AMENDED AND RESTATED SERVICING AGREEMENT between INDYMAC BANK, F.S.B. (Servicer) and GOLDMAN SACHS MORTGAGE COMPANY (Owner) Dated as of November 1, 2005 Fixed & Adjustable-Rate First Lien Residential Mortgage Loans
EXECUTION
COPY
AMENDED AND
RESTATED SERVICING AGREEMENT
between
INDYMAC
BANK, F.S.B.
(Servicer)
and
XXXXXXX
XXXXX MORTGAGE COMPANY
(Owner)
Dated
as of November 1, 2005
Fixed
& Adjustable-Rate First Lien Residential Mortgage
Loans
TABLE
OF
CONTENTS
Page
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ARTICLE
I
DEFINITIONS
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ARTICLE
II
REPRESENTATIONS
AND WARRANTIES;
REMEDIES
FOR BREACH
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Section
2.1
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Representations
and Warranties of the Servicer
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13
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Section
2.2
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Remedies
for Breaches of Representations or Warranties.
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15
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ARTICLE
III
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
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Section
3.1
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Identification
of Mortgage Loans; Servicer to Act as Servicer
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15
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Section
3.2
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Liquidation
of Mortgage Loans
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17
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Section
3.3
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Collection
of Mortgage Loan Payments
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18
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Section
3.4
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Establishment
of Custodial Account; Deposits in Custodial Account
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18
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Section
3.5
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Permitted
Withdrawals from the Custodial Account
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19
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Section
3.6
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Establishment
of Escrow Account; Deposits in Escrow Account; Escrow
Analysis
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21
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Section
3.7
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Permitted
Withdrawals from the Escrow Account
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21
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Section
3.8
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Payment
of Taxes, Insurance and Other Charges
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22
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Section
3.9
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Transfer
of Custodial Accounts and Escrow Accounts
|
22
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Section
3.10
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Maintenance
of Hazard Insurance
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22
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Section
3.11
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Maintenance
of Primary Mortgage Insurance Policies; Collections
Thereunder
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23
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Section
3.12
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Fidelity
Bond; Errors and Omissions Insurance
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24
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Section
3.13
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Title,
Management and Disposition of Real Estate Owned
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25
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Section
3.14
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Application
of Proceeds of Insurance to Repair or Restoration
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27
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Section
3.15
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Inspections
|
27
|
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Section
3.16
|
Fair
Credit Reporting Act.
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28
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Section
3.17
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Compliance
with the Privacy Laws
|
28
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ARTICLE
IV
PAYMENTS
TO THE OWNER
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Section
4.1
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Distributions
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28
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i
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Section
4.2
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Reports
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29
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Section
4.3
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Monthly
Advances by Servicer
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29
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ARTICLE
V
GENERAL
SERVICING PROCEDURE; COVENANTS;
REPRESENTATIONS
AND WARRANTIES
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Section
5.1
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Assumption
Agreements
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30
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Section
5.2
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Satisfaction
of Mortgages and Release of Collateral Files
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31
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Section
5.3
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Servicing
Compensation
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32
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Section
5.4
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Annual
Statements as to Compliance
|
32
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Section
5.5
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Annual
Independent Public Accountants' Servicing Report
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33
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Section
5.6
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Owner's
Right to Examine Servicer Records, etc.
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34
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Section
5.7
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Consents
and Approvals
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34
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Section
5.8
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Removal
of Mortgage Loans from Inclusion Under this Agreement Upon a Whole
Loan
Transfer or a Securitization Transaction on One or More Reconstitution
Dates
|
34
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Section
5.9
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Compliance
With REMIC Provisions
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36
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ARTICLE
VI
THE
SERVICER
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Section
6.1
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Indemnification;
Third Party Claims
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37
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Section
6.2
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Servicer
Covenants; Merger or Consolidation of the Servicer
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37
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Section
6.3
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Limitation
on Liability of the Servicer and Others
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38
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Section
6.4
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Servicer
Not to Resign
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38
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Section
6.5
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No
Transfer of Servicing
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39
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ARTICLE
VII
DEFAULT
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Section
7.1
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Events
of Default
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39
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Section
7.2
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Waiver
of Defaults
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41
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Section
7.3
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Survival
of Certain Obligations and Liabilities of the Defaulted
Servicer
|
41
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ARTICLE
VIII
TERMINATION
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Section
8.1
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Termination
of Agreement
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41
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Section
8.2
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Termination
of the Servicer due to an Event of Default
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41
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Section
8.3
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Termination
Without Cause
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42
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ii
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ARTICLE
IX
MISCELLANEOUS
PROVISIONS
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Section
9.1
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Successor
to the Servicer
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42
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Section
9.2
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Amendment
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43
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Section
9.3
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Duration
of Agreement
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43
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Section
9.4
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Governing
Law
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43
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Section
9.5
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General
Interpretive Principles
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43
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Section
9.6
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Reproduction
of Documents
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44
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Section
9.7
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Notices
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44
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Section
9.8
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Severability
of Provisions
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45
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Section
9.9
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Disclosure
of Relationship
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45
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Section
9.10
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Exhibits
and Schedules
|
46
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Section
9.11
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Counterparts;
Successors and Assigns
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46
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Section
9.12
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Effect
of Headings
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46
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Section
9.13
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Other
Agreements Superseded
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46
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Section
9.14
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Confidentiality
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46
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ARTICLE
X
COMPLIANCE
WITH REGULATION AB
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Section
10.1
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Intent
of the Parties; Reasonableness.
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47
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Section
10.2
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Additional
Representations and Warranties of the Servicer.
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47
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Section
10.3
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Information
to Be Provided by the Servicer.
|
48
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Section
10.4
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Servicer
Compliance Statement.
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51
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Section
10.5
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Report
on Assessment of Compliance and Attestation.
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52
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Section
10.6
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Use
of Subservicers and Subcontractors.
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53
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Section
10.7
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Indemnification;
Remedies.
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54
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iii
DESCRIPTION
OF ATTACHMENTS
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Exhibit
A
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MORTGAGE
LOAN SCHEDULE
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Exhibit
B
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LIST
OF COLLATERAL DOCUMENTS
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Exhibit
C
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LIST
OF DOCUMENTS IN CREDIT FILE
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Exhibit
D
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FORM
OF ANNUAL CERTIFICATION
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Exhibit
E
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SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF
COMPLIANCE.
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iv
THIS
SERVICING AGREEMENT (this "Agreement")
dated
as of November 1, 2005, is by and between INDYMAC BANK, F.S.B., in its capacity
as servicer (the “Servicer"),
and
XXXXXXX SACHS MORTGAGE COMPANY, and its successors and assigns, as owner (the
"Owner").
PRELIMINARY
STATEMENT
WHEREAS,
the Owner and IndyMac Bank, F.S.B., (“Indymac”)
have
entered into that certain Amended and Restated Master Mortgage Loan Purchase
Agreement dated as of November 1, 2005 between the Owner, as purchaser and
Indymac, as seller, pursuant to which the Owner will purchase and Indymac will
sell from time to time, certain fixed and adjustable-rate first lien residential
mortgage loans (the “Master
Mortgage Loan Purchase Agreement”);
WHEREAS,
the Servicer is in the business of providing primary servicing of mortgage
loans
and owns the right to service the Mortgage Loans (as hereinafter defined) listed
on the Mortgage Loan Schedule (as hereinafter defined);
WHEREAS,
the Owner and the Servicer are parties to that certain Servicing Agreement,
dated February 1, 2004, as amended (the “Original
Servicing Agreement”),
pursuant to which the Owner requested the Servicer to service the Mortgage
Loans
and the Servicer agreed to service, as an independent contractor, such mortgage
loans for the Owner on the terms and conditions set forth therein;
WHEREAS,
at present time, the Owner and the Servicer desire to amend the Original
Servicing Agreement to make certain modifications as set forth herein with
respect to all Mortgage Loans serviced pursuant to this Agreement or the
Original Servicing Agreement
NOW,
THEREFORE, in consideration of the mutual agreements and covenants herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Servicer and the Owner agree as
follows:
ARTICLE
I
DEFINITIONS
Whenever
used herein, the following words and phrases, unless the context otherwise
requires, shall have the following meanings:
Acceptable
Servicing Procedures:
The
procedures, including prudent collection and loan administration procedures,
and
standard of care employed by prudent mortgage servicers.
Such
standard of care (i) shall not be lower than that the Servicer customarily
employs and exercises in servicing and administering similar mortgage loans
for
its own account, (ii) shall be in accordance with the requirements of the
Servicer’s policies and procedures, (iii) shall be, at a minimum, at least as
prudent and customary in the mortgage origination and servicing business and
(iv) shall be in full compliance with all federal, state and local laws,
ordinances, rules and regulations.
1
Advance:
A
Monthly Advance or Servicing Advance.
Agreement:
This
Amended and Restated Servicing Agreement, including all exhibits and schedules
hereto, and all amendments hereof and supplements hereto.
Ancillary
Income:
All
income if any, derived from any Mortgage Loan, including but not limited to
late
charges, fees received with respect to checks or bank drafts returned by the
related bank for non-sufficient funds, assumption fees, speed pay fees,
reconveyance and demand statement fees, loan modification fees and
reamortization fees.
Applicable
Requirements:
The
(i) terms of the Mortgage and Mortgage Note related to each Mortgage Loan,
(ii) the federal, state, local and foreign laws, statutes, rules,
regulations, ordinances, standards, requirements, administrative rulings, orders
and processes pertaining to Mortgage Loans, including but not limited to those
pertaining to the processing, origination and servicing of the Mortgage Loans
and the servicer’s policies and procedures, (iii) the requirements of a
Primary Mortgage Insurer (if any) with respect to the processing, origination,
insuring, servicing or filing of claims in connection with the Mortgage Loans,
(iv) the requirements of the Owner as set forth in this Agreement, and
(v) the reasonable and customary mortgage servicing practices of prudent
mortgage lending institutions which service mortgage loans of the same type
as
the Mortgage Loans in the jurisdictions in which the related Mortgaged
Properties are located.
ARM
Loan:
A
Mortgage Loan as to which the related Mortgage Note provides that the Mortgage
Interest Rate may be adjusted periodically.
Assignment
of Mortgage:
An
assignment of mortgage, notice of transfer, or equivalent instrument, in
recordable form, sufficient under and complying with the laws of the
jurisdiction wherein the related Mortgaged Property is located to reflect of
record the sale of the Mortgage Loan to the assignee named therein.
Business
Day:
Any day
other than (i) a Saturday or Sunday, or (ii) a day on which banking or
savings and loan institutions in the States of New York or California are
authorized or obligated by law or executive order to be closed.
Closing
Date:
The
date on which the sale and purchase of a Mortgage Loan Package is consummated
between the Owner and Indymac pursuant to the terms of the Master Mortgage
Loan
Purchase Agreement.
Code:
The
Internal Revenue Code of 1986, as amended from time to time, or any successor
statute thereto.
Collateral
Documents:
With
respect to any Mortgage Loan, the mortgage loan documents pertaining to such
Mortgage Loan which are specified in Exhibit
B
hereto
and any additional mortgage documents pertaining to such Mortgage Loan required
to be added to the related Collateral File pursuant to the terms of this
Agreement.
2
Collateral
File:
With
respect to any Mortgage Loan, the file pertaining to such Mortgage Loan that
contains each of the related Collateral Documents.
Commission:
The
United States Securities and Exchange Commission.
Condemnation
Proceeds:
All
awards or settlements in respect of a taking of all or part of a Mortgaged
Property by exercise of the power of eminent domain or
condemnation.
Consents:
shall
mean the unconditional written consent or approval, as necessary, of an Investor
and any applicable Insurer to the Servicer’s servicing of the Mortgage Loans
hereunder.
Cooperative
Corporation:
The
entity that holds title (fee or an acceptable leasehold estate) to the real
property and improvements constituting the Cooperative Property and which
governs the Cooperative Property, which Cooperative Corporation must qualify
as
a Cooperative Housing Corporation under Section 216 of the Code.
Cooperative
Loan:
Any
Mortgage Loan secured by Coop Shares and a Proprietary Lease.
Cooperative
Property:
The
real property and improvements owned by the Cooperative Corporation, including
the allocation of individual dwelling units to the holders of the Coop Shares
of
the Cooperative Corporation.
Coop
Shares:
Shares
issued by a Cooperative Corporation.
Cooperative
Unit:
A
single family dwelling located in a Cooperative Property.
Credit
File:
With
respect to any Mortgage Loan, a file pertaining to such Mortgage Loan and
containing copies of the mortgage loan documents described on Exhibit
C
attached
hereto, the credit documentation relating to the origination of such Mortgage
Loan and copies of the Collateral Documents. Each Credit File shall be
maintained by the Servicer (either on paper or on microfilm or any other
comparable medium).
Custodial
Account:
The
account or accounts created and maintained pursuant to Section 3.4 of this
Agreement which account(s) shall be an Eligible Account.
Custodial
Agreement:
Any
agreement with respect to the Mortgage Loans governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, entered into among Indymac, the Servicer and JPMorgan
Chase Bank.
Custodian:
With
respect to any Mortgage Loan and the related Collateral File, JPMorgan Chase
Bank and any successor custodian under any custodial agreement which may be
entered into between the Servicer, the Owner or any subsequent Owner and the
custodian named therein regarding the warehousing and safekeeping of such
Collateral File.
3
Cut-off
Date:
With
respect to a Mortgage Loan Package, the first day of the month in which the
related Cut-off Date occurs or such other date as may be mutually agreed to
by
the parties.
Default:
Any
condition or circumstance that is, or with notice or the lapse of time or both,
would become, an Event of Default.
Depositor:
The
depositor, as such term is defined in Regulation AB, with respect to any
Securitization Transaction.
Determination
Date:
The
Business Day immediately preceding the related Remittance Date.
Due
Date:
With
respect to any Mortgage Loan, the first day of the month on which Monthly
Payments on such Mortgage Loan are due, exclusive of any days of
grace.
Due
Period:
With
respect to each Remittance Date, the period beginning on the second day of
the
month immediately preceding the month of such Remittance Date and ending on
the
first day of the month of such Remittance Date.
Eligible
Account:
An
account or accounts maintained with a Qualified Depository.
Escrow
Account:
The
separate account or accounts created and maintained pursuant to Section
3.6.
Escrow
Payments:
The
amounts constituting ground rents, taxes, assessments, water rates, mortgage
insurance premiums, if any, fire and hazard insurance premiums, and other
payments required to be escrowed by the Mortgagor with the mortgagee pursuant
to
any Mortgage Loan.
Event
of Default:
Any one
of the conditions or circumstances enumerated in Section 7.1.
Exchange
Act.
The
Securities Exchange Act of 1934, as amended.
FDIC:
The
Federal Deposit Insurance Corporation or any successor thereto.
Xxxxxx
Xxx:
The
Federal National Mortgage Association, or any successor thereto.
Fidelity
Bond:
A
fidelity bond to be obtained by the Servicer pursuant to Section
3.12.
4
Xxxxxxx
Mac:
The
Federal Home Loan Mortgage Corporation or any successor thereto.
Gross
Margin:
With
respect to each ARM Loan, the fixed percentage amount set forth in the related
Mortgage Note as shown in the Mortgage Loan Schedule, which amount is added
to
the Index in accordance with the terms of the related Mortgage Note to determine
on each Interest Rate Adjustment Date the Mortgage Interest Rate for such
Mortgage Loan.
Index:
With
respect to any ARM Loan, the index set forth in the applicable Mortgage Note
which is added to the Gross Margin to determine the Mortgage Interest Rate
on
each Interest Rate Adjustment Date. In the event the Index becomes unavailable
for any reason, the Servicer shall select an alternative index, in accordance
with the terms of the Mortgage Note, and such alternative index shall thereafter
be the Index for such Mortgage Loan.
Indymac:
IndyMac
Bank, F.S.B., a federal savings bank and its successors in
interest.
Indymac
Information:
As
defined in Section 5.8.
Initial
Rate Cap:
As to
each ARM Loan, the maximum increase or decrease in the Mortgage Interest Rate
on
the first Interest Rate Adjustment Date as provided in the related Mortgage
Note.
Insurance
Proceeds:
Proceeds of any Primary Mortgage Insurance Policy, any title policy, any hazard
insurance policy or any other insurance policy covering a Mortgage Loan or
the
related Mortgaged Property, including any amounts required to be deposited
in
the Custodial Account pursuant to Section 3.10, to the extent such proceeds
are
not to be applied to the restoration of the related Mortgaged Property or
released to the Mortgagor in accordance with Acceptable Servicing Procedures
and
Section 3.14.
Interest
Rate Adjustment Date:
As to
any ARM Loan, the date specified in a Mortgage Note on which the Mortgage
Interest Rate for the related Mortgage Loan is subject to
adjustment.
Investor:
With
respect to any Mortgage Loan, a Person who has a beneficial interest in, or
is a
record owner of, such Mortgage Loan or any trustee acting on behalf of any
such
Person.
Late
Collections:
With
respect to any Mortgage Loan, all amounts (other than Monthly Advances) received
during any Due Period, whether as late payments of Monthly Payments or as
Insurance Proceeds, Liquidation Proceeds, Condemnation Proceeds or otherwise,
which represent late payments or collections of Monthly Payments due but
delinquent for a previous Due Period and not previously recovered.
Liquidation
Proceeds:
Cash
received in connection with the liquidation of a defaulted Mortgage Loan,
whether through the sale or assignment of the Mortgage Loan, trustee's sale,
foreclosure sale or otherwise, or in connection with the sale of the Mortgaged
Property if the Mortgaged Property is a REO Property.
5
LPMI
Fee:
The
portion of the Mortgage Interest Rate relating to a LPMI Loan, which is set
forth on the related Mortgage Loan Schedule, to be retained by the Servicer
to
pay the premium due on a Primary Mortgage Insurance Policy with respect to
a
LPMI Loan.
LPMI
Loan:
Any
Mortgage Loan with respect to which the Servicer is responsible for paying
the
premium due on the related Primary Mortgage Insurance Policy with the proceeds
generated by the LPMI Fee relating to such Mortgage Loan, as set forth on the
related Mortgage Loan Schedule.
Losses:
Any
claims, penalties, fines, forfeitures, damages, liabilities, losses and
expenses, including reasonable attorneys' fees.
Master
Servicer:
As
defined in Section 5.4(a).
Maturity
Date:
With
respect to any Mortgage Loan, the maturity date of the related Mortgage Note
and
Mortgage as specified therein.
MERS:
Mortgage Electronic Registration, Inc. a corporation organized and existing
under the laws of the State of Delaware, or any successor thereto.
MERS
Mortgage Loan:
Any
Mortgage Loan registered with MERS on the MERS System.
MERS
®
System:
The
system of recording transfers of mortgages electronically maintained by
MERS.
Monthly
Advance:
Commencing with each Monthly Payment due on or after the related Cut-off Date,
the portion of each Monthly Payment that is delinquent with respect to each
Mortgage Loan at the close of business on the Determination Date required to
be
advanced by the Servicer pursuant to Section 4.3 on the Business Day immediately
preceding the Remittance Date of the related month.
