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EXHIBIT 10.2
WHOLE LOAN PURCHASE AND SALE AGREEMENT
MORTGAGE LOAN PURCHASE AND SALE AGREEMENT
between
MCA Financial Corp.
MCA Inc.
[MCA Mortgage Corp.]
Seller
and
PRUDENTIAL SECURITIES REALTY FUNDING CORPORATION
Purchaser
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TABLE OF CONTENTS
PAGE
Section 1. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. Procedures for Purchases of Mortgage Loans . . . . . . . . . . 8
Section 3. Sale of Mortgage Loans to Takeout Investor . . . . . . . . . . 9
Section 4. Completion Fee . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 5. Servicing of the Mortgage Loans. . . . . . . . . . . . . . . . 13
Section 6. Trade Assignments. . . . . . . . . . . . . . . . . . . . . . . 14
Section 7. Transfers of Beneficial Interest in Mortgage Loans by
Purchaser . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 8. Record Title to Mortgage Loans;
Intent of Parties; Security Interest. . . . . . . . . . . . . 15
Section 9. Representations and Warranties . . . . . . . . . . . . . . . . 16
Section 10. Covenants of Seller. . . . . . . . . . . . . . . . . . . . . . 24
Section 11. Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 12. Exclusive Benefit of Parties; Assignment . . . . . . . . . . . 28
Section 13. Amendments; Waivers; Cumulative Rights . . . . . . . . . . . . 28
Section 14. Execution in Counterparts. . . . . . . . . . . . . . . . . . . 28
Section 15. Effect of Invalidity of Provisions . . . . . . . . . . . . . . 28
Section 16. Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 17. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 18. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . 29
Section 19. Costs of Enforcement . . . . . . . . . . . . . . . . . . . . . 29
Section 20. Consent to Service . . . . . . . . . . . . . . . . . . . . . . 29
Section 21. Submission to Jurisdiction . . . . . . . . . . . . . . . . . . 29
Section 22. Jurisdiction Not Exclusive . . . . . . . . . . . . . . . . . . 29
(i)
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Section 23. Construction . . . . . . . . . . . . . . . . . . . . . . . . . 29
EXHIBITS
Exhibit A Trust Receipt
Exhibit B-1 Warehouse Lender's Release
Exhibit B-2 Warehouse Lender's Wire Instructions
Exhibit C-1 Seller's Release
Exhibit C-2 Seller's Wire Instructions
Exhibit D-1 Trade Assignment
Exhibit D-2 Trade Assignment (Blanket)
Exhibit 1 to
Exhibit D-2 Withdrawal of Consent to Blanket Trade Assignment
Exhibit E Purchaser's Wire Instructions
Exhibit F Confirmation
Exhibit G Notice of Rejection of Trade Assignment
Exhibit H Settlement Modification Letter
Exhibit I Takeout Confirmation
(ii)
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MORTGAGE LOAN PURCHASE AND SALE AGREEMENT
This Mortgage Loan Purchase and Sale Agreement ("Agreement"), dated
as of the date set forth on the cover page hereof, is by and between PRUDENTIAL
SECURITIES REALTY FUNDING CORPORATION ("Purchaser") and the Seller whose name
is set forth on the cover page hereof ("Seller").
PRELIMINARY STATEMENT
Seller may, in its sole discretion, offer to sell to Purchaser from
time to time a 100% undivided ownership interest in certain Mortgage Loans, and
Purchaser, in its sole discretion, may agree to purchase such Mortgage Loans
from Seller in accordance with the terms and conditions set forth in this
Agreement. Seller, subject to the terms hereof, will cause each Mortgage Loan
to be purchased by Takeout Investor. During the period from the purchase of a
Mortgage Loan to the sale of the Mortgage Loan to Takeout Investor, Purchaser
expects to rely entirely upon Seller to service such Mortgage Loan.
The parties hereto hereby agree as follows:
Section 1. Definitions.
Capitalized terms used but not defined herein shall have the meanings
set forth in the Custodial Agreement. As used in this Agreement, the following
terms shall have the following meanings:
"Act of Insolvency": With respect to Seller, (a) the commencement by
Seller as debtor of any case or proceeding under any bankruptcy,
insolvency, reorganization, liquidation, dissolution or similar law,
or Seller's seeking the appointment of a receiver, trustee, custodian
or similar official for Seller or any substantial part of its
property, or (b) the commencement of any such case or proceeding
against Seller, or another's seeking such appointment, or the filing
against Seller of an application for a protective decree which (1) is
consented to or not timely contested by Seller, (2) results in the
entry of an order for relief,such an appointment, the issuance of
such a protective decree or the entry of an order having a similar
effect, or (3) is not dismissed within thirty (30) days, (c) the
making by Seller of a general assignment for the benefit of
creditors, or (d) the admission in writing by Seller that Seller is
unable to pay its debts as they become due or the nonpayment
generally by Seller of its debts as they become due.
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"Assignee": As defined in Section 7.
"Business Day": Any day other than (a) a Saturday, Sunday or other
day on which banks located in The City of New York, New York are
authorized or obligated by law or executive order to be closed or (b)
any day on which Prudential Securities Realty Funding Corporation is
closed for business, provided that notice thereof shall have been
given not less than seven (7) calendar days prior to such day, and
provided further that such closing does not conflict with any
business between Seller and Purchaser scheduled for such date prior
to the giving of such notice.
"Collateral": As defined in Section 8(c).
"Commitment Amount": The aggregate outstanding principal amount of
Mortgage Loans to be purchased pursuant to a Takeout Commitment. If
the Commitment Amount is expressed as a fixed amount plus or minus a
percentage in the related Takeout Confirmation, then the amount
required to be delivered by Seller shall be the minimum amount of
such range and the amount required to be purchased by Takeout
Investor shall be the maximum amount of such range.
"Commitment Date": The date set forth in a Takeout Confirmation as
the commitment date.
"Commitment Guidelines": The guidelines, if any, issued by Takeout
Investor regarding the issuance of Takeout Commitments, as amended
from time to time by Takeout Investor.
"Commitment Number": With respect to a Takeout Commitment, the
number identified on the Takeout Confirmation as the commitment
number.
"Completion Fee": With respect to each Mortgage Loan Pool, an amount
equal to the Discount plus the Net Carry Adjustment, less any
reduction pursuant to Section 4(c), which amount shall be payable to
Seller by Purchaser as compensation to Seller for its services
hereunder in connection with the purchase of a Mortgage Loan
Pool.
"Confirmation": A written confirmation of Purchaser's intent to
purchase a Mortgage Loan Pool,
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which written confirmation shall be substantially in the form
attached hereto as Exhibit F.
"Credit File": All Mortgage Loan papers and documents required to be
maintained pursuant to the Sale Agreement, and all other papers and
records of whatever kind or description whether developed or
originated by Seller or others, required to document or service the
Mortgage Loan provided, however, that such Mortgage Loan papers,
documents and records shall not include any Mortgage Loan papers,
documents or records which are contained in the Custodial File.
"Cure Date": With respect to a Mortgage Loan, the date occurring 20
Business Days after the Purchase Date.
"Custodial Account": As defined in Section 5(b).
"Custodial Agreement": The Custodial Agreement, dated as of the date
set forth on the cover sheet thereof, among Seller, Purchaser and
Custodian.
"Custodial File": As defined in the Custodial Agreement.
"Custodian": The Custodian whose name is set forth on the cover page
of the Custodial Agreement and its permitted successors
thereunder.
"Cut-off Date": With respect to a Mortgage Loan, the last day of a
month on which the Settlement Date can occur if accrued interest for
such month is to be collected by Takeout Investor.
"Defective Mortgage Loan": With respect to any Mortgage Loan, either
(i) the Document File does not contain a document required to be
contained therein, (ii) any document within a Document File is, in
the judgment of Takeout Investor, defective or inaccurate in any
material respect, as determined upon evaluation of the Document File
against the requirements of the Sale Agreement or (iii) any document
in the Document File is not legal, valid and binding.
"Discount": With respect to Mortgage Loan Pool sold by Seller to
Purchaser, the amount set forth on the related Confirmation as
the Discount.
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"Document File": The Credit File and the Custodial File.
"Due Date": The day of the month on which the Monthly Payment is due
on a Mortgage Loan.
"Exhibit B-1 Letter": As defined in Section 2(a).
"Exhibit C-1 Letter": As defined in Section 2(a).
"Expiration Date": With respect to any Takeout Commitment, the
expiration date thereof.
"FDIC": Federal Deposit Insurance Corporation or any successor
thereto.
"FHLMC": Federal Home Loan Mortgage Corporation or any successor
thereto.
"FNMA": Federal National Mortgage Association or any successor
thereto.
"Losses": Any and all losses, claims, damages, liabilities or
expenses (including reasonable attorneys' fees) incurred by any
person specified; provided, however, that "Losses" shall not include
any losses, claims, damages, liabilities or expenses which would have
been avoided had such person taken reasonable actions to mitigate
such losses, claims, damages, liabilities or expenses.
"Monthly Payment": The scheduled monthly payment of principal and
interest on a Mortgage Loan.
"Mortgage": The mortgage, deed of trust or other instrument creating
a first lien on an estate in fee simple in real property securing a
Mortgage Note.
"Mortgage Interest Rate": The annual rate of interest borne on a
Mortgage Note.
"Mortgage Loan": A conventional single family residential mortgage
loan which is subject to this Agreement, and which satisfies the
requirements of the Sale Agreement as the same may be modified from
time to time.
