Additional Mortgage Loan Conveyance Agreement

ADDITIONAL MORTGAGE LOAN CONVEYANCE AGREEMENT
Dated as of March 1, 1997


among


AAMES CAPITAL CORPORATION,
as Seller,


AAMES CAPITAL ACCEPTANCE CORP.,
as Transferor,


AAMES CAPITAL OWNER TRUST 1997-1,
as Issuer,


and


BANKERS TRUST COMPANY OF CALIFORNIA, N.A.,
as Indenture Trustee


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This Additional Mortgage Loan Conveyance Agreement (this "Agreement"), dated as of March 1, 1997, is among Aames Capital Corporation (the "Seller"), Aames Capital Acceptance Corp. (the "Transferor"), Aames Capital Owner Trust 1997-1 (the "Issuer") and Bankers Trust Company of California, N.A. (the "Indenture Trustee").


From time to time during the period (the "Funding Period") from March 18, 1997 through April 14, 1997, the Seller intends to convey and the Transferor intends to acquire certain adjustable rate home equity mortgage loans (the "Additional Mortgage Loans") as provided in this Agreement. Upon receipt of such Additional Mortgage Loans, the Transferor will immediately convey the Additional Mortgage Loans to the Issuer, who will in turn pledge the Additional Mortgage Loans to the Indenture Trustee under that certain indenture, dated as of March 1, 1997 (the "Indenture"), by and between the Issuer and the Indenture Trustee, pursuant to which the Issuer's $415,000,000 aggregate principal amount of Adjustable Rate Asset-Backed Bonds, Series 1997-1 (the "Bonds") are being issued.


Reference is hereby made to the Initial Mortgage Loan Conveyance Agreement, dated as of March 1, 1997 (the "Initial Mortgage Loan Conveyance Agreement"), between the Seller and the Transferor pursuant to which certain adjustable rate home equity mortgage loans identified therein (the "Initial Mortgage Loans") are being conveyed by the Seller to the Transferor. Reference is also hereby made to the Mortgage Loan Contribution Agreement, dated as of March 1, 1997 (the "Mortgage Loan Contribution Agreement"), between the Transferor and the Issuer pursuant to which the Initial Mortgage Loans are being conveyed by the Transferor to the Issuer, together with all rights of the Transferor under the Initial Mortgage Loan Conveyance Agreement. The Issuer is pledging the Initial Mortgage Loans, together with its rights under the Initial Mortgage Loan Conveyance Agreement and the Mortgage Loan Contribution Agreement, and certain other property, to the Indenture Trustee as part of the Trust Estate for the Bonds.


The Seller, the Transferor, the Issuer and the Indenture Trustee are entering into this Agreement for the purpose of establishing the terms under which the Additional Mortgage Loans may, during the Funding Period, be (i) sold by the Seller to the Transferor, (ii) conveyed by the Transferor to the Issuer and (iii) pledged to the Indenture Trustee as part of the Trust Estate in exchange for the Subsequent Purchase Price and any Additional Subsequent Purchase Price to be paid by the Indenture Trustee from amounts on deposit in the Prefunding Account pursuant to and in accordance with Section 8.03 of the Indenture.


Now, therefore, in consideration of the premises and the mutual agreements set forth herein, the parties agree as follows:


SECTION 1. Definitions. Capitalized terms used in this Agreement and not otherwise defined herein shall have the respective meanings ascribed thereto in the Initial Mortgage Loan Conveyance Agreement or the Indenture, as the context requires.


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SECTION 2. Agreements to Acquire.


(a) The Seller shall from time to time during the Funding Period convey, and the Transferor shall from time to time during the Funding Period acquire, the Additional Mortgage Loans having an Aggregate Principal Balance not in excess of the amount of the Prefunding Account Deposit and identified on Additional Mortgage Loan Schedules delivered to the Transferor on any Subsequent Transfer Date. The conveyance of the Additional Mortgage Loans from the Seller to the Transferor shall take place on the related Subsequent Transfer Date. Each such conveyance of Additional Mortgage Loans by the Seller to the Transferor shall be effected in accordance with the provisions of Section 3 of the Initial Mortgage Loan Conveyance Agreement as though such Additional Mortgage Loans were Initial Mortgage Loans. The provisions of Section 3 of the Initial Mortgage Loan Conveyance Agreement are hereby incorporated by reference and shall be deemed to refer to conveyances of Additional Mortgage Loans by the Seller pursuant to this Section 2(a). The Seller shall be deemed to have made the representations and warranties set forth in Section 4(b) of the Initial Mortgage Loan Conveyance Agreement with respect to each Additional Mortgage Loan as of the date specified therein or, if no date is specified, as of the related Subsequent Transfer Date and the Transferor shall have the rights and remedies for defects in the related Mortgage File or breaches for such representations and warranties as set forth in Section 3 and Section 5 of the Initial Mortgage Loan Conveyance Agreement. The consideration for the Additional Mortgage Loans conveyed pursuant to this Agreement shall be specified in each Addition Notice, which consideration shall be exchanged on or prior to the related Subsequent Transfer Date.