Monthly
Payment:
The
scheduled monthly payment of principal and interest on a Mortgage Loan which
is
payable by a Mortgagor from time to time under the related Mortgage
Note.
Mortgage:
The
mortgage, mortgage deed, deed of trust or other instrument creating a first
lien
on or first priority ownership interest on an unsubordinated estate in fee
simple in real property securing the Mortgage Note; except that with respect
to
real property located in jurisdictions in which the use of leasehold estates
for
residential properties is a widely-accepted practice, the mortgage, deed of
trust or other instrument securing the Mortgage Note may secure and create
a
first lien upon a leasehold estate of the Mortgagor, as the case may be,
including any riders, addenda, assumption agreements or modifications relating
thereto.
Mortgage
Interest Rate:
As to
each Mortgage Loan, the annual rate at which interest accrues on such Mortgage
Loan and, with respect to an ARM Loan, as adjusted from time to time in
accordance with the provisions of the related Mortgage Note.
6
Mortgage
Loan:
Any
mortgage loan that is sold pursuant to this Agreement, as evidenced by such
mortgage loan’s inclusion on the related Mortgage Loan Schedule, which mortgage
loan includes, without limitation, the Mortgage File, the Monthly Payments,
Principal Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance
Proceeds (if applicable) and all other rights, benefits, proceeds and
obligations arising from or in connection with such Mortgage Loan, excluding
the
servicing rights relating thereto. Unless the context requires otherwise, any
reference to the Mortgage Loans in this Agreement shall refer to the Mortgage
Loans constituting a Mortgage Loan Package.
Mortgage
Loan Package:
Pools
of Mortgage Loans sold to the Owner pursuant the Master Mortgage Loan Purchase
Agreement.
Mortgage
Loan Remittance Rate:
with
respect to each Mortgage Loan, the interest rate payable to the Owner on each
Remittance Date which shall equal the Mortgage Interest Rate less the Servicing
Fee and any LPMI Fees, if applicable.
Mortgage
Loan Schedule:
A
schedule of Mortgage Loans annexed hereto as Exhibit A, such schedule setting
forth the following information with respect to each Mortgage Loan: (1) the
Indymac’s Mortgage Loan number; (2) the address, city, state and zip code of the
Mortgaged Property (or, in the case of each Cooperative Loan, of the related
Cooperative Unit); (3) a code indicating whether the Mortgagor is self-employed;
(4) a code indicating whether the Mortgaged Property is owner-occupied,
investment property or a second home; (5) a code indicating whether the
Mortgaged Property is a single family residence, two-family residence,
three-family residence, four family residence, condominium, manufactured
housing, mixed-use property, raw land and other non-residential properties,
planned unit development or cooperative stock in a cooperative housing
corporation; (6) the purpose of the Mortgage Loan; (7) the type of Mortgage
Loan (i.e., Fixed Rate or Adjustable Rate Mortgage Loan); (8) the Mortgage
Interest Rate at origination; (9) the current Mortgage Interest Rate; (10)
whether the Mortgage Loan has Monthly Payments that are interest only for a
period of time; (11) the Servicing Fee Rate; (12) the current Monthly Payment;
(13) the original term to maturity; (14) the remaining term to maturity; (15)
the principal balance of the Mortgage Loan as of the Cut-off Date after
deduction of payments of principal due on or before the Cut-off Date whether
or
not collected; (16) the LTV at origination and if the Mortgage Loan has a second
lien, combined LTV at origination; (17) the actual principal balance of the
Mortgage Loan as of the Cut-off Date; (18) social security number of the
Mortgagor; (19) a code indicating whether the Mortgage Loan has negative
amortization and the maximum amount of such negative amortization; (20) a code
indicating whether the Mortgage Loan had a second lien at origination; (21)
if
the Mortgage Loan has a second lien, combined loan balance as of the Cut-off
Date; (22) a code indicating whether the Mortgaged Property is a leasehold
estate; (23) the due date of the Mortgage Loan; (24) whether the Mortgage Loan
is insured by a Primary Mortgage Insurance Policy and the name of the insurer;
(25) the certificate number of the Primary Mortgage Insurance Policy; (26)
the
amount of coverage of the Primary Mortgage Insurance Policy; (27) the type
of
appraisal; (28) a code indicating whether the Mortgage Loan is a MERS Mortgage
Loan; (29) a code indicating whether the Mortgage Loan is subject to a prepay
penalty and the terms of such prepayment penalty; (30) documentation type
(including asset and income type); (31) first payment date; (32) the schedule
of
the payment delinquencies in the prior 12 months and (33) FICO score. With
respect to any Adjustable Rate Mortgage Loan: (a) the Gross Margin; (b) the
Periodic Rate Cap; (c) the Lifetime Rate Cap; (d) the first Interest Rate
Adjustment Date cap and the Interest Rate Adjustment Date frequency; (e) the
minimum Mortgage Interest Rate; (f) the first Interest Rate Adjustment Date
immediately following the Cut-off Date; and (g) the Index, including the
methodology for rounding (e.g. rounded upward, if necessary, to the next nearest
ten thousandth (.0001)) and the applicable time frame for determining the
Index.
7
Mortgage
Note:
The
note or other evidence of the indebtedness of a Mortgagor secured by a Mortgage,
including any riders, addenda, assumption agreements or modifications relating
thereto.
Mortgaged
Property:
With
respect to a Mortgage Loan that is not a Cooperative Loan, the underlying real
property securing repayment of a Mortgage Note, consisting of a single parcel
of
real estate considered to be real estate under the laws of the State in which
such real property is located, which may include condominium units and planned
unit developments, improved by a residential dwelling; except that with respect
to real property located in jurisdictions in which the use of leasehold estates
for residential properties is a widely-accepted practice, a leasehold estate
of
the Mortgagor, the term of which is equal to or longer than the term of the
Mortgage. With respect to a Cooperative Loan, the stock allocated to a dwelling
unit in the residential cooperative housing corporation that was pledged to
secure such Cooperative Loan and the related Cooperative Lease.
Mortgagor:
The
obligor on a Mortgage Note and his/her successors in title to the Mortgage
Property.
Nonrecoverable
Advance:
Any
portion of any of a Monthly Advance or Servicing Advance previously made or
proposed to be made in respect of a Mortgage Loan by the Servicer hereunder
which, in the good faith judgment of the Servicer, will not be ultimately
recoverable from Late Collections.
Offering
Materials:
As
defined in Section 5.8(d).
Officer’s
Certificate:
A
certificate signed by the Chairman of the Board, the Vice Chairman of the Board,
the President or a Vice President of the Servicer, and delivered to the Owner
as
required by this Agreement.
Opinion
of Counsel:
A
written opinion of counsel, who may be an employee of the Servicer or an
affiliate thereof, reasonably acceptable to the Owner.
Owner:
Xxxxxxx
Xxxxx Mortgage Company and its successors and assigns.
Periodic
Rate Cap:
With
respect to each ARM Loan, the provision of each Mortgage Note which provides
for
an absolute maximum amount by which the Mortgage Interest Rate therein may
increase or decrease on an Interest Rate Adjustment Date above or below the
Mortgage Interest Rate previously in effect, equal to the rate set forth on
the
Mortgage Loan Schedule per adjustment.
Permitted
Instruments:
Any one
or more of the following obligations or securities:
8
(i) direct
obligations of, or obligations fully guaranteed as to principal and interest
by,
the United States or any agency or instrumentality thereof, provided
such
obligations are backed by the full faith and credit of the United
States;
(ii) repurchase
obligations with respect to any security described in clause (i) above,
provided
that the
unsecured long-term obligations of the party agreeing to repurchase such
obligations are at the time rated by Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc. (“S&P”)
in one
of its three highest rating categories;
(iii) federal
funds, certificates of deposit, time deposits, and bankers' acceptances of
any
bank or trust company incorporated under the laws of the United States or any
state, provided
that the
long-term debt obligations of such bank or trust company (or, in the case of
the
principal bank in a bank holding company system, the long-term debt obligations
of the bank holding company) at the date of acquisition thereof have been rated
by the S&P in one of its three highest rating categories;
(iv) commercial
paper of any corporation incorporated under the laws of the United States or
any
state thereof which on the date of acquisition has been rated by the S&P in
its highest short-term rating category; and
(v) any
other
obligation or security acceptable to Standard & Poor's Corporation in
respect of mortgage pass-through certificates rated in one of its three highest
rating categories, as evidenced by a letter from the S&P to such
effect.
Person:
Any
individual, corporation, partnership, joint venture, association, joint-stock
company, trust, limited liability company, unincorporated organization or
government or any agency or political subdivision thereof.
Prepayment
Charge:
With
respect to any Mortgage Loan, the prepayment premium or charge, if any, required
under the terms of the related Mortgage Note to be paid in connection with
a
Principal Prepayment, to the extent permitted by applicable law.
Prepayment
Period:
With
respect to any Remittance Date, the Prepayment Period shall commence on and
include the second day of the prior month through and including the first day
of
the month in which such Remittance Date occurs.
Prepayment
Interest Shortfall Amount:
With
respect to any Remittance Date and Mortgage Loan that was subject to a Principal
Prepayment in full or in part during the related Principal Prepayment Period,
which Principal Prepayment was applied to such Mortgage Loan prior to such
Mortgage Loan's Due Date in such calendar month, the amount of interest (at
the
Mortgage Loan Remittance Rate) that would have accrued on the amount of such
Principal Prepayment during the period commencing on the date as of which such
Principal Prepayment was applied to such Mortgage Loan and ending on the day
immediately preceding such Due Date, inclusive.
9
Primary
Mortgage Insurance Policy:
With
respect to any Mortgage Loan, the policy of primary mortgage guaranty insurance
(including all endorsements thereto), if any, issued by a Qualified Insurer
with
respect to such Mortgage Loan, or any replacement policy.
Primary
Mortgage Insurer:
The
named insurer under any Primary Mortgage Insurance Policy.
Prime:
As of
any date of determination, the annual interest rate, adjusted daily, published
from time to time in The Wall Street Journal (Western Edition) as the “PRIME
RATE” in the “MONEY RATES” section.
Principal
Prepayment:
Any
payment or other recovery of principal on a Mortgage Loan (other than
Condemnation Proceeds, Insurance Proceeds, and Liquidation Proceeds) which
is
received in advance of its scheduled Due Date (not including any Prepayment
Charge) and is not accompanied by an amount of interest representing scheduled
interest due on any date or dates in any month or months subsequent to the
month
of prepayment.
Privacy
Laws:
Title V
of the Xxxxx-Xxxxx-Xxxxxx Act of 1999, as amended, and all applicable
regulations promulgated thereunder
Proprietary
Lease:
With
respect to any Cooperative Unit, a lease or occupancy agreement between a
Cooperative Corporation and a holder of related Coop Shares.
Qualified
Depository:
(i) A depository, the long-term unsecured debt obligations of which are
rated by a nationally recognized statistical rating agency in one of its two
highest rating categories at the time of any deposit therein, or (ii) a
depository, the deposits of which are fully insured to the maximum extent
permitted by the FDIC or (iii) the corporate trust department of a national
bank; provided that in case of (ii) and (iii) above, they maintain a rating
by a
nationally recognized statistical rating agency in the highest rating categories
for short term debt obligations.
Qualified
Insurer:
An
insurance company duly qualified as such under the laws of the states in which
the Mortgaged Properties are located, duly authorized and licensed in such
states to transact the applicable insurance business and to write the insurance
provided, which insurer is approved in such capacity by an Agency.
Reconstitution:
Any
Securitization Transaction or Whole Loan Transfer.
Reconstitution
Agreements:
The
agreement or agreements entered into by the Servicer and the Owner and/or
certain third parties on the Reconstitution Date or Dates with respect to any
or
all of the Mortgage Loans serviced hereunder, in connection with a Whole Loan
Transfer or a Securitization Transaction. Such agreement or agreements shall
prescribe the rights and obligations of the Servicer in servicing the related
Mortgage Loans.
Reconstitution
Date:
The
date or dates on which any or all of the Mortgage Loans serviced under this
Agreement shall be removed from this Agreement and reconstituted as part of
a
Whole Loan Transfer or Securitization Transaction pursuant to Section 5.9
hereof. On such date, the Mortgage Loans transferred shall cease to be covered
by this Agreement and the Servicer shall cease to service those Mortgage Loans
under this Agreement in accordance with the termination provisions set forth
in
Section 5.9 hereof.
10
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.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of Section 860D of
the Code.
REMIC
Provisions:
Provisions of the federal income tax law relating to a REMIC, which appear
at
Section 860A through 860G of Subchapter M of Chapter 1, Subtitle A of the
Code, and related provisions, and regulations, rulings or pronouncements
promulgated thereunder, as the foregoing may be in effect from time to
time.
Remittance
Advice Date:
The
10th
day of
each month or, if such 10th
day is
not a Business Day, the first Business Day immediately following such
day.
Remittance
Date:
With
respect to each Mortgage Loan: the eighteenth (18th)
day of
any month, beginning with the eighteenth (18th)
day of
the month next following the month in which the related Cut-off Date occurs,
or
if such eighteenth (18th)
day is
not a Business Day, the first Business Day immediately following such
day.
REO
Property:
A
Mortgaged Property acquired in foreclosure or by deed in lieu of foreclosure,
as
described in Section 3.13.
Sarbanes
Certifying Party:
A
Person who provides certification required under the Xxxxxxxx-Xxxxx Act of
2002
in connection with a Securitization or other securitization
transaction.
Securities
Act:
The
Securities Act of 1933, as amended.
Securitization:
The
transfer of the Mortgage Loans to a trust formed as part of a publicly issued
and/or privately placed, rated securitization, including the issuance of the
related Securities.
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.
11
Security
Agreement:
With
respect to any Cooperative Loan, the agreement between the owner of the related
Coop Shares and the originator of the related Mortgage Note that defines the
terms of the security interest in such Coop Shares and the related Proprietary
Lease.
Servicer:
IndyMac
or any successor to the Servicer as permitted under this Agreement.
Servicer
Information:
As
defined in Section 10.7(a).
Servicing
Advances:
All
customary, reasonable, and necessary "out of pocket" costs and expenses
(including reasonable attorneys' fees and disbursements) that are incurred
by
the Servicer in the performance of its servicing obligations hereunder,
including, but not limited to, the cost of (i) the preservation,
restoration, and protection of the Mortgaged Property, (ii) any enforcement
or judicial proceedings, including foreclosures, (iii) the management and
liquidation of the Mortgaged Property if the Mortgaged Property is acquired
in
satisfaction of the Mortgage, and (iv) compliance with the obligations of
this Agreement, including without limitation under Sections 3.8 and
3.10.
Servicing
Criteria:
The
“servicing criteria” set forth in Item 1122(d) of Regulation AB, as such may be
amended from time to time.
Servicing
Fee:
With
respect to each Mortgage Loan being serviced and administered pursuant to this
Agreement, the amount of the annual fee payable to the Servicer as compensation
for servicing and administering such Mortgage Loan and for managing and
disposing of REO Property in accordance with the terms of this Agreement. For
each Mortgage Loan, such fee shall, for a period of one full month, be equal
to
one-twelfth of the product of (i) the Servicing Fee Rate, multiplied by
(ii) the outstanding Unpaid Principal Balance of such Mortgage Loan as of
the first day of such month, and shall be payable in accordance with Section
5.3. With respect to any REO Property that is being managed by the Servicer
in
accordance with Section 3.13 of this Agreement, such fee shall be payable
through and until the disposition of such REO Property or the transfer of the
REO Property to the Owner for management by the Owner, and the amount of such
fee shall be based upon the Unpaid Principal Balance of the related Mortgage
Loan at the time of the related foreclosure.
Servicing
Fee Rate:
As set
forth on the Mortgage Loan Schedule.
Servicing
File:
As to
each Mortgage Loan, the copies of the Collateral Documents, as well as the
credit and closing packages, disclosures, copies of the all other files, books,
records and documents necessary to (a) establish the eligibility of the Mortgage
Loan for insurance by a Qualified Insurer, if any; and/or (b) service the
Mortgage Loan in accordance with Acceptable Servicing Procedures, including
the
documents listed on Exhibit
B
hereto,
some of which maybe held by the Custodian.
Subcontractor:
Any
vendor, subcontractor or other Person that is not responsible for the overall
servicing (as “servicing” is commonly understood by participants in the
mortgage-backed securities market) of Mortgage Loans but performs one or more
discrete functions identified in Item 1122(d) of Regulation AB with respect
to
Mortgage Loans under the direction or authority of the Servicer or a
Subservicer.
12
Subservicer:
Any
Person that services Mortgage Loans on behalf of the Servicer or any Subservicer
and is responsible for the performance (whether directly or through Subservicers
or Subcontractors) of a substantial portion of the material servicing functions
required to be performed by the Servicer under this Agreement or any
Reconstitution Agreement that are identified in Item 1122(d) of Regulation
AB.
Unpaid
Principal Balance:
With
respect to each Mortgage Loan as of any date of determination: (i) the unpaid
principal balance of the Mortgage Loan at the Cut-off Date after giving effect
to payments of principal due on or before such date, whether or not received,
minus
(ii) all
amounts previously distributed to the Owner with respect to the related Mortgage
Loan representing payments or recoveries of principal or advances in lieu
thereof.
Whole
Loan Transfer:
Any
sale or transfer of some or all of the Mortgage Loans, other than a
Securitization Transaction.
3/1
Loan:
An ARM
Loan where the Mortgage Interest Rate is fixed for the first 36
months.
5/1
Loan:
An ARM
Loan where the Mortgage Interest Rate is fixed for the first 60
months.
7/1
Loan:
An ARM
Loan where the Mortgage Interest Rate is fixed for the first 84
months.
10/1
Loan:
An ARM
Loan where the Mortgage Interest Rate is fixed for the first 120
months.
Any
capitalized term used herein and not otherwise defined, shall have the meaning
assigned to such term in the Master Mortgage Loan Purchase
Agreement.
ARTICLE
II
REPRESENTATIONS
AND WARRANTIES;
REMEDIES
FOR BREACH
Section
2.1 Representations
and Warranties of the Servicer
With
respect to a Mortgage Loan Package, the Servicer represents, warrants and
covenants to the Owner that, as of the related Closing Date:
(a) The
Servicer is duly organized, validly existing and in good standing under the
laws
of the jurisdiction in which it is organized and is qualified and licensed
to
transact business in and is in good standing under the laws of each state where
each Mortgaged Property is located to the extent necessary to ensure the
enforceability of each Mortgage Loan and the servicing of the Mortgage Loan
in
accordance with the terms of this Agreement. The execution, delivery and
performance of this Agreement (including all instruments of transfer to be
delivered pursuant to this Agreement) by the Servicer and the consummation
of
the transactions contemplated hereby have been duly and validly authorized.
