Exhibit 99.5
EXECUTION
RECONSTITUTED SERVICING AGREEMENT
THIS RECONSTITUTED SERVICING AGREEMENT (this "Agreement"), entered
into as of the 1st day of October 2000, by and between LEHMAN CAPITAL, A
DIVISION OF LEHMAN BROTHERS HOLDINGS INC., a Delaware corporation ("Lehman
Capital"), and WELLS FARGO HOME MORTGAGE, INC.(the "Servicer") having an
office at 1 Home Campus, Des Moines, Iowa 50328-0001, recites and provides as
follows:
RECITALS
WHEREAS, Centre Capital Group, Inc. ("CCGI") acquired certain first
lien, fixed and adjustable rate, conventional mortgage loans on a
servicing-retained basis from the Servicer, which mortgage loans were either
originated or acquired by the Servicer.
WHEREAS, such mortgage loans are currently being serviced by the
Servicer for CCGI pursuant to a Master Servicing Agreement for Fixed and
Adjustable Rate Mortgage Loans (the "Master Servicing Agreement"), dated as of
May 25, 2000 and annexed as Exhibit B hereto, by and between CCGI, as owner,
and the Servicer, as servicer.
WHEREAS, pursuant to an Assignment and Assumption Agreement, dated as
of June 14, 2000 (the "Assignment and Assumption Agreement") and annexed as
Exhibit C hereto, Lehman Capital acquired from CCGI all of CCGI's right, title
and interest in and to certain of the mortgage loans currently serviced under
the Master Servicing Agreement (hereinafter, the "Mortgage Loans") and assumed
for the benefit of each of the Servicer and CCGI the obligations of CCGI as
owner under such Agreement.
WHEREAS, Lehman Capital has conveyed certain of the Mortgage Loans,
as identified on Schedule I hereto (the "Serviced Mortgage Loans"), to
Structured Asset Securities Corporation, a Delaware special purpose
corporation ("SASCO"), which in turn has conveyed the Serviced Mortgage Loans
to Wells Fargo Bank Minnesota, N.A. (the "Trustee"), pursuant to a trust
agreement dated as of October 1, 2000 (the "Trust Agreement"), among the
Trustee, Aurora Loan Services Inc., as master servicer ("Aurora," and,
together with any successor Master Servicer appointed pursuant to the
provisions of the Trust Agreement, the "Master Servicer") and SASCO.
WHEREAS, Lehman Capital desires that the Servicer continue to service
the Serviced Mortgage Loans, and the Servicer has agreed to do so, subject to
the rights of Lehman Capital (with the consent of the Master Servicer) to
terminate the rights and obligations of the Servicer hereunder at any time
without cause and to the other conditions set forth herein.
WHEREAS, Lehman Capital and the Servicer agree that the provisions of
the Master Servicing Agreement shall continue to apply to the Serviced
Mortgage Loans, but only to the extent provided herein and that this Agreement
shall constitute a Reconstitution Agreement (as such term is defined in the
Master Servicing Agreement) which shall govern the Serviced Mortgage Loans for
so long as such Serviced Mortgage Loans remain subject to the provisions of
the Trust Agreement.
WHEREAS, the Master Servicer and any successor master servicer shall
be obligated, among other things, to supervise the servicing of the Serviced
Mortgage Loans on behalf of the Trustee, and shall have the right under the
conditions specified herein to terminate for cause the rights and obligations
of the Servicer under this Agreement.
WHEREAS, Lehman Capital and the Servicer intend that each of the
Master Servicer and the Trustee is an intended third party beneficiary of this
Agreement.
NOW, THEREFORE, in consideration of the mutual agreements hereinafter
set forth and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Lehman Capital and the Servicer
hereby agree as follows:
AGREEMENT
1. Definitions. Capitalized terms used and not defined in this
Agreement, including Exhibit A hereto and any provisions of the Master
Servicing Agreement incorporated by reference herein (regardless of whether
such terms are defined in the Master Servicing Agreement), shall have the
meanings ascribed to such terms in the Trust Agreement.
2. Servicing. The Servicer agrees, with respect to the Serviced
Mortgage Loans, to perform and observe the duties, responsibilities and
obligations that are to be performed and observed under the provisions of the
Master Servicing Agreement, except as otherwise provided herein and on Exhibit
A hereto, and that the provisions of the Master Servicing Agreement, as so
modified, are and shall be a part of this Agreement to the same extent as if
set forth herein in full.
