ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
This Assignment, Assumption and Recognition Agreement (this AAR Agreement) is made and entered into as of February 28, 2006 (the Closing Date), among DB Structured Products, Inc., having an address at 60 Wall Street, New York, New York 10005 (the Assignor), ACE Securities Corp., having an address at 6525 Morrison Boulevard, Suite 318, Charlotte, North Carolina 28211 (the Assignee) and Fremont Investment & Loan, having an address at 2727 E. Imperial Hwy, Brea, California 92821 (the Company).
WHEREAS, the Assignor purchased the residential mortgage loans listed on Attachment 1 annexed hereto (the Assigned Loans) from the Company pursuant to that certain Master Mortgage Loan Purchase and Interim Servicing Agreement dated May 1, 2004, between the Assignor and the Company (the Purchase and Servicing Agreement), as amended by Amendment Number One, dated September 29, 2004, Amendment Number Two, dated June 1, 2005 and Amendment Number Three, dated November 29, 2005, each between the Assignor and the Company (the Amendments; together with the Purchase and Servicing Agreement, the Agreement).
In consideration of the mutual promises contained herein the parties hereto agree that the Assigned Loans now serviced by the Company for the Assignor and its successors and assigns pursuant to the Agreement, shall, from and after the date of this AAR Agreement until April 1, 2006 (the Servicing Transfer Date), be serviced by the Company in accordance with the provisions of the Agreement as modified by the terms of this AAR Agreement. Capitalized terms used herein but not defined shall have the meanings ascribed to them in the Agreement.
Assignment and Assumption; Consideration
1. Assignor hereby grants, transfers and assigns to Assignee all of the right, title and interest of Assignor in, to and under the Agreement, as it relates to the Assigned Loans. Assignor specifically reserves and does not assign to Assignee any right, title and interest in, to or under (a) any mortgage loans subject to the Agreement other than the Assigned Loans, (b) the representations and warranties set forth in Sections 7.01, 7.02 and 7.05 of the Agreement, or (c) the rights and remedies set forth in Sections 7.03 and 7.04 of the Agreement.
Representations, Warranties and Covenants
2. Assignor warrants and represents to Assignee and Company as of the Closing Date:
| (a) |
Attached hereto as Attachment 2 is a true and accurate copy of the Agreement, which Agreement is in full force and effect as of the Closing Date and the provisions of which have not been waived, amended or modified in any respect, nor has any notice of termination been given thereunder; |
| (b) |
Assignor was the lawful owner of the Assigned Loans with full right to transfer the Assigned Loans and any and all of its interests, rights and obligations under the Agreement as they relate to the Assigned Loans, free and clear from any and all claims and encumbrances; and upon the transfer of the Assigned Loans to Assignee, Assignee shall have good title to each and every Assigned Loan, as well as any and all of Assignors interests, rights and obligations under the Agreement as they relate to the Assigned Loans, free and clear of any and all liens, claims and encumbrances; |
| (c) |
Assignor is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation, and has all requisite power and authority to acquire, own and sell the Assigned Loans; |
| (d) |
Assignor has full corporate power and authority to execute, deliver and perform its obligations under this AAR Agreement, and to consummate the transactions set forth herein. The consummation of the transactions contemplated by this AAR Agreement is in the ordinary course of Assignors business and will not conflict with, or result in a breach of, any of the terms, conditions or provisions of Assignors certificate of incorporation or by-laws or any legal restriction, or any material agreement or instrument to which Assignor is now a party or by which it is bound, or result in the violation of any law, rule, regulation, order, judgment or decree to which Assignor or its property is subject. The execution, delivery and performance by Assignor of this AAR Agreement and the consummation by it of the transactions contemplated hereby, have been duly authorized by all necessary corporate action on the part of Assignor. This AAR Agreement has been duly executed and delivered by Assignor and, upon the due authorization, execution and delivery by Assignee and Company, will constitute the valid and legally binding obligation of Assignor enforceable against Assignor in accordance with its terms except as enforceability may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws now or hereafter in effect relating to creditors rights generally, and by general principles of equity regardless of whether enforceability is considered in a proceeding in equity or at law; and |