This
Agreement evidences the valid, binding and enforceable obligation of the
Servicer; and all requisite action has been taken by the Servicer to make this
Agreement valid and binding upon the Servicer in accordance with its
term;
13
(b) The
Servicer has the full power and authority to (i) perform and enter into and
consummate all transactions contemplated by this Agreement and (ii) to service
each Mortgage Loan;
(c) The
consummation of the transactions contemplated by this Agreement are in the
ordinary course of business of the Servicer, which is in the business of
servicing loans;
(d) Neither
the consummation of the transactions contemplated hereby, nor the fulfillment
of
or compliance with the terms and conditions of this Agreement, will conflict
with or result in a breach of any of the terms, conditions or provisions of
the
Servicer's [charter] or result in a material breach of any legal restriction
or
any material agreement or instrument to which the Servicer is now a party or
by
which it is bound, or constitute a material default or result in an acceleration
under any of the foregoing, or result in the violation of any law, rule,
regulation, order, judgment or decree to which the Servicer or its property
is
subject;
(e) The
Servicer is an approved servicer for Xxxxxx Mae and Xxxxxxx Mac in good
standing. No event has occurred, including a change in insurance coverage,
which
would make the Servicer unable to comply with Xxxxxx Mae or Xxxxxxx Mac
eligibility requirements;
(f) There
is
no action, suit, proceeding, investigation or litigation pending or, to the
Servicer’s knowledge, threatened, which either in any one instance or in the
aggregate, if determined adversely to the Servicer would materially and
adversely affect the Servicer’s ability to service the Mortgage Loans hereunder
in accordance with the terms hereof, or the Servicer’s ability to perform its
obligations under this Agreement;
(g) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Servicer,
of
or compliance by the Servicer with, this Agreement or the consummation of the
transactions contemplated by this Agreement, or if required, such consent,
approval, authorization or order has been obtained prior to the related Closing
Date;
(h) The
Servicer acknowledges and agrees that the Servicing Fee represents reasonable
compensation for performing such services and that the entire Servicing Fee
shall be treated by the Servicer, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans pursuant
to this Agreement;
(i) The
Servicer does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant contained in this
Agreement;
14
(j) The
Servicer is a member of MERS in good standing, and will comply in all material
respects with the rules and procedures of MERS in connection with the servicing
of the Mortgage Loans registered with MERS;
(k) The
Servicer has serviced, and shall at all times service, the Mortgage Loans in
accordance with the Acceptable Servicing Procedures, the Mortgage Note and
applicable federal, state and local laws and regulations, including, without
limitation, usury, truth-in-lending, real estate settlement procedures, consumer
credit protection, equal credit opportunity or disclosure laws, and the Servicer
shall maintain in its possession, available for the Owner’s inspection and shall
deliver to the Owner upon demand, evidence of compliance with all such
requirements. 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, have been made
or
obtained from the appropriate authorities;
(l) The
Servicer has fully furnished (or caused to be furnished), in accordance with
the
Fair Credit Reporting Act and its implementing regulations, accurate and
complete information (e.g., favorable and unfavorable) on its borrower credit
files to Equifax, Experian and Trans Union Credit Information Company, or any
their successors and assigns (three of the credit repositories), on a monthly
basis; and
(m) No
statement, report or other document prepared and furnished by the Servicer
or to
be prepared and furnished by the Servicer pursuant to this Agreement in
connection with the transactions contemplated hereby contain or will contain
any
untrue statement of fact or omit to state a fact necessary to make the
statements contained therein not misleading.
Section
2.2 Remedies
for Breaches of Representations or Warranties.
The
Servicer shall indemnify the Owner, its affiliates and their respective
directors, officers and employees and hold such Persons harmless against any
Losses and related costs, judgments, and other costs and expenses resulting
from
a breach of the Servicer’s representations and warranties contained in Section
2.1 that materially and adversely affects the interests of the Owner in or
the
value of one or more of the Mortgage Loans. The obligations of the Servicer
set
forth in this Section 2.2 to indemnify the Owner as provided in this Section
2.2
constitute the sole remedies of the Owner with respect to a breach of the
foregoing representations and warranties.
ARTICLE
III
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
Section
3.1 Identification
of Mortgage Loans; Servicer to Act as Servicer
(a) The
Servicer, as independent contractor, shall commence servicing and administering
each Mortgage Loan on behalf of the Owner from and after the Cut-off Date in
accordance with the terms and conditions of this Agreement and Acceptable
Servicing Procedures and the terms of the Mortgage Notes and the Mortgages.
Except as otherwise expressly provided in this Agreement, the Servicer shall
have full power and authority, acting alone, to do any and all things reasonably
consistent with the terms of this Agreement, including but not limited to the
following: (i) to execute and deliver, on behalf of the Owner, customary
consents or waivers and other instruments and documents, (ii) to consent to
transfers of any Mortgaged Property and assumptions of the Mortgage Notes and
related Mortgages (but only in the manner provided in this Agreement), (iii)
to
collect any Insurance Proceeds and other Liquidation Proceeds, and (iv) to
effectuate foreclosure or other conversion of the ownership of the Mortgaged
Property securing any Mortgage Loan; provided that the Servicer shall not take
any action that is inconsistent with or prejudices the interests of the Owner
under this Agreement. The Servicer further is authorized and empowered by the
Owner, in its own name when the Servicer, believes it appropriate in its best
judgment to register any Mortgage Loan on the MERS® System, or cause the removal
from the registration of any Mortgage Loan on the MERS® System, to execute and
deliver, on behalf of the Owner, any and all instruments of assignment and
other
comparable instruments with respect to such assignment or re-recording of a
Mortgage in the name of MERS, solely as nominee for the Trustee and its
successors and assigns. The Servicer shall at all times act in the best
interests of the Owner in performing its obligations under this
Agreement.
15
(b) The
documents comprising the Collateral File relating to each Mortgage Loan serviced
hereunder and that are retained by the Servicer pursuant to the terms hereof,
together with all other documents with respect to each such Mortgage Loan which
are prepared by or which come into the possession of the Servicer, shall
immediately vest in the Owner and shall be held and maintained in trust by
the
Servicer at the will of the Owner and in a custodial capacity only. The
documents comprising each Collateral File and all related documents which come
into the possession of the Servicer and are so held by the Servicer shall be
segregated from the other books and records of the Servicer and shall be
appropriately marked to clearly reflect the ownership interest of the Owner
in
such Collateral File and related documents. The Servicer shall release its
custody of any such documents only in accordance with written instructions
from
the Owner, unless such release is required as incidental to the Servicer’s
servicing of the Mortgage Loans.
The
Servicer shall maintain with respect to each Mortgage Loan and shall make
available for inspection by the Owner or its designee the related Servicing
File
during the time the Owner retains ownership of a Mortgage Loan and thereafter
in
accordance with Applicable Law. The Servicer shall keep at its servicing office
books and records in which, subject to such reasonable regulations as it may
prescribe, the Servicer shall note transfers of Mortgage Loans. No transfer
of a
Mortgage Loan may be made unless such transfer is in compliance with the terms
hereof. For the purposes of this Agreement, the Servicer shall be under no
obligation to deal with any person with respect to this Agreement or the
Mortgage Loans unless the books and records show such person as the owner of
the
Mortgage Loan. The Owner may, subject to the terms of this Agreement, sell
and
transfer one or more of the Mortgage Loans, provided, however, that in no event
shall there be more than four Persons at any given time having the status of
“Owner” hereunder. The Owner also shall advise the Servicer of the transfer.
Upon receipt of notice of the transfer, the Servicer shall xxxx its books and
records to reflect the ownership of the Mortgage Loans of such assignee, and
shall release the previous Owner from its obligations hereunder with respect
to
the Mortgage Loans sold or transferred. If the Servicer receives written
notification of a transfer less than five (5) Business Days before the monthly
Determination Date, the Servicer’s duties to remit and report to the new
purchaser(s) as required by Section 5.9 hereof shall begin with the first
Determination Date after the Reconstitution Date.
16
(c) Consistent
with the terms of this Agreement and subject to the REMIC Provisions if the
Mortgage Loans have been transferred to a REMIC, the Servicer may waive, modify
or vary any term of any Mortgage Loan or consent to the postponement of strict
compliance with any such term or in any manner grant indulgence to any Mortgagor
if, in the Servicer's reasonable and prudent determination, such waiver,
modification, variation, postponement or indulgence is in the best interests
of
and is not materially adverse to the Owner and will not result in the impairment
of coverage under any Primary Mortgage Insurance Policy; provided,
however,
that
the Servicer may not, without the prior written consent of the Owner, (i) permit
any modification with respect to any Mortgage Loan that would change the
Mortgage Interest Rate (other than by adjustments required by the terms of
the
related Mortgage Note), the
Lifetime Rate Cap (if applicable), the Initial Rate Cap (if applicable), the
Periodic Rate Cap (if applicable) or the Gross Margin (if applicable), (ii)
defer or forgive the payment of any principal or interest, (iii) reduce the
outstanding principal amount (except to reflect actual payments of principal),
(iv) except other than pursuant to the terms of the Mortgage Loan, make any
advances of additional principal or (v) extend the final maturity date on such
Mortgage Loan. In the event of any such modification which permits the deferral
of interest or principal payments on any Mortgage Loan, the Servicer shall,
on
the Business Day immediately preceding the Remittance Date in any month in
which
any such principal or interest payment has been deferred, deposit in the
Custodial Account from its own funds, in accordance with Section 4.3, the
difference between (a) such month’s principal and one month’s interest at the
Mortgage Loan Remittance Rate on the Unpaid Principal Balance of such Mortgage
Loan and (b) the amount paid by the Mortgagor. Without limiting the generality
of the foregoing, the Servicer is hereby authorized and empowered to execute
and
deliver on behalf of itself and the Owner in connection with any Mortgage Loan
all instruments of satisfaction, cancellation or full release upon receipt
by
the Servicer of payment in full of the Unpaid Principal Balance or, with the
prior written consent of the Owner, partial release or discharge, and all other
comparable instruments with respect to the Mortgage Loans and the Mortgaged
Properties. The Servicer shall prepare and deliver to the Owner such documents
requiring execution and delivery as are necessary or appropriate to enable
the
Servicer to service and administer the Mortgage Loans to the extent that the
Servicer is not permitted to execute and deliver such documents pursuant to
the
preceding sentence. Upon receipt of such documents, the Owner shall execute
such
documents and deliver them to the Servicer. If reasonably required by the
Servicer, the Owner shall furnish the Servicer with any powers of attorney
and
other documents necessary or appropriate to enable the Servicer to carry out
its
servicing and administrative duties under this Agreement.
(d) As
to
each ARM Loan, the Servicer shall make periodic Mortgage Interest Rate and
Monthly Payment adjustments, as applicable, in strict compliance with
(i) the terms of the Mortgage and Mortgage Note, (ii) all applicable
law, and (iii) Acceptable Servicing Procedures.
Section
3.2 Liquidation
of Mortgage Loans
In
the
event that any payment due under any Mortgage Loan is not paid when the same
becomes due and payable, or in the event the Mortgagor fails to perform or
observe any other covenant or obligation under the Mortgage Loan and such
failure continues beyond any applicable grace period, the Servicer will proceed
diligently to collect all payments due and shall take such action as it shall
reasonably deem to be in the best interest of the Owner. In the event that
any
payment due under any Mortgage Loan remains delinquent for a period of ninety
(90) days or more, the Servicer shall commence foreclosure proceedings in
accordance with Acceptable Servicing Procedures and the guidelines with respect
to the timelines, fees and costs set forth by Xxxxxx Xxx or Xxxxxxx Mac. In
such
connection, the Servicer shall from its own funds make all necessary and proper
Servicing Advances.
17
Section
3.3 Collection
of Mortgage Loan Payments
Continuously
from the date hereof until the principal and interest on all Mortgage Loans
being serviced hereunder are paid in full or this Agreement is otherwise
terminated, the Servicer will proceed diligently to collect all payments due
under each of such Mortgage Loans when the same shall become due and payable.
With respect to those Mortgage Loans, if any, as to which the Servicer collects
Escrow Payments, the Servicer will ascertain or estimate, as the case may be,
annual ground rents, taxes, assessments, water rates, fire and hazard insurance
premiums, mortgage insurance premiums and all other charges that, as provided
in
any Mortgage, will become due and payable so that the Escrow Payments payable
by
the Mortgagors will be sufficient to pay such charges as and when they become
due and payable. The Servicer shall not be required to institute or join in
litigation with respect to collection of any payment (whether under a Mortgage,
Mortgage Note, Primary Mortgage Insurance Policy or otherwise or against any
public or governmental authority with respect to a taking or condemnation)
if in
its reasonable judgment it believes that it will be unable to enforce the
provision of the Mortgage or other instrument pursuant to which payment is
required.
Section
3.4 Establishment
of Custodial Account; Deposits in Custodial Account
(a) The
Servicer shall segregate and hold all funds collected and received pursuant
to
the Mortgage Loans separate and apart from any of its own funds and general
assets and shall establish and maintain one or more Custodial Accounts
(collectively, "Custodial
Account"),
which
may be interest bearing, titled," IndyMac Bank, F.S.B., in trust for Xxxxxxx
Sachs Mortgage Company as Owner, and any successor Owner.” Such Custodial
Account shall be an Eligible Account.
(b) With
respect to each Mortgage Loan, the Servicer shall not later than the end of
the
second Business Day following receipt thereof, deposit in the Custodial Account
and retain therein the following payments and collections received by the
Servicer subsequent to the Cut-off Date:
(i) all
payments on account of principal, including Principal Prepayments and, except
as
otherwise expressly provided in the related Purchase Price and Terms Letter,
the
Prepayment Charges, actually collected by the Servicer on the Mortgage
Loans;
(ii) all
payments on account of interest actually collected by the Servicer on the
Mortgage Loans less the Servicing Fee;
18
(iii) all
Liquidation Proceeds;
(iv) all
Insurance Proceeds, other than Insurance Proceeds to be held in the Escrow
Account and applied to the restoration and repair of the Mortgaged Property
or
released to the Mortgagor in accordance with Acceptable Servicing
Procedures;
(v) all
Condemnation Proceeds which are not released to the Mortgagor in accordance
with
the Owner's written consent and Acceptable Servicing Procedures and Section
3.14;
(vi) any
amounts with respect to Monthly Advances required to be deposited in the
Custodial Account pursuant to Sections 4.3 and 5.3 ;
(vii) any
amount required to be deposited in the Custodial Account pursuant to Sections
3.1(c), 3.4(c), 3.10, 3.11(c), 3.13(d), (e) and (g), and 4.1(b) of this
Agreement; and
(viii) an
amount
to be deposited from the Servicer’s own funds, without reimbursement therefor,
equal to the lesser of the Prepayment Interest Shortfall Amount, if any, for
the
month preceding the month in which the applicable Remittance Date occurs and
one
half of the Servicing Fee for such Remittance Date.
(c) The
Servicer may cause the funds on deposit from time to time in the Custodial
Account to be invested in Permitted Instruments, which investments shall mature
not later than the Business Day immediately preceding the applicable Remittance
Date next following the date of such investment. All such investments shall
be
made in the name of the Servicer or its nominee. All income and gain realized
from any such investment shall be for the benefit of the Servicer and shall
be
subject to its withdrawal or order from time to time. The Servicer shall
indemnify the Owner for any and all Losses incurred in respect of any such
investment by the Servicer, and the amount of any Losses incurred in respect
of
any such investment shall be deposited in the Custodial Account by the Servicer
out if its own funds immediately, without reimbursement therefor.
(d) It
is
understood and agreed that payments in the nature of Ancillary Income need
not
be deposited by the Servicer in the Custodial Account.
Section
3.5 Permitted
Withdrawals from the Custodial Account
(a) The
Servicer may, from time to time, withdraw funds from the Custodial Account
for
the following purposes:
(i) to
make
payments and distributions to the Owner in the amounts and in the manner
provided for in Section 4.1;
(ii) to
reimburse itself for Monthly Advances made by the Servicer from its own funds
pursuant to Section 4.3, the Servicer’s right to reimburse itself pursuant to
this subclause (ii) being limited to amounts received on the related Mortgage
Loan which represent late payments of principal and/or interest respecting
which
any such Monthly Advance was made and such other amounts as are collected by
the
Servicer from the related Mortgagor or otherwise relating to the Mortgage Loan
(or to amounts received on the Mortgage Loans as a whole in the event that
such
Monthly Advance is made to pay a shortfall in a Monthly Payment made by a
Mortgagor entitled to relief under the Servicemembers Civil Relief Act).
Notwithstanding the foregoing, the Servicer may reimburse itself for Monthly
Advances from any funds in the Custodial Account if it has determined that
such
funds are Nonrecoverable Advances (as certified by the Servicer to the Owner
in
an Officer’s Certificate) (or if all funds, with respect to the related Mortgage
Loan, have previously been remitted to the Owner). Notwithstanding anything
to
the contrary contained herein, if the Servicer is Indymac and the Mortgage
Loan
for which such Advances were made was required to be repurchased by Indymac
pursuant to the Master Mortgage Loan Purchase Agreement, the Servicer shall
not
be entitled to reimburse itself for such Advances;
19
(iii) to
reimburse itself for unreimbursed Servicing Advances and any unpaid
Servicing Fees, Servicer’s right to reimburse itself pursuant to this subclause
(iii) with respect to any Mortgage Loan being limited to related proceeds from
Liquidation Proceeds, Condemnation Proceeds, Primary Mortgage Insurance Proceeds
and Other Insurance Proceeds; provided that the Servicer may reimburse itself
from any funds in the Custodial Account for (a) Servicing Advances and Servicing
Fees if all funds with respect to the related Mortgage Loan have previously
been
remitted to Owner and (b) Servicing Advances which it has determined are
Nonrecoverable Advances (as
certified by the Servicer to the Owner in an Officer’s Certificate).
Notwithstanding anything to the contrary contained herein, if the Servicer
is
Indymac and the Mortgage Loan for which such Advances were made was required
to
be repurchased by Indymac pursuant to the Master Mortgage Loan Purchase
Agreement,
the
Servicer shall not be entitled to reimburse itself for such
Advances;
(iv) to
reimburse any Master Servicer for Securitization for any unreimbursed Monthly
Advances or Servicing Advances made by such Master Servicer, as applicable,
the
right to reimbursement pursuant to this subclause (iv) with respect to any
Mortgage Loan being limited to related Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds and such other amounts as may be collected by
the
Servicer from the Mortgagor or otherwise relating to the Mortgage Loan, it
being
understood that, in the case of such reimbursement, such trustee’s right thereto
shall be prior to the rights of the Servicer to reimbursement under (ii) and
(iii), and prior to the rights of the Owner under (i);
(v) to
pay
itself any Servicing Fee and other servicing compensation not paid to the
Servicer pursuant to Section 5.3;
(vi) to
pay to
itself any interest earned on funds deposited in the Custodial
Account;
(vii) if
there
shall be amounts deposited in the Custodial Account in error, including the
Servicing Fee and other servicing compensation not required to be deposited
therein, to withdraw such amounts; and
20
(viii) to
clear
and terminate the Custodial Account upon the termination of this Agreement
in
accordance with Article 8.
Section
3.6 Establishment
of Escrow Account; Deposits in Escrow Account; Escrow Analysis
(a) The
Servicer shall segregate and hold all funds collected and received pursuant
to
the Mortgage Loans which constitute Escrow Payments separate and apart from
any
of its own funds and general assets and shall establish and maintain one or
more
Escrow Accounts (collectively, "Escrow
Account"),
which
may be interest bearing, titled, with respect to the Servicer, " IndyMac Bank,
F.S.B., in trust for Xxxxxxx Xxxxx Mortgage Company, as Owner, and any successor
Owner, and certain Mortgagors.” The Escrow Account shall be an Eligible
Account.
