EXHIBIT 99.9
REGULATION AB AMENDMENT TO SERVICING AGREEMENT
This REGULATION AB AMENDMENT TO SERVICING AGREEMENT dated as of March 1,
2006 (the "Amendment") between WASHINGTON MUTUAL BANK, a savings bank organized
under the laws of the United States, as servicer (the "Servicer"), and XXXXXXX
XXXXX MORTGAGE LENDING, INC., a Delaware corporation, as owner (the "Owner"), is
made with respect to the Servicing Agreement dated as of November 1, 2005, (the
"Original Servicing Agreement") between the Servicer and the Owner. Capitalized
terms used in this Amendment without definition have the meanings assigned to
them in the Original Servicing Agreement.
The parties wish to amend the Original Servicing Agreement in order to
facilitate compliance by the Owner and its assignees with Regulation AB (as
defined below).
Accordingly, the parties agree as follows:
ARTICLE I
AMENDMENTS
SECTION 1.1. DEFINITIONS
(a) Article 1 of the Original Servicing Agreement is amended by adding the
following definitions:
Commission: The United States Securities and Exchange Commission.
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Issuing Entity: The issuing entity, as such term is defined in
Regulation AB, with respect to any Securitization Transaction.
Master Servicer: With respect to any Securitization Transaction, the
"master servicer," if any, identified in the related transaction documents,
to the extent such master servicer is responsible for executing the
Sarbanes Certification or any other report filed with the Commission under
the Exchange Act.
Participating Entity: As defined in Section 8.7(a)(iii).
Permitted Reconstitution: As defined in Section 8.1(a).
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
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Reconstitution Agreement: An agreement or agreements entered into by
the Servicer and the Owner and/or certain third parties, including a master
servicer, in connection with a Reconstitution with respect to any or all of
the Mortgage Loans serviced under this Agreement.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. Sections 229.1100-229.1123, as such may be amended from time
to time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531
(Jan. 7, 2005)) or by the staff of the Commission, or as may be provided by
the Commission or its staff from time to time.
Required Notice: With respect to any Reconstitution, 15 days' prior
written notice (i) accompanied by loan-level data with respect to the
Mortgage Loans intended for inclusion in such Reconstitution and (ii)
specifying the percentage of mortgage loans in the entire related
transaction that consist of Mortgage Loans.
Sarbanes Certification: As defined in Section 8.7(a)(iv).
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction: Any transaction involving either (1) a
sale or other transfer of some or all of the Mortgage Loans directly or
indirectly to an issuing entity in connection with an issuance of publicly
offered or privately placed, rated or unrated mortgage-backed securities or
(2) an issuance of publicly offered or privately placed, rated or unrated
securities, the payments on which are determined primarily by reference to
one or more portfolios of residential mortgage loans consisting, in whole
or in part, of some or all of the Mortgage Loans.
Servicer Information: The information provided by the Servicer, any
Subservicer or any Subcontractor pursuant to Section 8.5(a) and (b).
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d)
of Regulation AB, as such may be amended from time to time.
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Subcontractor: Any vendor, subcontractor or other Person that is not
responsible for the overall servicing (as "servicing" is commonly
understood by participants in the mortgage-backed securities market) of
Mortgage Loans but performs one or more discrete functions identified in
Item 1122(d) of Regulation AB with respect to Mortgage Loans under the
direction or authority of the Servicer or a Subservicer.
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Subservicer: Any Person that services Mortgage Loans on behalf of the
Servicer or any Subservicer and is responsible for the performance (whether
directly or through Subservicers or Subcontractors) of a substantial
portion of the material servicing functions required to be performed by the
Servicer under this Agreement or any Reconstitution Agreement that are
identified in Item 1122(d) of Regulation AB.
(b) Article 1 of the Original Servicing Agreement is amended by amending
and restating the following definitions in their entirety:
Disclosure Document: With respect to any Securitization Transaction, a
prospectus, prospectus supplement, private placement memorandum or offering
circular prepared in connection with such Securitization Transaction.
Portfolio Loans: As defined in Section 8.1(e).
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
(c) Article 1 of the Original Servicing Agreement is amended by deleting
the following definitions: "Certification Cure Deadline," "Pass-Through
Transfer" and "Servicer's Information."
(d) The following provisions of the Original Servicing Agreement shall
cease to be effective as of December 31, 2006: Sections 4.4 and 4.5 and the
related definitions of "Indemnitee," "Management Assertion" and "USAP" in
Article 1.
(e) Section 5.6 of the Original Servicing Agreement is amended and restated
in its entirety to read as follows:
SECTION 5.6 TRANSFER OF MORTGAGE LOANS
(a) The Owner shall have the right, without the consent of the
Servicer, to assign its interest under this Agreement with respect to any
Mortgage Loans; provided, however, that (i) the Owner shall give the
Servicer Required Notice prior to any such assignment of its interest under
this Agreement and (ii) in connection with any Reconstitution, the Owner
shall comply with the provisions of Section 8.1(a) hereof. The Owner shall
also have the right to designate any Person to exercise the rights of Owner
hereunder to the extent provided in Section 8.1(f) of this Agreement. In
any such case, all references to the Owner shall be deemed to include such
assignee.
(b) The Servicer shall keep books and records in which, subject to
such reasonable regulations as it may prescribe, the Servicer shall note
transfers of Mortgage Loans. For the purposes of this Agreement, the
Servicer shall be under no obligation to deal with any Person with respect
to this Agreement or any Mortgage Loan unless the books and records show
such person as the owner of such Mortgage Loan. Upon receipt of a written
notice from the Owner of any assignment of any
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Mortgage Loan, the Servicer shall xxxx its books and records to reflect the
ownership of such Mortgage Loan by such assignee.
(f) Section 6.1 of the Original Servicing Agreement is amended and restated
in its entirety to read as follows:
SECTION 6.1. EVENTS OF DEFAULT
In case one or more of the following Events of Default by the Servicer
shall occur and be continuing:
(i) any failure by the Servicer to remit to the Owner when due
any payment required to be made under the terms of this Agreement, which
failure continues unremedied for a period of three (3) Business Days after
the date on which written notice of such failure, requiring the same to be
remedied, shall have been received by the Servicer, from the Owner; or
(ii) except as otherwise provided in clause (viii) or (ix) below,
any failure by the Servicer to duly observe or perform, in any material
respect, any other covenant, obligation or agreement of the Servicer as set
forth in this Agreement, which failure continues unremedied for a period of
thirty (30) days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Servicer by
the Owner; or
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshaling
of assets and liabilities, or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Servicer
and such decree or order shall have remained in force, undischarged or
unstayed for a period of sixty (60) days; or
(iv) the Servicer shall consent to the appointment of a
conservator, receiver or liquidator in any insolvency, readjustment of
debt, marshaling of assets and liabilities or similar proceedings of or
relating to the Servicer or relating to all, or substantially all, of the
Servicer's property; or
(v) the Servicer shall admit in writing its inability to pay its
debts as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its
obligations; or
(vi) the Servicer shall fail to be an approved servicer of
mortgage loans for Xxxxxx Xxx and Xxxxxxx Mac in good standing; or
(vii) the Servicer shall attempt to assign this Agreement or the
servicing responsibilities hereunder in contravention of this Agreement; or
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(viii) any failure by the Servicer, any Subservicer or
Subcontractor to deliver any information, report, certification,
accountants' letter or other material when and as required under Sections
8.4(b), 8.5(b), 8.5(c) or 8.5(d); or
(ix) any failure by the Servicer, any Subservicer or any
Subcontractor to deliver any information, report, certification or
accountants' letter when and as required under Section 8.6 or 8.7,
including any failure by the Servicer to identify pursuant to Section
8.8(b) any Subcontractor "participating in the servicing function" within
the meaning of Item 1122 of Regulation AB (unless such failure to identify
a Subcontractor as a Participating Entity was attributable solely to the
role or function of such Subcontractor with respect to mortgage loans other
than Mortgage Loans), which failure continues unremedied for five calendar