3. Master Servicing; Termination of Servicer. The Servicer, including
any successor servicer hereunder, shall be subject to the supervision of the
Master Servicer, which Master Servicer shall be obligated to ensure that the
Servicer services the Serviced Mortgage Loans in accordance with the
provisions of this Agreement. The Master Servicer, acting on behalf of the
Trustee and the SASCO 2000-4 Trust Fund (the "Trust Fund") created pursuant to
the Trust Agreement, shall have the same rights as Lehman Capital, as owner,
under the Master Servicing Agreement to enforce the obligations of the
Servicer under the Master Servicing Agreement and the term "Owner" as used in
the Master Servicing Agreement in connection with any rights of the Owner
shall refer to the Trust Fund or, as the context requires, the Master Servicer
acting in its capacity as agent for the Trust Fund, except as otherwise
specified in Exhibit A hereto. The Master Servicer shall be entitled to
terminate the rights and obligations of the Servicer under this Agreement upon
the failure of the Servicer to perform any of its obligations under this
Agreement, which failure results in an Event of Default as provided in Article
IX of the Master Servicing Agreement. Notwithstanding anything herein to the
contrary, in no event shall the Master Servicer assume any of the obligations
of Lehman Capital under the Master Servicing Agreement; and in connection with
the performance of the Master Servicer's duties hereunder the parties and
other signatories hereto agree that the Master Servicer shall be entitled to
all of the rights, protections and limitations of liability afforded to the
Master Servicer under the Trust Agreement.
4. No Representations. Neither the Servicer nor the Master Servicer
shall be obligated or required to make any representations and warranties
regarding the characteristics of the Serviced Mortgage Loans in connection
with the transactions contemplated by the Trust Agreement and issuance of the
Certificates issued pursuant thereto.
5. Notices. All notices and communications between or among the
parties hereto (including any third party beneficiary thereof) or required to
be provided to the Trustee shall be in writing and shall be deemed received or
given when mailed first-class mail, postage prepaid, addressed to each other
party at its address specified below or, if sent by facsimile or electronic
mail, when facsimile or electronic confirmation of receipt by the recipient is
received by the sender of such notice. Each party may designate to the other
parties in writing, from time to time, other addresses to which notices and
communications hereunder shall be sent.
All notices required to be delivered to the Master Servicer under
this Agreement shall be delivered to the Master Servicer at the following
address:
Aurora Loan Services Inc.
2530 South Parker Road
Suite 601
Aurora, Colorado 80014
Attention: E. Todd Whittemore, Master Servicing, SASCO/ALS 2000-4
Telephone: (303) 632-3000
Telecopier: (303) 632-3001
All remittances required to be made to the Master Servicer under this
Agreement shall be made on a scheduled/scheduled basis to the following wire
account:
The Chase Manhattan Bank
New York, New York
ABA#: 021-000-021
Account Name: Aurora Loan Services Inc., Master Servicing Payment
Clearing Account
Account No.: 066-611059
Beneficiary: Aurora Loan Services Inc.
For further credit to: SASCO/ALS 2000-4
All notices required to be delivered to the Trustee hereunder shall
be delivered to the Trustee at the following address:
Wells Fargo Bank Minnesota, N.A.
11000 Broken Land Parkway
Columbia, Maryland 21044
Attention: Corporate Trust Services
Telephone: (410) 884-2136
Telecopier: (410) 884-2363
All notices required to be delivered to Lehman Capital hereunder
shall be delivered to Lehman Capital at the following address:
Lehman Capital, a Division of Lehman
Brothers Holdings Inc.
200 Vesey Street
New York, New York 10285-0900
Attention: Mortgage Backed Finance Department
Telephone: (212) 526-7000
Telecopier: (212) 526-7209
All notices required to be delivered to the Servicer hereunder shall
be delivered to the address of its office as set forth in the first paragraph
of this Agreement.
6. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, NOTWITHSTANDING NEW
YORK OR OTHER CHOICE OF LAW RULES TO THE CONTRARY.
7. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an
original, but all of which counterparts shall together constitute but one and
the same instrument.
8. Reconstitution. Lehman Capital and the Servicer agree that this
Agreement is a "Reconstitution Agreement" and that the date hereof is the
"Reconstitution Date", each as defined in the Master Servicing Agreement.
<PAGE>
Executed as of the day and year first above written.
LEHMAN CAPITAL, A DIVISION OF
LEHMAN BROTHERS HOLDINGS INC.,
as Owner
By:/s/ Joseph J. Kelly
--------------------------------
Name: Joseph J. Kelly
Title: Authorized Signatory
WELLS FARGO HOME MORTGAGE, INC.,
as Servicer
By:/s/ Trisha Ruseski
-------------------------------
Name: Trisha Ruseski
Title: Vice President
Acknowledged By:
AURORA LOAN SERVICES INC.,
as Master Servicer
By:/s/ Ralph A. Lenzi, III
---------------------------------
Name: Ralph A. Lenzi, III
Title: CEO
WELLS FARGO BANK MINNESOTA, N.A.,
as Trustee
By:/s/ Randall S. Reider
---------------------------------
Name: Randall S. Reider
Title: Assistant Vice President
<PAGE>
EXHIBIT A
Modifications to the Master Servicing Agreement
1. Unless otherwise specified herein, any provisions of the Master
Servicing Agreement, including definitions, relating to (i)
representations and warranties of the Owner and (ii) Whole-Loan
Transfers, Pass-Through Transfers, Acknowledgement Agreements,
Closing Dates, Cut-off Dates and First Remittance Dates shall be
disregarded. Unless otherwise specified herein, for purposes of this
Agreement, the exhibits to the Master Servicing Agreement and all
references to such exhibits shall also be disregarded.
