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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported) March 2, 1998
DLJ Commercial Mortgage Corp.
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(Exact Name of Registrant as Specified in Its Charter)
Delaware 333-32019 13-3956945
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
277 Park Avenue, New York, New York 10172
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (212) 892-3000
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(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events.
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On March 2, 1998, a single series of certificates, entitled DLJ
Commercial Mortgage Corp., Commercial Mortgage Pass-Through Certificates, Series
1998-CF1 (the "Certificates"), was issued pursuant to a pooling and servicing
agreement (the "Pooling and Servicing Agreement"), entered into by and among DLJ
Commercial Mortgage Corp. (the "Registrant") as depositor, Banc One Mortgage
Capital Markets, LLC, as servicer, Clarion Partners, LLC, as special servicer,
and Norwest Bank Minnesota, National Association, as trustee and REMIC
administrator. The Pooling and Servicing Agreement is attached hereto as Exhibit
4.1. Certain classes of the Certificates, designated Class CP, Class S, Class
A-1A, Class A-1B, Class A-2, Class A-3, Class B-1 and Class B-2 (collectively,
the "Underwritten Certificates"), are being registered under the Registrant's
registration statement on Form S-3 (no. 333-32019) and have been sold to
Donaldson, Lufkin & Jenrette Securities Corporation (the "Underwriter") pursuant
to an underwriting agreement (the "Underwriting Agreement") entered into by and
between the Registrant and the Underwriter. The Underwriting Agreement is
attached hereto as Exhibit 1.1.
Item 7. Financial Statements and Exhibits.
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(a) Financial statements of businesses acquired:
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Not applicable.
(b) Pro forma financial information:
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Not applicable.
(c) Exhibits:
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Exhibit No. Description
1.1 Underwriting Agreement, dated as of February 20, 1998, between
DLJ Commercial Mortgage Corp., as seller, and Donaldson, Lufkin &
Jenrette Securities Corporation, as underwriter.
4.1 Pooling and Servicing Agreement, dated as of March 1, 1998, among
DLJ Commercial Mortgage Corp., as depositor, Banc One Capital
Markets, LLC, as servicer, Clarion Partners, LLC, as special
servicer, and Norwest Bank Minnesota, National Association, as
trustee and REMIC administrator.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: March 16, 1998
DLJ COMMERCIAL MORTGAGE CORP.
By: /s/ N. Dante LaRocca
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Name: N. Dante LaRocca
Title: Senior Vice President
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EXHIBIT INDEX
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The following exhibits are filed herewith:
Exhibit No. Page No.
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1.1 Underwriting Agreement, dated as of February 20,
1998, between DLJ Commercial Mortgage Corp., as
seller, and Donaldson, Lufkin & Jenrette
Securities Corporation, as underwriter.
4.1 Pooling and Servicing Agreement, dated as of
March 1, 1998, among DLJ Commercial Mortgage
Corp., as depositor, Banc One Capital Markets,
LLC, as servicer, Clarion Partners, LLC, as
special servicer, and Norwest Bank Minnesota,
National Association, as trustee and REMIC
administrator.
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DLJ COMMERCIAL MORTGAGE CORP.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
UNDERWRITING AGREEMENT
As of February 20, 1998
Donaldson, Lufkin & Jenrette
Securities Corporation
277 Park Avenue
New York, NY 10172
Ladies and Gentlemen:
DLJ Commercial Mortgage Corp., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to sell to the
underwriters named in Schedule I hereto (the "Underwriters"; provided, however,
that if you are the only underwriter named in Schedule I, then the terms
"Underwriter" and "Underwriters" shall refer solely to you) those classes (each,
a "Class") of its Commercial Mortgage Pass-Through Certificates, Series
1998-CF1, specified in Schedule II hereto (the "Offered Certificates"). The
Offered Certificates will be issued pursuant to a Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement") to be dated as of March 1,
1998 (the "Cut-off Date"), among the Company, as depositor, BancOne Mortgage
Capital Markets, LLC, as servicer (the "Servicer"), Clarion Partners, LLC, as
special servicer (the "Special Servicer"), and Norwest Bank Minnesota, National
Association, as trustee (in such capacity, the "Trustee") and as REMIC
administrator (in such capacity, the "REMIC Administrator"). The Offered
Certificates will evidence undivided interests in a trust fund (the "Trust
Fund") to be established by the Company pursuant to the Pooling and Servicing
Agreement. The Trust Fund will consist primarily of a pool (the "Mortgage Pool")
of conventional, monthly pay, commercial and multifamily mortgage loans (the
"Mortgage Loans") transferred by the Company to the Trust Fund and listed in an
attachment to the Pooling and Servicing Agreement. Three real estate mortgage
investment conduit ("REMIC") elections are to be made with respect to the Trust
Fund with the resulting REMICs being referred to as "REMIC I", "REMIC II" and
"REMIC III", respectively. The Class B-3, Class B-4, Class B-5, Class B-6, Class
B-7, Class C, Class R-I, Class R-II and Class R-III Certificates (collectively
with the Offered Certificates, the "Certificates") are also to be issued
pursuant to the Pooling and Servicing Agreement but do not form a part of this
offering. The Offered Certificates are described more fully in the Basic
Prospectus and the Prospectus Supplement (each of which terms is defined below)
which the Company is furnishing to you.
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1. Representations and Warranties. The Company represents and warrants to,
and agrees with, each Underwriter that:
(a) The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement (No. 333-32019) on Form S-3 for the
registration under the Securities Act of 1933, as amended (the "Act"), of the
Offered Certificates, which registration statement has become effective and
copies of which have heretofore been delivered to you. Such registration
statement meets the requirements set forth in Rule 415(a)(1) under the Act and
complies in all other material respects with such Rule. The Company proposes to
file with the Commission pursuant to Rule 424 under the Act a supplement, dated
the date specified in Schedule II hereto, to the prospectus, dated the date
specified in Schedule II hereto, relating to the Offered Certificates and the
method of distribution thereof and has previously advised you of all further
information (financial and other) with respect to the Offered Certificates set
forth therein. Such registration statement, including the exhibits thereto, as
amended at the date hereof is hereinafter called the "Registration Statement";
such prospectus, in the form in which it will be filed with the Commission
pursuant to Rule 424 under the Act, is hereinafter called the "Basic
Prospectus"; such supplement to the Basic Prospectus, in the form in which it
will be filed with the Commission pursuant to Rule 424 of the Act, is
hereinafter called the "Prospectus Supplement"; and the Basic Prospectus and the
Prospectus Supplement together are hereinafter called the "Prospectus". Any
preliminary form of the Prospectus Supplement which has heretofore been filed
pursuant to Rule 402(a) or Rule 424 is hereinafter called a "Preliminary
Prospectus Supplement". The Company will not, without your prior consent, file
any other amendment to the Registration Statement or make any change in the
Basic Prospectus or the Prospectus Supplement until after the end of the period
during which a prospectus is required to be delivered to purchasers of the
Offered Certificates under the Act. The Company, as depositor with respect to
the Trust Fund, will file with the Commission within fifteen days of the
issuance of the Offered Certificates a report on Form 8-K setting forth specific
information concerning the Offered Certificates (the "Form 8-K").
(b) As of the date hereof, when the Registration Statement became
effective, when the Prospectus Supplement is first filed pursuant to Rule 424
under the Act, when, prior to the Closing Date, any other amendment to the
Registration Statement becomes effective, when any supplement to the Prospectus
Supplement is filed with the Commission, and at the Closing Date, (i) the
Registration Statement, as amended as of any such time, and the Prospectus, as
amended or supplemented as of any such time, complied or will comply in all
material respects with the applicable requirements of the Act and the rules
thereunder, (ii) the Registration Statement, as amended as of any such time, did
not and will not contain any untrue statement of a material fact and did not and
will not omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) the
Prospectus, as amended or supplemented as of any such time, did not and will not
contain an untrue statement of a material fact and did not and will not omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided,
however, that the Company makes no representations or warranties as to (A) the
information contained in or omitted from the Registration Statement or the
Prospectus or any amendment thereof or supplement thereto in reliance
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upon and in conformity with written information furnished to the Company by you,
or by any Underwriter through you, specifically for use in the preparation
thereof, or (B) the information contained in or omitted from any Current Report
(as defined in Section 5(b) hereof), or any amendment thereof or supplement
thereto, incorporated by reference in the Registration Statement or the
Prospectus (or any amendment thereof or supplement thereto).
(c) The Company is a corporation, duly organized, validly existing and in
good standing under the laws of the State of Delaware with full power and
authority (corporate and other) to own its properties and conduct its business,
as described in the Prospectus, and to enter into and perform its obligations
under this Agreement and the Pooling and Servicing Agreement, and is conducting
its business so as to comply in all material respects with all applicable
statutes, ordinances, rules and regulations of the jurisdictions in which it is
conducting business.
(d) The Company is not aware of (i) any request by the Commission for any
further amendment of the Registration Statement or the Prospectus or for any
additional information, (ii) the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose or (iii) any notification with
respect to the suspension of the qualification of the Offered Certificates for
sale in any jurisdiction or the initiation or threatening of any proceeding for
such purpose.
(e) At or prior to the Closing Date, the Company will have entered into the
Pooling and Servicing Agreement; this Agreement has been duly authorized,
executed and delivered by the Company, and the Pooling and Servicing Agreement,
when delivered by the Company, will have been duly authorized, executed and
delivered by the Company, and this Agreement and the Pooling and Servicing
Agreement will constitute valid and binding agreements of the Company,
enforceable against the Company in accordance with their terms, except as such
enforceability may be limited by (i) bankruptcy, insolvency, liquidation,
moratorium, receivership, reorganization or similar laws affecting the rights of
creditors generally, (ii) general principles of equity, whether enforcement is
sought in a proceeding in equity or at law, and (iii) public policy
considerations underlying the securities laws, to the extent that such public
policy considerations limit the enforceability of any provisions of this
Agreement which purport to provide indemnification from securities law
liabilities.
(f) The Offered Certificates and the Pooling and Servicing Agreement
conform in all material respects to the descriptions thereof contained in the
Prospectus; the Offered Certificates have been duly and validly authorized by
the Company, and will, when duly and validly executed and authenticated by the
Trustee and delivered to and paid for by the Underwriters in accordance with
this Agreement and the Pooling and Servicing Agreement, be entitled to the
benefits of the Pooling and Servicing Agreement.
(g) As of the Closing Date, the representations and warranties of the
Company set forth in Section 2.04 of the Pooling and Servicing Agreement will be
true and correct.
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(h) Neither the issuance and sale of the Offered Certificates, nor the
consummation of any other of the transactions contemplated herein, nor the
fulfillment of any of the terms of the Pooling and Servicing Agreement or this
Agreement, will result in the breach of any term or provision of the certificate
of incorporation or by-laws of the Company or conflict with, result in a
material breach, violation or acceleration of or constitute a default under, the
terms of any indenture or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which it is bound, or any statute,
order or regulation applicable to the Company or any of its subsidiaries of any
court, regulatory body, administrative agency or governmental body having
jurisdiction over the Company or any of its subsidiaries. Neither the Company
nor any of its subsidiaries is a party to, bound by or in breach or violation of
any indenture or other agreement or instrument, or subject to or in violation of
any statute, order or regulation of any court, regulatory body, administrative
agency or governmental body having jurisdiction over it, which materially and
adversely affects the ability of the Company to perform its obligations under
this Agreement and the Pooling and Servicing Agreement.
(i) There are no actions or proceedings against, or investigations of, the
Company pending, or, to the knowledge of the Company, threatened, before any
court, administrative agency or other tribunal (i) asserting the invalidity of
this Agreement, the Pooling and Servicing Agreement or the Offered Certificates,
(ii) seeking to prevent the issuance of the Offered Certificates or the
consummation of any of the transactions contemplated by this Agreement or the
Pooling and Servicing Agreement, (iii) which might materially and adversely
affect the performance by the Company of its obligations under, or the validity
or enforceability of, this Agreement, the Pooling and Servicing Agreement or the
Offered Certificates or (iv) seeking to affect adversely the federal income tax
attributes of the Offered Certificates described in the Prospectus.
(j) There has not been any material adverse change in the business,
operations, financial condition, properties or assets of the Company since the
date of its latest audited financial statements which would have a material
adverse effect on the ability of the Company to perform its obligations under
the Pooling and Servicing Agreement.
(k) There are no contracts, indentures or other documents of a character
required by the Act or by the rules and regulations thereunder to be described
or referred to in the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement which have not been so described or
referred to therein or so filed or incorporated by reference as exhibits
thereto.
(l) No authorization, approval or consent of any court or governmental
authority or agency is necessary in connection with the offering, issuance or
sale of the Offered Certificates pursuant to this Agreement and the Pooling and
Servicing Agreement, except such as have been, or as of the Closing Date will
have been, obtained or such as may otherwise be required under applicable state
securities laws in connection with the purchase and offer and sale of the
Offered Certificates by the Underwriter and any recordation of the respective
assignments of the Mortgage Loans to the Trustee pursuant to the Pooling and
Servicing Agreement that have not been completed.
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(m) The Company possesses all material licenses, certificates, authorities
or permits issued by the appropriate state, federal or foreign regulatory
agencies or bodies necessary to conduct the business now operated by it, and the
Company has not received any notice of proceedings relating to the revocation or
modification of any such license, certificate, authority or permit which, singly
or in the aggregate, if the subject of any unfavorable decision, ruling or
finding, would materially and adversely affect the condition, financial or
otherwise, or the earnings, business affairs or business prospects of the
Company.
(n) Any taxes, fees and other governmental charges payable by the Company
in connection with the execution and delivery of this Agreement and the Pooling
and Servicing Agreement or the issuance and sale of the Certificates (other than
such federal, state and local taxes as may be payable on the income or gain
recognized therefrom) have been or will be paid at or prior to the Closing Date.
(o) Immediately prior to the assignment of the Mortgage Loans to the
Trustee, the Company will have good title to, and will be the sole owner of,
each Mortgage Loan, free and clear of any pledge, mortgage, lien, security
interest or other encumbrance.
2. Purchase and Sale. Subject to the terms and conditions and in reliance
upon the representations and warranties herein set forth, the Company agrees to
sell to each Underwriter, and each Underwriter agrees, severally and not
jointly, to purchase from the Company, the principal or notional amount of each
Class of the Offered Certificates set forth opposite each such Underwriter's
name in Schedule I hereto.
The purchase price for each Class of the Offered Certificates as a
percentage of the aggregate principal (or notional) amount thereof as of the
Closing Date (as defined below) is set forth in Schedule II hereto. There will
be added to the purchase price of the Offered Certificates interest in respect
of each Class of the Offered Certificates at the interest rate applicable to
such Class from the Cut-off Date to but not including the Closing Date.
3. Delivery and Payment. The closing for the purchase and sale of the
Offered Certificates contemplated hereby (the "Closing"), shall be made at the
date, location and time of delivery set forth in Schedule II hereto, or such
later date as shall be mutually acceptable to the Underwriters and the Company
(such date and time of purchase and sale of the Offered Certificates being
herein called the "Closing Date"). Delivery of the Offered Certificates will be
made in book-entry form through the facilities of The Depository Trust Company
("DTC"). Each class of Offered Certificates will be represented by one or more
definitive global Certificates to be deposited by or on behalf of the Depositor
with DTC. Delivery of the Offered Certificates shall be made to the several
Underwriters against payment by the several Underwriters of the purchase price
thereof to or upon the order of the Company by wire transfer of immediately
available funds or by such other method as may be acceptable to the Company.
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The Company agrees to have the Offered Certificates available for
inspection, checking and packaging by the Underwriters in New York, New York,
not later than 1:00 p.m. on the business day prior to the Closing Date.
4. Offering by Underwriters. It is understood that the several Underwriters
propose to offer the Offered Certificates for sale to the public as set forth in
the Prospectus.
5. Agreements. The Company agrees with the several Underwriters that:
(a) The Company will promptly advise the Underwriters (i) when, during any
period that a prospectus relating to the Offered Certificates is required to be
delivered under the Act, any amendment to the Registration Statement shall have
become effective, (ii) of any request by the Commission for any amendment to the
Registration Statement or the Prospectus or for any additional information
affecting or in respect of the Offered Certificates, (iii) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement affecting the Offered Certificates or the institution or
threatening of any proceeding for that purpose and (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Offered Certificates for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose. The Company will not file any
amendment to the Registration Statement or supplement to the Prospectus unless
the Company has furnished you a copy for your review prior to filing and will
not file any such proposed amendment or supplement to which you reasonably
object until after the period in which a prospectus is required to be delivered
to purchasers of the Offered Certificates under the Act. Subject to the
foregoing sentence, the Company will cause the Prospectus Supplement to be
transmitted to the Commission for filing pursuant to Rule 424 under the Act by
means reasonably calculated to result in filing with the Commission pursuant to
said Rule. The Company will use its best efforts to prevent the issuance of any
such stop order and, if issued, to obtain as soon as possible the withdrawal
thereof.
(b) The Company will cause any Computational Materials and Structural Term
Sheets (each as defined in Section 9 below) with respect to the Offered
Certificates that are delivered by an Underwriter to the Company pursuant to
Section 9 to be filed with the Commission on a Current Report on Form 8-K (a
"Current Report") pursuant to Rule 13a-11 under the Exchange Act on the business
day immediately following the later of (i) the day on which such Computational
Materials and ABS Term Sheets are delivered to counsel for the Company by an
Underwriter prior to 10:30 a.m. and (ii) the date on which this Agreement is
executed and delivered. The Company will cause one Collateral Term Sheet (as
defined in Section 9 below) with respect to the Offered Certificates that is
delivered by the Underwriters to the Company in accordance with the provisions
of Section 9 to be filed with the Commission on a Current Report pursuant to
Rule 13a-11 under the Exchange Act on the business day immediately following the
day on which such Collateral Term Sheet is delivered to counsel for the Company
by the Underwriters prior to 10:30 a.m. In addition, if at any time prior to the
availability of the Prospectus Supplement, the Underwriters have delivered to
any prospective investor a subsequent Collateral Term Sheet that reflects, in
the reasonable judgment of the Underwriters and the Company, a material change
in the characteristics of the
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Mortgage Loans from those on which a Collateral Term Sheet with respect to the
Offered Certificates previously filed with the Commission was based, the Company
will cause any such Collateral Term Sheet that is delivered by the Underwriters
to the Company in accordance with the provisions of Section 9 to be filed with
the Commission on a Current Report on the business day immediately following the
day on which such Collateral Term Sheet is delivered to counsel for the Company
by the Underwriters prior to 10:30 a.m. In each case, the Company will promptly
advise the Underwriters when such Current Report has been so filed. Each such
Current Report shall be incorporated by reference in the Prospectus and the
Registration Statement. Notwithstanding the five preceding sentences, the
Company shall have no obligation to file any materials provided by the
Underwriters pursuant to Section 9 which, in the reasonable determination of the
Company, are not required to be filed pursuant to the Kidder Letters or the PSA
Letter (each as defined in Section 9 below), or contain erroneous information or
contain any untrue statement of a material fact or, when read in conjunction
with the Prospectus and Prospectus Supplement, omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; it being understood, however, that the Company shall have no
obligation to review or pass upon the accuracy or adequacy of, or to correct,
any Computational Materials or ABS Term Sheets (as defined in Section 9 below)
provided by the Underwriters to the Company pursuant to Section 9 hereof. The
Company shall give notice to the Underwriters of its determination not to file
any materials pursuant to the preceding sentence and agrees to file such
materials if the Underwriters reasonably object to such determination within one
business day after receipt of such notice.
(c) If, at any time when a prospectus relating to the Offered Certificates
is required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein in the light of the circumstances under which they
were made not misleading, or if it shall be necessary to amend or supplement the
Prospectus to comply with the Act or the rules under the Act, the Company
promptly will prepare and file with the Commission, subject to paragraph (a) of
this Section 5, an amendment or supplement that will correct such statement or
omission or an amendment that will effect such compliance and, if such amendment
or supplement is required to be contained in a post-effective amendment to the
Registration Statement, will use its best efforts to cause such amendment of the
Registration Statement to be made effective as soon as possible; provided,
however, that the Company will not be required to file any such amendment or
supplement with respect to any Computational Materials or ABS Term Sheets
incorporated by reference in the Prospectus other than any amendments or
supplements of such Computational Materials or ABS Term Sheets that are
furnished to the Company pursuant to Section 9 hereof which the Company
determines to file in accordance therewith.
(d) The Company will furnish to the Underwriters and counsel for the
Underwriters, without charge, signed copies of the Registration Statement
(including exhibits thereto) and to each other Underwriter a copy of the
Registration Statement (without exhibits thereto) and, so long as delivery of a
prospectus by an Underwriter or dealer relating to the Offered Certificates may
be required by the Act, as many copies of the Basic Prospectus, the Preliminary
Prospectus
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Supplement, if any, and the Prospectus Supplement and any amendments and
supplements thereto as the Underwriters may reasonably request.
(e) The Company agrees that, so long as the Offered Certificates shall be
outstanding, it will deliver or cause to be delivered to the Underwriters the
annual statements as to compliance and the annual statements of a firm of
independent public accountants, furnished to the Trustee by the Master Servicer
and the Special Servicer pursuant to Sections 3.13 and 3.14 of the Pooling and
Servicing Agreement, as soon as such statements are furnished to the Company.
(f) The Company will furnish such information, execute such instruments and
take such action, if any, as may be required to qualify the Offered Certificates
for sale under the laws of such jurisdictions as the Underwriters may designate
and will maintain such qualification in effect so long as required for the
distribution of the Offered Certificates; provided, however, that the Company
shall not be required to qualify to do business in any jurisdiction where it is
not now so qualified or to take any action that would subject it to general or
unlimited service of process in any jurisdiction where it is not now so subject.
(g) The Company will pay all costs and expenses in connection with the
transactions contemplated hereby, including, but not limited to, the fees and
disbursements of its counsel; the costs and expenses of printing (or otherwise
reproducing) and delivering the Pooling and Servicing Agreement and the Offered
Certificates; accounting fees and disbursements; the costs and expenses in
connection with the qualification or exemption of the Offered Certificates under
state securities or blue sky laws, including filing fees and reasonable fees and
disbursements of counsel in connection therewith, in connection with the
preparation of any Blue Sky Survey and in connection with any determination of
the eligibility of the Offered Certificates for investment by institutional
investors and the preparation of any Legal Investment Survey; the expenses of
printing any such Blue Sky Survey and Legal Investment Survey; the costs and
expenses in connection with the preparation, printing and filing of the
Registration Statement (including exhibits thereto), the Basic Prospectus, the
Preliminary Prospectus Supplement, if any, and the Prospectus Supplement, the
preparation and printing of this Agreement, the furnishing to the Underwriters
of such copies of each Preliminary Prospectus Supplement, if any, and Prospectus
Supplement as the Underwriters may reasonably request and the fees of rating
agencies. Except as provided in Section 7 hereof, the Underwriters shall be
responsible for paying all costs and expenses incurred by them in connection
with their purchase and sale of the Offered Certificates, including the fees of
counsel to any Underwriter.
6. Conditions to the Obligations to the Underwriters. The obligations of
the Underwriters to purchase the Offered Certificates as provided in this
Agreement shall be subject to the accuracy in all material respects of the
representations and warranties on the part of the Company contained herein as of
the date hereof and the Closing Date, to the accuracy in all material respects
of the statements of the Company made in any certificates pursuant to the
provisions hereof, to the performance in all material respects by the Company of
its obligations hereunder and to the following additional conditions with
respect to the Offered Certificates:
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(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been instituted or threatened; and the Prospectus Supplement shall have been
filed with the Commission within the time period prescribed by the Commission.
(b) The Underwriters shall have received from the Company a certificate,
dated the Closing Date and executed by an executive officer of the Company, to
the effect that: (i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects at and as of the Closing
Date with the same effect as if made on the Closing Date; and (ii) the Company
has in all material respects complied with all the agreements and satisfied all
the conditions on its part to be performed or satisfied at or prior to the
Closing Date.
(c) The Underwriters shall have received with respect to the Company a good
standing certificate from the Secretary of State of the State of Delaware, dated
not earlier than 30 days prior to the Closing Date.
(d) The Underwriters shall have received from the Secretary or an assistant
secretary of the Company, in his individual capacity, a certificate, dated the
Closing Date, to the effect that: (i) each individual who, as an officer or
representative of the Company, signed this Agreement, the Pooling and Servicing
Agreement or any other document or certificate delivered on or before the
Closing Date in connection with the transactions contemplated herein or in the
Pooling and Servicing Agreement, was at the respective times of such signing and
delivery, and is as of the Closing Date, duly elected or appointed, qualified
and acting as such officer or representative, and the signatures of such persons
appearing on such documents and certificates are their genuine signatures; and
(ii) no event (including, without limitation, any act or omission on the part of
the Company) has occurred since the date of the good standing certificate
referred to in paragraph (c) above which has affected the good standing of the
Company under the laws of the State of Delaware. Such certificate shall be
accompanied by true and complete copies (certified as such by the Secretary or
an assistant secretary of the Company) of the certificate of incorporation and
by-laws of the Company, as in effect on the Closing Date, and of the resolutions
of the Company and any required shareholder consent relating to the transactions
contemplated in this Agreement and the Pooling and Servicing Agreement.
(e) The Underwriters shall have received from Sidley & Austin, counsel for
the Company, a favorable opinion, dated the Closing Date and reasonably
satisfactory in form and substance to counsel for the Underwriters, to the
effect that:
(i) The Registration Statement has become effective under the 1933
Act.
(ii) To such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and not
withdrawn, and no proceedings for that purpose have been instituted or
threatened and not terminated.
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(iii) The Registration Statement, the Basic Prospectus and the
Prospectus Supplement, as of their respective effective or issue dates
(other than the financial statements, schedules and other financial and
statistical information contained therein or omitted therefrom, as to which
such counsel need express no opinion), complied as to form in all material
respects with the applicable requirements of the Act and the rules and
regulations thereunder.
(iv) To such counsel's knowledge, there are no material contracts,
indentures or other documents relating to the Offered Certificates of a
character required to be described or referred to in the Registration
Statement or the Prospectus Supplement or to be filed as exhibits to the
Registration Statement, other than those described or referred to therein
or filed or incorporated by reference as exhibits thereto.
(v) The Company is duly incorporated and validly existing as a
corporation in good standing under the laws of the State of Delaware and
has the requisite corporate power and authority to enter into and perform
its obligations under this Agreement and the Pooling and Servicing
Agreement.
(vi) Each of this Agreement and the Pooling and Servicing Agreement
has been duly authorized, executed and delivered by the Company.
(vii) Each of this Agreement and the Pooling and Servicing Agreement
constitutes a valid, legal and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as
enforceability may be limited by (A) bankruptcy, insolvency, liquidation,
receivership, moratorium, reorganization or other similar laws affecting
the enforcement of the rights of creditors generally, (B) general
principles of equity, regardless of whether enforcement is sought in a
proceeding in equity or at law, and (C) public policy considerations
underlying the securities laws to the extent that the same limit the
enforceability of any provisions of this Agreement that purport or are
construed to provide indemnification with respect to securities law
violations.
(viii) The Offered Certificates, when duly and validly executed,
authenticated and delivered in accordance with the Pooling and Servicing
Agreement and paid for in accordance with this Agreement, will be entitled
to the benefits of the Pooling and Servicing Agreement.
(ix) Neither the sale of the Offered Certificates to the Underwriters
pursuant to this Agreement nor the consummation of any of the transactions
contemplated by or the fulfillment by the Company of the terms of this
Agreement and the Pooling and Servicing Agreement, will conflict with or
result in a breach or violation of any term or provision of the certificate
of incorporation or by-laws of the Company, or any federal or State of New
York statute or regulation, or any order known to such counsel of any
federal or State of New York court or agency or other governmental body
having jurisdiction over the
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Company, except such counsel need express no opinion as to compliance with
the securities laws of the State of New York and other particular States in
connection with the purchase and the offer and sale of the Offered
Certificates by the Underwriters.
(x) No consent, approval, authorization or order of any federal or
State of New York or Delaware court, agency or other governmental body is
required for the consummation by the Company of the transactions
contemplated by the terms of this Agreement and the Pooling and Servicing
Agreement, except such as may be required under the securities laws of the
State of New York and other particular States in connection with the
purchase and the offer and sale of the Offered Certificates by the
Underwriters as to which such counsel need express no opinion, and except
such as have been obtained.
(xi) The Pooling and Servicing Agreement is not required to be
qualified under the Trust Indenture Act of 1939, as amended. The Trust Fund
is not required to be registered under the Investment Company Act of 1940,
as amended.
(xii) The statements set forth in the Prospectus Supplement under the
headings "Description of the Certificates" and "Servicing of the Mortgage
Loans" and in the Basic Prospectus under the headings "Description of the
Certificates" and "Description of the Pooling Agreements", insofar as such
statements purport to summarize certain material provisions of the
Certificates and the Pooling and Servicing Agreement, provide a fair and
accurate summary of such provisions.
(xiii) The statements set forth in each of the Prospectus Supplement
and the Basic Prospectus under the headings "ERISA Considerations",
"Certain Federal Income Tax Consequences" and "Legal Investment", to the
extent that they purport to describe certain matters of federal law or
legal conclusions with respect thereto, while not discussing all possible
consequences of an investment in the Offered Certificates to all investors,
provide a fair and accurate summary of such matters and conclusions set
forth under such headings.