days after the date on which such information, report, certification or
accountants' letter was required; or
(x) failure by the Servicer to be in compliance with the "doing
business" or licensing laws of any jurisdiction where a Mortgaged Property
is located;
then, and in each and every such case, so long as such Event of Default
shall not have been remedied, the Owner, by notice in writing to the
Servicer (in each such instance, the "Defaulted Servicer"), may, in
addition to whatever rights the Owner may have at law or equity, including
injunctive relief and specific performance, commence termination of all of
the rights and obligations of the Defaulted Servicer under this Agreement
pursuant to Section 7.2, and may exercise any and all other remedies
available at law or at equity. Notwithstanding the foregoing, with respect
to any failure described in clause (viii) or (ix) above, in the event that
the Defaulted Servicer (or any applicable Subservicer or Subcontractor)
delivers any missing information, report, certification or accountants'
letter, following the date on which such delivery is due (and, in the case
of clause (ix) following the expiration of the five calendar day cure
period provided therein), and the Master Servicer or Depositor, as the case
may be, despite such late delivery, files the related Exchange Act report
on time without having to file a Form 12b-25 related to a notification of
an inability to make a timely Exchange Act report filing and the Servicer
indemnifies and promptly reimburses the Master Servicer and Depositor
pursuant to Section 8.9(b) for all costs and expenses incurred as a result
of such delay, any notice given by the Master Servicer declaring an Event
of Default shall be automatically revoked and the delay in providing the
missing information, report, certification or accountants' letter shall
cease to constitute an Event of Default. Upon receipt by the Defaulted
Servicer of such written notice from the Owner stating the intent to
terminate the Defaulted Servicer as servicer under this Agreement as a
result of such Event of Default, all authority and power of the Defaulted
Servicer under this Agreement, whether with respect to the Mortgage Loans
or otherwise, shall pass to and be vested in the successor appointed
pursuant to Section 9.1. Upon written request from the Owner, the Defaulted
Servicer shall, at its sole expense, prepare, execute, and place in such
successor's possession or control all Collateral Files and Credit Files,
and do or
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cause to be done all other acts or things necessary or appropriate to
effect the purposes of such notice of termination, all of which shall be
undertaken immediately and shall be completed as soon as possible and in
all events by not later than forty-five (45) Business Days following the
Owner's request therefor. The Defaulted Servicer agrees to cooperate with
the Owner and such successor in effecting the termination of the Defaulted
Servicer's responsibilities and rights hereunder, including, without
limitation, the transfer to such successor of all cash amounts that have
been credited by the Defaulted Servicer to the Account or the Escrow
Account at the time of transfer, and all other amounts that may thereafter
be received with respect to the Mortgage Loans and to which the Defaulted
Servicer is not entitled pursuant to the terms of this Agreement. The
Defaulted Servicer shall promptly reimburse the Owner (or any designee of
the Owner, such as a master servicer) and any Depositor, as applicable, for
all reasonable expenses incurred by the Owner (or such designee) or such
Depositor as such are incurred, in connection with the termination of the
Defaulted Servicer as servicer and the transfer of servicing of the
Mortgage Loans to a successor servicer.
(g) Article 8 of the Original Servicing Agreement is amended and restated
in its entirety to read as follows:
ARTICLE 8
RECONSTITUTIONS; REGULATION AB COMPLIANCE
SECTION 8.1 RECONSTITUTIONS; SERVICER'S PURCHASE RIGHT, APPOINTMENT OF
MASTER SERVICER
(a) The Owner and the Servicer agree that in connection with any
Reconstitution meeting the requirements of this Section 8.1(a) (a
"Permitted Reconstitution"), the Owner may, in its sole discretion, upon
Required Notice to the Servicer, assign its rights under this Agreement
with respect to some or all of the Mortgage Loans subject to such
Reconstitution provided that no such Reconstitution may be effected by
Owner or any of its permitted assignees with respect to the Mortgage Loans
if, as a result thereof: (i) more than three (3) investors would own
Mortgage Loans in such Loan Pool at any one time; provided, that the
Purchaser's completion of a Clean-Up Transfer (as defined below) shall not
be counted for purposes of this subclause (i); (ii) the Owner or its
designee shall fail to use commercially reasonable efforts to provide the
Servicer with initial drafts of all documents for which the Servicer is
requested to become a party in connection with such Reconstitution at least
ten (10) days prior to the related settlement date (the "Subsequent
Transfer Settlement Date"); (iii) the Owner or its designee shall fail to
use commercially reasonable efforts to provide the Servicer with a final
list of the Mortgage Loans subject to such Reconstitution at least two (2)
Business Days prior to the related Subsequent Transfer Settlement Date;
(iv) no Mortgage Loan shall be subject to more than one (1) Reconstitution
in any given Due Period; (v) the related Subsequent Transfer Settlement
Date occurs on or prior to the related Servicing Cut-Off Date; or (vi) any
single investor would own Mortgage Loans having an aggregate unpaid
principal
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balance immediately following such Reconstitution of less than $5,000,000;
provided, that the Purchaser may complete one Reconstitution with a pool
having an aggregate unpaid principal balance of less than $5,000,000 (such
transfer a "Clean-Up Transfer").
(b) The Owner shall promptly notify the Servicer if the percentage of
Mortgage Loans in the entire related transaction increases above the
percentage specified in the Required Notice.
(c) The Owner shall reimburse the Servicer for all reasonable
out-of-pocket expenses, including attorneys' fees, incurred by the Servicer
in connection with any Reconstitution.
(d) With respect to any Permitted Reconstitution, the Servicer shall
(i) provide the Owner with information and appropriate verification of
information in its possession or control as may reasonably be necessary in
order to effect such Reconstitution (and, to the extent any such
information is in the possession or control of any third party, use
commercially reasonable efforts to cause such third party to provide such
information) and (ii) cooperate with all reasonable requests and due
diligence procedures not otherwise addressed herein.
(e) If, at any time, the aggregate Unpaid Principal Balance of any
Mortgage Loans serviced hereunder and retained by the Owner ("Portfolio
Loans") is less than or equal to one percent (1%) of the Unpaid Principal
Balance of such Portfolio Loans as of the related Closing Date, the
Servicer may elect, in its sole discretion, to purchase such Portfolio
Loans. The purchase price of Mortgage Loans purchased by the Servicer
pursuant to this Section 8.1(e) shall equal the lesser of (i) the aggregate
fair market value of such Mortgage Loans at the time of purchase by the
Servicer and (ii) the aggregate Unpaid Principal Balance of such Mortgage
Loans, plus the amount of interest on such Unpaid Principal Balance at the
applicable Net Rate from the date to which interest has last been paid and
distributed to the Owner to, and including, the last day of the month in
which such purchase occurs.
(f)(i) Notwithstanding anything to the contrary contained in this
Agreement, the Owner shall have the right, in its sole discretion, upon (x)
thirty (30) days' prior written notice to the Servicer with respect to any
Portfolio Mortgage Loans or (y) fifteen (15) days' prior written notice to
the Servicer with respect to any Permitted Reconstitution, to appoint and
designate a master servicer (the "Master Servicer"), as master servicer of
Mortgage Loans. Upon receipt of written notice of such appointment, the
Servicer shall promptly enter into a servicing agreement (a "Reconstituted
Servicing Agreement") to service the Mortgage Loans for the Master Servicer
in accordance with the Master Servicer's requirements; provided, however,
that the Servicer shall be under no obligation to enter into any
Reconstituted Servicing Agreement unless the obligations and duties of the
Servicer as a subservicer thereunder (A) are not materially different from
than those set forth herein, (B) do not cause undue
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burden on the Servicer, (C) do not expand in any material respect any of
the obligations, duties or liabilities of the Servicer hereunder and (D)
will not result in any increased cost to the Servicer. If the Servicer and
the Master Servicer enter into a Reconstituted Servicing Agreement, the
Servicer shall service the Mortgage Loans, and remit and report to the
Master Servicer, in accordance with the terms of the Reconstituted
Servicing Agreement and, to the extent inconsistent therewith, the
servicing provisions set forth in this Agreement shall be superseded by the
Reconstituted Servicing Agreement. If the Servicer and the Master Servicer
do not enter into a Reconstituted Servicing Agreement, the Servicer shall
service the Mortgage Loans, and remit and report to the Master Servicer, in
accordance with the terms of this Agreement.
