PSA SUBSERVICING AGREEMENT
This
PSA
SUBSERVICING AGREEMENT (“Agreement”) is entered into as of the 31st
day of
May, 2006, by and between Popular Mortgage Servicing, Inc., a Delaware
corporation (“Subservicer”) and Equity One, Inc., a Delaware corporation
(“Servicer”).
Background
Servicer
currently services mortgage loans pursuant to the terms of the pooling and
servicing agreements listed on Schedule 1 hereto (collectively, the “Current
PSAs”), which such list includes the Pooling and Servicing Agreement, dated as
of September 30, 2002, relating to the Mortgage Pass-Through Certificates,
Series 2002-5, of Popular ABS, Inc. (the “2002-5 PSA”), by and among Servicer,
as servicer and as a seller, Popular ABS, Inc., as depositor, various direct
and
indirect subsidiaries of Servicer, as sellers, JPMorgan Chase Bank, as trustee,
and the Federal Home Loan Mortgage Corporation (“▇▇▇▇▇▇▇ Mac”), as guarantor
with respect to certain guaranteed certificates (the “Guarantor”). Servicer
wishes to appoint Subservicer as a subservicer under all Current PSAs, including
the ▇▇▇▇-▇ ▇▇▇, and to appoint Subservicer prospectively as the subservicer
under all pooling and servicing agreements it may enter into as servicer after
the Effective Time (as defined below) and under all servicing agreements it
may
enter into after the Effective Time as servicer in connection with the offering
of asset backed securities (collectively, the “Future PSAs”). Current PSAs and
Future PSAs are sometimes referred to herein individually as a “PSA” and
collectively as the “PSAs”.
NOW,
THEREFORE, in consideration of the mutual covenants contained herein and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
Section
1. Appointment
as Subservicer under Pooling and Servicing Agreements.
(a)
Servicer hereby appoints Subservicer as subservicer under each Current PSA,
with
such appointment to become effective at 11:59 p.m. on the date hereof (the
“Effective Time”), and Subservicer hereby accepts such appointment.
(b)
Unless Servicer shall otherwise notify Subservicer in writing with respect
to a
particular Future PSA, Servicer hereby appoints Subservicer as subservicer
under
each Future PSA, with each appointment as subservicer under a particular Future
PSA to take effect automatically, without the need for further action by any
party, immediately upon the effectiveness of the particular Future PSA, and
Subservicer hereby accepts each such appointment. Servicer shall amend Schedule
1 from time to time by using Exhibit A to add PSAs to Schedule 1 which have
been
added to this Agreement by virtue of this Section 1(b) and to delete PSAs from
Schedule 1 which have been deleted from this Agreement pursuant to Section
2.
Servicer’s failure to so amend Schedule 1 shall in no way impair or relieve
Subservicer of its obligations hereunder to service under and in a manner
consistent with a PSA.
(c)
Subservicer’s appointment as subservicer with respect to a particular PSA and
the applicability of this Agreement to a particular PSA shall remain in effect
until Subservicer’s appointment as subservicer under the particular PSA is
terminated.
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Section
2. Termination
of Appointment.
(a)
Subservicer’s appointment as subservicer under the 2002-5 PSA and this
Agreement’s applicability to the 2002-5 PSA shall be terminated upon
Subservicer’s receipt of notification from Servicer, (i) if Subservicer is no
longer an approved ▇▇▇▇▇▇▇ Mac servicer, that Servicer has received a request
for such termination from the Guarantor, or (ii) that Servicer has received
a
reasonable request for such termination from the Guarantor (a “2002-5
Notification”). A termination occurring in accordance with the foregoing
sentence: (i) shall be effective immediately upon receipt by Subservicer of
a
2002-5 Notification or at such later date as shall be specified in the 2002-5
Notification, and (ii) shall be effected without Subservicer charging or
receiving, or being entitled to charge or receive, any termination fees or
transfer expenses from the Trust Fund or Trustee, as such terms are defined
in
the ▇▇▇▇-▇ ▇▇▇.