(xiv) As described in the Prospectus Supplement, and assuming
compliance with all the provisions of the Pooling and Servicing Agreement,
(A) REMIC I will qualify as a real estate mortgage investment conduit (a
"REMIC") within the meaning of Sections 860A through 860G of the Internal
Revenue Code of 1986 in effect on the date hereof (the "REMIC Provisions")
and the REMIC I Regular Interests will be "regular interests" and the Class
R-I Certificates will evidence the sole class of "residual interests" in
REMIC I (as both terms are defined in the REMIC Provisions in effect on the
Closing Date), (B) REMIC II will qualify as a REMIC within the meaning of
the REMIC Provisions, and the REMIC II Regular Interests will be "regular
interests" and the Class R-II Certificates will evidence the sole class of
"residual interests" in REMIC II, and (C) REMIC III will qualify as a REMIC
within the meaning of the REMIC Provisions, and the Class CP, Class S,
Class A-1A, Class A-1B, Class A-2, Class A-3, Class B-1, Class B-2, Class
B-3, Class B-4, Class B-5, Class B-6, Class
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<PAGE>
B-7 and Class C Certificates will evidence "regular interests" and the
Class R-III Certificates will evidence the sole class of "residual
interests" in REMIC III.
(xv) Assuming compliance with all the provisions of the Pooling and
Servicing Agreement, for City and State of New York income and corporation
franchise tax purposes: (A) REMIC I, REMIC II and REMIC III will each be
classified as a REMIC, and not as a corporation, partnership or trust, in
conformity with the federal income tax treatment of REMIC I, REMIC II and
REMIC III, respectively; and (B) the Trust Fund will be exempt from all
City and State of New York taxation imposed on its income, franchise or
capital stock, and its assets will not be included in the calculation of
any City or State of New York franchise tax liability.
Such opinion (x) may express its reliance as to factual matters on
certificates of government and agency officials and the representations and
warranties made by, and on certificates or other documents furnished by officers
of, the parties to this Agreement and the Pooling and Servicing Agreement, (y)
may assume the due authorization, execution and delivery of the instruments and
documents referred to therein by the parties thereto other than the Company, and
(z) may be qualified as an opinion only on the law of the State of New York, the
federal law of the United States of America and the General Corporation Law of
the State of Delaware.
Based on such counsel's participation in conferences with officers and
other representatives of the Company and of the Servicer, the Special Servicer,
the Trustee, the REMIC Administrator, the Underwriters and their respective
counsel, at which the contents of the Registration Statement and the Prospectus
were discussed and, although such counsel need not pass upon or assume
responsibility for the actual accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus (except as
stated in paragraphs (xii) and (xiii) above) and need not make an independent
check or verification thereof for the purpose of rendering this opinion, on the
basis of the foregoing, such counsel shall also confirm that nothing has come to
the attention of such counsel that would lead such counsel to believe that the
Prospectus, as of the date of the Prospectus Supplement and at the Closing Date,
contained or contains an untrue statement of a material fact or omitted or omits
to state a material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading (other than
financial statements, schedules and other numerical, financial and statistical
data included therein or omitted therefrom, the documents incorporated therein
and the information included under the caption "Method of Distribution"
contained in the Prospectus, as to which such counsel need express no opinion).
Insofar as questions of materiality are involved in the foregoing opinion, such
counsel may as to factual matters necessary to the determination of materiality
rely upon certificates and other information provided by officers and other
representatives to the Company and as to determinations of materiality, may seek
in the first instance and rely where such counsel concludes such reliance is
justifiable, on the view of officers and other representatives of the Company.
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<PAGE>
(f) The Underwriters shall have received, with respect to each of the
Servicer, the Special Servicer, the REMIC Administrator and the Trustee, a
favorable opinion of counsel, dated the Closing Date, addressing the valid
existence of such party under the laws of the jurisdiction of its organization,
the due authorization, execution and delivery of the Pooling and Servicing
Agreement by such party and, subject to the same limitations as set forth in
Section 6(e)(vii), the enforceability of the Pooling and Servicing Agreement
against such party. Such opinion may express its reliance as to factual matters
on representations and warranties made by, and on certificates or other
documents furnished by officers and/or authorized representatives of parties to,
this Agreement and the Pooling and Servicing Agreement and on certificates
furnished by public officials. Such opinion may assume the due authorization,
execution and delivery of the instruments and documents referred to therein by
the parties thereto other than the party on behalf of which such opinion is
being rendered. Such opinion may be qualified as an opinion only on the General
Corporation Law of the State of Delaware (if relevant), the laws of each state
in which the writer of the opinion is admitted to practice law and the federal
law of the United States.
(g) The Underwriters shall have received from Arthur Andersen & Co.,
certified public accountants, a letter dated the Closing Date and satisfactory
in form and substance to the Underwriters and counsel for the Underwriters
stating in effect that using the assumptions and methodology used by the
Company, all of which shall be described in such letter, they have recalculated
such numbers and percentages set forth in the Prospectus as the Underwriters may
reasonably request and as are agreed to by Arthur Andersen & Co., compared the
results of their calculations to the corresponding items in the Prospectus, and
found each such number and percentage set forth in the Prospectus to be in
agreement with the results of such calculations.
(h) The Offered Certificates listed on Schedule II hereto shall have been
rated as indicated on such Schedule by the rating agency or agencies indicated.
(i) All proceedings in connection with the transactions contemplated by
this Agreement, and all documents incident hereto and thereto, shall be
satisfactory in form and substance to the Underwriters and counsel for the
Underwriters, and the Underwriters and counsel for the Underwriters shall have
received such additional information, certificates and documents as they may
reasonably request.
If any of the conditions specified in this Section 6 shall not have been
fulfilled in all material respects when and as provided by this Agreement, or if
any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Underwriters and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Underwriters. Notice of such
cancellation shall be given to the Company in writing, or by telephone or by
either telegraph or telecopier confirmed in writing.
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<PAGE>
7. Reimbursement of Underwriters' Expenses. If the sale of any Offered
Certificates provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied
or because of any refusal, inability or failure on the part of the Company to
perform any agreement herein or therein or comply with any provision hereof or
thereof, other than by reason of a default by any of the Underwriters, the
Company will reimburse the Underwriters severally upon demand for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of such Offered Certificates.
8. Indemnification and Contribution. (a) The Company agrees to indemnify
and hold harmless each Underwriter and each person who controls any Underwriter
within the meaning of the Act or the Exchange Act of 1934, as amended (the
"Exchange Act"), against claims, damages, or liabilities, joint or several, to
which such Underwriter may become subject, under the Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages, or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in any part of the
Registration Statement when such part became effective, or in the Registration
Statement, any Preliminary Prospectus Supplement, the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission (in the case of any Computational Materials or ABS Term
Sheets (as defined in Section 9 below) in respect of which the Company agrees to
indemnify any Underwriter or any such controlling person, as set forth below,
when such are read in conjunction with the Prospectus) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Underwriter and each such
controlling person for any legal or other expenses reasonably incurred by it in
connection with investigating or defending against such loss, claim, damage,
liability, or action; provided, however, (i) that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage, or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made therein (A) in reliance upon and
in conformity with written information furnished to the Company by any
Underwriter directly or through another Underwriter specifically for use in the
preparation thereof or (B) in any Current Report or any amendment or supplement
thereof, except to the extent that any untrue statement or alleged untrue
statement therein or omission therefrom results (or is alleged to have resulted)
directly from an error (a "Collateral Error") in the information concerning the
characteristics of the Mortgage Loans furnished by the Company to an Underwriter
in writing or by electronic transmission that was used in the preparation of
either (x) any Computational Materials or ABS Term Sheets (or amendments or
supplements thereof) or (y) any written or electronic materials furnished to
prospective investors on which the Computational Materials (or amendments or
supplements) were based, (ii) such indemnity with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter (or any person
controlling any Underwriter) from whom the person asserting any such loss,
claim, damage or liability purchased the Offered Certificates which are the
subject thereof if such person did not receive a copy of the Prospectus (or the
Prospectus as amended or supplemented) at or prior to the confirmation of the
sale of such Certificates to such person in any case where such delivery is
required by the Act and the untrue statement or omission of a material fact
contained in such preliminary prospectus was corrected in the Prospectus (or the
Prospectus as
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<PAGE>
amended or supplemented) and (iii) such indemnity with respect to any Collateral
Error shall not inure to the benefit of any Underwriter (or any person
controlling any Underwriter) from whom the person asserting any loss, claim,
damage or liability received any Computational Materials or ABS Term Sheets (or
any written or electronic materials on which the Computational Materials or ABS
Term Sheets are based) that were prepared on the basis of such Collateral Error,
if, prior to the time of confirmation of the sale of the applicable Offered
Certificates to such person, the Company notified such Underwriter in writing of
the Collateral Error or provided in written or electronic form information
superseding or correcting such Collateral Error (in any such case, a "Corrected
Collateral Error"), and such Underwriter failed to notify such person thereof or
to deliver to such person corrected Computational Materials (or underlying
written or electronic materials) or ABS Term Sheets. This indemnity agreement
will be in addition to any liability which the Company may otherwise have.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, each of its directors, each of its officers who
signed the Registration Statement, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, to the same extent as
the foregoing indemnity from the Company to each Underwriter, but only with
reference to (A) written information relating to such Underwriter furnished to
the Company by such Underwriter directly or through another Underwriter
specifically for use in the preparation of the documents referred to in the
foregoing indemnity, or (B) any Computational Materials or ABS Term Sheets (or
amendments or supplements thereof) delivered to prospective investors by such
Underwriter and furnished to the Company by such Underwriter pursuant to or as
contemplated by Section 9 and incorporated by reference in the Registration
Statement or the Prospectus or any amendment or supplement thereof (except that
no such indemnity shall be available for any losses, claims, damages or
liabilities, or actions in respect thereof, resulting from any Collateral Error,
other than a Corrected Collateral Error). This indemnity agreement will be in
addition to any liability which any Underwriter may otherwise have. The Company
acknowledges that the statements set forth in the last paragraph of the cover
page and under the heading "Method of Distribution" in any Preliminary
Prospectus Supplement or the Prospectus constitute the only information
furnished in writing by or on behalf of the several Underwriters for inclusion
in the documents referred to in the foregoing indemnity (other than any
Computational Materials or ABS Term Sheets furnished to the Company by any
Underwriter), and you confirm that such statements are correct. Any
Computational Materials or ABS Term Sheets (or amendments or supplements
thereof) furnished to the Company by a particular Underwriter shall relate
exclusively to and be the several responsibility of such Underwriter and no
other Underwriter.
(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than under
this Section 8. In case any such action is brought against any indemnified
party, and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and to
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<PAGE>
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel satisfactory to such indemnified
party (which may be counsel representing the indemnifying party); provided,
however, that if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate counsel in
connection with the assertion of legal defenses in accordance with the proviso
to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel, approved by you in the case of paragraph (a) of this Section
8, representing the indemnified parties under such paragraph (a) who are parties
to such action), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that, if clause (i)
or (iii) is applicable, such liability shall be only in respect of the counsel
referred to in such clause (i) or (iii).
(d) If the indemnification provided for in this Section 8 is unavailable or
insufficient to hold harmless an indemnified party under paragraph (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages, or
liabilities referred to in paragraph (a) or (b) above as follows:
(i) in the case of any losses, claims, damages and liabilities (or
actions in respect thereof) which do not arise out of or are not based upon
any untrue statement or omission of a material fact in any Computational
Materials or ABS Term Sheets (or any amendments or supplements thereof) in
such proportion so that the Underwriters are responsible for that portion
represented by the percentage that the underwriting discount bears to the
sum of such discount and the purchase price of the Offered Certificates
specified in Schedule I hereto and the Company is responsible for the
balance; provided, however, that in no case shall any Underwriter (except
as may be provided in any agreement among underwriters relating to the
offering of the Offered Certificates) be responsible under this
subparagraph (i) for any amount in excess of the underwriting discount
applicable to the Offered Certificates purchased by such Underwriter
hereunder; and
(ii) in the case of any losses, claims, damages and liabilities (or
actions in respect thereof) which arise out of or are based upon any untrue
statement or omission of a material fact in any Computational Materials or
ABS Terms Sheets (or any amendments or
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<PAGE>
supplements thereof) or in any written or electronic materials on which the
Computational Materials are based, in such proportion as is appropriate to
reflect the relative fault of the Company on the one hand and the
Underwriters on the other in connection with the statement or omissions
which resulted in such losses, claims, damages or liabilities (or actions
in respect thereof) as well as any other relevant equitable considerations.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact in such Computational
Materials or ABS Term Sheets (or any amendments or supplements thereof or
such written or electronic materials) results from information prepared by
the Company on the one hand or the Underwriters on the other and the
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
Notwithstanding anything to the contrary in this paragraph (d), no person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 8, each person
who controls an Underwriter within the meaning of the Act shall have the same
rights to contribution as such Underwriter, and each person who controls the
Company within the meaning of either the Act or the Exchange Act, each officer
of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the
Company, subject in each case to the preceding sentence of this paragraph (d).
Any party entitled to contribution will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in respect of
which a claim for contribution may be made against another party or parties
under this paragraph (d), notify such party or parties from whom contribution
may be sought, but the omission to so notify such party or parties shall not
relieve the party or parties from whom contribution may be sought from any other
obligation it or they may have hereunder or otherwise than under this paragraph
(d).
9. Computational Materials and ABS Term Sheets. (a) Not later than 10:30
a.m., New York City time, on the date hereof, the Underwriters shall deliver to
the Company and its counsel, as provided below, five complete copies of all
materials provided by the Underwriters to prospective investors in the Offered
Certificates which constitute either (i) "Computational Materials" within the
meaning of the no-action letter dated May 20, 1994 issued by the Division of
Corporation Finance of the Commission to Kidder, Peabody Acceptance Corporation
I, Kidder, Peabody & Co. Incorporated, and Kidder Structured Asset Corporation
and the no-action letter dated May 27, 1994 issued by the Division of
Corporation Finance of the Commission to the Public Securities Association
(together, the "Kidder Letters") or (ii) "ABS Term Sheets" within the meaning of
the no-action letter dated February 17, 1995 issued by the Division of
Corporation Finance of the Commission to the Public Securities Association (the
"PSA Letter" and together with the Kidder Letters, the "No-Action Letters"), if
the filing of such materials with the Commission is a condition of the relief
granted in such letters and, in the case of any such materials that constitute
"Collateral Term Sheets" within the meaning of the PSA Letter, such Collateral
Term Sheets have not previously been delivered to the Company as contemplated by
Section 9(b)(i) below. For purposes of this Agreement, "Structural Term Sheets"
shall have the meaning set forth in the PSA Letter. Each delivery of
Computational
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Materials and/or ABS Term Sheets to the Company pursuant to this paragraph (a)
shall be effected by delivering four copies of such materials to counsel for the
Company on behalf of the Company at the address specified in Section 13 hereof
and one copy of such materials to the Company.
(b) Each underwriter represents and warrants to and agrees with the
Company, as of the date hereof and as of the Closing Date, as applicable, that:
(i) if such Underwriter has provided any Collateral Term Sheets to
potential investors in the Offered Certificates prior to the date hereof
and if the filing of such materials with the Commission is a condition of
the relief granted in the PSA Letter, then in each such case such
Underwriter delivered four copies of such materials to counsel for the
Company on behalf of the Company at the address specified in Section 13
hereof and one copy of such materials to the Company no later than 10:30
a.m., New York City time, on the first business day following the date on
which such materials were initially provided to a potential investor;
(ii) the Computational Materials (either in original, aggregated or
consolidated form) and ABS Term Sheets furnished to the Company pursuant to
Section 9(a) or as contemplated in Section 9(b)(i) constitute all of the
materials relating to the Offered Certificates furnished by such
Underwriter (whether in written, electronic or other format) to prospective
investors in the Offered Certificates prior to the date hereof, except for
any preliminary prospectus with respect to the Offered Certificates and any
Computational Materials and ABS Term Sheets with respect to the Offered
Certificates which are not required to be filed with the Commission in
accordance with the No-Action Letters, and all Computational Materials and
ABS Term Sheets provided by such Underwriter to potential investors in the
Offered Certificates comply with the requirements of the No-Action Letters;
(iii) on the respective dates any such Computational Materials and/or
ABS Term Sheets with respect to the Offered Certificates referred to in
Section 9(b)(ii) were last furnished by such Underwriter to each
prospective investor, on the date of delivery thereof to the Company
pursuant to or as contemplated by this Section 9 and on the Closing Date,
such Computational Materials and/or ABS Term Sheets did not and will not
include any untrue statement of a material fact, or, when read in
conjunction with the Prospectus, omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading;
(iv) at the time any Computational Materials or ABS Term Sheets with
respect to the Offered Certificates were furnished to a prospective
investor and on the date hereof, the Underwriters possessed, and on the
date of delivery of such materials to the Company pursuant to or as
contemplated by this Section 9 and on the Closing Date, the Underwriters
will possess, the capability, knowledge, expertise, resources and systems
of internal control necessary to ensure that such Computational Materials
and/or ABS Term Sheets conform to the representations and warranties of the
Underwriters contained in subparagraphs (ii) and (iii) above of this
paragraph (b);
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<PAGE>
(v) all Collateral Term Sheets with respect to the Offered
Certificates furnished by such Underwriter to potential investors contained
and will contain a legend, prominently displayed on the first page thereof,
indicating that the information contained therein will be superseded by the
description of the Mortgage Loans contained in the Prospectus and, except
in the case of the initial Collateral Term Sheet, that such information
supersedes the information in all prior Collateral Term Sheets; and
(vi) on and after the date hereof, such Underwriter shall not deliver
or authorize the delivery of any Computational Materials, ABS Term Sheets
or other materials relating to the Offered Certificates (whether in
written, electronic or other format) to any potential investor unless such
potential investor has received a Prospectus prior to or at the same time
as the delivery of such Computational Materials, ABS Term Sheets or other
materials.
Notwithstanding the foregoing, the Underwriters make no representation or
warranty as to whether any Computational Materials or ABS Term Sheets with
respect to the Offered Certificates included or will include any untrue
statement resulting directly from any Collateral Error (except any Corrected
Collateral Error, with respect to materials prepared after the receipt by the
Underwriters from the Company of notice of such Corrected Collateral Error or
materials superseding or correcting such Corrected Collateral Error).
(c) The Underwriters acknowledge and agree that the Company has not
authorized and will not authorize the distribution of any Computational
Materials or ABS Term Sheets with respect to the Offered Certificates to any
prospective investor. The Underwriters agree that they will not represent to
potential investors that any Computational Materials and/or ABS Term Sheets with
respect to the Offered Certificates were prepared or disseminated on behalf of
the Company.
(d) If, at any time when a prospectus relating to the Offered Certificates
is required to be delivered under the Act, it shall be necessary in the opinion
of the Underwriters or their counsel to amend or supplement the Prospectus as a
result of an untrue statement of a material fact contained in any Computational
Materials or ABS Term Sheets provided by the Underwriters pursuant to or as
contemplated by this Section 9 or the omission to state a material fact
required, when considered in conjunction with the Prospectus, to be stated
therein or necessary to make the statements therein, when read in conjunction
with the Prospectus, not misleading, or if it shall be necessary to amend or
supplement any Current Report to comply with the Act or the rules thereunder,
the Underwriters, at their expense, promptly will prepare and furnish to the
Company for filing with the Commission an amendment or supplement which will
correct such statement or omission or an amendment which will effect such
compliance and shall distribute such amendment or supplement to each prospective
investor in the Offered Certificates that received such information being
amended or supplemented. Each Underwriter represents and warrants to the
Company, as of the date of delivery of such amendment or supplement to the
Company, that such amendment or supplement will not include any untrue statement
of a material fact or, when read in conjunction with the Prospectus, omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading. The Company shall have no obligation to file
such amendment or supplement if the
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Company determines that (i) such amendment or supplement contains any untrue
statement of a material fact or, when read in conjunction with the Prospectus,
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading (it being understood, however, that
the Company shall have no obligation to review or pass upon the accuracy or
adequacy of, or to correct, any such amendment or supplement provided by the
Underwriters to the Company pursuant to this paragraph (d)) or (ii) such filing
is not required under the Act. Notwithstanding the foregoing, none of the
Underwriters make any representation or warranty as to whether any such
amendment or supplement of Computational Materials or ABS Term Sheets with
respect to the Offered Certificates included or will include any untrue
statement resulting directly from any Collateral Error (except any Corrected
Collateral Error, with respect to materials prepared after the receipt by the
Underwriters from the Company of notice of such Corrected Collateral Error or
materials superseding or correcting such Corrected Collateral Error).
(e) If, at any time when a prospectus relating to the Offered Certificates
is required to be delivered under the Act, it shall be necessary in the opinion
of the Company or its counsel to amend or supplement the Prospectus as a result
of an untrue statement of a material fact contained in any Computational
Materials or ABS Term Sheets provided by the Underwriters pursuant to or as
contemplated by this Section 9 or the omission to state therein a material fact
required, when considered in conjunction with the Prospectus, to be stated
therein or necessary to make the statements therein, when read in conjunction
with the Prospectus, not misleading, or if it shall be necessary to amend or
supplement any Current Report to comply with the Act or the rules thereunder,
the Company promptly will notify each Underwriter of the necessity of such
amendment or supplement, and the Underwriters, at their expense (such expense to
be allocated between them based on the relative fault of the Underwriters) (or,
if such amendment or supplement is necessary due to a Collateral Error (except
any Corrected Collateral Error, with respect to materials prepared after the
receipt by the Underwriters from the Company of notice of such Corrected
Collateral Error or materials superseding or correcting such Corrected
Collateral Error), at the expense of the Company), shall prepare and furnish to
the Company for filing with the Commission an amendment or supplement which will
correct such statement or omission or an amendment which will effect such
compliance and shall distribute such amendment or supplement to each prospective
investor in the Offered Certificates that received such information being
amended or supplemented. Notwithstanding the foregoing, none of the Underwriters
make any representation or warranty as to whether any such amendment or
supplement of Computational Materials or ABS Term Sheets with respect to the
Offered Certificates included or will include any untrue statement resulting
directly from any Collateral Error (except any Corrected Collateral Error, with
respect to materials prepared after the receipt by the Underwriters from the
Company of notice of such Corrected Collateral Error or materials superseding or
correcting such Corrected Collateral Error).
(f) The Underwriters (at their own expense) further agree to provide to the
Company any accountants' letters obtained relating to the Computational
Materials and/or ABS Term Sheets, which accountants' letters shall be addressed
to the Company or shall state that the Company may rely thereon; provided that
the Underwriters shall have no obligation to procure any such letter.
-20-
<PAGE>
10. Substitution of Underwriters. (a) If any Underwriter shall fail to take
up and pay for the amount of the Offered Certificates agreed by such Underwriter
to be purchased under this Agreement, upon tender of such Offered Certificates
in accordance with the terms hereof, and the amount of the Offered Certificates
not purchased does not aggregate more than 10% of the total amount of the
Offered Certificates set forth in Schedule I hereof, the remaining Underwriters
shall be obligated to take up and pay for the Offered Certificates that the
withdrawing or defaulting Underwriter agreed but failed to purchase.
(b) If any Underwriter shall fail to take up and pay for the amount of the
Offered Certificates agreed by such Underwriter to be purchased under this
Agreement (such Underwriter being a "Defaulting Underwriter"), upon tender of
such Certificates in accordance with the terms hereof and thereof, and the
amount of the Offered Certificates not purchased aggregates more than 10% of the
total amount of the Offered Certificates set forth in Schedule I hereto, and
arrangements satisfactory to the remaining Underwriters and the Company for the
purchase of such Certificates by other persons are not made within 36 hours
thereafter, this Agreement shall terminate. In the event of any such termination
the Company shall not be under any liability to any Underwriter (except to the
extent provided in Section 5(g) and Section 8 hereof) nor shall any Underwriter
(other than an Underwriter who shall have failed, otherwise than for some reason
permitted under this Agreement, to purchase the amount of the Offered
Certificates such Underwriter agreed to purchase hereunder) be under any
liability to the Company (except to the extent provided in Sections 8 and 9
hereof). Nothing herein shall be deemed to relieve any Defaulting Underwriter
from any liability it may have to the Company or any other Underwriter by reason
of its failure to take up and pay for Offered Certificates as agreed by such
Defaulting Underwriter.
11. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Underwriters by notice given to the Company prior to
delivery of and payment for all Offered Certificates if prior to such time (i)
trading in securities of the Company or any affiliate on the New York Stock
Exchange shall have been suspended or limited, or minimum prices shall have been
established on such Exchange, (ii) a banking moratorium shall have been declared
by either federal or New York State authorities, or (iii) there shall have
occurred any outbreak or material escalation of hostilities or other calamity or
crisis, the effect of which on the financial markets of the United States is
such as to make it, in the reasonable judgment of the Underwriters, impractical
to market the Offered Certificates.
12. Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers and the Underwriters set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of any Underwriter or the Company or any of the officers,
directors or controlling persons referred to in Section 8 hereof, and will
survive delivery of and payment for the Offered Certificates. The provisions of
Sections 7, 8 and 9 hereof shall survive the termination or cancellation of this
Agreement.
-21-
<PAGE>
13. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to the Underwriters, will be mailed, delivered or
either telegraphed or transmitted by telecopier and confirmed to them at the
addresses set forth on Schedule I hereto; or, if sent to the Company will be
mailed, delivered or either telegraphed or transmitted by telecopier and
confirmed to it at 277 Park Avenue, 9th Floor, New York, New York 10172,
Attention: N. Dante LaRocca, with a copy to Sidley & Austin, 875 Third Avenue,
New York, New York 10022, Attention: William J. Cullen.
14. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers,
directors and controlling persons referred to in Section 8 hereof, and their
successors and assigns, and no other person will have any right or obligation
hereunder.
15. Applicable Law; Counterparts. This Agreement will be governed by and
construed in accordance with the substantive laws of the State of New York
applicable to agreements made and to be performed entirely in said State. This
Agreement may be executed in any number of counterparts, each of which shall for
all purposes be deemed to be an original and all of which shall together
constitute but one and the same instrument.
-22-
<PAGE>
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us a counterpart hereof, whereupon this letter and
your acceptance shall represent a binding agreement among the Company and the
several Underwriters.
Very truly yours,
DLJ COMMERCIAL MORTGAGE CORP.
By: ___________________________________
Name:
Title:
Accepted at New York, New York
as of the date first written above.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By: _____________________________
Name:
Title:
<PAGE>
SCHEDULE I
Principal or Notional
Amount of Relevant
Underwriter Class of Offered
(and address) Class Certificates to be Purchased
- - ------------- ----- ----------------------------
Donaldson, Lufkin & Jenrette Class CP $482,300,000**
Securities Corporation* Class S $838,800,140**
277 Park Avenue Class A-1A $125,000,000
New York, New York 10172 Class A-1B $466,300,000
Attention: N. Dante LaRocca Class A-2 $50,400,000
Class A-3 $50,300,000
Class B-1 $41,900,000
Class B-2 $14,700,000
- - ----------
* Only Underwriter.
** Notional Amount.
<PAGE>
SCHEDULE II
Registration Statement No. 333-32019
Basic Prospectus dated February 17, 1998
Prospectus Supplement dated February 20, 1998
Title of Offered Certificates: Commercial Mortgage Pass-Through Certificates,
Series 1998-CF1, Class CP, Class S, Class A-1A,
Class A-1B, Class A-2, Class A-3, Class B-1, and
Class B-2
Cut-off Date: March 1, 1998
Closing: 10:00 a.m. on March 2, 1998
at the offices of
Sidley & Austin
875 Third Avenue
New York, New York 10022
<PAGE>
<TABLE>
<CAPTION>
Initial
Aggregate Principal
(or, in the case of
Class CP and Class S
Class Certificates, Notional) Initial
Designation Amount of Class (1) Pass-Through Rate Purchase Price(2) Rating(3)
- - ----------- ---------------------- ----------------- ----------------- ---------
<S> <C> <C> <C> <C>
Class CP $482,300,000 0.9064% 4 03/64% AAA/AAA/Aaa
Class S $838,800,140 0.7181% 2 30/64% AAA/AAA/Aaa
Class A-1A $125,000,000 6.1400% 99 16/64% AAA/AAA/Aaa
Class A-1B $466,300,000 6.4100% 100 02/64% AAA/AAA/Aaa
Class A-2 $50,400,000 6.5900% 100 00/64% AA/AA/Aa2
Class A-3 $50,300,000 6.7000% 100 00/64% A/A/A2
Class B-1 $41,900,000 7.0600% 99 63/64% BBB/BBB/Baa2
Class B-2 $14,700,000 7.3300% 100 03/64% BBB-/NR/Baa3
</TABLE>
- - ----------
(1) Subject to a variance of plus or minus 5%
(2) Expressed as a percentage of the aggregate stated or notional amount, as
applicable, of the relevant class of Offered Certificates to be purchased.
The purchase price for each class of the Offered Certificates will include
accrued interest at the initial Pass-Through Rate therefor on the aggregate
stated or notional amount, as applicable, thereof to be purchased from the
Cut-off Date to but not including the Closing Date.
(3) By each of Standard & Poor's Ratings Services, Fitch IBCA, Inc. and Moody's
Investors Services, Inc.
