EXHIBIT 4.5
==============================================================================
WACHOVIA BANK, NATIONAL ASSOCIATION
as Servicer,
WACHOVIA MORTGAGE LOAN TRUST, LLC [_____] TRUST
as Issuer,
WACHOVIA BANK, NATIONAL ASSOCIATION
as Paying Agent
and
[_________________]
as Indenture Trustee
_________________________
SERVICING AGREEMENT
Dated as of _____ __, 200_
_________________________
==============================================================================
TABLE OF CONTENTS
Page
ARTICLE I Definitions...................................................1
Section 1.01 Definitions.............................................1
Section 1.02 Other Definitional Provisions...........................1
Section 1.03 Interest Calculations...................................2
ARTICLE II Representations and Warranties................................2
Section 2.01 Representations and Warranties Regarding the
Servicer................................................2
Section 2.02 Representations and Warranties of the Issuer............3
Section 2.03 Enforcement of Representations and Warranties...........4
ARTICLE III Administration and Servicing of Mortgage Loans................5
Section 3.01 The Servicer............................................5
Section 3.02 Collection of Certain Mortgage Loan Payments............7
Section 3.03 Custodial Duties........................................8
Section 3.04 Withdrawals from the Custodial Account.................10
Section 3.05 Maintenance of Hazard Insurance; Property
Protection Expenses....................................12
Section 3.06 Modification Agreements................................13
Section 3.07 Trust Estate; Related Documents........................14
Section 3.08 Realization upon Defaulted Mortgage Loans..............14
Section 3.09 Management and Sale of REO Property....................15
Section 3.10 Issuer and Indenture Trustee to Cooperate..............15
Section 3.11 Compensation; Payment of Certain Expenses..............16
Section 3.12 Annual Statement as to Compliance......................17
Section 3.13 Annual Independent Public Accountant's Servicing
Report.................................................17
Section 3.14 Access to Certain Documentation and Information
Regarding the Mortgage Loans...........................17
Section 3.15 Maintenance of Certain Servicing Insurance Policies....17
Section 3.16 Information Required by the Internal Revenue
Service and Reports of Foreclosures and
Abandonments of Mortgaged Property.....................18
Section 3.17 Assignments; Recordings of Assignments.................18
Section 3.18 [Reserved].............................................19
-i-
Section 3.19 Funding Account and Distribution Account...............19
Section 3.20 [Reserved].............................................20
Section 3.21 P&I Advances...........................................20
Section 3.22 Transfer of Mortgage Loans.............................20
ARTICLE IV Servicing Certificate........................................22
Section 4.01 Statements to Securityholders..........................22
Section 4.02 Tax Returns and 1934 Act Reports.......................24
Section 4.03 Exchange Act Reporting.................................24
ARTICLE V Note Payment Account.........................................25
Section 5.01 Note Payment Account...................................25
ARTICLE VI The Servicer.................................................25
Section 6.01 Liability of the Servicer..............................25
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer...........................25
Section 6.03 Limitation on Liability of the Servicer and Others.....26
Section 6.04 Servicer Not to Resign.................................27
Section 6.05 Delegation of Duties...................................27
Section 6.06 Payment of Indenture Trustee's, the Paying Agent's
and Owner Trustee's Fees and Expenses;
Indemnification........................................27
ARTICLE VII Default......................................................29
Section 7.01 Servicing Default......................................29
Section 7.02 Indenture Trustee to Act; Appointment of Successor.....31
Section 7.03 Notification to Securityholders........................32
ARTICLE VIII Miscellaneous Provisions.....................................33
Section 8.01 Amendment..............................................33
Section 8.02 Exhibits...............................................33
Section 8.03 GOVERNING LAW..........................................33
Section 8.04 Notices................................................33
Section 8.05 Severability of Provisions.............................34
Section 8.06 Protection of Confidential Information.................34
-ii-
Section 8.07 Third-Party Beneficiaries..............................34
Section 8.08 Counterparts...........................................34
Section 8.09 Effect of Headings and Table of Contents...............34
Section 8.10 Termination upon Purchase by the Servicer or
Liquidation of All Mortgage Loans; Partial
Redemption.............................................34
Section 8.11 Certain Matters Affecting the Indenture Trustee
and the Paying Agent...................................35
Section 8.12 Owner Trustee, Paying Agent and Indenture Trustee
Not Liable for Related Documents.......................35
ARTICLE IX Compliance with Regulation AB................................35
Section 9.01 Intent of the Parties; Reasonableness..................35
Section 9.02 Additional Representations and Warranties of the
Indenture Trustee......................................35
Section 9.03 Information to be provided by the Indenture Trustee....35
Section 9.04 Report on Assessment of Compliance and Attestation.....35
Section 9.05 Indemnification; Remedies..............................35
EXHIBITS
EXHIBIT A - MORTGAGE LOAN SCHEDULE.........................................A-1
EXHIBIT B - COLLECTION POLICY..............................................B-1
EXHIBIT C - LIMITED POWER OF ATTORNEY......................................C-1
EXHIBIT D - FORM OF REQUEST FOR RELEASE....................................D-1
EXHIBIT E - FORM OF FORM 10-K CERTIFICATE..................................E-1
EXHIBIT F - FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE.........F-1
EXHIBIT G - SERVICING CRITERIA.............................................G-1
-iii-
This Servicing Agreement, dated as of _____ __, 200_ (the "Agreement"),
is among Wachovia Bank, National Association, as servicer (the "Servicer"),
the Wachovia Mortgage Loan Trust, LLC [______] Trust, as issuer (the
"Issuer"), Wachovia Bank, National Association, as Paying Agent (the "Paying
Agent"), and [_________________], as indenture trustee (the "Indenture
Trustee").
WITNESSETH:
WHEREAS, pursuant to the terms of the Purchase Agreement (as defined
herein), Wachovia Bank, National Association, as seller (in such capacity,
"Seller") and as servicer, will sell to Wachovia Mortgage Loan Trust, LLC, as
purchaser (in such capacity, the "Purchaser"), the Initial Mortgage Loans on
the Closing Date, and may sell Subsequent Mortgage Loans on one or more
Subsequent Transfer Dates, together with the Related Documents on the Closing
Date and any Subsequent Transfer Date, and thereafter all Additional Balances
created on or after the Cut-Off Date and any such Subsequent Transfer Date;
WHEREAS, Wachovia Mortgage Loan Trust, LLC, as depositor (in such
capacity, the "Depositor"), will sell the Initial Mortgage Loans and assign
all of its rights under the Purchase Agreement to the Issuer, together with
the Related Documents on the Closing Date, and thereafter Subsequent Mortgage
Loans and Additional Balances relating to the Mortgage Loans created on or
after the Cut-Off Date;
WHEREAS, pursuant to the terms of the Trust Agreement, the Issuer will
issue the Certificates;
WHEREAS, pursuant to the terms of the Indenture, the Issuer will issue
the Notes; and
WHEREAS, pursuant to the terms of this Agreement, the Servicer will
service the Mortgage Loans directly or through one or more Subservicers.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE I
Definitions
Section 1.01 Definitions. For all purposes of this Agreement, except as
otherwise expressly provided herein or unless the context otherwise requires,
capitalized terms not otherwise defined herein shall have the meanings
assigned to such terms in the Definitions contained in Appendix A to the
indenture dated as of _____ __, 200_ (the "Indenture"), among the Issuer, the
Paying Agent and the Indenture Trustee, which is incorporated by reference
herein. All other capitalized terms used herein shall have the meanings
specified herein.
Section 1.02 Other Definitional Provisions.
(a) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant
hereto unless otherwise defined therein.
1
(b) As used in this Agreement and in any certificate or other document made
or delivered pursuant hereto or thereto, accounting terms not defined in this
Agreement or in any such certificate or other document, and accounting terms
partly defined in this Agreement or in any such certificate or other
document, to the extent not defined, shall have the respective meanings given
to them under generally accepted accounting principles. To the extent that
the definitions of accounting terms in this Agreement or in any such
certificate or other document are inconsistent with the meanings of such
terms under generally accepted accounting principles, the definitions
contained in this Agreement or in any such certificate or other document
shall control.
(c) The words "hereof," "herein," "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not
to any particular provision of this Agreement; Section and Exhibit references
contained in this Agreement are references to Sections and Exhibits in or to
this Agreement unless otherwise specified; the term "including" shall mean
"including without limitation"; "or" shall include "and/or"; and the term
"proceeds" shall have the meaning ascribed thereto in the UCC.
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as
well as the feminine and neuter genders of such terms.
(e) Any agreement, instrument or statute defined or referred to herein or
in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments)
references to all attachments thereto and instruments incorporated therein;
references to a Person are also to its permitted successors and assigns.
Section 1.03 Interest Calculations. All calculations of interest
hereunder that are made in respect of the Principal Balance of a Mortgage
Loan shall be made on a daily basis using a 365-day year. All calculations
of interest on the Notes shall be made on the basis of the actual number of
days in an Interest Period and a year assumed to consist of 360-days. The
calculation of the Servicing Fee shall be made on the basis of a 360-day year
consisting of twelve 30-day months. All dollar amounts calculated hereunder
shall be rounded to the nearest xxxxx with one-half of one xxxxx being
rounded up.
ARTICLE II
Representations and Warranties
Section 2.01 Representations and Warranties Regarding the Servicer. The
Servicer represents and warrants to the Issuer, the Enhancer and for the
benefit of the Indenture Trustee, as pledgee of the Mortgage Loans, as of the
Closing Date:
(a) The Servicer is a national banking association duly organized and
validly existing under the laws of the United States of America and is or
will be in compliance with the laws of each state in which any Mortgaged
Property is located to the extent necessary to ensure the enforceability of
each Mortgage Loan;
2
(b) The Servicer has the power and authority to make, execute, deliver and
perform its obligations under this Agreement and all of the transactions
contemplated under this Agreement, has taken all necessary corporate action
to authorize the execution, delivery and performance of this Agreement, and
has duly executed and delivered this Agreement;
(c) The Servicer is not required to obtain the consent of any other Person
or any consents, licenses, approvals or authorizations from, or registrations
or declarations with, any governmental authority, bureau or agency in
connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except for such consents, licenses,
approvals or authorizations, or registrations or declarations, as shall have
been obtained or filed, as the case may be;
(d) The execution and delivery of this Agreement by the Servicer and the
performance and compliance with the terms of this Agreement by the Servicer
will not violate the Articles of Association or Bylaws of the Servicer, or
constitute a material default (or an event which, with notice or lapse of
time, or both, would constitute a material default) under, or result in the
material breach of, any material contract, agreement or other instrument to
which the Servicer is a party or which may be applicable to the Servicer or
any of its respective assets;
(e) No litigation is currently pending, or to the knowledge of the Servicer
threatened, against the Servicer, that in the opinion of the Servicer has a
reasonable likelihood of resulting in a material adverse effect on the
transactions contemplated by this Agreement;
(f) This Agreement constitutes a legal, valid and binding obligation of the
Servicer, enforceable against the Servicer in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights in general, as they may be applied in the context of the
insolvency of a national banking association, and by general equity
principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law), and by public policy considerations
underlying the securities laws, to the extent that such public policy
considerations limit the enforceability of the provisions of this Agreement
which purport to provide indemnification from liabilities under applicable
securities laws; and
(g) The Servicer is not in default with respect to any order or decree of
any court or any order, regulation or demand of any federal, state, municipal
or governmental agency, which default might have consequences that would
materially and adversely affect the condition (financial or otherwise) or
operations of the Servicer or its respective properties or might have
consequences that would materially adversely affect the respective
performance of the Servicer hereunder.
The foregoing representations and warranties shall survive any
termination of the Servicer hereunder.
Section 2.02 Representations and Warranties of the Issuer. The Issuer
hereby represents and warrants to the Servicer and for the benefit of the
Indenture Trustee, as pledgee of the Mortgage Loans, as of the Closing Date:
(a) the Issuer is a statutory trust duly formed and in good standing under
the laws of the State of Delaware and has full power, authority and legal
right to execute and deliver this Agreement and to perform its obligations
under this Agreement, and has taken all necessary action to authorize the
execution, delivery and performance by it of this Agreement; and
3
(b) the execution and delivery by the Issuer of this Agreement and the
performance by the Issuer of its obligations under this Agreement will not
violate any provision of any law or regulation governing the Issuer or any
order, writ, judgment or decree of any court, arbitrator or governmental
authority or agency applicable to the Issuer or any of its assets. Such
execution, delivery, authentication and performance will not require the
authorization, consent or approval of, the giving of notice to, the filing or
registration with, or the taking of any other action with respect to, any
governmental authority or agency regulating the activities of limited
liability companies. Such execution, delivery, authentication and
performance will not conflict with, or result in a breach or violation of,
any mortgage, deed of trust, lease or other agreement or instrument to which
the Issuer is bound.
Section 2.03 Enforcement of Representations and Warranties. The
Servicer, on behalf of and subject to the direction of the Indenture Trustee,
as pledgee of the Mortgage Loans, or the Issuer, shall enforce the
representations and warranties of the Seller pursuant to the Purchase
Agreement. Upon the discovery by the Seller, the Depositor, the Servicer,
the Indenture Trustee, the Enhancer or the Issuer of a breach of any of the
representations and warranties made by the Seller in the Purchase Agreement,
in respect of any Mortgage Loan which materially and adversely affects the
interests of the Securityholders or the Enhancer, the party discovering such
breach shall give prompt written notice to the other parties. The Servicer
shall promptly notify the Seller of such breach and request that, pursuant to
the terms of the Purchase Agreement, the Seller either (i) cure such breach
in all material respects within 90 days from the date the Seller was notified
of such breach or (ii) purchase such Mortgage Loan from the Issuer at the
price and in the manner set forth in Section 3.1(d) of the Purchase
Agreement; provided, however, that the Seller shall, subject to the
conditions set forth in the Purchase Agreement, have the option to substitute
an Eligible Substitute Loan or Loans for such Mortgage Loan. In the event
that the Seller elects to substitute one or more Eligible Substitute Loans
pursuant to Section 3.1(d) of the Purchase Agreement, the Seller shall
deliver to the Servicer, in accordance with the Purchase Agreement, with
respect to such Eligible Substitute Loans, the original Loan Agreement, the
Mortgage, and such other documents and agreements as are required by the
Purchase Agreement. Payments due with respect to Eligible Substitute Loans
in the month of substitution shall not be transferred to the Issuer and will
be retained by the Servicer and remitted by the Servicer to the Seller on the
next succeeding Payment Date except to the extent that a payment less than
the applicable Minimum Monthly Payment has been received by the Issuer for
such month in respect of the Mortgage Loan to be removed. The Servicer shall
amend or cause to be amended the Mortgage Loan Schedule to reflect the
removal of such Mortgage Loan and the substitution of the Eligible Substitute
Loans and the Servicer shall promptly deliver the amended Mortgage Loan
Schedule to the Owner Trustee and Indenture Trustee.
It is understood and agreed that the obligation of the Seller to cure
such breach or purchase or substitute for such Mortgage Loan as to which such
a breach has occurred and is continuing shall constitute the sole remedy
respecting such breach available to the Issuer and the Indenture Trustee, as
pledgee of the Mortgage Loans, against the Seller. In connection with the
purchase of or substitution for any such Mortgage Loan by the Seller, the
Issuer shall assign to the Seller all of its right, title and interest in
respect of the Purchase Agreement applicable to such Mortgage Loan.
4
ARTICLE III
Administration and Servicing of Mortgage Loans
Section 3.01 The Servicer.
(a) The Issuer, by execution and delivery of this Agreement, does hereby
appoint the Servicer for, and subject to the terms of this Agreement, the
Servicer assumes responsibility for, the servicing of the Mortgage Loans.
Each original Mortgage File and any Related Documents delivered to the
Servicer by the Seller pursuant to the provisions of this Agreement and any
Subsequent Transfer Agreement shall be held in trust by the Servicer for the
benefit of the Trust in accordance with the terms of this Agreement. The
Servicer's possession of any portion of any original Mortgage File, any
Related Documents or copies thereof shall be maintained in accordance with
the provisions of this Agreement to facilitate the servicing of the related
Mortgage Loans pursuant to this Agreement.
(b) The Servicer shall service and administer the Mortgage Loans in a
manner generally consistent with the terms of this Agreement and the
collection policy set forth on Exhibit B (the "Collection Policy") and in a
manner that shall be normal and usual in its mortgage servicing activities.
Subject to the Collection Policy and the terms of this Agreement (including
without limitation Sections 3.08 and 3.09), the Servicer shall have full
power and authority to do any and all things in connection with such
servicing and administration which it may deem necessary or desirable, it
being understood, however, that the Servicer shall at all times remain
responsible to the Issuer, the Paying Agent, the Indenture Trustee and, as a
third-party beneficiary hereunder, the Enhancer for the performance of its
duties and obligations hereunder.