2. The definition of "Custodial Agreement" in Article I is hereby amended
in its entirety to read as follows:
"Custodial Agreement" means the Trust Agreement.
3. The definition of "Custodian" in Article I is hereby amended in its
entirety to read as follows:
"Custodian" means Wells Fargo Bank Minnesota, N.A., any
successor in interest or any successor custodian appointed
pursuant to the Custodial Agreement.
4. The definition of "Eligible Investments" in Article I is hereby
amended in its entirety to read as follows:
"Eligible Investments": Any one or more of the obligations
and securities listed below which investment provides for a
date of maturity not later than the Determination Date in
each month:
(i) direct obligations of, and obligations fully
guaranteed as to timely payment of principal and interest
by, the United States of America or any agency or
instrumentality of the United States of America the
obligations of which are backed by the full faith and
credit of the United States of America ("Direct
Obligations");
(ii) federal funds, or demand and time deposits in,
certificates of deposits of, or bankers' acceptances
issued by, any depository institution or trust company
(including U.S. subsidiaries of foreign depositories and
the Trustee or any agent of the Trustee, acting in its
respective commercial capacity) incorporated or organized
under the laws of the United States of America or any
state thereof and subject to supervision and examination
by federal or state banking authorities, so long as at the
time of investment or the contractual commitment providing
for such investment the commercial paper or other
short-term debt obligations of such depository institution
or trust company (or, in the case of a depository
institution or trust company which is the principal
subsidiary of a holding company, the commercial paper or
other short-term debt or deposit obligations of such
holding company or deposit institution, as the case may
be) have been rated by each Rating Agency in its highest
short-term rating category or one of its two highest
long-term rating categories;
(iii) repurchase agreements collateralized by Direct
Obligations or securities guaranteed by GNMA, Fannie Mae
or Freddie Mac with any registered broker/dealer subject
to Securities Investors' Protection Corporation
jurisdiction or any commercial bank insured by the FDIC,
if such broker/dealer or bank has an uninsured, unsecured
and unguaranteed obligation rated by each Rating Agency in
its highest short-term rating category;
(iv) securities bearing interest or sold at a
discount issued by any corporation incorporated under the
laws of the United States of America or any state thereof
which have a credit rating from each Rating Agency, at the
time of investment or the contractual commitment providing
for such investment, at least equal to one of the two
highest long-term credit rating categories of each Rating
Agency; provided, however, that securities issued by any
particular corporation will not be Eligible Investments to
the extent that investment therein will cause the then
outstanding principal amount of securities issued by such
corporation and held as part of the Trust Fund to exceed
20% of the sum of the aggregate principal balance of the
Mortgage Loans; provided, further, that such securities
will not be Eligible Investments if they are published as
being under review with negative implications from either
Rating Agency;
(v) commercial paper (including both
non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a
specified date not more than 180 days after the date of
issuance thereof) rated by each Rating Agency in its
highest short-term rating category;
(vi) a Qualified GIC;
(vii) certificates or receipts representing direct
ownership interests in future interest or principal
payments on obligations of the United States of America or
its agencies or instrumentalities (which obligations are
backed by the full faith and credit of the United States
of America) held by a custodian in safekeeping on behalf
of the holders of such receipts; and
(viii) any other demand, money market, common trust
fund or time deposit or obligation, or interest-bearing or
other security or investment, (A) rated in the highest
rating category by each Rating Agency or (B) that would
not adversely affect the then current rating by each
Rating Agency of any of the Certificates. Such investments
in this subsection (viii) may include money market mutual
funds or common trust funds, including any fund for which
the Trustee, the Master Servicer or an affiliate thereof
serves as an investment advisor, administrator,
shareholder servicing agent, and/or custodian or
subcustodian, notwithstanding that (x) the Trustee, the
Master Servicer or an affiliate thereof charges and
collects fees and expenses from such funds for services
rendered, (y) the Trustee, the Master Servicer or an
affiliate thereof charges and collects fees and expenses
for services rendered pursuant to this Agreement, and (z)
services performed for such funds and pursuant to this
Agreement may converge at any time, provided, however,
that no such instrument shall be an Eligible Investment if
such instrument evidences either (i) a right to receive
only interest payments with respect to the obligations
underlying such instrument, or (ii) both principal and
interest payments derived from obligations underlying such
instrument and the principal and interest payments with
respect to such instrument provide a yield to maturity of
greater than 120% of the yield to maturity at par of such
underlying obligations.
5. The definition of "GNMA" is hereby added to Article I to immediately
follow the definition of "Freddie Mac":
"GNMA": The Government National Mortgage Association, or
any successor thereto.