<PAGE>
EXECUTION COPY
================================================================================
DLJ COMMERCIAL MORTGAGE CORP.,
as Depositor,
BANC ONE MORTGAGE CAPITAL MARKETS, LLC,
as Servicer,
CLARION PARTNERS, LLC,
as Special Servicer,
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
as Trustee and REMIC Administrator,
POOLING AND SERVICING AGREEMENT
Dated as of March 1, 1998
------------------------------
$838,800,140
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
================================================================================
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Section Page
- - ------- ----
<S> <C>
ARTICLE I
DEFINITIONS; GENERAL INTERPRETIVE PRINCIPLES;
CERTAIN CALCULATIONS IN RESPECT
OF THE MORTGAGE POOL
1.01. Defined Terms....................................................................................................2
1.02. General Interpretive Principles.................................................................................37
1.03. Certain Calculations in Respect of the Mortgage Pool............................................................38
1.04. Cross-Collateralized Mortgage Loans.............................................................................39
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES; ORIGINAL ISSUANCE OF REMIC I REGULAR INTERESTS,
REMIC II REGULAR INTERESTS, CLASS CP REMIC III REGULAR INTERESTS,
CLASS S REMIC III REGULAR INTERESTS AND CERTIFICATES
2.01. Conveyance of Mortgage Loans....................................................................................41
2.02. Acceptance of Mortgage Assets by Trustee........................................................................43
2.03. Certain Repurchases and Substitutions of Mortgage Loans by the Originators......................................45
2.04. Representations and Warranties of the Depositor.................................................................48
2.05. Representations and Warranties of the Servicer..................................................................49
2.06. Representations and Warranties of the Special Servicer..........................................................51
2.07. Representations and Warranties of the Trustee...................................................................52
2.08. Representations and Warranties of the REMIC Administrator.......................................................54
2.09. Designation of the Certificates.................................................................................55
2.10. Creation of REMIC I; Issuance of REMIC I Regular Interests and Class R-I Certificates...........................56
2.11. Conveyance of REMIC I Regular Interests; Acceptance of
REMIC I Regular Interests by Trustee..........................................................................58
2.12. Creation of REMIC II; Issuance of REMIC II Regular Interests
and Class R-II Certificates...................................................................................58
2.13. Conveyance of REMIC II Regular Interests; Acceptance of
REMIC II Regular Interests by Trustee.........................................................................60
2.14. Creation of REMIC III; Issuance of REMIC III Certificates.......................................................60
</TABLE>
-ii-
<PAGE>
<TABLE>
<CAPTION>
Section Page
- - ------- ----
<S> <C>
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
3.01. Administration of the Mortgage Loans............................................................................65
3.02. Collection of Mortgage Loan Payments............................................................................66
3.03. Collection of Taxes, Assessments and Similar Items;
Servicing Accounts; Reserve Accounts..........................................................................66
3.04. Collection Account and Distribution Account.....................................................................68
3.05. Permitted Withdrawals From the Collection Account and the Distribution Account..................................70
3.06. Investment of Funds in the Collection Account, Servicing Accounts,
Reserve Accounts and the REO Account..........................................................................74
3.07. Maintenance of Insurance Policies; Errors and Omissions and Fidelity Coverage...................................75
3.08. Enforcement of Alienation Clauses...............................................................................77
3.09. Realization Upon Defaulted Mortgage Loans.......................................................................78
3.10. Trustee to Cooperate; Release of Mortgage Files.................................................................81
3.11. Servicing and Special Servicing Compensation; Interest on and
Reimbursement of Servicing Advances; Payment of Certain Expenses;
Obligations of the Trustee and any Fiscal Agent regarding Back-up Servicing Advances..........................82
3.12. Property Inspections; Collection of Financial Statements; Delivery of Certain Reports...........................87
3.13. Annual Statement as to Compliance...............................................................................88
3.14. Reports by Independent Public Accountants.......................................................................88
3.15. Access to Certain Information...................................................................................89
3.16. Title to REO Property; REO Account..............................................................................89
3.17. Management of REO Property......................................................................................90
3.18. Sale of Mortgage Loans and REO Properties.......................................................................93
3.19. Additional Obligations of Servicer..............................................................................96
3.20. Modifications, Waivers, Amendments and Consents.................................................................98
3.21. Transfer of Servicing Between Servicer and Special Servicer; Record Keeping....................................101
3.22. Sub-Servicing Agreements.......................................................................................102
3.23. Controlling Class Representative...............................................................................104
3.24. Certain Rights and Powers of the Controlling Class Representative..............................................106
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
4.01. Distributions..................................................................................................109
4.02. Statements to Certificateholders; Certain Other Reports........................................................119
4.03. P&I Advances; Advances relating to the Servicer Remittance Amount..............................................122
4.04. Allocation of Realized Losses and Additional Trust Fund Expenses...............................................124
4.05. Calculations...................................................................................................125
</TABLE>
-iii-
<PAGE>
<TABLE>
<CAPTION>
Section Page
- - ------- ----
<S> <C>
ARTICLE V
THE CERTIFICATES
5.01. The Certificates...............................................................................................126
5.02. Registration of Transfer and Exchange of Certificates..........................................................126
5.03. Book-Entry Certificates........................................................................................132
5.04. Mutilated, Destroyed, Lost or Stolen Certificates..............................................................133
5.05. Persons Deemed Owners..........................................................................................133
5.06. Certification by Certificate Owners............................................................................133
5.07. Required Regulatory Repurchase.................................................................................134
ARTICLE VI
THE DEPOSITOR, THE SERVICER,
THE SPECIAL SERVICER AND THE REMIC ADMINISTRATOR
6.01. Liability of the Depositor, the Servicer, the Special Servicer
and the REMIC Administrator..................................................................................135
6.02. Merger, Consolidation or Conversion of the Depositor,
the Servicer, the Special Servicer or the REMIC Administrator................................................135
6.03. Limitation on Liability of the Depositor, the Servicer,
the Special Servicer and the REMIC Administrator.............................................................135
6.04. Servicer, Special Servicer and REMIC Administrator Not to Resign...............................................136
6.05. Rights of the Depositor and the Trustee in Respect of the Servicer,
the Special Servicer and the REMIC Administrator.............................................................137
6.06. Designation of Special Servicer by the Controlling Class.......................................................138
6.07. Servicer or Special Servicer as Owner of a Certificate.........................................................138
ARTICLE VII
DEFAULT
7.01. Events of Default..............................................................................................140
7.02. Trustee to Act; Appointment of Successor.......................................................................143
7.03. Notification to Certificateholders.............................................................................144
7.04. Waiver of Events of Default....................................................................................144
7.05. Additional Remedies of Trustee Upon Event of Default...........................................................145
</TABLE>
-iv-
<PAGE>
<TABLE>
<CAPTION>
Section Page
- - ------- ----
<S> <C>
ARTICLE VIII
THE TRUSTEE
8.01. Duties of Trustee..............................................................................................146
8.02. Certain Matters Affecting the Trustee..........................................................................147
8.03. Trustee and Fiscal Agent not Liable for Validity or Sufficiency of
Certificates or Mortgage Loans...............................................................................148
8.04. Trustee and Fiscal Agent May Own Certificates..................................................................149
8.05. Fees and Expenses of Trustee; Indemnification of and
by Trustee, REMIC Administrator and Fiscal Agent.............................................................149
8.06. Eligibility Requirements for Trustee...........................................................................150
8.07. Resignation and Removal of Trustee.............................................................................151
8.08. Successor Trustee..............................................................................................152
8.09. Merger or Consolidation of Trustee.............................................................................153
8.10. Appointment of Co-Trustee or Separate Trustee..................................................................153
8.11. Appointment of Custodians......................................................................................154
8.12. Access to Certain Information..................................................................................154
8.13. Appointment of Fiscal Agent....................................................................................156
8.14 Advance Security Arrangement...................................................................................157
8.15. Filings with the Securities and Exchange Commission............................................................157
ARTICLE IX
TERMINATION
9.01. Termination Upon Repurchase or Liquidation of All Mortgage Loans...............................................158
9.02. Additional Termination Requirements............................................................................159
ARTICLE X
ADDITIONAL REMIC PROVISIONS
10.01. REMIC Administration...........................................................................................161
10.02. Depositor, Servicer, Special Servicer, Trustee and Fiscal Agent to
Cooperate with REMIC Administrator...........................................................................163
10.03. Fees of the REMIC Administrator................................................................................164
10.04. Use of Agents..................................................................................................164
</TABLE>
-v-
<PAGE>
<TABLE>
<CAPTION>
Section Page
- - ------- ----
<S> <C>
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.01. Amendment......................................................................................................165
11.02. Recordation of Agreement; Counterparts.........................................................................166
11.03. Limitation on Rights of Certificateholders.....................................................................166
11.04. Governing Law..................................................................................................167
11.05. Notices........................................................................................................167
11.06. Severability of Provisions.....................................................................................168
11.07. Successors and Assigns; Beneficiaries..........................................................................168
11.08. Article and Section Headings...................................................................................168
11.09. Notices to and from the Rating Agencies........................................................................168
11.10. Reports by Trustee to Gaming Authorities.......................................................................170
11.11. Complete Agreement.............................................................................................171
</TABLE>
-vi-
<PAGE>
EXHIBITS
EXHIBIT A-1 Form of Class CP and Class S Certificates
EXHIBIT A-2 Form of Class A-1A and Class A-1B Certificates
EXHIBIT A-3 Form of Class A-2, Class A-3, Class B-1 and Class B-2
Certificates
EXHIBIT A-4 Form of Class B-3, Class B-4, Class B-5, Class B-6,
Class B-7 and Class C Certificates
EXHIBIT A-5 Form of Class R-I, Class R-II and Class R-III Certificates
EXHIBIT B-1 Mortgage Loan Schedule
EXHIBIT B-2 Schedule of Exceptions to Mortgage File Delivery
EXHIBIT C Letter of Representations among Depositor, Trustee and
initial Depository
EXHIBIT D-1 Form of Servicer Request for Release
EXHIBIT D-2 Form of Special Servicer Request for Release
EXHIBIT E-1 Form of Trustee Report
EXHIBIT E-2 Form of Determination Date Report
EXHIBIT E-3 Form of Special Servicer Report
EXHIBIT E-4 Form of Portfolio Performance Report
EXHIBIT E-5 Form of Operating Statement Analysis
EXHIBIT E-6 Form of Watch List
EXHIBIT F-1A Form I of Transferor Certificate for Transfers of
Non-Registered Certificates
EXHIBIT F-1B Form II of Transferor Certificate for Transfers of
Non-Registered Certificates
EXHIBIT F-2A Form I of Transferee Certificate for Transfers of
Non-Registered Certificates
EXHIBIT F-2B Form II of Transferee Certificate for Transfers of
Non-Registered Certificates
EXHIBIT G Form of Transferee Certificate in Connection with ERISA
(Definitive Subordinated Certificates)
EXHIBIT H-1 Form of Transfer Affidavit and Agreement for Transfers
of Residual Interest Certificates
EXHIBIT H-2 Form of Transferor Certificate for Transfers of Residual
Interest Certificates
EXHIBIT I-1 Form of Notice and Acknowledgment Concerning Replacement
of Special Servicer
EXHIBIT I-2 Form of Acknowledgment of Proposed Special Servicer
EXHIBIT J Form of UCC-1 Financing Statement
EXHIBIT K Calculation of Net Operating Income
EXHIBIT L-1 Information Request from Certificateholder or
Certificate Owner
EXHIBIT L-2 Information Request from Prospective Investor
EXHIBIT M Form of Mortgage Loan Purchase and Sale Agreement
EXHIBIT N-1 Form of Third Party Originator Agreement with ARCS
EXHIBIT N-2 Form of Third Party Originator Agreement with Union
Capital
-vii-
<PAGE>
This Pooling and Servicing Agreement, is dated and effective as of March 1,
1998, among DLJ COMMERCIAL MORTGAGE CORP. as Depositor, BANC ONE MORTGAGE
CAPITAL MARKETS, LLC as Servicer, CLARION PARTNERS, LLC as Special Servicer, and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION as Trustee and REMIC Administrator.
PRELIMINARY STATEMENT:
The Seller (as defined herein) has sold to the Depositor, pursuant to the
Mortgage Loan Purchase and Sale Agreement dated as of February 20, 1998 (the
"Mortgage Loan Purchase and Sale Agreement"), between the Seller and the
Depositor, those Mortgage Loans (as defined herein) identified as of the date
hereof on the schedule attached hereto as Exhibit B-1. A form of the Mortgage
Loan Purchase and Sale Agreement is attached hereto as Exhibit M.
The parties hereto desire to provide for, among other things, (i) the
creation of a common law trust, (ii) the transfer of the Mortgage Loans
identified as of the date hereof on the schedule attached hereto as Exhibit B-1,
together with certain related rights, funds and property, by the Depositor to
the Trustee for the benefit of the Certificateholders (as defined herein), (iii)
the issuance of mortgage pass-through certificates in multiple classes, which in
the aggregate will evidence the entire beneficial ownership interest in the
trust fund to be created hereunder, and (iv) the servicing and administration of
the Mortgage Loans and other assets that from time to time shall constitute the
trust fund to be created hereunder.
In consideration of the mutual agreements herein contained, the parties
hereto agree as follows:
-1-
<PAGE>
ARTICLE I
DEFINITIONS; GENERAL INTERPRETIVE PRINCIPLES;
CERTAIN CALCULATIONS IN RESPECT
OF THE MORTGAGE POOL
SECTION 1.01. Defined Terms.
Whenever used in this Agreement, including in the Preliminary Statement,
the following words and phrases, unless the context otherwise requires, shall
have the meanings specified in this Section 1.01, subject to modification in
accordance with Section 1.04.
"Accrued Certificate Interest": The interest accrued from time to time in
respect of any Class of Regular Interest Certificates, calculated in accordance
with Section 2.14(g).
"Accrued Component Interest": The interest accrued from time to time in
respect of any Class CP REMIC III Regular Interest or Class S REMIC III Regular
Interest, in each such case calculated in accordance with Section 2.14(f).
"Acquisition Date": With respect to any REO Property, the first day on
which such REO Property is considered to be acquired by the Trust within the
meaning of Treasury regulation Section 1.856- 6(b)(1), which is the first day on
which the Trust is treated as the owner of such REO Property for federal income
tax purposes.
"Additional Collateral": Any non-real property pledged by the related
Mortgagor and held by the mortgagee to secure payment on any Mortgage Loan.
"Additional Interest": With respect to any ARD Loan after its Anticipated
Repayment Date, all interest accrued on the principal balance of such ARD Loan
at the Additional Interest Rate (the payment of which interest shall, under the
terms of such Mortgage Loan, be deferred until the principal balance of such
Mortgage Loan has been paid in full), together with all interest, if any,
accrued at the related Mortgage Rate on such deferred interest.
"Additional Interest Rate": With respect to any ARD Loan after its
Anticipated Repayment Date, the incremental increase in the Mortgage Rate for
such Mortgage Loan resulting from the passage of such Anticipated Repayment
Date.
"Additional Servicing Compensation": As defined in Section 3.11(b).
"Additional Special Servicing Compensation": As defined in Section 3.11(d).
"Additional Trust Fund Expense": Any expense experienced with respect to
the Trust Fund and not otherwise included in the calculation of a Realized Loss
that would result in the Regular Interest Certificateholders' receiving less
than the full amount of principal and/or interest to which they are entitled on
any Distribution Date.
-2-
<PAGE>
"Advance": Any P&I Advance or Servicing Advance.
"Advance Interest": Interest accrued on any Advance at the Reimbursement
Rate and payable to the Servicer, the Special Servicer, the Trustee or any
Fiscal Agent, as the case may be, all in accordance with Section 3.11(g) or
Section 4.03(e), as applicable.
"Advance Security Arrangement": As defined in Section 8.14.
"Adverse Rating Event": With respect to any Class of Rated Certificates and
each Rating Agency that has assigned a rating thereto, as of any date of
determination, the qualification, downgrade or withdrawal of the rating then
assigned to such Class of Rated Certificates by such Rating Agency.
"Adverse REMIC Event": Either (i) the endangerment of the status of any
REMIC Pool as a REMIC or (ii) except as permitted by Section 3.17(a), the
imposition of a tax upon any REMIC Pool or any of its assets or transactions
(including the tax on prohibited transactions as defined in Section 860F(a)(2)
of the Code and the tax on prohibited contributions set forth in Section 860G(d)
of the Code).
"Affiliate": With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement together with all
amendments hereof and supplements hereto.
"A.M. Best": A.M. Best Company or its successor in interest.
"Annual Accountants' Report": As defined in Section 3.14.
"Annual Performance Certification": As defined in Section 3.13.
"Anticipated Repayment Date": With respect to any ARD Loan, the date
specified on the related Mortgage Note, as of which Additional Interest shall
begin to accrue on such Mortgage Loan, which date is prior to the Stated
Maturity Date for such Mortgage Loan.
"Appraisal": With respect to any Mortgaged Property or REO Property as to
which an appraisal is required to be performed pursuant to the terms of this
Agreement, a narrative appraisal complying with USPAP (or, in the case of a
Mortgage Loan or an REO Mortgage Loan with a Stated Principal Balance as of the
date of such appraisal of $1,000,000 or less, a limited appraisal and a summary
report) that (i) indicates the "market value" of the subject property (within
the meaning of 12 CFR ss.225.62(g)) and (ii) is conducted by a Qualified
Appraiser.
"Appraisal Reduction Amount": With respect to any Required Appraisal Loan,
an amount (calculated as of the Determination Date immediately following the
later of (a) the date on which the most recent relevant Appraisal acceptable for
purposes of Section 3.19(c) hereof was obtained by the Special Servicer pursuant
to this Agreement and (b) the earliest of the relevant dates in respect of such
Required
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Appraisal Loan specified in the first sentence of Section 3.19(c) hereof) equal
to the excess, if any, of (x) the sum of (i) the Stated Principal Balance of
such Required Appraisal Loan, (ii) to the extent not previously advanced by or
on behalf of the Servicer, the Trustee or any Fiscal Agent, all accrued and
unpaid interest on such Required Appraisal Loan at the related Mortgage Rate
through the most recent Due Date prior to such Determination Date (net of
related Servicing Fees and, in the case of an ARD Loan, after its Anticipated
Repayment Date, net of related Additional Interest), (iii) all accrued but
unpaid Servicing Fees and Special Servicing Fees in respect of such Required
Appraisal Loan, (iv) all related unreimbursed Advances made by or on behalf of
the Servicer, the Special Servicer, the Trustee or any Fiscal Agent in respect
of such Required Appraisal Loan, together with all unpaid Advance Interest
accrued on such Advances, and (v) all currently due but unpaid real estate taxes
and assessments, insurance premiums, and if applicable, ground rents in respect
of the related Mortgaged Property or REO Property (net of any Escrow Payments or
other reserves held by the Servicer or the Special Servicer with respect to any
such item), over (y) 90% of an amount equal to (i) the Appraised Value of the
related Mortgaged Property or REO Property, as applicable, as determined by the
most recent relevant Appraisal acceptable for purposes of Section 3.19(c)
hereof, net of (ii) the amount of any mortgage liens on such Mortgaged Property
or REO Property, as applicable, that are prior to the lien of the Required
Appraisal Loan. Notwithstanding the foregoing, if in the case of any Required
Appraisal Loan an Appraisal acceptable for purposes of Section 3.19(c) hereof is
not obtained within 90 days following the earliest of the relevant dates in
respect of such Required Appraisal Loan specified in the first sentence of
Section 3.19(c) hereof, then until such Appraisal is obtained the Appraisal
Reduction Amount will equal 30% of the Stated Principal Balance of such Required
Appraisal Loan; provided, however, that upon receipt of an Appraisal acceptable
for purposes of Section 3.19(c) hereof, the Appraisal Reduction Amount for such
Required Appraisal Loan will be recalculated in accordance with the preceding
sentence.
"Appraised Value": With respect to each Mortgaged Property or REO Property,
the appraised value thereof (as is) based upon the most recent Appraisal
obtained pursuant to this Agreement but in no event based upon an Appraisal more
than 12 months old.
"Approved Summary Business Plan": As defined in Section 3.24(a).
"ARCS": ARCS Commercial Mortgage Co., L.P. or its successor in interest.
"ARD Loan": A Mortgage Loan that provides for, if such Mortgage Loan is not
paid in full on or prior to its Anticipated Repayment Date, (i) the accrual of
Additional Interest thereon and (ii) except in the case of the Mortgage Loans
identified on the Mortgage Loan Schedule by loan numbers 45 through 50, the
application (in reduction of the outstanding principal of such Mortgage Loan) of
an amount (in addition to the principal portion of the required Monthly Payment)
equal to the excess (if any) of certain net cash flow from the related Mortgaged
Property over the related Monthly Payment.
"Assignment of Leases": With respect to any Mortgaged Property, any
assignment of leases, rents and profits or similar document or instrument
executed by the related Mortgagor in connection with the origination of the
related Mortgage Loan, as such assignment may be amended, modified, renewed or
extended through the date hereof and from time to time hereafter.
"Assumed Monthly Payment": With respect to any Balloon Mortgage Loan
delinquent in respect of its Balloon Payment, for each Due Date coinciding with
or following its most recent scheduled maturity date (including the related
Stated Maturity Date or any extended maturity date) as of which such Mortgage
Loan remains outstanding and part of the Trust Fund (provided that such Mortgage
Loan was not
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paid in full, and no other Liquidation Event occurred in respect thereof, before
the end of the Collection Period in which such maturity date occurs), the
scheduled monthly payment of principal and/or interest deemed to be due in
respect of such Mortgage Loan on such Due Date equal to the amount that would
have been due in respect thereof on such Due Date if such Mortgage Loan had been
required to continue to accrue interest (exclusive, however, in the case of an
ARD Loan after its Anticipated Repayment Date, of Additional Interest) in
accordance with its terms, and to pay principal in accordance with the
amortization schedule (if any) in effect immediately prior to, and without
regard to the occurrence of, such maturity date. With respect to any REO
Mortgage Loan, for any Due Date as of which the related REO Property remains
part of the Trust Fund, the scheduled monthly payment of principal and/or
interest deemed to be due in respect thereof on such Due Date equal to the
Monthly Payment (or, in the case of a Balloon Mortgage Loan described in the
preceding sentence of this definition, the Assumed Monthly Payment) that was due
(or deemed due) in respect of the related Mortgage Loan on the last Due Date
prior to its becoming an REO Mortgage Loan.
"Available Distribution Amount": With respect to any Distribution Date, an
amount equal to (a) all amounts on deposit in the Distribution Account as of
11:00 a.m., New York City time, on such Distribution Date, together with
(without duplication) any P&I Advances and/or Compensating Interest Payments
that were made on and in respect of such Distribution Date, net of (b) any
portion of the amounts described in clause (a) of this definition that
represents one or more of the following: (i) collected Monthly Payments that are
due on a Due Date following the end of the related Collection Period, (ii) any
payments of principal (including Principal Prepayments) and interest,
Liquidation Proceeds and Insurance Proceeds received after the end of the
related Collection Period, (iii) Prepayment Premiums and Yield Maintenance
Premiums (except to the extent that they constitute part of the Special
Principal Distribution Amount for such Distribution Date), (iv) any amounts
payable or reimbursable to any Person from the Distribution Account pursuant to
clauses (ii) through (v) of Section 3.05(b), and (v) any amounts deposited in
the Distribution Account in error; provided that the Available Distribution
Amount for the Final Distribution Date shall be calculated without regard to
clauses (b)(i) and (b)(ii) of this definition.
"Balloon Mortgage Loan": Any Mortgage Loan that by its original terms or by
virtue of any modification entered into as of the Closing Date (or, in the case
of a Replacement Mortgage Loan, as of the related date of substitution) provides
for an amortization schedule extending beyond its Stated Maturity Date and as to
which, in accordance with such terms, a Balloon Payment is due on its Stated
Maturity Date.
"Balloon Payment": Any Monthly Payment payable on a Mortgage Loan at
scheduled maturity that is at least twice as large as the normal Monthly Payment
due on such Mortgage Loan.
"Bankruptcy Code": The federal Bankruptcy Code, as amended from time to
time (Title 11 of the United States Code).
"Base Prospectus": That certain prospectus dated February 17, 1998,
relating to trust funds established by the Sponsor and publicly offered mortgage
pass-through certificates evidencing interests therein.
"Book-Entry Certificate": Any Certificate registered in the name of the
Depository or its nominee.
"Book-Entry Subordinated Certificate": Any Subordinated Certificate that
constitutes a Book-Entry Certificate.
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"Breach": As defined in Section 2.03(a).
"Business Day": Any day other than a Saturday, a Sunday or a day on which
banking institutions in New York, New York, Minneapolis, Minnesota, either of
the cities in which the Primary Servicing Offices of the Servicer and the
Special Servicer are located or the city in which the Corporate Trust Office of
the Trustee is located, are authorized or obligated by law or executive order to
remain closed.
"CCC": The New Jersey Casino Control Commission or its successor.
"CERCLA": The Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
"Certificate": Any one of the Depositor's Commercial Mortgage Pass-Through
Certificates, Series 1998-CF1, as executed by the Trustee and authenticated and
delivered hereunder by the Certificate Registrar.
"Certificate Factor": With respect to any Class of Regular Interest
Certificates, as of any date of determination, a fraction, expressed as a
decimal carried to eight places, the numerator of which is the related Class
Principal Balance or Class Notional Amount, as the case may be, then
outstanding, and the denominator of which is the related Class Principal Balance
or Class Notional Amount, as the case may be, outstanding as of the Closing
Date.
"Certificateholder" or "Holder": The Person in whose name a Certificate is
registered in the Certificate Register, provided, however, that: (i) neither a
Disqualified Organization nor a Non-United States Person shall be a "Holder" of,
or a "Certificateholder" with respect to, a Residual Interest Certificate for
any purpose hereof; and (ii) solely for purposes of giving any consent, approval
or waiver pursuant to this Agreement that specifically relates to the rights,
duties and/or obligations hereunder of any of the Depositor, the Servicer, the
Special Servicer, the REMIC Administrator, the Trustee or any Fiscal Agent in
its respective capacity as such (other than any consent, approval or waiver
contemplated by any of Sections 3.23, 3.24 and 6.06), any Certificate registered
in the name of such party or in the name of any Affiliate thereof shall be
deemed not to be outstanding, and the Voting Rights to which it is entitled
shall not be taken into account in determining whether the requisite percentage
of Voting Rights necessary to effect any such consent, approval or waiver that
specifically relates to such party has been obtained. The Certificate Registrar
shall be entitled to request and conclusively rely upon a certificate of the
Depositor, the Servicer or the Special Servicer in determining whether a
Certificate is registered in the name of an Affiliate of such Person. All
references herein to "Certificateholders" or "Holders" shall reflect the rights
of Certificate Owners only insofar as they may indirectly exercise such rights
through the Depository and the Depository Participants (except as otherwise
specified herein), it being herein acknowledged and agreed that the parties
hereto shall be required to recognize as a "Certificateholder" or "Holder" only
the Person in whose name a Certificate is registered in the Certificate
Register.
"Certificateholder Reports": Collectively, the Trustee Report, the
Portfolio Performance Report, the Watch List and all the Operating Statement
Analyses.
"Certificate Notional Amount": With respect to any Interest Only
Certificate, the hypothetical or notional principal amount on which such
Certificate accrues interest from time to time, which, as of any date of
determination, is equal to the product of (a) the then Certificate Factor for
the Class of Certificates
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to which such Certificate belongs, multiplied by (b) the amount specified on the
face of such Certificate as the initial Certificate Notional Amount thereof.
"Certificate Owner": With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Certificate as reflected on the books of the
Depository or on the books of a Depository Participant or on the books of an
indirect participating brokerage firm for which a Depository Participant acts as
agent.
"Certificate Principal Balance": With respect to any Sequential Pay
Certificate, as of any date of determination, the then outstanding principal
amount of such Certificate equal to the product of (a) the then Certificate
Factor for the Class of Sequential Pay Certificates to which such Certificate
belongs, multiplied by (b) the amount specified on the face of such Certificate
as the initial Certificate Principal Balance thereof.
"Certificate Register": The register maintained pursuant to Section 5.02.
"Certificate Registrar": The registrar appointed pursuant to Section 5.02.
"Class": Collectively, all of the Certificates bearing the same
alphabetical and, if applicable, numerical class designation and having the same
payment terms. The respective Classes of Certificates are designated in Section
2.09(a). Any reference in any other Section or Subsection of this Agreement to
any Certificate or Certificates preceded by a Class designation shall be to a
Certificate or Certificates of the Class so designated in Section 2.09(a).
"Class A Certificate": Any of the Certificates designated as such in
Section 2.09.
"Class B Certificate": Any of the Certificates designated as such in
Section 2.09.
"Class CP REMIC III Regular Interest": As defined in Section 2.14(b).
"Class CP Strip Rate": As defined in Section 2.14(d).
"Class Notional Amount": As defined in Section 2.14(d).
"Class Principal Balance": As defined in Section 2.14(e).
"Class S REMIC III Regular Interest": As defined in Section 2.14(b).
"Class S Strip Rate": As defined in Section 2.14(d).
"Closing Date": March 2, 1998.
"Code": The Internal Revenue Code of 1986.
"Collection Account": The segregated account or accounts created and
maintained by the Servicer pursuant to Section 3.04(a) in trust for the
Certificateholders, which shall be entitled "Banc One
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Mortgage Capital Markets, LLC, as Servicer, in trust for the registered holders
of DLJ Commercial Mortgage Corp., Commercial Mortgage Pass-Through Certificates,
Series 1998-CF1".
"Collection Period": With respect to any Distribution Date, the period
commencing immediately following the Determination Date in the calendar month
preceding the month in which such Distribution Date occurs (or, in the case of
the initial Distribution Date, commencing immediately following the Cut-off
Date) and ending on and including the Determination Date in the calendar month
in which such Distribution Date occurs.