The Servicer will at all times apply the same standards and follow the
same procedures with respect to the decision to commence litigation, and in
prosecuting and litigating with respect to the Mortgage Loans as it applies
and follows with respect to mortgage loans like the Mortgage Loans generally.
(c) The Servicer shall enforce the respective rights and interests of the
Issuer and the Indenture Trustee in and under each Mortgage Loan, including
the Mortgaged Property and any other related security. The Servicer is
hereby authorized and empowered, in performing its duties hereunder, subject
to the limitations set forth herein, to execute and deliver, on behalf of
itself, the Issuer, the Indenture Trustee or any of them, any and all
instruments of satisfaction or cancellation, or of partial or full release or
discharge and all other comparable instruments with respect to the Mortgage
Loans and the Mortgaged Properties. The Issuer and the Indenture Trustee, as
applicable, shall execute any powers of attorney and other documents
furnished to them by the Servicer and necessary or appropriate to enable the
Servicer to carry out its servicing and administrative duties hereunder. In
addition, the Servicer may, at its own discretion, obtain credit information
in the form of a "credit score" from a credit repository. On the Closing
Date, the Indenture Trustee shall deliver to the Servicer a limited power of
attorney substantially in the form of Exhibit C hereto.
No costs incurred by the Servicer in respect of Servicing Advances
shall, for the purposes of distributions to the Noteholders, be added to the
amount owing under the related Mortgage Loan.
5
Notwithstanding anything to the contrary contained herein, the
Servicer, in servicing and administering the Mortgage Loans, shall employ or
cause to be employed procedures (including collection, foreclosure and
management procedures with respect to REO Property) and exercise the same
care that it customarily employs and exercises in servicing and administering
mortgage loans for its own account, in accordance with accepted mortgage
servicing practices of prudent lending institutions servicing mortgage loans
similar to the Mortgage Loans and giving due consideration to the
Noteholders', the Enhancer's and the Trust's reliance on the Servicer.
If the Mortgage did not have a Lien senior to the related Mortgage Loan
on the related Mortgaged Property as of the Cut-Off Date or related
Subsequent Cut-Off Date, as applicable, then the Servicer, in such capacity,
may not consent to the placing of a Lien senior to that of the Mortgage on
the related Mortgaged Property. If the Mortgage had a Lien senior to the
related Mortgage Loan on the related Mortgaged Property as of the Cut-Off
Date or related Subsequent Cut-Off Date, as applicable, then the Servicer, in
such capacity, may consent to the refinancing of such prior senior Lien,
provided that (i) the resulting CLTV of such Mortgage Loan is no higher than
the greater of the CLTV prior to such refinancing or 100%; (ii) the interest
rate for the loan evidencing the refinanced senior Lien is no higher than the
interest rate on the loan evidencing the existing senior Lien immediately
prior to the date of such refinancing (meaning, in the case of an adjustable
rate loan, a substantially similar index and a gross margin no higher than
that of the existing senior Lien); and (iii) the loan evidencing the
refinanced senior Lien is not subject to negative amortization.
In connection with servicing the Mortgage Loans, the Servicer may take
reasonable actions to encourage or effect the termination of Loan Agreements
that have become dormant.
The relationship of the Servicer (and of any successor to the Servicer
as servicer under this Agreement) to the Issuer, the Paying Agent and the
Indenture Trustee under this Agreement is intended by the parties to be that
of an independent contractor and not that of a joint venturer, partner or
agent.
(d) The Servicer may enter into Subservicing Agreements with Subservicers
for the servicing and administration of certain of the Mortgage Loans,
provided that notwithstanding such appointment, the Servicer shall remain
liable for the performance of all servicing duties delegated by it. The
Servicer shall provide written notice to the Indenture Trustee, the Paying
Agent and the Enhancer upon entering into a Subservicing Agreement.
References in this Agreement to actions taken or to be taken by the Servicer
in servicing the Mortgage Loans include actions taken or to be taken by a
Subservicer on behalf of the Servicer and any amount actually received by
such Subservicer in respect of a Mortgage Loan shall be deemed to have been
received by the Servicer whether or not actually received by the Servicer.
Each Subservicing Agreement will be upon such terms and conditions as are not
inconsistent with this Agreement and as the Servicer and the Subservicer have
agreed. With the approval of the Servicer, a Subservicer may delegate its
servicing obligations to third-party servicers, but such Subservicers will
remain obligated under the related Subservicing Agreements. The Servicer and
the Subservicer may enter into amendments to the related Subservicing
Agreements; provided, however, that any such amendments shall not cause the
Mortgage Loans to be serviced in a manner that would be materially
inconsistent with the standards set forth in this Agreement. The Servicer
shall be entitled to terminate any Subservicing Agreement in accordance with
the terms and conditions thereof and without any limitation by virtue of this
Agreement; provided, however, that in the event of termination of any
Subservicing Agreement by the Servicer or the Subservicer, the Servicer shall
either act as servicer of the related Mortgage Loan or enter into a
Subservicing Agreement with a successor Subservicer which will be bound by
the terms of the related Subservicing Agreement. The Servicer shall be
entitled to enter into any agreement with a Subservicer for indemnification
of the Servicer and nothing contained in this Agreement shall be deemed to
limit or modify such indemnification.
6
In the event that the rights, duties and obligations of the Servicer
are terminated hereunder, any successor to the Servicer in its sole
discretion may, to the extent permitted by applicable law, terminate the
existing Subservicing Agreement with any Subservicer in accordance with the
terms of the applicable Subservicing Agreement or assume the terminated
Servicer's rights and obligations under such subservicing arrangements which
termination or assumption will not violate the terms of such arrangements.
As part of its servicing activities hereunder, the Servicer, for the
benefit of the Indenture Trustee, the Paying Agent, the Enhancer and the
Securityholders, shall use reasonable efforts to enforce the obligations of
each Subservicer under the related Subservicing Agreement, to the extent that
the non-performance of any such obligation would have a material adverse
effect on a Mortgage Loan. Such enforcement, including, without limitation,
the legal prosecution of claims, termination of Subservicing Agreements and
the pursuit of other appropriate remedies, shall be in such form and carried
out to such an extent and at such time as the Servicer, in its good faith
business judgment, would require were it the owner of the related Mortgage
Loans. The Servicer shall pay the costs of such enforcement at its own
expense, and shall be reimbursed therefor only (i) from a general recovery
resulting from such enforcement to the extent, if any, that such recovery
exceeds all amounts due in respect of the related Mortgage Loan or (ii) from
a specific recovery of costs, expenses or attorneys fees against the party
against whom such enforcement is directed.
Section 3.02 Collection of Certain Mortgage Loan Payments.
(a) The Servicer shall make reasonable efforts to collect all payments
called for under the terms and provisions of the Mortgage Loans, and shall,
to the extent such procedures shall be consistent with this Agreement and
generally consistent with the Collection Policy, follow such collection
procedures as shall be normal and usual in its general mortgage servicing
activities and consistent with the procedures the Servicer employs in
servicing all other Mortgage Loans in the servicing portfolio with
characteristics similar to those of the Mortgage Loans. Consistent with the
foregoing, and without limiting the generality of the foregoing, the Servicer
may in its discretion (i) waive any late payment charge, penalty interest or
other fees which may be collected in the ordinary course of servicing a
Mortgage Loan and (ii) arrange with a Mortgagor a schedule for the payment of
principal and interest due and unpaid; provided, however, that such
arrangement is consistent with the Servicer's policies with respect to home
equity mortgage loans. The Servicer may also extend the Due Date for payment
due on a Mortgage Loan in accordance with the Collection Policy; provided,
however, that the Servicer shall first determine that any such waiver or
extension will not impair the coverage of any related insurance policy or
materially adversely affect the Lien of the related Mortgage or the interests
of the Securityholders or the Enhancer, and the Servicer shall not grant any
such waiver or extension that would have any such effect. Consistent with
the terms of this Agreement, the Servicer may also:
(i) waive, modify or vary any term of any Mortgage Loan (including reduce
the Credit Limit);
7
(ii) consent to the postponement of strict compliance with any such term or
in any manner grant indulgence to any Mortgagor;
(iii) arrange with a Mortgagor a schedule for the payment of principal and
interest due and unpaid;
(iv) forgive any portion of the amounts contractually owed under the
Mortgage Loan;
(v) capitalize past due amounts owed under the Mortgage Loan by adding any
amounts in arrearage to the existing principal balance of the Mortgage Loan
(a "Capitalization Workout") which will result in an increased monthly
payment amount, provided that: (A) the amount added to the existing principal
balance of the Mortgage Loan (the "Capitalized Amount") shall be no greater
than five times the Mortgagor's current Minimum Monthly Payment amount; and
(B) the Servicer shall not enter into a Capitalization Workout unless the
CLTV of the Mortgage Loan prior to the Capitalization Workout equals or
exceeds 80% and the Mortgagor has qualified for the Capitalization Workout
under the Servicer's servicing guidelines; or
(vi) reset the maturity date for the Mortgage Loan, but in no event shall
such reset date extend beyond the end of the Collection Period preceding the
Final Payment Date;
or any combination of the foregoing, if in the Servicer's determination such
waiver, modification, postponement or indulgence is not materially adverse to
the interests of the Securityholders or the Enhancer; provided, however, that
the Servicer may not, pursuant to this Section 3.02, modify or permit any
Subservicer to modify any Mortgage Loan (including without limitation any
modification that would change the Loan Rate, forgive the payment of any
principal or interest (unless in connection with the liquidation of the
related Mortgage Loan) or extend the final maturity date of such Mortgage
Loan) unless such Mortgage Loan is in default or, in the judgment of the
Servicer, such default is reasonably foreseeable or except as provided in
Section 3.06. In connection with any such waiver, modification, postponement
or indulgence, the Servicer shall use reasonable efforts to maximize the
receipt of principal and interest thereon. The general terms of any waiver,
modification, forgiveness, postponement or indulgence with respect to any of
the Mortgage Loans will be included in the Servicing Certificate, and such
Mortgage Loans will not be considered "delinquent" for the purposes of the
Basic Documents so long as the Mortgagor complies with the terms of such
waiver, modification, forgiveness, postponement or indulgence.
Section 3.03 Custodial Duties
(a) The Servicer is hereby appointed as custodian of the documents in each
Mortgage File.
(b) The Servicer shall establish the Custodial Account, which shall be an
Eligible Account, titled "Wachovia Mortgage Loan Trust, LLC [______] Trust
Custodial Account," in which the Servicer or the Issuer, as applicable, shall
deposit or cause to be deposited any amounts representing payments and
collections in respect of the Mortgage Loans received by it subsequent to the
applicable Cut-Off Date or Subsequent Cut-Off Date (other than in respect of
the payments referred to in the following paragraph), within one Business Day
following receipt thereof (or otherwise on or prior to the Closing Date),
including the following payments and collections received or made by it
(without duplication):
8
(i) all payments of principal of or interest on the Mortgage Loans (other
than amounts in respect of the Excluded Amount) received or advanced by the
Servicer, net of any portion of the interest thereof retained by any
Subservicer as subservicing fees;
(ii) Net Liquidation Proceeds (net of any related Foreclosure Profit) and
all Subsequent Recovery Amounts;
(iii) all proceeds of any Mortgage Loans repurchased by the Seller pursuant
to the Purchase Agreement, including any indemnity payments paid by the
Seller pursuant to Section 3.1(d) of the Purchase Agreement, and all
Substitution Adjustment Amounts required to be deposited in connection with
the substitution of an Eligible Substitute Loan pursuant to the Purchase
Agreement;
(iv) Insurance Proceeds, other than Net Liquidation Proceeds, resulting from
any insurance policy maintained on a Mortgaged Property;
(v) REO proceeds and Condemnation Proceeds; and
(vi) amounts required to be paid by the Servicer pursuant to Section 8.10;
provided, however, that with respect to each Collection Period, the Servicer
shall be permitted to retain from payments in respect of interest on the
Mortgage Loans, the Servicing Fee for such Collection Period. The foregoing
requirements respecting deposits to the Custodial Account are exclusive, it
being understood that, without limiting the generality of the foregoing, the
Servicer need not deposit in the Custodial Account amounts representing
Foreclosure Profits, fees (including annual fees) or late charge penalties,
payable by Mortgagors (such amounts to be retained as additional servicing
compensation in accordance with Section 3.10 hereof), or amounts received by
the Servicer for the accounts of Mortgagors for application towards the
payment of taxes, insurance premiums, assessments and similar items. In the
event any amount not required to be deposited in the Custodial Account is so
deposited, the Servicer may at any time withdraw such amount from the
Custodial Account, any provision herein to the contrary notwithstanding, and
pay such amount to the Person entitled to such amount. The Servicer shall
retain all Foreclosure Profits as additional servicing compensation.
Payments and collections allocable to an Excluded Amount shall not be
deposited into the Custodial Account, the Distribution Account or the Note
Payment Account, but shall be distributed by the Servicer to the Seller
pursuant to Section 3.04.
If the Servicer makes any P&I Advances pursuant to Section 3.21 the
Servicer shall be entitled to reimbursement itself by withdrawing from the
Custodial Account, as provided herein, any amounts so advanced. The Servicer
may cause the institution maintaining the Custodial Account to invest any
funds in the Custodial Account in Permitted Investments, which investments
shall mature not later than the Business Day preceding the next succeeding
Payment Date, and which investments shall not be sold or disposed of prior to
maturity. In addition, no such Permitted Investment shall be purchased at a
price in excess of par. Except as provided above, all income and gain
realized from any such investment shall inure to the benefit of the Servicer
and shall be subject to its withdrawal or order from time to time. The
amount of any losses incurred in respect of the principal amount of any such
investments shall be deposited in the Custodial Account by the Servicer out
of its own funds immediately as realized.
9
(c) The Servicer shall promptly report in writing to the Owner Trustee, the
Paying Agent and the Indenture Trustee any material failure on the Servicer's
part to hold the Mortgage Files and maintain its records and computer systems
as herein provided and promptly take appropriate action to remedy any such
failure. Following the occurrence of a Servicing Default as set forth in
Section 7.01(a)(iii) or (iv), the Issuer or the Indenture Trustee shall
immediately terminate the rights of the Servicer to perform the duties as
custodian with respect to the Mortgage Files for the Mortgage Loans.
Following the occurrence of a Servicing Default as set forth in
Section 7.01(a)(i) or (ii), the Issuer or the Indenture Trustee shall, upon
60 days prior written notice, terminate the rights of the Servicer to perform
the duties as custodian with respect to the Mortgage Files for the Mortgage
Loans. Upon the termination of the Servicer's rights to perform the duties
as custodian with respect to any Mortgage Files, the Servicer shall deliver
each such Mortgage File to the Indenture Trustee or its designee in
accordance with the instructions of the Indenture Trustee.
(d) Upon taking possession of the Mortgage Files, the Servicer shall (i)
maintain possession of the Mortgage Files and (ii) exercise the same degree
of care with respect to the possession of the Mortgage Files as it would if
they were its own property. The Mortgage Files shall at all times be held by
the Servicer segregated from any similar documents. In performing its duties
as custodian, the Servicer shall act with reasonable care, using that degree
of skill and attention that other servicers exercise with respect to the loan
files relating to all comparable loans that they service. Mortgage Files
shall be held for the benefit of the Indenture Trustee, the Enhancer and the
Securityholders.