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"Mortgage Loan Pool": A group of Mortgage Loans purchased by
Purchaser hereunder and subject to a single Confirmation.
"Mortgage Note": The note or other evidence of the indebtedness of
a Mortgagor secured by a Mortgage.
"Mortgaged Property": The property subject to the lien of the
Mortgage securing a Mortgage Note.
"Mortgagor": The obligor on a Mortgage Note.
"NCUA": National Credit Union Administration, or any successor
thereto.
"Net Carry Adjustment": As defined in Section 4(b).
"Notice of Rejection of Trade Assignment": With respect to any
Mortgage Loan that Purchaser elects not to purchase, a notification
by Purchaser to Takeout Investor in the form of Exhibit G.
"OTS": Office of Thrift Supervision or any successor thereto.
"Parent Company": A corporation or other entity owning at least
50% of the outstanding shares of voting stock of Seller.
"Pass-Through Rate": With respect to each Mortgage Loan Pool
purchased by Purchaser hereunder, the rate at which interest from the
Mortgage is passed through to Purchaser which initially shall be the
rate of interest specified in the related Confirmation as the
Pass-Through Rate, subject to adjustment in the manner agreed
to by Purchaser and Seller.
"Price Adjustment": With respect to a Takeout Commitment, the
incremental percentage by which the trade price is adjusted by
applying the appropriate formula set forth in a price adjustment
summary sheet when delivered by Purchaser to Seller which price
adjustment summary sheet may be amended from time to time by
Purchaser's delivery to Seller of a new price adjustment summary
sheet.
"Purchase Date": With respect to any Mortgage Loan Pool purchased
by Purchaser hereunder, the date of
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payment thereof by Purchaser to Seller of the Purchase Price.
"Purchase Price": With respect to each Mortgage Loan Pool purchased
by Purchaser hereunder, an amount equal to the Trade Principal less
an amount equal to the product of the Trade Principal and the
Discount.
"Purchaser": Prudential Securities Realty Funding Corporation and
its successors in interest, including, but not limited to, a party to
whom a Trust Receipt is assigned as provided hereunder and in the
Custodial Agreement.
"Purchaser's Wire Instructions": The wire instructions set forth in
a letter in the form of Exhibit E.
"RTC": Resolution Trust Corporation or any successor thereto.
"Sale Agreement": The agreement providing for the purchase by
Takeout Investor of Mortgage Loans from Seller.
"Seller": The Seller whose name is set forth on the cover page
hereof, and its permitted successors hereunder.
"Seller's Wire Instructions": The wire instructions set forth in a
letter in the form of Exhibit C-2.
"Settlement Date": With respect to any Mortgage Loan, the date of
payment thereof by Takeout Investor to Purchaser of the Takeout
Proceeds.
"Settlement Modification Letter": A letter in the form of Exhibit
H.
"Successor Servicer": An entity designated by Purchaser, in
conformity with Section 17, to replace Seller as issuer and servicer,
mortgagee or seller/servicer of the Mortgage Loans evidenced by a
Trust Receipt.
"Takeout Commitment": A commitment of Seller to sell one or more
Mortgage Loans to Takeout Investor and of
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Takeout Investor to purchase one or more Mortgage Loans from Seller.
"Takeout Confirmation": The written notification to Seller from
Takeout Investor containing all of the relevant details of the
Takeout Commitment, including but not limited to the information set
forth in Exhibit I, which notification may take the form of a trade
confirmation.
"Takeout Investor": An Agency or a Conduit, as applicable.
"Takeout Proceeds": With respect to any Mortgage Loan Pool, the
related Trade Principal plus accrued interest as calculated in
accordance with Section 3(a)(2), as amended by any related
Settlement Modification Letter accepted by Purchaser.
"Third Party Underwriter": Any third party, including but not
limited to a mortgage loan pool insurer, who underwrites the
Mortgage Loan(s) prior to the purchase by Purchaser of the related
Mortgage Loan Pool.
"Third Party Underwriter's Certificate": A certificate issued by a
Third Party Underwriter with respect to a Mortgage Loan, certifying
that such Mortgage Loan complies with its underwriting
requirements.
"Trade Assignment": The assignment by Seller to Purchaser of
Seller's rights under a specific Takeout Commitment, in the form of
Exhibit D-1, or of Seller's rights under all Takeout Commitments, in
the form of Exhibit D-2.
"Trade Price": The trade price set forth on a Takeout Commitment
less any applicable Price Adjustment.
"Trade Principal": With respect to any Mortgage Loan Pool, the
aggregate outstanding principal balance of such Mortgage Loan
multiplied by a percentage equal to the Trade Price.
"Warehouse Lender": Any lender providing financing to Seller for
the purpose of originating or purchasing
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Mortgage Loans which has a security interest in such Mortgage
Loans as collateral for the obligations of Seller to such
lender.
"Warehouse Lender's Wire Instructions": The wire
instructions set forth in a letter in the form of Exhibit B-2.
Section 2. Procedures for Purchases of Mortgage Loans
(a) Purchaser may, in its sole discretion, from time to time,
purchase one or more Mortgage Loan Pools from Seller. Prior to
Purchaser's election to purchase any Mortgage Loan Pool, Purchaser shall
have received from Custodian (i) an original Trust Receipt relating to
all Mortgage Loans (including the Mortgage Loan Pool being purchased)
relating to Cash Window Transactions or Conduit Transactions, as
applicable, the original fully completed and authenticated by Custodian
and (ii) a copy of the Takeout Confirmation related to the Mortgage
Loan(s) in such Mortgage Loan Pool, together with a Trade Assignment in
the form of Exhibit D-1 or Exhibit D-2, executed by Seller and Takeout
Investor and (iii) an original letter in the form of Exhibit B-1 (an
"Exhibit B-1 Letter") from the applicable Warehouse Lender (if any), or
an original letter in the form of Exhibit C-1 (an "Exhibit C-1 Letter")
in the event that there is no Warehouse Lender. Simultaneously with the
payment by Purchaser of the Purchase Price, in accordance with the
Warehouse Lender's Wire Instructions or Seller's Wire Instructions, as
applicable, with respect to a Mortgage Loan pool, Seller hereby conveys
to Purchaser all of Seller's right, title and interest in and to the
related Mortgage Loan(s) free and clear of any lien, claim or
encumbrance. Notwithstanding the satisfaction by Seller of the
conditions specified in this Section 2(a), Purchaser is not obligated to
purchase any Mortgage Loans offered to it hereunder.
(b) If Purchaser elects to purchase any Mortgage Loan Pool,
Purchaser shall pay the amount of the Purchase Price for such Mortgage
Loan Pool by wire transfer of immediately available funds in accordance
with the Warehouse Lender's Wire Instructions or if there is no
Warehouse Lender, Seller's Wire Instructions. Upon such payment and not
otherwise, Purchaser shall be deemed to have accepted the related Trade
Assignment. In the event that Purchaser rejects a Mortgage Loan for
purchase for any reason and/or does not transmit the applicable Purchase
Price, (i) the Trust Receipt delivered by Custodian to Purchaser in
anticipation of such purchase shall automatically be null and void and
the previously existing Trust Receipt for that type of transaction shall
be in full force and effect, (ii) Purchaser shall not
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consummate the transactions contemplated in the applicable Takeout
Confirmation and shall deliver to Takeout Investor (with a copy to Seller and
Custodian) a Notice of Rejection of Trade Assignment, provided, however, that
failure of Purchaser to give such notice shall not affect the rejection by
Purchaser of the Trade Assignment, and (iii) if Purchaser shall nevertheless
receive any portion of the related Takeout Proceeds, Purchaser shall promptly
pay such Takeout Proceeds to Seller in accordance with Seller's Wire
Instructions.
(c) The terms and conditions of the purchase of each Mortgage Loan
Pool shall be as set forth in this Agreement.
Section 3. Sale of Mortgage Loans to Takeout Investor.
(a) With respect to Mortgage Loan(s) that Purchaser has elected to
purchase, Purchaser may, at its option, either (i) instruct Custodian to
deliver to Takeout Investor, in accordance with Takeout Investor's
instructions, the Custodial File in respect of such Mortgage Loans, in the
manner and at the time set forth in the Custodial Agreement, or (ii) provide
for the delivery of the Custodial File through an escrow arrangement
satisfactory to Purchaser and Takeout Investor. Seller shall on or after the
Purchase Date, but in no event later than the related Expiration Date, promptly
deliver to Takeout Investor the related Credit File and thereafter any and all
additional documents requested by Takeout Investor to enable Takeout Investor
to purchase such Mortgage Loan(s) on or before the related Cure Date.
(b) Except when Purchaser has accepted a Settlement Modification
Letter, unless the Takeout Proceeds are received by Purchaser (in immediately
available funds in accordance with Purchaser's Wire Instructions) with respect
to the Mortgage Loans in a Mortgage Pool, on or before the related Cure Date,
the Completion Fee relating to such Mortgage Pool shall not be payable until
the earlier to occur of (1) the date of receipt by Purchaser of the Takeout
Proceeds and (2) the satisfaction by Seller of its obligations pursuant to the
exercise by Purchaser of any remedial election authorized by this Section 3.