6. The definition of "Monthly Advance" in Article I is hereby amended in
its entirety to read as follows:
"Monthly Advance" means with respect to each Remittance Date
and each Mortgage Loan, an amount equal to the Monthly
Payment (with the interest portion of such Monthly Payment
adjusted to the Mortgage Loan Remittance Rate) that was due
on the Mortgage Loan, and that (i) was delinquent at the
close of business on the related Determination Date and (ii)
was not the subject of a previous Monthly Advance, but only
to the extent that such amount is expected, in the
reasonable judgment of the Servicer, to be recoverable from
collections or other recoveries in respect of such Mortgage
Loan. To the extent that the Servicer determines that any
such amount is not recoverable from collections or other
recoveries in respect of such Mortgage Loan, such
determination shall be evidenced by a certificate of a
Servicing Officer delivered to the Master Servicer setting
forth such determination and the procedures and
considerations of the Servicer forming the basis of such
determination, which shall include a copy of any broker's
price opinion and any other information or reports obtained
by the Servicer which may support such determinations.
7. The definition of "Mortgage Loan" in Article I is hereby amended in
its entirety to read as follows:
"Mortgage Loan": An individual servicing retained Mortgage
Loan which has been assigned by CCGI to Lehman Capital
pursuant to the Assignment and Assumption Agreement and is
subject to this Agreement being identified on the Mortgage
Loan Schedule to this Agreement, which Mortgage Loan
includes without limitation the Mortgage Loan documents, the
Monthly Reports, Principal Prepayments, Liquidation
Proceeds, Condemnation Proceeds, Insurance Proceeds, REO
Disposition Proceeds and all other rights, benefits,
proceeds and obligations arising from or in connection with
such Mortgage Loan.
8. The definition of "Mortgage Loan Schedule" in Article I is hereby
amended in its entirety to read as follows:
"Mortgage Loan Schedule": The schedule of Mortgage Loans
setting forth certain information with respect to the
Mortgage Loans which were acquired by Lehman Capital
pursuant to the Assignment and Assumption Agreement, which
Mortgage Loan Schedule is attached as Exhibit D to this
Agreement.
9. The definition of "Opinion of Counsel" in Article I is hereby amended
by adding the following proviso at the end of such definition:
provided that any Opinion of Counsel relating to (a)
qualification of the Mortgage Loans in a REMIC or (b)
compliance with the REMIC Provisions, must be an opinion of
counsel who (i) is in fact independent of the Servicer and
the Master Servicer of the Mortgage Loans, (ii) does not
have any material direct or indirect financial interest in
the Servicer or the Master Servicer of the Mortgage Loans or
in an affiliate of either and (iii) is not connected with
the Servicer or the Master Servicer of the Mortgage Loans as
an officer, employee, director or person performing similar
functions. The cost of any such Opinion of Counsel shall be
an expense of the Trust Fund unless Lehman Capital decides,
in its own discretion, to bear such expense for the Trust
Fund, in which case such cost will be borne by Lehman
Capital.
10. The definition of "Prepayment Interest Shortfall Amount" in Article I
is hereby amended by inserting the words (i) "voluntary (not
including discounted payoffs)" between the words "a" and "Principal"
in the second line thereof, (ii) "or in part" between the words
"full" and "during" in the second line thereof and (iii) "for
Principal Prepayments in full only" at the end of the parenthetical
appearing in the fifth line thereof.
11. The definition of "Qualified Depository" is hereby amended and
restated in its entirety to read as follows:
"Qualified Depository": Any of (i) a depository the accounts
of which are insured by the FDIC and the debt obligations of
which are rated A-1 (or its equivalent) or better by each
Rating Agency; (ii) the corporate trust department of any
bank the debt obligations of which are rated at least A-1 or
its equivalent by each Rating Agency; or (iii) Lehman
Brothers Bank, F.S.B., a federal savings bank.
12. The definition of "Qualified GIC" is hereby added to Article I to
immediately follow the definition of "Qualified Depository", to read
as follows:
"Qualified GIC": A guaranteed investment contract or surety
bond providing for the investment of funds in the Custodial
Account and insuring a minimum, fixed or floating rate of
return on investments of such funds, which contract or
surety bond shall:
(a) be an obligation of an insurance company or
other corporation whose long-term debt is rated by each
Rating Agency in one of its two highest rating categories
or, if such insurance company has no long-term debt, whose
claims paying ability is rated by each Rating Agency in one
of its two highest rating categories, and whose short-term
debt is rated by each Rating Agency in its highest rating
category;
(b) provide that the Servicer may exercise all of
the rights under such contract or surety bond without the
necessity of taking any action by any other Person;
(c) provide that if at any time the then current
credit standing of the obligor under such guaranteed
investment contract is such that continued investment
pursuant to such contract of funds would result in a
downgrading of any rating of the Servicer, the Servicer
shall terminate such contract without penalty and be
entitled to the return of all funds previously invested
thereunder, together with accrued interest thereon at the
interest rate provided under such contract to the date of
delivery of such funds to the Trustee;
(d) provide that the Servicer's interest therein
shall be transferable to any successor Servicer or the Master
Servicer hereunder; and
(e) provide that the funds reinvested thereunder
and accrued interest thereon be returnable to the Custodial
Account, as the case may be, not later than the Business Day
prior to any Determination Date.