Section 3.04 Withdrawals from the Custodial Account. The Servicer
shall, from time to time as provided herein, make withdrawals from the
Custodial Account of amounts on deposit therein pursuant to Section 3.02 that
are attributable to the Mortgage Loans for the following purposes:
(a) on each Determination Date, the Servicer shall determine the pro rata
portion of the Interest Collections deposited into the Custodial Account with
respect to the related Collection Period that relate to the Additional
Balance Increase Amount and, prior to 1:00 p.m. (EST) on the Business Day
prior to the related Payment Date, the Servicer shall withdraw such amounts
from the Custodial Account and deposit such amounts into the Distribution
Account established by the Certificate Paying Agent for distribution to the
Certificateholders pursuant to Section 5.01 of the Trust Agreement;
(b) on each Determination Date, the Servicer shall determine the aggregate
amounts to be withdrawn from the Custodial Account and applied pursuant to
Section 3.05(a) of the Indenture and, prior to 1:00 p.m. (EST) on the
Business Day prior to the related Payment Date, the Servicer shall withdraw
such amounts from the Custodial Account and deposit such amounts into the
Note Payment Account, the Funding Account or the Distribution Account, as
applicable, for distribution by the Paying Agent, in each case in accordance
with Section 3.05 of the Indenture and in the order of priority set forth in
Section 3.05(a) of the Indenture for such Payment Date and in accordance with
the Servicing Certificate;
10
(c) to pay to the Seller any monthly payments received from the Mortgagors
that do not constitute Transferred Property;
(d) prior to the commencement of the Rapid Amortization Period, from
Principal Collections on the Mortgage Loans, and, on and after the Payment
Date in ______ 200_, if Principal Collections are not sufficient from Excess
Spread, to pay to the Seller, as assignee of the Depositor, the amount of any
Additional Balances, as and when created during the related Collection
Period, but only to the extent that amounts on deposit in the Funding Account
are not sufficient for such purpose; provided that Excess Spread shall not be
so applied if the Enhancer has not been reimbursed for all draws made under
the Policy, with interest; and provided further that Excess Spread
(calculated with respect to the following Payment Date) in the Custodial
Account will not be applied to purchase Additional Balances to the extent
that after such purchase the Overcollateralization Amount would exceed the
Overcollateralization Target Amount, calculated in each case as of the
following Payment Date;
(e) to the extent deposited to the Custodial Account, to reimburse itself
or the related Subservicer for previously unreimbursed expenses incurred in
maintaining individual insurance policies pursuant to Section 3.05, for
Servicing Advances, for fees payable pursuant to Section 3.08, for expenses
payable pursuant to Section 3.10, for amounts reimbursable pursuant to
Section 6.03 or Liquidation Expenses, paid pursuant to Section 3.08 or
otherwise reimbursable pursuant to the terms of this Agreement (to the extent
not payable pursuant to Section 3.10), such withdrawal right being limited to
amounts received on particular Mortgage Loans (other than any Repurchase
Price in respect thereof) that represent late recoveries of the payments for
which such advances were made, or from related Net Liquidation Proceeds or
the proceeds of the purchase of such Mortgage Loan;
(f) to pay itself an amount equal to the related Servicing Fee (to the
extent not retained pursuant to Section 3.03);
(g) to the extent deposited in the Custodial Account, to pay to the
Servicer as additional servicing compensation any (i) interest or investment
income earned on funds deposited in the Custodial Account that it is entitled
to withdraw pursuant to Section 3.03, and (ii) Foreclosure Profits (to the
extent permitted by law);
(h) to pay to the Seller, with respect to any Mortgage Loan or property
acquired in respect thereof that has been purchased or otherwise transferred
to the Seller, the Servicer or other entity, all amounts received thereon and
not required to be distributed to Securityholders as of the date on which the
related Purchase Price or Repurchase Price is determined;
(i) to withdraw any other amount, determined without duplication with
respect to an other amount provided for in this Section 3.04, deposited in
the Custodial Account that was not required to be deposited therein pursuant
to Section 3.03;
(j) to pay to the Servicer, with respect to any Mortgage Loan for which the
Servicer has made a P&I Advance that has not been previously reimbursed to
the extent of receipts of late recoveries of such payments from the related
Mortgagor, out of related Net Liquidation Proceeds or the proceeds of the
purchase of such Mortgage Loan; and
11
(k) to reimburse the Servicer for any advances or expenses that have not
been previously reimbursed pursuant to such clauses (e) or (j).
Since, in connection with withdrawals pursuant to clauses (c), (e),
(f), (h) and (j), the Servicer's entitlement thereto is limited to
collections or other recoveries on the related Mortgage Loan, the Servicer
shall keep and maintain separate accounting, on a Mortgage Loan by Mortgage
Loan basis, for the purpose of justifying any withdrawal from the Custodial
Account pursuant to such clauses. Notwithstanding any other provision of
this Agreement, the Servicer shall be entitled to be reimbursed itself for
any previously unreimbursed expenses incurred pursuant to Section 3.08 or
otherwise reimbursable pursuant to the terms of this Agreement that the
Servicer determines to be otherwise nonrecoverable, by withdrawal from the
Custodial Account of amounts on deposit therein attributable to the Mortgage
Loans on any Business Day prior to the Payment Date succeeding the date of
such determination.
If any deposit required to be made by the Servicer pursuant to Section
3.04(b) is not made when due, the Servicer shall pay to the Paying Agent, out
of the Servicer's own funds, one day of interest on such late payment, at a
per annum rate equal to the effective Federal Funds Rate for such date. Such
interest shall be remitted to the Paying Agent on the same day that the
Servicer remits the late remittance to the Paying Agent.
Section 3.05 Maintenance of Hazard Insurance; Property Protection
Expenses. To the extent permitted under the related Loan Agreement and
Mortgage, and to the extent the Servicer receives notice that a hazard
insurance policy has been cancelled, the Servicer shall cause to be
maintained for each Mortgage Loan hazard insurance naming the Servicer or
related Subservicer as loss payee thereunder providing extended coverage in
an amount which is at least equal to the lesser of (i) the maximum insurable
value of the improvements securing such Mortgage Loan from time to time or
(ii) the combined principal balance owing on such Mortgage Loan and any
mortgage loan senior to such Mortgage Loan from time to time; provided,
however, that such coverage may not be less than the minimum amount required
to fully compensate for any loss or damage on a replacement cost basis. The
Servicer shall use its best efforts to monitor that hazard insurance is
maintained as described in the previous sentence in the same manner as it
would for mortgage loans in its own portfolio. The Servicer shall cause to
be maintained on property acquired upon foreclosure, or deed in lieu of
foreclosure, of any Mortgage Loan, fire insurance with extended coverage in
an amount which is at least equal to the amount necessary to avoid the
application of any co-insurance clause contained in the related hazard
insurance policy, the premium for which shall be a Servicing Advance within
the meaning of Section 3.08. Amounts collected by the Servicer under any
such policies (other than amounts to be applied to the restoration or repair
of the related Mortgaged Property or property thus acquired or amounts
released to the Mortgagor in accordance with the Servicer's normal servicing
procedures) shall be deposited in the Custodial Account to the extent called
for by Section 3.03. In cases in which any Mortgaged Property is located at
any time during the life of a Mortgage Loan in a federally designated flood
area, to the extent permitted under the related Loan Agreement and Mortgage,
and to the extent the Servicer receives notice that the related flood
insurance has been cancelled, the hazard insurance to be maintained for the
related Mortgage Loan shall include flood insurance (to the extent
available). All such flood insurance shall be in amounts equal to the lesser
of (i) the amount required to compensate for any loss or damage to the
related Mortgaged Property on a replacement cost basis and (ii) the maximum
amount of such insurance available for such Mortgaged Property under the
national flood insurance program (assuming that the area in which such
Mortgaged Property is located is participating in such program). The
Servicer shall use its best efforts to monitor such flood insurance as
described in the previous sentence in the same manner as it would for
mortgage loans in its own portfolio. The Servicer shall be under no
obligation to require that any Mortgagor maintain earthquake or other
additional insurance and shall be under no obligation itself to maintain any
such additional insurance on property acquired in respect of a Mortgage Loan,
other than pursuant to such applicable laws and regulations as shall at any
time be in force and as shall require such additional insurance. If the
Servicer shall obtain and maintain a blanket policy consistent with its
general mortgage servicing activities insuring against hazard losses on all
of the Mortgage Loans, it shall conclusively be deemed to have satisfied its
obligations as set forth in the first sentence of this Section 3.05, it being
understood and agreed that such policy may contain a deductible clause, in
which case the Servicer shall, in the event that there shall not have been
maintained on the related Mortgaged Property a policy complying with the
first sentence of this Section 3.05 and there shall have been a loss which
would have been covered by such policy, deposit in the Custodial Account the
amount of such loss that would have otherwise been covered. Any such deposit
by the Servicer shall be made on the last Business Day of the Collection
Period in the month in which payments under any such policy would have been
deposited in the Custodial Account. In connection with its activities as
servicer of the Mortgage Loans, the Servicer agrees to present, on behalf of
itself, the Issuer and the Indenture Trustee, claims under any such blanket
policy.
12
Section 3.06 Modification Agreements.
(a) The Servicer or the related Subservicer, as the case may be, shall be
entitled to (a) execute assumption agreements, substitution agreements, and
instruments of satisfaction or cancellation or of partial or full release or
discharge, or any other document contemplated by this Agreement and other
comparable instruments with respect to the Mortgage Loans and with respect to
the related Mortgaged Properties (and the Issuer and the Indenture Trustee
each shall promptly execute any such documents on request of the Servicer)
and (b) approve the granting of an easement thereon in favor of another
Person, any alteration or demolition of such Mortgaged Properties or other
similar matters, if it has determined, exercising its good faith business
judgment in the same manner as it would if it were the owner of the related
Mortgage Loans, that the security for, and the timely and full collectability
of, such Mortgage Loans would not be adversely affected thereby. A partial
release pursuant to this Section 3.06 shall be permitted only if the CLTV for
the related Mortgage Loan after such partial release does not exceed the CLTV
for such Mortgage Loan as of the Cut-Off Date or related Subsequent Cut-Off
Date, as applicable. Any fee collected by the Servicer or the related
Subservicer for processing such request will be retained by the Servicer or
such Subservicer as additional servicing compensation.
(b) Notwithstanding any other provision of this Agreement to the contrary,
the Servicer, at its option and in its sole discretion, may modify any
Mortgage Loan to (i) change the Loan Rate payable on the related Mortgage
Loan, (ii) increase the credit limit on the related Mortgage Loan above the
limit stated in the related Loan Agreement, (iii) refinance the existing
senior Lien or place a new senior Lien related to a Mortgage Loan resulting
in a CLTV Ratio above the previous CLTV Ratio for such Mortgage Loan, or (iv)
make any other material modification to the related Mortgage Loan; provided,
however, that without the consent of the Enhancer, the aggregate Principal
Balance of the Mortgage Loans modified by this Section 3.06(b) shall not
exceed five percent (5%) of the Pool Balance as of the Cut-Off Date;
provided, further, that any decision by the Servicer to modify a Mortgage
Loan shall be normal and usual in accordance with its general mortgage
servicing activities and consistent with the procedures the Servicer employs
in servicing all other Mortgage Loans in the servicing portfolio with
characteristics similar to those of the Mortgage Loans (including, but not
limited to, analysis of credit scores, overall customer relationships and
comparable industry standards) and provided, further, that, any Mortgage Loan
modified in connection with a Promotional Advance will not be included in the
five percent (5%) limitation described herein.
13
Section 3.07 Trust Estate; Related Documents.
(a) When required by the provisions of this Agreement, the Issuer or the
Indenture Trustee shall execute instruments furnished to them by the Servicer
to release property from the terms of the Trust Agreement or Indenture, as
applicable, or convey the Issuer's or the Indenture Trustee's interest in the
same, in a manner and under circumstances that are not inconsistent with the
provisions of this Agreement. No party relying upon an instrument executed
by the Issuer or the Indenture Trustee as provided in this Section 3.07 shall
be bound to ascertain the Issuer's or the Indenture Trustee's authority,
inquire into the satisfaction of any conditions precedent or see to the
application of any moneys.
(b) Upon receipt of a Request for Release from the Servicer, substantially
in the form of Exhibit D hereto, to the effect that a Mortgage Loan has been
the subject of a final payment or a prepayment in full and such Mortgage Loan
has been terminated or that substantially all Net Liquidation Proceeds that
have been determined by the Servicer in its reasonable judgment to be finally
recoverable have been recovered, and upon deposit to the Custodial Account of
such final monthly payment, prepayment in full together with accrued and
unpaid interest to the date of such payment with respect to such Mortgage
Loan or, if applicable, Net Liquidation Proceeds, the Indenture Trustee shall
execute such Related Documents furnished to it, along with such documents as
the Servicer or the related Mortgagor may request to evidence satisfaction
and discharge of such Mortgage Loan, upon request of the Servicer.
Section 3.08 Realization upon Defaulted Mortgage Loans.
(a) The Servicer shall, consistent with the provisions of the Mortgage and
the Collection Policy, foreclose upon or otherwise comparably convert (which
may include acquisition of an REO Property) the ownership of any Mortgaged
Property securing a Mortgage Loan (but shall not sell or convey such Mortgage
Loan) in the event of a default under the Mortgage when no satisfactory
arrangements can be made for collection of delinquent payments pursuant to
Section 3.02, subject to the provisions contained in this Section 3.08(a) and
only if the Servicer determines that there is sufficient equity in the
related Mortgaged Property to justify such foreclosure. In connection with
such foreclosure or other conversion, the Servicer shall use reasonable
efforts to realize upon such defaulted Mortgage Loan in such manner as will
maximize the receipt of principal and interest thereon, taking into account,
among other things, the timing of foreclosure proceedings. The Servicer
shall pay all costs and expenses incurred by it in any such proceedings;
provided, however, that such costs and expenses shall be deemed to be a
"Servicing Advance" and the Servicer shall be reimbursed therefor as provided
in Section 3.04 hereof; provided, further, that, in any case in which the
Mortgaged Property shall have suffered damage such that the complete
restoration thereof is not fully reimbursable by insurance policies required
to be maintained with respect thereto, the Servicer shall not be required to
expend its own funds to restore such Mortgaged Property unless it shall
determine, in good faith, that such restoration will increase the Liquidation
Proceeds to the Trust after reimbursement to itself for such expenses. In
addition to the reimbursement of its costs and expenses, the Servicer shall
be entitled to a reasonable and customary fee as agreed to by the Servicer
and the Issuer for performing any foreclosure activities pursuant to this
Section 3.08(a), which fee shall be payable pursuant to Section 3.04.
14
(b) Any Liquidation Proceeds, Insurance Proceeds, REO Proceeds or
Condemnation Proceeds received in respect of a Mortgaged Property shall be
deposited in the Custodial Account pursuant to Section 3.03 and applied
pursuant to Section 3.04.
(c) In connection with such foreclosure or other conversion, the Servicer
shall exercise collection and foreclosure procedures in accordance with the
Collection Policy and with the same degree of care and skill in its exercise
or use as it would exercise or use under the circumstances in the conduct of
its own affairs. The Servicer shall take into account the existence of any
hazardous substances, hazardous wastes or solid wastes, as such terms are
defined in the Comprehensive Environmental Response Compensation and
Liability Act, the Resource Conservation and Recovery Act of 1976, or other
federal, state or local environmental legislation, on a Mortgaged Property in
determining whether to foreclose upon or otherwise comparably convert the
ownership of a Mortgaged Property. Any amounts advanced in connection with
such foreclosure or other action shall constitute "Servicing Advances."
Section 3.09 Management and Sale of REO Property. The Servicer shall
manage, conserve, protect and operate each REO Property solely for the
purpose of its prudent and prompt disposition and sale; provided, however,
that the Servicer shall complete such sale and disposition no later than, and
the Trust shall not retain ownership of any REO Property for longer than, 36
months after the date on which such REO Property is acquired by the Trust.
The Servicer shall, either itself or through an agent selected by the
Servicer, manage, conserve, protect and operate the REO Property in the same
manner that it manages, conserves, protects and operates other foreclosed
property for its own account, and in the same manner that similar property in
the same locality as the REO Property is managed. The Servicer shall attempt
to sell the same (and may temporarily rent the same) on such terms and
conditions as the Servicer deems to be in the best interest of the
Securityholders, the Enhancer and the Trust.
The Servicer shall cause to be set aside pursuant to Section 3.03, no
later than five Business Days after the receipt thereof, all revenues
received with respect to the conservation and disposition of the related REO
Property net of funds necessary for the proper operation, management and
maintenance of the REO Property and the fees of any managing agent acting on
behalf of the Servicer.
The disposition of REO Property shall be carried out by the Servicer
for cash at such price, and upon such terms and conditions, as the Servicer
deems to be in the best interest of the Securityholders, the Enhancer and the
Trust. The cash proceeds of sale of the REO Property shall be promptly set
aside pursuant to Section 3.03 as received from time to time and, as soon as
practicable thereafter, the expenses of such sale shall be paid. Any costs
or advances of the Servicer pursuant to this Section 3.09 also shall
constitute Servicing Advances. The Servicer shall reimburse itself for any
related unreimbursed Servicing Advances and unpaid Servicing Fees pursuant to
Section 3.04.
Section 3.10 Issuer and Indenture Trustee to Cooperate. Upon receipt of
payment in full, the Servicer is authorized to execute, pursuant to the
authorization contained in Section 3.01(c), an instrument of satisfaction
regarding the related Mortgage, which instrument of satisfaction shall be
recorded by the Servicer if required by applicable law and be delivered to
the Person entitled thereto. It is understood and agreed that any expenses
incurred in connection with such instrument of satisfaction or transfer shall
be reimbursed from amounts deposited in the Custodial Account as provided in
Section 3.04. From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan and in accordance with the provisions
hereof, upon request of the Servicer to the Issuer, of a Request for Release,
in the form attached hereto as Exhibit D, Issuer or Indenture Trustee shall
promptly execute such documents, in the forms provided by the Servicer, as
shall be necessary for the prosecution of any such proceedings or the taking
of other servicing actions.