Upon receipt by Purchaser, prior to the Cure Date, of a Settlement Modification
Letter, duly executed by Takeout Investor and Seller, Purchaser may, at its
election, agree to the postponement of the Settlement Date and such other
matters as are set forth in the Settlement Modification Letter. If Purchaser
elects to accept a Settlement Modification Letter, Purchaser shall, not later
than two (2) Business Days after receipt of such Settlement Modification Letter
execute the Settlement Modification Letter
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and send, via facsimile, copies of such fully executed Settlement
Modification Letter to Seller and Takeout Investor. Upon execution by
Purchaser of a Settlement Modification Letter, Purchaser shall recalculate the
amount of the Completion Fee, if any, due to Seller using the new terms
included in the Settlement Modification Letter and shall pay to Seller, not
later than two (2) Business Days after Purchaser's receipt of such Settlement
Modification Letter, the amount of such recalculated Completion Fee.
(c)(1) If a breach by Seller of this Agreement results in any
Mortgage Loan being a Defective Mortgage Loan at the time of the
delivery of the related Trust Receipt to Purchaser and in Purchaser's sole
judgement the defects in such Mortgage Loan will not be cured (or in fact are
not cured) by Seller prior to the Cure Date, Purchaser, at its election, may
require that Seller, upon receipt of notice from Purchaser of its exercise of
such right, either (i) immediately repurchase Purchaser's ownership interest in
such Defective Mortgage Loan by remitting to Purchaser (in immediately
available funds in accordance with Purchaser's Wire Instructions) the amount
paid by Purchaser for such Defective Mortgage Loan plus interest at the
Pass-Through Rate on the principal amount thereof from the date of Purchaser's
purchase of the related Mortgage Loan Pool to the date of such repurchase or
(ii) deliver to Custodian a Mortgage Loan in exchange for such Defective
Mortgage Loan, which newly delivered Mortgage Loan shall be in all respects
acceptable to Purchaser in Purchaser's reasonable discretion. If the aggregate
principal balance of all Mortgage Loan(s) that are accepted by Purchaser
pursuant to clause (ii) of the immediately preceding sentence is less than the
aggregate principal balance of all Defective Mortgage Loan(s) that are being
replaced by such Mortgage Loan(s), Seller shall remit with such Mortgage Loan
to Purchaser an amount equal to the difference between the aggregate principal
balance of the new Mortgage Loan(s) accepted by Purchaser and the aggregate
principal balance of the Defective Mortgage Loan(s) being replaced thereby.
(c)(2) If Seller fails to comply with its obligations in the manner
described in Section 3(c)(1), not later than the third day after receipt by
Seller of notice from Purchaser, Seller's rights and obligations to service
Mortgage Loan(s) as provided in this Agreement, shall terminate. If an Act of
Insolvency occurs at any time, Seller's rights and obligations to service the
Mortgage Loan(s), as provided in this Agreement, shall terminate immediately,
without any notice or action by Purchaser. Upon any such termination,
Purchaser is hereby authorized and empowered as the exclusive agent for Seller
to
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sell and transfer such rights to service the Mortgage Loan(s) for such
price and on such terms and conditions as Purchaser shall reasonably determine,
and Seller shall not otherwise attempt to sell or transfer such rights to
service without the prior consent of Purchaser. Seller shall perform all acts
and take all action so that the Mortgage Loan(s) and all files and documents
relating to such Mortgage Loan(s) held by Seller, together with all escrow
amounts relating to such Mortgage Loan(s), are delivered to Successor Servicer.
To the extent that the approval of any Third Party Underwriter or any other
insurer or guarantor is required for any such sale or transfer, Seller shall
fully cooperate with Purchaser to obtain such approval. Upon exercise by
Purchaser of its remedies under this Section 3(c)(2), Seller hereby authorizes
Purchaser to receive all amounts paid by any purchaser of such rights to
service the Mortgage Loan(s) and to remit such amounts to Seller subject to
Purchaser's rights of set-off under this Agreement. Upon exercise by Purchaser
of its remedies under this Section 3(c)(2), Purchaser's obligation to pay and
Seller's right to receive any portion of the Completion Fee relating to such
Mortgage Loan(s) shall automatically be cancelled and become null and void,
provided that such cancellation shall in no way relieve Seller or otherwise
affect the obligation of Seller to indemnify and hold Purchaser harmless as
specified in Section 3(e).
(d) Each Mortgage Loan required to be delivered to Successor
Servicer by Section 3(c)(2) shall be delivered free of any servicing
rights in favor of Seller and free of any title, interest, lien, encumbrance or
claim of any kind of Seller. Seller shall deliver or cause to be delivered all
files and documents relating to each Mortgage Loan held by Seller to Successor
Servicer. Seller shall promptly take such actions and furnish to Purchaser
such documents that Purchaser deems necessary or appropriate to enable
Purchaser to cure any defect in each such Mortgage Loan or to enforce such
Mortgage Loans, as appropriate.
(e) Seller agrees to indemnify and hold Purchaser and its assigns
harmless from and against all Losses resulting from or relating to any
breach or failure to perform by Seller of any representation, warranty,
covenant, term or condition made or to be performed by Seller under this
Agreement.
(f) No exercise by Purchaser of its rights under this Section 3
shall relieve Seller of responsibility or liability for any breach of
this Agreement.
(g) Seller hereby grants Purchaser a right of set-off against the
payment of any amounts that may be due and payable to
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Purchaser from Seller, such right to be upon any and all monies or
other property of Seller held or received by Purchaser, or due and owing from
Purchaser to Seller.
Section 4. Completion Fee.
(a) With respect to each Mortgage Loan Pool that Purchaser elects to
purchase hereunder, Purchase shall pay to Seller a Completion Fee. The
Completion Fee shall be payable by Purchaser as provided in subsection (e)
below.
(b) For purposes of calculating that portion of the Completion Fee
composed of the "Net Carry Adjustment", the Net Carry Adjustment shall
be an amount (which may be a negative number) equal to (A) the product obtained
by multiplying the number of days in the period beginning on the Purchase Date
to but not including the Settlement Date and the difference between (i) the
product of the rate of interest to be borne by the related Mortgage Loans in
the Mortgage Pool and the aggregate principal amount of such Mortgage Loans and
(ii) the daily application of the applicable Pass-Through Rate to the Purchase
Price (B) divided by 360.
(c) If a Mortgage Loan Pool is purchased by Purchaser in the month
prior to the month in which the related Settlement Date occurs, (A) all
interest which accrues on the related Mortgage Loans, on and after the Purchase
Date, through the last day of the month prior to the month in which such
Settlement Date occurs, shall be paid to Purchaser by Seller, as servicer, on
the related Settlement Date and (B) all interest which accrues on the Mortgage
Loans in such Mortgage Loan Pool on and after the first day of the month in
which such Settlement Date occurs, through the day immediately prior to such
Settlement Date, will be paid to Purchaser by Takeout Investor on such
Settlement Date unless such Settlement Date occurs after the Cut-off Date of
such month in which event Seller, as servicer, shall pay such amount to
Purchaser on such Settlement Date. If a Mortgage Loan Pool is purchased by
Purchaser in the same month in which the related Settlement Date occurs, (A)
all interest, if any, which accrues on such Mortgage Loan(s) from the first day
of such month to but not including the related Purchase Date shall be paid by
Purchaser to Seller on such Settlement Date, and (B) all interest which accrues
on such Mortgage Loan(s), on and after the Purchase Date to but not including
the Settlement Date will be paid to Purchaser by Takeout Investor on the
Settlement Date unless such Settlement Date occurs after the Cut-off Date or in
a month in which interest has been prepaid by the Mortgagor in either of which
events Seller, as servicer, shall pay such amount to
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Purchaser on such Settlement Date. For purposes of this paragraph all
interest payments shall be deemed to accrue at the applicable rate set forth
in the related Takeout Commitment.
(d) It is understood by Seller and Purchaser that, if Seller
requests and Purchaser agrees to pay the Completion Fee prior to the
Settlement Date, the amount of such Completion Fee shall be adjusted as
mutually agreed by Seller and Purchaser.
(e) The Completion Fee relating to each Mortgage Loan Pool is
payable on the earlier to occur of (1) the date of receipt by Purchaser of the
Trade Price and (2) the satisfaction by Seller of its obligations pursuant to
this Agreement notwithstanding the exercise by Purchaser of any remedial
election authorized herein.
Section 5. Servicing of the Mortgage Loans.
(a) Seller shall service and administer the Mortgage Loan(s) on
behalf of Purchaser in accordance with prudent mortgage loan servicing
standards and procedures generally accepted in the mortgage banking industry
and in accordance with the requirements of Takeout Investor, provided that
Seller shall at all times comply with applicable law, and the requirements of
any applicable insurer or guarantor including, without limitation, any Third
Party Underwriter, so that the insurance in respect of any Mortgage Loan is not
voided or reduced. Seller shall at all times maintain accurate and complete
records of its servicing of each Mortgage Loan, and Purchaser may, at any time
during Seller's business hours on reasonable notice, examine and make copies of
such records. In addition, if a Mortgage Loan is not purchased by Takeout
Investor on or before the Cure Date, Seller shall at Purchaser's request
deliver to Purchaser monthly reports regarding the status of such Mortgage
Loan, which reports shall include, but shall not be limited to, a description
of each Mortgage Loan in default for more than thirty (30) days, and such other
circumstances with respect to any Mortgage Loan (whether or not such Mortgage
Loan is included in the foregoing list) that could materially adversely affect
any such Mortgage Loan, Purchaser's ownership of any such Mortgage Loan or the
collateral securing any such Mortgage Loan. Seller shall deliver such a report
to Purchaser every thirty (30) days until (i) the purchase by Takeout Investor
of such Mortgage Loan pursuant to the related Takeout Commitment or (ii) the
exercise by Purchaser of any remedial election pursuant to Section 3.