"Commission": The Securities and Exchange Commission or any successor
thereto.
"Compensating Interest Payment": With respect to any Distribution Date, any
payment made by the Servicer pursuant to Section 3.19(a) to cover Prepayment
Interest Shortfalls incurred during the related Collection Period.
"Component Notional Amount": As defined in Section 2.14(b).
"Control Act": The New Jersey Casino Control Act, as amended.
"Controlling Class": As of any date of determination, the Class of
Sequential Pay Certificates with the lowest payment priority pursuant to Section
4.01(a), that has a then outstanding Class Principal Balance that is not less
than 25% (or, in the case of the Class C Certificates, 20%) of its initial Class
Principal Balance; provided that, if no Class of Sequential Pay Certificates has
a Class Principal Balance that satisfies the foregoing requirement, then the
Controlling Class shall be the Class of Sequential Pay Certificates with the
largest Class Principal Balance then outstanding. For purposes of this
definition, the Class A-1A and Class A-1B Certificates shall be treated as a
single Class and, if appropriate under the terms of this definition, shall
collectively constitute the Controlling Class.
"Controlling Class Representative": As defined in Section 3.23(a).
"Corporate Trust Office": The principal corporate trust office of the
Trustee at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of the
execution of this Agreement is located at 11000 Broken Land Parkway, Columbia,
Maryland 21044-3562.
"Corrected Mortgage Loan": Any Mortgage Loan that had been a Specially
Serviced Mortgage Loan but has ceased to be such in accordance with the
definition of "Specially Serviced Mortgage Loan" (other than by reason of a
Liquidation Event occurring in respect of such Mortgage Loan or the related
Mortgaged Property becoming an REO Property).
"Corresponding REMIC II Regular Interest": With respect to any Class of
Sequential Pay Certificates (other than the Class A-1B Certificates), the REMIC
II Regular Interest that has an alphabetical and, if applicable, numerical
designation that is the same as the alphabetical and, if applicable, numerical
Class designation for such Class of Sequential Pay Certificates; with respect to
the Class A-1B Certificates, REMIC II Regular Interests A-1B1 and A-1B2,
collectively; with respect to any Class CP REMIC III Regular Interest, the REMIC
II Regular Interest that has an alphabetical and, if applicable, numerical
designation that, when preceded by "CP-", is the same as the alphabetical and,
if applicable, numerical designation for such
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Class CP REMIC III Regular Interest; and, with respect to any Class S REMIC III
Regular Interest, the REMIC II Regular Interest that has an alphabetical and, if
applicable, numerical designation that, when preceded by "S-", is the same as
the alphabetical and, if applicable, numerical designation for such Class S
REMIC III Regular Interest.
"Cross-Collateralized Group": Any group of Mortgage Loans that is
cross-defaulted and cross-collateralized with each other.
"Cross-Collateralized Mortgage Loan": Any Mortgage Loan that pursuant to
Section 1.04 is deemed to be, or by its terms actually is, cross-defaulted and
cross-collateralized with any other Mortgage Loan.
"Custodian": A Person who is at any time appointed by the Trustee pursuant
to Section 8.11 as a document custodian for the Mortgage Files.
"Cut-off Date": March 1, 1998.
"Cut-off Date Balance": With respect to any Original Mortgage Loan, the
outstanding principal balance of such Mortgage Loan as of the Cut-off Date,
after application of all payments of principal due on or before such date,
whether or not received.
"Debt Service Coverage Ratio": With respect to any Mortgage Loan, as of any
date of determination, and without regard to the cross-collateralization in the
case of any Cross-Collateralized Mortgage Loan, the ratio of (x) the Net
Operating Income (before payment of any debt service on such Mortgage Loan)
generated by the related Mortgaged Property during the most recent period of not
more than twelve months or less than three months for which Net Operating Income
can be calculated (annualized if such period is less than twelve months), to (y)
twelve times the amount of the Monthly Payment in effect for such Mortgage Loan
as of such date of determination.
"Default Charges": Default Interest and/or late payment charges that are
paid or payable, as the context may require, in respect of any Mortgage Loan or
REO Mortgage Loan.
"Defaulted Mortgage Loan": A Specially Serviced Mortgage Loan (i) that is
delinquent in an amount equal to at least two Monthly Payments (not including
the Balloon Payment, if any) or is delinquent thirty (30) days or more in
respect of its Balloon Payment, in either case such delinquency to be determined
without giving effect to any grace period permitted by the related Mortgage or
Mortgage Note and without regard to any acceleration of payments under the
related Mortgage and Mortgage Note, or (ii) as to which the Special Servicer
has, by written notice to the related Mortgagor, accelerated the maturity of the
indebtedness evidenced by the related Mortgage Note.
"Defaulting Party": As defined in Section 7.01(b).
"Default Interest": With respect to any Mortgage Loan (or successor REO
Mortgage Loan), any amounts collected thereon, other than late payment charges,
Prepayment Premiums or Yield Maintenance Premiums, that represent penalty
interest in excess of interest on the principal balance of such Mortgage Loan
(or successor REO Mortgage Loan) accrued at the related Mortgage Rate.
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"Definitive Certificate": As defined in Section 5.03(a).
"Deleted Mortgage Loan": A Mortgage Loan which is repurchased from the
Trust or as to which one or more Replacement Mortgage Loans are substituted, in
either case as contemplated by Section 2.03.
"Depositor": DLJ Commercial Mortgage Corp. or its successor in interest.
"Depository": The Depository Trust Company, or any successor Depository
hereafter named as contemplated by Section 5.03(c). The nominee of the initial
Depository for purposes of registering those Certificates that are to be
Book-Entry Certificates, is Cede & Co. The Depository shall at all times be a
"clearing corporation" as defined in Section 8-102(3) of the Uniform Commercial
Code of the State of New York and a "clearing agency" registered pursuant to the
provisions of Section 17A of the Exchange Act.
"Depository Participant": A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date, the earlier of
(i) the 10th day of the calendar month in which such Distribution Date occurs
(or, if such 10th day is not a Business Day, the immediately preceding Business
Day) and (ii) the fifth Business Day preceding such Distribution Date.
"Determination Date Report": As defined in Section 4.02(b).
"Directly Operate": With respect to any REO Property, the furnishing or
rendering of services to the tenants thereof, the management or operation of
such REO Property, the holding of such REO Property primarily for sale to
customers, the performance of any construction work thereon or any use of such
REO Property in a trade or business conducted by the Trust other than through an
Independent Contractor; provided, however, that the Special Servicer (or any
Sub-Servicer on behalf of the Special Servicer) shall not be considered to
Directly Operate an REO Property solely because the Special Servicer (or any
Sub-Servicer on behalf of the Special Servicer) establishes rental terms,
chooses tenants, enters into or renews leases, deals with taxes and insurance,
or makes decisions as to repairs or capital expenditures with respect to such
REO Property.
"Discount Rate": As defined in Section 4.01(b).
"Disqualified Organization": Any of the following: (i) the United States or
a possession thereof, any State or any political subdivision thereof, or any
agency or instrumentality of any of the foregoing (other than an instrumentality
which is a corporation if all of its activities are subject to tax and, except
for FHLMC, a majority of its board of directors is not selected by any such
governmental unit), (ii) a foreign government, international organization, or
any agency or instrumentality of either of the foregoing, (iii) any organization
(except certain farmers' cooperatives described in Section 521 of the Code)
which is exempt from the tax imposed by Chapter 1 of the Code (unless such
organization is subject to the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381 of the Code or (v) any other Person so
designated by the REMIC Administrator based upon an Opinion of Counsel that the
holding of an Ownership Interest in a Residual Interest Certificate by such
Person may cause the Trust or any Person having an Ownership Interest in any
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Class of Certificates, other than such Person, to incur a liability for any
federal tax imposed under the Code that would not otherwise be imposed but for
the Transfer of an Ownership Interest in a Residual Interest Certificate to such
Person. The terms "United States", "State" and "international organization"
shall have the meanings set forth in Section 7701 of the Code or successor
provisions.
"Distributable Certificate Interest": With respect to any Class of Regular
Interest Certificates, for any Distribution Date, an amount of interest equal to
all Accrued Certificate Interest in respect of such Class of Regular Interest
Certificates for the related Interest Accrual Period, reduced (to not less than
zero) by the product of (i) any Net Aggregate Prepayment Interest Shortfall for
such Distribution Date, multiplied by (ii) a fraction, expressed as a decimal,
the numerator of which is the Accrued Certificate Interest in respect of such
Class of Regular Interest Certificates for the related Interest Accrual Period,
and the denominator of which is the aggregate Accrued Certificate Interest in
respect of all the Classes Regular Interest Certificates for the related
Interest Accrual Period.
"Distributable Component Interest": With respect to any Class CP REMIC III
Regular Interest or any Class S REMIC III Regular Interest, for any Distribution
Date, an amount of interest equal to all Accrued Component Interest in respect
of such Class CP REMIC III Regular Interest or such Class S REMIC III Regular
Interest, as the case may be, for the related Interest Accrual Period, reduced
(to not less than zero) by the product of (i) any Net Aggregate Prepayment
Interest Shortfall for such Distribution Date, multiplied by (ii) a fraction,
expressed as a decimal, the numerator of which is the Accrued Component Interest
in respect of such Class CP REMIC III Regular Interest or such Class S REMIC III
Regular Interest, as the case may be, for the related Interest Accrual Period,
and the denominator of which is the aggregate Accrued Certificate Interest in
respect of all the Regular Interest Certificates for the related Interest
Accrual Period.
"Distribution Account": The segregated account or accounts created and
maintained by the Trustee pursuant to Section 3.04(b) in trust for the
Certificateholders, which shall be entitled "Norwest Bank Minnesota, National
Association, as Trustee, in trust for the registered holders of DLJ Commercial
Mortgage Corp., Commercial Mortgage Pass-Through Certificates, Series 1998-CF1."
"Distribution Date": The 15th day of any month (or, if such 15th day is not
a Business Day, the Business Day immediately following), commencing in April
1998.
"Document Defect": As defined in Section 2.02(e).
"Due Date": With respect to any Mortgage Loan (and any successor REO
Mortgage Loan), the day of the month set forth in the related Mortgage Note on
which each Monthly Payment on such Mortgage Loan is scheduled to be first due.
"Eligible Account": Any of (i) an account maintained with a federal or
state chartered depository institution or trust company, the long-term deposit
or long-term unsecured debt obligations of which (or of such institution's
parent holding company) are rated no less than "AA" by each of S&P and Fitch (if
then rated by Fitch) and "Aa2" by Moody's (if the deposits are to be held in the
account for more than 30 days), or the short-term deposit or short-term
unsecured debt obligations of which (or of such institution's parent holding
company) are rated no less than "A-1" by S&P, "F-1+" by Fitch (if then rated by
Fitch) and "P-1" by Moody's (if the deposits are to be held in the account for
30 days or less), in any event at any time funds are on deposit therein, or (ii)
a segregated trust account maintained with a federal or state chartered
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depository institution or trust company acting in its fiduciary capacity, which,
in the case of a state chartered depository institution or trust company is
subject to regulations regarding fiduciary funds on deposit therein
substantially similar to 12 CFR ss. 9.10(b), and which, in either case, has a
combined capital and surplus of at least $50,000,000 and is subject to
supervision or examination by federal or state authority, or (iii) any other
account that is acceptable to the Rating Agencies (as evidenced by written
confirmation to the Trustee from each Rating Agency that the use of such account
would not, in and of itself, result in an Adverse Rating Event with respect to
any Class of Rated Certificates).
"ERISA": The Employee Retirement Income Security Act of 1974, as amended.
"Escrow Payment": Any payment received by the Servicer or the Special
Servicer for the account of any Mortgagor for application toward the payment of
real estate taxes, assessments, insurance premiums, ground rents (if applicable)
and similar items in respect of the related Mortgaged Property.
"Event of Default": Any of the events described in Section 7.01(a).
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"FDIC": The Federal Deposit Insurance Corporation or any successor.
"FHLMC": The Federal Home Loan Mortgage Corporation or any successor.
"Final Distribution Date": The final Distribution Date on which any
distributions are to be made on the Certificates as contemplated by Section
9.01.
"Final Recovery Determination": A determination made by the Special
Servicer, in its reasonable, good faith judgment, with respect to any Mortgage
Loan or REO Property (other than a Mortgage Loan that is paid in full and other
than a Mortgage Loan or REO Property, as the case may be, that is repurchased or
replaced by a Third Party Originator pursuant to the related Third Party
Originator Agreement, repurchased or replaced by the Seller pursuant to the
Mortgage Loan Purchase and Sale Agreement or purchased by the Servicer, the
Special Servicer or the Majority Certificateholder of the Controlling Class
pursuant to Section 9.01), that there has been a recovery of all related
Insurance Proceeds, Liquidation Proceeds and other payments or recoveries that
will ultimately be recoverable.
"Fiscal Agent": A Person who is at any time appointed by the Trustee
pursuant to Section 8.13 to act as fiscal agent hereunder.
"Fiscal Agent Agreement": As defined in Section 8.13.
"Fitch": Fitch IBCA, Inc. or its successor in interest. If neither such
rating agency nor any successor remains in existence, "Fitch" shall be deemed to
refer to such other nationally recognized statistical rating agency or other
comparable Person designated by the Depositor, notice of which designation shall
be given to the other parties hereto, and specific ratings of Fitch IBCA, Inc.
herein referenced shall be deemed to refer to the equivalent ratings of the
party so designated. References herein to "applicable rating category" (other
than such references to "highest applicable rating category") shall, in the case
of Fitch, be deemed to refer to such applicable rating category of Fitch,
without regard to any plus or minus or other comparable rating qualification.
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"FNMA": The Federal National Mortgage Association or any successor.
"Gaming Authority": The New Jersey Casino Control Commission, the New
Jersey Division of Gaming Enforcement or any other governmental agency which
regulates gaming in the jurisdiction in which the Showboat Property is located.
"Gaming Law": Any law, rule, regulation or ordinance governing gaming
activities in the jurisdiction in which the Showboat Property is located, and
any administrative rules or regulations promulgated thereunder, and any other
corresponding statutes, rules and regulations.
"Gaming License": Every material license, material franchise, or other
material authorization required to own, lease, operate or otherwise conduct or
manage gaming in the jurisdiction in which the Showboat Property is located.
"GMAC-CMC": GMAC Commercial Mortgage Corporation or its successor in
interest.
"Ground Lease": The ground lease pursuant to which any Mortgagor holds a
leasehold interest in the related Mortgaged Property.
"Hazardous Materials": Any dangerous, toxic or hazardous pollutants,
chemicals, wastes, or substances, including those so identified pursuant to
CERCLA or any other federal, state or local environmental related laws and
regulations now existing or hereafter enacted, and specifically including
asbestos and asbestos-containing materials, polychlorinated biphenyls ("PCBs"),
radon gas, petroleum and petroleum products, urea formaldehyde and any
substances classified as being "in inventory", "usable work in process" or
similar classification which would, if classified as unusable, be included in
the foregoing definition.
"Independent": When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor, the Seller, the
Servicer, the Special Servicer, the REMIC Administrator, the Trustee, any Fiscal
Agent and any and all Affiliates thereof, (ii) does not have any direct
financial interest in or any material indirect financial interest in any of the
Depositor, the Seller, the Servicer, the Special Servicer, the REMIC
Administrator, the Trustee, any Fiscal Agent or any Affiliate thereof, and (iii)
is not connected with the Depositor, the Seller, the Servicer, the Special
Servicer, the REMIC Administrator, the Trustee, any Fiscal Agent or any
Affiliate thereof as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions; provided, however,
that a Person shall not fail to be Independent of the Depositor, the Seller, the
Servicer, the Special Servicer, the REMIC Administrator, the Trustee, any Fiscal
Agent or any Affiliate thereof merely because such Person is the beneficial
owner of 1% or less of any class of securities issued by the Depositor, the
Seller, the Servicer, the Special Servicer, the REMIC Administrator, the
Trustee, such Fiscal Agent or any Affiliate thereof, as the case may be.
"Independent Contractor": Any Person that would be an "independent
contractor" with respect to REMIC I within the meaning of Section 856(d)(3) of
the Code if REMIC I were a real estate investment trust (except that the
ownership test set forth in that section shall be considered to be met by any
Person that owns, directly or indirectly, 35% or more of any Class of
Certificates, or such other interest in any Class of Certificates as is set
forth in an Opinion of Counsel, which shall be at no expense to the Trustee, the
REMIC Administrator or the Trust, delivered to the Trustee and the REMIC
Administrator), so long as the Trust does not receive or derive any income from
such Person and provided that the relationship between
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such Person and the Trust is at arm's length, all within the meaning of Treasury
regulation Section 1.856- 4(b)(5), or any other Person upon receipt by the
Trustee and the REMIC Administrator of an Opinion of Counsel, which shall be at
no expense to the Trustee, the REMIC Administrator or the Trust, to the effect
that the taking of any action in respect of any REO Property by such Person,
subject to any conditions therein specified, that is otherwise herein
contemplated to be taken by an Independent Contractor will not cause such REO
Property to cease to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code, or cause any income realized in respect of such
REO Property to fail to qualify as Rents from Real Property.
"Initial Pool Balance": The aggregate Cut-off Date Balance of all the
Original Mortgage Loans.
"Institutional Accredited Investor": An "accredited investor" as defined in
any of paragraphs (1), (2), (3) and (7) of Rule 501(a) under the Securities Act
or any entity in which all of the equity owners come within such paragraphs.
"Insurance Policy": With respect to any Mortgage Loan or REO Property, any
hazard insurance policy, flood insurance policy, title insurance policy or other
insurance policy that is maintained from time to time in respect of such
Mortgage Loan (or the related Mortgaged Property) or such REO Property, as the
case may be.
"Insurance Proceeds": Proceeds paid under any Insurance Policy, to the
extent such proceeds are not applied to the restoration of the related Mortgaged
Property or REO Property or released to the related Mortgagor, in any case, in
accordance with the Servicing Standard.
"Interest Accrual Basis": The basis on which interest accrues in respect of
any Mortgage Loan, any REMIC I Regular Interest, any REMIC II Regular Interest,
any Class CP REMIC III Regular Interest, any Class S REMIC III Regular Interest
or any Class of Regular Interest Certificates, consisting of one of the
following: (i) a 360-day year consisting of twelve 30-day months; (ii) actual
number of days elapsed in a 360-day year; (iii) actual number of days elapsed in
a 365-day year; or (iv) actual number of days elapsed in an actual calendar year
(taking account of leap year).
"Interest Accrual Period": With respect to any REMIC I Regular Interest,
any REMIC II Regular Interest, any Class CP REMIC III Regular Interest, any
Class S REMIC III Regular Interest or any Class of Regular Interest
Certificates, for any Distribution Date, the calendar month immediately
preceding the month in which such Distribution Date occurs.
"Interested Person": Any party hereto, the Seller, any Third Party
Originator, any Certificateholder, or any Affiliate of any such Person.
"Interest Only Certificate": Any of the Certificates designated as such in
Section 2.09.
"Investment Account": As defined in Section 3.06(a).
"IRS": The Internal Revenue Service or any successor.
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"Issue Price": With respect to each Class of Certificates, the "issue
price" as defined in the Code and Treasury regulations promulgated thereunder.
"Late Collections": With respect to any Mortgage Loan, all amounts received
thereon during any Collection Period, whether as payments, Insurance Proceeds,
Liquidation Proceeds or otherwise, which represent late collections of the
principal and/or interest portions of a Monthly Payment (other than a Balloon
Payment) or an Assumed Monthly Payment in respect of such Mortgage Loan due or
deemed due on a Due Date in a previous Collection Period, or on a Due Date
coinciding with or preceding the Cut-off Date, and not previously recovered.
With respect to any REO Mortgage Loan, all amounts received in connection with
the related REO Property during any Collection Period, whether as Insurance
Proceeds, Liquidation Proceeds, REO Revenues or otherwise, which represent late
collections of the principal and/or interest portions of a Monthly Payment
(other than a Balloon Payment) or an Assumed Monthly Payment in respect of the
predecessor Mortgage Loan or late collections of the principal and/or interest
portions of an Assumed Monthly Payment in respect of such REO Mortgage Loan due
or deemed due on a Due Date in a previous Collection Period and not previously
recovered.
"Liquidation Event": With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made with respect to such Mortgage Loan; (iii) such Mortgage
Loan is repurchased or replaced by a Third Party Originator pursuant to the
related Third Party Originator Agreement or by the Seller pursuant to the
Mortgage Loan Purchase and Sale Agreement, in each case as contemplated by
Section 2.03; or (iv) such Mortgage Loan is purchased by the Servicer, the
Special Servicer or the Majority Certificateholder of the Controlling Class
pursuant to Section 9.01. With respect to any REO Property (and the related REO
Mortgage Loan), any of the following events: (i) a Final Recovery Determination
is made with respect to such REO Property; or (ii) such REO Property is
purchased by the Servicer, the Special Servicer or the Majority
Certificateholder of the Controlling Class pursuant to Section 9.01.
"Liquidation Expenses": All customary, reasonable and necessary "out of
pocket" costs and expenses due and owing (but not otherwise covered by Servicing
Advances) in connection with the liquidation of any Specially Serviced Mortgage
Loan or REO Property pursuant to Section 3.09 or 3.18 (including legal fees and
expenses, committee or referee fees and, if applicable, brokerage commissions
and conveyance taxes).
"Liquidation Fee": With respect to each Specially Serviced Mortgage Loan or
REO Property (other than any Specially Serviced Mortgage Loan or REO Property
that is purchased by the Servicer, the Special Servicer or a Majority
Certificateholder of the Controlling Class pursuant to Section 3.18 or Section
9.01 or that is repurchased or replaced by a Third Party Originator pursuant to
the related Third Party Originator Agreement or by the Seller pursuant to the
Mortgage Loan Purchase and Sale Agreement), the fee designated as such and
payable to the Special Servicer pursuant to the third paragraph of Section
3.11(c).
"Liquidation Fee Rate": With respect to each Specially Serviced Mortgage
Loan or REO Property as to which a Liquidation Fee is payable, 1.25%.
"Liquidation Proceeds": All cash amounts (other than Insurance Proceeds and
REO Revenues) received by the Servicer or the Special Servicer in connection
with: (i) the taking of all or a part of a Mortgaged Property by exercise of the
power of eminent domain or condemnation; (ii) the liquidation of a Mortgaged
Property or other collateral constituting security for a defaulted Mortgage
Loan, through
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trustee's sale, foreclosure sale, REO Disposition or otherwise, exclusive of any
portion thereof required to be released to the related Mortgagor in accordance
with applicable law and/or the terms and conditions of the related Mortgage Note
and Mortgage; (iii) the realization upon any deficiency judgment obtained
against a Mortgagor; (iv) the purchase of a Defaulted Mortgage Loan by the
Majority Certificateholder of the Controlling Class pursuant to Section 3.18(b)
or by the Servicer or the Special Servicer pursuant to Section 3.18(c) or any
other sale thereof pursuant to Section 3.18(d); (v) the repurchase of a Mortgage
Loan by a Third Party Originator pursuant to the related Third Party Originator
Agreement or by the Seller pursuant to the Mortgage Loan Purchase and Sale
Agreement; (vi) the substitution of one or more Replacement Mortgage Loans for a
Deleted Mortgage Loan by a Third Party Originator pursuant to the related Third
Party Originator Agreement or by the Seller pursuant to the Mortgage Loan
Purchase and Sale Agreement (such cash amounts being any Substitution Shortfall
Amounts); or (vii) the purchase of a Mortgage Loan or REO Property by the
Servicer, the Special Servicer or the Majority Certificateholder of the
Controlling Class pursuant to Section 9.01.
"Loan-to-Value Ratio": With respect to any Mortgage Loan, as of any date of
determination, and without regard to the cross-collateralization in the case of
any Cross-Collateralized Mortgage Loan, a fraction, expressed as a percentage,
the numerator of which is the then current principal amount of such Mortgage
Loan, and the denominator of which is the Appraised Value of the related
Mortgaged Property.
"Majority Certificateholder": With respect to any specified Class or
Classes of Certificates, as of any date of determination, any single Holder of
Certificates of such Class or Classes, as the case may be, entitled to more than
50% of the Voting Rights allocated to such Class or Classes, as the case may be.
"Maturity Assumptions": Collectively, the assumptions identified as the
"Modeling Assumptions" in the Prospectus Supplement.
"Maximum Class CP Strip Rate: As defined in Section 2.14(d).
"Memorandum": The final Private Placement Memorandum dated February ___,
1998, relating to the Non-Registered Certificates delivered by the Depositor to
the Underwriter as of the Closing Date.
"Modified Mortgage Loan": Any Mortgage Loan as to which any Servicing
Transfer Event has occurred and which has been modified by the Special Servicer
pursuant to Section 3.20 in a manner that:
(A) affects the amount or timing of any payment of principal or
interest due thereon (other than, or in addition to, bringing current
Monthly Payments with respect to such Mortgage Loan);
(B) except as expressly contemplated by the related Mortgage, results
in a release of the lien of the Mortgage on any material portion of the
related Mortgaged Property without a corresponding Principal Prepayment in
an amount not less than the fair market value (as is) of the property to be
released, as determined by an Appraisal delivered to the Special Servicer
(at the expense of the related Mortgagor and upon which the Special
Servicer may conclusively rely); or
(C) in the reasonable, good faith judgment of the Special Servicer,
otherwise materially impairs the security for such Mortgage Loan or reduces
the likelihood of timely payment of amounts due thereon.
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"Monthly Payment": With respect to any Mortgage Loan as of any Due Date,
the scheduled monthly payment (or, in the case of an ARD Loan after its
Anticipated Repayment Date, the minimum required monthly payment) of principal
and/or interest on such Mortgage Loan, including any Balloon Payment, that is
actually payable by the related Mortgagor from time to time under the terms of
the related Mortgage Note (as such terms may be changed or modified in
connection with a bankruptcy or similar proceeding involving the related
Mortgagor or by reason of a modification, waiver or amendment granted or agreed
to by the Special Servicer pursuant to Section 3.20); provided that the Monthly
Payment due in respect of any ARD Loan after its Anticipated Repayment Date
shall not include Additional Interest.
"Moody's": Moody's Investors Service, Inc. or its successor in interest. If
neither such rating agency nor any successor remains in existence, Moody's shall
be deemed to refer to such other nationally recognized statistical rating agency
or other comparable Person designated by the Depositor, notice of which
designation shall be given to the other parties hereto, and specific ratings of
Moody's Investors Service, Inc. referenced herein shall be deemed to refer to
the equivalent ratings of the party so designated. References herein to
"applicable rating category" (other than any such references to "highest
applicable rating category") shall, in the case of Moody's, be deemed to refer
to such applicable rating category of Moody's, without regard to any plus or
minus or other comparable rating qualification.
"Mortgage": A mortgage, deed of trust, deed to secure debt or similar
document that secures a Mortgage Note and creates a lien on a Mortgaged
Property.
"Mortgaged Property": The real property (together with all improvements and
fixtures thereon) subject to the lien of a Mortgage and constituting collateral
for a Mortgage Loan.
"Mortgage File": With respect to any Mortgage Loan, subject to Sections
1.04 and 2.01, collectively the following documents:
(i) the original executed Mortgage Note, endorsed "Pay to the order of
Norwest Bank Minnesota, National Association, as trustee for the
registered holders of DLJ Commercial Mortgage Corp., Commercial
Mortgage Pass-Through Certificates, Series 1998-CF1, without
recourse";
(ii) an original or a copy of the Mortgage and of any intervening
assignments thereof that precede the assignment referred to in clause
(iv) of this definition, in each case (unless such document has not
yet been returned from the applicable recording office) with evidence
of recording indicated thereon;
(iii) an original or a copy of any related Assignment of Leases (if such
item is a document separate from the Mortgage) and of any intervening
assignments thereof that precede the assignment referred to in clause
(v) of this definition, in each case (unless such document has not yet
been returned from the applicable recording office) with evidence of
recording indicated thereon;
(iv) an original executed assignment of the Mortgage, in favor of Norwest
Bank Minnesota, National Association, as trustee for the registered
holders of DLJ Commercial Mortgage Corp., Commercial Mortgage
Pass-Through Certificates, Series 1998-CF1, in recordable form;
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(v) an original assignment of any related Assignment of Leases (if such
item is a document separate from the Mortgage), in favor of Norwest
Bank Minnesota, National Association, as trustee for the registered
holders of DLJ Commercial Mortgage Corp., Commercial Mortgage
Pass-Through Certificates, Series 1998-CF1, in recordable form;
(vi) originals or copies of any written assumption, modification and
substitution agreements in those instances where the terms or
provisions of the Mortgage or Mortgage Note have been modified or the
Mortgage Loan has been assumed;
(vii) the original or a copy of the policy or certificate of lender's title
insurance issued on the date of the origination of such Mortgage Loan,
or, if such policy has not been issued, a pro forma policy or an
irrevocable, binding commitment to issue such title insurance policy;
(viii) filed copies of any prior UCC Financing Statements in favor of the
originator of such Mortgage Loan or in favor of any assignee prior to
the Trustee (but only to the extent the Seller had possession of such
UCC Financing Statements prior to the Closing Date) and, if there is
an effective UCC Financing Statement in favor of the Seller or, if
applicable, the related Third Party Originator on record with the
applicable public office for UCC Financing Statements, an original
UCC-2 or UCC-3, as appropriate, in favor of Norwest Bank Minnesota,
National Association, as trustee for the registered holders of DLJ
Commercial Mortgage Corp., Commercial Mortgage Pass- Through
Certificates, Series 1998-CF1;
(ix) any environmental indemnity agreement, property management agreement,
Ground Lease, intercreditor agreement, cash management agreement and
lock-box agreement relating to such Mortgage Loan; and
(x) any original documents relating to Additional Collateral;
provided that whenever the term "Mortgage File" is used to refer to documents
actually received by the Trustee or by a Custodian on its behalf such term shall
not be deemed to include such documents and instruments required to be included
therein unless they are actually so received.