13. The definition of "Servicing Fee" in Article I is hereby amended in
its entirety to read as follows:
"Servicing Fee": An amount equal to one-twelfth the product
of (a) the Servicing Fee Rate and (b) the outstanding
principal balance of the Mortgage Loan. The Servicing Fee is
payable solely from the interest portion (including
recoveries with respect to interest from Liquidation
Proceeds, Condemnation Proceeds, Insurance Proceeds and REO
Disposition Proceeds) of such Monthly Payment collected by
the Servicer or as otherwise provided under this Agreement.
14. The parties hereto acknowledge that Section 2.02 (Books and Records)
of the Master Servicing Agreement shall be modified to indicate that
the Servicer shall prepare and execute at the direction of Lehman
Capital any note endorsements in connection with transfer of the
Mortgage Loans to the Trust Fund as the Owner of the Mortgage Loans
and that Lehman Capital shall pay for any fees associated with the
preparation and execution of such note endorsements to the Trust
Fund.
15. The parties hereto acknowledge that Section 2.03 (Commencement of
Servicing Responsibilities) shall be inapplicable to this Agreement.
16. The parties hereto acknowledge that Section 2.04 (Custodial
Agreement) shall be inapplicable to this Agreement, as superseded by
the provisions of the Custodial Agreement and the Trust Agreement.
17. The parties hereto acknowledge that references to the "Owner" in the
second and third paragraphs of Section 3.02 shall refer to the Master
Servicer, except that the expense of any environmental inspection or
review at the request of the Master Servicer shall be an expense of
the Trust Fund.
18. The parties hereto acknowledge that the (i) reference to "Centre
Capital Group, Inc., owner of Fixed and Adjustable Rate Mortgage
Loans" in the fourth line of the first paragraph of Section 3.04
shall be to the "SASCO 2000-4 Trust Fund" and (ii) reference to
"Cut-off Date" in the second paragraph of Section 3.04 shall mean the
"close of business on October 1, 2000."
19. Section 3.06 (Establishment of and Deposits to Escrow Account) is
hereby amended by changing the words "Wells Fargo Home Mortgage, Inc.
in trust for Centre Capital Group, Inc." appearing in the fourth and
fifth lines of the first paragraph thereof to "Wells Fargo Home
Mortgage, Inc. in trust for the SASCO 2000-4 Trust Fund."
20. Section 4.02 (Statements to Owner) is hereby amended by (i) replacing
the reference to "Remittance Date" in the first paragraph of such
section with "tenth calendar day of each month," and (ii) designating
the last paragraph of such section as paragraph (c) and by adding the
following paragraph (d) to such Section to read as follows:
(d) The Monthly Remittance Advice shall also
include on a current and cumulative basis the amount of any
(i) claims filed, (ii) claim payments made, (iii) claims
denied and (iv) policies cancelled with respect to those
Serviced Mortgage Loans covered by any PMI Policy or LPMI
Policy.
21. Section 4.03 (Monthly Advances by Servicer) is hereby amended by
changing the word "Company" to "Servicer" and the word "Purchaser" to
"Trust Fund" in the second sentence of such section.
22. Section 5.01 (Servicing Compensation) is hereby amended by adding the
following sentences at the end of such Section:
The aggregate of the Servicing Fees payable to the
Servicer for any month with respect to the Mortgage Loans
shall be reduced by any Prepayment Interest Shortfall Amount
with respect to such month, but in no event shall the
Servicer be obligated to pay with respect to any Prepayment
Period any Prepayment Interest Shortfall in excess of its
Servicing Fee earned in respect of the related Due Period.
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 thereof
except as specifically provided for herein.
23. Section 5.06 (Annual Independent Public Accountants Servicing Report)
is hereby amended and restated in its entirety to read as follows:
Section 5.06 Annual Audit Report.
On or before July 31 of each year, beginning with
July 31, 2001, Servicer shall, at its own expense, cause a
firm of independent public accountants (who may also render
other services to Servicer), which is a member of the
American Institute of Certified Public Accountants, to
furnish to the Master Servicer (i) year-end audited (if
available) financial statements of the Servicer and (ii) a
statement to the effect that such firm has examined certain
documents and records for the preceding fiscal year (or
during the period from the date of commencement of such
Servicer's duties hereunder until the end of such preceding
fiscal year in the case of the first such certificate) and
that, on the basis of such examination conducted
substantially in compliance with the Uniform Single
Attestation Program for Mortgage Bankers, such firm is of
the opinion that Servicer's overall servicing operations
have been conducted in compliance with the Uniform Single
Attestation Program for Mortgage Bankers except for such
exceptions that, in the opinion of such firm, the Uniform
Single Attestation Program for Mortgage Bankers requires it
to report, in which case such exceptions shall be set forth
in such statement. At the request of Lehman Capital, the
Master Servicer shall deliver such documents to Lehman
Capital within three (3) days of receipt thereof.
24. A new Section 5.07 is added to the Master Servicing Agreement to read
as follows:
Section 5.07 Annual Officer's Certificate.