(b) Within five (5) business days of notice from Purchaser, Seller
shall establish and maintain a separate
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custodial account (the "Custodial Account") entitled "[Name of Seller],
in trust for Prudential Securities Realty Funding Corporation and its assignees
under the Mortgage Loan Purchase and Sale Agreement dated [the date of this
Agreement]" and shall promptly deposit into such account in the form received
with any necessary endorsements all collections received in respect of each
Mortgage Loan that are payable to Purchaser as the owner of each such Mortgage
Loan.
(c) Amounts deposited in the Custodial Account with respect to any
Mortgage Loan shall be held in trust for Purchaser as the owner of such
Mortgage Loan and shall be released only as follows:
(1) Except as otherwise provided in Section 5(c)(2), following
receipt by Purchaser or its designee of the Takeout Proceeds
for such Mortgage Loan from Takeout Investor or Seller amounts
deposited in the Custodial Account shall be released in accordance
with Section 3(a)(2). Notwithstanding the foregoing, all amounts
deposited in the Custodial Account shall be paid to Seller upon the
purchase by Takeout Investor of the related Mortgage Loan(s) from
Purchaser if, and to the extent that, the amounts due and payable to
Purchaser hereunder have been set-off against the Purchase Price for
the related Mortgage Loan Pool or the Completion Fee relating to the
Mortgage Loan(s) in such Mortgage Loan Pool. The amounts paid to
Seller (if any) pursuant to this Section 5(c)(1) shall constitute
Seller's sole compensation for servicing the Mortgage Loans as
provided in this Section 5.
(2) If Successor Servicer takes delivery of such Mortgage Loan
(either under the circumstances set forth in Section 3 or
otherwise), all amounts deposited in the Custodial. Account shall
be paid to Purchaser promptly upon such delivery.
(3) If a Mortgage Loan is not purchased by Takeout Investor on or
before the Cure Date, during the period thereafter that Seller
remains as servicer, all amounts deposited in the Custodial Account
shall be released only in accordance with a Purchaser's written
instructions.
Section 6. Trade Assignments. Seller hereby assigns to Purchaser,
free of any security interest, lien, claim or encumbrance of any kind,
Seller's rights, under each Takeout
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Commitment as to which Takeout Investor has consented to assignment, to
deliver the Mortgage Loan(s) specified therein to the related Takeout Investor
and to receive the Takeout Proceeds therefor from such Takeout Investor.
Purchaser shall not be deemed to have accepted any Trade Assignment unless and
until it purchases the related Mortgage Loans, and nothing set forth herein
shall be deemed to impair Purchaser's right to reject any Mortgage Loan for any
reason, in its sole discretion.
Section 7. Transfers of Beneficial Interest in Mortgage Loans by
Purchaser. Purchaser may, in its sole discretion, assign all of its
right, title and interest in or grant a security interest in any Mortgage Loan
sold by Seller hereunder and all rights of Purchaser under this Agreement and
the Custodial Agreement, in respect of such Mortgage Loan to a tri-party
custody and clearing agent ("Assignee"), subject only to an obligation on the
part of Assignee to deliver each such Mortgage Loan to Takeout Investor
pursuant to Section 6 or to Purchaser to permit Purchaser or its designee to
make delivery thereof to a Takeout Investor pursuant to Section 6. It is
anticipated that such assignment to an Assignee will be made by Purchaser, and
Seller hereby irrevocably consents to such assignment. No notice of such
assignment shall be given by Purchaser to Seller or Takeout Investor.
Assignment by Purchaser of the Mortgage Loans as provided in this Section 7
shall not release Purchaser from its obligations otherwise under this
Agreement.
Without limitation of the foregoing, an assignment of the Mortgage
Loans to an Assignee, as described in this Section 7, shall be
effective upon delivery to the Assignee of a duly executed and authenticated
Trust Receipt.
Section 8. Record Title to Mortgage Loans; Intent of Parties;
Security Interest.
(a) From and after the issuance and delivery of the related Trust
Receipt, and subject to the remedies of Purchaser in Section 3, Seller
shall remain the last named payee or endorsee of each Mortgage Note and the
mortgagee or assignee of record of each Mortgage in trust for the benefit of
Purchaser, for the sole purpose of facilitating the servicing of such Mortgage
Loan.
(b) Seller shall maintain a complete set of books and records for
each Mortgage Loan which shall be clearly marked to reflect the
ownership interest in each Mortgage Loan of the holder of the related Trust
Receipt.
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(c) Purchaser and Seller confirm that the transactions contemplated
herein are intended to be sales of the Mortgage Loans by Seller to Purchaser
rather than borrowings secured by the Mortgage Loans. In the event, for any
reason, any transaction is construed by any court or regulatory authority as a
borrowing rather than as a sale, Seller and Purchaser intend that Purchaser or
its Assignee, as the case may be, shall have a perfected first priority
security interest in the Mortgage Loans, the Custodial Account, and all
proceeds thereof, the Takeout Commitments and the proceeds of any and all of
the foregoing (collectively, the "Collateral"), free and clear of adverse
claims. In such case, Seller shall be deemed to have hereby granted to
Purchaser or Assignee, as the case may be, a first priority security interest
in and lien upon the Collateral, free and clear of adverse claims. In such
event, this Agreement shall constitute a security agreement, the Custodian
shall be deemed to be an independent custodian for purposes of perfection of
the security interest granted to Purchaser or Assignee, as the case may be, and
Purchaser or Assignee, as the case may be, shall have all of the rights of a
secured party under applicable law.
Section 9. Representations and Warranties.
(a) Seller hereby represents and warrants to Purchaser as of the date
hereof and as of the date of each issuance and delivery of a Trust Receipt
that:
(i) Seller is duly organized, validly existing and in good
standing under the laws of the state of its organization and has all
licenses necessary to carry on its business as now being conducted and
is licensed, qualified and in good standing in the state where the
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. Seller has all requisite power and authority
(including, if applicable, corporate power) to execute and deliver this
Agreement and to perform in accordance herewith; the execution,
delivery and performance of this Agreement (including all instruments
of transfer to be delivered pursuant to this Agreement) by Seller and
the consummation of the transactions contemplated hereby have been duly
and validly authorized; this Agreement evidences the valid, binding and
enforceable obligation of Seller; and all requisite action (including,
if applicable, corporate action) has been taken by Seller to make this
Agreement valid and binding upon Seller in accordance with its terms;
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(ii) No approval of the transactions contemplated by this
Agreement from the OTS, the NCUA, the FDIC or any similar federal or
state regulatory authority having jurisdiction over Seller is required,
or if required, such approval has been obtained. There are no actions
or proceedings pending or affecting Seller which would adversely affect
its ability to perform hereunder. The transfers, assignments and
conveyances provided for herein are not subject to the bulk transfer or
any similar statutory provisions in effect in any applicable
jurisdiction;
(iii) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of Seller and will not
result in the breach of any term or provision of the charter or by-laws
of Seller or result in the breach of any term or provision of, or
conflict with or constitute a default under or result in the
acceleration of any obligation under, any agreement, indenture or loan
or credit agreement or other instrument to which Seller or its property
is subject, or result in the violation of any law, rule, regulation,
order, judgment or decree to which Seller or its property is subject;
(iv) This Agreement, the Custodial Agreement and every document
to be executed by Seller pursuant to this Agreement is and will be
valid, binding and subsisting obligations of Seller, enforceable in
accordance with their respective terms. No consents or approvals are
required to be obtained by Seller or its Parent Company for the
execution, delivery and performance of this Agreement or the Custodial
Agreement by Seller;
(v) Seller has not sold, assigned, transferred, pledged or
hypothecated any interest in any Mortgage Loan sold hereunder to any
person other than Purchaser, and upon delivery of a related Trust
Receipt to Purchaser, Purchaser will be the sole owner thereof, free
and clear of any lien, claim or encumbrance; and
(vi) All information relating to Seller that Seller has
delivered or caused to be delivered to Purchaser, including, but not
limited to, all documents related to this Agreement, the Custodial
Agreement or Seller's financial statements, does not contain any untrue
statement of a material fact or omit to state a
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material fact necessary to make the statements made therein or
herein in light of the circumstances under which they were made, not
misleading.