"Mortgage Loan": Each of the mortgage loans listed on the Mortgage Loan
Schedule and from time to time held in the Trust Fund. As used herein, the term
"Mortgage Loan" includes the related Mortgage Note, Mortgage and other security
documents contained in the related Mortgage File.
"Mortgage Loan Purchase and Sale Agreement": As defined in the Preliminary
Statement.
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"Mortgage Loan Schedule": The list of Mortgage Loans attached hereto as
Exhibit B-1, as amended from time to time in accordance with this Agreement.
Such list shall set forth the following information with respect to each
Mortgage Loan:
(i) the Mortgage Loan number;
(ii) the street address (including city, state and zip code) of the related
Mortgaged Property;
(iii) the (A) original principal balance and (B) Cut-off Date Balance;
(iv) the amount of the Monthly Payment due on the first Due Date following
the Closing Date;
(v) the Mortgage Rate;
(vi) the (A) original and remaining term to stated maturity and (B) Stated
Maturity Date;
(vii) in the case of a Balloon Mortgage Loan, the original and remaining
amortization term;
(viii) the related Originator;
(ix) whether the Mortgage Loan is a Cross-Collateralized Mortgage Loan; and
(x) whether the Mortgage Loan is an ARD Loan and, if so, the Anticipated
Repayment Date.
"Mortgage Note": The original executed note evidencing the indebtedness of
a Mortgagor under a Mortgage Loan, together with any rider, addendum or
amendment thereto, or any renewal, substitution or replacement of such note.
"Mortgage Pool": Collectively, all of the Mortgage Loans and any successor
REO Mortgage Loans as of any particular date of determination.
"Mortgage Rate": With respect to any Mortgage Loan (and any successor REO
Mortgage Loan), the annualized rate at which interest is scheduled (in the
absence of a default) to accrue on such Mortgage Loan from time to time in
accordance with the related Mortgage Note and applicable law, as such rate may
be modified in accordance with Section 3.20 or in connection with a bankruptcy,
insolvency or similar proceeding involving the related Mortgagor. In the case of
each of the ARD Loans, the related Mortgage Rate will be subject to increase in
accordance with the related Mortgage Note if the particular Mortgage Loan is not
paid in full by its Anticipated Repayment Date. Subject to modification in
accordance with Section 3.20 or in connection with a bankruptcy, insolvency or
similar proceeding involving the related Mortgagor, the Mortgage Rate for each
Mortgage Loan shall otherwise be fixed.
"Mortgagor": The obligor or obligors on a Mortgage Note, including any
Person that has acquired the related Mortgaged Property and assumed the
obligations of the original obligor under the Mortgage Note.
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"Net Aggregate Prepayment Interest Shortfall": With respect to any
Distribution Date, the amount, if any, by which (a) the aggregate of all
Prepayment Interest Shortfalls incurred in connection with the receipt of
Principal Prepayments on the Mortgage Loans during the related Collection
Period, exceeds (b) the aggregate amount remitted by the Servicer for deposit
into the Distribution Account for such Distribution Date pursuant to Section
3.19(a) in connection with such Prepayment Interest Shortfalls.
"Net Default Charges": With respect to any Mortgage Loan, any Default
Charges actually collected from the related Mortgagor or out of other
collections thereon (based on the allocations specified in Section 1.03), net of
any portion thereof allocable to pay the Special Servicer any Liquidation Fee or
Workout Fee in respect of such Mortgage Loan and further net of any Advance
Interest accrued on Advances made in respect of such Mortgage Loan and
reimbursable from such Default Charges in accordance with this Agreement.
"Net Investment Earnings": With respect to any Investment Account for any
Collection Period, the amount, if any, by which the aggregate of all interest
and other income realized during such Collection Period on funds held in such
Investment Account, exceeds the aggregate of all losses, if any, incurred during
such Collection Period in connection with the investment of such funds in
accordance with Section 3.06 (other than losses of what would otherwise have
constituted interest or other income earned on such funds).
"Net Investment Loss": With respect to any Investment Account for any
Collection Period, the amount by which the aggregate of all losses, if any,
incurred during such Collection Period in connection with the investment of
funds held in such Investment Account in accordance with Section 3.06 (other
than losses of what would otherwise have constituted interest or other income
earned on such funds), exceeds the aggregate of all interest and other income
realized during such Collection Period on such funds.
"Net Mortgage Rate": With respect to any Mortgage Loan (and any successor
REO Mortgage Loan), as of any date of determination, the then related Mortgage
Rate, minus the sum of (i) the Servicing Fee Rate, (ii) the Trustee Fee Rate and
(iii) in the case of an ARD Loan after its Anticipated Repayment Date, the
related Additional Interest Rate.
"Net Operating Income": With respect to any Mortgaged Property, the net
operating income derived from such Mortgaged Property for any specified period,
calculated in accordance with Exhibit K.
"Nonrecoverable Advance": Any Nonrecoverable P&I Advance or Nonrecoverable
Servicing Advance.
"Nonrecoverable P&I Advance": As evidenced by the Officer's Certificate and
supporting documentation contemplated by Section 4.03(c), any P&I Advance
previously made or to be made in respect of any Mortgage Loan or any REO
Mortgage Loan that, as determined by the Servicer or, if applicable, the Trustee
or any Fiscal Agent, in its reasonable, good faith judgment, will not be
ultimately recoverable from late payments, Insurance Proceeds, Liquidation
Proceeds or any other recovery on or in respect of such Mortgage Loan.
"Nonrecoverable Servicing Advance": As evidenced by the Officer's
Certificate and supporting documentation contemplated by Section 3.11(h), any
Servicing Advance previously made or to be made in respect of a Mortgage Loan or
REO Property that, as determined by the Servicer, the Special
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Servicer or, if applicable, the Trustee or any Fiscal Agent, in its reasonable,
good faith judgment, will not be ultimately recoverable from late payments,
Insurance Proceeds, Liquidation Proceeds or any other recovery on or in respect
of such Mortgage Loan or REO Property.
"Non-Registered Certificate": Any Certificate that has not been registered
under the Securities Act. As of the Closing Date, the Class B-3, Class B-4,
Class B-5, Class B-6, Class B-7, Class C, Class R-I, Class R-II and Class R-III
Certificates will constitute Non-Registered Certificates.
"Non-United States Person": Any Person other than a United States Person.
"Officer's Certificate": A certificate signed by a Servicing Officer of the
Servicer or the Special Servicer or a Responsible Officer of the Trustee or any
Fiscal Agent, as the case may be.
"Operating Statement Analysis": As defined in Section 3.12(b).
"Opinion of Counsel": A written opinion of counsel (which counsel shall be
Independent of the Depositor, the Seller, the Servicer, the Special Servicer,
the Trustee, any Fiscal Agent and the REMIC Administrator, but which may act as
counsel to such Person) acceptable to and delivered to the addressee(s) thereof
and which Opinion of Counsel shall not be at the expense of the Trustee or the
REMIC Administrator.
"Original Mortgage Loans": Collectively, those Mortgage Loans identified on
the Mortgage Loan Schedule as being included in the Trust Fund as of the Closing
Date.
"Originator": With respect to any Mortgage Loan, the originator of such
Mortgage Loan, which is (i) the Seller, (ii) ARCS, (iii) Union Capital or (iv)
GMAC-CMC, as identified on the Mortgage Loan Schedule.
"OTS": The Office of Thrift Supervision or any successor thereto.
"Ownership Interest": As to any Certificate, any ownership or security
interest in such Certificate as the Holder thereof and any other interest
therein, whether direct or indirect, legal or beneficial, as owner or as
pledgee.
"P&I Advance": As to any Mortgage Loan or REO Mortgage Loan, any advance
made by the Servicer, the Trustee or any Fiscal Agent pursuant to Section 4.03.
"P&I Advance Date": The Business Day preceding each Distribution Date.
"Pass-Through Rate": As defined in Section 2.14(d).
"Percentage Interest": With respect to any Regular Interest Certificate,
the portion of the relevant Class evidenced by such Certificate, expressed as a
percentage, the numerator of which is the Certificate Principal Balance or
Certificate Notional Amount, as the case may be, of such Certificate as of the
Closing Date, as specified on the face thereof, and the denominator of which is
the Class Principal Balance or Class Notional Amount, as the case may be, of the
relevant Class as of the Closing Date. With
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respect to a Residual Interest Certificate, the percentage interest in
distributions to be made with respect to the relevant Class, as stated on the
face of such Certificate.
"Permitted Investments": Any one or more of the following obligations or
securities:
(i) direct obligations of, or obligations fully guaranteed as to timely
payment of principal and interest by, the United States or any agency
or instrumentality thereof, provided that each such obligation is
backed by the full faith and credit of the United States;
(ii) repurchase agreements on obligations specified in clause (i), provided
that the short-term unsecured debt obligations of the party agreeing
to repurchase such obligations are at the time of investment rated in
the highest short-term debt rating category of each of S&P, Fitch (if
rated by Fitch) and Moody's (or, in the case of any Rating Agency,
have such lower rating as will not result in an Adverse Rating Event
with respect to any Class of Rated Certificates, as confirmed in
writing to the Trustee by such Rating Agency);
(iii) federal funds, uncertificated certificates of deposit, time deposits
and bankers' acceptances of any bank or trust company organized under
the laws of the United States or any state thereof, provided that the
short-term unsecured debt obligations of such bank or trust company
are at the time of investment rated in the highest short- term debt
rating category of each of S&P, Fitch (if rated by Fitch) and Moody's
(or, in the case of any Rating Agency, have such lower rating as will
not result in an Adverse Rating Event with respect to any Class of
Rated Certificates, as confirmed in writing to the Trustee by such
Rating Agency);
(iv) commercial paper of any corporation incorporated under the laws of the
United States or any state thereof (or of any corporation not so
incorporated, provided that the commercial paper is United States
Dollar denominated and amounts payable thereunder are not subject to
any withholding imposed by any non-United States jurisdiction),
provided that such commercial paper is rated in the highest short-term
debt rating category of each of S&P, Fitch (if rated by Fitch) and
Moody's (or, in the case of any Rating Agency, has such lower rating
as will not result in an Adverse Rating Event with respect to any
Class of Rated Certificates, as confirmed in writing to the Trustee by
such Rating Agency);
(v) units of money market funds which maintain a constant net asset value,
provided that such units of money market funds are rated in the
highest applicable rating category of each of each of S&P, Fitch (if
rated by Fitch) and Moody's (or, in the case of any Rating Agency,
have such lower rating as will not result in an Adverse Rating Event
with respect to any Class of Rated Certificates, as confirmed in
writing to the Trustee by such Rating Agency); or
(vi) any other obligation or security that is acceptable to the Rating
Agencies and will not result in an Adverse Rating Event with respect
to any Class of Rated Certificates (as confirmed in writing to the
Trustee by each Rating Agency);
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provided that (A) no investment described hereunder shall evidence either the
right to receive (1) only interest with respect to such investment or (2) a
yield to maturity greater than 120% of the yield to maturity at par of the
underlying obligations, (B) no investment described hereunder may be purchased
at a price greater than par if such investment may be prepaid or called at a
price less than its purchase price prior to stated maturity, (C) no investment
described hereunder may be sold prior to stated maturity if such sale would
result in a loss of principal on the instrument or a tax on "prohibited
transactions" under Section 860F of the Code and (D) no investment described
hereunder may have a "r" highlighter or other comparable qualifier attached to
its rating; provided, further, that each investment described hereunder must
have (X) a predetermined fixed amount of principal due at maturity (that cannot
vary or change), (Y) an original maturity of not more than 365 days and a
remaining maturity of not more than 30 days and (Z) except in the case of a
Permitted Investment described in clause (v) above, a fixed interest rate or an
interest rate that is tied to a single interest rate index plus a single fixed
spread; and provided, further, that each investment described hereunder must be
a "cash flow investment" (within the meaning of the REMIC Provisions).
"Permitted Transferee": Any Transferee of a Residual Interest Certificate
other than either a Disqualified Organization or a Non-United States Person.
"Person": Any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Phase I Environmental Assessment": A "Phase I assessment" as described in
and meeting the criteria of Chapter 5 of the FNMA Multifamily Guide, as amended
from time to time.
"Plan": As defined in Section 5.02(c).
"Plurality Residual Interest Certificateholder": As to any taxable year of
any REMIC Pool, the Holder of Certificates evidencing the largest Percentage
Interest in the Class of Residual Interest Certificates constituting the sole
class of "residual interests" in respect of such REMIC Pool.
"Portfolio Performance Report": As defined in Section 4.02(b).
"Prepayment Assumption": For purposes of determining the accrual of
original issue discount, market discount and premium, if any, on the Mortgage
Loans, the REMIC I Regular Interests, the REMIC II Regular Interests, the Class
CP REMIC III Regular Interests, the Class S REMIC III Regular Interests and the
Certificates for federal income tax purposes, the assumption that no Mortgage
Loan (other than an ARD Loan) is voluntarily prepaid prior to its Stated
Maturity Date and that no ARD Loan is prepaid prior to, but each is paid in its
entirety on, its Anticipated Prepayment Date.
"Prepayment Interest Excess": With respect to any Mortgage Loan that was
subject to a Principal Prepayment in full or in part made after its Due Date in
any Collection Period, any payment of interest (net of related Servicing Fees)
actually collected from the related Mortgagor and intended to cover the period
from and after such Due Date to, but not including, the date of prepayment
(exclusive, however, of any related Prepayment Premium or Yield Maintenance
Premium that may have been collected and, in the case of an ARD Loan after its
Anticipated Repayment Date, of any Additional Interest).
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"Prepayment Interest Shortfall": With respect to any Mortgage Loan that was
subject to a Principal Prepayment in full or in part made prior to its Due Date
in any Collection Period, the amount of interest, to the extent not collected
from the related Mortgagor (without regard to any Prepayment Premium or Yield
Maintenance Premium that may have been collected), that would have accrued at a
rate per annum equal to the sum of the related Net Mortgage Rate plus the
Trustee Fee Rate on the amount of such Principal Prepayment during the period
from the date of prepayment to, but not including, such Due Date.
"Prepayment Premium": With respect to any Mortgage Loan, any premium,
penalty or fee paid or payable, as the context requires, by a Mortgagor in
connection with a Principal Prepayment on, or other early collection of
principal of, a Mortgage Loan or any successor REO Mortgage Loan, to the extent
such premium, penalty or fee is expressed as a percentage of the principal
amount being prepaid or as a specified amount.
"Primary Servicing Office": The office of the Servicer or the Special
Servicer, as the context may require, that is primarily responsible for such
party's servicing obligations hereunder.
"Prime Rate": The "prime rate" published in the "Money Rates" section of
The Wall Street Journal, as such "prime rate" may change from time to time. If
The Wall Street Journal ceases to publish the "prime rate," then the Trustee, in
its sole discretion, shall select an equivalent publication that publishes such
"prime rate;" and if such "prime rate" is no longer generally published or is
limited, regulated or administered by a governmental or quasi- governmental
body, then the Trustee shall select a comparable interest rate index. In either
case, such selection shall be made by the Trustee in its sole discretion and the
Trustee shall notify the Servicer and the Special Servicer in writing of its
selection.
"Principal Distribution Amount": With respect to any Distribution Date, an
amount equal to the aggregate (without duplication) of the following:
(a) the aggregate of all payments of principal (other than Principal
Prepayments) received on the Mortgage Loans during the related Collection
Period, in each case net of any portion of the particular payment that
represents a Late Collection of principal for which a P&I Advance was
previously made for a prior Distribution Date or that represents the
principal portion of a Monthly Payment due on or before the Cut-off Date or
on a Due Date subsequent to the related Collection Period;
(b) the aggregate of the principal portions of all Monthly Payments
due in respect of the Mortgage Loans for their respective Due Dates
occurring during the related Collection Period that were received prior to
the related Collection Period;
(c) the aggregate of all Principal Prepayments received on the
Mortgage Loans during the related Collection Period;
(d) the aggregate of all Liquidation Proceeds and Insurance Proceeds
received on the Mortgage Loans during the related Collection Period that
were identified and applied by the Servicer as recoveries of principal of
such Mortgage Loans in accordance with Section 1.03, in each case net of
any portion of such proceeds that represents a Late Collection of principal
due on or before the Cut-off Date or for which a P&I Advance was previously
made for a prior Distribution Date;
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(e) the aggregate of all Liquidation Proceeds, Insurance Proceeds and
REO Revenues received in respect of any REO Properties during the related
Collection Period that were identified and applied by the Servicer as
recoveries of principal of the related REO Mortgage Loans in accordance
with Section 1.03, in each case net of any portion of such proceeds and/or
revenues that represents a Late Collection of principal due on or before
the Cut-off Date or for which a P&I Advance was previously made for a prior
Distribution Date; and
(f) the aggregate of the principal portions of all P&I Advances made
in respect of the Mortgage Loans and any REO Mortgage Loans with respect to
such Distribution Date.
"Principal Prepayment": Any voluntary payment of principal made by the
Mortgagor on a Mortgage Loan that is received in advance of its scheduled Due
Date, that is not accompanied by an amount of interest (without regard to any
Prepayment Premium or Yield Maintenance Premium that may have been collected)
representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment and that is not related to the special
servicing of such Mortgage Loan.
"Proposed Plan": As defined in Section 3.17(a).
"Prospectus": The Base Prospectus and the Prospectus Supplement, together.
"Prospectus Supplement": That certain prospectus supplement dated February
20, 1998, relating to the Registered Certificates, that is a supplement to the
Base Prospectus.
"Purchase Price": With respect to any Mortgage Loan (or REO Property), a
cash price equal to the aggregate of: (a) the outstanding principal balance of
such Mortgage Loan (or the related REO Mortgage Loan) as of the date of
purchase, (b) all accrued and unpaid interest on such Mortgage Loan (or the
related REO Mortgage Loan) at the related Mortgage Rate to, but not including,
the date of purchase (or, if such purchase occurs after the Determination Date
in any calendar month, through the end of such calendar month), (c) all related
unreimbursed Servicing Advances, and (d) solely in the case of a purchase by a
Third Party Originator pursuant to the related Third Party Originator Agreement
or by the Seller pursuant to the Mortgage Loan Purchase and Sale Agreement, all
accrued and unpaid Advance Interest in respect of related Advances.
"Qualified Appraiser": In connection with the appraisal of any Mortgaged
Property or REO Property, an Independent MAI-designated appraiser with at least
five years of experience in respect of the relevant geographic location and
property type.
"Qualified Institutional Buyer": A "qualified institutional buyer" within
the meaning of Rule 144A under the Securities Act.
"Qualified Insurer": An insurance company or security or bonding company
qualified to write the related Insurance Policy in the relevant jurisdiction.
"Qualifying Substitute Mortgage Loan": In the case of any substitution for
a Deleted Mortgage Loan as contemplated by Section 2.03, a mortgage loan which,
on the date of substitution, (i) has a principal balance, after deduction of the
principal portion of the Monthly Payment due in the month of
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substitution, not in excess of the Stated Principal Balance of the Deleted
Mortgage Loan; (ii) is accruing interest at a fixed rate of interest at least
equal to that of the Deleted Mortgage Loan; (iii) has the same Due Date as the
Deleted Mortgage Loan; (iv) is accruing interest on the same Interest Accrual
Basis as the Deleted Mortgage Loan; (v) has a remaining term to stated maturity
not greater than, and not more than two years less than, that of the Deleted
Mortgage Loan and, in any event, has a Stated Maturity Date not later than two
years prior to the Rated Final Distribution Date; (vi) has a then current
Loan-to-Value Ratio not higher than, and a then current Debt Service Coverage
Ratio not lower than, the Loan-to-Value Ratio and Debt Service Coverage Ratio,
respectively, of the Deleted Mortgage Loan as of the Closing Date; (vii) will
comply with all of the representations and warranties relating to Mortgage Loans
set forth in or made pursuant to of the Mortgage Loan Purchase and Sale
Agreement and, if applicable, the related Third Party Originator Agreement, as
of the date of substitution; (viii) has a Phase I Environmental Assessment
relating to the related Mortgaged Property in its Servicing File, which Phase I
Environmental Assessment will evidence that there is no material adverse
environmental condition or circumstance at the related Mortgaged Property for
which further remedial action may be required under applicable law; and (ix)
constitutes a "qualified replacement mortgage" within the meaning of Section
860G(a)(4) of the Code; provided, however, that if more than one mortgage loan
is to be substituted for any Deleted Mortgage Loan, then all such proposed
Replacement Mortgage Loans shall, in the aggregate, satisfy the requirement
specified in clause (i) of this definition and each such proposed Replacement
Mortgage Loan shall, individually, satisfy each of the requirements specified in
clauses (ii) through (ix) of this definition; and provided, further, that no
mortgage loan shall be substituted for a Deleted Mortgage Loan unless (x) as
established by an Opinion of Counsel to such effect delivered to the Trustee by
the Seller or Third Party Originator effecting the substitution, the inclusion
of such prospective Replacement Mortgage Loan does not adversely effect the
nature of the Class CP, Class S, Class A-1A, Class A-1B and/or Class A-2
Certificates as "mortgage related securities" for purposes of the Secondary
Mortgage Market Enhancement Act of 1984, as amended, (y) such prospective
Replacement Mortgage Loan shall be acceptable to the Controlling Class
Representative (or, if there is no Controlling Class Representative then
serving, to the Holders of Certificates representing a majority of the Voting
Rights allocated to the Controlling Class), in its (or their) sole discretion,
and (z) each Rating Agency shall have confirmed in writing to the Trustee that
such substitution will not in and of itself result in an Adverse Rating Event
with respect to any Class of Rated Certificates (such written confirmation to be
obtained by the Seller or Third Party Originator effecting the substitution). It
is understood and agreed that the Controlling Class Representative (or, if no
Controlling Class Representative is then serving, the Holders of Certificates
representing a majority of the Voting Rights assigned to the Controlling Class)
could find a prospective Replacement Mortgage Loan unacceptable for any reason
or no reason whatsoever.
"Rated Certificate": Any of the Certificates to which a rating has been
assigned by either Rating Agency at the request of the Depositor.
"Rated Final Distribution Date": The Distribution Date in February 2031.
"Rating Agency": Each of S&P, Fitch and Moody's.
"Realized Loss": With respect to: (1) each defaulted Mortgage Loan as to
which a Final Recovery Determination has been made, or with respect to any
successor REO Mortgage Loan as to which a Final Recovery Determination has been
made as to the related REO Property, an amount (not less than zero) equal to (a)
the unpaid principal balance of such Mortgage Loan or REO Mortgage Loan, as the
case may be, as of the commencement of the Collection Period in which the Final
Recovery Determination was made, plus (b) without taking into account the amount
described in subclause (1)(c) of this definition, all
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accrued but unpaid interest on such Mortgage Loan or REO Mortgage Loan, as the
case may be, at the related Mortgage Rate to, but not including, the related Due
Date in the Collection Period in which the Final Recovery Determination was made
(exclusive, however, in the case of an ARD Loan after its Anticipated Repayment
Date, of Additional Interest), minus (c) all payments and proceeds, if any,
received in respect of such Mortgage Loan or REO Mortgage Loan, as the case may
be, during the Collection Period in which such Final Recovery Determination was
made (net of any related Servicing Advances reimbursed therefrom and any related
Liquidation Expenses paid therefrom); (2) each defaulted Mortgage Loan as to
which any portion of the principal or past due interest payable thereunder was
cancelled in connection with a bankruptcy or similar proceeding involving the
related Mortgagor or a modification, waiver or amendment of such Mortgage Loan
granted or agreed to by the Servicer or the Special Servicer pursuant to Section
3.20, the amount of such principal or past due interest (other than any Default
Interest and, in the case of an ARD Loan after its Anticipated Repayment Date,
Additional Interest) so cancelled; and (3) each defaulted Mortgage Loan as to
which the Mortgage Rate thereon has been permanently reduced and not recaptured
for any period in connection with a bankruptcy or similar proceeding involving
the related Mortgagor or a modification, waiver or amendment of such Mortgage
Loan granted or agreed to by the Servicer or the Special Servicer pursuant to
Section 3.20, the amount of any consequent reduction in the interest portion of
each successive Monthly Payment due thereon (each such Realized Loss to be
deemed to have been incurred on the Due Date for each affected Monthly Payment).
"Record Date": With respect to any Distribution Date, the last Business Day
of the month immediately preceding the month in which such Distribution Date
occurs.
"Reduced Special Servicing Fee Rate": 0.25% per annum.
"Registered Certificate": Any Certificate that has been registered under
the Securities Act. As of the Closing Date, the Class CP, Class S, Class A-1A,
Class A-1B, Class A-2, Class A-3, Class B-1 and Class B-2 Certificates
constitute Registered Certificates.
"Regular Interest Certificate": Any of the Certificates designated as such
in Section 2.09.
"Reimbursement Rate": The rate per annum applicable to the accrual of
Advance Interest, which rate per annum is equal to the Prime Rate.
"REMIC": A "real estate mortgage investment conduit" as defined in Section
860D of the Code.
"REMIC Administrator": Norwest Bank Minnesota, National Association or its
successor in interest, in its capacity as REMIC administrator hereunder, or any
successor REMIC administrator appointed as herein provided.
"REMIC I": The segregated pool of assets designated as such in Section
2.10(a)
"REMIC I Regular Interest": Any of the separate non-certificated beneficial
ownership interests in REMIC I issued hereunder and, in each such case,
designated as a "regular interest" in REMIC I. The REMIC I Regular Interests
have the designations and terms provided for in Section 2.10.
"REMIC I Remittance Rate": As defined in Section 2.10(f).
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"REMIC II": The segregated pool of assets designated as such in Section
2.12(a).
"REMIC II Regular Interest": Any of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and, in each such
case, designated as a "regular interest" in REMIC II. The REMIC II Regular
Interests have the designations and terms provided for in Section 2.12.
"REMIC II Remittance Rate": As defined in Section 2.12(f).
"REMIC III": The segregated pool of assets designated as such in Section
2.14(a).
"REMIC III Certificate": Any of the Certificates designated as such in
Section 2.09.
"REMIC Pool": Any of REMIC I, REMIC II and REMIC III.
"REMIC Provisions": Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Sections 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
proposed, temporary and final Treasury regulations and any published rulings,
notices and announcements promulgated thereunder, as the foregoing may be in
effect from time to time.
"Rents from Real Property": With respect to any REO Property, gross income
of the character described in Section 856(d) of the Code.
"REO Account": A segregated custodial account or accounts created and
maintained by the Special Servicer pursuant to Section 3.16(b) on behalf of the
Trustee in trust for the Certificateholders, which shall be entitled "Clarion
Partners, LLC, as Special Servicer, in trust for the registered holders of DLJ
Commercial Mortgage Corp., Commercial Mortgage Pass-Through Certificates, Series
1998-CF1".
"REO Acquisition": The acquisition of any REO Property pursuant to Section
3.09.
"REO Disposition": The sale or other disposition of any REO Property
pursuant to Section 3.18(d).
"REO Extension": As defined in Section 3.16(a).
"REO Mortgage Loan": The mortgage loan deemed for purposes hereof to be
outstanding with respect to each REO Property. Each REO Mortgage Loan shall be
deemed to provide for monthly payments of principal and/or interest equal to its
Assumed Monthly Payment and otherwise to have the same terms and conditions as
its predecessor Mortgage Loan (such terms and conditions to be applied without
regard to the default on such predecessor Mortgage Loan). Each REO Mortgage Loan
shall be deemed to have an initial unpaid principal balance and Stated Principal
Balance equal to the unpaid principal balance and Stated Principal Balance,
respectively, of its predecessor Mortgage Loan as of the date of the related REO
Acquisition. All Monthly Payments (other than any Balloon Payment), Assumed
Monthly Payments (in the case of a Balloon Mortgage Loan delinquent in respect
of its Balloon Payment) and other amounts due and owing, or deemed to be due and
owing, in respect of the predecessor Mortgage Loan as of the date of the related
REO Acquisition, shall be deemed to continue to be due and owing in respect of
an REO Mortgage Loan. In addition, all amounts payable or reimbursable to the
Servicer, the Special Servicer, the Trustee or
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any Fiscal Agent in respect of the predecessor Mortgage Loan as of the date of
the related REO Acquisition, including any unpaid or unreimbursed Servicing
Fees, Special Servicing Fees and Advances (together with any related unpaid
Advance Interest), shall continue to be payable or reimbursable in the same
priority and manner pursuant to Section 3.05(a) to the Servicer, the Special
Servicer, the Trustee or any Fiscal Agent, as the case may be, in respect of an
REO Mortgage Loan.
"REO Property": A Mortgaged Property acquired by the Special Servicer on
behalf of the Trust for the benefit of the Certificateholders through
foreclosure, acceptance of a deed in lieu of foreclosure or otherwise in
accordance with applicable law in connection with the default or imminent
default of a Mortgage Loan.