| (e) |
No consent, approval, order or authorization of, or declaration, filing or registration with, any governmental entity is required to be obtained or made by Assignor in connection with the execution, delivery or performance by Assignor of this AAR Agreement, or the consummation by it of the transactions contemplated hereby. |
3. Assignee warrants and represents to, and covenants with, Assignor and Company as of the Closing Date:
| (a) |
Assignee is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite power and authority to acquire, own and purchase the Assigned Loans; |
| (b) |
Assignee has full corporate power and authority to execute, deliver and perform its obligations under this AAR Agreement, and to consummate the transactions set forth herein. The consummation of the transactions contemplated by this AAR Agreement is in the ordinary course of Assignees business and will not conflict with, or result in a breach of, any of the terms, conditions or provisions of Assignees certificate of incorporation or by-laws or any legal restriction, or any material agreement or instrument to which Assignee is now a party or by which it is bound, or result in the violation of any law, rule, regulation, order, judgment or decree to which Assignee or its property is subject. The execution, delivery and performance by Assignee of this AAR Agreement and the consummation by it of the transactions contemplated hereby, have been duly authorized by all necessary corporate action on the part of Assignee. This AAR Agreement has been duly executed and delivered by Assignee and, upon the due authorization, execution and delivery by Assignor and Company, will constitute the valid and legally binding obligation of Assignee enforceable against Assignee in accordance with its terms except as enforceability may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws now or hereafter in effect relating to creditors rights generally, and by general principles of equity regardless of whether enforceability is considered in a proceeding in equity or at law; |
| (c) |
No consent, approval, order or authorization of, or declaration, filing or registration with, any governmental entity is required to be obtained or made by Assignee in connection with the execution, delivery or performance by Assignee of this AAR Agreement, or the consummation by it of the transactions contemplated hereby; and |
| (d) |
Assignee agrees to be bound by all of the terms, covenants and conditions of the Agreement with respect to the Assigned Loans, and from and after the Closing Date, Assignee assumes for the benefit of each of Assignor and Company all of Assignors obligations thereunder but solely with respect to such Assigned Loans. |
4. Company warrants and represents to, and covenants with, Assignor and Assignee as of the Closing Date:
| (a) |
Attached hereto as Attachment 2 is a true and accurate copy of the Agreement, which Agreement is in full force and effect as of the Closing Date and the provisions of which have not been waived, amended or modified in any respect, nor has any notice of termination been given thereunder; |
| (b) |
Company is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, and has all requisite power and authority to service the Assigned Loans and otherwise to perform its obligations under the Agreement; |
| (c) |
Company has full power and authority to execute, deliver and perform its obligations under this AAR Agreement, and to consummate the transactions set forth herein. The consummation of the transactions contemplated by this AAR Agreement is in the ordinary course of Companys business and will not conflict with, or result in a breach of, any of the terms, conditions or provisions of Companys charter or by-laws or any legal restriction, or any material agreement or instrument to which Company is now a party or by which it is bound, or result in the violation of any law, rule, regulation, order, judgment or decree to which Company or its property is subject. The execution, delivery and performance by Company of this AAR Agreement and the consummation by it of the transactions contemplated hereby, have been duly authorized by all necessary corporate action on the part of Company. This AAR Agreement has been duly executed and delivered by Company, and, upon the due authorization, execution and delivery by Assignor and Assignee, will constitute the valid and legally binding obligation of Company, enforceable against Company in accordance with its terms except as enforceability may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws now or hereafter in effect relating to creditors rights generally, and by general principles of equity regardless of whether enforceability is considered in a proceeding in equity or at law; |