15
In order to facilitate the foreclosure of the Mortgage securing any
Mortgage Loan that is in default following recordation of the related
Assignment of Mortgage to the Indenture Trustee or the Issuer if required in
accordance with the provisions of the Purchase Agreement or this Agreement,
the Indenture Trustee or the Issuer shall, if so requested in writing by the
Servicer, promptly execute an appropriate assignment in the form provided by
the Servicer to assign such Mortgage Loan for the purpose of collection to
the Servicer (any such assignment shall unambiguously indicate that the
assignment is for the purpose of collection only), and, upon such assignment,
the Servicer as assignee for collection will thereupon bring all required
actions in its own name and otherwise enforce the terms of such Mortgage Loan
and deposit or credit the Net Liquidation Proceeds, exclusive of Foreclosure
Profits, received with respect thereto into the Custodial Account. In the
event that all delinquent payments due under any such Mortgage Loan are paid
by the Mortgagor and any other defaults are cured, then the Servicer as
assignee for collection shall promptly reassign such Mortgage Loan to the
Indenture Trustee and return all Related Documents to the place where the
related Mortgage File was being maintained.
In connection with the Issuer's obligation to cooperate as provided in
this Section 3.10 and all other provisions of this Agreement requiring the
Issuer to authorize or permit any actions to be taken with respect to the
Mortgage Loans, the Indenture Trustee, as pledgee of the Mortgage Loans and
as assignee of record of the Mortgage Loans on behalf of the Issuer pursuant
to Section 3.13 of the Indenture, expressly agrees, on behalf of the Issuer,
to take all such actions on behalf of the Issuer and promptly to execute and
return all instruments reasonably required by the Servicer in connection
therewith; provided, however, that if the Servicer requests a signature of
the Indenture Trustee on behalf of the Issuer, then the Servicer shall
deliver to the Indenture Trustee an Officer's Certificate stating that such
signature is necessary or appropriate to enable the Servicer to carry out its
servicing and administrative duties under this Agreement.
Section 3.11 Compensation; Payment of Certain Expenses.
(a) As compensation for its services hereunder, the Servicer shall be
entitled to receive the Servicing Fee in accordance with Section 3.03(b) and
Section 3.04 as compensation for its services hereunder. Moreover, late
payment charges and the other amounts specified in Section 3.03(b) shall be
retained by the Servicer as additional servicing compensation.
(b) The Servicer shall be required to pay all expenses incurred by it in
connection with its servicing or administrative activities hereunder, and all
fees and expenses of the Owner Trustee, the Paying Agent, the Note Registrar,
the Certificate Paying Agent, the Certificate Registrar and the Indenture
Trustee, and shall not be entitled to reimbursement therefor except as
otherwise provided in this Agreement.
16
Section 3.12 Annual Statement as to Compliance.
(a) Within 90 days after December 31 of each year, commencing with 200_,
the Servicer shall deliver to the Issuer, the Indenture Trustee, the Paying
Agent, the Depositor and the Underwriter, with a copy to the Enhancer, a
servicer compliance certificate, signed by an authorized officer of the
Servicer, as described in Item 1123 of Regulation AB, to the effect that:
(i) A review of the Servicer's activities during the reporting
period and of its performance under this Agreement has been made under such
officer's supervision.
(ii) To the best of such officer's knowledge, based on such
review, the Servicer has fulfilled all of its obligations under this
Agreement in all materials respects throughout the reporting period or, if
there has been a failure to fulfill any such obligation in any material
respect, specifying each such failure known to such officer and the nature
and status thereof.
The Servicer shall use commercially reasonable efforts to obtain
from all other parties participating in the servicing function any additional
certifications required under Item 1123 of Regulation AB to the extent
required to be included in a Report on Form 10-K; provided, however, that a
failure to obtain such certifications shall not be a breach of the Servicer's
duties hereunder if any such party fails to deliver such a certification.
(b) The Servicer shall deliver to the Issuer and the Indenture Trustee,
with a copy to the Enhancer and the Paying Agent, promptly after having
obtained knowledge thereof, but in no event later than five Business Days
thereafter, written notice by means of an Officer's Certificate of any event
which with the giving of notice or the lapse of time or both, would become a
Servicing Default.
Section 3.13 Annual Independent Public Accountant's Servicing Report.
Within 90 days after December 31 of each year, beginning with 200_, the
Servicer at its expense shall cause a firm of independent public accountants,
which shall be members of the American Institute of Certified Public
Accountants, to furnish a report to the Depositor and the Indenture Trustee
the attestation required under Item 1122(b) of Regulation AB.
Section 3.14 Access to Certain Documentation and Information Regarding
the Mortgage Loans. Whenever required by statute or regulation, the Servicer
shall provide to the Enhancer, any Securityholder upon reasonable request (or
a regulator for a Securityholder) or the Indenture Trustee, reasonable access
to the documentation regarding the Mortgage Loans. Such access shall be
afforded without charge, but only upon reasonable request and during normal
business hours at the offices of the Servicer. Nothing in this Section 3.14
shall derogate from the obligation of the Servicer to observe any applicable
law prohibiting disclosure of information regarding Mortgagors, and the
failure of the Servicer to provide access as provided in this Section 3.14 as
a result of such obligation shall not constitute a breach of this
Section 3.14.
Section 3.15 Maintenance of Certain Servicing Insurance Policies. The
Servicer shall, during the term of its service as Servicer, maintain in force
and effect (i) a policy or policies of insurance covering errors and
omissions in the performance of its obligations as Servicer hereunder and
(ii) a fidelity bond in respect of its officers, employees or agents. Each
such policy or policies and fidelity bond shall be at least equal to the
coverage that would be required by Xxxxxx Xxx or Xxxxxxx Mac, whichever is
greater, for Persons performing servicing for mortgage loans purchased by
such entity. The Servicer shall furnish a copy of such policy or policies
and/or fidelity bond to the Enhancer upon the Enhancer's reasonable request
therefor.
17
Section 3.16 Information Required by the Internal Revenue Service and
Reports of Foreclosures and Abandonments of Mortgaged Property. The Servicer
shall prepare and deliver all federal and state information reports with
respect to the Mortgage Loans when and as required by all applicable state
and federal income tax laws. In particular, with respect to the requirement
under Section 6050J of the Code to the effect that the Servicer or
Subservicer shall make reports of foreclosures and abandonments of any
mortgaged property for each year beginning in 200_, the Servicer or
Subservicer shall file reports relating to each instance occurring during the
previous calendar year in which the Issuer (a) acquired an interest in any
Mortgaged Property through foreclosure or other comparable conversion in full
or partial satisfaction of a Mortgage Loan, or (b) knew or had reason to know
that any Mortgaged Property had been abandoned. The reports from the
Servicer or Subservicer shall be in form and substance sufficient to meet the
reporting requirements imposed by Section 6050J and Section 6050H (reports
relating to mortgage interest received) of the Code.
Section 3.17 Assignments; Recordings of Assignments.
(a) Concurrently herewith, the Depositor has contracted to acquire the
Mortgage Loans from the Seller and the Issuer has Granted its right, title
and interest in the Mortgage Loans and other Transferred Property
constituting the Trust Estate to the Indenture Trustee to secure payments on
the Notes. The Seller will deliver the original Loan Agreements to the
Servicer on behalf of the Depositor, endorsed or assigned in blank, to effect
the transfer to the Issuer of the Loan Agreements and all related Mortgages
and other loan documents. The parties hereto acknowledge and agree that the
Mortgage Loans shall for all purposes be deemed to have been transferred from
the Seller to the Depositor, from the Depositor to the Issuer and from the
Issuer to the Indenture Trustee.
(b) If the credit rating of Wachovia is withdrawn or reduced to "____" by
Standard & Poor's or "____" by Xxxxx'x, the Servicer shall, within 30 days of
any such withdrawal or reduction, at its own expense, prepare Assignments of
Mortgage (which may be included in one or more blanket assignments if
permitted by applicable law) in recordable form from the Seller to
"[____________], as Indenture Trustee under that certain Indenture dated as
of _____ __, 200_, for Wachovia Mortgage Loan Trust, LLC [______] Trust". In
addition, if the credit rating of Wachovia is withdrawn or reduced to below
"____" by Standard & Poor's or below "____" by Xxxxx'x, the Servicer shall,
within 60 days of any such withdrawal or reduction, at its own expense,
complete and submit for recording in the appropriate public office for real
property records the Assignments of Mortgage for each Mortgage Loan, provided
that no such recordation will be required in any state where, in the opinion
of counsel acceptable to the Enhancer, such recording is not required to
protect the Indenture Trustee's interests in the Mortgage Loan against the
claim of any subsequent transferee or any creditor of the Seller. While such
assignment to be recorded is being recorded, the Servicer shall retain a
photocopy of such assignment. If any assignment is lost or returned
unrecorded to the Servicer because of any defect therein, the Servicer shall
prepare a substitute assignment or cure such defect, as the case may be, and
the Servicer shall cause such assignment to be recorded in accordance with
this paragraph. Any Assignment of Mortgage required to be recorded hereunder
shall be retained in the Mortgage File.
18
Section 3.18 [Reserved].
Section 3.19 Funding Account and Distribution Account.
(a) No later than the Closing Date, the Indenture Trustee shall establish
and maintain on behalf of the Enhancer and the Noteholders one or more
segregated trust accounts, which shall be Eligible Accounts, titled "Funding
Account, [_________________], as Indenture Trustee for Wachovia Mortgage Loan
Trust, LLC [______] Trust" (the "Funding Account"). On the Business Day
prior to each Payment Date during the Revolving Period, the Servicer shall
withdraw from the Custodial Account and deposit (x) into the Funding Account
(i) the aggregate amount of Principal Collections remaining after the
purchase of all Additional Balances and Subsequent Mortgage Loans, and (ii)
on and after the Payment Date occurring in [_____] 200_, from Excess Spread
the amount necessary to be applied so that the Overcollateralization Amount
is not less than the Overcollateralization Target Amount, and (y) into the
Distribution Account established by the Certificate Paying Agent, the
Additional Balance Increase Amount, in each case to the extent available and
subject to the provisions of Section 3.05(a) of the Indenture.
(b) On each Subsequent Transfer Date, the Servicer shall instruct the
Indenture Trustee in writing to withdraw from the Funding Account an amount
equal to the aggregate Principal Balance as of the related Subsequent Cut-Off
Date of the Subsequent Mortgage Loans to be sold to the Trust on such
Subsequent Transfer Date and allocate such withdrawal to amounts on deposit
in the Funding Account, and to pay such amount to or upon the order of the
Seller upon satisfaction of the conditions set forth in this Agreement, in
the Purchase Agreement and in the related Subsequent Transfer Agreement with
respect thereto.
(c) The Servicer may cause the institution maintaining the Funding Account
to invest any funds therein in Permitted Investments having a maturity of up
to 90 days or maturing or otherwise available not later than the Business Day
preceding the related Payment Date on which funds are scheduled to be
withdrawn to purchase Subsequent Mortgage Loans or Additional Balances,
provided that no such investment may be sold or disposed of prior to
maturity. If no instructions are received as to which Permitted Investments
the funds are to be invested in, the funds shall be invested in Permitted
Investments described in clause (v) of such definition. In addition, no such
Permitted Investment shall be purchased at a price in excess of par. At any
time when the Indenture Trustee is maintaining the Funding Account, any
request by the Servicer to invest funds on deposit therein shall be in
writing, delivered to the Indenture Trustee at or before 10:30 a.m., New York
time, if such investment is to be made on such day. The Servicer shall
certify that the requested investment is a Permitted Investment maturing at
or prior to the time required hereby. Any such investment shall be
registered in the name of the Indenture Trustee or its nominee, and to the
extent that any such investment is certificated, such investment shall be
maintained with the Indenture Trustee at its Corporate Trust Office. All net
income or other gain received from any such investment shall be deposited
into or credited to the Custodial Account as Interest Collections, and may be
withdrawn therefrom in accordance with Section 3.05 of the Indenture.
(d) From time to time the Indenture Trustee shall make withdrawals from the
Funding Account in accordance with written instructions from the Servicer as
follows:
19
(i) on each Payment Date during the Revolving Period, any amounts on
deposit in the Funding Account, including Excess Spread, shall be withdrawn
and applied, to the extent available to the Seller, as designee of the
Depositor, as payment for Additional Balances, if any, in an amount equal to
(A) the aggregate of all Draws during the related Collection Period or (B) if
the Servicer has applied amounts on deposit in the Custodial Account
representing Principal Collections received during such Collection Period to
the purchase of Additional Balances, the excess, if any, of the aggregate of
all Draws during the related Collection Period over the amount on deposit in
the Funding Account;
(ii) on each Subsequent Transfer Date, any amounts on deposit in the Funding
Account, to the extent not used to purchase Additional Balances, shall be
withdrawn and applied as payment for Subsequent Mortgage Loans, if any, in an
amount equal to the aggregate Principal Balance as of the related Subsequent
Cut-Off Date of the Subsequent Mortgage Loans;
(iii) prior to 3:00 p.m. (EST) on the Business Day prior to the Payment Date
immediately following the last day of the Revolving Period, any amounts
remaining on deposit in the Funding Account, if any, after giving effect to
clauses (i) and (ii) above, shall be first deposited into the Distribution
Account in an amount equal to the lesser of (A) the Additional Balance
Increase Amount and (B) the amount on deposit in the Funding Account, and
then shall be deposited to the Note Payment Account for payment to the
Noteholders pursuant to Section 3.05 of the Indenture.
Section 3.20 [Reserved].
Section 3.21 P&I Advances.
(a) The Servicer, in its sole discretion, may deposit into the Custodial
Account (from its own funds) an amount equal to the aggregate amount of
principal of or interest on Mortgage Loans that were delinquent as of the end
of any Collection Period ("P&I Advances"). The Servicer shall notify the
Indenture Trustee and the Paying Agent by a certificate of the Servicing
Officer of (i) the aggregate amount of P&I Advances for a Payment Date and
(ii) the amount of any Nonrecoverable P&I Advances for such Payment Date.
(b) Notwithstanding anything herein to the contrary, no P&I Advance shall
be required to be made hereunder or shall be made hereunder if such P&I
Advance would, if made, constitute a Nonrecoverable P&I Advance. On the
fourth Business Day before each Payment Date, the Servicer shall determine
whether each P&I Advance made with respect to any previous Payment Date is a
Nonrecoverable P&I Advance.
Section 3.22 Transfer of Mortgage Loans.
(a) Subject to the conditions set forth below, the Servicer, upon receipt
of written notice and direction from the Issuer, shall cause the retransfer
of Mortgage Loans from the Trust Estate to the Issuer as of the close of
business on a Payment Date (the "Transfer Date"). On the fifth Business Day
(the "Transfer Notice Date") prior to the Transfer Date designated in such
notice, the Servicer shall give the Indenture Trustee, the Rating Agencies,
the Paying Agent and the Enhancer a notice of the proposed retransfer that
contains a list of the Mortgage Loans to be retransferred. Such retransfers
of Mortgage Loans shall be permitted upon satisfaction of the following
conditions:
(i) No Rapid Amortization Event has occurred;
20
(ii) On the Transfer Date, the Overcollateralization Amount (after giving
effect to the removal from the Trust Estate of the Mortgage Loans proposed to
be retransferred) will equal or exceed the Overcollateralization Target
Amount;
(iii) The retransfer of any Mortgage Loans on any Transfer Date during the
Managed Amortization Period shall not, in the reasonable belief of the
Servicer, cause a Rapid Amortization Event to occur or an event which with
notice or lapse of time or both would constitute a Rapid Amortization Event;
(iv) On or before the Transfer Date, the Servicer shall have delivered to
the Indenture Trustee and the Paying Agent a revised Mortgage Loan Schedule
showing that the Mortgages Loans transferred to the Certificateholders are no
longer owned by the Trust Estate;
(v) The Servicer shall represent and warrant that the Mortgage Loans to be
removed from the Trust Estate were selected at random and the Servicer shall
have received the consent of the Enhancer as to the selection of the
particular Mortgage Loans to be removed; and
(vi) The Enhancer shall have consented to the Transfer;
(vii) Notice of such removal has been given to the Rating Agencies;
(viii)......Such transfer may only occur once per month;
(ix) The Outstanding Principal Balance of the Transferred Mortgage Loans
shall not be greater than the Outstanding Additional Balance Increase Amount
immediately prior to such transfer; and
(x) The Servicer shall have delivered to the Indenture Trustee, the Paying
Agent and the Enhancer an Officer's Certificate certifying that the items set
forth in subparagraphs (i) through (ix), inclusive, have been performed or
are true and correct, as the case may be. The Indenture Trustee and the
Paying Agent may conclusively rely on such Officer's Certificate, shall have
no duty to make inquiries with regard to the matters set forth therein and
shall incur no liability in so relying.
The Servicer shall not be permitted to effect the retransfer of any
Mortgage Loan except under the conditions specified above. Upon receiving
the requisite notice and direction from the Issuer, the Servicer shall
perform in a timely manner those acts required of it, as specified above.