"REO Revenues": All income, rents, profits and proceeds derived from the
ownership, operation or leasing of any REO Property.
"REO Tax": As defined in Section 3.17(a).
"Replacement Mortgage Loan": Any mortgage loan that is substituted by the
Seller or a Third Party Originator for a Deleted Mortgage Loan as contemplated
by Section 2.03.
"Request for Release": A request signed by a Servicing Officer of, as
applicable, the Servicer in the form of Exhibit D-1 attached hereto or the
Special Servicer in the form of Exhibit D-2 attached hereto.
"Required Appraisal Loan": As defined in Section 3.19(c).
"Reserve Account": Any of the accounts established and maintained pursuant
to Section 3.03(d).
"Reserve Funds": With respect to any Mortgage Loan, any amounts delivered
by the related Mortgagor to be held in escrow by or on behalf of the mortgagee
representing: (i) reserves for repairs, replacements, capital improvements
and/or environmental testing and remediation with respect to the related
Mortgaged Property; (ii) reserves for tenant improvements and leasing
commissions; or (iii) amounts to be applied as a Principal Prepayment on such
Mortgage Loan or held as Additional Collateral in the event that certain leasing
or other economic criteria in respect of the related Mortgaged Property are not
met.
"Residual Interest Certificate": Any of the Certificates designated as such
in Section 2.09.
"Responsible Officer": When used with respect to the Trustee, the
President, the Treasurer, the Secretary, any Vice President, any Assistant Vice
President, any Trust Officer, any Assistant Secretary or any other officer of
the Trustee customarily performing functions similar to those performed by any
of the above designated officers and having direct responsibility for the
administration of this Agreement. When used with respect to any Fiscal Agent or
any Certificate Registrar (other than the Trustee), any officer or assistant
officer thereof.
"S&P": Standard & Poor's Ratings Services, a Division of the McGraw-Hill
Companies, Inc., or its successor in interest. If neither such rating agency nor
any successor remains in existence, "S&P" shall be deemed to refer to such other
nationally recognized statistical rating agency or other comparable Person
designated by the Depositor, notice of which designation shall be given to the
other parties hereto, and
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specific ratings of Standard & Poor's Ratings Services, a Division of the
McGraw-Hill Companies, Inc., herein referenced shall be deemed to refer to the
equivalent ratings of the party so designated. References herein to "applicable
rating category" (other than any such references to "highest applicable rating
category") shall, in the case of S&P, be deemed to refer to such applicable
rating category of S&P, without regard to any plus or minus or other comparable
rating qualification.
"Securities Act": The Securities Act of 1933, as amended.
"Seller": Column Financial, Inc. or its successor in interest. As of the
Closing Date, the Seller is a wholly-owned subsidiary of DLJ Mortgage Capital,
Inc.
"Senior Certificate": Any of the Certificates designated as such in Section
2.09.
"Senior Principal Distribution Cross-Over Date": The first Distribution
Date as of which the aggregate of the Class Principal Balances of the Class A-1A
Certificates and the Class A-1B Certificates outstanding immediately prior
thereto exceeds the sum of (a) the aggregate Stated Principal Balance of the
Mortgage Pool that will be outstanding immediately following such Distribution
Date, plus (b) the lesser of (i) the Principal Distribution Amount for such
Distribution Date and (ii) the portion of the Available Distribution Amount for
such Distribution Date that will remain after the distributions of interest to
be made on the Senior Certificates on such Distribution Date have been so made.
"Sequential Pay Certificate": Any of the Certificates designated as such in
Section 2.09.
"Servicer": Banc One Mortgage Capital Markets, LLC or its successor in
interest, in its capacity as servicer hereunder, or any successor servicer
appointed as herein provided.
"Servicer Remittance Amount": With respect to any Servicer Remittance Date,
an amount equal to (a) all amounts on deposit in the Collection Account as of
the commencement of business on such Servicer Remittance Date, net of (b) any
portion of the amounts described in clause (a) of this definition that
represents one or more of the following: (i) collected Monthly Payments that are
due on a Due Date following the end of the related Collection Period, (ii) any
payments of principal (including Principal Prepayments) and interest,
Liquidation Proceeds and Insurance Proceeds received after the end of the
related Collection Period, (iii) any Prepayment Premiums and/or Yield
Maintenance Premiums received after the end of the related Collection Period,
(iv) any amounts payable or reimbursable to any Person from the Collection
Account pursuant to clauses (ii) through (xvii) of Section 3.05(a), and (v) any
amounts deposited in the Collection Account in error; provided that the Servicer
Remittance Amount for the Servicer Remittance Date that occurs in the same
calendar month as the anticipated Final Distribution Date shall be calculated
without regard to clauses (b)(i), (b)(ii) and (b)(iii) of this definition.
"Servicer Remittance Date": The Business Day preceding each Distribution
Date.
"Servicing Account": Any of the accounts established and maintained
pursuant to Section 3.03(a).
"Servicing Advances": All customary, reasonable and necessary "out of
pocket" costs and expenses paid or to be paid, as the context requires, out of
its own funds, by the Servicer or the Special Servicer (or, if applicable, the
Trustee or any Fiscal Agent) in connection with the servicing of a Mortgage
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Loan after a default, delinquency or other unanticipated event, or in connection
with the administration of any REO Property, including any such costs and
expenses associated with (a) compliance with the obligations of the Servicer
and/or the Special Servicer set forth in Sections 2.02(e), 2.03(c) , 3.03(c) and
3.09, (b) the preservation, insurance, restoration, protection and management of
a Mortgaged Property, including the cost of any "force placed" insurance policy
purchased by the Servicer or the Special Servicer to the extent such cost is
allocable to a particular Mortgaged Property that the Servicer or the Special
Servicer is required to cause to be insured pursuant to Section 3.07(a), (c)
obtaining any Liquidation Proceeds or Insurance Proceeds in respect of any such
Mortgage Loan or any REO Property, (d) any enforcement or judicial proceedings
with respect to a Mortgaged Property, including foreclosures and similar
proceedings, (e) the operation, management, maintenance and liquidation of any
REO Property, (f) obtaining any Appraisal required to be obtained hereunder, (g)
UCC filings that are not reimbursed by the related Mortgagor, (h) travel
necessary for the Special Servicer to perform the property inspections required
to be performed by it pursuant to Section 3.12(a), and (i) any other expenditure
which is expressly designated as a Servicing Advance herein; provided that
notwithstanding anything to the contrary, "Servicing Advances" shall not include
allocable overhead of the Servicer or the Special Servicer, such as costs for
office space, office equipment, supplies and related expenses, employee salaries
and related expenses and similar internal costs and expenses, or costs incurred
by either such party in connection with its purchase of any Mortgage Loan or REO
Property pursuant to any provision of this Agreement.
"Servicing Fee": With respect to each Mortgage Loan and REO Mortgage Loan,
the fee designated as such and payable to the Servicer pursuant to Section
3.11(a).
"Servicing Fee Rate": With respect to each Mortgage Loan and REO Mortgage
Loan, 0.096% per annum.
"Servicing File": Any documents (other than documents required to be part
of the related Mortgage File) in the possession of the Servicer or the Special
Servicer and relating to the origination and servicing of any Mortgage Loan or
the administration of any REO Property.
"Servicing Officer": Any officer or employee of the Servicer or the Special
Servicer involved in, or responsible for, the administration and servicing of
the Mortgage Loans, whose name and specimen signature appear on a list of
servicing officers furnished by such party to the Trustee and the Depositor on
the Closing Date, as such list may be amended from time to time.
"Servicing Return Date": With respect to any Corrected Mortgage Loan, the
date that servicing thereof is returned by the Special Servicer to the Servicer
pursuant to Section 3.21(a).
"Servicing Standard": With respect to the Servicer or the Special Servicer,
to service and administer the Mortgage Loans and REO Properties for which it is
responsible hereunder: (a) with the higher of (i) the same care, skill, prudence
and diligence with which the Servicer or the Special Servicer, as the case may
be, generally services and administers comparable mortgage loans and REO
properties for other third parties, giving due consideration to customary and
usual standards of practice of prudent institutional commercial mortgage lenders
and loan servicers servicing and administering their own mortgage loans and REO
properties, and (ii) the same care, skill, prudence and diligence with which the
Servicer or the Special Servicer, as the case may be, generally services and
administers comparable mortgage loans and REO properties owned by it; (b) with a
view to the timely collection of all scheduled payments of principal and
interest under the Mortgage Loans, the full collection of all Prepayment
Premiums and Yield Maintenance
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Premiums that may become payable under the Mortgage Loans and, if a Mortgage
Loan comes into and continues in default and no satisfactory arrangements can be
made for the collection of the delinquent payments (including payments of
Prepayment Premiums and Yield Maintenance Premiums), the maximization of the
recovery on such Mortgage Loan to the Certificateholders (as a collective whole)
on a present value basis (the relevant discounting of anticipated collections
that will be distributable to Certificateholders to be performed at the related
Net Mortgage Rate); and (c) without regard to: (i) any relationship that the
Servicer (or any Affiliate thereof) or the Special Servicer (or any Affiliate
thereof), as the case may be, may have with the related Mortgagor or with any
other party to this Agreement; (ii) the ownership of any Certificate by the
Servicer (or any Affiliate thereof) or the Special Servicer (or any Affiliate
thereof), as the case may be; (iii) the Servicer's obligation to make Advances;
(iv) the Special Servicer's obligation to make Servicing Advances; and (v) the
right of the Servicer (or any Affiliate thereof) or the Special Servicer (or any
Affiliate thereof), as the case may be, to receive compensation for its services
or reimbursement of costs hereunder or with respect to any particular
transaction.
"Servicing Transfer Event": With respect to any Mortgage Loan, the
occurrence of any of the events described in clauses (a) through (h) of the
definition of "Specially Serviced Mortgage Loan".
"Showboat Loan": The Mortgage Loan identified on the Mortgage Loan Schedule
as being secured by a Mortgaged Property located on the Boardwalk in Atlantic
City, New Jersey.
"Showboat Property": The Mortgaged Property securing the Showboat Loan.
"Specially Serviced Mortgage Loan": Any Mortgage Loan as to which any of
the following events has occurred:
(a) the related Mortgagor has failed to make when due any Balloon Payment,
which failure continues, or the Servicer determines, in its
reasonable, good faith judgment, will continue, unremedied for 30
days; or
(b) the related Mortgagor has failed to make when due any Monthly Payment
(other than a Balloon Payment) or any other payment required under the
related Mortgage Note or the related Mortgage, which failure
continues, or the Servicer determines, in its reasonable, good faith
judgment, will continue, unremedied for 60 days; or
(c) the Servicer has determined, in its reasonable, good faith judgment,
that a default in making a Monthly Payment (including a Balloon
Payment) or any other payment required under the related Mortgage Note
or the related Mortgage is likely to occur within 30 days and either
(i) the related Mortgagor has requested a material modification of the
related Mortgage Loan (other than a waiver of a "due-on-sale" clause
permitted under Section 3.08 or the extension of the related maturity
date) or (ii) such default is likely to remain unremedied for at least
60 days or, in the case of a Balloon Payment, for at least 30 days; or
(d) the Servicer has determined, in its reasonable, good faith judgment,
that a default, other than as described in clause (a) or (b) above,
has occurred that may materially impair the value of the related
Mortgaged Property as security for the Mortgage
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Loan, which default has continued unremedied for the applicable cure
period under the terms of the Mortgage Loan (or, if no cure period is
specified, for 30 days); or
(e) a decree or order of a court or agency or supervisory authority having
jurisdiction in the premises in an involuntary action against the
related Mortgagor under any present or future federal or state
bankruptcy, insolvency or similar law or the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshalling of assets and liabilities or similar proceedings,
or for the winding-up or liquidation of its affairs, shall have been
entered against the related Mortgagor and such decree or order shall
have remained in force undischarged or unstayed for a period of 60
days; or
(f) the related Mortgagor shall have consented to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshalling of assets and liabilities or similar proceedings
of or relating to such Mortgagor or of or relating to all or
substantially all of its property; or
(g) the related Mortgagor shall have admitted in writing its inability to
pay its debts generally as they become due, filed a petition to take
advantage of any applicable insolvency or reorganization statute, made
an assignment for the benefit of its creditors, or voluntarily
suspended payment of its obligations; or
(h) the Servicer shall have received notice of the commencement of
foreclosure or similar proceedings with respect to the related
Mortgaged Property;
provided, however, that a Mortgage Loan shall cease to be a Specially Serviced
Mortgage Loan, when a Liquidation Event has occurred in respect of such Mortgage
Loan, when the related Mortgaged Property has become an REO Property or, so long
as at such time no circumstance identified in clauses (a) through (h) above
exists that would cause the Mortgage Loan to continue to be characterized as a
Specially Serviced Mortgage Loan:
(w) with respect to the circumstances described in clauses (a) and (b)
above, when the related Mortgagor has made three consecutive full and
timely Monthly Payments under the terms of such Mortgage Loan (as such
terms may be changed or modified in connection with a bankruptcy or
similar proceeding involving the related Mortgagor or by reason of a
modification, waiver or amendment granted or agreed to by the Servicer
or the Special Servicer pursuant to Section 3.20);
(x) with respect to the circumstances described in clauses (c), (e), (f)
and (g) above, when such circumstances cease to exist in the
reasonable, good faith judgment of the Special Servicer;
(y) with respect to the circumstances described in clause (d) above, when
such default is cured; and
(z) with respect to the circumstances described in clause (h) above, when
such proceedings are terminated.
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"Special Servicer": Clarion Partners, LLC or its successor in interest, in
its capacity as special servicer hereunder, or any successor Special Servicer
appointed as herein provided.
"Special Servicer Report": As defined in Section 4.02(c).
"Special Servicing Fee": With respect to each Specially Serviced Mortgage
Loan and each REO Mortgage Loan, the fee designated as such and payable to the
Special Servicer pursuant to the first paragraph of Section 3.11(c).
"Special Servicing Fee Rate": With respect to each Specially Serviced
Mortgage Loan and each REO Mortgage Loan, 0.35% per annum.
"Startup Day": With respect to each REMIC Pool, the day designated as such
in Section 2.10(a) (in the case of REMIC I), Section 2.12(a) (in the case of
REMIC II) and Section 2.14(a) (in the case of REMIC III).
"Stated Maturity Date": With respect to any Mortgage Loan, the Due Date
specified in the Mortgage Note (as in effect on the Closing Date or, in the case
of a Replacement Mortgage Loan, on the related date of substitution) on which
the last payment of principal is due and payable under the terms of the Mortgage
Note (as in effect on the Closing Date or, in the case of a Replacement Mortgage
Loan, on the related date of substitution), without regard to any change in or
modification of such terms in connection with a bankruptcy or similar proceeding
involving the related Mortgagor or a modification, waiver or amendment of such
Mortgage Loan granted or agreed to by the Special Servicer pursuant to Section
3.20 and, in the case of an ARD Loan, without regard to its Anticipated
Repayment Date.
"Stated Principal Balance": With respect to any Mortgage Loan (and any
successor REO Mortgage Loan), the Cut-off Date Balance of such Mortgage Loan
(or, in the case of any Replacement Mortgage Loan, the unpaid principal balance
thereof as of the related date of substitution, after application of all
payments of principal due thereon on or before such date, whether or not
received), as permanently reduced on each subsequent Distribution Date (to not
less than zero) by (i) that portion, if any, of the Principal Distribution
Amount for such Distribution Date allocable to such Mortgage Loan (or successor
REO Mortgage Loan), and (ii) the principal portion of any Realized Loss incurred
in respect of such Mortgage Loan (or successor REO Mortgage Loan) during the
related Collection Period. Notwithstanding the foregoing, if a Liquidation Event
occurs in respect of any Mortgage Loan or REO Property, then the "Stated
Principal Balance" of such Mortgage Loan or of the related REO Mortgage Loan, as
the case may be, shall be zero commencing as of the Distribution Date in the
Collection Period next following the Collection Period in which such Liquidation
Event occurred.
"Subordinated Certificate": Any of the Certificates designated as such in
Section 2.09.
"Sub-Servicer": Any Person with which the Servicer or the Special Servicer
has entered into a Sub-Servicing Agreement.
"Sub-Servicing Agreement": The written contract between the Servicer or the
Special Servicer, on the one hand, and any Sub-Servicer, on the other hand,
relating to servicing and administration of Mortgage Loans as provided in
Section 3.22.
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"Substitution Shortfall Amount": In connection with the substitution of one
or more Replacement Mortgage Loans for any Deleted Mortgage Loan, the amount, if
any, by which the Purchase Price for such Deleted Mortgage Loan (calculated as
if it were to be repurchased, instead of replaced, on the relevant date of
substitution), exceeds the initial Stated Principal Balance or the initial
aggregate Stated Principal Balance, as the case may be, of such Replacement
Mortgage Loan(s).
"Summary Business Plan": As defined in Section 3.24(a).
"Tax Matters Person": With respect to any REMIC Pool, the Person designated
as the "tax matters person" of such REMIC Pool in the manner provided under
Treasury regulation section 1.860F-4(d) and temporary Treasury regulation
section 301.6231(a)(7)-1T, which Person shall, pursuant to Section 10.01(b), be
the Plurality Residual Interest Certificateholder in respect of the related
Class of Residual Interest Certificates.
"Tax Returns": The federal income tax return on IRS Form 1066, U.S. Real
Estate Mortgage Investment Conduit Income (REMIC) Tax Return, including Schedule
Q thereto, Quarterly Notice to Residual Interest Holder of REMIC Taxable Income
or Net Loss Allocation, or any successor forms, to be filed on behalf of each
REMIC Pool due to its classification as a REMIC under the REMIC Provisions,
together with any and all other information, reports or returns that may be
required to be furnished to the Certificateholders or filed with the IRS under
any applicable provisions of federal tax law or any other governmental taxing
authority under applicable state or local tax laws.
"Termination Price": As defined in Section 9.01.
"Third Party Mortgage Loan": Any Mortgage Loan originated by a Third Party
Originator.
"Third Party Originator": Any Originator other than the Seller.
"Third Party Originator Agreement": With respect to ARCS and each Third
Party Mortgage Loan originated thereby, the Seller's Warranty Certificate dated
as of February 20, 1998, from ARCS in favor of DLJ Mortgage Capital, Inc., the
form of which is attached hereto as Exhibit N-1; and, with respect to Union
Capital and each Third Party Mortgage Loan originated thereby, the Seller's
Warranty Certificate dated as of February 22, 1998, from Union Capital in favor
of DLJ Mortgage Capital, Inc., the form of which is attached hereto as Exhibit
N-2.
"Transfer": Any direct or indirect transfer, sale, pledge, hypothecation,
or other form of assignment of any Ownership Interest in a Certificate.
"Transfer Affidavit and Agreement": As defined in Section 5.02(d).
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
"Transferor": Any Person who is disposing by Transfer any Ownership
Interest in a Certificate.
"Treasury Rate": As defined in Section 4.01(b).
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"Trust": The trust created hereby.
"Trustee": Norwest Bank Minnesota, National Association or its successor in
interest, in its capacity as trustee hereunder, or any successor trustee
appointed as herein provided.
"Trustee Report": As defined in Section 4.02(a).
"Trustee's Fee": The fee designated as such and payable to the Trustee
pursuant to Section 8.05(a).
"Trustee's Fee Rate": 0.004% per annum.
"Trust Fund": Collectively, all of the assets of REMIC I, REMIC II and
REMIC III.
"Trust Receipt": As defined in Section 2.01(d).
"UCC": The Uniform Commercial Code in effect in the applicable
jurisdiction.
"UCC Financing Statement": A financing statement executed and filed
pursuant to the Uniform Commercial Code, as in effect in any relevant
jurisdiction.
"Uncertificated Accrued Interest": The interest accrued from time to time
in respect of (i) any REMIC I Regular Interest, calculated in accordance with
Section 2.10(g); or (ii) any REMIC II Regular Interest, calculated in accordance
with Section 2.12(g).
"Uncertificated Distributable Certificate Interest": With respect to any
REMIC I Regular Interest, for any Distribution Date, an amount of interest equal
to all Uncertificated Accrued Interest in respect of such REMIC I Regular
Interest for the related Interest Accrual Period, reduced (to not less than
zero) by the product of (i) any Net Aggregate Prepayment Interest Shortfall for
such Distribution Date, multiplied by a fraction, expressed as a decimal, the
numerator of which is the Uncertificated Accrued Interest in respect of such
REMIC I Regular Interest for the related Interest Accrual Period, and the
denominator of which is the aggregate Uncertificated Accrued Interest in respect
of all the REMIC I Regular Interests for the related Interest Accrual Period;
and, with respect to any REMIC II Regular Interest, for any Distribution Date,
an amount of interest equal to all Uncertificated Accrued Interest in respect of
such REMIC II Regular Interest for the related Interest Accrual Period, reduced
(to not less than zero) by the product of (i) any Net Aggregate Prepayment
Interest Shortfall for such Distribution Date, multiplied by a fraction,
expressed as a decimal, the numerator of which is the Uncertificated Accrued
Interest in respect of such REMIC II Regular Interest for the related Interest
Accrual Period, and the denominator of which is the aggregate Uncertificated
Accrued Interest in respect of all the REMIC II Regular Interests for the
related Interest Accrual Period.
"Uncertificated Principal Balance": As defined in Section 2.10(e) with
respect to each REMIC I Regular Interest and in Section 2.12(e) with respect to
each REMIC II Regular Interest.
"Underwriter": Donaldson, Lufkin & Jenrette Securities Corporation or its
successor in interest.
"Union Capital": Union Capital Investments, LLC or its successor in
interest.
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"United States Person": A citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, or an estate
whose income from sources without the United States is includible in gross
income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States, or
a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more United States
persons have the authority to control all substantial decisions of the trust,
all within the meaning of Section 7701(a)(30) of the Code.
"USPAP": The Uniform Standards of Professional Appraisal Practices.
"Voting Rights": The portion of the voting rights evidenced by all of the
Certificates, collectively, which is allocated to any Certificate. At all times
during the term of this Agreement, 99% of the Voting Rights shall be allocated
among all the Classes of Sequential Pay Certificates in proportion to their
respective Class Principal Balances, and 1.0% of the Voting Rights shall be
allocated between the Class CP Certificates and the Class S Certificates in
proportion to their respective Class Notional Amounts. Voting Rights allocated
to a particular Class of Certificates shall be allocated among such Certificates
in proportion to the respective Percentage Interests evidenced thereby.
"Warranting Party": As defined in Section 2.03(a).
"Watch List": As defined in Section 4.02(b).
"Workout Fee": With respect to each Corrected Mortgage Loan, the fee
designated as such and payable to the Special Servicer pursuant to the second
paragraph of Section 3.11(c).
"Workout Fee Rate": With respect to each Corrected Mortgage Loan, 1.25%.
"Yield Maintenance Premium": With respect to any Mortgage Loan, any
premium, penalty or fee paid or payable, as the context requires, by a Mortgagor
in connection with a Principal Prepayment on, or other early collection of
principal of, a Mortgage Loan, other than any Prepayment Premium.
SECTION 1.02. General Interpretive Principles.
For purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires:
(i) the terms defined in this Agreement have the meanings assigned to
them in this Agreement and include the plural as well as the singular, and
the use of any gender herein shall be deemed to include the other gender;
(ii) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting
principles;
(iii) references herein to "Articles", "Sections", "Subsections",
"Paragraphs" and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other
subdivisions of this Agreement;
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(iv) a reference to a Subsection without further reference to a
Section is a reference to such Subsection as contained in the same Section
in which the reference appears, and this rule shall also apply to
Paragraphs and other subdivisions;
(v) the words "herein", "hereof", "hereunder", "hereto", "hereby" and
other words of similar import refer to this Agreement as a whole and not to
any particular provision;
(vi) "or" is not exclusive; and
(vii) the terms "include" and "including" shall mean without
limitation by reason of enumeration.
SECTION 1.03. Certain Calculations in Respect of the Mortgage Pool.
(a) All amounts collected in respect of any Cross-Collateralized Group in
the form of payments from Mortgagors, Insurance Proceeds and Liquidation
Proceeds, shall be applied by the Servicer among the Mortgage Loans constituting
such Cross-Collateralized Group in accordance with the express provisions of the
related loan documents and, in the absence of such express provisions, on a pro
rata basis in accordance with the respective amounts then "due and owing" as to
each such Mortgage Loan. All amounts collected in respect of or allocable to any
particular Mortgage Loan (whether or not such Mortgage Loan constitutes part of
a Cross-Collateralized Group) in the form of payments from Mortgagors,
Liquidation Proceeds or Insurance Proceeds shall be applied to amounts due and
owing under the related Mortgage Note and Mortgage (including for principal and
accrued and unpaid interest) in accordance with the express provisions of the
related Mortgage Note and Mortgage and, in the absence of such express
provisions, shall be applied for purposes of this Agreement: first, as a
recovery of any related and unreimbursed Servicing Advances and, if applicable,
unpaid Liquidation Expenses; second, as a recovery of accrued and unpaid
interest on such Mortgage Loan at the related Mortgage Rate to, but not
including, the date of receipt (or, in the case of a full Monthly Payment from
any Mortgagor, through the related Due Date), exclusive, however, in the case of
an ARD Loan after its Anticipated Repayment Date, of any such accrued and unpaid
interest that constitutes Additional Interest; third, as a recovery of principal
of such Mortgage Loan then due and owing, including by reason of acceleration of
the Mortgage Loan following a default thereunder (or, if a Liquidation Event has
occurred in respect of such Mortgage Loan, as a recovery of principal to the
extent of its entire remaining unpaid principal balance); fourth, as a recovery
of amounts to be currently applied to the payment of, or escrowed for the future
payment of, real estate taxes, assessments, insurance premiums, ground rents (if
applicable) and similar items; fifth, as a recovery of Reserve Funds to the
extent then required to be held in escrow; sixth, as a recovery of any
Prepayment Premium or Yield Maintenance Premium then due and owing under such
Mortgage Loan; seventh, as a recovery of any Default Charges then due and owing
under such Mortgage Loan; eighth, as a recovery of any assumption fees and
modification fees then due and owing under such Mortgage Loan; ninth, as a
recovery of any other amounts then due and owing under such Mortgage Loan other
than remaining unpaid principal and, in the case of an ARD Loan after its
Anticipated Repayment Date, other than Additional Interest; tenth, as a recovery
of any remaining principal of such Mortgage Loan to the extent of its entire
remaining unpaid principal balance; and, eleventh, in the case of an ARD Loan
after its Anticipated Repayment Date, as a recovery of accrued and unpaid
Additional Interest on such ARD Loan to but not including the date of receipt.
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(b) Collections in respect of each REO Property (exclusive of amounts to be
applied to the payment of the costs of operating, managing, maintaining and
disposing of such REO Property) shall be treated: first, as a recovery of any
related and unreimbursed Servicing Advances and, if applicable, unpaid
Liquidation Expenses; second, as a recovery of accrued and unpaid interest on
the related REO Mortgage Loan at the related Mortgage Rate to, but not
including, the Due Date in the Collection Period of receipt, exclusive, however,
in the case of an REO Mortgage Loan that relates to an ARD Loan after its
Anticipated Repayment Date, of any such accrued and unpaid interest that
constitutes Additional Interest; third, as a recovery of principal of the
related REO Mortgage Loan to the extent of its entire unpaid principal balance;
fourth, as a recovery of any Prepayment Premium or Yield Maintenance Premium
deemed to be due and owing in respect of the related REO Mortgage Loan; and
fifth, as a recovery of any other amounts deemed to be due and owing in respect
of the related REO Mortgage Loan.
(c) For the purposes of calculating distributions pursuant to this
Agreement, Additional Interest on an ARD Loan or a successor REO Mortgage Loan
shall be deemed not to constitute principal or any portion thereof and shall not
be added to the unpaid principal balance or Stated Principal Balance of such ARD
Loan or successor REO Mortgage Loan, notwithstanding that the terms of the
related loan documents so permit. To the extent any Additional Interest is not
paid on a current basis, it shall be deemed to be deferred interest.
(d) Insofar as amounts received in respect of any Mortgage Loan or REO
Property and allocable to fees and charges owing in respect of such Mortgage
Loan or the related REO Mortgage Loan, as the case may be, that constitute
Additional Servicing Compensation payable to the Servicer and/or Additional
Special Servicing Compensation payable to the Special Servicer, are insufficient
to cover the full amount of such fees and charges, such amounts shall be
allocated between such of those fees and charges as are payable to the Servicer,
on the one hand, and such of those fees and charges as are payable to the
Special Servicer, on the other, pro rata in accordance with their respective
entitlements.
(e) The foregoing applications of amounts received in respect of any
Mortgage Loan or REO Property shall be determined by the Servicer and reflected
in the appropriate monthly Determination Date Report and Trustee Report.
SECTION 1.04. Cross-Collateralized Mortgage Loans.