| (d) |
No consent, approval, order or authorization of, or declaration, filing or registration with, any governmental entity is required to be obtained or made by Company in connection with the execution, delivery or performance by Company of this AAR Agreement, or the consummation by it of the transactions contemplated hereby; |
| (e) |
Company shall service the Assigned Loans from the Closing Date until the Servicing Transfer Date in accordance with the terms and provisions of the Agreement, as modified by this AAR Agreement, and shall establish a Custodial Account and an Escrow Account under the Agreement with respect to the Assigned Loans separate from the Custodial Account and Escrow Account previously established in favor of Assignor under the Agreement, and shall remit collections received on the Assigned Loans to such accounts. The Custodial Account and Escrow Account shall be entitled Fremont Investment & Loan, as servicer in trust for ACE Securities Corp. Home Equity Loan Trust, Series 2006-HE1; and |
| (f) |
The Company shall furnish, on a monthly basis, in accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and complete borrower credit files to Equifax, Experian and the TransUnion Credit Information Company with respect to each Assigned Loan. |
5. Company hereby acknowledges that Wells Fargo Bank, National Association has been appointed as the master servicer of the Assigned Loans pursuant to the Pooling and Servicing Agreement (the Pooling and Servicing Agreement), dated as of February 1, 2006, among HSBC Bank USA, National Association (the Trustee), Wells Fargo Bank, National Assocation, as a servicer, master servicer and securities administrator (the Master Servicer and the Servicer), Ocwen Loan Servicing, LLC, as a servicer and the Assignee, as depositor. In accordance with the terms and conditions set forth in the Agreement, as modified by this AAR Agreement, Company shall deliver, with respect to the Assigned Loans (a) the monthly remittance report (in the form attached hereto as Attachment 3 (including Attachment 3A, if applicable)) relating to the Distribution Date occurring in March 2006, to the Master Servicer (with a copy to the Servicer), (b) the monthly remittance report (in the form attached hereto as Attachment 3 (including Attachment 3A, if applicable)) relating to the Distribution Date occurring in April 2006, to the Servicer, and (c) all other reports required to be delivered under the Agreement, as modified by this AAR Agreement, to the Master Servicer.
Company shall deliver any reports required to be delivered to the Master Servicer to:
Wells Fargo Bank, National Association
9062 Old Annapolis Road
Columbia, Maryland 21045
Attention: ACE 2006-HE1
Telecopier No.: (410) 715-2380
Company shall deliver any reports required to be delivered to the Servicer to:
Wells Fargo Bank, National Association
One Home Campus
Des Moines, Iowa 50328-0001
Attention: Mike Underwood
Recognition of Assignee
6. From and after the Closing Date, Company shall recognize Assignee as owner of the Assigned Loans, and acknowledges that the Assigned Loans will be part of a REMIC, and will service the Assigned Loans from the Closing Date until the Servicing Transfer Date in accordance with the Agreement, as modified by this AAR Agreement, but in no event in a manner that would (i) cause any REMIC to fail to qualify as a REMIC or (ii) result in the imposition of a tax upon any REMIC (including but not limited to the tax on prohibited transactions as defined in Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set forth in Section 860G(d) of the Code).
It is the intention of Assignor, Company and Assignee that this AAR Agreement shall be binding upon and for the benefit of the respective successors and assigns of the parties hereto. Neither Company nor Assignor shall amend or agree to amend, modify, waive, or otherwise alter any of the terms or provisions of the Agreement which amendment, modification, waiver or other alteration would in any way affect the Assigned Loans without the prior written consent of the Trustee and the Master Servicer. Pursuant to the Pooling and Servicing Agreement, the Assignee will assign all of its rights under this AAR Agreement to the Trustee for the benefit of the certificateholders.