Upon satisfaction of the above conditions, on the Transfer Date the Servicer
shall deliver, or cause to be delivered, to the Issuer a written itemization
of each Mortgage Loan being transferred, together with the Mortgage File for
each such Mortgage Loan, and the Indenture Trustee shall execute and deliver
to the Issuer or its designee such other documents prepared by the Servicer
as shall be reasonably necessary to transfer such Mortgage Loans to the
Certificateholders. Any such transfer of the Trust Estate's right, title and
interest in and to Mortgage Loans shall be without recourse, representation
or warranty by or of the Indenture Trustee or the Trust Estate to the Issuer
or its designee.
21
ARTICLE IV
Servicing Certificate
Section 4.01 Statements to Securityholders.
(a) With respect to each Payment Date, on the Business Day following the
related Determination Date, the Servicer shall forward the Servicing
Certificate to the Indenture Trustee and the Paying Agent, and the Paying
Agent, pursuant to Section 3.26 of the Indenture, shall on such Payment Date
make such Servicing Certificate available to each Certificateholder, each
Noteholder, the Depositor, the Owner Trustee, the Certificate Paying Agent,
the Paying Agent and each Rating Agency, with a copy to the Enhancer. The
Servicing Certificate shall set forth the following information as to the
Notes and Certificates, to the extent applicable:
(i) the applicable Record Date, Determination Date and Payment Date;
(ii) the aggregate amount of payments received with respect to the Mortgage
Loans, including prepayment amounts;
(iii) the Servicing Fee and Subservicing Fee payable to the Servicer and the
Subservicer;
(iv) the amount of any other fees or expenses paid, and the identity of the
party receiving such fees or expenses;
(v) the aggregate amount of (a) Interest Collections, (b) Principal
Collections (and, with respect to any Payment Date relating to the Managed
Amortization Period, Net Principal Collections) and (c) Substitution
Adjustment Amounts for such Collection Period;
(vi) the amount of such distribution as principal to the Noteholders;
(vii) the amount of such distribution as interest to the Noteholders, the
amount thereof, if any, payable in respect of unpaid Interest Shortfalls, and
the amount of any Interest Shortfalls for the related Payment Date;
(viii) each Deficiency Amount, if any, for such Payment Date and the
aggregate amount of prior draws on the Policy thereunder not yet reimbursed;
(ix) the amount, if any, received under the Yield Maintenance Agreement;
(x) the amount of such distribution to the Certificateholders;
(xi) the amount of any Additional Balance Increase Amount payable to the
Certificateholders and the amount of Principal Collections paid in respect of
such Additional Balance Increase Amount;
(xii) the aggregate Principal Balance of the Mortgage Loans as of the end of
the preceding Collection Period;
22
(xiii) the number and aggregate Principal Balances of Mortgage Loans (a)
as to which the Minimum Monthly Payment is delinquent for 30-59 days, 60-89
days, 90-119 days, 120-149 days, 150-179 days and 180 or more days,
respectively, (b) the related Mortgaged Property of which has been foreclosed
upon and (c) as to which the related Mortgaged Property has become REO
Property, in each case as of the end of the preceding Collection Period;
provided, however, that such information shall not be provided on the
statements relating to the first Payment Date;
(xiv) LIBOR for the related Interest Period;
(xv) the Note Rate for the Notes for such Payment Date;
(xvi) the Net WAC Rate for the related Collection Period;
(xvii) prior to the second Determination Date following the commencement
of the Rapid Amortization Period, the aggregate amount of Additional Balances
created during the previous Collection Period and conveyed to the Issuer
prior to the commencement of the Rapid Amortization Period;
(xviii) the aggregate Liquidation Loss Amounts (other than amounts
allocated in respect of the Excluded Amount) with respect to the related
Collection Period, the amount distributed as principal to Noteholders in
respect of Liquidation Loss Amounts and the aggregate of the Liquidation Loss
Amounts (minus any Subsequent Recovery Amounts and other than amounts
allocated in respect of the Excluded Amount) from all Collection Periods to
date expressed as dollar amount and as a percentage of the aggregate Cut-Off
Date Principal Balances of the Mortgage Loans;
(xix) the Note Balance of the Notes and the Certificate Balance of the
Certificates after giving effect to the distribution of principal on such
Payment Date;
(xx) the balance of the Funding Account as of the end of the preceding
Collection Period;
(xxi) the Percentage Interest applicable to each of the Securities, after
application of payments made on such Payment Date;
(xxii) the Overcollateralization Amount as of the end of the preceding
Collection Period;
(xxiii) the aggregate Principal Balance of Subsequent Mortgage Loans
transferred to the Trust Estate since the Closing Date;
(xxiv) reserved;
(xxv) reserved;
(xxvi) on or after the Stepdown Date, a statement (yes or no) as to
whether each of the Stepdown Delinquency Test and the Stepdown Cumulative
Loss Test have been met as of the related Payment Date;
23
(xxvii) the aggregate outstanding Principal Balance of the three largest
Mortgage Loans as of the close of business on the last day of the related
Collection Period;
(xxviii) the Overcollateralization Target Amount;
(xxix) the number of Mortgage Loans that are the subject of a
Promotional Rate and the aggregate amount of Promotional Advances with
respect to such Mortgage Loan;
(xxx) any material modifications, extensions or waivers to the terms of the
Mortgage Loans during the Collection Period or that have cumulatively become
material over time; and
(xxxi) any material breaches of Mortgage Loan representations,
warranties or covenants in the Purchase Agreement.
In the case of information furnished pursuant to clauses (ii) and (iii)
above, the amounts shall be expressed as an aggregate dollar amount per Note
or Certificate, as applicable, with a $______ denomination and per
Certificate with a denomination equal to a 100% Percentage Interest.
If a Managed Amortization Event, a Rapid Amortization Event or a
Servicing Default shall occur, on the Business Day following the related
Determination Date, the Servicer shall forward to the Indenture Trustee and
the Paying Agent, a statement to such effect, including the nature of such
Rapid Amortization Event or Servicing Default. The Paying Agent shall
deliver or cause to be delivered by mail to each Certificateholder, each
Noteholder, the Enhancer, the Depositor, the Owner Trustee, the Certificate
Paying Agent and each Rating Agency, notice of such Managed Amortization
Event, Rapid Amortization Event or Servicing Default, including, in the case
of a Rapid Amortization Event or a Servicing Default, the nature thereof.
Such statement may be included in, or separate from, the regular statement
sent to Securityholders.
The Paying Agent shall make the Servicing Certificate (and, at its
option, any additional files containing the same information in an
alternative format) available each month to Securityholders and the Enhancer,
and other parties to this Agreement via the Paying Agent's internet website.
The Paying Agent's internet website shall initially be located at
"xxx.xxxxxxxxxxxx.xxx". Assistance in using the website can be obtained by
calling the Paying Agent's customer service desk at (000) 000-0000. Parties
that are unable to use the above distribution option are entitled to have a
paper copy mailed to them via first class mail by calling the customer
service desk and indicating such. The Paying Agent shall have the right to
change the way the statements to Securityholders are distributed in order to
make such distribution more convenient and/or more accessible to the above
parties and the Paying Agent shall provide timely and adequate notification
to all above parties regarding any such changes. The Paying Agent may require
registration and the acceptance of a disclaimer in connection with access to
its website
(b) The Servicer shall forward to the Paying Agent any other information
reasonably requested by the Paying Agent necessary to make distributions
pursuant to Section 3.05 of the Indenture. Prior to the close of business on
the Business Day next succeeding each Determination Date, the Servicer shall
furnish a written statement to the Certificate Paying Agent, the Paying Agent
and the Indenture Trustee setting forth the aggregate amounts required to be
withdrawn from the Custodial Account and deposited into the Note Payment
Account, Funding Account and/or Distribution Account on the Business Day
preceding the related Payment Date pursuant to Section 3.04. The
determination by the Servicer of such amounts shall, in the absence of
obvious error, be deemed to be presumptively correct for all purposes
hereunder, and the Owner Trustee, the Paying Agent and the Indenture Trustee
shall be protected in relying upon the same without any independent check or
verification. In addition, upon the Issuer's written request, the Servicer
shall promptly furnish such information reasonably requested by the Issuer
that is reasonably available to the Servicer to enable the Issuer to perform
its federal and state income tax reporting obligations.
24
Section 4.02 Tax Returns and 1934 Act Reports
(a) The Servicer agrees to perform the obligations of the Servicer set
forth in Section 5.03 of the Trust Agreement. The Servicer will prepare and
file or cause to be prepared and filed all tax and information returns of the
Trust Estate.
(b) The Servicer shall prepare all reports on behalf of the Trust Estate,
including, but not limited to, all Forms 8-K and Forms 10-K, and, when
applicable, any Form 15, that are required under the Securities Exchange Act
of 1934, as amended, and any certifications required by the Xxxxxxxx-Xxxxx
Act of 2002 to be filed with such Forms 10-K. The Servicer shall continue to
file all Forms 8-K and Forms 10-K with respect to the Trust Estate until
directed by the Depositor in writing to discontinue such filings.
Section 4.03 Exchange Act Reporting
(a) The Servicer shall, on behalf of the Depositor and in respect of the
Trust Estate, sign and cause to be filed with the Commission any periodic
reports required to be filed under the provisions of the Exchange Act, and
the rules and regulations of the Commission thereunder including, without
limitation, reports on Form 10-K, Form 10-D and Form 8-K. In connection with
the preparation and filing of such periodic reports, the Indenture Trustee
shall timely provide to the Servicer (I) a list of Securityholders as shown
on the Certificate Register and the Note Register as of the end of each
calendar year, (II) copies of all pleadings, other legal process and any
other documents relating to any claims, charges or complaints involving the
Indenture Trustee, as trustee hereunder, or the Trust Estate that are
received by the Indenture Trustee, (III) notice of all matters that, to the
actual knowledge of a Responsible Officer of the Indenture Trustee, have been
submitted to a vote of the Securityholders, other than those matters that
have been submitted to a vote of the Securityholders at the request of the
Depositor or the Servicer, and (IV) notice of any failure of the Indenture
Trustee to make any distribution to the Securityholders as required pursuant
to this Agreement. Neither the Servicer nor the Indenture Trustee shall have
any liability with respect to the Servicer's failure to properly prepare or
file such periodic reports resulting from or relating to the Servicer's
inability or failure to obtain any information not resulting from the
Servicer's own negligence or willful misconduct.
(b) Any Form 10-K filed with the Commission in connection with this Section
4.03 shall include:
(i) A certification, signed by the senior officer in charge of the
servicing functions of the Servicer, in the form attached
as Exhibit E hereto or such other form as may be required
or permitted by the Commission (the "Form 10-K
Certification"), in compliance with Rules 13a-14 and 15d-14
under the Exchange Act and any additional directives of the
Commission.
25
(ii) A report regarding its assessment of compliance during the preceding
calendar year with all applicable servicing criteria set
forth in relevant Commission regulations with respect to
mortgage-backed securities transactions taken as a whole
involving the Servicer that are backed by the same types of
assets as those backing the certificates, as well as
similar reports on assessment of compliance received from
other parties participating in the servicing function as
required by relevant Commission regulations, as described
in Item 1122(a) of Regulation AB. The Servicer shall
obtain from all other parties participating in the
servicing function any required certifications.
(iii) With respect to each assessment report described immediately above, a
report by a registered public accounting firm that attests
to, and reports on, the assessment made by the asserting
party, as set forth in relevant Commission regulations, as
described in Regulation 1122(b) of Regulation AB and
Section 3.13.
(iv) The servicer compliance certificate required to be delivered pursuant
Section 3.12.
(c) In connection with the Form 10-K Certification, the Indenture Trustee
shall provide the Servicer with a back-up certification substantially in the
form attached hereto as Exhibit F.
(d) This Section 4.03 may be amended in accordance with this Agreement
without the consent of the Securityholders.
ARTICLE V
Note Payment Account
Section 5.01 Note Payment Account. The Paying Agent shall establish and
maintain an Eligible Account entitled "Wachovia Bank, National Association,
as Paying Agent, for the benefit of the Securityholders, the Indenture
Trustee, the Certificate Paying Agent and the Enhancer, pursuant to the
Indenture, dated as of _____ __, 200_, among Wachovia Mortgage Loan Trust,
LLC [______] Trust, Wachovia Bank, National Association and
[_________________]" (the "Note Payment Account"). On each Payment Date,
amounts on deposit in the Note Payment Account shall be distributed by the
Paying Agent in accordance with Section 3.05 of the Indenture. The Paying
Agent shall invest or cause the institution maintaining the Note Payment
Account to invest the funds therein in Permitted Investments designated in
the name of the Paying Agent, which investments shall mature not later than
the Business Day next preceding the Payment Date next following the date of
such investment (except that any investment in the institution with which the
Note Payment Account is maintained may mature or be payable on demand on such
Payment Date). In addition, no such Permitted Investment shall be purchased
at a price in excess of par. All income and gain realized from any such
investment shall be for the benefit of the Servicer and shall be subject to
its withdrawal or order from time to time, except that an amount equal to one
day's interest on any such investment shall be for the benefit of the Paying
Agent. The amount of any losses incurred in respect of any such investments
shall be deposited in the Note Payment Account by the Servicer and the Paying
Agent out of their own funds immediately as realized and shall be allocated
between the Servicer and the Paying Agent on a pro rata basis, such that the
percentage of any such loss allocated to the Paying Agent shall equal a
fraction, the numerator of which equals one (1) and the denominator of which
equals the number of days the funds in the Note Payment Account were invested
in such investment. Subject to Section 8.02(b) of the Indenture, and except
as provided in this Section 5.01, the Paying Agent shall not be liable for
investment losses on funds on deposit in the Note Payment Account.
26
ARTICLE VI
The Servicer
Section 6.01 Liability of the Servicer. The Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically
imposed upon and undertaken by the Servicer herein.
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer. Any corporation into which the Servicer may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Servicer
shall be a party, or any corporation succeeding to the business of the
Servicer, shall be the successor of the Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.
The Servicer may assign its rights and delegate its duties and
obligations under this Agreement, provided that the Person accepting such
assignment or delegation shall be a Person qualified to service mortgage
loans, is reasonably satisfactory to the Enhancer (provided, however, that
such consent to assignment may not be unreasonably withheld), is willing to
service the Mortgage Loans and executes and delivers to the Issuer (with a
copy to the Enhancer) an agreement, in form and substance reasonably
satisfactory to the Enhancer, that contains an assumption by such Person of
the due and punctual performance and observance of each covenant and
condition to be performed or observed by the Servicer under this Agreement;
provided, further, that no Rating Event will occur as a result of such
assignment and delegation (as evidenced by a letter to such effect from each
Rating Agency) if determined without regard to the Policy; provided, further,
that the Owner Trustee, the Paying Agent, the Enhancer and the Indenture
Trustee shall receive an Opinion of Counsel to the effect that such
assignment or delegation will not cause the Issuer to be treated as an
association (or a publicly-traded partnership) taxable as a corporation for
federal income tax purposes.
Section 6.03 Limitation on Liability of the Servicer and Others.
Neither the Servicer nor any of the directors or officers or employees or
agents of the Servicer shall be under any liability to the Issuer, the Owner
Trustee, the Paying Agent, the Indenture Trustee or the Securityholders for
any action taken or for refraining from the taking of any action in good
faith pursuant to this Agreement; provided, however, that this provision
shall not protect the Servicer or any such Person against any liability that
would otherwise be imposed by reason of its willful misfeasance, bad faith or
gross negligence in the performance of its duties hereunder or by reason of
its reckless disregard of its obligations and duties hereunder. The Servicer
and any director or officer or employee or agent of the Servicer may rely in
good faith on any document of any kind prima facie properly executed and
submitted by any Person respecting any matters arising hereunder. The
Servicer and any director, officer, employee or agent of the Servicer shall
be indemnified by the Issuer and held harmless against any loss, liability or
expense incurred in connection with any legal action relating to this
Agreement or the Securities, including any amount paid to the Owner Trustee,
the Paying Agent or the Indenture Trustee pursuant to Section 6.06(b), other
than any loss, liability or expense related to any specific Mortgage Loan or
Mortgage Loans (except as any such loss, liability or expense shall be
otherwise reimbursable pursuant to this Agreement) and any loss, liability or
expense incurred by reason of the Servicer's willful misfeasance, bad faith
or gross negligence in the performance of its duties hereunder or by reason
of its reckless disregard of its obligations and duties hereunder. The
Servicer shall not be under any obligation to appear in, prosecute or defend
any legal action that is not incidental to its duties to service the Mortgage
Loans in accordance with this Agreement, and that in its opinion may involve
it in any expense or liability; provided, however, that the Servicer may in
its sole discretion undertake any such action that it may deem necessary or
desirable in respect of this Agreement, the rights and duties of the parties
hereto and the interests of the Securityholders and the Enhancer. In such
event, the reasonable legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Issuer, and the Servicer shall be entitled to be reimbursed therefor. The
Servicer's right to indemnity or reimbursement pursuant to this Section 6.03
shall survive any resignation or termination of the Servicer pursuant to
Section 6.04 or 7.01 with respect to any losses, expenses, costs or
liabilities arising prior to such resignation or termination (or arising from
events that occurred prior to such resignation or termination).