Notwithstanding anything herein to the contrary, it is hereby acknowledged
that certain groups of Mortgage Loans identified on the Mortgage Loan Schedule
as being cross-collateralized with each other are, in the case of each such
particular group of Mortgage Loans, evidenced by a single mortgage note and
secured by mortgages, deeds of trust and/or deeds to secure debt on all the
Mortgaged Properties identified on the Mortgage Loan Schedule as corresponding
to such group. Each such Mortgage Loan actually represents a portion of the
entire indebtedness evidenced by the related mortgage note that has been
allocated to the Mortgaged Property identified on the Mortgage Loan Schedule as
corresponding to such Mortgage Loan. Each of the Mortgage Loans constituting
each such group shall be deemed to be a separate Mortgage Loan that is (i)
evidenced by a mortgage note identical to the mortgage note that evidences such
group (but in a principal amount equal to the principal balance allocated to
such Mortgage Loan) and (ii) cross-defaulted and cross-collateralized with each
other Mortgage Loan in such group. In addition, it is hereby acknowledged that
certain other groups of Mortgage Loans identified on the Mortgage Loan Schedule
as being cross-collateralized with each other are, in the case of each such
particular group of Mortgage Loans, by their terms, cross-defaulted and
cross-collateralized with each other. For purposes of reference only in
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this Agreement, and without in any way limiting the servicing rights and powers
of the Servicer and/or the Special Servicer, with respect to any
Cross-Collateralized Mortgage Loan (or successor REO Mortgage Loan), the
Mortgaged Property (or REO Property) that relates or corresponds thereto shall
be the property identified in the Mortgage Loan Schedule as corresponding
thereto. The provisions of this Agreement, including, without limitation, each
of the defined terms set forth in Section 1.01, shall be interpreted in a manner
consistent with this Section 1.04; provided that, if there exists with respect
to any Cross-Collateralized Group only one original of any document referred to
in the definition of "Mortgage File" covering all the Mortgage Loans in such
Cross-Collateralized Group, then the inclusion of the original of such document
in the Mortgage File for any of the Mortgage Loans constituting such
Cross-Collateralized Group shall be deemed an inclusion of such original in the
Mortgage File for each such Mortgage Loan.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES; ORIGINAL ISSUANCE OF REMIC I REGULAR INTERESTS,
REMIC II REGULAR INTERESTS, CLASS CP REMIC III REGULAR INTERESTS,
CLASS S REMIC III REGULAR INTERESTS AND CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans.
(a) It is the intention of the parties hereto that a common law trust be
established pursuant to this Agreement. Norwest Bank Minnesota, National
Association is hereby appointed, and does hereby agree, to act as Trustee
hereunder and, in such capacity, to hold the Trust Fund in trust for the
exclusive use and benefit of all present and future Certificateholders. It is
not intended that this Agreement create a partnership or a joint-stock
association.
(b) The Depositor, concurrently with the execution and delivery hereof,
does hereby sell, assign, transfer and otherwise convey to the Trustee without
recourse for the benefit of the Certificateholders, all the right, title and
interest of the Depositor in, to and under (i) the Original Mortgage Loans, and
all payments under and proceeds of such Mortgage Loans received after the
Closing Date (other than scheduled payments of interest and principal due on or
before the Cut-off Date), together with all documents included in the related
Mortgage Files and any related Additional Collateral; (ii) any REO Property
acquired in respect of any such Mortgage Loan; (iii) such funds or assets as
from time to time are deposited in the Collection Account, the Distribution
Account and, if established, the REO Account; (iv) Sections 2, 3(a), 3(b), 3(d),
4 and 8(f) (and, to the extent related to the foregoing, under Sections 9, 10,
12, 13, 14, 15, 16, 17 and 19) of the Mortgage Loan Purchase and Sale Agreement,
(v) each Third Party Originator Agreement (insofar as such right, title and
interest was assigned thereto under the Mortgage Loan Purchase and Sale
Agreement); and (vi) all other assets included or to be included in the Trust
Fund.
(c) The conveyance of the Mortgage Loans and the related rights and
property accomplished hereby is absolute and is intended by the parties to
constitute an absolute transfer of such Mortgage Loans and such other related
rights and property by the Depositor to the Trustee for the benefit of the
Certificateholders. Furthermore, it is not intended that such conveyance be
deemed a pledge of security for a loan. If such conveyance is deemed to be a
pledge of security for a loan, however, the Depositor intends that the rights
and obligations of the parties to such loan shall be established pursuant to the
terms of this Agreement. The Depositor also intends and agrees that, in such
event, (i) this Agreement shall constitute a security agreement under applicable
law, (ii) the Depositor shall be deemed to have granted to the Trustee (in such
capacity) a first priority security interest in all of the Depositor's right,
title and interest in and to the assets constituting the Trust Fund, including
the Mortgage Loans subject hereto from time to time, all principal and interest
received on or with respect to such Mortgage Loans after the Closing Date (other
than scheduled payments of interest and principal due and payable on such
Mortgage Loans on or prior to the Cut-off Date or, in the case of a Replacement
Mortgage Loan, on or prior to the related date of substitution), all amounts
held from time to time in the Collection Account, the Distribution Account and,
if established, the REO Account and all reinvestment earnings on such amounts,
and all of the Depositor's right, title and interest in and to the proceeds of
any title, hazard or other Insurance Policies related to such Mortgage Loans,
(iii) the possession by the Trustee or its agent of the Mortgage Notes with
respect to the Mortgage Loans subject hereto from time to time and such other
items of property as constitute instruments, money, negotiable documents or
chattel paper shall be deemed to be "possession by the secured party" or
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possession by a purchaser or person designated by such secured party for the
purpose of perfecting such security interest under applicable law, and (iv)
notifications to, and acknowledgments, receipts or confirmations from, Persons
holding such property, shall be deemed to be notifications to, or
acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of the Trustee for the purpose of perfecting
such security interest under applicable law. The Depositor shall file or cause
to be filed, as a precautionary filing, a Form UCC-1 substantially in the form
attached as Exhibit J hereto in all appropriate locations in the State of New
York promptly following the initial issuance of the Certificates, and the
Servicer shall prepare and file at each such office, and the Trustee shall
execute, continuation statements with respect thereto, in each case within six
months prior to the fifth anniversary of the immediately preceding filing. The
Depositor shall cooperate in a reasonable manner with the Trustee and the
Servicer in preparing and filing such continuation statements. This Section
2.01(c) shall constitute notice to the Trustee pursuant to any requirements of
the UCC in effect in New York.
(d) In connection with the Depositor's assignment pursuant to Section
2.01(b) above, the Depositor shall deliver to and deposit with, or cause to be
delivered to and deposited with, the Trustee or a Custodian appointed thereby,
on or before the Closing Date, the Mortgage File and any Additional Collateral
(other than Reserve Funds) for each Original Mortgage Loan so assigned, and the
Depositor shall deliver to the Trustee on or before the Closing Date a fully
executed counterpart of the Mortgage Loan Purchase and Sale Agreement and each
Third Party Originator Agreement; provided that, if all or any portion of the
Mortgage File for any Mortgage Loan is held as of the Closing Date by an
Independent third party, then, in lieu of so delivering to the Trustee or a
Custodian appointed thereby the portion of such Mortgage File so held by an
Independent third party, the Depositor may deliver to the Trustee on or before
the Closing Date a trust receipt or comparable instrument (a "Trust Receipt")
that unconditionally entitles the bearer thereof (and only the bearer thereof)
to claim, without payment of any outstanding debts, the portion of such Mortgage
File so held by an Independent third party (which the Trustee shall do promptly
(and, in any event, within 15 days) following the Closing Date, at the expense
and with the cooperation of the Depositor).
(e) As soon as reasonably possible, and in any event within 30 days after
the later of (i) the Closing Date (or, in the case of a Replacement Mortgage
Loan substituted as contemplated by Section 2.03, after the related date of
substitution) and (ii) the date on which all recording information necessary to
complete the subject document is received by the Trustee, the Trustee shall
complete (to the extent necessary) and cause to be submitted for recording or
filing, as the case may be, in the appropriate office for real property records
or UCC Financing Statements, as applicable, each assignment of Mortgage and
assignment of Assignment of Leases in favor of the Trustee referred to in
clauses (iv) and (v) of the definition of "Mortgage File" that has been received
by the Trustee or a Custodian on its behalf and each UCC-2 and UCC-3 in favor of
the Trustee referred to in clause (viii) of the definition of "Mortgage File"
that has been received by the Trustee or a Custodian on its behalf. Each such
assignment shall reflect that it should be returned by the public recording
office to the Trustee following recording, and each such UCC-2 and UCC-3 shall
reflect that the file copy thereof should be returned to the Trustee following
filing; provided that in those instances where the public recording office
retains the original assignment of Mortgage or assignment of Assignment of
Leases the Trustee shall obtain therefrom a certified copy of the recorded
original. If any such document or instrument is lost or returned unrecorded or
unfiled, as the case may be, because of a defect therein, the Trustee shall
direct the Seller to prepare or cause to be prepared promptly, pursuant to the
Mortgage Loan Purchase and Sale Agreement, a substitute therefor or cure such
defect, as the case may be, and thereafter the Trustee shall, upon receipt
thereof, cause the same to be duly recorded or filed, as appropriate. The
Depositor shall be responsible for paying certain fees and expenses of the
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Trustee in connection with the foregoing, all as more particularly provided for
in that separate agreement dated February 23, 1998, between the Depositor and
the Trustee.
(f) On or before the Closing Date, the Depositor shall deliver to and
deposit with, or cause to be delivered to and deposited with, the Servicer
originals or copies of all financial statements, appraisals,
environmental/engineering reports, leases, rent rolls and tenant estoppels in
the possession or under the control of the Depositor, the Seller or the Third
Party Originators that relate to the Original Mortgage Loans and, to the extent
they are not required to be a part of a Mortgage File in accordance with the
definition thereof, originals or copies of all documents, certificates and
opinions in the possession or under the control of the Depositor, the Seller or
the Third Party Originators that were delivered by or on behalf of the related
Mortgagors in connection with the origination of the Original Mortgage Loans. In
addition, on or before the Closing Date, the Depositor shall deliver to and
deposit with, or cause to be delivered to and deposited with, the Servicer all
unapplied Reserve Funds and Escrow Payments in respect of the Mortgage Loans.
The Servicer shall hold all such documents, records and funds on behalf of the
Trustee in trust for the benefit of the Certificateholders.
SECTION 2.02. Acceptance of Mortgage Assets by Trustee.
(a) The Trustee, by its execution and delivery of this Agreement, hereby
accepts, subject to the other provisions in this Section 2.02, receipt, directly
or through a Custodian on its behalf, of (i) the Original Mortgage Loans and all
documents delivered to it that constitute portions of the related Mortgage Files
or Trust Receipts in respect thereof and (ii) all other assets delivered to it
and included in the Trust Fund, in good faith and without notice of any adverse
claim, and declares that it or a Custodian on its behalf holds and will hold
such documents and any other documents subsequently received by it that
constitute portions of the Mortgage Files, and that it holds and will hold the
Original Mortgage Loans and such other assets, together with any other Mortgage
Loans and assets subsequently delivered to it that are to be included in the
Trust Fund, in trust for the exclusive use and benefit of all present and future
Certificateholders. In connection with the foregoing, the Trustee hereby
certifies to each of the other parties hereto, the Seller and the Underwriter
that, as to each Original Mortgage Loan, except as specifically identified in
the Schedule of Exceptions to Mortgage File Delivery attached hereto as Exhibit
B-2, (i) all documents specified in clauses (i) through (v) and (vii) of the
definition of "Mortgage File" are in its possession or the possession of a
Custodian on its behalf (or, if any such document is missing, the Trustee or a
Custodian on its behalf is in possession of a Trust Receipt covering the missing
document), and (ii) all documents and instruments received by it or any
Custodian with respect to such Mortgage Loan have been reviewed by it or by such
Custodian on its behalf and (A) appear regular on their face (handwritten
additions, changes or corrections shall not constitute irregularities if
initialed by the Mortgagor), (B) appear to have been executed (where
appropriate) and (C) purport to relate to such Mortgage Loan.
(b) On or about the 60th day following the Closing Date (and, if any
exceptions are noted, again on or about the first anniversary of the Closing
Date), the Trustee or a Custodian on its behalf shall review the documents
delivered to it or such Custodian with respect to each Original Mortgage Loan,
and the Trustee shall, subject to Sections 1.04, 2.01, 2.02(c) and 2.02(d),
certify in writing to each of the other parties hereto, the Seller and the
Underwriter that, as to each Original Mortgage Loan then subject to this
Agreement (except as specifically identified in any exception report annexed to
such certification): (i) all documents specified in clauses (i) through (v),
(vii) and (viii) of the definition of "Mortgage File" are in its possession or
the possession of a Custodian on its behalf; (ii) the recordation/filing
contemplated by Section 2.01(e) has been completed (based solely on receipt by
the Trustee of the particular recorded/filed
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documents); (iii) all documents received by it or any Custodian with respect to
such Mortgage Loan have been reviewed by it or by such Custodian on its behalf
and (A) appear regular on their face (handwritten additions, changes or
corrections shall not constitute irregularities if initialed by the Mortgagor),
(B) appear to have been executed (where appropriate) and (C) purport to relate
to such Mortgage Loan; and (iv) based on the examinations referred to in Section
2.02(a) above and this Section 2.02(b) and only as to the foregoing documents,
the information set forth in the Mortgage Loan Schedule with respect to the
items specified in clauses (ii), (v) and (vi)(B) of the definition of "Mortgage
Loan Schedule" accurately reflects the information set forth in the Mortgage
File. If the Seller substitutes a Replacement Mortgage Loan for any Deleted
Mortgage Loan as contemplated by Section 2.03, the Trustee or a Custodian on its
behalf shall review the documents delivered to it or such Custodian with respect
to such Replacement Mortgage Loan, and the Trustee shall deliver a comparable
certification in respect of such Replacement Mortgage Loan, on or about the 30th
day following the related date of substitution (and, if any exceptions are
noted, every 90 days thereafter for so long as any exceptions remain or until
such Replacement Mortgage Loan is removed from the Trust Fund).
(c) None of the Trustee, the Servicer, the Special Servicer or any
Custodian is under any duty or obligation to inspect, review or examine any of
the documents, instruments, certificates or other papers relating to the
Mortgage Loans delivered to it to determine that the same are valid, legal,
effective, genuine, binding, enforceable, sufficient or appropriate for the
represented purpose or that they are other than what they purport to be on their
face. Furthermore, none of the Trustee, the Servicer, the Special Servicer or
any Custodian shall have any responsibility for determining whether the text of
any assignment or endorsement is in proper or recordable form, whether the
requisite recording of any document is in accordance with the requirements of
any applicable jurisdiction, or whether a blanket assignment is permitted in any
applicable jurisdiction.
(d) In performing the reviews contemplated by subsections (a) and (b)
above, the Trustee may conclusively rely on the Seller as to the purported
genuineness of any such document and any signature thereon. It is understood
that the scope of the Trustee's review of the Mortgage Files is limited solely
to confirming that the documents specified in clauses (i) through (v), (vii) and
(viii) of the definition of "Mortgage File" have been received and such
additional information as will be necessary for delivering the certifications
required by subsections (a) and (b) above.
(e) If any party hereto discovers that any document constituting a part of
a Mortgage File has not been properly executed, is missing (other than, for the
first 15 days following the Closing Date, because a Trust Receipt covering such
document was delivered in lieu thereof), contains information that does not
conform in any material respect with the corresponding information set forth in
the Mortgage Loan Schedule (and the terms of such document have not been
modified by written instrument contained in the Mortgage File), or does not
appear to be regular on its face (each, a "Document Defect"), then such party
shall give prompt written notice thereof to the other parties hereto, including
(unless it is the party that discovered the Document Defect) the Trustee. Upon
its discovery or receipt of notice of any such Document Defect, the Servicer
shall notify the Underwriter, the Seller and, in the case of a Third Party
Mortgage Loan, the related Third Party Originator. If any Document Defect is not
corrected within 90 days of such notice, and such Document Defect materially and
adversely affects the value of any Mortgage Loan or the interests of the
Certificateholders therein, the Servicer shall, on behalf of the Trust, exercise
such rights and remedies as it may have hereunder, under the Mortgage Loan
Purchase and Sale Agreement and/or under any Third Party Originator Agreement
with respect to such Document Defect in such manner as it determines, in its
good faith and reasonable judgment, is in the best interests of the
Certificateholders (taken as a collective
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whole). Any and all expenses incurred by the Servicer with respect to the
foregoing, together with any additional out-of-pocket expenses reasonably
incurred by the Servicer or Special Servicer in performing their respective
servicing functions as a result of a Document Defect, shall constitute Servicing
Advances in respect of the affected Mortgage Loan.
SECTION 2.03. Certain Repurchases and Substitutions of Mortgage Loans by
the Originators.
(a) If any party hereto or any Certificateholder discovers a breach of any
representation or warranty relating to any Mortgage Loan set forth in or made
pursuant to the Mortgage Loan Purchase and Sale Agreement or any Third Party
Originator Agreement (a "Breach"), the party or Certificateholder discovering
such Breach shall give prompt written notice thereof to the other parties
hereto. If such Breach materially and adversely affects the value of such
Mortgage Loan or the interests of the Certificateholders therein, then promptly
upon its becoming aware thereof the Servicer shall require that the Person
(whether it is the Seller or a Third Party Originator) that made the breached
representation or warranty (in any event, for purposes of this Section 2.03, the
"Warranting Party"), not later than 90 days (or such other period as is provided
in the Mortgage Loan Purchase and Sale Agreement or the related Third Party
Originator Agreement, as applicable) from the receipt by such Warranting Party
of such notice, cure such Breach in all material respects or repurchase the
affected Mortgage Loan (as, if and to the extent required by the Mortgage Loan
Purchase and Sale Agreement or the related Third Party Originator Agreement, as
applicable) at the applicable Purchase Price (or, in the case of the repurchase
of a Third Party Mortgage Loan by a Third Party Originator, at such other price
as is provided for in the related Third Party Originator Agreement, with any
shortfall between such price and the applicable Purchase Price to be made up by
the Seller pursuant to the Mortgage Loan Purchase and Sale Agreement); provided
that if (i) such Breach does not relate to whether the affected Mortgage Loan is
a "qualified mortgage" within the meaning of Section 860G(a)(3) of the Code,
(ii) such Breach is capable of being cured but not within such 90-day (or other)
period, (iii) such Warranting Party has commenced and is diligently proceeding
with the cure of such Breach within such 90-day (or other) period, and (iv) such
Warranting Party shall have delivered to the Trustee a certification executed on
behalf of such Warranting Party by an officer thereof setting forth the reason
that such Breach is not capable of being cured within an initial 90-day (or
other) period and what actions such Warranting Party is pursuing in connection
with the cure thereof and stating that such Warranting Party anticipates that
such Breach will be cured within an additional period not to exceed 90 more days
(a copy of which certification shall be delivered by the Trustee to the Servicer
and the Special Servicer), then such Warranting Party shall have up to an
additional 90 days to complete such cure; and provided, further, that, in lieu
of effecting any such repurchase (but, in any event, no later than such
repurchase would have to have been completed), such Warranting Party shall be
permitted, during the three-month period following the Closing Date (or during
the two-year period following the Closing Date if the affected Mortgage Loan is
a "defective obligation" within the meaning of Section 860G(a)(4)(B)(ii) of the
Code and Treasury regulation section 1.860G-2(f)), to replace the affected
Mortgage Loan with one or more Qualifying Substitute Mortgage Loans and to pay a
cash amount equal to the applicable Substitution Shortfall Amount (or, in the
case of the replacement of a Third Party Mortgage Loan by a Third Party
Originator, to pay such other cash amount as is provided for in the related
Third Party Originator Agreement, with any shortfall between such other cash
amount and the applicable Substitution Shortfall Amount to be made up by the
Seller pursuant to the Mortgage Loan Purchase and Sale Agreement), subject to
any other applicable terms and conditions of the Mortgage Loan Purchase and Sale
Agreement or the related Third Party Originator Agreement, as the case may be,
and this Agreement. If any substitution for a Deleted Mortgage Loan is not
completed in all respects by the end of the three-month (or, if applicable, the
two-year) period contemplated by the preceding sentence, the Seller or Third
Party Originator that
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desired to effect such substitution shall be barred from doing so (and,
accordingly, will be limited to the cure/repurchase remedies contemplated
hereby), and no party hereto shall be liable thereto for any loss, liability or
expense resulting from the expiration of such period. If any Mortgage Loan is to
be repurchased or replaced as contemplated by this Section 2.03, the Servicer
shall designate the Collection Account as the account to which funds in the
amount of the applicable Purchase Price or Substitution Shortfall Amount (as the
case may be) are to be wired, and the Servicer shall promptly notify the Trustee
when such deposit is made. Any such repurchase or replacement of a Mortgage Loan
shall be on a whole loan, servicing released basis. Notwithstanding the
foregoing, if there exists in respect of any Third Party Mortgage Loan a Breach
on the part of the Seller (other than a Breach of any of the representations and
warranties of the Seller set forth in paragraph 21 of Exhibit C to the Mortgage
Loan Purchase and Sale Agreement) and a Breach on the part of the related Third
Party Originator, and such Breaches give rise to a cure or
repurchase/substitution obligation under both the Mortgage Loan Purchase and
Sale Agreement and the related Third Party Originator Agreement, then the
Servicer shall request the Seller to effect a cure of its Breach or repurchase
or replace the affected Mortgage Loan only if the related Third Party Originator
does not within its applicable cure/repurchase/substitution period cure the
Seller's Breach or repurchase or replace the affected Mortgage Loan, and the
cure/repurchase/substitution period for the Seller will be deemed not to
commence until such request is so made of the Seller; provided that such
cure/repurchase/substitution period for the Seller shall in no event extend
beyond a total of 90 days from the end of the cure/repurchase/substitution
period for the affected Third Party Originator. It is hereby acknowledged and
agreed that if any Breach or Document Defect arises out of a failure to deliver
a Mortgage Note for any Mortgage Loan, such Breach or Document Defect, as the
case may be, shall be cured for purposes of the Agreement if the related
Warranting Party delivers a copy of such Mortgage Note, together with a "lost
note affidavit" certifying that the original of such Mortgage Note has been
lost.
If one or more (but not all) of the Mortgage Loans
constituting a Cross-Collateralized Group are to be repurchased or replaced by
the Seller or a Third Party Originator as contemplated by this Section 2.03,
then, prior to the subject repurchase or substitution, the Servicer shall
prepare and, to the extent necessary and appropriate, have executed by the
related Mortgagor and record, such documentation as may be necessary to
terminate the cross-collateralization between the Mortgage Loans in such
Cross-Collateralized Group that are to be repurchased or replaced, on the one
hand, and the remaining Mortgage Loans therein, on the other hand, such that
those two groups of Mortgage Loans are each secured only by the Mortgaged
Properties identified in the Mortgage Loan Schedule as corresponding thereto;
provided that no such termination shall be effected unless and until the
Servicer and the Trustee have received from the Depositor, the Seller or a Third
Party Originator (i) an Opinion of Counsel to the effect that such termination
will not cause an Adverse REMIC Event to occur with respect to any REMIC Pool
and (ii) written confirmation from each Rating Agency that such termination will
not cause an Adverse Rating Event to occur with respect to any Class of Rated
Certificates. To the extent necessary and appropriate, the Trustee shall execute
(or, subject to Section 3.10, provide the Servicer with a limited power of
attorney that enables the Servicer to execute) the documentation referred to in
the prior sentence. The Servicer shall advance all costs and expenses incurred
by the Trustee and the Servicer pursuant to this paragraph, and such advances
shall constitute and be reimbursable as Servicing Advances. Neither the Servicer
nor the Special Servicer shall be liable to any Certificateholder or any other
party hereto if the cross-collateralization of any Cross-Collateralized Group
cannot be terminated as contemplated by this paragraph for any reason beyond the
control of the Servicer or Special Servicer, as the case may be.
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Whenever one or more mortgage loans are substituted for a Deleted Mortgage
Loan as contemplated by this Section 2.03, the Servicer shall direct the
Warranting Party effecting the substitution to deliver the related Mortgage File
to the Trustee and to certify that such substitute mortgage loan satisfies or
such substitute mortgage loans satisfy, as the case may be, all of the
requirements of the definition of "Qualifying Substitute Mortgage Loan" and to
send such certification to the Trustee. No mortgage loan may be substituted for
a Deleted Mortgage Loan as contemplated by this Section 2.03 if the Mortgage
Loan to be replaced was itself a Replacement Mortgage Loan, in which case,
absent a cure of the relevant Breach or Document Defect, the affected Mortgage
Loan will be required to be repurchased as contemplated hereby. Monthly Payments
due with respect to each Replacement Mortgage Loan (if any) after the related
date of substitution, and Monthly Payments due with respect to each Deleted
Mortgage Loan (if any) after the Cutoff Date and on or prior to the related date
of substitution, shall be part of the Trust Fund. Monthly Payments due with
respect to each Replacement Mortgage Loan (if any) on or prior to the related
date of substitution, and Monthly Payments due with respect to each Deleted
Mortgage Loan (if any) after the related date of substitution, shall not be part
of the Trust Fund and are to be remitted by the Servicer to the Warranting Party
effecting the related substitution promptly following receipt.
If any Mortgage Loan is to be repurchased or replaced as contemplated by
this Section 2.03, the Servicer shall direct the Seller to amend the Mortgage
Loan Schedule to reflect the removal of any Deleted Mortgage Loan and, if
applicable, the substitution of the related Replacement Mortgage Loan(s); and,
upon its receipt of such amended Mortgage Loan Schedule, the Servicer shall
deliver or cause the delivery of such amended Mortgage Loan Schedule to the
other parties hereto. Upon any substitution of one or more Replacement Mortgage
Loans for a Deleted Mortgage Loan, such Replacement Mortgage Loan(s) shall
become part of the Trust Fund and be subject to the terms of this Agreement in
all respects. Amounts due and owing to the Servicer, the Special Servicer, the
Trustee and any Fiscal Agent in respect of unreimbursed Advances and unpaid
Advance Interest relating to a Deleted Mortgage Loan shall be deemed to continue
to be due and owing thereto in respect of any Replacement Mortgage Loan(s)
substituted therefor.
(b) Upon receipt of an Officer's Certificate from the Servicer to the
effect that the full amount of the Purchase Price or Substitution Shortfall
Amount (as the case may be) for any Mortgage Loan repurchased or replaced by the
Seller or a Third Party Originator as contemplated by this Section 2.03 has been
deposited in the Collection Account, and further, if applicable, upon receipt of
the Mortgage File for each Replacement Mortgage Loan (if any) to be substituted
for a Deleted Mortgage Loan, together with the certification referred to in the
second paragraph of Section 2.03(a) from the Warranting Party effecting the
substitution, if any, the Trustee shall: (i) release or cause the release of the
Mortgage File for the Deleted Mortgage Loan to the Person effecting the
repurchase/substitution or its designee and; (ii) execute and deliver such
instruments of release, transfer and/or assignment, in each case without
recourse, as shall be provided to it and are reasonably necessary to vest in the
Person effecting the repurchase/substitution or its designee the ownership of
the Deleted Mortgage Loan. In connection with any such repurchase or
substitution by the Seller or a Third Party Originator, each of the Servicer and
the Special Servicer shall deliver to the Person effecting the
repurchase/substitution or its designee any portion of the related Servicing
File, together with any Escrow Payments, Reserve Funds and Additional
Collateral, held by or on behalf of the Servicer or the Special Servicer, as the
case may be, with respect to the Deleted Mortgage Loan. In connection with any
repurchase or replacement of a Third Party Mortgage Loan by the Seller, the
Trustee shall assign to the Seller all right, title and interest of the Trustee
in respect of such Mortgage Loan under the related Third Party Originator
Agreement.
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(c) The Mortgage Loan Purchase and Sale Agreement and the Third Party
Originator Agreements provide the sole remedies available to the
Certificateholders, or the Trustee on their behalf, respecting any Breach. If
the Seller and/or a Third Party Originator defaults on its obligations to
repurchase or replace any Mortgage Loan as contemplated by this Section 2.03,
the Servicer shall promptly notify the Trustee and the Certificateholders and
shall take such actions on behalf of the Trust with respect to the enforcement
of such repurchase/substitution obligations, including the institution and
prosecution of appropriate legal proceedings, as the Servicer shall determine
are in the best interests of the Certificateholders (taken as a collective
whole). Any and all expenses incurred by the Servicer with respect to the
foregoing shall constitute Servicing Advances in respect of the affected
Mortgage Loan.
SECTION 2.04. Representations and Warranties of the Depositor.
(a) The Depositor hereby represents and warrants to each of the other
parties hereto and for the benefit of the Certificateholders, as of the Closing
Date, that:
(i) The Depositor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware.
(ii) The Depositor's execution and delivery of, performance under, and
compliance with this Agreement, will not violate the Depositor's
organizational documents or constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, or
result in the breach of, any material agreement or other material
instrument to which it is a party or by which it is bound.
(iii) The Depositor has the full power and authority to own its
properties, to conduct its business as presently conducted by it and to
enter into and consummate all transactions contemplated by this Agreement,
has duly authorized the execution, delivery and performance of this
Agreement, and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid, legal
and binding obligation of the Depositor, enforceable against the Depositor
in accordance with the terms hereof, subject to (A) applicable bankruptcy,
insolvency, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally, and (B) general principles of
equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(v) The Depositor is not in violation of, and its execution and
delivery of, performance under and compliance with this Agreement will not
constitute a violation of, any law, any order or decree of any court or
arbiter, or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the Depositor's
good faith and reasonable judgment, is likely to affect materially and
adversely either the ability of the Depositor to perform its obligations
under this Agreement or the financial condition of the Depositor.
(vi) No consent, approval, authorization or order of any state or
federal court or governmental agency or body is required for the
consummation by the Depositor of the transactions contemplated herein,
except (A) for those consents, approvals, authorizations
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or orders that previously have been obtained, (B) such as may be required
under the blue sky laws of any jurisdiction in connection with the purchase
and sale of the Certificates by the Underwriter, and (C) any recordation of
the assignments of Mortgage Loan documents to the Trustee pursuant to
Section 2.01(e), which has not yet been completed.
