Exhibit 10.2
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
November 14, 2006
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT (the "AAR"), dated
November 14, 2006, is among Bank of America, National Association, a national
banking association having an office at 100 North Tryon Street, Charlotte, North
Carolina 28255 (the "Assignor"), Asset Backed Funding Corporation, a Delaware
corporation having an office at 214 North Tryon Street, Charlotte, North
Carolina 28255 (the "Assignee"), and Option One Mortgage Corporation, a
California corporation having an office at 3 Ada, Irvine, California 92618-2304
(the "Company").
For and in consideration of the sum of one dollar ($1.00) and other
valuable consideration the receipt and sufficiency of which are hereby
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
1. Reference is made to that certain Flow Sale and Servicing Agreement
(the "Flow Sale Agreement"), dated as of July 28, 2006, by and among the
Assignor, the Company, Option One Owner Trust 2001-1A, Option One Owner Trust
2001-1B, Option One Owner Trust 2001-2, Option One Owner Trust 2002-3, Option
One Owner Trust 2003-4, Option One Owner Trust 2003-5, Option One Owner Trust
2005-6, Option One Owner Trust 2005-7, Option One Owner Trust 2005-8 and Option
One Owner Trust 2005-9, and the Memorandum of Sale (the "Memorandum of Sale,"
and together with the Flow Sale Agreement, the "Transfer Agreements"), dated
September 27, 2006 (the "Original Closing Date"), among the Assignor and the
Company, pursuant to which the Assignor purchased the mortgage loans listed on
Exhibit A hereto (the "Mortgage Loans").
2. The Assignor hereby grants, transfers and assigns to the Assignee
all of the right, title and interest of the Assignor, as Purchaser, under the
Transfer Agreements in respect of the Mortgage Loans, including but not limited
to the representations and warranties made by the Company in Sections 3.01 and
3.03 of the Flow Sale Agreement and the remedy provisions set forth in Section
3.04 of the Flow Sale Agreement. The Assignor specifically reserves and does not
assign to the Assignee hereunder (i) the Assignor's rights under Section 3.06 of
the Flow Sale Agreement, (ii) the Assignor's right to indemnity pursuant to
Sections 3.04, 8.01, 9.05 and 12.14 of the Flow Sale Agreement and (iii) the
right to receive the amount specified in the last sentence of Section 2.03(e) of
the Pooling and Servicing Agreement.
Notwithstanding the foregoing, the Company and the Assignee acknowledge
that in the event the Assignor repurchases any Mortgage Loan or otherwise
performs any other obligation under the Mortgage Loan Purchase Agreement (as
defined below) that is also the obligation of the Company under the Transfer
Agreements, the Assignor shall be deemed to have retained its right to enforce
such obligation against the Company to the extent it has performed such
obligation. In addition, notwithstanding any provision in this AAR to the
contrary, the Assignor specifically reserves and does not assign to the Assignee
any right, title and interest in, to or under any Mortgage Loans subject to the
Transfer Agreements other than the Mortgage Loans that are listed on Exhibit A
hereto.
3. The Company hereby agrees that the repurchase price with respect to
any Mortgage Loan repurchased pursuant to the Flow Sale Agreement (other than
Section 3.05 of the Flow Sale Agreement) shall be the "Purchase Price" set forth
in the Pooling and Servicing Agreement.
4. The Assignor hereby grants, transfers and assigns to the Assignee
all of the right, title and interest of the Assignor in respect of the Mortgage
Loans in the Custodial Agreement (the "Custodial Agreement"), dated as of July
28, 2006, by and between the Assignor and Wells Fargo Bank, N.A.
5. The Assignor has sold, assigned, set over, and otherwise conveyed
its rights in, to and under the Mortgage Loans delivered under the Transfer
Agreements to the Assignee pursuant to that certain Mortgage Loan Purchase
Agreement (the "Mortgage Loan Purchase Agreement"), dated as of October 1, 2006,
by and between the Assignee, as purchaser, and the Assignor, as seller.
6. The Assignee has further assigned its rights in, to and under (i)
this AAR and (ii) the Mortgage Loans delivered to Wells Fargo Bank, N.A., as
trustee (the "Trustee"), pursuant to that certain Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of October 1, 2006,
among the Assignee, as depositor, the Company and the Trustee.
7. The Assignor represents and warrants to, and covenants with, the
Assignee that:
a. The Assignor has not received notice of, and has no
knowledge of, any offsets, counterclaims or other defenses available to the
Company with respect to the Transfer Agreements or the Mortgage Loans;
b. The Assignor is the lawful owner of the Mortgage Loans with
the full right to transfer the Mortgage Loans and all of its interests, rights
and obligations under the Transfer Agreements free from any and all claims and
encumbrances whatsoever. Except for the sale to the Assignee, the Assignor has
not assigned or pledged any Mortgage Note related to any Mortgage Loan or the
related Mortgage or any interest or participation therein;
c. The Assignor has not satisfied, canceled, or subordinated
in whole or in part, or rescinded the Mortgage related to any Mortgage Loan, and
the Assignor has not released the Mortgaged Property from the lien of the
Mortgage related to any Mortgage Loan, in whole or in part, nor has the Assignor
executed an instrument that would effect any such release, cancellation,
subordination, or rescission;
d. Neither the Assignor nor anyone acting on its behalf has
offered, transferred, pledged, sold or otherwise disposed of the Mortgage Loans,
any interest in the Mortgage Loans or any other similar security to, or
solicited any offer to buy or accept a transfer, pledge or other disposition of
the Mortgage Loans, any interest in the Mortgage Loans or any other similar
security from, or otherwise approached or negotiated with respect to the
Mortgage Loans, any interest in the Mortgage Loans or any other similar security
with, any person in any manner, or made any general solicitation by means of
general advertising or in any other manner, or taken any other action which
would constitute a distribution of the Mortgage Loans under the Securities Act
of 1933 (the "Securities Act") or which would render the disposition of the
Mortgage Loans a violation of Section 5 of the Securities Act or require
registration pursuant thereto;
e. The Assignor has not taken any action that would serve to
impair or encumber the Assignor's ownership interest in any Mortgage Loan since
the related Original Closing Date; and
f. The Assignor has not waived or agreed to any waiver under,
or agreed to any amendment or other modification of, the Transfer Agreements,
the Custodial Agreement or the Mortgage Loans, including without limitation the
transfer of the servicing obligations under the Transfer Agreements. The
Assignor has no knowledge of, and has not received notice of, any waivers under
or amendments or other modifications of, or assignments of rights or obligations
under, the Transfer Agreements or the Mortgage Loans.
