect of
which
is reflected in the loan-to-value ratio for the Mortgage Loan as
set
forth in the Final Mortgage Loan Schedule), nor to Seller's
knowledge
has any instrument been executed that would effect any such
release,
cancellation, subordination or rescission.
(ix) Ownership of the Mortgaged Property is held in fee simple
or leasehold estate. With respect to Mortgage Loans that are
secured by
a leasehold estate, to Seller's knowledge: (i) the lease is valid,
in
full force and effect, and conforms to all of Fannie Mae's
requirements
for leasehold estates; (ii) all rents and other payments due under
the
lease have been paid; (iii) the lessee is not in default under
any
provision of the lease; (iv) the term of the lease exceeds the
maturity
date of the related Mortgage Loan by at least five (5) years; and
(v)
the terms of the lease provide a Mortgagee with an opportunity to
cure
any defaults. Except as permitted by the fifth sentence of this
paragraph (ix), the Mortgage is a valid, subsisting and
enforceable
first lien on the Mortgaged Property, including all buildings on
the
Mortgaged Property and all installations and mechanical,
electrical,
plumbing, heating and air conditioning systems affixed to such
buildings, and all additions, alterations and replacements made at
any
time with respect to the foregoing securing the Mortgage Note's
original principal balance. The Mortgage and the Mortgage Note do
not
contain any evidence on their face of any security interest or
other
interest or right thereto. Such lien is free and clear of all
adverse
claims, liens and encumbrances having priority over the first lien
of
the Mortgage subject only to (1) the lien of non-delinquent
current
real property taxes and assessments not yet due and payable,
(2)
covenants, conditions and restrictions, rights of way, easement