On or before July 31st of each year, beginning with
July 31, 2001, the Servicer, at its own expense, will
deliver to the Master Servicer a Servicing Officer's
certificate stating, as to each signer thereof, that (i) a
review of the activities of the Servicer during such
preceding fiscal year and of performance under this
Agreement or similar agreement has been made under such
officers' supervision, and (ii) to the best of such
officers' knowledge, based on such review, the Servicer has
fulfilled all its obligations under this Agreement or
similar agreements for such year, or, if there has been a
default in the fulfillment of all such obligations,
specifying each such default known to such officer and the
nature and status thereof including the steps being taken by
the Servicer to remedy such default. At the request of
Lehman Capital, the Master Servicer shall deliver such
certificate to Lehman Capital within three (3) days of
receipt thereof.
25. The second, third and fourth paragraphs of Section 6.02 (Remedies for
Breach of Representations and Warranties of the Servicer) are hereby
restated to read as follows:
Within 60 days of the earlier of either discovery
by or notice to the Servicer of any breach of a
representation or warranty set forth in Section 6.01 which
materially and adversely affects the ability of the Servicer
to perform its duties and obligations under this Agreement
or otherwise materially and adversely affects the value of
the Mortgage Loans, the Mortgaged Property or the priority
of the security interest on such Mortgaged Property, the
Servicer shall use its best efforts promptly to cure such
Breach in all material respects and, if such Breach cannot
be cured, the Servicer shall, at the Trustee's option,
assign the Servicer's rights and obligations under this
Agreement (or respecting the affected Mortgage Loans) to a
successor Servicer selected by the Trustee with the prior
consent and approval of the Master Servicer. Such assignment
shall be made in accordance with Section 10.01.
In addition, the Servicer shall indemnify (from its
own funds) the Trustee, the Trust Fund and the Master
Servicer and hold each of them harmless against any costs
resulting from any claim, demand, defense or assertion based
on or grounded upon, or resulting from, a Breach of the
Servicer's representations and warranties contained in this
Agreement. It is understood and agreed that the remedies set
forth in this Section 6.02 constitute the sole remedies of
the Master Servicer, the Trust Fund and the Trustee
respecting a breach of the foregoing representations and
warranties.
Any cause of action against the Servicer relating
to or arising out of the Breach of any representations and
warranties made in Section 6.01 shall accrue upon (i)
discovery of such Breach by the Servicer or notice thereof
by the Trustee or Master Servicer to the Servicer, (ii)
failure by the Servicer to cure such breach within the
applicable cure period, and (iii) demand upon the Servicer
by the Trustee or the Master Servicer for compliance with
this Agreement.
26. The parties hereto acknowledge that Section 6.03 (Representations and
Warranties of the Owner), Section 6.04 (Remedies for Breach of
Representations and Warranties of Owner) Section 7.01 (Removal of
Mortgage Loans from Inclusion Under the Agreement Upon a Pass-Through
Transfer or a Whole Loan Transfer on One or More Reconstitution
Dates) and Section 7.02 (Owner's Repurchase and Indemnification
Obligation) are inapplicable to this Agreement.
27. Section 7.03 (Indemnification; Third Party Claims) is hereby amended
in its entirety to read as follows:
The Servicer shall indemnify the Trust Fund, the
Trustee and the Master Servicer and hold each of them
harmless against any and all claims, losses, damages,
penalties, fines, forfeitures, reasonable and necessary
legal fees and related costs, judgements, and any other
costs, fees and expenses that any of such parties may
sustain in any way related to the failure of the Servicer to
perform its duties and service the Mortgage Loans in strict
compliance with the terms of this Agreement. The Servicer
immediately shall notify Lehman Capital, the Master Servicer
and the Trustee or any other relevant party if a claim is
made by a third party with respect to this Agreement or the
Mortgage Loans, assume (with the prior written consent of
the indemnified party) the defense of any such claim and pay
all expenses in connection therewith, including counsel
fees, and promptly pay, discharge and satisfy any judgement
or decree which may be entered against it or any of such
parties in respect of such claim. The Servicer shall follow
any written instructions received from the Trustee in
connection with such claim. The Trustee from the assets of
the Trust Fund promptly shall reimburse the Servicer for all
amounts advanced by it pursuant to the preceding sentence
except when the claim is in any way related to the
Servicer's indemnification pursuant to Section 6.02, or the
failure of the Servicer to service and administer the
Mortgage Loans in strict compliance with the terms of this
Agreement.
The Trust Fund shall indemnify the Servicer and
hold it harmless against any and all claims, losses,
damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments, and any
other costs, fees and expenses that the Servicer may sustain
in any way related to the failure of the Trustee or the
Master Servicer to perform its duties in compliance with the
terms of this Agreement.
In the event a dispute arises between an
indemnified party and the Servicer with respect to any of
the rights and obligations of the parties pursuant to this
Agreement and such dispute is adjudicated in a court of law,
by an arbitration panel or any other judicial process, then
the losing party shall indemnify and reimburse the winning
party for all attorney's fees and other costs and expenses
related to the adjudication of said dispute.