(b) The
Servicer shall not later than the end of the second Business Day following
receipt thereof (or sooner if required by applicable law) deposit in the Escrow
Account maintained by the Servicer and retain therein: (i) all Escrow
Payments collected on account of the Mortgage Loans for the purpose of effecting
timely payment of any such items as required under the terms of this Agreement,
and (ii) all amounts representing Insurance Proceeds or Condemnation
Proceeds which are to be applied to the restoration or repair of any Mortgaged
Property. The Servicer shall make withdrawals from the Escrow Account maintained
by the Servicer only in accordance with Section 3.7. The Servicer shall be
entitled to retain any interest earned on funds deposited in the Escrow Account
maintained by the Servicer other than interest on escrowed funds required by
law
to be paid to the Mortgagor and, to the extent required by law, the Servicer
shall pay interest on escrowed funds to the Mortgagor notwithstanding that
the
Escrow Account maintained by the Servicer may not bear interest or that the
interest earned on such escrowed funds is insufficient for such
purpose.
Section
3.7 Permitted
Withdrawals from the Escrow Account
Withdrawals
from the Escrow Account maintained by the Servicer may be made by the Servicer
only (a) to effect timely payments of taxes, assessments, water rates,
insurance premiums, fire and hazard insurance premiums or other items
constituting Escrow Payments for the related Mortgage; (b) to reimburse the
Servicer for any Servicing Advance made by the Servicer pursuant to Sections
3.8, 3.10 and 3.11 with respect to a related Mortgage Loan, the Servicer’s right
to reimburse itself pursuant to this clause (b) being limited to the amounts
as
may be collected by the Servicer from the related Mortgagor or from the related
insurer; (c) to refund to any Mortgagor any funds found to be in excess of
the amounts required under the terms of the related Mortgage Loan; (d) for
transfer to the Custodial Account in accordance with the terms of this
Agreement; (e) for application to restoration or repair of the related
Mortgaged Property in accordance with the provisions of Section 3.14,
(f) to pay to a Mortgagor, to the extent required by Applicable
Requirements, interest on the funds deposited in the Escrow Account; (g) to
pay to itself any interest earned on funds deposited in the Escrow Account
(and
not required to be paid to the related Mortgagor), (h) to remove funds
inadvertently placed in the Escrow Account by the Servicer; or (i) to clear
and
terminate the Escrow Account upon the termination of this Agreement, in
accordance with Article 8.
21
Section
3.8 Payment
of Taxes, Insurance and Other Charges
With
respect to each Mortgage Loan, the Servicer shall maintain accurate records
reflecting the status of property taxes, assessments and other charges which
are
or may become a lien upon the Mortgaged Property and the status of Primary
Mortgage Insurance Policy premiums, if any, and fire and hazard insurance
coverage and flood insurance, all as required hereunder. If a Mortgage Loan
requires Escrow Payments, the Servicer shall obtain, from time to time, all
bills for the payment of such charges (including renewal premiums) and shall
effect payment thereof prior to the applicable penalty or termination date
in a
manner consistent with Acceptable Servicing Procedures, employing for such
purpose Mortgagor deposits in the Escrow Account. The Servicer shall, with
respect to each Mortgage Loan for which Escrow Payments are maintained, conduct
an escrow analysis in accordance with industry standard procedures. If a
Mortgage Loan does not require Escrow Payments, or if there are insufficient
funds in the related Escrow Account, the Servicer shall cause all such bills
to
be paid on a timely basis and shall from its own funds, if necessary, make
a
Servicing Advance to make timely payment of all such bills. The Servicer shall
monitor the payment status of such charges (including renewal premiums) by
the
related Mortgagor, and shall effect payment thereof in a manner consistent
with
Acceptable Servicing Procedures, and in all events prior to the foreclosure
of
any lien against the Mortgaged Property resulting from non-payment of such
property taxes, assessments and other charges and prior to the termination
of
any such insurance coverage. No costs incurred by the Servicer in effecting
the
payment of taxes and assessments on the Mortgaged Properties shall, for the
purpose of calculating remittances to the Owner, be added to the amount owing
under the related Mortgage Loans, notwithstanding that the terms of such
Mortgage Loans so permit.
Section
3.9 Transfer
of Custodial Accounts and Escrow Accounts
The
Servicer may from time to time transfer the Custodial Account or the Escrow
Account maintained by it to a different depository institution, provided
that
each such account shall be and remain an Eligible Account.
Section
3.10 Maintenance
of Hazard Insurance
(a) The
Servicer shall cause to be maintained, with a Qualified Insurer for each
Mortgage Loan serviced by it, fire and hazard insurance with extended coverage
customary in the area where the Mortgaged Property is located pursuant to
insurance policies conforming to the Underwriting Guidelines, in an amount
which
is at least equal to the lesser of (a) the full insurable value of the Mortgaged
Property or (b) the greater of (i) the outstanding principal balance owing
on
the Mortgage Loan and (ii) an amount such that the proceeds of such insurance
shall be sufficient to avoid the application to the Mortgagor or loss payee
of
any coinsurance clause under the policy. If the Mortgaged Property is in an
area
then identified on a flood hazard boundary map or flood insurance rate map
issued by the Federal Emergency Management Agency as having special flood
hazards (and such flood insurance is available), the Servicer will cause to
be
maintained a flood insurance policy meeting the requirements of the current
guidelines of the Federal Insurance Administration with a generally acceptable
insurance carrier acceptable to Xxxxxx Mae or Xxxxxxx Mac. Such flood insurance
shall be in an amount representing coverage not less than the least of
(i) the outstanding principal balance of the Mortgage Loan, (ii) the
full insurable value of the improvements securing such Mortgage Loan or
(iii) the maximum amount of insurance available under the National Flood
Insurance Act of 1968 and the Flood Disaster Protection Act of 1973, each as
amended. The Servicer shall also maintain on each REO Property with an insurer
acceptable under the Underwriting Guidelines (x) fire and hazard insurance
with
extended coverage in an amount that is at least equal to the maximum insurable
value of the improvements securing the Mortgage Loan that are a part of such
property, (y) liability insurance and (z) to the extent required and available
under the National Flood Insurance Act of 1968, the Flood Disaster Protection
Act of 1973, each as amended, or other applicable federal law, flood insurance
in an amount as provided above. Any costs incurred by the Servicer maintaining
insurance under this Section 3.10 shall be recoverable as Servicing Advances.
Any amounts collected by the Servicer under any such policies shall be paid
over
or applied by the Servicer in accordance with Acceptable Servicing Procedures
for the restoration or repair of the Mortgaged Property subject to the related
Mortgage, for release to the Mortgagor in accordance with Acceptable Servicing
Procedures, or for application in reduction of the Mortgage Loan. Any such
amounts shall be deposited in the Custodial Account and subject to withdrawal
pursuant to Section 3.5. It is understood and agreed that no earthquake or
other
additional insurance is required to be maintained by the Servicer hereunder
in
connection with any Mortgage Loan or Mortgaged Property, other than pursuant
to
applicable laws and regulations that are at any time in force and require such
additional insurance. All policies required hereunder shall be endorsed with
standard mortgagee clauses with loss payable to the Servicer, and shall provide
for at least 30 days prior written notice to the Servicer of any cancellation,
reduction in amount, or material change in coverage. The Servicer shall not
interfere with the Mortgagor's freedom of choice in selecting either his
insurance carrier or agent upon any policy renewal; provided,
however,
upon
any such policy renewal, the Servicer shall not accept any such insurance
policies, unless the insurers are acceptable under the Underwriting Guidelines
and are licensed to do business in the jurisdiction in which the Mortgaged
Property is located.
22
In
the
event a hazard insurance policy shall be in danger of being terminated, or
in
the event the insurer shall cease to be acceptable
under the Underwriting Guidelines,
the
Servicer shall notify the Owner and the related Mortgagor, and shall use its
best efforts, as permitted by applicable law, to obtain from another Qualified
Insurer a replacement hazard insurance policy substantially and materially
similar in all respects to the original policy. In no event, however, shall
a
Mortgage Loan be without a hazard insurance policy at any time.
If
a
Mortgage is secured by a unit in a condominium project, the Servicer shall
verify that the coverage required of the owner's association, including hazard,
flood, liability, and fidelity coverage, is being maintained in accordance
with
then current requirements under the
Underwriting Guidelines.
Notwithstanding
anything set forth in the preceding paragraphs, the Servicer agrees to indemnify
the Owner for any Losses and related costs, judgments, and any other costs,
fees
and expenses that the Owner may sustain in any way related to the failure of
the
Mortgagor (or the Servicer) to maintain hazard insurance or flood insurance
with
respect to the related Mortgaged Property which complies with the requirements
of this section.
Section
3.11 Maintenance
of Primary Mortgage Insurance Policies; Collections Thereunder
23
(a) The
parties acknowledge that not all Mortgage Loans will be covered by Primary
Mortgage Insurance. In the event that any Mortgage Loans are or become covered
by Primary Mortgage Insurance, the provisions set forth below shall
apply.
(b) If
a
Mortgage Loan is covered by a Primary Mortgage Insurance Policy as of the
Cut-off Date, or if a Mortgage Loan becomes covered by a Primary Mortgage
Insurance Policy pursuant to subsection 3.11(c) below, the Servicer shall,
without any cost to the Owner, cause the premium for each such Primary Mortgage
Insurance Policy, beginning with the premium due after the Cut-off Date in
the
case of any Mortgage Loan covered by a Primary Insurance Policy prior to the
Cut-off Date, to be paid on a timely basis and shall from its own funds, if
necessary, make a Servicing Advance to pay the premium on a timely basis. The
Servicer will not cancel or refuse to renew any such Primary Mortgage Insurance
Policy that is required to be kept in force under any Mortgage and pursuant
to
this subsection, or pursuant to subsection 3.11(c) below, unless a replacement
Primary Mortgage Insurance Policy for such canceled or non renewed policy is
obtained from and maintained with an insurer that satisfies the standards set
forth in this subsection. If the insurer shall cease to be a Qualified Insurer,
the Servicer shall obtain from another qualified insurer a replacement Primary
Mortgage Insurance Policy. The Servicer shall not take any action or fail to
take any action that would result in non-coverage under any applicable Primary
Mortgage Insurance Policy of any loss which, but for the actions of the
Servicer, would have been covered thereunder. In connection with any assumption
or substitution agreement entered into or to be entered into pursuant to Section
4.1, the Servicer shall promptly notify the insurer under the related Primary
Mortgage Insurance Policy, if any, of such assumption or substitution of
liability in accordance with the terms of such policy and shall take all actions
which may be required by such insurer as a condition to the continuation of
coverage under such Primary Mortgage Insurance Policy. If such Primary Mortgage
Insurance Policy is terminated as a result of such assumption or substitution
of
liability, the Servicer shall obtain a replacement Primary Mortgage Insurance
Policy as provided above.
(c) As
part
of its activities as servicer of the Mortgage Loans, the Servicer agrees to
prepare and present, on behalf of itself and the Owner, claims under any Primary
Mortgage Insurance Policy in a timely fashion in accordance with the terms
thereof and, in this regard, to take such reasonable action as shall be
necessary to permit recovery under any Primary Mortgage Insurance Policy
respecting a defaulted Mortgage Loan. Pursuant to Section 3.4, any amounts
collected by the Servicer under any Primary Mortgage Insurance Policy shall
be
deposited in the Custodial Account, subject to withdrawal pursuant to Section
3.5, and remitted to the Owner on the appropriate Remittance Date.
Section
3.12 Fidelity
Bond; Errors and Omissions Insurance
The
Servicer shall maintain, at its own expense, with responsible companies that
meet the requirements of Xxxxxx Mae or Xxxxxxx Mac, a blanket fidelity bond
and
an errors and omissions insurance policy, with broad coverage on all officers,
employees, agents and other persons acting in any capacity requiring such
persons to handle funds, money, documents or papers relating to the Mortgage
Loans (collectively, the "Servicer
Employees").
Any
such fidelity bond and errors and omissions insurance shall be in the form
of
the Mortgage Banker's Blanket Bond and shall protect and insure the Servicer
against losses from forgery, theft, embezzlement, fraud, errors, omissions,
failure to maintain any insurance policies required pursuant to this Agreement,
and dishonest or negligent acts of such Servicer Employees, any employees of
outside firms that provide data processing services for the Servicer, and
temporary contract employees or student interns. Such fidelity bond shall also
protect and insure the Servicer against losses in connection with the release
or
satisfaction of a Mortgage Loan without having obtained payment in full of
the
indebtedness secured thereby and such fidelity bond and errors and omissions
insurance policy shall in no event be terminated or materially modified without
30 days prior written notice to the Owner. No provision of this Section 3.12
requiring such fidelity bond and errors and omissions insurance shall diminish
or relieve the Servicer from its duties and obligations as set forth in this
Agreement. The terms of any such fidelity bond and errors and omissions
insurance policy shall be at least equal to the corresponding amounts required
by Xxxxxx Mae in the Xxxxxx Xxx Selling and Servicing Guide, or by Xxxxxxx
Mac
in the Xxxxxxx Mac Seller’s and Servicer’s Guide, as amended or restated from
time to time. Upon the request of the Owner, the Servicer shall cause to be
delivered to the Owner a certificate of insurance with respect to such fidelity
bond and errors and omissions insurance policy.
24
Section
3.13 Title,
Management and Disposition of Real Estate Owned
(a) The
Servicer shall notify the Owner of its intention to institute any foreclosure
proceeding no fewer than ten (10) days prior to initiating such proceeding.
The
Servicer shall notify the Owner of its intention to accept a deed-in-lieu of
foreclosure or a partial release of any of the Mortgaged Property subject to
the
lien of the Mortgage no fewer than ten (10) days prior to accepting such
deed-in-lieu or partial release and shall only accept such deed-in-lieu or
grant
such partial release if the Owner has not objected before the end of the tenth
day after delivery of such notice. In connection with any foreclosure sale,
the
Servicer shall consult with the Owner with regard to a bid price for the related
Mortgaged Property. The Servicer shall make all required Servicing Advances
and
shall service and administer the Mortgage Loans in accordance with all
applicable laws, rules and regulations and shall provide to the Mortgagors
any
reports required to be provided to them thereby. The Owner shall furnish to
the
Servicer any powers of attorney and other documents reasonably necessary or
appropriate to enable the Servicer to carry out its servicing and administrative
duties under this Agreement.
(b) In
the
event that title to any Mortgaged Property is acquired in foreclosure or by
deed
in lieu of foreclosure ("REO
Property"),
the
deed or certificate of sale shall be taken in the name of the Servicer for
the
benefit of the Owner or,
in
the event the Owner is not authorized or permitted to hold title to real
property in the state where the REO Property is located, or would be adversely
affected under the "doing business" or tax laws of such state by so holding
title, the deed or certificate of sale shall be taken in the name of such Person
or Persons as shall be consistent with an Opinion of Counsel obtained by the
Servicer from any attorney duly licensed to practice law in the state where
the
REO Property is located. The Person or Persons holding such title other than
the
Owner shall acknowledge in writing that such title is being held as nominee
for
the Owner.
(c) The
Servicer shall manage, conserve, protect, and operate each REO Property solely
for the purpose of its prompt disposition and sale. The Servicer shall either
itself or through an agent selected by the Servicer, manage, conserve, protect,
and operate the REO Property in accordance with Acceptable Servicing Procedures.
The Servicer shall attempt to sell the same (and may temporarily rent the same
for a period not greater than one year) on such terms and conditions as the
Servicer deems to be in the best interest of the Owner.
25
The
Servicer shall use its best efforts to dispose of the REO Property as soon
as
possible and shall sell such REO Property in any event within three years after
title has been taken to such REO Property, not later than the end of the third
taxable year after the year of its acquisition unless (i) (A) a REMIC election
has not been made with respect to the arrangement under which the Mortgage
Loans
and the REO Property are held, and (ii) the Servicer determines, and gives
an
appropriate notice to the Owner to such effect, that a longer period is
necessary for the orderly liquidation of such REO Property. If a period longer
than three years is permitted under the foregoing sentence and is necessary
to
sell any REO Property, (i) the Servicer shall report monthly to the Owner as
to
the progress being made in selling such REO Property and (ii) if, with the
written consent of the Owner, a purchase money mortgage is taken in connection
with such sale, such purchase money mortgage shall name the Servicer as
mortgagee, and such purchase money mortgage shall not be held pursuant to this
Agreement, but instead a separate participation agreement among the Servicer
and
Owner shall be entered into with respect to such purchase money mortgage.
Notwithstanding
anything to the contrary contained in this Section 3.13, in connection with
a
foreclosure or acceptance of a deed in lieu of foreclosure, in the event the
Servicer has reasonable cause to believe that a Mortgaged Property is
contaminated by hazardous or toxic substances or wastes, or if the Owner
otherwise requests, an environmental inspection or review of such Mortgaged
Property to be conducted by a qualified inspector shall be arranged by the
Servicer. Upon completion of the inspection, the Servicer shall provide the
Owner with a written report of such environmental inspection. In the event
that
the environmental inspection report indicates that the Mortgaged Property is
contaminated by hazardous or toxic substances or wastes, the Servicer shall
not
proceed with foreclosure or acceptance of a deed in lieu of foreclosure. In
the
event that the environmental inspection report is inconclusive as to the whether
or not the Mortgaged Property is contaminated by hazardous or toxic substances
or wastes, the Servicer shall not, without the prior approval of the Owner,
proceed with foreclosure or acceptance of a deed in lieu of foreclosure. In
the
event the Owner or its designee directs the Servicer not to proceed with
foreclosure or acceptance of a deed in lieu of foreclosure, the Servicer shall
be reimbursed for all customary, reasonable, and necessary “out of pocket” costs
and expenses that are incurred by the Servicer with respect to the related
Mortgaged Property from the Custodial Account, as though such costs were
Servicing Advances, pursuant to Section 3.4 hereof.
(d) The
Servicer shall hold all funds collected and received in connection with the
operation of REO Property separate and apart from its own funds or general
assets, in the Custodial Account.
(e) The
Servicer shall deposit, or cause to be deposited not later than the end of
the
second Business Day following receipt thereof in the Custodial Account
maintained by it all revenues received with respect to the conservation and
disposition of any REO Property for distribution to the Owner pursuant to the
provisions of Section 4.1.
(f) [RESERVED]
26
(g) [RESERVED]
(h) The
Servicer shall withdraw the Custodial Account funds necessary for the proper
operation management and maintenance of the REO Property, including the cost
of
maintaining any hazard insurance pursuant to Section 3.10 and the fees of any
managing agent of the Servicer, or the Servicer itself. The Servicer shall
make
monthly distributions on each Remittance Date to the Owner of the net cash
flow
from the REO Property (which shall equal the revenues from such REO Property
net
of the expenses described above and of any reserves reasonably required from
time to time to be maintained to satisfy anticipated liabilities for such
expenses).