In addition, Company hereby acknowledges that from and after the Closing Date, the Assigned Loans will be subject to the terms and conditions of the Pooling and Servicing Agreement pursuant to which the Master Servicer is required to monitor the performance by Company of its servicing obligations under the Agreement, as modified by this AAR Agreement, and has the right to enforce the obligations of Company under the Agreement, as modified by this AAR Agreement, with respect to the servicing of the Assigned Loans. Such right will include, without limitation, the right to terminate Company under the Agreement as provided therein, the right to receive all remittances required to be made by Company with respect to the Assigned Loans under the Agreement for the Distribution Date occurring in March 2006, the right to receive all monthly reports and other data required to be delivered by Company under the Agreement with respect to the Distribution Date occurring in March 2006 (as described in Section 5 of this AAR Agreement), the right to examine the books and records of Company, the right to indemnification, and the right to exercise certain rights of consent and approval relating to actions taken by Company. In connection therewith, Company shall (i) on the Distribution Date occurring in March 2006, remit to the Master Servicer, in accordance with the wire transfer instructions set forth below, with respect to the Assigned Loans (a) all Principal Prepayments collected during the Prepayment Period relating to the March 2006 Distribution Date plus any Prepayment Interest Shortfalls payable by the Company in connection with such Principal Prepayments, and (b) all Monthly Payments due, whether or not received, during the period commencing on February 1, 2006 and ending on March 1, 2006; and (ii) on the Servicing Transfer Date, remit to the Servicer, in accordance with the wire transfer instructions set forth below, with respect to the Assigned Loans (a) all Principal Prepayments in full collected during the portion of the Prepayment Period occurring from the 16th day of the month preceding the month of the Servicing Transfer Date and ending on the last day of such month and all Principal Prepayments in part collected during the month preceding the month of the Servicing Transfer Date, plus any Prepayment Interest Shortfalls payable by the Company in connection with such Principal Prepayments, and (b) all Monthly Payments collected by the Company during the related Due Period. In addition, Company shall provide to the Servicer a file, in a format mutually acceptable to the Company and the Servicer, setting forth the scheduled principal balance as of April 1, 2006 for each of the Assigned Loans.
ACE Securities Corp. 2006-HE1 Distribution Account
Wells Fargo Bank, National Association
ABA # 121-000-248
Account Name: SAS Clearing
Account # 3970771416
For Further Credit to: ACE 2006-HE1 Account Number 50901300
Company shall make all remittances required to be made to the Servicer pursuant to the foregoing provisions with respect to the Assigned Loans in accordance with the following wire transfer instructions:
Wells Fargo Bank, N.A.
San Francisco, California
Acct # 7028209
Acct Name: Service Holding
ABA #121000248
Attention: Denise Hansen, Investor Services
Modification of the Agreement
7. Assignor and Company hereby amend the Agreement with respect to the Assigned Loans as follows:
(a) The following definitions shall be added to Section 1 of the Agreement:
Commission: The United States Securities and Exchange Commission.
Depositor: ACE Securities Corp.
Master Servicer: Wells Fargo Bank, National Association or any successor thereto.
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
Sarbanes-Oxley Act: The Sarbanes-Oxley Act of 2002, as amended from time to time.
Securities Act: The Securities Act of 1933, as amended.
Securities Administrator: Wells Fargo Bank, National Association, or any successor thereto.
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.
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 Seller or a Sub-Servicer.
Trustee: HSBC Bank USA, National Association, or any successor thereto.
(b) The definition of Business Day is hereby deleted in its entirety and replaced with the following:
Business Day: Any day other than a Saturday, Sunday, or a day on which banking or savings and loan institutions in the State of California, the State of New York, the State of Iowa, the State of Maryland or the State of Minnesota are authorized or obligated by law or executive order to be closed.
(c) The definition of Interim Servicing Period is hereby deleted in its entirety and replaced with the following:
Interim Servicing Period: With respect to any Mortgage Loan, the period commencing on the related Closing Date and ending on March 31, 2006.
(d) The definition of Pass-Through Transfer is hereby deleted in its entirety.
(e) The definition of Regulation AB is hereby deleted in its entirety and replaced with the following:
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.
(f) The definition of Servicing Fee Rate is hereby deleted in its entirety and replaced with the following:
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