(b)
Servicer and any successor servicer under a PSA (including without limitation
the Trustee acting in such capacity) shall have the right, exercisable at any
time, to terminate Subservicer’s appointment under this Agreement with respect
to one or more PSAs, and, if required by the terms of a particular PSA, such
termination shall occur without the payment of any fees or other amounts to
the
Subservicer by the successor servicer or any party associated with the
particular PSA. Subservicer and Servicer may terminate this Agreement upon
90
days advance notice to the other party and Subservicer shall cooperate in the
orderly transfer of servicing to a successor servicer or subservicer, as the
case may be.
(c)
Obligations incurred or entitlements earned during the term of this Agreement
shall survive any termination of this Agreement. Provisions of this Agreement
necessary for the enforcement or exercise of rights arising during the
effectiveness, and surviving a termination, of this Agreement shall survive
any
termination of Subservicer’s appointment as subservicer hereunder or a
termination of the applicability of this Agreement to a particular
PSA.
(d)
In
connection with any termination under this Section 2, Subservicer shall perform
such servicing and other activities as the Servicer or successor servicer,
as
the case may be, may reasonably request in connection with the transfer of
servicing. Except as provided otherwise by Section 2(b) and except for
terminations by Servicer following a material breach of this Agreement by
Subservicer, Subservicer shall be entitled to receive from Servicer reasonable
fees for the services so provided.
Section
3. Commencing
at the Effective Time and continuing until Subservicer’s appointment as a
subservicer under a particular PSA is terminated in accordance with Section
2,
Subservicer (i) shall service the mortgage loans contained in each trust created
under a PSA (the “Mortgage Loans”) in a manner consistent with the servicing
arrangement contemplated by the particular PSA, (ii) shall be bound by each
particular PSA, and (iii) shall perform such other services related to the
servicing of mortgage loans as Servicer may reasonably request in connection
with Servicer’s obligations under a particular PSA.
Section
4. Automatic
Amendment.
This
Agreement shall automatically be amended, without further action by any party
of
any nature, to include any provision in a Future PSA which the particular PSA
requires be contained in a subservicing agreement or subservicing
arrangement.
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Section
5. Servicing
Compensation.
(a)
As
compensation for its services rendered hereunder each calendar month with
respect to a particular PSA, Subservicer shall be entitled to an amount equal
to
the Servicing Compensation (as defined in Section 5(b) below) Servicer is
entitled to for such month under the terms of the particular PSA, except that
in
determining such amount (i) prepayment fees and penalties shall be excluded,
and
(ii) a servicing fee rate or amount that the parties shall mutually agree to
in
writing shall be used in place of the servicing fee rate or amount set forth
in
the particular PSA.
(b)
“Servicing Compensation” means the servicing fee provided for in a particular
PSA, reduced in accordance with the terms of the particular PSA, if so required,
plus all other servicing compensation that may be provided for in the particular
PSA, including without limitation all returned check fees, document duplication
charges, property inspection fees, insurance substitution fees, excess proceeds,
prepayment interest excess, assumption fees, late payment charges, and the
net
economic benefit resulting from prepayment balances and balances held in
custodial accounts and escrow accounts, but excluding prepayment fees and
penalties.
(c)
Subservicer may retain the servicing compensation it is entitled to hereunder
from amounts otherwise transferable to Servicer hereunder or in accordance
with
the cash flow and financing arrangements the parties establish in implementation
of this Agreement. If such retained amounts are insufficient to compensate
Subservicer fully for the servicing compensation due hereunder, Servicer shall
pay to Subservicer within 30 days of the end of the calendar month with respect
to which servicing compensation is owed to Subservicer such amounts as to fully
compensate Subservicer hereunder. Servicer shall have the right to audit, and
withhold any disputed portion of, Subservicer’s servicing
compensation.