27
Section 6.04 Servicer Not to Resign. Subject to the provisions of
Section 6.02, the Servicer shall not resign from the obligations and duties
hereby imposed on it except (a) upon determination that the performance of
its obligations or duties hereunder are no longer permissible under
applicable law or are in material conflict by reason of applicable law with
any other activities carried on by it or its subsidiaries or Affiliates, the
other activities of the Servicer so causing such a conflict being of a type
and nature carried on by the Servicer or its subsidiaries or Affiliates at
the date of this Agreement or (b) upon satisfaction of the following
conditions: (i) the Servicer shall have proposed a successor servicer to the
Issuer and the Indenture Trustee in writing and such proposed successor
servicer is reasonably acceptable to the Issuer, the Indenture Trustee and
the Enhancer; (ii) each Rating Agency shall have delivered a letter to the
Issuer, the Enhancer and the Indenture Trustee prior to the appointment of
the successor servicer stating that the proposed appointment of such
successor servicer as Servicer hereunder will not cause a Rating Event, if
determined without regard to the Policy; and (iii) such proposed successor
servicer is reasonably acceptable to the Enhancer, as evidenced by a letter
to the Issuer and the Indenture Trustee; provided, however, that no such
resignation by the Servicer shall become effective until such successor
servicer or, in the case of (a) above, the Indenture Trustee, as pledgee of
the Mortgage Loans, shall have assumed the Servicer's responsibilities and
obligations hereunder or the Indenture Trustee, as pledgee of the Mortgage
Loans, shall have designated a successor servicer in accordance with
Section 7.02. Any such resignation shall not relieve the Servicer of
responsibility for any of the obligations specified in Sections 7.01 and 7.02
as obligations that survive the resignation or termination of the Servicer.
Any such determination permitting the resignation of the Servicer shall be
evidenced by an Opinion of Counsel to such effect delivered to the Indenture
Trustee and the Enhancer.
28
Section 6.05 Delegation of Duties. In the ordinary course of business,
the Servicer at any time may delegate any of its duties hereunder to any
Person, including any of its Affiliates, that agrees to conduct such duties
in accordance with standards comparable to those with which the Servicer
complies pursuant to Section 3.01. Such delegation shall not relieve the
Servicer of its liabilities and responsibilities with respect to such duties
and shall not constitute a resignation within the meaning of Section 6.04.
Section 6.06 Payment of Indenture Trustee's, the Paying Agent's and
Owner Trustee's Fees and Expenses; Indemnification.
(a) After the Closing Date, the Servicer covenants and agrees to pay to the
Owner Trustee, the Paying Agent, the Note Registrar, the Certificate Paying
Agent, the Certificate Registrar, the Indenture Trustee and any co-trustee of
the Indenture Trustee or the Owner Trustee from time to time, and the Owner
Trustee, the Note Registrar, the Certificate Paying Agent, the Certificate
Registrar, the Paying Agent, the Indenture Trustee and any such co-trustee
shall be entitled to, reasonable compensation for all services rendered by
each of them in the execution of the trusts created under the Trust Agreement
and the Indenture and in the exercise and performance of any of the powers
and duties under the Trust Agreement or the Indenture, as the case may be, of
the Owner Trustee, the Note Registrar, the Certificate Paying Agent, the
Certificate Registrar, the Paying Agent, the Indenture Trustee and any
co-trustee, and the Servicer will pay or reimburse the Note Registrar, the
Certificate Paying Agent, the Certificate Registrar, the Paying Agent, the
Indenture Trustee and any co-trustee upon request for all reasonable
expenses, disbursements and advances incurred or made by the Note Registrar,
the Certificate Paying Agent, the Certificate Registrar, the Paying Agent,
the Indenture Trustee or any co-trustee in accordance with any of the
provisions of this Agreement, the Indenture, the Trust Agreement, or any
other Basic Document (which payment shall not be limited by any law in
regards to the compensation of a trustee of an express trust) except any such
expense, disbursement or advance as may arise from its negligence, willful
misfeasance or bad faith. In addition, the Indenture Trustee shall be
entitled to be reimbursed from the Servicer for all reasonable costs
associated with the transfer of servicing from the predecessor servicer
pursuant to Section 7.02 hereunder, including, without limitation, any
reasonable costs or expenses associated with the complete transfer of all
servicing data and the completion, correction or manipulation of such
servicing data as may be required by the Indenture Trustee to correct any
errors or insufficiencies in the servicing data or otherwise to enable the
Indenture Trustee or successor Servicer to service the Mortgage Loans
properly and effectively.
(b) The Servicer agrees to indemnify the Indenture Trustee, the Paying
Agent, the Note Registrar, the Certificate Paying Agent, the Certificate
Registrar and the Owner Trustee for, and to hold the Indenture Trustee (and
any Responsible Officer thereof), the Paying Agent, the Note Registrar, the
Certificate Paying Agent, the Certificate Registrar and the Owner Trustee, as
the case may be, harmless against, any loss, liability or expense incurred
without negligence, bad faith or willful misconduct on the part of the
Indenture Trustee, the Paying Agent, the Note Registrar, the Certificate
Paying Agent, the Certificate Registrar or the Owner Trustee, as the case may
be, arising out of, or in connection with, the acceptance and administration
of the Issuer and the assets thereof, including the costs and expenses
(including reasonable legal fees and expenses) of defending the Indenture
Trustee, the Paying Agent, the Note Registrar, the Certificate Paying Agent,
the Certificate Registrar or the Owner Trustee, as the case may be, against
any claim in connection with the exercise or performance of any of its powers
or duties under any Basic Document; provided, however, that:
29
(i) with respect to any such claim, the Indenture Trustee, the Paying
Agent, the Note Registrar, the Certificate Paying Agent, the Certificate
Registrar or Owner Trustee, as the case may be, shall have given the Servicer
written notice thereof promptly after the Indenture Trustee, the Paying
Agent, the Note Registrar, the Certificate Paying Agent, the Certificate
Registrar or Owner Trustee, as the case may be, shall have actual knowledge
thereof;
(ii) while maintaining control over its own defense, the Issuer, the
Indenture Trustee, the Paying Agent, the Note Registrar, the Certificate
Paying Agent, the Certificate Registrar or Owner Trustee, as the case may be,
shall cooperate and consult fully with the Servicer in preparing such
defense; and
(iii) notwithstanding anything in this Agreement to the contrary, the
Servicer shall not be liable for settlement of any claim by the Indenture
Trustee, the Paying Agent, the Note Registrar, the Certificate Paying Agent,
the Certificate Registrar or the Owner Trustee, as the case may be, entered
into without the prior consent of the Servicer.
No termination of this Agreement or resignation or removal of the
Paying Agent, the Note Registrar, the Certificate Paying Agent, the
Certificate Registrar or the Indenture Trustee shall affect the obligations
created by this Section 6.06 of the Servicer to indemnify the Indenture
Trustee, the Paying Agent, the Note Registrar, the Certificate Paying Agent,
the Certificate Registrar and the Owner Trustee under the conditions and to
the extent set forth herein.
Notwithstanding the foregoing, the indemnification provided by the
Servicer in this Section 6.06(b) shall not pertain to any loss, liability or
expense of the Indenture Trustee, the Paying Agent, the Note Registrar, the
Certificate Paying Agent, the Certificate Registrar or the Owner Trustee,
including the costs and expenses of defending itself against any claim,
incurred in connection with any actions taken by the Indenture Trustee, the
Paying Agent, the Note Registrar, the Certificate Paying Agent, the
Certificate Registrar or the Owner Trustee at the written direction of the
Noteholders or Certificateholders, as the case may be, pursuant to the terms
of this Agreement.
ARTICLE VII
Default
Section 7.01 Servicing Default.
(a) If a Servicing Default shall occur and be continuing, then, and in
every such case, so long as a Servicing Default shall not have been remedied
by the Servicer, either the Depositor, the Enhancer (so long as no Enhancer
Default exists), or the Indenture Trustee, at the written direction of the
holders of at least 51% of the Outstanding Note Balance (if an Enhancer
Default exists) by notice then given in writing to the Servicer, the Issuer
and the Indenture Trustee, may terminate all of the rights and obligations of
the Servicer as servicer under this Agreement other than its right to receive
servicing compensation and reimbursement for servicing the Mortgage Loans
hereunder during any period prior to the date of such termination, and the
Issuer, the Enhancer or the Indenture Trustee (with the written consent of
the Enhancer), may exercise any and all other remedies available at law or
equity. The Servicer shall immediately notify the Indenture Trustee, the
Issuer and each Rating Agency, the Enhancer and the Issuer in writing of any
Servicing Default as to which it has actual knowledge. On or after the
receipt by the Servicer of such written notice, all authority and power of
the Servicer under this Agreement, whether with respect to the Securities or
the Mortgage Loans or otherwise, shall pass to and be vested, subject to
Section 7.02 hereof, as pledgee of the Mortgage Loans, in the Indenture
Trustee, pursuant to and under this Section 7.01; and, without limitation,
the Indenture Trustee is hereby authorized and empowered to execute and
deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and
all documents and other instruments, and to do or accomplish all other acts
or things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement of each
Mortgage Loan and related documents, or otherwise. The Servicer agrees to
cooperate with the Issuer, the Enhancer and Indenture Trustee, as the case
may be, in effecting the termination of the responsibilities and rights of
the Servicer hereunder, including, without limitation, the transfer to the
Indenture Trustee for the administration by it of all cash amounts relating
to the Mortgage Loans that shall at the time be held by the Servicer and to
be deposited by it in the Custodial Account, or that have been deposited by
the Servicer in the Custodial Account or thereafter received by the Servicer
with respect to the Mortgage Loans. All reasonable costs and expenses
(including, but not limited to, attorneys' fees) incurred in connection with
amending this Agreement to reflect such succession as Servicer pursuant to
this Section 7.01 shall be paid by the predecessor Servicer (or if the
predecessor Servicer is the Indenture Trustee, the initial Servicer) upon
presentation of reasonable documentation of such costs and expenses.
30
(b) Notwithstanding any termination of the activities of the Servicer
hereunder, the Servicer shall be entitled to receive, out of any late
collection of a payment on a Mortgage Loan that was due prior to the notice
terminating the Servicer's rights and obligations hereunder and received
after such notice, that portion to which the Servicer would have been
entitled pursuant to Sections 3.03 and 3.09, as well as its Servicing Fee in
respect thereof, and any other amounts payable to the Servicer hereunder the
entitlement to which arose prior to the termination of its activities
hereunder.
Notwithstanding the foregoing, a delay in or failure of performance
under clause (i) or (ii) of the definition of Servicing Default, after the
applicable grace periods specified therein, shall not constitute a Servicing
Default if such delay or failure could not be prevented by the exercise of
reasonable diligence by the Servicer and such delay or failure was caused by
an act of God or the public enemy, acts of declared or undeclared war, public
disorder, rebellion or sabotage, epidemics, landslides, lightning, fire,
hurricanes, earthquakes, floods or similar causes. The preceding sentence
shall not relieve the Servicer from using reasonable efforts to perform its
respective obligations in a timely manner in accordance with the terms of
this Agreement. The Servicer shall provide the Indenture Trustee, the Paying
Agent, the Enhancer and the Securityholders with written notice of any such
failure or delay by it, together with a description of its efforts to so
perform its obligations. The Servicer shall immediately notify the Indenture
Trustee, the Paying Agent, the Enhancer and the Issuer in writing of any
Servicing Default.
(c) If the Servicer Termination Triggers shall occur and be continuing with
respect to a Payment Date, then in each and every such case, and so long as
no Enhancer Default exists, the Enhancer may send written notice to the
Securityholders of its intention to remove the Servicer and appoint a
successor Servicer and the date on which such removal will take place;
provided, however, that such date shall be at least 30 days from the date of
such notice. None of the Indenture Trustee, the Paying Agent or the
Securityholders shall have the right to initiate removal of the Servicer if a
Servicer Termination Trigger has occurred.
31
Section 7.02 Indenture Trustee to Act; Appointment of Successor.
(a) On and after the time the Servicer receives a notice of termination
pursuant to Section 7.01 or sends a notice pursuant to Section 6.04, the
Indenture Trustee as pledgee of the Mortgage Loans shall itself become, or
shall appoint an affiliate of the Indenture Trustee to become, the successor
in all respects to the Servicer in its capacity as servicer under this
Agreement and the transactions set forth or provided for herein and shall
immediately assume all of the obligations of the Servicer to make advances on
Mortgage Loans under Section 3.03(b) and will be subject to all other
responsibilities, duties and liabilities relating thereto placed on the
Servicer by the terms and provisions hereof as soon as practicable, but in no
event later than 90 days after the Indenture Trustee becomes successor
servicer. During such 90 day period, the Indenture Trustee, with the written
consent of the Enhancer, may require the Servicer being terminated to
continue to perform such servicing responsibilities (other than making
advances on the Mortgage Loans under Section 3.03(b)) as the Indenture
Trustee deems appropriate. In such event, the Servicer being terminated
shall provide such services as directed by the Indenture Trustee until the
earliest of the date the Indenture Trustee notifies such Servicer to
discontinue providing such services, the date on which a successor servicer
or the Indenture Trustee has assumed all responsibilities, duties and
liabilities of the Servicer hereunder or the expiration of the 90 day
period. The Servicer shall be entitled to the Servicing Fee hereunder for
any period during which the Servicer is obligated to provide such services as
if no termination of the Servicer had occurred. Nothing in this Agreement or
in the Trust Agreement shall be construed to permit or require the Indenture
Trustee to (i) succeed to the responsibilities, duties and liabilities of the
initial Servicer in its capacity as Seller under the Purchase Agreement,
(ii) be responsible or accountable for any act or omission of the Servicer
prior to the issuance of a notice of termination hereunder, (iii) require or
obligate the Indenture Trustee, in its capacity as successor Servicer, to
purchase, repurchase or substitute any Mortgage Loan, (iv) fund any
Additional Balances with respect to any Mortgage Loan, (v) fund any losses on
any Permitted Investment directed by any other Servicer, or (vi) be
responsible for the representations and warranties of the predecessor
Servicer. As compensation therefor, the Indenture Trustee shall be entitled
to such compensation as the Servicer would have been entitled to hereunder if
no such notice of termination had been given. Notwithstanding the foregoing,
if the Indenture Trustee is (x) unwilling to act as successor Servicer itself
or to appoint an affiliate to become successor Servicer, or (y) legally
unable so to act, the Indenture Trustee as pledgee of the Mortgage Loans may
(in the situation described in clause (x)) or shall (in the situation
described in clause (y)) appoint or petition a court of competent
jurisdiction to appoint any established housing and home finance institution,
bank or other mortgage loan servicer having a net worth of not less than
$10,000,000 as the successor to the Servicer hereunder in the assumption of
all or any part of the responsibilities, duties or liabilities of the
Servicer hereunder; provided, however, that any such successor Servicer shall
be acceptable to the Enhancer, as evidenced by the Enhancer's prior written
consent, which consent shall not be unreasonably withheld. Pending
appointment of a successor to the Servicer hereunder, unless the Indenture
Trustee is prohibited by law from so acting, the Indenture Trustee itself
shall act or appoint an affiliate to act in such capacity as provided above.
In connection with such appointment and assumption, the successor shall be
entitled to receive compensation out of payments on Mortgage Loans in an
amount equal to the compensation that the Servicer would otherwise have
received pursuant to Section 3.11 (or such other compensation as the
Indenture Trustee and such successor shall agree). The appointment of a
successor Servicer shall not affect any liability of the predecessor Servicer
that may have arisen under this Agreement prior to its termination as
Servicer (including the obligation to purchase Mortgage Loans pursuant to
Section 3.01, to pay any deductible under an insurance policy pursuant to
Section 3.05 or to indemnify the Indenture Trustee pursuant to Section 6.06),
nor shall any successor Servicer (including the Indenture Trustee) be liable
for any acts or omissions of the predecessor Servicer or for any breach by
such Servicer of any of its representations or warranties contained herein or
in any related document or agreement. The Indenture Trustee and such
successor shall take such action, consistent with this Agreement and the
requirements (including any notice requirements) of applicable law, as shall
be necessary to effectuate any such succession. Notwithstanding the
foregoing, the Indenture Trustee, in its capacity as successor Servicer,
shall not be responsible for the lack of information and/or documents that it
cannot obtain through reasonable efforts or for failing to take any action
that the Indenture Trustee is legally prohibited from taking by applicable
law.