(b) The Transferor shall convey, and the Issuer shall acquire, each Additional Mortgage Loan acquired by the Transferor from the Seller pursuant to Section 2(a). Each such conveyance shall occur on the related Subsequent Transfer Date for such Additional Mortgage Loan immediately upon the acquisition thereof by the Transferor and shall be effected in accordance with the provisions of Section 2 of the Mortgage Loan Contribution Agreement as though such Additional Mortgage Loan were an Initial Mortgage Loan. The provisions of Section 2 of the Mortgage Loan Contribution Agreement are hereby incorporated by reference and shall be deemed to refer to conveyances of Additional Mortgage Loans by the Transferor pursuant to Section 2(b). The Issuer shall acquire all rights and remedies of the Transferor for defects in the related Mortgage File or breaches of representations or warranties relating to such Additional Mortgage Loans as and to the extent contemplated in the Mortgage Loan Contribution Agreement with respect to the Initial Mortgage Loans. The Seller acknowledges the intention of the Transferor to convey and to assign its rights and remedies with respect to each Additional Mortgage Loan acquired by the Transferor pursuant to Section 2(a). The consideration for the Additional Mortgage Loans shall be equal to the consideration received by the Seller from the Transferor in respect of such Additional Mortgage Loans pursuant to Section 2(a) and shall be exchanged on or prior to the related Subsequent Transfer Date.


(c) The Issuer shall affirmatively Grant and the Indenture Trustee, subject only to the satisfaction of the provisions of this Agreement and Section 8.03 of the Indenture,


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shall accept and include in the Trust Estate for the benefit of the Bondholders, each Additional Mortgage Loan acquired by the Issuer from the Transferor pursuant to Section 2(b). Each such Grant of an Additional Mortgage Loan by the Issuer to the Indenture Trustee shall include the rights and remedies with respect to such Additional Mortgage Loan acquired from the Transferor pursuant to Section 2(b). Each such Grant of an Additional Mortgage Loan shall occur on the related Subsequent Transfer Date, and such Additional Mortgage Loan shall be included in the Trust Estate from and after such Subsequent Transfer Date, as evidenced by the attachment of the related Additional Mortgage Loan Schedule to the Mortgage Loan Schedule. On the related Subsequent Transfer Date for such Additional Mortgage Loan, the Indenture Trustee shall pay from the Prefunding Account the Subsequent Purchase Price for such Additional Mortgage Loan and, on or prior to the end of the Funding Date, any Additional Subsequent Purchase Price for such Additional Mortgage Loan, all in accordance with the provisions of Section 8.03 of the Indenture, subject, in each case, to the satisfaction of the conditions set forth in Section 6 and, in the case of the payment of any Additional Subsequent Purchase Price, to the satisfaction of the conditions set forth in Section 7. The Seller and the Transferor each acknowledge the intention of the Issuer to Grant to the Indenture Trustee each Additional Mortgage Loan, and the rights and remedies in respect thereof, acquired by the Issuer from the Transferor pursuant to Section 2(b).


(d) Additional Mortgage Loans to be conveyed on a given Subsequent Transfer Date must (i) have an Aggregate Principal Balance of not less than $500,000; provided, however, that the Additional Mortgage Loans to be conveyed on the final Subsequent Transfer Date may have an Aggregate Principal Balance of less than $500,000 and (ii) satisfy each of the representations and warranties contained in paragraph A of Schedule I hereto with respect to such Additional Mortgage Loans as of the related Subsequent Transfer Date.


(e) The Seller shall, at any time upon the request of the Transferor, the Issuer or the Indenture Trustee, without limiting the obligations of the Seller under this Agreement, execute, acknowledge and deliver all such additional documents and instruments and all such further assurances and will do or cause to be done all such further acts and things as may be proper or reasonably necessary to carry out the intent of this Agreement. The Transferor shall, at any time upon the request of the Issuer or the Indenture Trustee, without limiting the obligations of the Transferor under this Agreement, execute, acknowledge and deliver all such additional documents and instruments and all such further assurances and will do or cause to be done all such further acts and things as may be proper or reasonably necessary to carry out the intent of this Agreement.