(ii) Upon appointment of a Master Servicer in accordance with
Section 8.1(f)(i), the Servicer shall correspond and communicate solely
with the Master Servicer regarding the servicing of the Mortgage Loans. The
Master Servicer shall have the right as designee of the Owner to enforce
the covenants and conditions set forth in this Agreement, and the Servicer
shall follow and shall be entitled to rely on the instructions of the
Master Servicer under this Agreement as if such instructions were the
instructions of the Owner. The Master Servicer shall have the right to give
any waivers or consents required or allowed under this Agreement on behalf
of the Owner, and the Servicer shall be entitled to rely on such waivers
and consents as if such waivers or consents were the waivers or consents of
the Owner. The Master Servicer is empowered to enter into and execute and
deliver any amendments or modifications to this Agreement as the Owner's
designee hereunder, and such amendments or modifications shall be binding
upon the Owner as if the Owner had executed and delivered the same.
(iii) Upon receipt of notice of termination of the Master
Servicer, the Servicer shall no longer deal with the Master Servicer and
shall instead deal directly with the Owner. From and after receipt of such
notice of termination of the Master Servicer, the Servicer shall service
the applicable Mortgage Loans in accordance with the provisions of this
Agreement and shall give no effect to any Master Servicing Agreement
entered into with the Master Servicer.
SECTION 8.2 RECONSTITUTION AGREEMENTS
In connection with each Permitted Reconstitution, the Servicer shall:
(i) execute and deliver a Reconstitution Agreement containing
terms and conditions that are consistent with the terms and conditions set
forth herein and in the Purchase Agreement and, in the case of a
Securitization Transaction, that are customary for publicly offered
securities or privately placed securities, as the case may be, backed by
mortgage loans similar to the Mortgage Loans included in such
Securitization Transaction, provided that (A) any servicing reporting
requirements must be consistent with the standard practices of the
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Servicer; and (B) such Reconstitution Agreement does not expand in any
material respect any of the obligations, duties or liabilities of the
Servicer under this Agreement or result in any increased cost to the
Servicer;
(ii) with respect to any Securitization Transaction in which all
or substantially all of the mortgage loans in the entire related
transaction consist of Mortgage Loans, (A) execute and deliver a pooling
and servicing agreement that meets the requirements of clause (i) above,
provided that each of the parties to such pooling and servicing agreement
negotiates in good faith any terms or conditions in such pooling and
servicing agreement not specifically referenced or provided for under this
Agreement or the Purchase Agreement; and (B) provide the Owner with
opinions of counsel as to the Servicer's corporate authority and the
enforceability of the pooling and servicing agreement against the Servicer
and certificates from public officials, each as the Servicer shall
reasonably determine to be necessary to effect such Securitization
Transaction; and
(iii) in the event the Owner or its assignee elects to appoint
and designate a master servicer of Mortgage Loans pursuant to a
Reconstitution Agreement, (A) the Servicer shall service the Mortgage
Loans, and remit and report to the master servicer, in accordance with the
terms of this Agreement and the related Reconstitution Agreement; (B) the
master servicer shall have the right as designee of the Owner to enforce
the covenants and conditions set forth in, and to give any waivers or
consents required or allowed under, this Agreement on behalf of the Owner;
and (C) the Servicer shall follow and shall be entitled to rely on the
instructions and any waiver or consents of the master servicer under this
Agreement as if such instructions were the instructions of the Owner.
SECTION 8.3 INTENT OF THE PARTIES; REASONABLENESS
The Owner and the Servicer acknowledge and agree that the purpose of
Sections 8.4, 8.5, 8.6, 8.7, 8.8 and 8.9 is to facilitate compliance by the
Owner and any Depositor with the provisions of Regulation AB and related
rules and regulations of the Commission. Although Regulation AB is
applicable by its terms only to offerings of asset-backed securities that
are registered under the Securities Act, the Company acknowledges that
investors in privately offered securities may require that the Purchaser
and any Depositor provide comparable disclosure in unregistered offerings.
References in this Agreement to compliance with Regulation AB include
provision of comparable disclosure in private offerings.
Neither the Owner nor any Depositor shall 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 thereunder (or the provision in a private offering of disclosure
comparable to that required under the Securities Act). The Servicer
acknowledges that interpretations of the
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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 asset-backed securities markets, advice of
counsel, or otherwise, and agrees to comply with requests made by the
Owner, the Master Servicer or any Depositor in good faith for delivery of
information under these provisions on the basis of evolving interpretations
of Regulation AB. Each party agrees that it shall cooperate in good faith
to amend this Amendment and/or the Original Servicing Agreement in light of
any changes in the interpretations of the requirements of Regulation AB
over time, whether due to interpretive guidance provided by the Commission
or its staff, consensus among participants in the asset-backed securities
markets, advice of counsel, or otherwise. In connection with any
Securitization Transaction, the Servicer shall cooperate fully with the
Owner and the Master Servicer to deliver to the Owner (including any of its
assignees or designees), the Master Servicer and any Depositor, any and all
statements, reports, certifications, records and any other information
necessary in the good faith determination of the Owner, the Master Servicer
or such Depositor to permit the Owner, the Master Servicer or such
Depositor to comply with the provisions of Regulation AB, together with
such disclosures relating to the Servicer, any Subservicer, any Third-Party
Originator and the Mortgage Loans, or the servicing of the Mortgage Loans,
reasonably believed by the Owner or such Depositor to be necessary in order
to effect such compliance.
The Owner (including any of its assignees or designees) shall
cooperate with the Servicer by providing timely notice of requests for
information under these provisions and by reasonably limiting such requests
to information required, in the Owner's reasonable judgment, to comply with
Regulation AB.
SECTION 8.4 ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE SERVICER
(a) The Servicer shall be deemed to represent to the Owner and to any
Depositor, as of the date on which information is first provided to the
Owner or such Depositor under Section 8.5 for a Permitted Reconstitution
that, except as disclosed in writing to the Owner or such Depositor, as
applicable: (i) the Servicer 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 due to any act or failure to act of
the Servicer; (ii) the Servicer has not been terminated as servicer in a
residential mortgage loan securitization, either due to a servicing default
or to application of a servicing performance test or trigger; (iii) no
material noncompliance with the applicable servicing criteria with respect
to other securitizations of residential mortgage loans involving the
Servicer as servicer has been disclosed or reported by the Servicer; (iv)
no material changes to the Servicer's policies or procedures with respect
to the servicing function it will perform under this Agreement and any
Reconstitution Agreement for mortgage loans of a type similar to the
Mortgage Loans have occurred during the three-year period immediately
preceding the related Securitization Transaction; (v) there are no aspects
of the Servicer's financial
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condition that could have a material adverse effect on the performance by
the Servicer of its servicing obligations under this Agreement or any
Reconstitution Agreement; (vi) there are no material legal or governmental
proceedings pending (or known to be contemplated) against the Servicer or
any Subservicer; and (vii) there are no affiliations, relationships or
transactions relating to the Servicer or any Subservicer with respect to
any Securitization Transaction and any party thereto identified by the
related Depositor of a type described in Item 1119 of Regulation AB (other
than the affiliation between the Servicer and Washington Mutual Bank fsb
and Washington Mutual Mortgage Securities Corp.).
(b) If so requested by the Owner, the Master Servicer or any Depositor
on any date following the date on which information is first provided to
the Owner or such Depositor under Section 8.5, the Servicer shall, within
five Business Days following such request, confirm in writing the accuracy
of the representations and warranties set forth in Section 8.4(a) or, if
any such representation and warranty is not accurate as of the date of such
request, provide reasonably adequate disclosure of the pertinent facts, in
writing, to the requesting party.
SECTION 8.5 INFORMATION TO BE PROVIDED BY THE SERVICER
In connection with any Securitization Transaction that is a Permitted
Reconstitution, the Servicer shall (x) within five Business Days following
request by the Owner or any Depositor, provide to the Owner and such
Depositor (or, as applicable, cause each Subservicer to provide), in
writing and in form and substance reasonably satisfactory to the Owner and
such Depositor, the information and materials specified in Sections 8.5(a)
and (d), and (y) as promptly as practicable following notice to or
discovery by the Servicer, provide to the Owner and any Depositor (in
writing and in form and substance reasonably satisfactory to the Owner and
such Depositor) the information specified in Section 8.5(b).