Section
3.14 Application
of Proceeds of Insurance to Repair or Restoration
The
Servicer shall collect the proceeds from all policies of insurance required
to
be maintained pursuant to Section 3.10 with respect to all losses that may
occur. The Servicer may remit such proceeds to the Mortgagor toward the
restoration or repair of the related property in a manner, and shall otherwise
take such actions in connection with such restoration and repair, as shall
be
consistent with Acceptable Servicing Procedures.
The
Servicer need not obtain the approval of the Owner prior to releasing any
Insurance Proceeds or Condemnation Proceeds to the Mortgagor to be applied
to
the restoration or repair of the Mortgaged Property if such release is in
accordance with Acceptable Servicing Practices. At a minimum the Servicer shall
comply with the following conditions in connection with any such release of
Insurance Proceeds or Condemnation Proceeds:
The
Servicer shall receive satisfactory independent verification of completion
of
repairs and issuance of any required approvals with respect
thereto;
(1) the
Servicer shall take all steps necessary to preserve the priority of the lien
of
the Mortgage, including, but not limited to requiring waivers with respect
to
mechanics' and materialmen's liens;
(2) the
Servicer shall verify that the Mortgage Loan is not in default; and
(3) pending
repairs or restoration, the Servicer shall place the Insurance Proceeds or
Condemnation Proceeds in the Escrow Account.
If
the
Owner is named as an additional loss payee, the Servicer is hereby empowered
to
endorse any loss draft issued in respect of such a claim in the name of the
Owner.
Section
3.15 Inspections
The
Servicer or its authorized representative shall conduct inspections of Mortgaged
Properties at such times and in a manner consistent with Acceptable Servicing
Procedures. For any Mortgage Loan that is not insured by a Primary Mortgage
Insurance Policy, in the event such Mortgage Loan becomes 45 days delinquent,
(a) the Servicer shall inspect the related Mortgage Property as promptly as
practicable after the 45th day of delinquency, (b) the Servicer may perform
an
inspection at such other times and at such intervals as the Servicer deems
appropriate and (c) the Servicer shall immediately perform an inspection upon
any abandonment of the related Mortgaged Property. For any Mortgage Loan that
is
insured by a Primary Mortgage Insurance Policy, the Servicer shall inspect
the
related Mortgaged Property as directed by the related Primary Insurer; provided,
however, that, at a minimum, in the event the Mortgage Loan becomes 60 days
delinquent, the Servicer shall inspect the related Mortgaged Property prior
to
the 90th day of delinquency. The Servicer shall keep a written report of each
such inspection and shall provide a copy of such report to the Owner upon the
request of the Owner.
27
Section
3.16 Fair
Credit Reporting Act.
The
Servicer, in its capacity as servicer for each Mortgage Loan, agrees to fully
furnish, in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (e.g., favorable and unfavorable)
on its borrower credit files to Equifax, Experian and Trans Union Credit
Information Company (three of the credit repositories), on a monthly
basis.
Section
3.17 Compliance
with the Privacy Laws
The
Servicer shall comply with all provisions of the Privacy Laws relating to the
Mortgage Loans, the related borrowers and any "nonpublic personal information"
(as defined in the Privacy Laws) received by the Servicer incidental to the
performance of its obligations under this Agreement, including, maintaining
adequate information security procedures to protect such nonpublic personal
information and providing all privacy notices required by the Privacy
Laws.
ARTICLE
IV
PAYMENTS
TO THE OWNER
Section
4.1 Distributions
(a) On
each
Remittance Date the Servicer shall remit to the Owner (a) all amounts credited
to the Custodial Account as of the close of business on the preceding
Determination Date, net of charges or withdrawals from the Custodial Account
pursuant to Section 3.5, plus (b) all Monthly Advances, if any, that the
Servicer is obligated to distribute pursuant to Section 4.3; minus (c) any
amounts attributable to Principal Prepayments received after the related
Prepayment Period; minus (d) any amounts attributable to Monthly Payments
collected but due on a Due Date or Dates subsequent to the preceding
Determination Date. It is understood that by operation of Section 3.4, the
remittance on the first Remittance Date with respect to a Mortgage Loan Package
is to include principal collected after the Cut-off Date through the preceding
Determination Date plus interest, adjusted to the Mortgage Loan Remittance
Rate,
collected through such Determination Date exclusive of any portion thereof
allocable to the period of time prior to the Cut-off Date, with the adjustments
specified in (b), (c) and (d) above. Each such remittance shall be made by
wire
or other electronic funds transfer of immediately available funds to the account
of the Owner according to the written wire instructions provided by the Owner
to
the Servicer from time to time.
28
(b) With
respect to any remittance to the Owner made by the Servicer after the second
Business Day following the Business Day on which such remittance was due, the
Servicer shall pay to the Owner interest on such late remittance at an annual
rate equal to Prime plus two percent (2.0%), but in no event greater than the
maximum amount permitted by applicable law. Such interest shall be deposited
in
the Custodial Account by the Servicer on the date such late remittance is made
and shall cover the period commencing with the date on which such remittance
was
due and ending with the Business Day on which such late remittance is made,
both
inclusive. Such interest shall be remitted along with such late remittance.
The
payment by the Servicer of any such interest shall not be deemed an extension
of
time for payment or a waiver of any Event of Default by the
Servicer.
Section
4.2 Reports
(a) Not
later
than each Remittance Advice Date, the Servicer shall furnish to the Owner via
any electronic medium a monthly report in a form reasonable acceptable to
institutional buyers of mortgage loans, which report shall include, without
limitation, with respect to each Mortgage Loan the following loan-level
information: (i) the balance due as of the last day of the related Due Period,
(ii) all Principal Prepayments applied to the Mortgagor’s account during the
related Prepayment Period, (iii) the amount of the remittance made on such
Remittance Date which is allocable to principal and allocable to interest;
(iv)
the amount of servicing compensation received by the Servicer during the prior
calendar month and (v) the delinquency and bankruptcy status of the Mortgage
Loan, if applicable.
(b) With
respect to any REO Property, and upon the request of the Owner, the Servicer
shall furnish to the Owner a statement describing the Servicer’s efforts during
the previous month in connection with the sale of such REO Property, including
any rental of such REO Property incidental to the sale thereof and an operating
statement. The Servicer shall also provide the Owner with such information
concerning the Mortgage Loans as is necessary for Owner to prepare its federal
income tax return and as the Owner may reasonably request from time to time.
The
Owner agrees to pay for all reasonable out-of-pocket expenses incurred by the
Servicer in connection with complying with any request made by the Owner
hereunder if such information is not customarily provided by the Servicer in
the
ordinary course of servicing mortgage loans similar to the Mortgage
Loans.
Section
4.3 Monthly
Advances by Servicer
On
the
Determination Date, the Servicer shall deposit in the Custodial Account from
its
own funds or from amounts held for future distribution an amount equal to all
Monthly Payments to the extent not allocable to the period prior to the Cut-off
Date (with interest adjusted to the Mortgage Loan Remittance Rate) which were
due on the Mortgage Loans during the applicable Due Period and which were
delinquent as of the close of business on the Business Day prior to the related
Determination Date or which were deferred pursuant to Section 3.1(c). Any
amounts held for future distribution and so used shall be replaced by the
Servicer by deposit in the Custodial Account on or before any future Remittance
Date if funds in the Custodial Account on such Remittance Date shall be less
than payments to the Owner required to be made on such Remittance Date. The
Servicer's obligation to make such Monthly Advances as to any Mortgage Loan
will
continue through the last Monthly Payment due prior to the payment in full
of
the Mortgage Loan, or of the last Remittance Date prior to the Remittance Date
for the distribution of all Liquidation Proceeds and other payments or
recoveries (including Insurance Proceeds and Condemnation Proceeds) with respect
to the Mortgage Loan; provided,
however,
that
such obligation shall cease if the Servicer determines, in its sole reasonable
opinion, that advances with respect to such Mortgage Loan are non-recoverable
by
the Servicer from Liquidation Proceeds, Insurance Proceeds, Condemnation
Proceeds, or otherwise with respect to a particular Mortgage Loan. In the event
that the Servicer determines that any such advances are non-recoverable, the
Servicer shall provide the Owner with a certificate signed by two officers
of
the Servicer evidencing such determination.
29
ARTICLE
V
GENERAL
SERVICING PROCEDURE; COVENANTS;
REPRESENTATIONS
AND WARRANTIES
Section
5.1 Assumption
Agreements
(a) The
Servicer will use its best efforts to enforce any "due-on-sale" provision
contained in any Mortgage or Mortgage Note and to deny assumption by the person
to whom the Mortgaged Property has been or is about to be sold, whether by
absolute conveyance or by contract of sale, and whether or not the Mortgagor
remains liable on the Mortgage and the Mortgage Note, provided
that in
accordance with the terms of the Mortgage Note, the Servicer may permit an
assumption if but only if the Servicer approves the creditworthiness of the
assuming party in accordance with the Underwriting Guidelines. When the
Mortgaged Property has been conveyed by the Mortgagor, the Servicer will, to
the
extent it has knowledge of such conveyance, exercise its rights to accelerate
the maturity of such Mortgage Loan under the "due-on-sale" clause applicable
thereto; provided,
however,
the
Servicer will not exercise such rights if prohibited by Applicable Requirements
from doing so or if the exercise of such rights would impair or threaten to
impair any recovery under the related Primary Mortgage Insurance Policy, if
any.
If the Servicer reasonably believes it is unable under Applicable Requirements
to enforce such "due-on-sale" clause, the Servicer (unless otherwise required
by
law and in any event will notify the Owner of such requirement) will request
the
written permission of the Primary Mortgage Insurer, if required to cause the
coverage under the Primary Mortgage Insurance Policy to remain in full force
and
effect, and the Owner prior to entering into an assumption and modification
agreement with the person to whom such property has been conveyed, pursuant
to
which such person becomes liable under the Mortgage Note and, to the extent
permitted by Applicable Requirements, the Mortgagor remains liable thereon.
In
connection with any such assumption, the related Mortgage Interest Rate, the
Unpaid Principal Balance, the Lifetime Rate Cap (if applicable), the Gross
Margin (if applicable), the Initial Rate Cap (if applicable) or the Periodic
Rate Cap (if applicable) of the related Mortgage Note and the term of the
Mortgage Loan may not be changed. If an assumption is allowed pursuant to this
Section 5.1(a), the Servicer, with the prior consent of the Primary Mortgage
Insurer, if any, is authorized to enter into a substitution of liability
agreement with the purchaser of the Mortgaged Property pursuant to which the
original Mortgagor is released from liability and the purchaser of the Mortgaged
Property is substituted as Mortgagor and becomes liable under the Mortgage
Note.
Any such substitution of liability agreement shall be in lieu of an assumption
agreement.
30
(b) The
Servicer shall follow Acceptable Servicing Procedures (including underwriting
standards) with respect to any such assumption or substitution of liability.
The
Servicer shall notify the Owner that any such substitution of liability or
assumption agreement has been completed by forwarding to the Owner or its
designee the original of any such substitution of liability or assumption
agreement, which document shall be added to the related Collateral File and
shall, for all purposes, be considered a part of such Collateral File to the
same extent as all other documents and instruments constituting a part
thereof.
(c) For
purposes of this Section 5.1, the term "assumption" is deemed to also include
a
sale of the Mortgaged Property subject to the Mortgage that is not accompanied
by an assumption or substitution of liability agreement.
Section
5.2 Satisfaction
of Mortgages and Release of Collateral Files
(a) Upon
the
payment in full of any Mortgage Loan, or the receipt by the Servicer of a
notification that payment in full will be escrowed in a manner customary for
such purposes, the Servicer (i) shall prepare
the appropriate documents and instruments required to satisfy or release the
lien of the Mortgage in accordance with applicable state law requirements,
(ii)
shall promptly and within the time periods appropriate to process the
satisfaction or release within the applicable legal deadlines notify
the Owner of such event and (iii) shall request that the Owner deliver the
required portion of the Collateral File to the Servicer. The Owner shall, within
five (5) Business Days following its receipt of any such certification and
request, send to the Servicer the requested portion of the Collateral File.
Upon
receipt of such package, the Servicer shall prepare and execute the documents
and instruments necessary to satisfy or release the lien of the Mortgage and
shall process
such satisfaction or release in accordance with applicable state law
requirements. In addition, if, with respect to any Mortgage Loan that has been
paid in full, the Owner has recorded or caused to be recorded in the appropriate
public recording office of the jurisdiction in which the related Mortgaged
Property is located the related Assignment of Mortgage which designates the
Owner as the holder of record of the Mortgage,
the
Servicer shall prepare and deliver to the Owner, together with a request for
execution, the documents and instruments necessary to satisfy or release the
lien of the Mortgage. The Owner shall, within five (5) Business Days following
its receipt of any such request, send to the Servicer the fully-executed
documents that were prepared and requested by the Servicer. Upon receipt of
such
package, the Servicer shall process
such satisfaction or release in accordance with applicable state law
requirements. In the event that applicable state law requires that a
satisfaction or release be recorded within a shorter time period than the
processes set forth above permits, the Servicer shall advise the Owner
accordingly and shall use reasonable efforts to ensure that the lien of the
Mortgage is released or satisfied in accordance with applicable state law
requirements. The Owner shall assist therewith by returning to the Servicer
the
required portion of the Collateral File (and, if applicable, the executed
satisfaction and release documents and instruments) within the time periods
specified by the Servicer. The
Servicer shall not be liable for and the Owner shall indemnify the Servicer
against any third party liability for failure to release the lien of a Mortgage
as required under applicable law to the extent that such failure was caused
by
the Owner’s breach of its obligations under this Section 5.2.
31
(b) If
the
Servicer satisfies or releases a Mortgage without first having obtained payment
in full of the indebtedness secured by the Mortgage or should the Servicer
otherwise prejudice any rights the Owner may have under the mortgage
instruments, upon written demand of the Owner, the Servicer shall remit to
the
Owner the then unpaid principal balance of the related Mortgage Loan. The
Servicer shall maintain the fidelity bond and errors and omissions insurance
policy as provided for in Section 3.12 insuring the Servicer against any loss
it
may sustain with respect to any Mortgage Loan not satisfied in accordance with
the procedures set forth herein.
Section
5.3 Servicing
Compensation
As
compensation for its services hereunder, the Servicer shall be entitled to
pay
itself the Servicing Fee with respect to each Mortgage Loan from the gross
amount of interest payments on such Mortgage Loan which are actually received
by
the Servicer with respect thereto. Additional servicing compensation in the
form
of all Ancillary Income which are actually received by the Servicer may be
retained by the Servicer to the extent not required to be deposited into the
Custodial Account pursuant to the terms of this Agreement. The Servicer shall
be
required to pay all expenses incurred by it in connection with its servicing
activities hereunder and shall not be entitled to reimbursement therefor except
as specifically provided for in this Agreement.
Section
5.4 Annual
Statements as to Compliance
(a) The
Servicer shall deliver to the Owner, to any master servicer and/or trustee
which
is master servicing or acting as trustee with respect to any of the Mortgage
Loans pursuant to a Securitization (each, a “Master
Servicer”)
and to
the Sarbanes Certifying Party not later than the earlier of (a) March 15 of
each
calendar year (other than the calendar year during which the related Closing
Date occurs) or (b) with respect to any calendar year during which the annual
report of the entity which is the Depositor (or other party responsible for
filing Form 10-K with the Commission (as defined below)) of the Mortgage Loans
pursuant to a Securitization or other securitization transaction on Form 10-K
is
required to be filed in accordance with the Exchange Act, and the rules and
regulations of the Commission, 15 calendar days before the date on which the
Depositor’s annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Commission (or,
in
each case, if such day is not a Business Day, the immediately preceding Business
Day), an Officer’s Certificate stating, as to each signatory thereof, that (i) a
review of the activities of the Servicer during the preceding fiscal year and
of
performance under this Agreement has been made under such officer’s supervision
(ii) based on such review, the Servicer has fulfilled all of its
obligations under this Agreement throughout such fiscal year, or, if there
has
been a default in the fulfillment of any such obligation, specifying each such
default known to such officer and the nature and status thereof and the actions
being taken by the Servicer to cure such default, and (iii) all reports
and
information provided to the Owner by the Servicer, pursuant to the Servicer’s
reporting requirements under the Agreement, are accurate and complete in all
material respects. Copies of such statement may be provided by the Owner to
any
Person identified as a prospective purchaser of the Mortgage Loans.
32
(b) With
respect to any Mortgage Loans that are subject to a Securitization, not later
than the earlier of (a) March 15 of each calendar year (other than the calendar
year during which the Closing Date occurs) or (b) with respect to any calendar
year during which the Depositor’s annual report on Form 10-K is required to be
filed in accordance with the Exchange Act and the rules and regulations of
the
Commission, 15 calendar days before the date on which the Depositor’s annual
report on Form 10-K is required to be filed in accordance with the Exchange
Act
and the rules and regulations of the Commission (or, in each case, if such
day
is not a Business Day, the immediately preceding Business Day), an officer
of
the Servicer shall execute and deliver an Officer’s Certificate in the form
attached hereto as Exhibit D to the Sarbanes Certifying Party for the benefit
of
the Master Servicer, the Sarbanes Certifying Party and their respective
officers, directors and affiliates.
(c) The
Servicer shall indemnify and hold harmless the Master Servicer and the Sarbanes
Certifying Party (any such person, an “Indemnified
Party”)
from
and against any Losses and related costs, judgments and other costs and expenses
arising out of or based upon a breach by the Servicer of its obligations under
this Section 5.4 or Section 5.5, or any material misstatement or omission,
negligence, bad faith or willful misconduct of the Servicer in connection
therewith. If the indemnification provided for herein is unavailable or
insufficient to hold harmless any Indemnified Party, then the Servicer agrees
that it shall contribute to the amount paid or payable by the Indemnified Party
as a result of the Losses of the Indemnified Party in such proportion as is
appropriate to reflect the relative fault of the Indemnified Party on the one
hand and the Servicer on the other in connection with a breach of the Servicer’s
obligations under this Section 5.4 or Section 5.5, or the Servicer’s material
misstatement or omission, negligence, bad faith or willful misconduct in
connection therewith.
(d) It
is
acknowledged and agreed that each Master Servicer and the Sarbanes Certifying
Party shall be an express third party beneficiary of the provisions of this
Section 5.4 and shall be entitled independently to enforce the provisions of
this Section 5.4 with respect to any obligations owed to such entity as if
it
were a direct party to this Agreement.
Section
5.5 Annual
Independent Public Accountants' Servicing Report
Not
later
than the earlier of (a) March 15 of each calendar year (other than the calendar
year during which the related Closing Date occurs) or (b) with respect to any
calendar year during which the Depositor’s annual report on Form 10-K is
required to be filed in accordance with the Exchange Act and the rules and
regulations of the Commission, 15 calendar days before the date on which the
Depositor’s annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Commission (or,
in
each case, if such day is not a Business Day, the immediately preceding Business
Day), the Servicer at its expense shall cause a firm of independent public
accountants which is a member of the American Institute of Certified Public
Accountants to furnish a statement to the Owner, any Master Servicer and the
Sarbanes Certifying Party to the effect that such firm has examined certain
documents and records and performed certain other procedures relating to the
servicing of the Mortgage Loans during the immediately preceding calendar year
of the Servicer and that such firm is of the opinion that, on the basis of
such
examination conducted substantially in compliance with the Uniform Single
Attestation Program for Mortgage Bankers, such servicing has been conducted
in
compliance therewith, except for such exceptions as shall be set forth in
such statement.