(f) The conveyance by the Seller to the Transferor of Additional Mortgage Loans on any Subsequent Transfer Date pursuant to Section 2(a) shall be absolute and is intended by the Seller and the Transferor to be treated as a sale of such Additional Mortgage Loans by the Seller. The conveyance by the Transferor to the Issuer of Additional Mortgage Loans on any Subsequent Transfer Date pursuant to Section 2(b) shall be absolute and is intended by the Transferor and the Issuer to be treated as a sale of such Additional Mortgage Loans by the Transferor.


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SECTION 3. [Reserved.]


SECTION 4. Representations, Warranties and Covenants.


(a) Each representation and warranty set forth in Section 4(b) of the Initial Mortgage Loan Conveyance Agreement shall be deemed to have been made by the Seller with respect to each Additional Mortgage Loan as of the related Subsequent Transfer Date or, if a different date is specified in the representation or warranty, the date so specified, unless otherwise specified in the related Addition Notice, and such representations and warranties are incorporated by reference herein.


(b) On each Subsequent Transfer Date, (i) the Seller shall be deemed to have confirmed the representations and warranties of the Seller set forth in Section 4(a) of the Initial Mortgage Loan Conveyance Agreement in connection with the conveyance of the Additional Mortgage Loans on such date and (ii) the Transferor shall be deemed to have confirmed the representations and warranties of the Transferor set forth in Section 3(a) of the Mortgage Loan Contribution Agreement in connection with the conveyance of the Additional Mortgage Loans on such date.


(c) The representations and warranties deemed to have been made by the Seller pursuant to this Section 4 and the representations set forth in Schedule I annexed hereto shall survive delivery of the respective Mortgage Files by the transferors thereof to the transferees thereof and their respective assignees, notwithstanding any restrictive or qualified endorsement or assignment.


SECTION 5. Reacquisitions.


(a) The provisions of Section 5 of the Initial Mortgage Loan Conveyance Agreement relating to the obligations of the Seller, and the rights and remedies of the Transferor, in connection with breaches of representations or warranties in respect of the Initial Mortgage Loans are hereby incorporated by reference and shall be available in the event of breaches of any representations or warranties made by the Seller pursuant to Section 4(a) or as set forth in Schedule I annexed hereto with respect to each Additional Mortgage Loan conveyed by the Seller pursuant to Section 2(a).


(b) This Section 5 provides the sole remedies available against the Seller respecting any breach on the part of the Seller under Schedule 4(a) or Schedule I annexed hereto.


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SECTION 6. Conditions to Additional Transfers. Each transfer of Additional Mortgage Loans pursuant to this Agreement on each related Subsequent Transfer Date shall be subject to each of the following conditions:


(a) The Seller shall provide the Transferor, the Indenture Trustee and the Bond Insurer with the related Addition Notice and shall provide any information reasonably requested by the Indenture Trustee or the Bond Insurer with respect to the Additional Mortgage Loans at least one Business Day prior to the related Subsequent Transfer Date;


(b) All of the representations and warranties of the Seller referred to in Section 4(a) and Section 4(b) and set forth in Schedule I annexed hereto shall be true and correct in all material respects as of the date or dates made;


(c) The Seller shall certify that, as of the Subsequent Transfer Date, the Seller was not insolvent, was not made insolvent by such transfer and is not aware of any pending insolvency;


(d) The Funding Period shall not have expired;


(e) All of the obligations of the Seller under Section 2(a) (including the obligations incorporated by reference) with respect to the conveyance of the related Additional Mortgage Loans shall have been satisfied and the Transferor shall have effected the conveyance of such Additional Mortgage Loans as provided in Section 2(b);


(f) The Seller shall deposit in the Collection Account all collections in respect of each related Additional Mortgage Loan received or deemed received by the Seller on or after the related Cut-off Date (whether in the nature of amounts held by the Seller for later application on behalf of the related Mortgagor in respect of a Monthly Payment due on or after such Cut-off Date or otherwise), exclusive of amounts representing interest accrued on such Additional Mortgage Loans for any period prior to such Cut-off Date, and the Indenture Trustee shall have received confirmation of such deposit from the Servicer;


(g) The Seller shall deposit any applicable Subsequent Transfer Deposit in the Bond Account;


(h) All other terms and conditions of this Agreement required to be complied with on or before the related Subsequent Transfer Date with respect to the related Additional Mortgage Loans shall have been complied with and the Seller shall have the ability to comply with all terms and conditions and perform all duties and obligations required to be complied with or performed with respect to the rel ...