(a) If so requested by the Owner or any Depositor, the Servicer shall
provide such information regarding the Servicer, as servicer of the
Mortgage Loans, and, as applicable, each Subservicer, as is requested for
the purpose of compliance with Item 1108 of Regulation AB. Such information
shall include, at a minimum:
(i) the Servicer's and each Subservicer's form of organization;
(ii) a description of any material legal or governmental
proceedings pending (or known to be contemplated) against the Servicer and
each Subservicer;
(iii) a description of any affiliation or relationship between
the Servicer and each Subservicer and any of the following parties to a
Securitization Transaction, as such parties are identified to the Servicer
by the Owner or any
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Depositor in writing not less than five (5) Business Days in advance of
such Securitization Transaction:
(A) the Sponsor;
(B) the Depositor;
(C) the Issuing Entity;
(D) any servicer;
(E) any trustee;
(F) any originator;
(G) any significant obligor;
(H) any enhancement or support provider; and
(I) any other material transaction party.
(iv) a description of how long the Servicer and each Subservicer
have been servicing residential mortgage loans; a general discussion of the
Servicer's and each Subservicer's experience in servicing assets of any
type as well as a more detailed discussion of the Servicer's and each
Subservicer's experience in, and procedures for, the servicing function it
will perform under this Agreement and any Reconstitution Agreement;
information regarding the size, composition and growth of the Servicer's
and each Subservicer's portfolio of residential mortgage loans of a type
similar to the Mortgage Loans and information on factors related to the
Servicer and each Subservicer that may be material, in the good faith
judgment of the Owner or any Depositor, to any analysis of the servicing of
the Mortgage Loans or the related asset-backed securities, as applicable,
including, without limitation:
(A) whether any prior securitizations of mortgage loans of a
type similar to the Mortgage Loans involving the Servicer or any
Subservicer have defaulted or experienced an early amortization or other
performance triggering event because of servicing during the three-year
period immediately preceding the related Securitization Transaction;
(B) the extent of outsourcing the Servicer and each
Subservicer utilizes;
(C) whether there has been previous disclosure of material
noncompliance with the applicable servicing criteria with respect to other
securitizations of residential mortgage loans involving the Servicer or any
Subservicer during the three-year period immediately preceding the related
Securitization Transaction;
(D) whether the Servicer or any Subservicer has been
terminated as servicer in a residential mortgage loan securitization,
either due to a servicing default or to application of a servicing
performance test or trigger; and
12
(E) such other information as the Owner or any Depositor may
reasonably request for the purpose of compliance with Item 1108(b)(2) of
Regulation AB;
(v) a description of any material changes during the three-year
period immediately preceding the related Securitization Transaction to the
Servicer's and each Subservicer's policies or procedures with respect to
the servicing function it will perform under this Agreement and any
Reconstitution Agreement for mortgage loans of a type similar to the
Mortgage Loans;
(vi) information regarding the Servicer's and each Subservicer's
financial condition, to the extent that there is a material risk that an
adverse financial event or circumstance involving the Servicer or
Subservicer could have a material adverse effect on the performance by the
Servicer or Subservicer of its servicing obligations under this Agreement
or any Reconstitution Agreement;
(vii) information regarding advances made by the Servicer and
each Subservicer on the Mortgage Loans and the Servicer's and Subservicer's
overall servicing portfolio of residential mortgage loans for the
three-year period immediately preceding the related Securitization
Transaction, which may be limited to a statement by an authorized officer
of the Servicer or Subservicer to the effect that the Servicer or
Subservicer has made all advances required to be made on residential
mortgage loans serviced by it during such period, or, if such statement
would not be accurate, information regarding the percentage and type of
advances not made as required, and the reasons for such failure to advance;
(viii) a description of the Servicer's and each Subservicer's
processes and procedures designed to address any special or unique factors
involved in servicing loans of a similar type as the Mortgage Loans;
(ix) a description of the Servicer's and each Subservicer's
processes for handling delinquencies, losses, bankruptcies and recoveries,
such as through liquidation of mortgaged properties, sale of defaulted
mortgage loans or workouts; and
(x) information as to how the Servicer and each Subservicer
defines or determines delinquencies and charge-offs, including the effect
of any grace period, re-aging, restructuring, partial payments considered
current or other practices with respect to delinquency and loss experience.
(b) For the purpose of satisfying the Purchaser's or any Depositor's
reporting obligation under the Exchange Act with respect to any class of
asset-backed securities, the Servicer shall (or shall cause each
Subservicer to) within five Business Days following such request (i) notify
the Owner, the Master Servicer and such Depositor in writing of (A) any
material litigation or governmental proceedings pending against the
Servicer or any Subservicer, (B) any affiliations or relationships that
develop following the closing date of a
13
Securitization Transaction between the Servicer or any Subservicer and any
of the parties specified in clause (iii) of Section 8.5(a) (and any other
parties identified in writing by the requesting party) with respect to such
Securitization Transaction, (C) the Servicer's failure be an approved
servicer of mortgage loans for Xxxxxx Xxx and Xxxxxxx Mac, in good standing
and (D) the Servicer's entry into an agreement with a Subservicer to
perform or assist in the performance of any of the Servicer's obligations
under the Agreement or any Reconstitution Agreement and (ii) provide to the
Owner and such Depositor a description of such proceedings, affiliations or
relationships.
(c) As a condition to the succession to the Servicer or any
Subservicer as servicer or subservicer under this Agreement or any
Reconstitution Agreement by any Person (i) into which the Servicer or such
Subservicer may be merged or consolidated, or (ii) which may be appointed
as a successor to the Servicer or any Subservicer, the Servicer shall
provide to the Owner, the Master Servicer and any Depositor, at least 15
calendar days prior to the effective date of such succession or
appointment, (x) written notice to the Owner and such Depositor of such
succession or appointment and (y) in writing and in form and substance
reasonably satisfactory to the Owner and such Depositor, all information
reasonably requested by the Owner or such Depositor in order to comply with
its reporting obligation under Item 6.02 of Form 8-K with respect to any
class of asset-backed securities.
(d) In addition to such information as the Servicer is obligated to
provide pursuant to other provisions of this Agreement:
(i) The Servicer or any Subservicer shall, to the extent the
Servicer or such Subservicer has knowledge thereof, provide to the party
responsible for filing distribution reports on Form 10-D in respect of any
Securitization Transaction that includes any of the Mortgage Loans serviced
by the Servicer or such Subservicer notice of the occurrence of any of the
following events along with all information as may be required to be
included in the related distribution report on Form 10-D (as specified in
the provisions of Regulation AB referred to below):
(A) any material modifications, extensions or waivers of
pool asset terms, fees, penalties or payments during the distribution
period or that have cumulatively become material over time (Item
1121(a)(11) of Regulation AB);
(B) material breaches of pool asset representations or
warranties or transaction covenants (Item 1121(a)(12) of Regulation AB);
and
(C) any repurchases of Mortgage Loans (Item 1121(a)(14) of
Regulation AB).
14
The foregoing information shall be provided in such form as may
be mutually agreed by the Servicer and the Master Servicer.
(ii) Upon request of the Depositor or Master Servicer, the
Servicer shall provide to the Purchaser, the Master Servicer and any
Depositor, (A) evidence of the authorization of the person signing any
certification or statement and (B) to supplement the publicly available
financial statements of the Servicer, such financial information and other
information related to the Servicer or any Subservicer or to the Servicer's
or such Subservicer's performance hereunder that can be provided without
violation of any applicable law and is reasonably available to the Servicer
without unreasonable effort or expense.
SECTION 8.6. SERVICER COMPLIANCE STATEMENT
On or before March 10 of each calendar year, commencing in 2007, the
Servicer shall deliver to the Owner, the Master Servicer and any Depositor
a statement of compliance addressed to the Owner, the Master Servicer and
such Depositor and signed by an authorized officer of the Servicer, to the
effect that (i) a review of the Servicer's activities during the
immediately preceding calendar year (or applicable portion thereof) and of
its performance under this Agreement and any applicable Reconstitution
Agreement during such period has been made under such officer's
supervision, and (ii) to the best of such officer's knowledge, based on
such review, the Servicer has fulfilled all of its obligations under this
Agreement and any applicable Reconstitution Agreement in all material
respects throughout such calendar year (or applicable portion thereof) or,
if there has been a failure to fulfill any such obligation in any material
respect, specifically identifying each such failure known to such officer
and the nature and the status thereof.