8. The Assignee represents and warrants to, and covenants with, the
Assignor and the Company pursuant to Section 12.11 of the Flow Sale Agreement
that:
a. The Assignee agrees to be bound, as Purchaser, by all of
the terms, covenants and conditions of Section 3.04 of the Flow Sale Agreement,
the Mortgage Loans and the Custodial Agreement, and from and after the date
hereof, the Assignee assumes for the benefit of each of the Company and the
Assignor all of the Assignor's obligations as purchaser thereunder;
b. Neither the Assignee nor anyone acting on its behalf has
offered, transferred, pledged, sold or otherwise disposed of the Mortgage Loans,
any interest in the Mortgage Loans or any other similar security to, or
solicited any offer to buy or accepted a transfer, pledge or other disposition
of the Mortgage Loans, any interest in the Mortgage Loans or any other similar
security from, or otherwise approached or negotiated with respect to the
Mortgage Loans, any interest in the Mortgage Loans or any other similar security
with, any person in any manner which would constitute a distribution of the
Mortgage Loans under the Securities Act or which would render the disposition of
the Mortgage Loans a violation of Section 5 of the Securities Act or require
registration pursuant thereto, nor will it act, nor has it authorized or will it
authorize any person to act, in such manner with respect to the Mortgage Loans;
c. Either (1) the Assignee is not an employee benefit plan
("Plan") within the meaning of section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") or a plan ("Plan") within the meaning
of section 4975(e)(1) of the Internal Revenue Code of 1986 ("Code"), and the
Assignee is not directly or indirectly purchasing the Mortgage Loans on behalf
of, investment manager of, as named fiduciary of, as trustee of, or with assets
of, a Plan; or (2) the Assignee's purchase of the Mortgage Loans will not result
in a prohibited transaction under section 406 of ERISA or section 4975 of the
Code; and
d. The Assignee's address for purposes of all notices and
correspondence related to the Mortgage Loans and the Flow Sale Agreement is:
Asset Backed Funding Corporation
214 North Tryon Street, 21st Floor
Charlotte, North Carolina 28255
Attention: ABFC 2006-OPT3
9. The Company represents and warrants to the Assignor and the Assignee
and covenant, acknowledge and agree that, as of the date hereof:
a. The Company and the Assignor represent and warrant to the
Assignee that (i) attached hereto as Exhibit B and Exhibit C are true, accurate
and complete copies of the Flow Sale Agreement and the Custodial Agreement,
respectively, and all amendments and modifications, if any, thereto, (ii)
neither the Flow Sale Agreement nor the Custodial Agreement has been amended or
modified in any respect, except as set forth in this Agreement, and (iii) no
notice of termination has been given to the Company under the Flow Sale
Agreement;
b. The Company represents and warrants that through the date
hereof the Company has serviced the Mortgage Loans in accordance with the terms
of the Flow Sale Agreement; and
c. The representations and warranties set forth in Section
3.01 of the Flow Sale Agreement are made by the Company as of the date hereof.
10. It is the intention of the Assignor, the Company and the Assignee
that Sections 3.03 and 3.04 of the Flow Sale Agreement shall be binding upon and
inure to the benefit of the Company and the Assignee and their respective
successors and assigns.
11. From and after the date hereof, the Company shall note the transfer
of the Mortgage Loans to the Assignee in its books and records, the Company
shall recognize the Assignee as the owner of the Mortgage Loans and the Company
shall service the Mortgage Loans for the benefit of the Assignee pursuant to the
Flow Sale Agreement, the terms of which are incorporated herein by reference. In
connection therewith the Company shall provide the Assignee on a timely basis
with all information and reports which shall be required to permit the Assignee
or its designee to comply with the informational and reporting requirements of
Regulation AB under the Securities Act.
12. Capitalized terms used but not defined herein shall have the
respective meaning ascribed thereto in the Mortgage Loan Purchase Agreement.
[Signatures Follow]
IN WITNESS WHEREOF, the parties have caused this AAR to be executed by
their duly authorized officers as of the date first above written.
BANK OF AMERICA, NATIONAL ASSOCIATION ASSET BACKED FUNDING CORPORATION
Assignor Assignee
By: /s/ Daniel B. Goodwin By: /s/ Bruce W. Good
---------------------------------- ---------------------------------
Name: Daniel B. Goodwin Name: Bruce W. Good
Its: Principal Its: Principal
Acknowledged as of the date first above written
OPTION ONE MORTGAGE CORPORATION
Company
By: /s/ Deborah K. Lonergan
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Name: Deborah K. Lonergan
-----------------------------------
Its: Assistant Secretary
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EXHIBIT A
[Intentionally Omitted]
EXHIBIT B
[Intentionally Omitted]
EXHIBIT C
[Intentionally Omitted]
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