(b) Seller hereby represents, warrants and covenants to Purchaser with
respect to each Mortgage Loan as of the Purchase Date of such Mortgage Loan
that:
(i) The Mortgage Loan conforms in all respects to the
requirements of this Agreement, the Sale Agreement, the Commitment
Guidelines and the requirements of the related Third Party
Underwriter's Certificate;
(ii) Seller is the sole owner and holder of the Mortgage Loan
free and clear of any and all liens, pledges, charges or security
interests of any nature and has full right and authority, subject to no
interest or participation of, or agreement with, any other party, to
sell and assign the same pursuant to this Agreement;
(iii) No servicing agreement has been entered into with respect
to the Mortgage Loan, or any such servicing agreement has been
terminated and there are no restrictions, contractual or governmental,
which would impair the ability of Purchaser or Purchaser's designees
from servicing the Mortgage Loan;
(iv) The Mortgage is a valid and subsisting first lien on the
property therein described and the Mortgaged Property is free and clear
of all encumbrances and liens having priority over the first lien of
the Mortgage except for liens for real estate taxes and special
assessments not yet due and payable. Any pledge account, security
agreement, chattel mortgage or equivalent document related to, and
delivered to Purchaser with the Mortgage, establishes in Seller a valid
and subsisting first lien on the property described therein, and Seller
has full right to sell and assign the same to Purchaser;
(v) Neither Seller nor any prior holder of the Mortgage has
modified the Mortgage in any material respect; satisfied, canceled or
subordinated the Mortgage in whole or in part; released the Mortgaged
Property in whole or in part from the lien of the Mortgage; or executed
any instrument of release, cancellation, modification or satisfaction
unless such
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release, cancellation, modification or satisfaction does not
adversely affect the value of the Mortgage Loan and is contained in the
related Document File;
(vi) The Mortgage Loan is not in default, and all Monthly
Payments due prior to the Purchase Date and all taxes, governmental
assessments, insurance premiums, water, sewer and municipal charges,
leasehold payments or ground rents have been paid. Seller has not
advanced funds, or induced or solicited any advance of funds by a party
other than the Mortgagor directly or indirectly, for the payment of any
amount required by the Mortgage Loan. The collection practices used by
each entity which has serviced the Mortgage Loan have been in all
respects legal, proper, prudent, and customary in the mortgage
servicing business. With respect to escrow deposits and payments in
those instances where such were required, there exist no deficiencies
in connection therewith for which customary arrangements for repayment
thereof have not been made and no escrow deposits or payments or other
charges or payments have been capitalized under any Mortgage or the
related Mortgage Note;
(vii) There is no default, breach, violation or event of
acceleration existing under the Mortgage or the related Mortgage Note
and no event which, with the passage of time or with notice and the
expiration of any grace of cure period, would constitute a default,
breach, violation or event of acceleration; and Seller has not waived
any default, breach, violation or event of acceleration;
(viii) The Mortgage Loan is not 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
or the Mortgage, or the exercise of any right thereunder, render either
the Mortgage Note or 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 no such right of
rescission, set-off, counterclaim or defense has been asserted with
respect thereto;
(ix) The Mortgage Note and the related Mortgage are genuine and
each is the legal, valid and binding obligation of the maker thereof,
enforceable in
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accordance with its terms. All parties to the Mortgage Note
and the Mortgage had legal capacity to execute the Mortgage Note and
the Mortgage and each Mortgage Note and Mortgage have been duly and
properly executed by the Mortgagor;
(x) The Mortgage Loan meets, or is exempt from, applicable
state or federal laws, regulations and other requirements pertaining to
usury, and the Mortgage Loan is not usurious;
(xi) Any and all requirements of any federal, state or local
law including, without limitation, truth-in-lending, real estate
settlement procedures, consumer credit protection, equal credit
opportunity or disclosure laws applicable to the Mortgage Loan have
been complied with, and Seller shall deliver to Purchaser upon demand,
evidence of compliance with all such requirements;
(xii) Either: (i) Seller and every other holder of the
Mortgage, if any, were authorized to transact and do business in the
jurisdiction in which the Mortgaged Property is located at all times
when such party held the Mortgage; or (ii) the loan of mortgage funds,
the acquisition of the Mortgage (if Seller was not the original
lender), the holding of the Mortgage and the transfer of the Mortgage
did not constitute the transaction of business or the doing of business
in such jurisdiction;
(xiii) The proceeds of the Mortgage Loan have been fully
disbursed, there is no requirement for future advances thereunder and
any and all requirements as to completion of any on site or off-site
improvements and as to disbursements of any escrow funds, therefore,
have been complied with. All costs, fees and expenses incurred in
making, closing or recording the Mortgage Loans were paid;
(xiv) The related Mortgage contains customary and enforceable
provisions such as to render the rights and remedies of the holder
thereof adequate for the realization against the Mortgaged Property of
the benefits of the security, including, (i) in the case of a Mortgage
designated as a deed of trust, by trustee's sale, and (ii) otherwise by
judicial foreclosure. There is no homestead or other exemption
available to
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the Mortgagor which would interfere with the right to sell the
Mortgaged Property at a trustee's sale or the right to foreclose the
Mortgage;
(xv) The Mortgage Loan was originated free of any "original
issue discount" with respect to which the owner of the Mortgage Loan
could be deemed to have income pursuant to Sections 1271 et seq. of
the Internal Revenue Code;
(xvi) Each Mortgage Loan was originated by an institution
described in Section 3(a)(41)(A)(ii) of the Securities Exchange Act of
1934, as amended;
(xvii) At origination, the Mortgaged Property was free and
clear of all mechanics, and materialmen's liens or liens in the nature
thereof which are or could be prior to the Mortgage lien, and no rights
are outstanding that under law could give rise to any such lien;
(xviii) All of the improvements which are included for the
purpose of determining the appraised value of the Mortgaged Property
lie wholly within the boundaries and building restriction lines of such
property, and no improvements on adjoining properties encroach upon the
Mortgaged Property;
(xix) At origination, no improvement located on or being part
of the Mortgaged Property was in violation of any applicable zoning law
or regulation and all inspections, licenses and certificates required
to be made or issued with respect to all occupied portions of the
Mortgaged Property, and with respect to the use and occupancy of the
same, including but not limited to certificates of occupancy and fire
underwriting certificates, had been made or obtained from the
appropriate authorities and the Mortgaged Property was lawfully
occupied under applicable law. No improvement located on or being part
of the Mortgaged Property is in violation of any applicable zoning law
or regulation and all inspections, licenses and certificates required
to be made or issued with respect to the Mortgaged Property, and with
respect to the use and occupancy of the same, including but not limited
to certificates of occupancy and fire underwriting certificates, have
been made or obtained from the appropriate authorities and
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the Mortgaged Property is lawfully occupied under applicable
law;
(xx) There is no proceeding pending for the total or partial
condemnation of the Mortgaged Property and said property is undamaged
by waste, fire, earthquake or earth movement, windstorm, flood, tornado
or other casualty;
(xxi) The Custodial File contains and the Credit File contains
or shall contain prior to the Cure Date each of the documents and
instruments specified to be included therein duly executed and in due
and proper form and each such document or instrument is either in form
acceptable to FNMA or is a FNMA/FHLMC uniform instrument. Each
Mortgage Note and Mortgage are on forms approved by FNMA with such
riders as have been approved by FNMA; Seller is currently in possession
of the Custodial File for each Mortgage Loan and is in possession or
shall be prior to the Expiration Date of the Credit File for each
Mortgage Loan and there are no custodial agreements in effect adversely
affecting the rights of Seller to make the deliveries required within
the required time. Seller shall not deliver a Credit File to Takeout
Investor prior to the related Commitment Date;
(xxii) Each Mortgage Loan is covered by a mortgage title
insurance policy acceptable to FNMA, issued by, and the valid and
binding obligation of, a title insurer acceptable to FNMA and qualified
to do business in the jurisdiction where the Mortgaged Property is
located, insuring Seller, its successors and assigns, as to the first
priority lien of the Mortgage in the original principal amount of the
Mortgage Loan, Seller is the named insured and the sole insured of such
mortgage title insurance policy, the assignment to Purchaser of
Seller's interest in such mortgage title insurance policy does not
require the consent of or notification to the insurer, such mortgage
title insurance policy is in full force and effect and will be in full
force and effect and inure to the benefit of Purchaser upon the
consummation of the transactions contemplated by this Agreement and no
claims have been made under such mortgage title insurance policy and no
prior holder of the related Mortgage, including Seller, has done, by
act or omission, anything which would
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impair the coverage of such mortgage title insurance policy;
(xxiii) All buildings upon the Mortgaged Property are insured
against loss by fire, hazards of extended coverage and such other
hazards as are customary in the area where the Mortgaged Property is
located, pursuant to fire and hazard insurance policies with extended
coverage or other insurance required by the Sale Agreement, in an
amount at least equal to the lesser of (i) the outstanding principal
balance of the Mortgage Loan or (ii) the maximum insurable value
(replacement cost without deduction for depreciation) of the
improvements constituting the Mortgaged Property. If applicable laws
limit the amount of such insurance to the replacement cost of the
improvements constituting the Mortgaged Property or to some other
amount, then such insurance is in an amount equal to the maximum
allowed by such laws. Such insurance amount is sufficient to prevent
the Mortgagor or the loss payee under the policy from becoming a
co-insurer. The insurer issuing such insurance is acceptable pursuant
to the Sale Agreement. All individual insurance policies contain a
standard mortgagee clause naming Seller, its successors and assigns, as
mortgagee and all premiums thereon have been paid. Each Mortgage
obligates the Mortgagor thereunder to maintain all such insurance at
Mortgagor's cost and expense, and upon the Mortgagor's failure to do
so, authorizes the holder of the Mortgage to obtain and maintain such
insurance at Mortgagor's cost and expense and to seek reimbursement
therefor from the Mortgagor. Any flood insurance required by
applicable law has been obtained;
(xxiv) The original principal amount of the related Mortgage
Note either (a) was not more than 80% of the lesser of (i) the purchase
price of the Mortgaged Property paid by the Mortgagor at the
origination of the Mortgage Loan and (ii) the appraised value of the
Mortgaged Property, such appraised value being, for the purposes
hereof, the amount set forth in an appraisal made in connection with
the origination of such Mortgage Loan, or (b) is and will be insured as
to payment defaults by a policy of primary mortgage guaranty insurance
in accordance with the Sale Agreement and all provisions of such
primary mortgage guaranty insurance policy have been and are being
complied with, such policy is in full force and effect,
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and all premiums due thereunder have been paid. Any Mortgage
Loan subject to any such policy of primary mortgage guaranty insurance
obligates the Mortgagor thereunder to maintain such insurance and pay
all premiums and charges in connection therewith. The original
principal amount of each Mortgage Note was not more than 95% of the
purchase price of the related Mortgaged Property paid by the Mortgagor
at the origination of the Mortgage Loan. No action, event or state of
facts exists or has existed which, because involving or arising from
any dishonest, fraudulent, criminal, negligent or knowingly wrongful
act, error or omission by the Mortgagor or the originator or servicer
of the Mortgage Loan, would result in the exclusion from, denial of, or
defense to coverage which otherwise would be provided by such
insurance;
(xxv) At the time that the related Mortgage Loan was made the
Mortgagor represented that the Mortgagor would occupy such Mortgaged
Property as Mortgagor's primary residence;
(xxvi) The Mortgaged Property consists of a single parcel of
real property; and
(xxvii) There are no circumstances or conditions with respect
to the Mortgage, the Mortgaged Property, the Mortgagor or the
Mortgagor's credit standing that can be reasonably expected to cause
private institutional investors to regard the Mortgage Loan as an
unacceptable investment, cause the Mortgage Loan to become delinquent
or adversely affect the value or marketability of the Mortgage Loan.