SECTION 8.7 REPORT ON ASSESSMENT OF COMPLIANCE AND ATTESTATION
(a) On or before March 10 of each calendar year, commencing in 2007,
the Servicer shall:
(i) deliver to the Owner, the Master Servicer and any Depositor a
report (in form and substance reasonably satisfactory to the Owner, the
Master Servicer and such Depositor) regarding the Servicer's assessment of
compliance with the 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 addressed to the
Owner, the Master Servicer and such Depositor and signed by an authorized
officer of the Servicer, and shall address each of the Servicing Criteria
specified on EXHIBIT H hereto;
(ii) deliver to the Owner, the Master Servicer and any Depositor
a report of a registered public accounting firm reasonably acceptable to
the Owner, the Master Servicer and such Depositor that attests to, and
reports on, the assessment of compliance made by the Servicer and delivered
pursuant to the
15
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;
(iii) cause each Subservicer and each Subcontractor determined by
the Servicer pursuant to Section 8.8(b) to be "participating in the
servicing function" within the meaning of Item 1122 of Regulation AB (each
such Subcontractor, a "Participating Entity"), to deliver to the Owner, the
Master Servicer and any Depositor an assessment of compliance and
accountants' attestation as and when provided in paragraphs (i) and (ii) of
this Section 8.7(a); and
(iv) deliver, and cause each Subservicer and each Participating
Entity to deliver, to the Purchaser, any Depositor, the Master Servicer and
any other Person that will be responsible for signing the certification (a
"Sarbanes Certification") required by Rules 13a-14(d) and 15d-14(d) under
the Exchange Act (pursuant to Section 302 of the Xxxxxxxx-Xxxxx Act of
2002) on behalf of an asset-backed issuer with respect to a Securitization
Transaction a certification, signed by the appropriate officer of such
Person, in the form attached hereto as EXHIBIT D.
The Servicer acknowledges that the parties identified in clause (iv) above
may rely on the certification provided by the Servicer pursuant to such
clause in signing a Sarbanes Certification and filing such with the
Commission. Neither the Owner nor any Depositor will require delivery of a
certification under clause (iv) above unless such Depositor is required
under the Exchange Act to file an annual report on Form 10-K with respect
to an issuing entity whose asset pool includes Mortgage Loans. Further, no
certification delivered under clause (iv) above shall be filed by the Owner
or such Depositor or any designee thereof as an exhibit to, or otherwise
included in, any filing with the Commission.
(b) Each assessment of compliance provided by a Subservicer pursuant
to Section 8.7(a)(iii) shall address each of the Servicing Criteria
specified on a certification substantially in the form of EXHIBIT H hereto
delivered to the Owner on or prior to the date on which such Subservicer is
appointed. An assessment of compliance provided by a Subcontractor pursuant
to Section 8.7(a)(iii) need not address any elements of the Servicing
Criteria other than those specified by the Servicer pursuant to Section
8.8(b).
SECTION 8.8 USE OF SUBSERVICERS AND SUBCONTRACTORS
The Servicer shall not hire or otherwise utilize the services of any
Subservicer to fulfill any of the obligations of the Servicer as servicer
under this Agreement or any Reconstitution Agreement unless the Servicer
complies with the provisions of paragraph (a) of this Section 8.8. The
Servicer shall not hire or otherwise utilize the services of any
Subcontractor, and shall not permit any Subservicer to hire or otherwise
utilize the services of any Subcontractor, to fulfill
16
any of the obligations of the Servicer as servicer under this Agreement or
any Reconstitution Agreement unless the Servicer complies with the
provisions of paragraph (b) of this Section 8.8.
(a) It shall not be necessary for the Servicer to seek the consent of
the Owner, the Master Servicer or any Depositor to the utilization of any
Subservicer. The Servicer shall cause any Subservicer used by the Servicer
(or by any Subservicer) for the benefit of the Owner and any Depositor to
comply with the provisions of this Section 8.8(a) and with Sections 8.4,
8.5(a), (c) and (d), 8.6, 8.7 and 8.9 of this Agreement to the same extent
as if such Subservicer were the Servicer, and to provide the information
required with respect to such Subservicer under Section 8.5(b) of this
Agreement. The Servicer shall be responsible for obtaining from each
Subservicer and delivering to the Owner and any Depositor any servicer
compliance statement required to be delivered by such Subservicer under
Section 8.6, any assessment of compliance and attestation required to be
delivered by such Subservicer under Section 8.7 and any certification
required to be delivered to the Person that will be responsible for signing
the Sarbanes Certification under Section 8.7 as and when required to be
delivered.
(b) It shall not be necessary for the Servicer to seek the consent of
the Owner, the Master Servicer or any Depositor to the utilization of any
Subcontractor. The Servicer shall promptly upon request provide to the
Owner, the Master Servicer and any Depositor (or any designee of such
Depositor, such as an administrator) a written description (in form and
substance satisfactory to the Owner, the Master Servicer and such
Depositor) of the role and function of each Subcontractor utilized by the
Servicer or any Subservicer, specifying (i) the identity of each such
Subcontractor, (ii) which (if any) of such Subcontractors are Participating
Entities, and (iii) which elements of the Servicing Criteria will be
addressed in assessments of compliance provided by each Subcontractor
identified pursuant to clause (ii) of this paragraph.
As a condition to the utilization of any Subcontractor determined to
be "participating in the servicing function" within the meaning of Item
1122 of Regulation AB, the Servicer shall cause any such Subcontractor used
by the Servicer (or by any Subservicer) for the benefit of the Owner and
any Depositor to comply with the provisions of Sections 8.7 and 8.9 of this
Agreement to the same extent as if such Subcontractor were the Servicer.
The Servicer shall be responsible for obtaining from each Subcontractor and
delivering to the Owner and any Depositor any assessment of compliance and
attestation and the other certifications required to be delivered by such
Subcontractor under Section 8.7, in each case as and when required to be
delivered.
SECTION 8.9 INDEMNIFICATION; REMEDIES
(a) With respect to any Securitization Transaction for which Servicer
Information is included in a related Disclosure Document, the Servicer, on
the one hand, and the Owner and the Depositor, on the other hand, shall
execute and
17
deliver an Indemnification Agreement in substantially the form attached as
EXHIBIT I hereto, pursuant to which each such party shall indemnify the
other party or parties and each Person who controls any of such parties
(within the meaning of Section 15 of the Securities Act) for the matters
set forth in such Indemnification Agreement.
(b) The Servicer shall indemnify and hold harmless each of the Owner,
the Master Servicer, each Person, if any, who "controls" the Owner or the
Master Servicer within the meaning of the Securities Act of 1933, as
amended, and their respective officers, directors and employees
(collectively, the "Indemnitees") against any and all losses, penalties,
fines, forfeitures, legal fees and related costs, judgments and any other
costs, fees and expenses that such Indemnitee may sustain in direct
connection with, or arising out of, third party claims based on, (i) the
failure of the Servicer to deliver or cause to be delivered when required
any information, report, certification, accountants' letter or other
material when and as required pursuant to Section 8.5(b), (c) or (d),
Section 8.6 or Section 8.7 or any failure by the Servicer to identify
pursuant to Section 8.8(b) any Subcontractor "participating in the
servicing function" within the meaning of Item 1122 of Regulation AB, (ii)
any material misstatement or omission in any Sarbanes Certification made in
reliance on any material misstatement or omission contained in any
officer's certificate provided pursuant to Section 8.6 or Section
8.7(a)(iv), (iii) any material misstatement or omission contained in the
assessment of compliance delivered in accordance with Section 8.7(a)(i),
(iv) any material misstatement or omission contained in any information
provided by the Servicer, any Subservicer or any Subcontractor pursuant to
Section 8.4(b) or Section 8.5(b) or (d) or (v) any breach by the Servicer
of a representation or warranty set forth in Section 8.4(a) and made as of
a date prior to the Closing Date of the related Securitization Transaction,
to the extent that such breach is not cured by such Closing Date. If the
indemnification provided for herein is unavailable or insufficient to hold
harmless any Indemnitee, then the Servicer agrees that it shall contribute
to the amount paid or payable by the Indemnitee as a result of the losses,
claims, damages or liabilities of the Indemnitee arising out of clauses
(i), (ii) or (iii) of the preceding sentence in such proportion as is
appropriate to reflect the relative fault of the Indemnitee on the one hand
and the Servicer on the other.