32
(b) Any successor, including the Indenture Trustee, to the Servicer as
servicer shall during its term as Servicer (i) continue to service and
administer the Mortgage Loans for the benefit of the Securityholders, (ii)
maintain in force a policy or policies of insurance covering errors and
omissions in the performance of its obligations as Servicer hereunder and a
fidelity bond in respect of its officers, employees and agents to the same
extent as the Servicer is so required pursuant to Section 3.13 and (iii) be
bound by the terms of the Insurance Agreement.
(c) Any successor Servicer, including the Indenture Trustee, shall not be
deemed in default or to have breached its duties hereunder if the predecessor
Servicer shall fail to deliver any required deposit to the Custodial Account
or otherwise cooperate with any required servicing transfer or succession
hereunder.
(d) All reasonable costs and expenses (including attorneys' fees)
incurred in connection with the transfer of Mortgage Files and the servicing
duties to a successor servicer hereunder shall be paid by the related
predecessor servicer.
Section 7.03 Notification to Securityholders. Upon any termination of
or appointment of a successor to the Servicer pursuant to this Article VII or
Section 6.04, the Indenture Trustee shall give prompt written notice thereof
to the Securityholders, the Enhancer, the Issuer and each Rating Agency.
ARTICLE VIII
Miscellaneous Provisions
Section 8.01 Amendment. This Agreement may be amended from time to time
by the parties hereto, but only by written instrument signed by the parties
hereto; provided, however, that any such amendment shall be accompanied by a
letter from each Rating Agency to the effect that such amendment will not
result in a Rating Event if determined without regard to the Policy;
provided, further, that the Enhancer, the Paying Agent and the Indenture
Trustee shall consent thereto.
Section 8.02 Exhibits. The exhibits to this Agreement are hereby
incorporated and made a part hereof and are an integral part of this
Agreement.
Section 8.03 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICTS OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF
THE GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
33
Section 8.04 Notices. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by certified mail, return receipt requested, to (a) in
the case of the Servicer, Xxx Xxxxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000-0000, Attention: Xxxxx Xxxxx, Re: Wachovia Mortgage Loan
Trust, LLC [______] Trust, Facsimile: (000) 000-0000, (b) in the case of the
Enhancer, [________], [address], Attention: [________], telecopier number
(___) ___-____, (c) in the case of Xxxxx'x, Home Mortgage Loan Monitoring
Group, 4th Floor, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, (d) in the case
of Standard & Poor's, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Residential Mortgage Surveillance Group, (e) in the case of the Owner
Trustee, [________], [address], Attention: [________], telecopier number
(___) ___-____, (f) in the case of the Issuer, Wachovia Mortgage Loan Trust,
LLC [______] Trust, c/o the Owner Trustee at the address set forth in clause
(e) above, (g) in the case of the Indenture Trustee, at the Corporate Trust
Office of the Indenture Trustee, and (h) in the case of the Paying Agent, at
the Corporate Trust Office of the Paying Agent; or, with respect to each of
the foregoing Persons, at such other address as shall be designated by such
Person in a written notice to the other foregoing Persons. Any notice
required or permitted to be mailed to a Securityholder shall be given by
first class mail, postage prepaid, at the address of such Securityholder as
shown in the Note Register or Certificate Register, as the case may be. Any
notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the related
Securityholder receives such notice. Any notice or other document required
to be delivered or mailed by the Indenture Trustee to any Rating Agency shall
be given on a reasonable efforts basis and only as a matter of courtesy and
accommodation, and the Indenture Trustee shall have no liability for failure
to deliver any such notice or document to any Rating Agency.
Section 8.05 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement or the Securities
or the rights of the Securityholders.
Section 8.06 Protection of Confidential Information. The Servicer shall
keep confidential and shall not divulge to any party any information
pertaining to the Mortgage Loans or any Mortgagor thereunder, except as
required pursuant to this Agreement and except to the extent that it is
necessary and appropriate for the Servicer to do so in working with legal
counsel, auditors, taxing authorities, regulatory authorities or other
governmental agencies or in accordance with the Collection Policy.
Section 8.07 Third-Party Beneficiaries. This Agreement shall inure to
the benefit of and be binding upon the parties hereto, the Securityholders,
the Enhancer, the Owner Trustee and their respective successors and permitted
assigns. Except as otherwise provided in this Agreement, no other Person
shall have any right or obligation hereunder. The Enhancer shall be an
express third-party beneficiary of this Agreement.
34
Section 8.08 Counterparts. This instrument may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
Section 8.09 Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
Section 8.10 Termination upon Purchase by the Servicer or Liquidation of
All Mortgage Loans; Partial Redemption.
(a) The respective obligations and responsibilities of the Servicer, the
Issuer, the Paying Agent and the Indenture Trustee created hereby shall
terminate upon the last action required to be taken by the Issuer pursuant to
the Trust Agreement and by the Indenture Trustee and the Paying Agent
pursuant to the Indenture following the earlier of:
(i) the date on or before which the Indenture or the Trust Agreement is
terminated, or
(ii) the purchase by the Servicer from the Issuer of all Mortgage Loans and
REO Property in accordance with Section 8.10(b).
(b) The Servicer shall have the right to purchase from the Issuer all of
the Mortgage Loans and related REO Property if the Note Balance of the Notes
as of any Payment Date is less than 10% of the Note Balance of the Notes as
of the Closing Date, (provided that a draw on the Policy would not occur as a
result of such purchase, and provided further that the purchase price will
provide sufficient funds to pay the outstanding Note Balance and accrued and
unpaid interest on the Notes to the Payment Date on which such amounts are to
be distributed to the Securityholders), at a price equal to 100% of the
aggregate unpaid Principal Balance of all such remaining Mortgage Loans, plus
accrued and unpaid interest thereon at the weighted average of the Loan Rates
thereon up to the date preceding the Payment Date on which such amounts are
to be distributed to the Securityholders (and in the case of REO Property,
the fair market value of the REO Property), plus any amounts due and owing to
the Enhancer under the Insurance Agreement related to the Mortgage Loans or
the Notes (and any unpaid Servicing Fee relating to the Mortgage Loans shall
be deemed to have been paid at such time), plus any Interest Shortfall and
interest owed thereon to the Noteholders. The purchase price paid by the
Servicer shall also include any amounts owed by the Seller pursuant to
Section 3.01(d) of the Purchase Agreement in respect of any liability,
penalty or expense that resulted from a breach of the representation and
warranty set forth in Section 3.01(b)(xi), that remain unpaid on the date of
such purchase.
The Servicer shall send written notice to the Indenture Trustee,
the Paying Agent and the Enhancer of its intent to exercise its right to
purchase any of the Mortgage Loans pursuant to this Section 8.10(b).
If such right is exercised by the Servicer, the Servicer shall
deposit the amount calculated pursuant to this Section 8.08(b) with the
Indenture Trustee or the Paying Agent pursuant to Section 4.10 of the
Indenture and, upon the receipt of such deposit, the Indenture Trustee shall
release to the Servicer, the files pertaining to the Mortgage Loans being
purchased. The Servicer, at its expense, shall prepare and deliver to the
Indenture Trustee for execution, at the time the related Mortgage Loans are
to be released to the Servicer, appropriate documents assigning each such
Mortgage Loans from the Indenture Trustee or the Issuer to the Servicer or
the appropriate party.
35
Section 8.11 Certain Matters Affecting the Indenture Trustee and the
Paying Agent. For all purposes of this Agreement, in the performance of any
of each of their duties or in the exercise of any of either of their powers
hereunder, the Indenture Trustee and the Paying Agent shall be subject to and
entitled to the benefits of Article VI of the Indenture.
Section 8.12 Owner Trustee, Paying Agent and Indenture Trustee Not
Liable for Related Documents. The recitals contained herein shall be taken
as the statements of the Servicer, and the Owner Trustee, the Paying Agent
and the Indenture Trustee assume no responsibility for the correctness
thereof. The Owner Trustee, the Paying Agent and the Indenture Trustee make
no representations as to the validity or sufficiency of this Agreement, of
any Basic Document or Related Document, or of the Certificates (other than
the signatures of the Owner Trustee and the Indenture Trustee on the
Certificates) or the Notes. The Owner Trustee, the Paying Agent and the
Indenture Trustee shall at no time have any responsibility or liability with
respect to the sufficiency of the Trust Estate or its ability to generate the
payments to be distributed to Certificateholders under the Trust Agreement or
the Noteholders under the Indenture, including the compliance by the
Depositor, the Seller or the Servicer with any warranty or representation
made under any Basic Document or the accuracy of any such warranty or
representation, or any action of any person taken in the name of the Owner
Trustee, the Paying Agent or the Indenture Trustee.
ARTICLE IX
Miscellaneous Provisions
Section 9.01 Intent of the Parties; Reasonableness The Depositor, the
Indenture Trustee and the Servicer acknowledge and agree that the purpose of
this Article IX is to facilitate compliance by the Depositor with the
provisions of Regulation AB and related rules and regulations of the
Commission. The Depositor shall not exercise its right to request delivery
of information or other performance under these provisions other than in good
faith, or for purposes other than compliance with the Securities Act, the
Exchange Act and the rules and regulations of the Commission under the
Securities Act and the Exchange Act. Each of the Servicer and the Indenture
Trustee acknowledges that interpretations of the requirements of Regulation
AB may change over time, whether due to interpretive guidance provided by the
Commission or its staff, consensus among participants in the mortgage-backed
securities markets, advice of counsel, or otherwise, and agrees to comply
with reasonable requests made by the Depositor in good faith for delivery of
information under these provisions on the basis of evolving interpretations
of Regulation AB. Each of the Servicer and the Indenture Trustee shall
cooperate reasonably with the Depositor to deliver to the Depositor
(including any of its assignees or designees), any and all disclosure,
statements, reports, certifications, records and any other information
necessary in the reasonable, good faith determination of the Depositor to
permit the Depositor to comply with the provisions of Regulation AB.
Section 9.02 Additional Representations and Warranties of the Indenture
Trustee
36
(a) The Indenture Trustee shall be deemed to represent and warrant to the
Depositor as of the date hereof and on each date on which information is
provided to the Depositor under Sections 9.01, 9.02(b) or 9.03 that, except
as disclosed in writing to the Depositor prior to such date: (i) it is not
aware and has not received notice that any default, early amortization or
other performance triggering event has occurred as to any other
Securitization Transaction due to any default of the Indenture Trustee; (ii)
there are no aspects of its financial condition that could have a material
adverse effect on the performance by it of its trustee obligations under this
Agreement or any other Securitization Transaction as to which it is the
trustee; (iii) there are no material legal or governmental proceedings
pending (or known to be contemplated) against it that would be material to
Noteholders; (iv) there are no relationships or transactions (as described in
Item 1119(b) of Regulation AB) relating to the Indenture Trustee with respect
to the Depositor or any sponsor, issuing entity, servicer, trustee,
originator, significant obligor, enhancement or support provider or other
material transaction party (as each of such terms are used in Regulation AB)
relating to the Securitization Transaction contemplated by this Agreement, as
identified by the Depositor to the Indenture Trustee in writing as of the
Closing Date (each, a "Transaction Party") that are outside the ordinary
course of business or on terms other than would be obtained in an arm's
length transaction with an unrelated third party, apart from the
Securitization Transaction, and that are material to the investors'
understanding of the Term Notes; and (v) the Indenture Trustee is not an
affiliate (as contemplated by Item 1119(a) of Regulation AB) of any
Transaction Party. The Depositor shall notify the Indenture Trustee of any
change in the identity of a Transaction Party after the Closing Date.
(b) If so requested by the Depositor on any date following the Closing
Date, the Indenture Trustee shall, within five Business Days following such
request, confirm in writing the accuracy of the representations and
warranties set forth in paragraph (a) of this Section or, if any such
representation and warranty is not accurate as of the date of such
confirmation, provide the pertinent facts, in writing, to the Depositor. Any
such request from the Depositor shall not be given more than once each
calendar quarter, unless the Depositor shall have a reasonable basis for
questioning the accuracy of any of the representations and warranties
Section 9.03 Information to be provided by the Indenture Trustee For so
long as the Term Notes are outstanding, for the purpose of satisfying the
Depositor's reporting obligation under the Exchange Act with respect to any
class of Term Notes, the Indenture Trustee shall provide to the Depositor a
written description of (a) any litigation or governmental proceedings pending
against the Indenture Trustee as of the last day of each calendar month that
would be material to Noteholders, and (b) any affiliations or relationships
(as described in Item 1119 of Regulation AB) that develop following the
Closing Date between the Indenture Trustee and any Transaction Party of the
type described in Section 9.02(a)(iv) or 9.02(a)(v) as of the last day of
each calendar year. Any descriptions required with respect to legal
proceedings, as well as updates to previously provided descriptions, under
this Section 9.03 shall be given no later than five Business Days prior to
the Determination Date following the month in which the relevant event
occurs, and any notices and descriptions required with respect to
affiliations, as well as updates to previously provided descriptions, under
this Section 9.03 shall be given no later than January 31 of the calendar
year following the year in which the relevant event occurs. As of the
related Payment Date with respect to each Report on Form 10-D with respect to
the Term Notes filed by or on behalf of the Depositor, and as of March 15
preceding the date each Report on Form 10-K with respect to the Term Notes is
filed, the Indenture Trustee shall be deemed to represent and warrant that
any information previously provided by the Indenture Trustee under this
Article IX is materially correct and does not have any material omissions
unless the Indenture Trustee has provided an update to such information. The
Depositor will allow the Indenture Trustee to review any disclosure relating
to material litigation against the Indenture Trustee prior to filing such
disclosure with the Commission to the extent the Depositor changes the
information provided by the Indenture Trustee.
37
Section 9.04 Report on Assessment of Compliance and Attestation Within
90 days after December 31 of each year, the Indenture Trustee shall:
(a) deliver to the Depositor a report (in form and substance
reasonably satisfactory to the Depositor) regarding the Indenture Trustee's
assessment of compliance with the applicable Servicing Criteria during the
immediately preceding calendar year, as required under Rules 13a-18 and
15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such report shall
be signed by an authorized officer of the Indenture Trustee, and shall
address each of the Servicing Criteria specified on Exhibit G hereto; and
(b) deliver to the Depositor a report of a registered public
accounting firm satisfying the requirements of Rule 2-01 of Regulation S-X
under the Securities Act and the Exchange Act that attests to, and reports
on, the assessment of compliance made by the Indenture Trustee and delivered
pursuant to the preceding paragraph. Such attestation shall be in accordance
with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act
and the Exchange Act.
Section 9.05 Indemnification; Remedies
(a) The Indenture Trustee shall indemnify the Depositor, each
affiliate of the Depositor, the Servicer and each affiliate of the Servicer,
and the respective present and former directors, officers, employees and
agents of each of the foregoing, and shall hold each of them harmless from
and against any losses, damages, penalties, fines, forfeitures, legal fees
and expenses and related costs, judgments, and any other costs, fees and
expenses that any of them may sustain arising out of or based upon:
(i) (A) any untrue statement of a material fact contained or
alleged to be contained in any information, report, certification,
accountants' attestation or other material provided under this Article IX by
or on behalf of the Indenture Trustee (collectively, the "Indenture Trustee
Information"), or (B) the omission or alleged omission to state in the
Indenture Trustee Information a material fact required to be stated in the
Indenture Trustee Information or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; or
(ii) any failure by the Indenture Trustee to deliver any
information, report, certification, or other material when and as required
under this Article IX, other than a failure by the Indenture Trustee to
deliver an accountants' attestation.
(b) In the case of any failure of performance described in clause
(ii) of Section 9.05(a), as well as a failure to deliver an accountants'
attestation, the Indenture Trustee shall (i) promptly reimburse the Depositor
for all costs reasonably incurred by the Depositor in order to obtain the
information, report, certification, accountants' attestation or other
material not delivered by the Indenture Trustee as required and (ii)
cooperate with the Depositor to mitigate any damages that may result from
such failure.
38
(c) The Depositor and the Servicer shall indemnify the Indenture
Trustee, each affiliate of the Indenture Trustee and the respective present
and former directors, officers, employees and agents of the Indenture
Trustee, and shall hold each of them harmless from and against any losses,
damages, penalties, fines, forfeitures, legal fees and expenses and related
costs, judgments, and any other costs, fees and expenses that any of them may
sustain arising out of or based upon (i) any untrue statement of a material
fact contained or alleged to be contained in any information provided under
this Agreement by or on behalf of the Depositor or Servicer for inclusion in
any report filed with Commission under the Exchange Act (collectively, the
"Wachovia Information"), or (ii) the omission or alleged omission to state in
the Wachovia Information a material fact required to be stated in the
Wachovia Information or necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
(d) Notwithstanding any provision in this Section 9.05 to the
contrary, the parties agree that none of the Indenture Trustee, the Depositor
or the Servicer shall be liable to the other for any consequential or
punitive damages whatsoever, whether in contract, tort (including negligence
and strict liability), or any other legal or equitable principle; provided,
however, that such limitation shall not be applicable with respect to third
party claims made against a party.