The representations and warranties of Seller in this Section 9 are
unaffected by and supersede any provision in any endorsement of any Mortgage
Loan or in any assignment with respect to such Mortgage Loan to the effect that
such endorsement or assignment is without recourse or without representation or
warranty.
Section 10. Covenants of Seller. Seller hereby covenants and
agrees with Purchaser as follows:
(a) Seller shall deliver to Purchaser:
(i) Within one hundred twenty (120) days after the end of each
fiscal year of Seller, consolidated balance sheets of Seller and its
consolidated subsidiaries and
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the related consolidated statements of income showing the
financial condition of Seller and its consolidated subsidiaries as of
the close of such fiscal year and the results of operations during such
year, and a consolidated statement of cash flows, as of the close of
such fiscal year, setting forth, in each case, in comparative form the
corresponding figures for the preceding year, all the foregoing
consolidated financial statements to be reported on by, and to carry
the report (acceptable in form and content to Purchaser) of an
independent public accountant of national standing acceptable to
Purchaser;
(ii) Within sixty (60) days after the end of each of the first
three fiscal quarters of each fiscal year of Seller, unaudited
consolidated balance sheets and consolidated statements of income, all
to be in a form acceptable to Purchaser, showing the financial
condition and results of operations of Seller and its consolidated
subsidiaries on a consolidated basis as of the end of each such quarter
and for the then elapsed portion of the fiscal year, setting forth, in
each case, in comparative form the corresponding figures for the
corresponding periods of the preceding fiscal year, certified by a
financial officer of Seller (acceptable to Purchaser) as presenting
fairly the financial position and results of operations of Seller and
its consolidated subsidiaries and as having been prepared in accordance
with generally accepted accounting principles consistently applied, in
each case, subject to normal year-end audit adjustments;
(iii) Promptly upon receipt thereof, a copy of each other
report submitted to Seller by its independent public accountants in
connection with any annual, interim or special audit of Seller;
(iv) Promptly upon becoming aware thereof, notice of (1) the
commencement of, or any determination in, any legal, judicial or
regulatory proceedings, (2) any dispute between Seller or its Parent
Company and any governmental or regulatory body, (3) any event or
condition, which, in any case of (1) or (2) if adversely determined,
would have a material adverse effect on (A) the validity or
enforceability of this Agreement, (B) the financial condition or
business operations of Seller, or (C) the ability of Seller to fulfill
its obligations under this Agreement or (4) any
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material adverse change in the business, operations, prospects
or financial condition of Seller, including, without limitation, the
insolvency of Seller or its Parent Company;
(v) Promptly upon becoming available, copies of all financial
statements, reports, notices and proxy statements sent by its Parent
Company, Seller or any of Seller's consolidated subsidiaries in a
general mailing to their respective stockholders and of all reports and
other material (including copies of all registration statements under
the Securities Act of 1933, as amended) filed by any of them with any
securities exchange or with the Securities and Exchange Commission or
any governmental authority succeeding to any or all of the functions of
said Commission;
(vi) Promptly upon becoming available, copies of any press
releases issued by its Parent Company or Seller and copies of any
annual and quarterly financial reports and any reports on Form H-(b)12
which its Parent Company or Seller may be required to file with the OTS
or the RTC or comparable reports which a Parent Company or Seller may
be required to file with the FDIC or any other federal banking agency
containing such financial statements and other information concerning
such Parent Company's or Seller's business and affairs as is required
to be included in such reports in accordance with the rules and
regulations of the OTS, the RTC, the FDIC or such other banking agency,
as may be promulgated from time to time;
(vii) Such supplements to the aforementioned documents and such
other information regarding the operations, business, affairs and
financial condition of its Parent Company, Seller or any of Seller's
consolidated subsidiaries as Purchaser may request;
(viii) A copy of (1) the articles of incorporation of Seller
and any amendments thereto, certified by the Secretary of State of
Seller's state of incorporation, (2) a copy of Seller's by-laws,
together with any amendments thereto, (3) a copy of the resolutions
adopted by Seller's Board of Directors authorizing Seller to enter into
this Agreement and the Custodial Agreement and authorizing one or more
of Seller's officers to execute the documents related to this Agreement
and the Custodial Agreement, and (4) a
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certificate of incumbency and signature of each officer of
Seller executing any document in connection with this Agreement;
(ix) Neither Seller nor any affiliate thereof will acquire at
any time any economic interest in or obligation with respect to any
Mortgage Loan;
(x) Under generally accepted accounting principles ("GAAP") and
for federal income tax purposes, Seller will report each sale of a
Mortgage Loan to the Purchaser hereunder as a sale of the ownership
interest in the Mortgage Loan. Seller has been advised by or has
confirmed with its independent public accountants that the foregoing
transactions will be so classified under GAAP;
(xi) The consideration received by Seller upon the sale of each
Mortgage Loan Pool will constitute reasonably equivalent value and fair
consideration for the ownership interest in the Mortgage Loans included
therein;
(xii) Seller will be solvent at all relevant times prior to,
and will not be rendered insolvent by, any sale of a Mortgage Loan to
the Purchaser; and
(xiii) Seller will not sell any Mortgage Loan to the Purchaser
with any intent to hinder, delay or defraud any of Seller's creditors.
(b) Seller shall comply, in all material respects, with all laws, rules
and regulations to which it is or may become subject.
(c) Seller shall, upon request of Purchaser, promptly execute and
deliver to Purchaser all such other and further documents and instruments of
transfer, conveyance and assignment, and shall take such other action as
Purchaser may require more effectively to transfer, convey, assign to and vest
in Purchaser and to put Purchaser in possession of the property to be
transferred, conveyed, assigned and delivered hereunder and otherwise to carry
out more effectively the intent of the provisions under this Agreement.
Section 11. Term. This Agreement shall continue in effect until
terminated as to future transactions by written instruction signed by either
Seller or Purchaser and delivered to
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the other, provided that no termination will affect the obligations hereunder
as to any of the Mortgage Loans purchased hereunder.
Section 12. Exclusive Benefit of Parties; Assignment. This
Agreement is for the exclusive benefit of the parties hereto and their
respective successors and assigns and shall not be deemed to give any legal or
equitable right to any other person, including the Custodian. Except as
provided in Section 7, no rights or obligations created by this Agreement may
be assigned by any party hereto without the prior written consent of the other
parties.
Section 13. Amendments; Waivers; Cumulative Rights. This Agreement
may be amended from time to time only by written agreement of Seller and
Purchaser. Any forbearance, failure or delay by either party in exercising
any right, power or remedy hereunder shall not be deemed to be a waiver
thereof, and any single or partial exercise by Purchaser of any right, power
or remedy hereunder shall not preclude the further exercise thereof. Every
right, power and remedy of Purchaser shall continue in full force and effect
until specifically waived by Purchaser in writing. No right, power or remedy
shall be exclusive, and each such right, power or remedy shall be cumulative
and in addition to any other right, power or remedy, whether conferred hereby
or hereafter available at law or in equity or by statute or otherwise.
Section 14. Execution in Counterparts. This Agreement may be
executed in any number of counterparts, each of which shall be deemed an
original, but all of which shall constitute one and the same instrument.
Section 15. Effect of Invalidity of Provisions. In case any one or
more of the provisions contained in this Agreement should be or become
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein or therein shall
in no way be affected, prejudiced or disturbed thereby.
Section 16. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to conflict of laws rules.
Section 17. Notices. Any notices, consents, elections, directions
and other communications given under this Agreement shall be in writing and
shall be deemed to have been duly given when telecopied or delivered by
overnight courier,
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32
personally delivered, or on the third day following the placing thereof in
the mail, first class postage prepaid, to the respective addresses set forth
on the cover page hereof for Seller and Purchaser, or to such other address
as either party shall give notice to the other party pursuant to this Section
17. Notices to any Assignee shall be given to such address as Assignee shall
provide to Seller in writing.
Section 18. Entire Agreement. This Agreement and the Custodial
Agreement contain the entire agreement between the parties hereto with respect
to the subject matter hereof, and supersede all prior and contemporaneous
agreements between them, oral or written, of any nature whatsoever with
respect to the subject matter hereof.
Section 19. Costs of Enforcement. In addition to any other
indemnity specified in this Agreement, in the event of a breach by Seller of
this Agreement, the Custodial Agreement or a Takeout Commitment, Seller agrees
to pay the reasonable attorneys' fees and expenses of Purchaser and/or
Assignee incurred as a consequence of such breach.