(d)
This
Section 5 is not intended, not shall it be construed, to require any act or
omission in violation of or in conflict with any PSA and shall be implemented
in
a manner consistent with all terms of each PSA.
Section
6. Indemnification.
Subservicer agrees to indemnify and hold Servicer and each of its directors,
officers, employees and agents and representatives acting on its behalf
(collectively, the “Indemnified Parties”) harmless against any and all claims,
losses, penalties, fines, forfeitures, legal fees and related costs, judgments,
and any other costs, fees and expenses that the Indemnified Parties or any
one
of them may sustain directly or indirectly caused by or arising or resulting
from the negligence or willful misconduct of Subservicer in the performance
of
its obligations hereunder (collectively, a “Claim”). Servicer shall promptly
notify Subservicer if a Claim is made by a third party for which any of the
Indemnified Parties could require indemnification from Subservicer under this
Section 6, and Subservicer shall assume (with the consent of Servicer, which
shall not be unreasonably withheld, and any party that may be required to give
consent pursuant to a PSA) the defense of any such Claim and shall advance
all
expenses in connection therewith, including reasonable counsel fees, and
promptly advance funds to pay, discharge and satisfy any non-appealable, final
judgment or decree which may be entered against an Indemnified Party in respect
of such Claim. Servicer shall not be obligated to provide more than one legal
counsel in defense of any Claim or series of related Claims unless it is advised
by such counsel that conflicts of interest prevent it from representing all
Indemnified Parties to the Claim. The indemnity provided for in this Section
6
shall survive the termination of the Agreement.
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Section
7. Notices.
All
demands, notices and communications required to be provided hereunder shall
be
in writing and shall be deemed to have been duly given if mailed, by registered
or certified mail, postage prepaid, and return receipt requested, or, if by
other means, when received by the other party at the address as
follows:
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If
to Subservicer:
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Popular
Mortgage Servicing, Inc.
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▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
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Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Senior Vice
President
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If
to Servicer:
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Equity
One, Inc.
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▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
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Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
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With
a copy to:
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Popular
Financial Holdings, Inc.
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▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
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Attention:
Counsel
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or
such
other address as may hereafter be furnished to the other party by like notice.
Any such demand, notice or communication hereunder shall be deemed to have
been
received on the date delivered to or received at the premises of the addressee
(as evidenced, in the case of registered or certified mail, by the date noted
on
the return receipt).
Section
8. General
Interpretive Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
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(a)
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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;
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(b)
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accounting
terms not otherwise defined herein have the meanings assigned to
them in
accordance with generally accepted accounting
principles;
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(c)
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references
herein to “Sections,” “Subsections,” “Paragraphs,” and other Subdivisions
without reference to a document are to designated Sections, Subsections,
Paragraphs and other subdivisions of this
Agreement;
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(d)
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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;
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(e)
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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
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(f)
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the
term “include” or “including” shall mean without limitation by reason of
enumeration.
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Section
9. Reproduction
of Documents.
This
Agreement and all documents relating thereto, including, without limitation,
(a)
consents, waivers and modifications which may hereafter be executed, (b)
documents received by any party at the closing, and (c) financial statements,
certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, micro-card, 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.
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Section
10. Further
Agreements.
The
Subservicer shall execute and deliver to the Servicer and the Servicer shall
execute and deliver to the Subservicer such reasonable and appropriate
additional documents, instruments or agreements as may be necessary or
appropriate to effectuate the purposes of this Agreement.
Section
11. Execution
of Agreement.
This
Agreement may be executed simultaneously or in any number of counterparts.
Each
counterpart shall be deemed to be an original, and all of which together shall
constitute one and the same instrument. The parties agree that this Agreement
and any notices hereunder may be transmitted between them by email and/or by
facsimile. The parties intend that faxed signatures and electronically imaged
signatures such as .pdf files shall constitute original signatures and are
binding on all parties. The original documents shall be promptly delivered,
if
requested.