33
Section
5.6 Owner's
Right to Examine Servicer Records, etc.
The
Owner
shall have the right, at the Owner's expense, except for immaterial items in
the
ordinary course of business, to examine and audit the Servicer's books of
account, records, reports, and other papers relating to (i) the performance
by
the Servicer of its obligations and duties under this Agreement, or (ii) the
Mortgage Loans, to make copies and extracts therefrom, and to discuss the
affairs, finances, and accounts of such Servicer relating to such performance
with its officers and employees, all at such reasonable times and places and
as
often as may be reasonably requested.
Section
5.7 Consents
and Approvals
The
Owner
shall timely obtain, at its sole cost and expense, the consents and approvals
required by law or pursuant to contract to consummate the transactions
contemplated hereby. All such consents will be obtained without any cost
or expense to the Servicer and will be obtained without any adverse modification
in the terms of any of the agreements relating to the Mortgage Loans or the
imposition of any burdensome provisions or conditions on the
Servicer.
Furthermore,
the Servicer shall provide to the Owner, and for any Owner insured by FDIC
or
NAIC, the supervisory agents and examiners of FDIC and OTS or NAIC, access
to
any documentation regarding the Mortgage Loans which may be required by
applicable regulations. Such access shall be afforded without charge, but only
upon reasonable request, during normal business hours and at the offices of
the
Servicer.
In
addition, the Servicer shall furnish upon request by the Owner, during the
term
of this Agreement, such periodic, special or other reports or information,
whether or not provided for herein, as shall be necessary, reasonable and
appropriate with respect to the purposes of this Agreement and applicable
regulations. All such reports or information shall be provided by and in
accordance with all reasonable instructions and directions the Owner may
require, provided that the Owner shall pay the Servicer’s reasonable fees and
expenses in connection with providing such reports or information. The Servicer
agrees to execute and deliver all such instruments and take all such action
as
the Owner, from time to time, may reasonably request in order to effectuate
the
purposes and to carry out the terms of this Agreement.
Section
5.8 Removal
of Mortgage Loans from Inclusion Under this Agreement Upon a Whole Loan Transfer
or a Securitization Transaction on One or More Reconstitution
Dates
(a) The
Servicer and the Owner agree that with respect to some or all of the Mortgage
Loans, the Owner may effect one or more Whole Loan Transfers and/or one or
more
Securitization Transactions. In connection with a Whole Loan Transfer, the
related Reconstitution Agreement shall provide that no more than four (4)
Persons shall have the status of "Owner" thereunder.
34
(b) With
respect to each Whole Loan Transfer or Securitization Transaction, as the case
may be, entered into by Owner, Servicer agrees:
(i) negotiate
in good faith and execute a servicer agreement reasonably required to effectuate
the Whole Loan Transfer or the Securitization Transaction, as the case may
be,
provided such agreement creates no greater obligation or cost on the part of
the
Servicer than otherwise set forth in this Agreement, and provided further that
the Servicer shall be entitled to a servicing fee under that agreement at a
rate
per annum no less than the Servicing Fee Rate;
(ii) to
cooperate fully with the Owner and any prospective the Owner with respect to
all
reasonable requests that are necessary to effect a Securitization Transaction
or
Whole Loan Transfer;
(iii) provide
as applicable:
(A) information
pertaining to the Servicer of the type and scope customarily included in
offering documents for residential mortgage-backed securities transactions
involving multiple loan originators; and
(B) such
opinions of counsel, letters from auditors, and certificates of public officials
or officers of the Servicer as are reasonably believed necessary by the trustee,
any rating agency or the Owner, as the case may be, in connection with such
Securitization Transaction. The Owner shall pay all third party costs associated
with the preparation of the information described in clause (ii)(A) above and
the delivery of any opinions, letters or certificates described in this clause
(ii)(B). The Servicer shall not be required to execute any servicer agreement
unless a draft of the agreement is provided to the Servicer at least 10 days
before the Reconstitution Date, or such longer period as may reasonably be
required for the Servicer and its counsel to review and comment on the
agreement;
(c) In
connection with any Securitization Transaction, the Servicer, upon request,
will
bring down the representations and warranties made in Section 2.1 in to a date
no later than the related Reconstitution Date;
(d) In
connection with any Securitization Transaction, the Servicer shall indemnify,
defend and hold harmless the Owner, the Depositor, and their respective
affiliates, directors, officers and employees from and against any and all
Losses to which any such Person may be subject to as a result of any untrue
statement of any material fact contained in any information (such information,
the “Indymac Information”) prepared and furnished to the Owner or the Depositor,
by the Servicer for inclusion in any related offering document or prospectus
(collectively, “Offering
Materials”),
or
arise out of, or are based upon, any omission in the Indymac Information
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and will reimburse to all such parties,
as
applicable, for damages or expenses reasonably incurred by it, as they are
incurred; provided, however, that the Servicer shall be liable only insofar
as
such untrue statement or omission relates solely to the Indymac Information
in
the Offering Materials furnished to any such party by the Servicer specifically
for inclusion in the Prospectus Supplement; and
35
(e) All
Mortgage Loans not sold or transferred pursuant to Securitization Transactions
shall remain subject to this Agreement and shall continue to be serviced in
accordance with the terms of this Agreement and with respect thereto this
Agreement shall remain in full force and effect.
Section
5.9 Compliance
With REMIC Provisions
If
a
REMIC election has been made with respect to the arrangement under which the
Mortgage Loans and REO Property are held or transferred, the Servicer shall
not
take any action, cause the REMIC to take any action or fail to take (or fail
to
cause to be taken) any action that, under the REMIC Provisions, if taken or
not
taken, as the case may be, could (i) endanger the status of the REMIC as a
REMIC
or (ii) result in the imposition of a tax upon the REMIC (including but not
limited to the tax on “prohibited transactions” as defined in Section 860(a)(2)
of the Code and the tax on “contributions” to a REMIC set forth in Section
860(d) of the Code) unless the Servicer has received an Opinion of Counsel
(at
the expense of the party seeking to take such action) to the effect that the
contemplated action will not endanger such REMIC status or result in the
imposition of any such tax.
36
ARTICLE
VI
THE
SERVICER
Section
6.1 Indemnification;
Third Party Claims
Subject
to Section 6.3, the Servicer agrees to indemnify and hold harmless the Owner
against any and all Losses that the Owner may sustain in any way related to
the
failure of such Servicer to service the Mortgage Loans in compliance with the
terms of this Agreement; provided,
however,
the
Servicer shall not be liable hereunder (a) to the extent such Losses directly
result from the Custodian's negligent action, negligent failure to act, bad
faith, willful misconduct or breach under the Custodial Agreement, dated as
of
February 1, 2004, among the Owner, Indymac and the Custodian,(b) with respect
to
any action or inaction in accordance with the direction or consent of the Owner
or (c) resulting from the Owner's failure to respond to a request by the
Servicer for direction or consent in accordance with Section 3.1(c) hereof.
The Servicer shall immediately notify the Owner if a claim is made by a third
party with respect to this Agreement or the Mortgage Loans. The Servicer shall
assume (with the written notification to the Owner) the defense of any such
claim and pay all reasonable expenses in connection therewith, including counsel
fees, and promptly pay, discharge and satisfy any judgment or decree which
may
be entered against the Servicer or the Owner, subject to limitation pursuant
to
this Section 6.1, in respect of such claim. The Servicer shall follow any
written instructions received from the Owner in connection with any such claim
and the Owner shall promptly reimburse the Servicer for all amounts reasonably
advanced by it pursuant to the preceding sentence, except when the claim (a)
is
related to the Servicer’s obligations to indemnify the Owner pursuant hereto,
(b) results from the failure of the Servicer to service the Mortgage Loans
in compliance with the terms of this Agreement or (c) results from the
Servicer's willful misconduct, bad faith or negligence in performing its duties
under this Agreement.
With
respect to any Mortgage Loan, in the event that the Owner records or causes
to
be recorded in the appropriate public recording office of the jurisdiction
in
which the related Mortgaged Property is located the related Assignment of
Mortgage which designates the Owner as the holder of record of the Mortgage,
the
Owner shall comply with the provisions of Section 5.2(a) regarding the execution
and delivery of release and reconveyance documents, and shall immediately
complete, sign and return to the Servicer any additional documents that may
be
required of the holder of record of the Mortgage and may be reasonably requested
by the Servicer in order to permit the Servicer to comply with the Servicer’s
servicing obligations, and, in its capacity as the holder of record, shall
take
such other action as may be reasonably requested by the Servicer. In addition,
if, as a result of the recording of the related Assignment of Mortgage, the
Owner, in its capacity as the holder of record, receives written notice of
any
action with respect to the related Mortgage or the related Mortgaged Property,
the Owner shall send a copy of such notice to the Servicer immediately in
accordance with the provisions of Section 9.8 of this Agreement. The Owner
agrees that the Servicer shall have no liability to the Owner for the Owner’s
failure to comply with the provisions set forth in this paragraph.
Section
6.2 Servicer
Covenants; Merger or Consolidation of the Servicer
37
(a) The
Servicer covenants that it will keep in full force and effect its existence,
rights and franchises as a federal savings bank, and its status as a Xxxxxx
Xxx
or Xxxxxxx Mac approved servicer in good standing and will obtain and preserve
its qualification to do business as a foreign corporation in each jurisdiction
in which such qualification is or shall be necessary to protect the validity
and
enforceability of this Agreement or any of the Mortgage Loans and to perform
its
duties under this Agreement.
(b) Any
Person into which the Servicer may be merged or consolidated, or any business
organization resulting from any merger, conversion or consolidation to which
the
Servicer shall be a party, or any Person succeeding to all or substantially
all
of the business or assets of the Servicer (whether or not related to loan
servicing), shall be the successor of the Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding; provided,
however, that the Servicer shall not, without the prior written approval of
the
Owner, be a party to any such merger, consolidation or conversion, or sell
or
otherwise dispose of all or substantially all of its business or assets unless
the successor or surviving person shall be an institution that is a Xxxxxx
Mae
or Xxxxxxx Mac approved servicer in good standing.
Section
6.3 Limitation
on Liability of the Servicer and Others
The
Servicer and the directors, officers, employees or agents of the Servicer shall
not be under any liability to the Owner for (a) any action taken or for
refraining from the taking of any action in good faith pursuant to this
Agreement, (b) errors in judgment, or (c) any action or inaction in accordance
with the direction or consent of the Owner; provided, however, this provision
shall not protect the Servicer against any breach of warranties or
representations made herein, any failure to perform its obligations in
accordance with any standard of care set forth in this Agreement (unless in
accordance with the direction or consent of the Owner), or any liability which
would otherwise be imposed by reason of willful misconduct, bad faith or
negligence in the performance of its duties or by reason of any breach of the
terms and conditions of the Agreement. The Servicer and any officer, employee
or
agent of the Servicer may rely in good faith on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder. Subject to Section 6.1, the Servicer shall not be under
any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties under this Agreement and which may involve it in any
expense or liability; provided, however, that the Servicer may, with the consent
of the Owner, undertake any such action which it may deem necessary or desirable
with respect to this Agreement and the rights, duties and the interests of
the
parties hereto. In such event, the legal expenses and costs of such action
and
any liability resulting therefrom shall be reimbursed to the Servicer in
accordance with Section 6.1.
Section
6.4 Servicer
Not to Resign
The
Servicer shall not resign from the obligations and duties hereby imposed on
it
except by mutual consent of the Servicer and the Owner or upon the determination
that the Servicer's duties hereunder are no longer permissible under Applicable
Requirements and such incapacity cannot be cured by the Servicer. Any such
determination permitting the resignation of the Servicer shall be evidenced
by
an Opinion of Counsel to such effect delivered to the Owner. No such resignation
shall become effective until a successor which satisfies the requirements set
forth in Section 9.1 has assumed the Servicer's responsibilities and obligations
hereunder in accordance with such Section.
38
Without
in any way limiting the generality of this Section 6.4, in the event that the
Servicer either shall assign this Agreement or the servicing responsibilities
hereunder or delegate its duties hereunder or any portion thereof or sell or
otherwise dispose of all or substantially all of its property or assets, without
the prior written consent of the Owner, then the Owner shall have the right
to
terminate this Agreement upon notice given as set forth in Section 8.2, without
any payment of any penalty or damages and without any liability whatsoever
to
the Servicer or any third party.
Section
6.5 No
Transfer of Servicing
The
Servicer acknowledges that the Owner has entered into this Agreement with the
Servicer in reliance upon the adequacy of the Servicer's servicing facilities,
plan, personnel, records, and procedures, its integrity, reputation, and
financial standing and the continuance thereof. Without in any way limiting
the
generality of this Section, the Servicer shall not either assign this Agreement
or the servicing hereunder without the prior written approval of the Owner
in its sole discretion.
ARTICLE
VII
DEFAULT
Section
7.1 Events
of Default
In
case
one or more of the following Events of Default by the Servicer shall occur
and
be continuing:
(i) any
failure by the Servicer to remit to the Owner when due any payment required
to
be made under the terms of this Agreement, which failure continues unremedied
for a period of two (2) days after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Owner; the Owner shall use reasonable efforts to notify the
Servicer that it has not received the payment due, but the Owner’s notice shall
not be a condition of the Event of Default; or
(ii) any
failure by the Servicer to duly observe or perform, in any material respect,
any
other covenant, obligation or agreement of the Servicer as set forth in this
Agreement, which failure continues unremedied for a period of 30 days after
the
date on which written notice of such failure, requiring the same to be remedied,
shall have been given to the Servicer by the Owner; or
(iii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, including bankruptcy, marshaling of assets and
liabilities, or similar proceedings, or for the winding-up or liquidation of
its
affairs, shall have been entered against the Servicer and such decree or order
shall have remained in force, undischarged or unstayed for a period of thirty
(30) days; or
39
(iv) the
Servicer shall consent to the appointment of a conservator, receiver or
liquidator in any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings of or relating to the Servicer or relating
to
all or substantially all of the Servicer's property; or
(v) the
Servicer shall admit in writing its inability to pay its debts as they become
due, file a petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of its creditors,
or
voluntarily suspend payment of its obligation or ceases its normal business
operations for three (3) Business Days; or
(vi) failure
by the Servicer to maintain its license to do business in any jurisdiction
where
a Mortgaged Property is located if such license is required and such failure
continues unremedied for a period of thirty (30) days; or
(vii) the
Servicer attempts to assign its right to servicing compensation hereunder or
to
assign this Agreement or the servicing responsibilities hereunder or to delegate
its duties hereunder or any portion thereof in violation of this Agreement,
including Section 6.5; or
(viii) the
Servicer shall cease to be an approved servicer for Xxxxxx Xxx or Xxxxxxx
Mac.
(ix) the
Servicer shall cease to have a minimum net worth of $25,000,000 as determined
in
accordance with the Financial Accounting Standards Board’s generally accepted
accounting principles;
then,
and
in each and every such case, so long as such Event of Default shall not have
been remedied, the Owner, by notice in writing to the Servicer (in each such
instance, the “Defaulted Servicer”),
may,
in addition to whatever rights the Owner may have at law or equity to damages,
including injunctive relief and specific performance, commence termination
of
all of the rights and obligations of the Defaulted Servicer under this Agreement
and may exercise any and all other remedies available at law or at equity.
Upon
receipt by the Defaulted Servicer of such written notice from the Owner stating
the intent to terminate the Defaulted Servicer as servicer under this Agreement
as a result of such Event of Default, all authority and power of the Defaulted
Servicer under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in the successor appointed pursuant
to
Section 9.1. Upon written request from the Owner, the Defaulted Servicer shall,
at its sole expense, prepare, execute, and deliver to a successor any and all
documents and other instruments, place in such successor's possession all
Collateral Files and Servicing Files, and do or cause to be done all other
acts
or things necessary or appropriate to effect the purposes of such notice of
termination, all of which shall be undertaken immediately and shall be completed
as soon as possible and in all events by not later than thirty (30) Business
Days following the Owner’s request therefor. The Defaulted Servicer agrees to
cooperate with the Owner and such successor in effecting the termination of
the
Defaulted Servicer's responsibilities and rights hereunder, including, without
limitation, the transfer to such successor for administration by it of all
cash
amounts which shall at the time be credited by the Defaulted Servicer to the
Custodial Account, the Escrow Account or the REO Account and all other amounts
which may thereafter be received with respect to the Mortgage Loans and to
which
the Defaulted Servicer is not entitled pursuant to the terms of this
Agreement.
40
Section
7.2 Waiver
of Defaults
The
Owner
may waive any default by the Defaulted Servicer in the performance of its
obligations hereunder and its consequences. Upon any waiver of a past default,
such default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been remedied for every purpose of this Agreement.
No
such waiver shall extend to any subsequent or other default or impair any right
consequent thereto except to the extent expressly so waived.
Section
7.3 Survival
of Certain Obligations and Liabilities of the Defaulted
Servicer
The
representations, warranties, covenants, indemnities and agreements of the
parties provided in this Agreement and the parties’ obligations hereunder shall
survive the execution and delivery and the termination or expiration of this
Agreement. Notwithstanding any termination of the rights and obligations of
the
Defaulted Servicer pursuant to this Section 7, the Defaulted Servicer shall
remain liable for any actions of the Defaulted Servicer prior to the effective
time of such termination.
ARTICLE
VIII
TERMINATION
Section
8.1 Termination
of Agreement
This
Agreement shall terminate upon any of: (i) the later of the distribution to
the Owner of final payment or liquidation with respect to the last Mortgage
Loan
and each REO Property, or the disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure with respect to the last Mortgage
Loan and the remittance of all funds due hereunder, (ii) the mutual consent
of the parties in writing, or (iii) the termination of the Servicer pursuant
to
Section 8.2.
Section
8.2 Termination
of the Servicer due to an Event of Default
(a) Upon
30
days’ written notice, the Owner may, at its sole option, upon the occurrence of
an Event of Default and in accordance with Section 7.1, terminate any rights
the
Servicer may have hereunder. Any such notice of termination shall be in writing
and delivered to the terminated Servicer (in such instance, the “Terminated
Servicer”)
by
registered mail as provided in Section 9.8 of this Agreement. If the Owner
so
terminates the rights of a Terminated Servicer, the Owner with full cooperation
of the Terminated Servicer shall arrange for the transfer of servicing to,
at
the Owner’s option, the Owner or a third party, and the Terminated Servicer
shall continue servicing, for the Servicing Fee provided herein, the Mortgage
Loans under this Agreement until the Owner gives the Terminated Servicer notice
of the transfer and such transfer has been completed.