Section 20. Consent to Service. Each party irrevocably consents
to the service of process by registered or certified mail, postage prepaid, to
it at its address given in or pursuant to Section 17.
Section 21. Submission to Jurisdiction. With respect to any
claim arising out of this Agreement each party (a) irrevocably submits to the
nonexclusive jurisdiction of the courts of the State of New York and the
United States District Court located in the Borough of Manhattan in New York
City, and (b) irrevocably waives (i) any objection which it may have at any
time to the laying of venue of any suit, action or proceeding arising out of
or relating hereto brought in any such court, (ii) any claim that any such
suit, action or proceeding brought in any such court has been brought in any
inconvenient forum and (iii) the right to object, with respect to such claim,
suit, action or proceeding brought in any such court, that such court does not
have jurisdiction over such party.
Section 22. Jurisdiction Not Exclusive. Nothing herein will be
deemed to preclude either party hereto from bringing an action or proceeding
in respect of this Agreement in any jurisdiction other than as set forth in
Section 21.
Section 23. Construction. The headings in this Agreement are for
convenience only and are not intended to
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33
influence its construction. References to Sections, Exhibits and Annexes in
this Agreement are to the Sections of and Exhibits to this Agreement. The
Exhibits are part of this Agreement, and are incorporated herein by reference.
The singular includes the plural, the plural the singular, and the words "and"
and "or" are used in the conjunctive or disjunctive as the sense and
circumstances may require.
IN WITNESS WHEREOF, Purchaser and Seller have duly executed this
Agreement as of the date and year set forth on the cover page hereof.
PRUDENTIAL SECURITIES REALTY FUNDING CORPORATION
By /s/ Xxxxxxx Xxxxxxx
----------------------------------------------
Name: Xxxxxxx Xxxxxxx
-------------------------------------------
Title: FDP
------------------------------------------
[MCA ]
------------------
By /s/Xxxx X. X'Xxxxx
----------------------------------------------
Name: Xxxx X. X'Xxxxx
Title: S.U.P.
Address (if different from cover page):
-30-
34
EXHIBIT A
THIS TRUST RECEIPT HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF
THIS TRUST RECEIPT OR ANY INTEREST HEREIN WITHOUT REGISTRATION
HEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPT
FROM THE REGISTRATION REQUIREMENTS OF THE ACT.
TRUST RECEIPT
RESIDENTIAL MORTGAGE LOANS
No. Date:
---------------- ----------------------
[ ], as custodian (the "Custodian"), certifies that
PRUDENTIAL SECURITIES REALTY FUNDING CORPORATION ("Purchaser") is the
registered owner of this Trust Receipt evidencing ownership of certain
mortgage loans (the "Mortgage Loans") listed by identifying number on the
schedule attached to this Trust Receipt and further identified in the books
and records of the Custodian, owned of record and serviced by [
] (the "Seller"). The Mortgage Note and Mortgage for each
Mortgage Loan are held by Custodian, pursuant to the terms and conditions
of that certain Custodial Agreement dated as of , 1994 (the
"Agreement") among Purchaser, Seller and Custodian. To the extent not
defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Trust Receipt is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the holder of this Trust Receipt by virtue of the acceptance
hereof assents and by which such holder is bound.
This Trust Receipt supersedes any Trust Receipt applying to the same
transaction type (i.e., Cash Window Transaction or Conduit Transaction)
bearing an earlier date.
This Trust Receipt shall not be valid or become obligatory for any
purpose unless and until the Certificate of Authentication appearing below
has been duly executed by the Custodian.
35
IN WITNESS WHEREOF, the Custodian has caused this Trust Receipt to be duly
executed under its official seal.
[ ]
------------------- ,
as Custodian
By:
------------------------
Authorized Officer
(Seal)
Attest:
By:
--------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This Trust Receipt is one of
the Trust Receipts issued under
the above-described Agreement.
Dated:
----------------------
By:
-------------------------
Authorized Officer
36
TRUST RECEIPT NO.
RESIDENTIAL MORTGAGE LOANS
Following are the identifying numbers of the Mortgage Loans subject to this
Trust Receipt:
37
EXHIBIT B-1
[WAREHOUSE LENDER'S RELEASE]
Prudential Securities Realty Funding Corporation
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
We hereby release all right, interest or claim of any kind, including
any security interest or lien, with respect to the mortgage loan(s) referenced
below, such release to be effective automatically without any further action by
any party, upon receipt, in one or more installments, from Prudential
Securities Realty Funding Corporation, in accordance with the wire instructions
which we delivered to you in a letter dated ____, 199_, in immediately
available funds, of an aggregate amount equal to the product of A multiplied by
B (such product being rounded to the nearest $0.01) multiplied by C.*
Street
Loan Mortgagor Address City State Zip
----------------------------------------------------------------
Very truly yours,
[WAREHOUSE LENDER]
By:
--------------------
Name:
------------------
Title:
-----------------
*A = weighted average trade price
B = principal amount of the mortgage loan(s)
C = 1 minus the discount set forth on the related
participation certificate
38
EXHIBIT B-2
[WAREHOUSE LENDER'S WIRE INSTRUCTIONS]
Prudential Securities Realty
Funding Corporation
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Prudential Securities Realty Funding Corporation Mortgage
Loan Purchase Program with [Sellerl
Ladies and Gentlemen:
Set forth below are [Warehouse Lender's] wire instructions
applicable to the above-referenced Non-Conforming Purchase Program.
Wire Instructions:
Bank Name:
City, State:
ADA #:
Account:
Account Name:
39
Please acknowledge receipt of this letter in the space provided
below. This letter supersedes and replaces any prior notice specifying the
name of [Warehouse Lender] and setting forth wire instructions and shall
remain in effect until superseded and replaced by a letter, in the form of
this letter, executed by each of us and acknowledged by you.
Very truly yours,
[SELLER]
By:
-------------------
Name:
-----------------
Title:
----------------
[WAREHOUSE LENDER(S)]*
By:
-------------------
Name:
-----------------
Title:
----------------
PRUDENTIAL SECURITIES REALTY FUNDING CORPORATION
By:
----------------------
Name:
--------------------
Title:
-------------------
--------------------------
* The authorized officer of each warehouse lender executing this letter must
be the same authorized officer as signs the Exhibit B-1 Letter. Not
applicable if there is no warehouse lender.
40
EXHIBIT C-1
[SELLER'S RELEASE]
Prudential Securities Realty Funding Corporation
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
With respect to the mortgage loan(s) referenced below (a) we hereby
certify to you that the mortgage loan(s) is not subject to a lien of any
warehouse lender and (b) we hereby release all right, interest or claim of any
kind with respect to such mortgage loan, such release to be effective
automatically without any further action by any party upon payment from
Purchaser to Seller of an aggregate amount equal to the product of A multiplied
by B (such product being rounded to the newest $0.01) multiplied by C* in
accordance with our wire instructions in effect on the date of such payment.
Street
Loan Mortgagor Address City State Zip
---------------------------------------------------------------
Very truly yours,
[SELLER]
By:
-------------------
Name:
-----------------
Title:
----------------
**Confirmed by:
[WAREHOUSE LENDER]
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
*A = weighted average trade price
B = principal amount of the mortgage loan(s)
C = 1 minus the discount set forth on the related
participation certificate
----------------
** If applicable.
41
EXHIBIT C-2
[SELLER'S WIRE INSTRUCTIONS]
Prudential Securities Realty
Funding Corporation
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Custodial Agreement dated as of _____________, 1992,
among Prudential Securities Realty Funding Corporation.
[Seller] and Custodian
Ladies and Gentlemen:
Capitalized terms used herein and not defined herein shall have the
meanings ascribed to such terms in the above-referenced Custodial Agreement.
Set forth below are Seller's Wire Instructions applicable to the
above-referenced Custodial Agreement.
Wire Instructions:
Bank Name:
City, State:
ABA #:
Account:
Account Name:
Please acknowledge receipt of this letter in the space provided
below. This letter supersedes and replaces any prior notice specifying the
name of Seller and Seller's Wire Instructions and shall remain in effect until
superseded and
42
replaced by a letter, in the form of this letter, executed by each of us and
acknowledged by you.
Very truly yours,
[SELLER]*
By:
-----------------------
Name:
---------------------
Title:
--------------------
Receipt acknowledged by:
PRUDENTIAL SECURITIES REALTY
FUNDING CORPORATION
By:
---------------------------
Name:
Title:
-------------------------------
* The authorized officer executing this letter must be the same authorized
officer as signs the Exhibit C-1 Letter. Applicable only if there is no
Warehouse Lender.
43
EXHIBIT D-1
[TRADE ASSIGNMENT]
_______________("Takeout Investor")
[Address]
Attention:______________________
Ladies and Gentlemen:
Attached hereto is a correct and complete copy of your
confirmation of commitment (the "Commitment"), trade-dated _____________, 19_,
to purchase $______ of mortgage loans (the "Mortgage Loans") at a purchase price
of ___________. This is to confirm that (i) the Commitment is in full force and
effect, (ii) the Commitment is hereby assigned to Prudential Securities Realty
Funding Corporation ("PSRFC"), (iii) you will accept delivery of such Mortgage
Loans directly from PSRFC, (iv) you will pay PSRFC for such Mortgage Loans, (v)
upon PSRFC's acceptance of this assignment, PSRFC is obligated to make delivery
of such Mortgage Loans to you in accordance with the attached Commitment and
(vi) upon PSRFC's acceptance of this assignment, you will release Seller from
its obligation to deliver the Mortgage Loans to you under the Commitment. Upon
PSRFC's determination not to accept an assignment, PSRFC will notify you that
this assignment is rejected. Not later than 2:00 P.M. Eastern Standard Time one
business day prior to your satisfaction of the Commitment, you shall fax a
purchase confirmation to PSRFC at (000) 000-0000, Attention:_________________.