Section
12. Successors
and Assigns.
This
Agreement shall bind and inure to the benefit of and be enforceable by the
Subservicer and the Servicer and the respective permitted successors and assigns
of the Subservicer and the permitted successors and assigns of the Servicer.
This Agreement may not be assigned, pledged, hypothecated or otherwise
encumbered by either party hereto, in whole or in part, without the prior
written consent of the other party, and any such attempted action by either
party without the other party’s prior written consent shall be considered null
and void.
Section
13. Severability
Clause.
Any
part, provision, representation or warranty of this Agreement which is
prohibited or which is held to be void or unenforceable shall be ineffective
to
the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof. Any part, provision, representation or warranty
of
this Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any relevant jurisdiction shall be ineffective, as to such
jurisdiction, to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction as to any Mortgage Loan shall not
invalidate or render unenforceable such provision in any other jurisdiction.
To
the extent permitted by applicable law, the parties hereto waive any provision
of law which prohibits or renders void or unenforceable any provision
hereof.
Section
14. Governing
Law.
This
agreement shall be governed by, and construed in accordance with, the laws
of
the state of New Jersey,
without
giving effect to New Jersey’s principles of conflicts of laws.
Section
15. Entire
Agreement.
This
Agreement constitutes the entire understanding between the parties hereto with
respect to the subject matter hereof and supersedes any and all prior or
contemporaneous oral or written communications with respect to the same. This
Agreement may be modified or amended or by an instrument in writing signed
by
both the parties hereto.
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IN
WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year
first written above.
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Equity
One, Inc.
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Popular
Mortgage Servicing, Inc.
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By:
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/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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By:
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/s/
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
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▇▇▇▇
▇. ▇▇▇▇▇▇▇▇
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President
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President
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Schedule
1 - Pooling and Servicing Agreements
(as
of
May 31, 2006)
Popular
ABS, Inc., Mortgage Pass-Through Certificates:
Series
1997-1
Series
1998-1
Series
1999-1
Series
2000-1
Series
2001-1
Series
2001-2
Series
2001-3
Series
2002-1
Series
2002-2
Series
2002-3
Series
2002-4
Series
2002-5
Series
2003-1
Series
2003-2
Series
2003-3
Series
2003-4
Series
2004-1
Series
2004-2
Series
2004-3
Series
2004-4
Series
2004-5
Series
2005-1
Series
2005-2
Series
2005-3
Series
2005-4
Series
2005-5
Series
2005-6
Series
2005-A
Series
2005-B
Series
2005-C
Series
2005-D
Series
2006-A
Series
2006-B
Nomura
Home Equity Loan, Inc., Asset-Backed Certificates, Series 2006-FM1
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EXHIBIT
A
Schedule
1 - Pooling and Servicing Agreements
Popular
ABS, Inc., Mortgage Pass-Through Certificates:
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Series
1998-1
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Series
2004-3
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Series
1999-1
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Series
2004-4
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Series
2000-1
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Series
2004-5
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Series
2001-1
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Series
2005-1
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Series
2001-2
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Series
2005-2
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Series
2001-3
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Series
2005-3
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Series
2002-1
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Series
2005-4
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Series
2002-2
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Series
2005-5
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Series
2002-3
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Series
2005-6
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Series
2002-4
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Series
2005-A
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Series
2002-5
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Series
2005-B
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Series
2003-1
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Series
2005-C
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Series
2003-2
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Series
2005-D
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Series
2003-3
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Series
2006-A
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Series
2003-4
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Series
2006-B
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Series
2004-1
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Series
2006-C
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Series
2004-2
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Series
2006-D
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Nomura
Home Equity Loan, Inc., Asset-Backed Certificates, Series 2006-FM1
Equity
One, Inc.
By:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Name:
▇▇▇▇▇▇ ▇▇▇▇▇▇
Title:
Senior Vice President
Date:
September 28, 2006
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