For purposes of this Section 8.9(b), "third party claims" shall
include claims brought against an Indemnitee by any agent or affiliate of
such Indemnitee where such claims arise out of, or are based on, (A) the
failure of the Servicer to deliver or cause to be delivered when required
any information, report, certification, accountants' letter or other
material when and as required pursuant to Section 8.6 or Section 8.7 or any
failure by the Servicer to identify pursuant to Section 8.8(b) any
Subcontractor "participating in the servicing function" within the meaning
of Item 1122 of Regulation AB, (B) any material misstatement or omission in
any Sarbanes Certification made in reliance on any material misstatement or
omission contained in any officer's certificate provided pursuant
18
to Section 8.6 or Section 8.7(a)(iv), (C) any material misstatement or
omission contained in the assessment of compliance delivered in accordance
with Section 8.7(a)(i) or (D) any material misstatement or omission
contained in any information provided by the Servicer, any Subservicer or
any Subcontractor pursuant to Section 8.4(b) or Section 8.5(b) or (d).
If the indemnification provided for herein is unavailable or
insufficient to hold harmless an Indemnified Party, then the Servicer
agrees that it shall contribute to the amount paid or payable by such
Indemnified Party as a result of any claims, losses, damages or liabilities
incurred by such Indemnified Party in such proportion as is appropriate to
reflect the relative fault of such Indemnified Party on the one hand and
the Servicer on the other.
In the case of any failure of performance described in clause (i) of
this Section 8.9(b), the Servicer shall promptly reimburse the Owner, any
Depositor, as applicable, and each Person responsible for the preparation,
execution or filing of any report required to be filed with the Commission
with respect to such Securitization Transaction, or for execution of a
certification pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the
Exchange Act with respect to such Securitization Transaction, for all costs
reasonably incurred by each such party in order to obtain the information,
report, certification, accountants' letter or other material not delivered
as required by the Servicer, any Subservicer or any Subcontractor.
This indemnification shall survive the termination of this Agreement
or the termination of any party to this Agreement.
(c) The Owner shall indemnify and hold harmless the Servicer and, if
applicable, any Subservicer or Participating Entity, and each Person who
controls any of such parties (within the meaning of Section 20 of the
Exchange Act), 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 any untrue statement or
alleged untrue statement of any material fact contained in any filing with
the Commission under the Exchange Act or the omission or alleged omission
to state in any filing with the Commission under the Exchange Act a
material fact required to be stated or necessary to be stated in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading, in each case, except to the extent, that
such untrue statement, alleged untrue statement, omission, or alleged
omission relates to any information provided or required to be provided by
the Servicer or any Subservicer or Participating Entity (i) pursuant to
Sections 8.4(b), 8.5(b), 8.5(c), 8.5(d), 8.6, 8.7(a)(i) or 8.7(a)(iv) or
(ii) in any servicing report under this Agreement.
This indemnification shall survive the termination of this Agreement
or the termination of any party to this Agreement.
19
(d) Notwithstanding anything in this Section 8.9 to the contrary, in
no event shall the Servicer have any liability for any indirect, special,
consequential or punitive damages, losses, costs or expenses incurred by
the Owner or any other party entitled to indemnification or other remedies
hereunder.
SECTION 8.10 THIRD PARTY BENEFICIARY
For purposes of Sections 8.3, 8.4(b), 8.5(b), (c) and (d), 8.6, 8.7,
8.8 and 8.9 and any related provisions, the Master Servicer shall be
considered a third-party beneficiary of this Agreement, entitled to all the
rights and benefits of the foregoing provisions as if it were a direct
party to this Agreement.
(h) The Original Servicing Agreement is amended by substituting EXHIBIT D
attached hereto for Exhibit D to the Original Servicing Agreement.
(i) The Original Servicing Agreement is amended by adding the following
exhibits:
EXHIBIT H Servicing Criteria
EXHIBIT I Form of Indemnification Agreement
ARTICLE II
MISCELLANEOUS
SECTION 2.1 CONDITIONS TO EFFECTIVENESS
This Amendment shall be effective upon the execution and delivery by both
parties of this Amendment.
SECTION 2.2 REFERENCE TO AND EFFECT ON THE PURCHASE AGREEMENT AND THE
SERVICING AGREEMENT
Each reference in the Servicing Agreement to "this Agreement" or otherwise
to the Servicing Agreement shall hereafter be deemed to refer to the Servicing
Agreement as amended hereby. Each reference to the Servicing Agreement in the
Purchase Agreement or in any other document or agreement executed in connection
therewith or with the Servicing Agreement shall hereafter be deemed to refer to
the Servicing Agreement as amended hereby.
SECTION 2.3 RATIFICATION
The Servicing Agreement, as amended by this Amendment, is hereby ratified
and confirmed and shall continue unimpaired and in full force and effect in
accordance with the provisions thereof, as amended or modified on or prior to
the date hereof and as hereby amended.
SECTION 2.4 APPLICABLE LAW
20
This Amendment shall be governed by and construed in accordance with the
laws of the State of New York (including Section 5-1401 of the New York General
Obligations Law) and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws without giving effect
to conflict of laws principles other than Section 5-1401 of the New York General
Obligations Law.
SECTION 2.5 SEVERABILITY
Any provision of this Amendment which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions of this Amendment and without affecting the validity or
enforceability of such or any other provision in any other jurisdiction.
SECTION 2.6 COUNTERPARTS
This Amendment may be executed simultaneously in counterparts, each of
which shall be deemed an original, and it shall not be necessary in making proof
of this Amendment to produce or account for more than one such counterpart for
each party hereto.
[Signature page follows]
21
The Servicer and the Owner have caused this Regulation AB Amendment to
Servicing Agreement to be executed as of the date set forth above.
SERVICER:
WASHINGTON MUTUAL BANK
a federally chartered savings bank
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
OWNER:
XXXXXXX XXXXX MORTGAGE LENDING, INC.
a Delaware corporation
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
22
EXHIBIT D
FORM OF ANNUAL CERTIFICATION
Re: The [___________] agreement dated as of [_______], 200[_] (the
"Agreement"), among [IDENTIFY PARTIES]
I, ________________________________, the _____________________ of Washington
Mutual Bank (the "Servicer"), certify to [the Owner], [the Depositor], and the
[Master Servicer] [Securities Administrator] [Trustee], and their officers, with
the knowledge and intent that they will rely upon this certification, that:
(1) I have reviewed the servicer compliance statement of the Servicer
provided in accordance with Item 1123 of Regulation AB (the "Compliance
Statement"); the report on assessment of the Servicer's compliance with the
servicing criteria set forth in Item 1122(d) of Regulation AB (the
"Servicing Criteria"), provided in accordance with Rules 13a-18 and 15d-18
under Securities Exchange Act of 1934, as amended (the "Exchange Act") and
Item 1122 of Regulation AB (the "Servicing Assessment"); the registered
public accounting firm's attestation report provided in accordance with
Rules 13a-18 and 15d-18 under the Exchange Act and Section 1122(b) of
Regulation AB (the "Attestation Report"); and all servicing reports,
officer's certificates and other information relating to the servicing of
the Mortgage Loans by the Servicer during 200[ ] that were delivered by the
Servicer to the [Depositor] [Master Servicer] [Securities Administrator]
[Trustee] pursuant to the Agreement (collectively, the "Servicing
Information");
(2) Based on my knowledge, the Servicing Information, taken as a
whole, does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in the light
of the circumstances under which such statements were made, not misleading
with respect to the period of time covered by the Servicing Information;
(3) Based on my knowledge, all of the Servicing Information required
to be provided by the Servicer under the Agreement has been provided to the
[Depositor] [Master Servicer] [Securities Administrator] [Trustee];
(4) I am responsible for reviewing the activities performed by the
Servicer as servicer under the Agreement, and based on my knowledge and the
compliance review conducted in preparing the Compliance Statement and
except as disclosed in the Compliance Statement, the Servicing Assessment
or the Attestation Report, the Servicer has fulfilled its obligations under
the Agreement; and
(5) The Compliance Statement required to be delivered by the Servicer
pursuant to the Agreement, and the Servicing Assessment and Attestation
Report required to be provided by the Servicer and by each Participating
Entity pursuant to the Agreement, have been provided to the [Depositor]
[Master Servicer]. Any material instances of noncompliance described in
such reports have been disclosed to the
23
[Depositor] [Master Servicer]. Any material instance of noncompliance with
the Servicing Criteria has been disclosed in such reports.