Payment will be made to PSRFC in immediately available funds.
Very truly yours,
[SELLER]
By:
--------------------
Name:
------------------
Title:
-----------------
Agreed to, confirmed and accepted:
[TAKEOUT INVESTOR]
By:
---------------------
Name:
-------------------
Title:
------------------
44
EXHIBIT D-2
___________________("Takeout Investor")
[Address]
Attention:_____________________________
Ladies and Gentlemen:
This is to confirm that (i) your commitments ("Commitment"), made
from time to time, to purchase mortgage loans (the "Mortgage Loans") from
Seller may be assigned to Prudential Securities Realty Funding Corporation
("PSRFC"), (ii) you will accept delivery of such Mortgage Loans directly from
PSRFC, (iii) you will pay PSRFC for such Mortgage Loans, (iv) upon PSRFC's
acceptance of this assignment with respect to any Commitment, PSRFC will be
obligated to make delivery of such Mortgage Loans to you in accordance with
such Commitment and (v) upon PSRFC's acceptance of such assignment with respect
to any Commitment, you will release Seller from its obligation to deliver the
related Mortgage Loans to you under such Commitment but Seller will not be
released from any of its other obligation under the Loan Purchase and Sale
Agreement. Your agreement to the foregoing shall remain in effect until
terminated by your giving notice of such termination to Seller in the form
attached hereto as Exhibit 1. Upon PSRFC's determination not to accept a
assignment, PSRFC will notify you that this assignment is rejected with respect
to the related Commitment. Not later than 9:00 A.M. Eastern Standard Time on
the business day that you purchase the Mortgage, you shall fax a purchase list
containing the information required by the Mortgage Loan Settlement Summary to
PSRFC at (000) 000-0000, Attention: ___________________. You may also transmit
such information electronically by 10:00 A.M. on such business day. Payment
will be made to PSRFC in immediately available funds.
Very truly yours,
[SELLER]
By:
---------------------
Name:
-------------------
Title:
------------------
45
Agreed to, confirmed and accepted:
[TAKEOUT INVESTOR]
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
46
EXHIBIT 1 to EXHIBIT D-2
[WITHDRAWAL OF CONSENT TO BLANKET TRADE ASSIGNMENT]
[Seller]
[Address]
Ladies and Gentlemen:
The undersigned hereby terminates its agreement to Seller's assignment of
Commitments to PSRFC, which approval was given pursuant to the Trade Assignment
dated _________________. This termination shall be effective as of ____________
but shall not affect the assignment of any Commitment which assignment was
made prior to the date hereof. Capitalized terms not defined herein shall
have the meanings set forth in the Trade Assignment.
Very truly yours,
[TAKEOUT INVESTOR]
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
Copy to: [Purchaser]
47
EXHIBIT E
[PURCHASER'S WIRE INSTRUCTIONS]
[Takeout Investor]
[Address]
Re: Custodial Agreement dated as of ____________, 1992,
among Prudential Securities Realty Funding Corporation,
[Seller] and [Custodian]
Ladies and Gentlemen:
Capitalized terms used herein and not defined herein
shall have the meanings ascribed to such terms in the above-referenced
Custodial Agreement.
Set forth below are the Purchaser's Wire Instructions applicable to
the above-referenced Custodial Agreement.
Wire Instructions:
Bank Name:
City, State:
ABA #:
Account #:
Account Name:
Please acknowledge receipt of this letter in the space provided
below. This letter supersedes and replaces any prior notice specifying the
name of Purchaser and the Purchaser's Wire Instructions and shall remain in
effect until superseded and replaced by a letter, in the form of this letter,
executed by each of us and acknowledged by you.
Very truly yours,
PRUDENTIAL SECURITIES REALTY
FUNDING CORPORATION
By:
--------------------------
Name:
Title:
48
Receipt acknowledged by:
[TAKEOUT INVESTOR]
By:
-----------------------
Name:
---------------------
Title:
--------------------
cc: [Seller]
[Custodian]
49
EXHIBIT F
FORM OF CONFIRMATION
TO: [NAME AND ADDRESS OF SELLER]
DATE:
RE: Confirmation of Purchase of Mortgage Loans
Prudential Securities Realty Funding Corporation ("Purchaser") is pleased
to confirm its agreement to purchase and your agreement to sell the Mortgage
Loans relating to the pool number referred to herein, pursuant to the Mortgage
Loan Purchase and Sale Agreement, dated as of _________ __, 199_ (the "Mortgage
Loan Purchase and Sale Agreement"), between Purchaser and Seller,
under the following terms and conditions:
Pool No.
-----------------------------------------------
Check as appropriate:
Cash Window Transaction
-----
Conduit Transaction (Conduit: ) Purchase
-----
Date --------
---------------------------------------------------
Settlement Date
----------------------------------------
Discount
-----------------------------------------------
Purchase Price
-----------------------------------------
Pass-Through Rate
--------------------------------------
Total Principal Amount of the Pool
---------------------
Capitalized terms used and not otherwise defined herein shall have the
meanings ascribed in the Mortgage Loan Purchase and Sale Agreement.
Very truly yours,
PRUDENTIAL SECURITIES REALTY
FUNDING CORPORATION
By:
--------------------------
Name:
------------------------
Title:
-----------------------
50
EXHIBIT G
[NOTICE OF REJECTION OF TRADE ASSIGNMENT]
_______________ ("Takeout Investor") [Address]
Attention:______________________
Ladies and Gentlemen:
Prudential Securities Realty Funding Corporation ("PSRFC") hereby
notifies you that it does not intend to purchase a 100% ownership interest in
$___________________ in mortgage loans (the "Mortgage Loans") that you
committed to purchase from the [Seller] pursuant to your confirmation of
commitment (the "Commitment") trade-dated ______________, 19_ a copy of which
is attached hereto. Accordingly, the assignment of the Commitment by Seller
to PSRFC is hereby rejected, and PSRFC shall have no obligations thereunder.
Very truly yours,
PRUDENTIAL SECURITIES REALTY
FUNDING CORPORATION
By:__________________________
Name:
Title:
CC: [Seller]
[Custodian]
51
EXHIBIT H
[SETTLEMENT MODIFICATION LETTER]
Prudential Securities Realty Funding Corporation [DATE]
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: _____________________
[SELLER]
[ADDRESS]
Re: The Attached Confirmation of Commitment
Ladies and Gentlemen:
Attached hereto is a correct and complete copy of our
confirmation of commitment ("Commitment"). We hereby confirm that we have
irrevocably approved the Mortgage Loans subject to the Commitment for purchase
by us and we hereby agree to purchase such Mortgage Loan(s) from Prudential
Securities Realty Funding Corporation ("PSRFC") in accordance with the terms
of the Commitment or, if this letter is executed by PSRFC and [SELLER], in
accordance with the terms of the Commitment as amended hereby.
We hereby request that the Commitment be amended as
follows:
(i) the Settlement Date set forth in the Commitment shall
be ___________________;
(ii) the aggregate outstanding principal balance of the Mortgage
Loans shall be $____________________;
(iii) the aggregate amount of accrued interest on the Mortgage
Loans shall be $____________________;
(IV) the trade price shall be _______%; and
(v) the total amount payable to PSRFC shall be $
If we fail to pay you the amount set forth in clause (v) above
on the amended Settlement Date, interest shall accrue on such amount at a rate
equal to the weighted average of the Pass-Through Rates related to such Mortgage
Loans.
52
If the amendments to the Commitment set forth above are acceptable to
you, please so indicate by executing this letter in the appropriate space
provided below and return it to us via facsimile at
[TAKEOUT INVESTOR]
By:
--------------------------
Title:
Agreed to:
[SELLER]
By:
-------------------------------
Title:
Facsimile #:.
---------------------
Agreed to:
PRUDENTIAL SECURITIES REALTY
FUNDING CORPORATION
By: ________________________________ hereto is a correct and complete copy of
our confirmation of commitment ("Commitment"). We hereby confirm that we have
irrevocably approved the Mortgage Loans subject to the Commitment for purchase
by us and we hereby agree to purchase such Mortgage Loan(s) from Prudential
Securities Realty Funding Corporation ("PSRFC") in accordance with the terms
of the Commitment or, if this letter is executed by PSRFC and [SELLER], in
accordance with the terms of the Commitment as amended hereby.
We hereby request that the Commitment be amended as
follows:
(i) the Settlement Date set forth in the Commitment shall
be ____________________;
(ii) the aggregate outstanding principal balance of the
Mortgage Loans shall be $____________________;
(iii) the aggregate amount of accrued interest on the
Mortgage Loans shall be $____________________;
(iv) the trade price shall be _%; and
(v) the total amount payable to PSRFC shall be $
If we fail to pay you the amount set forth in clause (v)
above on the amended Settlement Date, interest shall accrue on
53
such amount at a rate equal to the weighted average of the Pass-Through Rates
related to such Mortgage Loans.
If the amendments to the Commitment set forth above are acceptable to you,
please so indicate by executing this letter in the appropriate space provided
below and return it to us via facsimile at
[TAKEOUT INVESTOR]
By:
---------------------------------