41
(b) The
Terminated Servicer agrees to cooperate with the Owner and such successor in
effecting the termination of the Terminated Servicer's responsibilities and
rights hereunder, including, without limitation, the transfer to such successor
for administration by it of all cash amounts which shall at the time be credited
by the Terminated Servicer to the Custodial Account, the Escrow Account or
the
REO Account, or thereafter be received with respect to the Mortgage Loans and
to
which the Terminated Servicer is not entitled pursuant to the terms of this
Agreement.
Section
8.3 Termination
Without Cause
Upon
at
least 30 days prior notice, the Owner may terminate, at its sole option, the
Servicer without cause. Any such notice of termination shall be in writing
and
delivered to the Servicer and any Rating Agency by registered mail as provided
in Section 9.7. In the event the Owner so chooses to terminate the Servicer,
the
Servicer shall be entitled to receive, as liquidated damages, upon its
termination as Servicer hereunder without cause pursuant to this Section 8.3,
an
amount equal to four percent (4%) of the aggregate outstanding principal amount
of each Mortgage Loan as of the termination date paid by the Owner to the
Servicer.
ARTICLE
IX
MISCELLANEOUS
PROVISIONS
Section
9.1 Successor
to the Servicer
(a) Prior
to
termination of the Servicer's responsibilities and duties under this Agreement
pursuant to Section 6.4, 7.1, 8.1 or 8.2, the Owner shall either
(i) succeed to and assume all of the Servicer's responsibilities, rights,
duties, and obligations under this Agreement from and after the date of such
succession or (ii) appoint a successor to the Servicer that shall succeed to
all
rights and assume all of the responsibilities, duties and liabilities of the
Servicer under this Agreement prior to the termination of the Servicer's
responsibilities, duties and liabilities under this Agreement pursuant to
Section 8.2 above. In the event that the Servicer's duties, responsibilities,
and liabilities under this Agreement shall be terminated pursuant to the
foregoing Sections, the Servicer shall discharge such duties and
responsibilities, and be compensated therefor as provided in this Agreement,
during the period from the date it acquires knowledge of such termination until
the effective date thereof with the same degree of diligence and prudence which
it is obligated to exercise under this Agreement and shall take no action
whatsoever that might impair or prejudice the rights or financial condition
of
its successor. The resignation or removal of the Servicer pursuant to the
foregoing Sections shall not become effective until a successor shall have
been
appointed pursuant to this Section and shall in no event relieve the Servicer
of
its non-servicing duties, obligations, covenants, representations and
warranties, it being understood and agreed that the provisions of Sections
5.10,
6.1, Article 7 and Article 8 shall be applicable to the Servicer notwithstanding
any such resignation or termination of the Servicer or the termination of this
Agreement.
42
(b) The
Servicer shall promptly deliver to the successor (i) the funds in the Custodial
Account and the Escrow Account to which the Owner is entitled pursuant to the
terms of this Agreement, (ii) all other funds to which the Owner is entitled
pursuant to the terms of this Agreement net of any unreimbursed Advances, (iii)
all other amounts which may thereafter be received with respect to the Mortgage
Loans and to which the Servicer is not entitled pursuant to the terms of this
Agreement and (iv) all Collateral Files and Servicing Files and related
documents and statements held by it hereunder. The Servicer shall account for
all funds and shall execute and deliver such instruments and do such other
things as may reasonably be required to more fully and definitively vest in
the
successor all such rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer.
(c) Upon
a
successor's acceptance of appointment as such, the Owner shall notify the
Servicer of such appointment.
Section
9.2 Amendment
This
Agreement may be amended from time to time by the parties by written agreement
signed by both of the parties.
Section
9.3 Duration
of Agreement
This
Agreement shall continue in existence and effect until terminated as herein
provided.
Section
9.4 Governing
Law
THE
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE
STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO THE CONFLICTS OF LAWS PROVISIONS OF NEW YORK OR ANY
OTHER JURISDICTION.
Section
9.5 General
Interpretive Principles
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
(i) the
terms
defined in this Agreement have the meanings assigned to them in this Agreement
and include the plural as well as the singular, and the use of any gender herein
shall be deemed to include the other gender;
(ii) accounting
terms not otherwise defined herein have the meanings assigned to them in
accordance with generally accepted accounting principles;
43
(iii) references
herein to "Articles," "Sections," "Subsections," "Paragraphs," and other
subdivisions without reference to a document are to designated Articles,
Sections, Subsections, Paragraphs, and other subdivisions of this
Agreement;
(iv) a
reference to a Subsection without further reference to a Section is a reference
to such Subsection as contained in the same Section in which the reference
appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(v) the
words
"herein," "hereof," "hereunder," and other words of similar import refer to
this
Agreement as a whole and not to any particular provision; and
(vi) the
term
"include" or "including" shall mean without limitation by reason of enumeration.
Section
9.6 Reproduction
of Documents
This
Agreement and all documents relating hereto, including without limitation
(i) consents, waivers, and modifications which may hereafter be executed,
(ii) documents received by any party at the closing, and
(iii) financial statements, certificates, and other information previously
or hereafter furnished, may be reproduced by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process. The
parties agree that any such reproduction shall be admissible in evidence as
the
original itself in any judicial or administrative proceeding, whether or not
the
original is in existence and whether or not such reproduction was made by a
party in the regular course of business, and that any enlargement, facsimile
or
further reproduction of such reproduction shall likewise be admissible in
evidence.
Section
9.7 Notices
All
demands, notices, consents, waivers and other communications hereunder shall
be
in writing and shall be deemed to have been duly given if personally delivered
or delivered by facsimile, overnight courier, or registered mail, postage
prepaid, or delivered by telefacsimile, to:
(i) in
the
case of the Servicer, at the address set forth below or such other address
as
may hereafter be furnished to the Owner in writing by the Servicer:
IndyMac
Bank, F.S.B
0000
Xxxx
Xxxxxxxx Xxxxxxxxx
Xxxxxxxx,
Xxxxxxxxxx 00000
Attn:
Secondary Marketing
(ii) in
the
case of the Owner, at the address set forth below, or such other address as
may
hereafter be furnished to the Servicer by the Owner:
Xxxxxxx
Xxxxx Mortgage Company
00
Xxxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxxx Xxxxxxx
Tel:
(000) 000-0000
Fax:
(000) 000-0000
44
with
copies to:
Xxxxxxx
Xxxxx Mortgage Company
Xxx
Xxx
Xxxx Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxx Xxxxxxxxxx
Tel:
(000) 000-0000
Fax:
(000) 000-0000
and
Xxxxxxx
Xxxxx Mortgage Company
000
Xxxxxx Xxxxxx Xxxxx
Xxxxx
000
Xxxxx
Xx.
Xxxxxxxxxx, XX 00000
Attention:
Xxxxxx Xxxxx
Tel:
(000) 000-0000
Fax:
(000) 000-0000
and
in
the case of any subsequent Owner, as set forth in written notice supplied to
the
Servicer by such subsequent Owner. All reports that are due to the Owner from
the Servicer pursuant to Section 4.2 shall be deemed to have been duly given
if
delivered to the Internet address from time to time provided by the Owner to
the
Servicer.
Section
9.8 Severability
of Provisions
If
any
one or more of the covenants, agreements, provisions or terms of this Agreement
shall be held invalid for any reason whatsoever, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in no
way
affect the validity or enforceability of the other covenants, agreements,
provisions or terms of this Agreement or the rights of the Owner hereunder.
If
the invalidity of any part, provision, representation or warranty of this
Agreement shall deprive any party of the economic benefit intended to be
conferred by this Agreement, the parties shall negotiate in good faith to
develop a structure the economic effect of which is nearly as possible the
same
as the economic effect of this Agreement without regard to such
invalidity.
Section
9.9 Disclosure
of Relationship
Each
party (including the respective affiliates) shall have the right upon obtaining
prior written consent from the other party, from time to time, to publish,
distribute, advertise or otherwise disclose the relationship and the general
services created and performed under this Agreement; provided, however, such
disclosure shall not identify the amount or nature of fees earned or to be
paid
hereunder. No disclosure permitted by this Section 9.10 shall include any
Mortgagor information.
45
Section
9.10 Exhibits
and Schedules
The
following exhibits and schedules to this Agreement are hereby incorporated
and
made a part hereof and are an integral part of this Agreement:
|
Exhibit
A
|
MORTGAGE
LOAN SCHEDULE
|
|
Exhibit
B
|
LIST
OF COLLATERAL DOCUMENTS
|
|
Exhibit
C
|
LIST
OF DOCUMENTS IN CREDIT FILE
|
|
Exhibit
D
|
FORM
OF ANNUAL CERTIFICATION
|
|
Exhibit
E
|
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF
COMPLIANCE
|
Section
9.11 Counterparts;
Successors and Assigns
This
Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed, shall
be deemed to be an original; such counterparts, together, shall constitute
one
and the same agreement. Subject to Sections 6.4, 6.5, 7.1 and 8.1, this
Agreement shall inure to the benefit of and be binding upon the Servicer, the
Owner and their respective successors and assigns.
Section
9.12 Effect
of Headings
The
headings in this Agreement are for purposes of reference only and shall not
limit or otherwise affect the meaning hereof.
Section
9.13 Other
Agreements Superseded
This
Agreement supersedes all prior agreements and understandings relating to the
subject matter hereof.
Section
9.14 Confidentiality
Each
of
the Owner and the Servicer shall employ proper procedures and standards designed
to maintain the confidential nature of the terms of this Agreement, except
to
the extent (a) the disclosure of such terms is reasonably believed by such
party
to be required in connection with regulatory requirements or other legal
requirements relating to its affairs; (b) such terms are disclosed to any
one or more of such party’s employees, officers, directors, agents, attorneys or
accountants who would have access to the contents of this Agreement and such
data and information in the normal course of the performance of such Person’s
duties for such party, to the extent such party has procedures in effect to
inform such Person of the confidential nature thereof; (c) such terms are
disclosed in a prospectus, prospectus supplement or private placement memorandum
relating to a Securitization of the Mortgage Loans by the Owner (or an affiliate
assignee thereof) or to any Person in connection with the resale or proposed
resale of all or a portion of the Mortgage Loans by such party in accordance
with the terms of this Agreement; and (d) that is reasonably believed by such
party to be necessary for the enforcement of such party’s rights under this
Agreement.
46
ARTICLE
X
COMPLIANCE
WITH REGULATION AB
Section
10.1 Intent
of the Parties; Reasonableness.
The
Owner
and the Servicer acknowledge and agree that the purpose of Article X of this
Agreement is to facilitate compliance by the Owner and any Depositor with the
provisions of Regulation AB and related rules and regulations of the Commission.
Although Regulation AB is applicable by its terms only to offerings of
asset-backed securities that are registered under the Securities Act, the
Servicer acknowledges that investors in privately offered securities may require
that the Owner 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 Owner 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 Servicer acknowledges that interpretations of the
requirements of Regulation AB may change over time, whether due to interpretive
guidance provided by the Commission or its staff, consensus among participants
in the asset-backed securities markets, advice of counsel, or otherwise, and
agrees to comply with requests made by the Owner 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 Servicer shall cooperate fully with the Owner to deliver to
the
Owner (including any of its assignees or designees) and any Depositor, any
and
all statements, reports, certifications, records and any other information
necessary in the good faith determination of the Owner or any Depositor to
permit the Owner or such Depositor to comply with the provisions of Regulation
AB, together with such disclosures relating to the Servicer any Subservicer
and
the Mortgage Loans, or the servicing of the Mortgage Loans, reasonably believed
by the Owner or any Depositor to be necessary in order to effect such
compliance.
The
Owner
(including any of its assignees or designees) shall cooperate with the Servicer
by providing timely notice of requests for information under these provisions
and by reasonably limiting such requests to information required, in the Owner’s
reasonable judgment, to comply with Regulation AB.
Section
10.2 Additional
Representations and Warranties of the Servicer.
47
(a) The
Servicer shall be deemed to represent to the Owner and to any Depositor, as
of
the date on which information is first provided to the Owner or any Depositor
under Section 10.3 that, except as disclosed in writing to the Owner or such
Depositor prior to such date: (i) the Servicer 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 Servicer; (ii) the Servicer 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 Servicer as servicer
has been disclosed or reported by the Servicer; (iv) no material changes to
the
Servicer’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 Servicer’s financial condition that could have a material
adverse effect on the performance by the Servicer 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 Servicer or any Subservicer; and (vii) there are no affiliations,
relationships or transactions relating to the Servicer or any Subservicer with
respect to any Securitization Transaction and any party thereto identified
by
the related Depositor of a type described in Item 1119 of Regulation
AB.
(b) If
so
requested by the Owner or any Depositor on any date following the date on which
information is first provided to the Owner or any Depositor under Section 10.3,
the Servicer 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
10.3 Information
to Be Provided by the Servicer.
In
connection with any Securitization Transaction the Servicer shall (i) within
five Business Days following request by the Owner or any Depositor, provide
to
the Owner and such Depositor (or cause each Subservicer to provide), in writing
and in form and substance reasonably satisfactory to the Owner and such
Depositor, the information and materials specified in paragraphs (a), (c) and
(f) of this Section, and (ii) as promptly as practicable following notice to
or
discovery by the Servicer, provide to the Owner and any Depositor (in writing
and in form and substance reasonably satisfactory to the Owner and such
Depositor) the information specified in paragraph (d) of this
Section.
(a) If
so
requested by the Owner or any Depositor, the Servicer shall provide such
information regarding each each Subservicer, meeting the requirements of Items
1103(a)(1), 1117 and 1119 of Regulation AB. Such information shall include,
at a
minimum:
(A) [Reserved];
(B) [Reserved];
48
(C) a
description of any material legal or governmental proceedings pending (or known
to be contemplated) against the Servicer and each Subservicer; and
(D) a
description of any affiliation or relationship between the Servicer, each
Subservicer and any of the following parties to a Securitization Transaction,
as
such parties are identified to the Servicer by the Owner 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) [Reserved].
(c) If
so
requested by the Owner or any Depositor, the Servicer shall provide such
information regarding the Servicer, as servicer of the Mortgage Loans, and
each
Subservicer (each of the Servicer and each Subservicer, for purposes of this
paragraph, a “Servicer”),
as is
requested for the purpose of compliance with Item 1108 of Regulation AB. Such
information shall include, at a minimum:
(A) the
Servicer’s form of organization;
(B) a
description of how long the Servicer has been servicing residential mortgage
loans; a general discussion of the Servicer’s experience in servicing assets of
any type as well as a more detailed discussion of the Servicer’s experience in,
and procedures for, the servicing function it will perform under this 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 Owner 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;
49
(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 Owner 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 this
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 Servicer
of its servicing obligations under this 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.
50
(d) If
so
requested by the Owner or any Depositor for the purpose of satisfying its
reporting obligation under the Exchange Act with respect to any class of
asset-backed securities, the Servicer shall (or shall cause each Subservicer
to)
(i) notify the Owner and any Depositor in writing of (A) any material litigation
or governmental proceedings pending against the Servicer or any Subservicer
and
(B) any affiliations or relationships that develop following the closing date
of
a Securitization Transaction between the Servicer or any Subservicer and any
of
the parties specified in clause (D) of paragraph (a) of this Section (and any
other parties identified in writing by the requesting party) with respect to
such Securitization Transaction, and (ii) provide to the Owner and any Depositor
a description of such proceedings, affiliations or relationships.
(e) As
a
condition to the succession to the Servicer or any Subservicer as servicer
or
subservicer under this Agreement or any Reconstitution Agreement by any Person
(i) into which the Servicer or such Subservicer may be merged or consolidated,
or (ii) which may be appointed as a successor to the Servicer or any
Subservicer, the Servicer shall provide to the Owner and any Depositor, at
least
15 calendar days prior to the effective date of such succession or appointment,
(x) written notice to the Owner and any Depositor of such succession or
appointment and (y) in writing and in form and substance reasonably satisfactory
to the Owner and such Depositor, all information reasonably requested by the
Owner or any Depositor in order to comply with its reporting obligation under
Item 6.02 of Form 8-K with respect to any class of asset-backed
securities.
(f) In
addition to such information as the Servicer, as servicer, is obligated to
provide pursuant to other provisions of this Agreement, if so requested by
the
Owner or any Depositor, the Servicer shall provide such information regarding
the performance or servicing of the Mortgage Loans as is reasonably required
by
the Owner or any Depositor to facilitate preparation of distribution reports
in
accordance with Item 1121 of Regulation AB and to permit the Owner or such
Depositor to comply with the provisions of Regulation AB relating to Static
Pool
Information regarding the performance of the Mortgage Loans on the basis of
the
Owner's or such Depositor's reasonable, good faith interpretation of the
requirements of Item 1105(a)(1)-(3) of Regulation AB (including without
limitation as to the format and content of such Static Pool Information). Such
information shall be provided concurrently with the monthly reports otherwise
required to be delivered by the servicer under this Agreement, commencing with
the first such report due not less than ten (10) Business Days following such
request.
Section
10.4 Servicer
Compliance Statement.
On
or
before March 1 of each calendar year, commencing in 2007, the Servicer shall
deliver to the Owner and any Depositor a statement of compliance addressed
to
the Owner and such Depositor and signed by an authorized officer of the
Servicer, to the effect that (i) a review of the Servicer’s activities during
the immediately preceding calendar year (or applicable portion thereof) and
of
its performance under this Agreement and any applicable Reconstitution Agreement
during such period has been made under such officer’s supervision, and (ii) to
the best of such officers’ knowledge, based on such review, the Servicer has
fulfilled all of its obligations under this Agreement and any applicable
Reconstitution Agreement in all material respects throughout such calendar
year
(or applicable portion thereof) or, if there has been a failure to fulfill
any
such obligation in any material respect, specifically identifying each such
failure known to such officer and the nature and the status
thereof.
51
Section
10.5 Report
on Assessment of Compliance and Attestation.
(a) On
or
before March 1 of each calendar year, commencing in 2007, the Servicer
shall:
(i) deliver
to the Owner and any Depositor a report (in form and substance reasonably
satisfactory to the Owner and such Depositor) regarding the Servicer’s
assessment of compliance with the Servicing Criteria during the immediately
preceding calendar year, as required under Rules 13a-18 and 15d-18 of the
Exchange Act and Item 1122 of Regulation AB. Such report shall be addressed
to
the Owner and such Depositor and signed by an authorized officer of the
Servicer, and shall address each of the Servicing Criteria specified on a
certification substantially in the form of Exhibit E hereto delivered to the
Owner concurrently with the execution of this Agreement;
(ii) deliver
to the Owner and any Depositor a report of a registered public accounting firm
reasonably acceptable to the Owner and such Depositor that attests to, and
reports on, the assessment of compliance made by the Servicer and delivered
pursuant to the preceding paragraph. Such attestation shall be in accordance
with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act
and
the Exchange Act;
(iii) cause
each Subservicer, and each Subcontractor determined by the Servicer pursuant
to
Section 10.6(b) to be “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, to deliver to the Owner and any Depositor
an assessment of compliance and accountants’ attestation as and when provided in
paragraphs (a) and (b) of this Section; and
(iv) if
requested by the Owner or any Depositor not later than February 1 of the
calendar year in which such certification is to be delivered, deliver to the
Owner, any Depositor and any other Person that will be responsible for signing
the certification (a “Sarbanes
Certification”)
required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act (pursuant
to
Section 302 of the Xxxxxxxx-Xxxxx Act of 2002) on behalf of an asset-backed
issuer with respect to a Securitization Transaction a certification in the
form
attached hereto as Exhibit D.