Date:
----------------------------------
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
24
EXHIBIT H
SERVICING CRITERIA
The assessment of compliance to be delivered by [the Servicer] [Name of
Subservicer] shall address the criteria identified as below as "Applicable
Servicing Criteria":
SERVICING CRITERIA APPLICABLE
------------------------------------------------------------------- SERVICING
REFERENCE CRITERIA CRITERIA
------------------ ---------------------------------------------- ----------
GENERAL SERVICING CONSIDERATIONS
1122(d)(1)(i) Policies and procedures are instituted to X
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 X
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
mortgage loans are maintained.
1122(d)(1)(iv) A fidelity bond and errors and omissions X
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 mortgage loans are deposited into X
the appropriate custodial bank accounts and
related bank clearing accounts no more than
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
of an obligor or to an investor are made only
by authorized personnel.
1122(d)(2)(iii) Advances of funds or guarantees regarding X
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.
1122(d)(2)(iv) The related accounts for the transaction, such X
as cash reserve accounts or accounts
established as a form of
overcollateralization, are separately
maintained (e.g., with respect to commingling
of cash) as set forth in the transaction
agreements.
H-1
SERVICING CRITERIA APPLICABLE
------------------------------------------------------------------- SERVICING
REFERENCE CRITERIA CRITERIA
------------------ ---------------------------------------------- ----------
1122(d)(2)(v) Each custodial account is maintained at a X
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 X
prevent unauthorized access.
1122(d)(2)(vii) Reconciliations are prepared on a monthly X
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.
INVESTOR REMITTANCES AND REPORTING
1122(d)(3)(i) Reports to investors, including those to be X
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 mortgage loans 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.
1122(d)(3)(iii) Disbursements made to an investor are posted X
within two business days to the Servicer's
investor records, or such other number of days
specified in the transaction agreements.
1122(d)(3)(iv) Amounts remitted to investors per the investor X
reports agree with cancelled checks, or other
form of payment, or custodial bank statements.
H-2
SERVICING CRITERIA APPLICABLE
------------------------------------------------------------------- SERVICING
REFERENCE CRITERIA CRITERIA
------------------ ---------------------------------------------- ----------
POOL ASSET ADMINISTRATION
1122(d)(4)(i) Collateral or security on mortgage loans is X
maintained as required by the transaction
agreements or related mortgage loan documents.
1122(d)(4)(ii) Mortgage loan and related documents are X
safeguarded as required by the transaction
agreements
1122(d)(4)(iii) Any additions, removals or substitutions to X
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 mortgage loans, including any X
payoffs, made in accordance with the related
mortgage loan 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
mortgage loan documents.
1122(d)(4)(v) The Servicer's records regarding the mortgage X
loans 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 X
an obligor's mortgage loans (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., X
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)(viii) Records documenting collection efforts are X
maintained during the period a mortgage loan
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 mortgage
loans including, for example, phone calls,
letters and payment rescheduling plans in
cases where delinquency is deemed temporary
(e.g., illness or unemployment).
H-3
SERVICING CRITERIA APPLICABLE
------------------------------------------------------------------- SERVICING
REFERENCE CRITERIA CRITERIA
------------------ ---------------------------------------------- ----------
1122(d)(4)(ix) Adjustments to interest rates or rates of X
return for mortgage loans with variable rates
are computed based on the related mortgage
loan documents.
1122(d)(4)(x) Regarding any funds held in trust for an X
obligor (such as escrow accounts): (A) such
funds are analyzed, in accordance with the
obligor's mortgage loan 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
mortgage loan documents and state laws; and
(C) such funds are returned to the obligor
within 30 calendar days of full repayment of
the related mortgage loans, or such other
number of days specified in the transaction
agreements.
1122(d)(4)(xi) Payments made on behalf of an obligor (such as X
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 X
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.
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are X
posted within two business days to the
obligor's records maintained by the servicer,
or such other number of days specified in the
transaction agreements.
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible X
accounts are recognized and recorded in
accordance with the transaction agreements.
1122(d)(4)(xv) Any external enhancement or other support,
identified in Item 1114(a)(1) through (3) or
Item 1115 of Regulation AB, is maintained as
set forth in the transaction agreements.
H-4
[WASHINGTON MUTUAL BANK]
----------------------------------------
[NAME OF SUBSERVICER]
Date:
----------------------------------
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
H-5
EXHIBIT I
FORM OF INDEMNIFICATION AGREEMENT
__________, 200__
[Depositor]
[Owner]
Re: [Issuer Name], [Title of Securities], Series [____-____], Class [___]
Ladies and Gentlemen:
Reference is hereby made to the [Offering Document] (the "Offering Materials"),
dated as of ________, 200_ relating to _____________, Series ____________ (the
"Securities").
[Each of] Washington Mutual Bank [and Washington Mutual Bank fsb] (each, a
"Seller" and together, the "Sellers"), severally and not jointly, agrees, upon
the terms and subject to the conditions provided herein, to indemnify and hold
harmless (i) [Depositor] (the "Depositor"), (ii) [Owner] (the "Owner"), and
(iii) each person, if any, who controls the Depositor or the Owner within the
meaning of Section 15 of the Securities Act of 1933 (the "1933 Act") or Section
20 of the Securities Exchange Act of 1934 (the "Exchange Act") ((i) through
(iii) collectively, the "Depositor indemnified party") against any losses,
claims, damages, liabilities or expenses (including, but not limited to,
reasonable attorneys' fees and any and all expenses incurred in investigating,
preparing and defending against any claims therefore, and any amounts paid in
settlement of any claim or litigation, except as otherwise provided herein), to
which such Depositor indemnified party may become subject, under the 1933 Act or
otherwise, insofar as such losses, claims, damages, liabilities and expenses
arise out of or are based upon (a) any untrue statement of alleged untrue
statement of a material fact contained in the information with respect to such
Seller attached hereto as EXHIBIT A (the "Seller Information") or (b) the
omission or alleged omission to state in the Seller Information a material fact
required to be stated therein or necessary to make the statements in the Seller
Information, in the light of the circumstances under which they were made, not
misleading (as of the date thereof), in each case to the extent and only to the
extent that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in strict conformity with the
Seller Information furnished by such Seller specifically for use in the Offering
Materials as attached hereto as EXHIBIT A. Each Seller's liability under this
letter agreement shall be in addition to any other liability such Seller may
otherwise have.
Washington Mutual Bank (the "Servicer') agrees, upon the terms and subject to
the conditions provided herein, to indemnify and hold harmless each Depositor
indemnified party against any losses, claims, damages, liabilities or expenses
(including, but not limited to, reasonable attorneys' fees and any and all
expenses incurred in investigating, preparing and defending against any claims
therefore, and any amounts paid in settlement of any claim or litigation, except
as otherwise provided herein), to which such Depositor indemnified party may
become subject, under the 1933 Act or otherwise, insofar as such losses, claims,
damages, liabilities and
I-1
expenses, arise out of or are based upon (a) any untrue statement or alleged
untrue statement of a material fact contained in the information with respect to
the Servicer attached hereto as EXHIBIT B (the "Servicer Information") or (b)
the omission or alleged omission to the state in the Servicer Information a
material fact required to be stated therein or necessary to make the statements
in the Servicer Information, in the light of the circumstances under which they
were made, not misleading (as of the date thereof), in each case to the extent
and only to the extent that such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in strict conformity
with the Servicer Information furnished by the Servicer specifically for use in
the Offering Materials as attached hereto as EXHIBIT B. The Servicer's liability
under this letter agreement shall be in addition to any other liability the
Servicer may otherwise have.