28. Section 8.02 is hereby amended by changing the word "Owner" to
"Trustee" where it appears in the proviso to the third sentence
thereof and the word "Owner" to "Trust Fund" in the fifth sentence of
such Section.
29. The first paragraph of Section 8.03 (Limitation on Resignation and
Assignment by Servicer) is hereby amended in its entirety to read as
follows:
The Servicer shall neither assign this Agreement or
the servicing hereunder or delegate its rights or duties
hereunder or any portion hereof (to other than a third party
in the case of outsourcing routine tasks such as taxes,
insurance and property inspection, in which case the
Servicer shall fully liable for such tasks as if the
Servicer performed them itself) or sell or otherwise dispose
of all or substantially all of its property or assets
without the prior written consent of the Trustee and the
Master Servicer, which consent shall be granted or withheld
in the reasonable discretion of such parties, provided,
however, that the Servicer may assign its rights and
obligations hereunder without prior written consent of the
Trustee and the Master Servicer to any entity that is
directly owned or controlled by the Servicer, and the
Servicer guarantees the performance of such entity
hereunder. In the event of such assignment by the Servicer,
the Servicer shall provide the Trustee and the Master
Servicer with a written statement guaranteeing the successor
entity's performance of the Servicer's obligations under the
Agreement.
References to "Owner" in the second and third paragraph of Section
8.03 shall refer to the "Master Servicer, at the direction, or with the prior
approval of, the Trustee".
30. Section 9.01 is hereby amended by changing the references to "Owner"
in the third and fourth paragraph of such section to "Master
Servicer."
31. Section 9.02 (Termination Without Cause) is hereby amended in its
entirety to read as follows:
Section 9.02 Termination Without Cause.
This Agreement shall terminate upon: (i) the later
of (a) the distribution of the final payment or liquidation
proceeds on the last Mortgage Loan to the Owner (or advances
by the Servicer for the same), and (b) the disposition of
all REO Property acquired upon foreclosure of the last
Mortgage Loan and the remittance of all funds due hereunder,
or (ii) mutual consent of the Servicer, Lehman Capital and
the Master Servicer in writing or (iii) at the sole option
of the Lehman Capital, without cause, upon 30 days written
notice. Any such notice of termination shall be in writing
and delivered to the Servicer by registered mail to the
address set forth at the beginning of this Agreement. The
Master Servicer, the Trustee and the Servicer shall comply
with the termination procedures set forth in Sections 10.01
and 10.03 hereof and the procedures set forth below,
provided that, in the event Lehman Capital terminates this
Agreement without cause in accordance with subclause (iii)
above, Lehman Capital shall pay the Servicer a termination
fee equal to 2.0% of the aggregate unpaid balance of the
Mortgage Loans as of such termination date.
In connection with any such termination referred to
in clause (ii) or (iii) above, Lehman Capital will be
responsible for reimbursing the Servicer for all
unreimbursed out-of-pocket Servicing Advances within 15
Business Days following the date of termination and other
reasonable and necessary out-of-pocket costs associated with
any transfer of servicing.
Notwithstanding and in addition to the foregoing,
in the event that (i) a Mortgage Loan becomes delinquent for
a period of 91 days or more and not in foreclosure,
bankruptcy, or actively participating in a repayment plan (a
"Delinquent Mortgage Loan") or (ii) a Mortgage Loan becomes
an REO Property, Lehman Capital may at its election
terminate this Agreement (a) with respect to such Delinquent
Mortgage Loan or (b) REO Property, in each case, upon 15
days' written notice to the Servicer. Notwithstanding, the
prior sentence, any Mortgage Loan referred to foreclosure as
of a Notice Date or in the month of the transfer shall be
considered a Delinquent Mortgage Loan. In the event of such
election, Lehman Capital shall reimburse the Servicer for
all unreimbursed out-of-pocket Servicing Advances and
Monthly Advances on the date of termination and other
reasonable and necessary out-of-pocket costs associated with
any transfer of servicing, including, but not limited to,
costs associated with the transfer of the related files to
the Lehman Capital's designee. The servicing for such
Delinquent Mortgage Loan or REO Property shall be
transferred by the Servicer to Lehman Capital within a
reasonable period of time after such written notice of
termination is given by Lehman Capital, but in no event more
than 30 days of the receipt of such notice.
32. Section 10.01 (Successor to the Servicer) is hereby amended in its
entirety to read as follows:
Simultaneously with the termination of the
Servicer's responsibilities and duties under this Agreement
(a) pursuant to Sections 6.02, 7.03, 8.03, 9.01 or 9.02, the
Master Servicer shall, in accordance with the provisions of
the Trust Agreement (i) succeed to and assume all of the
Servicer's responsibilities, rights, duties and obligations
under this Agreement, or (ii) appoint a successor meeting
the eligibility requirements of this Agreement set forth in
Sections 8.01(i) and (ii) and which shall succeed to all
rights and assume all of the responsibilities, duties and
liabilities of the Servicer under this Agreement with the
termination of the Servicer's responsibilities, duties and
liabilities under this Agreement. Any successor to the
Servicer that is not at that time a servicer of other
mortgage loans for the Trust Fund shall be subject to the
approval of the Master Servicer, Lehman Capital, the Trustee
and each Rating Agency (as such term is defined in the Trust
Agreement). Unless the successor servicer is at that time a
Servicer of other mortgage loans for the Trust Fund, each
Rating Agency must deliver to the Trustee a letter to the
effect that such transfer of servicing will not result in a
qualification, withdrawal or downgrade of the then-current
rating of any of the Certificates. In connection with such
appointment and assumption, the Master Servicer or the
Depositor, as applicable, may make such arrangements for the
compensation of such successor out of payments on the
Mortgage Loans as it and such successor shall agree;
provided, however, that no such compensation shall be in
excess of that permitted the Servicer under this Agreement.
