REGULATION AB COMPLIANCE
ADDENDU M
TO SELLER’S PURCHASE, WARRANTIES AND SERVICING
AGREEMEN T
This Regulation AB Compliance Addendum
(this “ Reg AB Addendum ”), dated as of
September 1, 2006, by and between SunTrust Asset Funding, LLC (the
“ Purchaser ”) and SunTrust Mortgage, Inc. (the
“ Seller ”), to that certain Seller’s
Purchase, Warranties and Servicing Agreement, dated as of November
1, 2005, by and between the Seller and the Purchaser (as amended,
modified or supplemented, the “ Agreement
”).
WITNESSETH
WHEREAS, the 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 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.
Seller Information
: As defined in Section 2.07(a).
Depositor : With respect to any Securitization Transaction, the
person identified in writing to the Seller by the Purchaser as the
depositor for such transaction.
Exchange Act : The Securities Exchange Act of 1934, as
amended.
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.
Reconstitution : Any Securitization Transaction or Whole Loan
Transfer.
Regulation AB : Subpart 229.1100 – Asset Backed Securities
(Regulation AB), 17 C.F.R. §§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 Seller or a Subservicer.
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 identified in Item 1122(d) of Regulation AB that are
required to be performed by the Seller under this Agreement or any
Reconstitution Agreement.
Third-Party Originator
: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the
Seller.
Whole Loan Transfer
: Any sale or transfer by the Purchaser
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 .
The Purchaser and the Seller 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.
Although Regulation AB is applicable by its terms only to
offerings of asset-backed securities that are registered under the
Securities Act, the Seller 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
Seller 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 reasonable
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 Seller
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 Seller, 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 Seller 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.
Section 2.02. Additional
Representations and Warranties of the Seller .
(a) The Seller shall be deemed to
represent 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
Seller 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 Seller; (ii) the Seller 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 Seller as servicer has
been disclosed or reported by the Seller; (iv) no material changes
to the Seller’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 Seller’s financial condition that
are expected to have a material adverse effect on the performance
by the Seller 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 Seller, any Subservicer or any Third-Party Originator;
and (vii) there are no affiliations, relationships or transactions
relating to the Seller, any Subservicer or any Third-Party
Originator with respect to any Securitization Transaction and any
party thereto identified in writing to the Seller 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 Seller
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 Seller .
In connection with any Securitization
Transaction, the Seller 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
Seller, 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.
(a) If so requested by the Purchaser or
any Depositor, the Seller shall provide such information regarding
(i) the Seller, 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 (so long as required by
Regulation AB):
(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 Seller, each Third-Party Originator and each
Subservicer; and
(D) a description of any affiliation or
relationship between the Seller, each Third-Party Originator, each
Subservicer and any of the following parties to a Securitization
Transaction, as such parties are identified to the Seller 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 Seller 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 Seller, if the Seller 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 Seller (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 Seller (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 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 Seller,
and need not be customized for the Purchaser or any Depositor.
Such Static Pool 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 Seller 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 Seller.
If so requested by the Purchaser or any
Depositor, the Seller 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
Seller’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 Seller shall provide such information regarding
the Seller, as servicer of the Mortgage Loans, and each Subservicer
(each of the Seller 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 (so long as required by
Regulation AB):
(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 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 Seller 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;
(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; and
(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 origina