The
Servicer acknowledges that the parties identified in clause (a)(iv) above may
rely on the certification provided by the Servicer pursuant to such clause
in
signing a Sarbanes Certification and filing such with the Commission. Neither
the Owner nor any Depositor will request delivery of a certification under
clause (a)(iv) above, unless a Depositor is required under the Exchange Act
to
file an annual report on Form 10-K with respect to an issuing entity whose
asset
pool includes Mortgage Loans.
(b) Each
assessment of compliance provided by a Subservicer pursuant to Section
10.5(a)(i) shall address each of the Servicing Criteria specified on a
certification substantially in the form of Exhibit E hereto delivered to the
Owner concurrently with the execution of this Agreement or, in the case of
a
Subservicer subsequently appointed as such, on or prior to the date of such
appointment. An assessment of compliance provided by a Subcontractor pursuant
to
Section 10.5(a)(iii) need not address any elements of the Servicing Criteria
other than those specified by the Servicer pursuant to Section
10.6.
52
Section
10.6 Use
of
Subservicers and Subcontractors.
The
Servicer shall not hire or otherwise utilize the services of any Subservicer
to
fulfill any of the obligations of the Servicer as servicer under this Agreement
or any Reconstitution Agreement unless the Servicer complies with the provisions
of paragraph (a) of this Section. The Servicer shall not hire or otherwise
utilize the services of any Subcontractor, and shall not permit any Subservicer
to hire or otherwise utilize the services of any Subcontractor, to fulfill
any
of the obligations of the Servicer as servicer under this Agreement or any
Reconstitution Agreement unless the Servicer complies with the provisions of
paragraph (b) of this Section.
(a) It
shall
not be necessary for the Servicer to seek the consent of the Owner or any
Depositor to the utilization of any Subservicer. The Servicer shall cause any
Subservicer used by the Servicer (or by any Subservicer) for the benefit of
the
Owner and any Depositor to comply with the provisions of this Section and with
Sections 13.02, 13.03(c) and (e), 13.04, 13.05 and 13.07 of this Agreement
to
the same extent as if such Subservicer were the Servicer, and to provide the
information required with respect to such Subservicer under Section 10.3(d)
of
this Agreement. The Servicer shall be responsible for obtaining from each
Subservicer and delivering to the Owner and any Depositor any servicer
compliance statement required to be delivered by such Subservicer under Section
10.4, any assessment of compliance and attestation required to be delivered
by
such Subservicer under Section 10.5 and any certification required to be
delivered to the Person that will be responsible for signing the Sarbanes
Certification under Section 10.5 as and when required to be
delivered.
(b) It
shall
not be necessary for the Servicer to seek the consent of the Owner or any
Depositor to the utilization of any Subcontractor. The Servicer shall promptly
upon request provide to the Owner and any Depositor (or any designee of the
Depositor, such as a master servicer or administrator) a written description
(in
form and substance satisfactory to the Owner and such Depositor) of the role
and
function of each Subcontractor utilized by the Servicer or any Subservicer,
specifying (i) the identity of each such Subcontractor, (ii) which (if any)
of
such Subcontractors are “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, and (iii) which elements of the Servicing
Criteria will be addressed in assessments of compliance provided by each
Subcontractor identified pursuant to clause (ii) of this paragraph.
As
a
condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, the Servicer shall cause any such Subcontractor used by the
Servicer (or by any Subservicer) for the benefit of the Owner and any Depositor
to comply with the provisions of Sections 13.05 and 13.07 of this Agreement
to
the same extent as if such Subcontractor were the Servicer. The Servicer shall
be responsible for obtaining from each Subcontractor and delivering to the
Owner
and any Depositor any assessment of compliance and attestation required to
be
delivered by such Subcontractor under Section 10.5, in each case as and when
required to be delivered.
53
Section
10.7 Indemnification;
Remedies.
(a) The
Servicer shall indemnify the Owner, each affiliate of the Owner, and each of
the
following parties participating in a Securitization Transaction: each sponsor
and issuing entity; each Person responsible for the preparation, execution
or
filing of any report required to be filed with the Commission with respect
to
such Securitization Transaction, or for execution of a certification pursuant
to
Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction; each broker dealer acting as underwriter, placement
agent or initial purchaser, each Person who controls any of such parties or
the
Depositor (within the meaning of Section 15 of the Securities Act and Section
20
of the Exchange Act); and the respective present and former directors, officers,
employees and agents of each of the foregoing and of the Depositor, and shall
hold each of them harmless from and against any losses, damages, penalties,
fines, forfeitures, legal fees and expenses and related costs, judgments, and
any other costs, fees and expenses that any of them may sustain arising out
of
or based upon:
(1)(a) any
untrue statement of a material fact contained or alleged to be contained in
any
information, report, certification, accountants’ letter or other material
provided under this Article X by or on behalf of the Servicer, or provided
in
written or electronic form under this Article X by or on behalf of any
Subservicer or Subcontractor (collectively, the “Servicer Information”),
or
(b) the omission or alleged omission to state in the Servicer Information a
material fact required to be stated in the Servicer Information or necessary
in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, by way of clarification, that
clause (B) of this paragraph shall be construed solely by reference to the
Servicer Information and not to any other information communicated in connection
with a sale or purchase of securities, without regard to whether the Servicer
Information or any portion thereof is presented together with or separately
from
such other information;
(ii) any
failure by the Servicer, any Subservicer or any Subcontractor to deliver any
information, report, certification, accountants’ letter or other material when
and as required under this Article X, including any failure by the Servicer
to
identify pursuant to Section 10.6(b) any Subcontractor “participating in the
servicing function” within the meaning of Item 1122 of Regulation AB;
or
(iii) any
breach by the Servicer of a representation or warranty set forth in Section
10.2(a) or in a writing furnished pursuant to Section 10.2(b) and made as of
a
date prior to the closing date of the related Securitization Transaction, to
the
extent that such breach is not cured by such closing date, or any breach by
the
Servicer of a representation or warranty in a writing furnished pursuant to
Section 10.2(b) to the extent made as of a date subsequent to such closing
date.
In
the
case of any failure of performance described in clause (a)(ii) of this Section,
the Servicer shall promptly reimburse the Owner, any Depositor, as applicable,
and each Person responsible for the preparation, execution or filing of any
report required to be filed with the Commission with respect to such
Securitization Transaction, or for execution of a certification pursuant to
Rule
13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction, for all costs reasonably incurred by each such
party
in order to obtain the information, report, certification, accountants’ letter
or other material not delivered as required by the Service, any Subservicer
or
any Subcontractor.
54
(b) (2) Any
failure by the Seller, Servicer, any Subservicer or any Subcontractor to deliver
any information, report, certification, accountants’ letter or other material
when and as required under this Article X or under Article VII of the Purchase
Agreement, or any breach by the Servicer of a representation or warranty set
forth in Section 10.2(a) or in a writing furnished pursuant to Section 10.2(b)
or any breach by the Seller of a representation or warranty set forth in Section
7.02(a) of the Purchase Agreement or in a writing furnished pursuant to Section
7.02(b) of the Purchase Agreement and made as of a date prior to the closing
date of the related Securitization Transaction, to the extent that such breach
is not cured by such closing date, or any breach by the Servicer of a
representation or warranty in a writing furnished pursuant to Section 10.2(b)
or
any breach by the Seller of a representation or warranty in a writing furnished
pursuant to Section 7.02(b) of the Purchase Agreement to the extent made as
of a
date subsequent to such closing date, shall, except as provided in clause (ii)
of this paragraph, immediately and automatically, without notice or grace
period, constitute an Event of Default with respect to the Servicer under this
Agreement and any applicable Reconstitution Agreement, and shall entitle the
Owner or Depositor, as applicable, in its sole discretion to terminate the
rights and obligations of the Servicer as servicer under this Agreement and/or
any applicable Reconstitution Agreement without payment (notwithstanding
anything in this Agreement or any applicable Reconstitution Agreement to the
contrary) of any compensation to the Servicer; provided that to the extent
that
any provision of this Agreement and/or any applicable Reconstitution Agreement
expressly provides for the survival of certain rights or obligations following
termination of the Servicer as servicer, such provision shall be given
effect.
(ii) Any
failure by the Servicer, any Subservicer or any Subcontractor to deliver any
information, report, certification or accountants’ letter when and as required
under Section 10.4 or 13.05, including (except as provided below) any failure
by
the Servicer to identify pursuant to Section 10.6(b) any Subcontractor
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, which continues unremedied for ten calendar days after the date
on which such information, report, certification or accountants’ letter was
required to be delivered shall constitute an Event of Default with respect
to
the Servicer under this Agreement and any applicable Reconstitution Agreement,
and shall entitle the Owner or Depositor, as applicable, in its sole discretion
to terminate the rights and obligations of the Servicer as servicer under this
Agreement and/or any applicable Reconstitution Agreement without payment
(notwithstanding anything in this Agreement to the contrary) of any compensation
to the Servicer; provided that to the extent that any provision of this
Agreement and/or any applicable Reconstitution Agreement expressly provides
for
the survival of certain rights or obligations following termination of the
Servicer as servicer, such provision shall be given effect.
Neither
the Owner nor any Depositor shall be entitled to terminate the rights and
obligations of the Servicer pursuant to this subparagraph (b)(ii) if a failure
of the Servicer to identify a Subcontractor “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB was attributable
solely to the role or functions of such Subcontractor with respect to mortgage
loans other than the Mortgage Loans.
55
(iii) The
Servicer shall promptly reimburse the Owner (or any designee of the Owner,
such
as a master servicer) and any Depositor, as applicable, for all reasonable
expenses incurred by the Owner (or such designee) or such Depositor, as such
are
incurred, in connection with the termination of the Servicer as servicer and
the
transfer of servicing of the Mortgage Loans to a successor servicer. The
provisions of this paragraph shall not limit whatever rights the Owner or any
Depositor may have under other provisions of this Agreement and/or any
applicable Reconstitution Agreement or otherwise, whether in equity or at law,
such as an action for damages, specific performance or injunctive
relief.
[signatures
start on next page]
56
IN
WITNESS WHEREOF, the Servicer and the Owner have caused their names to be signed
to this Servicing Agreement by their respective officers thereunto duly
authorized as of the day and year first above written.
SERVICER:
INDYMAC
BANK, F.S.B.
By:
_________________________________
Name:
Title:
Name:
Title:
OWNER:
XXXXXXX
XXXXX MORTGAGE COMPANY
By:
_________________________________
Name:
Title:
Name:
Title:
EXHIBIT
A
MORTGAGE
LOAN SCHEDULE
[attach
read-only diskette]
A-1
EXHIBIT
B
LIST
OF CREDIT DOCUMENTS
Copy
of
Note
Copy
of
Mortgage or Deed of Trust, including all riders
Copy
of
all riders to Note and Mortgage or Deed of Trust
Settlement
statement (HUD 1)
Copy
of
PMI Certificate (if applicable)
Appraisal
Flood
determination certificate
Hazard
Insurance declaration page
Loan
application
B-1
EXHIBIT
C
LIST
OF DOCUMENTS IN COLLATERAL FILE
(a) the
original Mortgage Note bearing all intervening endorsements, endorsed in blank
and signed in the name of the Seller by an officer thereof;
(b) the
original Assignment of Mortgage with assignee’s name left blank;
(c) the
original of any guarantee executed in connection with the Mortgage
Note;
(d) the
original Mortgage with evidence of recording thereon, or if any such mortgage
has not been returned from the applicable recording office or has been lost,
or
if such public recording office retains the original recorded mortgage, a
photocopy of such mortgage certified by the Seller to be a true and complete
copy of the original recorded mortgage;
(e) the
originals of all assumption, modification, consolidation or extension
agreements, if any, with evidence of recording thereon;
(f) the
originals of all intervening assignments of mortgage with evidence of recording
thereon, or if any such intervening assignment of mortgage has not been returned
from the applicable recording office or has been lost or if such public
recording office retains the original recorded assignments of mortgage, a
photocopy of such intervening assignment of mortgage, certified by the Seller
to
be a true and complete copy of the original recorded intervening assignment
of
mortgage;
(g) the
original mortgagee title insurance policy including an Environmental Protection
Agency Endorsement and, with respect to any Adjustable Rate Mortgage Loan,
an
adjustable-rate endorsement;
(h) the
original of any security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage;
(i) a
copy of
any applicable power of attorney; and
(j) with
respect to any Cooperative Loan, the applicable Cooperative Loan
Documents.
C-1
EXHIBIT
D
FORM
OF
ANNUAL CERTIFICATION
|
Re:
|
The
[ ] agreement dated as of [ ], 200[ ] (the “Agreement”), among Indymac
Bank, F.S.B and Xxxxxxx Sachs Mortgage
Company.
|
I,
________________________________, the _______________________ of Indymac Bank,
F.S.B. (the “Company”),
certify to Xxxxxxx Xxxxx Mortgage Co., [the Depositor], and the [Master
Servicer] [Securities Administrator] [Trustee], and their officers, with the
knowledge and intent that they will rely upon this certification,
that:
1. I
have
reviewed the servicer compliance statement of the Company provided in accordance
with Item 1123 of Regulation AB (the “Compliance
Statement”),
the
report on assessment of the Company’s compliance with the servicing criteria set
forth in Item 1122(d) of Regulation AB (the “Servicing
Criteria”),
provided in accordance with Rules 13a-18 and 15d-18 under Securities Exchange
Act of 1934, as amended (the “Exchange
Act”)
and
Item 1122 of Regulation AB (the “Servicing
Assessment”),
the
registered public accounting firm’s attestation report provided in accordance
with Rules 13a-18 and 15d-18 under the Exchange Act and Section 1122(b) of
Regulation AB (the “Attestation
Report”),
and
all servicing reports, officer’s certificates and other information relating to
the servicing of the Mortgage Loans by the Company during 200[ ] that were
delivered by the Company to the [Depositor] [Master Servicer] [Securities
Administrator] [Trustee] pursuant to the Agreement (collectively, the
“Company
Servicing Information”);
2. Based
on
my knowledge, the Company Servicing Information, taken as a whole, does not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in the light of the circumstances under
which such statements were made, not misleading with respect to the period
of
time covered by the Company Servicing Information;
3. Based
on
my knowledge, all of the Company Servicing Information required to be provided
by the Company under the Agreement has been provided to the [Depositor] [Master
Servicer] [Securities Administrator] [Trustee];
4. I
am
responsible for reviewing the activities performed by the Company as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed in
the
Compliance Statement, the Servicing Assessment or the Attestation Report, the
Company has fulfilled its obligations under the Agreement in all material
respects; and
D-1
5. The
Compliance Statement required to be delivered by the Company pursuant to the
Agreement, and the Servicing Assessment and Attestation Report required to
be
provided by the Company and by any Subservicer or Subcontractor pursuant to
the
Agreement, have been provided to the [Depositor] [Master Servicer]. Any material
instances of noncompliance described in such reports have been disclosed to
the
[Depositor] [Master Servicer]. Any material instance of noncompliance with
the
Servicing Criteria has been disclosed in such reports.
Date:
_________________________________
By:
__________________________________
Name:
Title:
Name:
Title:
D-2
EXHIBIT
E
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by Indymac Bank, F.S.B., [Subservicer]
shall address, at a minimum, the criteria identified as below as “Applicable
Servicing Criteria”:
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
General
Servicing Considerations
|
||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
|
|
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
|
|
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the mortgage loans are maintained.
|
|
|
1122(d)(1)(iv)
|
A
fidelity bond and errors and omissions policy is in effect on the
party
participating in the servicing function throughout the reporting
period in
the amount of coverage required by and otherwise in accordance with
the
terms of the transaction agreements.
|
|
|
Cash
Collection and Administration
|
||
|
1122(d)(2)(i)
|
Payments
on mortgage loans are deposited into the appropriate custodial bank
accounts and related bank clearing accounts no more than two business
days
following receipt, or such other number of days specified in the
transaction agreements.
|
|
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
|
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are made,
reviewed and approved as specified in the transaction
agreements.
|
E-1
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth
in the
transaction agreements.
|
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1122(d)(2)(v)
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Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institution” with respect to
a foreign financial institution means a foreign financial institution
that
meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange
Act.
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1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized
access.
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1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities related
bank accounts, including custodial accounts and related bank clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliation; and (D) contain explanations for reconciling items.
These
reconciling items are resolved within 90 calendar days of their original
identification, or such other number of days specified in the transaction
agreements.
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Investor
Remittances and Reporting
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||
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1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission, are
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with
the
terms specified in the transaction agreements; (C) are filed with
the
Commission as required by its rules and regulations; and (D) agree
with
investors’ or the trustee’s records as to the total unpaid principal
balance and number of mortgage loans serviced by the
Servicer.
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E-2
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
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1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with timeframes,
distribution priority and other terms set forth in the transaction
agreements.
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1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
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1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank
statements.
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Pool
Asset Administration
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1122(d)(4)(i)
|
Collateral
or security on mortgage loans is maintained as required by the transaction
agreements or related mortgage loan documents.
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1122(d)(4)(ii)
|
Mortgage
loan and related documents are safeguarded as required by the transaction
agreements
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1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements in
the
transaction agreements.
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1122(d)(4)(iv)
|
Payments
on mortgage loans, including any payoffs, made in accordance with
the
related mortgage loan documents are posted to the Servicer’s obligor
records maintained no more than two business days after receipt,
or such
other number of days specified in the transaction agreements, and
allocated to principal, interest or other items (e.g., escrow) in
accordance with the related mortgage loan documents.
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1122(d)(4)(v)
|
The
Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal
balance.
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1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor’s mortgage loans (e.g.,
loan modifications or re-agings) are made, reviewed and approved
by
authorized personnel in accordance with the transaction agreements
and
related pool asset documents.
|
E-3
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(4)(vii)
|
Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
and
deeds in lieu of foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
agreements.
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1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period a
mortgage
loan is delinquent in accordance with the transaction agreements.
Such
records are maintained on at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent mortgage loans including, for
example,
phone calls, letters and payment rescheduling plans in cases where
delinquency is deemed temporary (e.g., illness or
unemployment).
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1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for mortgage loans with variable
rates are computed based on the related mortgage loan
documents.
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1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts):
(A) such
funds are analyzed, in accordance with the obligor’s mortgage loan
documents, on at least an annual basis, or such other period specified
in
the transaction agreements; (B) interest on such funds is paid, or
credited, to obligors in accordance with applicable mortgage loan
documents and state laws; and (C) such funds are returned to the
obligor
within 30 calendar days of full repayment of the related mortgage
loans,
or such other number of days specified in the transaction
agreements.
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1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax or insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that such
support
has been received by the servicer at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
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1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
E-4
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of days
specified in the transaction agreements.
|
|
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1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
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1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set forth
in
the transaction agreements.
|
Indymac
Bank, F.S.B.,
[SUBSERVICER]
Date:________________________________
By:
_________________________________
Name:
Title:
Name:
Title:
E-5