In the event that the Servicer's duties, responsibilities
and liabilities under this Agreement should be terminated
pursuant to the aforementioned sections, the Servicer shall
discharge such duties and responsibilities 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 aforementioned sections shall
not become effective until a successor shall be appointed
pursuant to this Section 10.01 and shall in no event relieve
the Servicer of the representations and warranties made
pursuant to Section 6.01 and the remedies available to the
Trustee under Sections 6.02 and 7.03, it being understood
and agreed that the provisions of such Sections 6.01, 6.02
and 7.03 shall be applicable to the Servicer notwithstanding
any such resignation or termination of the Servicer, or the
termination of this Agreement.
Within a reasonable period of time, but in no event
longer than 30 days of the appointment of a successor
entity, the Servicer shall prepare, execute and deliver to
the successor entity any and all documents and other
instruments, place in such successor's possession all
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. The Servicer shall cooperate
with the Trustee and the Master Servicer, as applicable, and
such successor in effecting the termination of the
Servicer's responsibilities and rights hereunder and the
transfer of servicing responsibilities to the successor
Servicer, 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 Servicer to the
Custodial Account or any Escrow Account or thereafter
received with respect to the Mortgage Loans.
Any successor appointed as provided herein shall
execute, acknowledge and deliver to the Trustee, the
Servicer and the Master Servicer an instrument (i) accepting
such appointment, wherein the successor shall make the
representations and warranties set forth in Section 6.01 and
(ii) an assumption of the due and punctual performance and
observance of each covenant and condition to be performed
and observed by the Servicer under this Agreement, whereupon
such successor shall become fully vested with all the
rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer, with like effect as if
originally named as a party to this Agreement. Any
termination or resignation of the Servicer or termination of
this Agreement pursuant to Sections 10.01 shall not affect
any claims that the Master Servicer or the Trustee may have
against the Servicer arising out of the Servicer's actions
or failure to act prior to any such termination or
resignation.
The Servicer shall deliver within five (5) Business
Days of a servicing transfer to the successor Servicer the
funds in the Custodial Account and Escrow Account and all
Mortgage Loan Documents and related documents and statements
held by it hereunder and 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.
Upon a successor's acceptance of appointment as
such, the Servicer shall notify the Trustee and Master
Servicer of such appointment in accordance with the notice
procedures set forth herein.
Except as otherwise provided in this Agreement, all
reasonable costs and expenses incurred in connection with
any transfer of servicing hereunder, solely as a result of a
termination for cause of the Servicer pursuant to Section
9.01 of the Master Servicing Agreement, including, without
limitation, the costs and expenses of the Master Servicer or
any other Person in appointing a successor servicer, or of
the Master Servicer in assuming the responsibilities of the
Servicer hereunder, or of transferring the Servicing Files
and the other necessary data to the successor servicer shall
be paid by the terminated, removed or resigning Servicer
from its own funds without reimbursement.
33. The parties hereto acknowledge that Section 10.02 (Closing), Section
10.03 (Closing Documents), Section 10.07 (Notices) and Section 10.16
(Exhibits) are inapplicable to this Agreement.
34. Intended Third Party Beneficiaries. Notwithstanding any provision
herein to the contrary, the parties to this Agreement agree that it is
appropriate, in furtherance of the intent of such parties as set
forth herein, that the Master Servicer and the Trustee receive the
benefit of the provisions of this Agreement as intended third party
beneficiaries of this Agreement to the extent of such provisions. The
Servicer shall have the same obligations to the Master Servicer and
the Trustee as if they were parties to this Agreement, and the Master
Servicer and the Trustee shall have the same rights and remedies to
enforce the provisions of this Agreement as if they were parties to
this Agreement. The Servicer shall only take direction from the
Master Servicer (if direction by the Master Servicer is required under
this Agreement) unless otherwise directed by this Agreement.
Notwithstanding the foregoing, all rights and obligations of the
Master Servicer and the Trustee hereunder (other than the right to
indemnification) shall terminate upon termination of the Trust
Agreement and of the Trust Fund pursuant to the Trust Agreement.
<PAGE>
EXHIBIT B
Master Servicing Agreement
<PAGE>
EXHIBIT C
Assignment and Assumption Agreement
<PAGE>
EXHIBIT D
Mortgage Loan Schedule