39
IN WITNESS WHEREOF, the Servicer, the Issuer, the Paying Agent and the
Indenture Trustee have caused this Agreement to be duly executed by their
respective officers or representatives all as of the day and year first above
written.
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Servicer
By: _____________________________________
Name:
Title:
WACHOVIA MORTGAGE LOAN TRUST, LLC [_____]
TRUST, as Issuer
By: Wilmington Trust Company, not in its
individual capacity but solely as
Owner Trustee
By: _____________________________________
Name:
Title:
WACHOVIA BANK, NATIONAL ASSOCIATION, as
Paying Agent
By: _____________________________________
Name:
Title:
[_________________], not in its individual
capacity but solely as Indenture Trustee
By: _____________________________________
Name:
Title:
40
EXHIBIT A
MORTGAGE LOAN SCHEDULE
A-1
EXHIBIT B
COLLECTION POLICY
[See attachment]
B-1
EXHIBIT C
LIMITED POWER OF ATTORNEY
KNOW ALL MEN BY THESE PREMISES:
That [_________________], as indenture trustee (the "Indenture
Trustee"), under the indenture dated as of _____ __, 200_ (the "Indenture"),
among Wachovia Mortgage Loan Trust, LLC [______] Trust, as issuer, Wachovia
Bank, National Association, as Paying Agent, and the Indenture Trustee, a
national bank, and having its principal office located at [address], Attn:
_______, hath made, constituted and appointed, and does by these presents
make, constitute and appoint Wachovia Bank, National Association, a national
banking association organized and existing under the laws of the United
States of America, its true and lawful Attorney-in-Fact, with full power and
authority to sign, execute, acknowledge, deliver, file for record, and record
any instrument on its behalf, and to perform such other act or acts as may be
customarily and reasonably necessary and appropriate, to effectuate the
following enumerated transactions in respect of any of the Mortgages securing
a Mortgage Loan and the related Loan Agreements for which the undersigned is
acting as Indenture Trustee for various Securityholders (whether the
undersigned is named therein as mortgagee or beneficiary or has become
mortgagee by virtue of endorsement of such Loan Agreement secured by any such
Mortgage) and for which Wachovia Bank, National Association is acting as
Servicer pursuant to the Servicing Agreement.
This appointment shall apply to the following enumerated transactions only:
1. The modification or re-recording of a Mortgage, where said modification
or re-recording is for the purpose of correcting the Mortgage to
conform same to the original intent of the parties thereto or to
correct title errors discovered after such title insurance was issued
and said modification or re-recording, in either instance, does not
adversely affect the Lien of the Mortgage as insured.
2. The subordination of the Lien of a Mortgage to an easement in favor of
a public utility company or a government agency or unit with powers of
eminent domain; this section shall include, without limitation, the
execution of partial satisfactions/releases, partial reconveyances or
the execution of requests to trustees to accomplish same.
3. With respect to a Mortgage, the foreclosure, the taking of a deed in
lieu of foreclosure, or the completion of judicial or non-judicial
foreclosure or termination, cancellation or rescission of any such
foreclosure, including, without limitation, any and all of the
following acts:
a. The substitution of trustee(s) serving under a Mortgage, in
accordance with state law and the Mortgage;
b. The preparation and issuance of statements of breach or
non-performance;
c. The preparation and issuance of notices of default;
d. Cancellations/rescissions of notices of default and/or notices of
sale;
C-1
e. The taking of a deed in lieu of foreclosure; and
f. Such other documents and actions as may be necessary under the
terms of the Mortgage or state law to expeditiously complete said
transactions.
4. The conveyance of the properties to the mortgage insurer, or the
closing of the title to the property to be acquired as real estate
owned, or conveyance of title to real estate owned.
5. The completion of loan assumption agreements.
6. The full satisfaction/release of a Mortgage or full reconveyance upon
payment and discharge of all sums secured thereby, including, without
limitation, cancellation of the related Loan Agreement.
7. The assignment of any Mortgage and the related Loan Agreement, in
connection with the repurchase of the Mortgage Loan secured and
evidenced thereby.
8. The full assignment of a Mortgage upon payment and discharge of all
sums secured thereby in conjunction with the refinancing thereof,
including, without limitation, the endorsement of the related Loan
Agreement.
9. The modification or re-recording of a Mortgage, where said modification
or re-recording is for the purpose of any modification pursuant to
Section 4.01 of the Servicing Agreement.
10. The subordination of the Lien of a Mortgage, where said subordination
is in connection with any modification pursuant to Section 3.01 of the
Servicing Agreement, and the execution of partial
satisfactions/releases in connection with such same Section 3.01.
The undersigned gives said Attorney-in-Fact full power and authority to
execute such instruments and to do and perform all and every act and thing
necessary and proper to carry into effect the power or powers granted by or
under this Limited Power of Attorney as fully as the undersigned might or
could do, and hereby does ratify and confirm to all that said
Attorney-in-Fact shall lawfully do or cause to be done by authority hereof.
Capitalized terms used herein that are not otherwise defined shall have
the meanings ascribed thereto in Appendix A to the Indenture.
C-2
Third parties without actual notice may rely upon the exercise of the
power granted under this Limited Power of Attorney and may be satisfied that
this Limited Power of Attorney shall continue in full force and effect and
has not been revoked, unless an instrument of revocation has been made in
writing by the undersigned.
[_________________],
not in its individual capacity
but solely as Indenture Trustee
By: _________________________________
Name:
Title:
C-3
STATE OF )
SS.
COUNTY OF )
On this ____ day of ____, 200_, before me the undersigned, Notary
Public of said State, personally appeared__________________, personally known to
me to be duly authorized officers of [_________________] that executed the within
instrument and personally known to me to be the persons who executed the
within instrument on behalf of [_________________] therein named, and
acknowledged to me such [_________________] executed the within instrument
pursuant to its by-laws.
WITNESS my hand and official seal.
Notary Public in and for the
State of ___________________________
After recording, please mail to:
Attn:_________________________
C-4
EXHIBIT D
FORM OF REQUEST FOR RELEASE
DATE:
TO:
RE: REQUEST FOR RELEASE OF DOCUMENTS
In connection with your administration of the Mortgage Loans, we request the
release of the Mortgage File described below.
Servicing Agreement Dated:
Series #:
Account #:
Pool #:
Loan #:
Borrower Name(s):
Reason for Document Request: (circle one) Mortgage Loan
Prepaid in Full Mortgage Loan Repurchased
"We hereby certify that all amounts received or to be received in connection
with such payments which are required to be deposited have been or will be so
deposited as provided in the Servicing Agreement."
___________________________________
Wachovia Bank, National Association
Authorized Signature
******************************************************************************
TO CUSTODIAN: Please acknowledge this request, and check off documents being
enclosed with a copy of this form. You should retain this form for your
files in accordance with the terms of the Servicing Agreement.
Enclosed Documents: [ ] Loan Agreement
Name _________________________
Title ________________________
D-1
EXHIBIT E
FORM OF FORM 10-K CERTIFICATE
I, [identify the certifying individual], certify that:
1. I have reviewed this report on Form 10-K and all reports on Form 10-D
required to be filed in respect of the period covered by this report on Form
10-K of the trust (the Exchange Act periodic reports) pursuant to the
Servicing Agreement dated [ ], 20[ ] (the "Agreement") among
Wachovia Bank, National Association, as servicer (the "Servicer"), the
Wachovia Mortgage Loan Trust, LLC [______] Trust, as issuer (the "Issuer"),
Wachovia Bank, National Association, as Paying Agent (the "Paying Agent"),
and [_________________], as indenture trustee (the "Indenture Trustee").
2. Based on my knowledge, Exchange Act periodic reports, taken as a whole,
do not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with
respect to the period covered by this report;
3. Based on my knowledge, all of the distribution, servicing and other
information required to be provided under Form 10-D for the period covered by
this report is included in the Exchange Act periodic reports;
4. I am responsible for reviewing the activities performed by the Servicer
and based on my knowledge and the compliance review conducted in preparing
the servicer compliance statement required in this report under Item 1123 of
Regulation AB and except as disclosed in the Exchange Act periodic reports,
the Servicer has fulfilled its obligations under the Agreement; and
5. All of the reports on assessment of compliance with servicing
criteria for asset-backed securities and their related attestation reports on
assessment of compliance with servicing criteria for asset-backed securities
required to be included in this report in accordance with Item 1122 of
Regulation AB and Exchange Act Rules 13a-18 and 15d-18 have been included as
an exhibit to this report, except as otherwise disclosed in this report. Any
material instances of noncompliance described in such reports have been
disclosed in this report on Form 10-K.
In giving the certifications above, I have reasonably relied on the
information provided to me by the following unaffiliated parties: [the
Indenture Trustee].
Date:____________
_________________________________*
[Signature]
Name:
Title:
* - to be signed by the senior officer in charge of the servicing functions
of the Servicer
E-1
EXHIBIT F
FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE
The undersigned, a Responsible Officer of [__________] (the "Indenture
Trustee") certifies that:
(a) The Indenture Trustee has performed all of the duties
specifically required to be performed by it pursuant to the provisions of
the Servicing Agreement dated as of [ ], 20[ ] (the "Agreement")
by and among Wachovia Bank, National Association, as servicer (the
"Servicer"), the Wachovia Mortgage Loan Trust, LLC [______] Trust, as
issuer (the "Issuer"), Wachovia Bank, National Association, as Paying
Agent (the "Paying Agent"), and the Indenture Trustee in accordance with
the standards set forth therein.
(b) Based on my knowledge, the list of Securityholders as shown on
the Certificate Register and the Note Register as of the end of each
calendar year that is provided by the Indenture Trustee pursuant to the
Agreement is accurate as of the last day of the 20[ ] calendar year.
Capitalized terms used and not defined herein shall have the
meanings given such terms in the Agreement.
IN WITNESS WHEREOF, I have duly executed this certificate as of _________,
20__.]
Name: _____________________________
Title: _____________________________
F-1
EXHIBIT G
SERVICING CRITERIA
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by the Indenture Trustee
shall address, at a minimum, the criteria identified as below as "Applicable
Servicing Criteria":
------------------------------------------------------------------------------
Applicable
Servicing
Servicing Criteria Criteria
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Reference Criteria
------------------------------------------------------------------------------
------------------------------------------------------------------------------
General Servicing Considerations
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(1)(i) Policies and procedures are instituted to
monitor any performance or other triggers and
events of default in accordance with the
transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(1)(ii) If any material servicing activities are
outsourced to third parties, policies and
procedures are instituted to monitor the third
party's performance and compliance with such
servicing activities.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(1)(iii) Any requirements in the transaction agreements
to maintain a back-up servicer for the pool
assets are maintained.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(1)(iv) A fidelity bond and errors and omissions
policy is in effect on the party participating
in the servicing function throughout the
reporting period in the amount of coverage
required by and otherwise in accordance with
the terms of the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Cash Collection and Administration
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(2)(i) Payments on pool assets are deposited into the |X| (as to
appropriate custodial bank accounts and accounts held
related bank clearing accounts no more than by Trustee)
two business days following receipt, or such
other number of days specified in the
transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(2)(ii) Disbursements made via wire transfer on behalf |X| (as to
of an obligor or to an investor are made only investors only)
by authorized personnel.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(2)(iii) Advances of funds or guarantees regarding
collections, cash flows or distributions, and
any interest or other fees charged for such
advances, are made, reviewed and approved as
specified in the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
The related accounts for the transaction, such
as cash reserve accounts or accounts
established as a form of |X| (as to
overcollateralization, are separately accounts held
maintained (e.g., with respect to commingling by Trustee)
of cash) as set forth in the transaction
1122(d)(2)(iv) agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(2)(v) Each custodial account is maintained at a
federally insured depository institution as
set forth in the transaction agreements. For
purposes of this criterion, "federally insured
depository institution" with respect to a
foreign financial institution means a foreign
financial institution that meets the
requirements of Rule 13k-1(b)(1) of the
Securities Exchange Act.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(2)(vi) Unissued checks are safeguarded so as to
prevent unauthorized access.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(2)(vii) Reconciliations are prepared on a monthly
basis for all asset-backed securities related
bank accounts, including custodial accounts
and related bank clearing accounts. These
reconciliations are (A) mathematically
accurate; (B) prepared within 30 calendar days
after the bank statement cutoff date, or such
other number of days specified in the
transaction agreements; (C) reviewed and
approved by someone other than the person who
prepared the reconciliation; and (D) contain
explanations for reconciling items. These
reconciling items are resolved within 90
calendar days of their original
identification, or such other number of days
specified in the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
G-1
------------------------------------------------------------------------------
Investor Remittances and Reporting
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(3)(i) Reports to investors, including those to be
filed with the Commission, are maintained in
accordance with the transaction agreements and
applicable Commission requirements.
Specifically, such reports (A) are prepared in
accordance with timeframes and other terms set
forth in the transaction agreements; (B)
provide information calculated in accordance
with the terms specified in the transaction
agreements; (C) are filed with the Commission
as required by its rules and regulations; and
(D) agree with investors' or the trustee's
records as to the total unpaid principal
balance and number of pool assets serviced by
the servicer.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(3)(ii) Amounts due to investors are allocated and |X|
remitted in accordance with timeframes,
distribution priority and other terms set
forth in the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Disbursements made to an investor are posted
within two business days to the servicer's
investor records, or such other number of days |X|
1122(d)(3)(iii) specified in the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Amounts remitted to investors per the investor
reports agree with cancelled checks, or other |X|
1122(d)(3)(iv) form of payment, or custodial bank statements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Pool Asset Administration
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(i) Collateral or security on pool assets is
maintained as required by the transaction
agreements or related asset pool documents.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Pool assets and related documents are
safeguarded as required by the transaction
1122(d)(4)(ii) agreements
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(iii) Any additions, removals or substitutions to
the asset pool are made, reviewed and approved
in accordance with any conditions or
requirements in the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(iv) Payments on pool assets, including any
payoffs, made in accordance with the related
pool asset documents are posted to the
servicer's obligor records maintained no more
than two business days after receipt, or such
other number of days specified in the
transaction agreements, and allocated to
principal, interest or other items (e.g.,
escrow) in accordance with the related pool
asset documents.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(v) The servicer's records regarding the pool
assets agree with the servicer's records with
respect to an obligor's unpaid principal
balance.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(vi) Changes with respect to the terms or status of
an obligor's pool asset (e.g., loan
modifications or re-agings) are made, reviewed
and approved by authorized personnel in
accordance with the transaction agreements and
related pool asset documents.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g.,
forbearance plans, modifications and deeds in
lieu of foreclosure, foreclosures and
repossessions, as applicable) are initiated,
conducted and concluded in accordance with the
timeframes or other requirements established
by the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(vii) Records documenting collection efforts are
maintained during the period a pool asset is
delinquent in accordance with the transaction
agreements. Such records are maintained on at
least a monthly basis, or such other period
specified in the transaction agreements, and
describe the entity's activities in monitoring
delinquent pool assets including, for example,
phone calls, letters and payment rescheduling
plans in cases where delinquency is deemed
temporary (e.g., illness or unemployment).
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(ix) Adjustments to interest rates or rates of
return for pool assets with variable rates are
computed based on the related pool asset
documents.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
G-2
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(x) Regarding any funds held in trust for an
obligor (such as escrow accounts): (A) such
funds are analyzed, in accordance with the
obligor's pool asset documents, on at least an
annual basis, or such other period specified
in the transaction agreements; (B) interest on
such funds is paid, or credited, to obligors
in accordance with applicable pool asset
documents and state laws; and (C) such funds
are returned to the obligor within 30 calendar
days of full repayment of the related pool
asset, or such other number of days specified
in the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(xi) Payments made on behalf of an obligor (such as
tax or insurance payments) are made on or
before the related penalty or expiration
dates, as indicated on the appropriate bills
or notices for such payments, provided that
such support has been received by the servicer
at least 30 calendar days prior to these
dates, or such other number of days specified
in the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(xii) Any late payment penalties in connection with
any payment to be made on behalf of an obligor
are paid from the servicer's funds and not
charged to the obligor, unless the late
payment was due to the obligor's error or
omission.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Disbursements made on behalf of an obligor are
posted within two business days to the
obligor's records maintained by the servicer,
or such other number of days specified in the
1122(d)(4)(xii) transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible
accounts are recognized and recorded in
accordance with the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Any external enhancement or other support,
identified in Item 1114(a)(1) through (3) or
Item 1115 of Regulation AB, is maintained as |X|
1122(d)(4)(xv) set forth in the transaction agreements.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
G-3