Each Owner and Depositor, jointly and severally, agree, upon the terms and
subject to the conditions provided herein, to indemnify and hold harmless (i)
each Seller, (ii) the Servicer and (iii) each person, if any, who controls such
Seller or Servicer within the meaning of Section 15 of the 1933 Act or Section
20 of the Exchange Act ((i) through (iii) collectively, the "Seller indemnified
party") against any losses, claims, damages, liabilities or expenses (including,
but not limited to, reasonable attorneys' fees and any and all expenses incurred
in investigating, preparing and defending against any claims therefore, and any
amounts paid in settlement of any claim or litigation, except as otherwise
provided herein), to which such Seller indemnified party may become subject,
under the 1933 Act or otherwise, insofar as such losses, claims, damages,
liabilities and expenses, arise out of or are based upon (a) any untrue
statement or alleged untrue statement of a material fact contained in the
Offering Materials or (b) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (as of the date thereof), except to the extent that such untrue
statement or alleged untrue statement or omission or alleged omission relates to
the Seller Information or the Servicer Information. Each Owner's or Depositor's
liability under this letter agreement shall be in addition to any other
liability such Owner or Depositor may otherwise have.
With respect to each claim for indemnification made hereunder, the indemnified
party shall notify the indemnifying party in writing, giving notice of the
nature of the claim, promptly after receipt of a service of a summons or other
first legal process that shall have been served upon such indemnified party, but
failure to notify the indemnifying party of any such claim shall not relieve the
indemnifying party from any liability which it may have to the indemnified party
on account of the indemnity contained in this letter agreement, except to the
extent that the indemnifying party has been materially prejudiced by such
failure.
The indemnifying party will be entitled to participate at its own expense in the
defense or, if the indemnifying party so elects, to assume the defense of any
suit brought to enforce any such liability (jointly with any other indemnifying
party similarly notified), but if the indemnifying party elects to assume the
defense, such defense shall be conducted by counsel reasonably satisfactory to
the indemnified party. After notice from the indemnifying party to such
indemnified party of its election to so assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under this
letter agreement for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. In the event the indemnifying party elects to assume the
I-2
defense of any such suit and retain such counsel, the indemnified party or
persons, defendant or defendants in the suit, may retain additional counsel but
shall bear the fees and expenses of such counsel unless: (i) the indemnifying
party shall have agreed to the retention of such counsel at the expense of the
indemnifying party; or (ii) the named parties to any such proceeding (including
any impleaded parties) include both the indemnifying party and the indemnified
party, and representation of both by the same counsel would be inappropriate due
to actual or potential differing interests between them. In no event shall the
indemnifying party be liable, in connection with any proceeding or separate but
similar proceedings in the same jurisdiction arising out of the same general
allegations or circumstances, for the fees and expenses of more than one counsel
(separate from its own counsel) for the indemnified party.
The indemnifying party shall not be liable to indemnify any person for any
settlement of any claim effected without the indemnifying party's written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment. If the indemnifying party assumes the defense of any proceeding, the
indemnifying party shall not, without the prior written consent of an
indemnified party, which consent will not be unreasonably withheld, effect any
settlement of any pending or threatened proceeding in respect of which such
indemnified party is or could have been a party and indemnity is or could have
been sought hereunder by such indemnified party unless such settlement (i)
includes an unconditional release of such indemnified party from all liability
on any claims that are the subject of such action and (ii) does not include a
statement as to, or an admission of, fault, culpability or failure to act by or
on behalf of an indemnified party.
If the indemnification provided for in this letter agreement is determined to be
insufficient or unavailable to an indemnified party in respect of any
liabilities referred to herein (on the grounds of public policy or otherwise),
then the indemnifying party, in lieu of indemnifying the indemnified party,
shall contribute to the liabilities and expenses incurred by the indemnified
party in such proportion as is appropriate equally to reflect (i) the relative
fault and benefits of (a) the indemnifying party on the one hand and (b) the
indemnified party on the other hand, in connection with the statements or
omissions which resulted in such liabilities (or actions in respect thereof) as
well as (ii) any other relevant equitable considerations. The relative fault of
each indemnifying party, on the one hand, and of each indemnified party, on the
other, shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of material fact or the omission or alleged
omission to state a material fact relates to information supplied by, or action
within the control of such indemnifying party or such indemnified party and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The indemnifying party and the
indemnified party agree that it would not be just and equitable if contribution
were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to above.
No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 0000 Xxx) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
I-3
Upon the incurrence of any losses, claims, damages or other liabilities for
which a person is entitled to contribution hereunder, the contributor shall
reimburse such person entitled to contribution promptly upon establishment by
the person entitled to contribution to the contributor of the losses, claims,
damages or other liabilities incurred.
Notwithstanding anything to the contrary contained in this letter agreement, in
no event shall any Seller or the Servicer have any liability for any indirect,
special, punitive or consequential damages, losses, costs or expenses incurred
by any Depositor indemnified party or any other party entitled to
indemnification or other remedies hereunder.
All demands, notices and other communications to be given hereunder shall be in
writing (except as otherwise specifically provided herein) and shall be mailed
by registered mail or personally delivered and telecopied to the recipient as
follows:
(a) To the Seller(s):
Washington Mutual Bank
[Washington Mutual Bank fsb]
0000 Xxxxx Xxxxxx, XXX 0000X
Xxxxxxx, XX 00000
Attention: General Counsel
Facsimile:
(b) To the Servicer:
Washington Mutual Bank
0000 Xxxxx Xxxxxx, XXX 0000X
Xxxxxxx, XX 00000
Attention: General Counsel
Facsimile:
(c) To the Owner:
-----------------------------
-----------------------------
-----------------------------
-----------------------------
Attention:
Facsimile:
(d) To the Depositor:
-----------------------------
-----------------------------
-----------------------------
-----------------------------
Attention:
Facsimile:
I-4
A party may specify an additional or different address or addresses by writing
mailed or delivered to the other parties as aforesaid. All such notices and
other communications shall be effective upon receipt.
This letter agreement shall be governed by and construed in accordance with the
laws of the State of New York (without giving effect to the conflict of laws
provisions thereof, other than Sections 5-1401 and 5-1402 of the New York
General Obligations Law). This letter agreement may not be assigned by any part)
without the express written consent of each other party. Any assignment made in
violation of this letter agreement shall be null and void. Amendments of this
letter agreement shall be in writing signed by each party hereto. The indemnity
and contribution agreements contained in this letter agreement shall remain
operative and in full force and effect, regardless of (i) any investigation made
by or on behalf of any indemnified party, (ii) the issuance of the Securities or
(iii) any termination of this letter agreement. The parties to this letter
agreement may execute this letter agreement in counterparts, and all such
counterparts shall constitute one and the same instrument. In the event that any
provision of this letter agreement shall be held invalid or unenforceable by any
court of competent jurisdiction, the parties hereto agree that such holding
shall not invalidate or render unenforceable any other provision hereof. The
parties hereto further agree that the holding by any court of competent
jurisdiction that any remedy pursued by any party hereto is unavailable or
unenforceable shall not affect in any way the ability of such party to pursue
any other remedy available to it.
No recourse under this letter agreement shall be had against, and no personal
liability shall attach to, any officer, employee, director, affiliate or
shareholder of any party hereto, as such, by the enforcement of any assessment
or by any legal or equitable proceeding, by virtue of any statute or otherwise
in respect hereof it being expressly agreed and understood that this letter
agreement is solely a corporate obligation of each party hereto, and that any
and all personal liability, either at common law or in equity, or by statute or
constitution, of every such officer, employee, director, affiliate or
shareholder for breaches of any party hereto of any obligations hereunder is
hereby expressly waived as a condition of and in consideration for the execution
and delivery of this letter agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
I-5
Please signify your acceptance of this letter agreement by signing below and
returning to the undersigned. This letter agreement shall be effective as of the
date first stated above upon delivery of written acceptance by all parties
hereto.
Very truly yours,
WASHINGTON MUTUAL BANK
a federally chartered savings bank
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
[WASHINGTON MUTUAL BANK fsb
a federally chartered savings bank
By:
---------------------------------
Name:
-------------------------------
Title: ]
-----------------------------
Agreed and Accepted,
[OWNER]
a
-----------------------------------
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
[DEPOSITOR]
a
-----------------------------------
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
I-6
Exhibit A
SELLER INFORMATION
Exhibit A-1
Exhibit B
SERVICER INFORMATION
Exhibit B-1