(vii) The transfer of the Mortgage Loans to the Trustee as
contemplated herein requires no regulatory approval, other than any such
approvals as have been obtained, and is not subject to any bulk transfer or
similar law in effect in any applicable jurisdiction.
(viii) No litigation is pending or, to the best of the Depositor's
knowledge, threatened against the Depositor that, if determined adversely
to the Depositor, would prohibit the Depositor from entering into this
Agreement or that, in the Depositor's good faith and reasonable judgment,
is likely to materially and adversely affect either the ability of the
Depositor to perform its obligations under this Agreement or the financial
condition of the Depositor.
(ix) Immediately prior to the transfer of the Original Mortgage Loans
to the Trustee for the benefit of the Certificateholders pursuant to this
Agreement, the Depositor had good and marketable title to, and was the sole
owner and holder of, each such Mortgage Loan; and the Depositor has full
right and authority to sell, assign and transfer the Mortgage Loans.
(x) The Depositor is transferring the Original Mortgage Loans to the
Trustee for the benefit of the Certificateholders free and clear of any and
all liens, pledges, charges and security interests created by or through
the Depositor.
(b) The representations and warranties of the Depositor set forth in
Section 2.04(a) shall survive the execution and delivery of this Agreement and
shall inure to the benefit of the Persons for whose benefit they were made for
so long as the Trust remains in existence. Upon discovery by any party hereto of
any breach of any of the foregoing representations and warranties, the party
discovering such breach shall give prompt written notice thereof to the other
parties hereto.
SECTION 2.05. Representations and Warranties of the Servicer.
(a) The Servicer hereby represents and warrants to each of the other
parties hereto and for the benefit of the Certificateholders, as of the Closing
Date, that:
(i) The Servicer is a limited liability company duly organized,
validly existing and in good standing under the laws of the State of
Delaware and is 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 and to perform its obligations under
this Agreement.
(ii) The Servicer's execution and delivery of, performance under and
compliance with this Agreement, will not violate the Servicer's
organizational documents or constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default)
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under, or result in the breach of, any material agreement or other material
instrument to which it is a party or by which it is bound.
(iii) The Servicer has the full power and authority to enter into and
consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement, and
has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid, legal
and binding obligation of the Servicer, enforceable against the Servicer in
accordance with the terms hereof, subject to (A) applicable bankruptcy,
insolvency, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally, and (B) general principles of
equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(v) The Servicer is not in violation of, and its execution and
delivery of, performance under and compliance with this Agreement will not
constitute a violation of, any law, any order or decree of any court or
arbiter, or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the Servicer's
good faith and reasonable judgment, is likely to affect materially and
adversely either the ability of the Servicer to perform its obligations
under this Agreement or the financial condition of the Servicer.
(vi) No consent, approval, authorization or order of any state or
federal court or governmental agency or body is required for the
consummation by the Servicer of the transactions contemplated herein,
except for those consents, approvals, authorizations or orders that
previously have been obtained.
(vii) No litigation is pending or, to the best of the Servicer's
knowledge, threatened against the Servicer that, if determined adversely to
the Servicer, would prohibit the Servicer from entering into this Agreement
or that, in the Servicer's good faith and reasonable judgment, is likely to
materially and adversely affect either the ability of the Servicer to
perform its obligations under this Agreement or the financial condition of
the Servicer.
(viii) Each officer, director or employee of the Servicer with
responsibilities concerning the servicing and administration of any
Mortgage Loan is covered by errors and omissions insurance in the amounts
and with the coverage required by Section 3.07(c).
(ix) There is no event, condition or circumstance in existence that
constitutes (or, with notice or lapse of time, or both, would constitute)
an Event of Default on the part of the Servicer.
(x) The Servicing Fee is reasonable in light of the duties and
obligations of the Servicer.
(xi) The Servicer has examined each of the Sub-Servicing Agreements
that will be in effect as of the Closing Date with respect to the Mortgage
Loans, and each such Sub-
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Servicing Agreement complies with the requirements of Section 3.22(a) in
all material respects.
(b) The representations and warranties of the Servicer set forth in Section
2.05(a) shall survive the execution and delivery of this Agreement and shall
inure to the benefit of the Persons for whose benefit they were made for so long
as the Trust remains in existence. Upon discovery by any party hereto of any
breach of any of the foregoing representations and warranties, the party
discovering such breach shall give prompt written notice thereof to the other
parties hereto.
(c) Any successor Servicer shall be deemed to have made, as of the date of
its succession, each of the representations and warranties set forth in Section
2.05(a), subject to such appropriate modifications to the representation and
warranty set forth in Section 2.05(a)(i) to accurately reflect such successor's
jurisdiction of organization and whether it is a corporation, partnership, bank,
association or other type of organization.
SECTION 2.06. Representations and Warranties of the Special Servicer.
(a) The Special Servicer hereby represents and warrants to each of the
other parties hereto and for the benefit of the Certificateholders, as of the
Closing Date, that:
(i) The Special Servicer is a limited liability company duly
organized, validly existing and in good standing under the laws of the
State of New York and is in compliance with the laws of each State in which
any Mortgaged Property is located to the extent necessary to perform its
obligations under this Agreement.
(ii) The Special Servicer's execution and delivery of, performance
under and compliance with this Agreement, will not violate the Special
Servicer's organizational documents or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default)
under, or result in the breach of, any material agreement or other material
instrument to which it is a party or by which it is bound.
(iii) The Special Servicer has the full power and authority to enter
into and consummate all transactions contemplated by this Agreement, has
duly authorized the execution, delivery and performance of this Agreement,
and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid, legal
and binding obligation of the Special Servicer, enforceable against the
Special Servicer in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, reorganization, moratorium and other
laws affecting the enforcement of creditors' rights generally, and (B)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
(v) The Special Servicer is not in violation of, and its execution and
delivery of, performance under and compliance with the terms of this
Agreement will not constitute a violation of, any law, any order or decree
of any court or arbiter, or any order, regulation or demand of any federal,
state or local governmental or regulatory authority, which violation,
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in the Special Servicer's good faith and reasonable judgment, is likely to
affect materially and adversely either the ability of the Special Servicer
to perform its obligations under this Agreement or the financial condition
of the Special Servicer.
(vi) No consent, approval, authorization or order of any state or
federal court or governmental agency or body is required for the
consummation by the Special Servicer of the transactions contemplated
herein, except for those consents, approvals, authorizations or orders that
previously have been obtained.
(vii) No litigation is pending or, to the best of the Special
Servicer's knowledge, threatened against the Special Servicer that, if
determined adversely to the Special Servicer, would prohibit the Special
Servicer from entering into this Agreement or that, in the Special
Servicer's good faith and reasonable judgment, is likely to materially and
adversely affect either the ability of the Special Servicer to perform its
obligations under this Agreement or the financial condition of the Special
Servicer.
(viii) Each officer, director or employee of the Special Servicer with
responsibilities concerning the servicing and administration of any
Specially Serviced Mortgage Loan or REO Property is covered by errors and
omissions insurance in the amounts and with the coverage required by
Section 3.07(c).
(ix) There is no event, condition or circumstance in existence that
constitutes (or, with notice or lapse of time, or both, would constitute)
an Event of Default on the part of the Special Servicer.
(x) The Special Servicing Fee, Workout Fee and Liquidation Fee are
reasonable in light of the duties and obligations of the Special Servicer.
(b) The representations and warranties of the Special Servicer set forth in
Section 2.06(a) shall survive the execution and delivery of this Agreement and
shall inure to the benefit of the Persons for whose benefit they were made for
so long as the Trust remains in existence. Upon discovery by any party hereto of
any breach of any of the foregoing representations and warranties, the party
discovering such breach shall give prompt written notice thereof to the other
parties hereto.
(c) Any successor Special Servicer shall be deemed to have made, as of the
date of its succession, each of the representations and warranties set forth in
Section 2.06(a), subject to such appropriate modifications to the representation
and warranty set forth in Section 2.06(a)(i) to accurately reflect such
successor's jurisdiction of organization and whether it is a corporation,
partnership, bank, association or other type of organization.
SECTION 2.07. Representations and Warranties of the Trustee.
(a) The Trustee hereby represents and warrants to, and covenants with, each
of the other parties hereto and for the benefit of the Certificateholders, as of
the Closing Date, that:
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(i) The Trustee is duly organized, validly existing and in good
standing as a national banking association under the laws of the United
States and is, shall be or, if necessary, shall appoint a co-trustee that
is, 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 and to perform its obligations under this Agreement.
(ii) The Trustee's execution and delivery of, performance under and
compliance with this Agreement, will not violate the Trustee's
organizational documents or constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, or
result in a material breach of, any material agreement or other material
instrument to which it is a party or by which it is bound.
(iii) The Trustee has the full power and authority to enter into and
consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement, and
has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid, legal
and binding obligation of the Trustee, enforceable against the Trustee in
accordance with the terms hereof, subject to (A) applicable bankruptcy,
insolvency, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally and the rights of creditors of
banks, and (B) general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
(v) The Trustee is not in violation of, and its execution and delivery
of, performance under and compliance with this Agreement will not
constitute a violation of, any law, any order or decree of any court or
arbiter, or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the Trustee's
good faith and reasonable judgment, is likely to affect materially and
adversely either the ability of the Trustee to perform its obligations
under this Agreement or the financial condition of the Trustee.
(vi) No consent, approval, authorization or order of any state or
federal court or governmental agency or body is required for the
consummation by the Trustee of the transactions contemplated herein, except
for those consents, approvals, authorizations or orders that previously
have been obtained.
(vii) No litigation is pending or, to the best of the Trustee's
knowledge, threatened against the Trustee that, if determined adversely to
the Trustee, would prohibit the Trustee from entering into this Agreement
or that, in the Trustee's good faith and reasonable judgment, is likely to
materially and adversely affect either the ability of the Trustee to
perform its obligations under this Agreement or the financial condition of
the Trustee.
(viii) The Trustee is eligible to act as trustee hereunder in
accordance with Section 8.06.
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(b) The representations and warranties of the Trustee set forth in Section
2.07(a) shall survive the execution and delivery of this Agreement and shall
inure to the benefit of the Persons for whose benefit they were made for so long
as the Trust remains in existence. Upon discovery by any party hereto of any
breach of any of the foregoing representations, warranties and covenants, the
party discovering such breach shall give prompt written notice thereof to the
other parties hereto.
(c) Any successor Trustee shall be deemed to have made, as of the date of
its succession, each of the representations and warranties set forth in Section
2.07(a), subject to such appropriate modifications to the representation and
warranty set forth in Section 2.07(a)(i) to accurately reflect such successor's
jurisdiction of organization and whether it is a corporation, partnership, bank,
association or other type of organization.
SECTION 2.08. Representations and Warranties of the REMIC Administrator.
(a) The REMIC Administrator hereby represents and warrants to each of the
other parties hereto and for the benefit of the Certificateholders, as of the
Closing Date, that:
(i) The REMIC Administrator is duly organized, validly existing and in
good standing as a national banking association under the laws of the
United States.
(ii) The REMIC Administrator's execution and delivery of, performance
under and compliance with this Agreement, will not violate the REMIC
Administrator's organizational documents or constitute a default (or an
event which, with notice or lapse of time, or both, would constitute a
default) under, or result in a material breach of, any material agreement
or other material instrument to which it is a party or by which it is
bound.
(iii) The REMIC Administrator has the full power and authority to
enter into and consummate all transactions contemplated by this Agreement,
has duly authorized the execution, delivery and performance of this
Agreement, and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid, legal
and binding obligation of the REMIC Administrator, enforceable against the
REMIC Administrator in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, reorganization, moratorium and other
laws affecting the enforcement of creditors' rights generally and the
rights of creditors of banks, and (B) general principles of equity,
regardless of whether such enforcement is considered in a proceeding in
equity or at law.
(v) The REMIC Administrator is not in violation of, and its execution
and delivery of, performance under and compliance with this Agreement will
not constitute a violation of, any law, any order or decree of any court or
arbiter, or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the REMIC
Administrator's good faith and reasonable judgment, is likely to affect
materially and adversely either the ability of the REMIC Administrator to
perform its obligations under this Agreement or the financial condition of
the REMIC Administrator.
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(vi) No consent, approval, authorization or order of any state or
federal court or governmental agency or body is required for the
consummation by the REMIC Administrator of the transactions contemplated
herein, except for those consents, approvals, authorizations or orders that
previously have been obtained.
(vii) No litigation is pending or, to the best of the REMIC
Administrator's knowledge, threatened against the REMIC Administrator that,
if determined adversely to the REMIC Administrator, would prohibit the
REMIC Administrator from entering into this Agreement or that, in the REMIC
Administrator's good faith and reasonable judgment, is likely to materially
and adversely affect either the ability of the REMIC Administrator to
perform its obligations under this Agreement or the financial condition of
the REMIC Administrator.
(viii) There is no event, condition or circumstance in existence that
constitutes (or, with notice or lapse of time, or both, would constitute)
an Event of Default on the part of the REMIC Administrator.
(b) The representations and warranties of the REMIC Administrator set forth
in Section 2.08(a) shall survive the execution and delivery of this Agreement
and shall inure to the benefit of the Persons for whose benefit they were made
for so long as the Trust remains in existence. Upon discovery by any party
hereto of any breach of any of the foregoing representations and warranties, the
party discovering such breach shall give prompt written notice thereof to the
other parties hereto.
(c) Any successor REMIC Administrator shall be deemed to have made, as of
the date of its succession, each of the representations and warranties set forth
in Section 2.08(a), subject to such appropriate modifications to the
representation and warranty set forth in Section 2.08(a)(i) to accurately
reflect such successor's jurisdiction of organization and whether it is a
corporation, partnership, bank, association or other type of organization.
SECTION 2.09. Designation of the Certificates.
(a) The Certificates shall consist of 17 Classes hereby designated as the
"Class CP Certificates", the "Class S Certificates", the "Class A-1A
Certificates", the "Class A-1B Certificates", the "Class A-2 Certificates", the
"Class A-3 Certificates", the "Class B-1 Certificates", the "Class B-2
Certificates", the "Class B-3 Certificates", the "Class B-4 Certificates", the
"Class B-5 Certificates", the "Class B-6 Certificates", the "Class B-7
Certificates", the "Class C Certificates", the "Class R-I Certificates", the
"Class R-II Certificates" and the "Class R-III Certificates", respectively.
(b) The Class A-1A, Class A-1B, Class A-2 and Class A-3 Certificates are
collectively designated as the "Class A Certificates".
(c) The Class B-1, Class B-2, Class B-3, Class B-4, Class B-5, Class B-6
and Class B-7 Certificates are collectively designated as the "Class B
Certificates".
(d) The Class CP, Class S, Class A-1A and Class A-1B Certificates are
collectively designated as the "Senior Certificates".
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(e) The Class A-2, Class A-3, Class B, Class C, Class R-I, Class R-II and
Class R-III Certificates are collectively designated as the "Subordinated
Certificates".
(f) The Class A, Class B and Class C Certificates are collectively
designated as the "Sequential Pay Certificates".
(g) The Class CP and Class S Certificates are collectively designated as
the "Interest Only Certificates".
(h) The Interest Only Certificates and the Sequential Pay Certificates are
collectively designated as the "Regular Interest Certificates".
(i) The Class R-I, Class R-II and Class R-III Certificates are collectively
designated as the "Residual Interest Certificates".
(j) The Regular Interest Certificates and the Class R-III Certificates are
collectively designated as the "REMIC III Certificates".
SECTION 2.10. Creation of REMIC I; Issuance of REMIC I Regular Interests
and Class R-I Certificates.
(a) It is the intention of the parties hereto that the following segregated
pool of assets constitute a REMIC for federal income tax purposes, and that such
segregated pool of assets be designated as "REMIC I": (i) the Mortgage Loans
that are from time to time subject to this Agreement and all payments under and
proceeds of such Mortgage Loans received after the Closing Date or, in the case
of a Replacement Mortgage Loan, after the related date of substitution (other
than scheduled payments of interest and principal due on or before the Cut-off
Date or, in the case of a Replacement Mortgage Loan, on or before the related
date of substitution), together with all documents included in the related
Mortgage Files and Servicing Files and any related Additional Collateral; (ii)
any REO Property acquired in respect of any such Mortgage Loan; (iii) such funds
and assets as from time to time are deposited in the Collection Account, the
Distribution Account and, if established, the REO Account; (iv) the rights of
the Depositor under Sections 2, 3(a), 3(b), 3(d), 4 and 8(f) (and, to the extent
related to the foregoing, under Sections 9, 10, 12, 13, 14, 15, 16, 17 and 19)
of the Mortgage Loan Purchase and Sale Agreement; (v) the rights of the Trustee
and the Certificateholders as third party beneficiaries under the Mortgage Loan
Purchase and Sale Agreement (as and to the extent provided under Section 11
thereof); and (vi) the rights of the Depositor under the Third Party Originator
Agreements (insofar as such rights were assigned thereto under the Mortgage Loan
Purchase and Sale Agreement). The Closing Date is hereby designated as the
"Startup Day" of REMIC I within the meaning of Section 860G(a)(9) of the Code.
(b) Concurrently with the assignment of the Original Mortgage Loans and
certain related assets to the Trustee pursuant to Section 2.01(b) and in
exchange therefor, the REMIC I Regular Interests shall be issued, and the
Trustee, pursuant to the written request of the Depositor executed by an officer
of the Depositor, shall execute, authenticate and deliver to or upon the order
of the Depositor, the Class R-I Certificates in authorized denominations. A
separate REMIC I Regular Interest shall be issued with respect to each Original
Mortgage Loan. For purposes of this Agreement, each REMIC I Regular Interest
shall relate to the Original Mortgage Loan in respect of which it was issued, to
each Replacement Mortgage Loan (if any) substituted for such Original Mortgage
Loan, and to each REO Mortgage Loan deemed outstanding
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with respect to an REO Property (if any) acquired in respect of such Original
Mortgage Loan or any such Replacement Mortgage Loan. None of the REMIC I Regular
Interests shall be certificated. The interests evidenced by the Class R-I
Certificates, together with the REMIC I Regular Interests, shall constitute the
entire beneficial ownership of REMIC I.
(c) The REMIC I Regular Interests shall constitute the "regular interests"
(within the meaning of Section 860G(a)(1) of the Code), and the Class R-I
Certificates shall constitute the sole class of "residual interests" (within the
meaning of Section 860G(a)(2) of the Code), in REMIC I. None of the parties
hereto, to the extent it is within the control thereof, shall create or permit
the creation of any other "interests" in REMIC I (within the meaning of Treasury
regulation section 1.860D-1(b)(1)).
(d) The designation for each REMIC I Regular Interest shall be the loan
number for the related Original Mortgage Loan set forth in the Mortgage Loan
Schedule.
(e) Each REMIC I Regular Interest shall have a principal balance (herein
referred to as its "Uncertificated Principal Balance"). As of the Closing Date,
the Uncertificated Principal Balance of each REMIC I Regular Interest shall
equal the Cut-off Date Balance of the related Original Mortgage Loan (as
specified in the Mortgage Loan Schedule). On each Distribution Date, the
Uncertificated Principal Balance of each REMIC I Regular Interest shall be
permanently reduced by any distributions of principal deemed made in respect of
such REMIC I Regular Interest on such Distribution Date pursuant to Section
4.01(i) and, further, by any Realized Losses and/or Additional Trust Fund
Expenses deemed allocated to such REMIC I Regular Interest on such Distribution
Date pursuant to Section 4.04(c). Except as provided in the preceding sentence,
the Uncertificated Principal Balance of each REMIC I Regular Interest shall not
otherwise be increased or reduced. Deemed distributions in reimbursement of
REMIC II with respect to any REMIC I Regular Interest for previously allocated
Realized Losses and Additional Trust Fund Expenses shall not constitute deemed
distributions of principal and shall not result in any reduction of the
Uncertified Principal Balance of such REMIC I Regular Interest.
(f) As provided below, each REMIC I Regular Interest shall bear interest,
such interest to accrue on its Uncertificated Principal Balance outstanding from
time to time. The per annum rate at which each REMIC I Regular Interest shall
accrue interest during each Interest Accrual Period is herein referred to as its
"REMIC I Remittance Rate". If, as of the Closing Date, the related Original
Mortgage Loan bears interest calculated on the basis of a 360-day year
consisting of twelve 30-day months, then the REMIC I Remittance Rate in respect
of any particular REMIC I Regular Interest for any Interest Accrual Period shall
equal the Mortgage Rate in effect for the related Original Mortgage Loan as of
the Closing Date, minus __ basis points; and if, as of the Closing Date, the
related Original Mortgage Loan does not bear interest calculated on the basis of
a 360-day year consisting of twelve 30-day months, then the REMIC I Remittance
Rate in respect of any particular REMIC I Regular Interest for any Interest
Accrual Period shall equal (i) a fraction (expressed as a percentage), the
numerator of which is the product of twelve times the aggregate amount of
interest that would accrue during such Interest Accrual Period on the
Uncertificated Principal Balance of such REMIC I Regular Interest outstanding
immediately prior to the related Distribution Date if such interest were
calculated (A) at the Mortgage Rate in effect for the related Original Mortgage
Loan as of the Closing Date and (B) on the same Interest Accrual Basis as is
applicable to the related Original Mortgage Loan, and the denominator of which
is the Uncertificated Principal Balance of such REMIC I Regular Interest
outstanding immediately prior to the related Distribution Date, minus (ii) 10
basis points.
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(g) The Uncertificated Accrued Interest in respect of each REMIC I Regular
Interest shall commence accruing on the Cut-off Date and, during each Interest
Accrual Period, shall accrue at the applicable REMIC I Remittance Rate on the
Uncertificated Principal Balance of such REMIC I Regular Interest outstanding
immediately prior to the related Distribution Date. The Uncertificated Accrued
Interest in respect of each REMIC I Regular Interest shall be calculated on the
basis of a 360-day year consisting of twelve 30-day months. Notwithstanding the
foregoing, the portion of the Uncertificated Accrued Interest in respect of any
REMIC I Regular Interest for any Interest Accrual Period that may be deemed
distributable to REMIC II with respect to such REMIC I Regular Interest pursuant
to Section 4.01(i) shall not exceed the Uncertificated Distributable Interest in
respect of such REMIC I Regular Interest for the related Distribution Date.
(h) Solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each REMIC I
Regular Interest shall be the first Distribution Date that follows the Stated
Maturity Date for the related Original Mortgage Loan.
(i) The Class R-I Certificates shall not have principal balances and shall
not bear interest.
SECTION 2.11. Conveyance of REMIC I Regular Interests; Acceptance of REMIC
I Regular Interests by Trustee.
The Depositor, as of the Closing Date, and concurrently with the execution
and delivery of this Agreement, does hereby assign without recourse all the
right, title and interest of the Depositor in and to the REMIC I Regular
Interests to the Trustee for the benefit of the Holders of the Class R-II and
REMIC III Certificates. The Trustee acknowledges the assignment to it of the
REMIC I Regular Interests and declares that it holds and will hold the same in
trust for the exclusive use and benefit of all present and future Holders of the
Class R-II and REMIC III Certificates.
SECTION 2.12. Creation of REMIC II; Issuance of REMIC II Regular Interests
and Class R-II Certificates.
(a) It is the intention of the parties hereto that the segregated pool of
assets consisting of the REMIC I Regular Interests constitute a REMIC for
federal income tax purposes, and that such segregated pool of assets be
designated as "REMIC II". The Closing Date is hereby designated as the "Startup
Day" of REMIC II within the meaning of Section 860G(a)(9) of the Code.
(b) Concurrently with the assignment of the REMIC I Regular Interests to
the Trustee pursuant to Section 2.11 and in exchange therefor, the REMIC II
Regular Interests shall be issued, and the Trustee, pursuant to the written
request of the Depositor executed by an officer of the Depositor, shall execute,
authenticate and deliver to or upon the order of the Depositor, the Class R-II
Certificates in authorized denominations. There shall be 13 separate REMIC II
Regular Interests, and none of the REMIC II Regular Interests shall be
certificated.
(c) The REMIC II Regular Interests shall constitute the "regular interests"
(within the meaning of Section 860G(a)(1) of the Code), and the Class R-II
Certificates shall constitute the sole class of "residual interests" (within the
meaning of Section 860G(a)(2) of the Code), in REMIC II. None of the parties
hereto, to the extent it is within the control thereof, shall create or permit
the creation of any other "interests" in REMIC II (within the meaning of
Treasury regulation section 1.860D-1(b)(1)).
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(d) The REMIC II Regular Interests are hereby designated as "REMIC II
Regular Interest A-1A", "REMIC II Regular Interest A-1B1", "REMIC II Regular
Interest A-1B2", "REMIC II Regular Interest A-2", "REMIC II Regular Interest
A-3", "REMIC II Regular Interest B-1", "REMIC II Regular Interest B-2","REMIC II
Regular Interest B-3","REMIC II Regular Interest B-4", "REMIC II Regular
Interest B-5", "REMIC II Regular Interest B-6", "REMIC II Regular Interest B-7"
and "REMIC II Regular Interest C", respectively.
(e) Each REMIC II Regular Interest shall have a principal balance (herein
referred to as its "Uncertificated Principal Balance"). The following table sets
forth for each REMIC II Regular Interest the initial Uncertificated Principal
Balance thereof and, solely for purposes of satisfying Treasury regulation
section 1.860G-1(a)(4)(iii), the "latest possible maturity date" thereof
(calculated based on the Maturity Assumptions):
Designation of Initial Uncertificated Latest Possible
REMIC II Regular Interest Principal Balance Maturity Date
- - ------------------------- ----------------- -------------
A-1A $125,000,000 October 15, 2006
A-1B1 $141,300,000 October 15, 2007
A-1B2 $325,000,000 February 15, 2008
A-2 $50,400,000 February 15, 2008
A-3 $50,300,000 February 15, 2008
B-1 $41,900,000 November 15, 2009
B-2 $14,700,000 January 15, 2010
B-3 $10,000,000 June 15, 2010
B-4 $27,100,000 January 15, 2013
B-5 $15,000,000 September 15, 2017
B-6 $15,000,000 November 15, 2017
B-7 $6,300,000 November 15, 2017
C $16,800,140 January 15, 2018
On each Distribution Date, the Uncertificated Principal Balance of each
REMIC II Regular Interest shall be permanently reduced by any distributions of
principal deemed made in respect of such REMIC II Regular Interest on such
Distribution Date pursuant to Section 4.01(h) and, further, by any Realized
Losses and/or Additional Trust Fund Expenses deemed allocated to such REMIC II
Regular Interest on such Distribution Date pursuant to Section 4.04(b). Except
as provided in the preceding sentence, the Uncertificated Principal Balance of
each REMIC II Regular Interest shall not otherwise be increased or decreased.
Deemed distributions in reimbursement of REMIC III with respect to any REMIC II
Regular Interest for previously allocated Realized Losses and Additional Trust
Fund Expenses shall not constitute deemed distributions of principal and shall
not result in any reduction of the Uncertificated Principal Balance of such
REMIC II Regular Interest.
(f) As provided below, each REMIC II Regular Interest shall bear interest,
such interest to accrue on its Uncertificated Principal Balance outstanding from
time to time. The per annum rate at which each REMIC II Regular Interest shall
accrue interest is herein referred to as its "REMIC II Remittance Rate". The
REMIC II Remittance Rate for each REMIC II Regular Interest shall be variable
and, with respect to any Interest Accrual Period, shall equal the weighted
average, expressed as a percentage and rounded to eight decimal places, of the
respective REMIC I Remittance Rates in effect for all the REMIC I Regular
Interests
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for such Interest Accrual Period, weighted on the basis of the respective
Uncertificated Principal Balances of such REMIC I Regular Interests outstanding
immediately prior to the related Distribution Date.
(g) The Uncertificated Accrued Interest in respect of each REMIC II Regular
Interest shall commence accruing on the Cut-off Date and, during each Interest
Accrual Period, shall accrue at the applicable REMIC II Remittance Rate on the
Uncertificated Principal Balance of such REMIC II Regular Interest outstanding
immediately prior to the related Distribution Date. The Uncertificated Accrued
Interest in respect of each REMIC II Regular Interest shall be calculated on the
basis of a 360-day year consisting of twelve 30-day months. Notwithstanding the
foregoing, the portion of the Uncertificated Accrued Interest in respect of any
REMIC II Regular Interest for any Interest Accrual Period that may be deemed
distributable to REMIC III with respect to such REMIC II Regular Interest
pursuant to Section 4.01(h) shall not exceed the Uncertificated Distributable
Interest in respect of such REMIC II Regular Interest for the related
Distribution Date.
(h) The Class R-II Certificates shall not have principal balances and shall
not bear interest.
SECTION 2.13. Conveyance of REMIC II Regular Interests; Acceptance of REMIC
II Regular Interests by Trustee.
The Depositor, as of the Closing Date, and concurrently with the execution
and delivery of this Agreement, does hereby assign without recourse all the
right, title and interest of the Depositor in and to the REMIC II Regular
Interests to the Trustee for the benefit of the Holders of the REMIC III
Certificates. The Trustee acknowledges the assignment to it of the REMIC II
Regular Interests and declares that it holds and will hold the same in trust for
the exclusive use and benefit of all present and future Holders of the REMIC III
Certificates.
SECTION 2.14. Creation of REMIC III; Issuance of REMIC III Certificates.
(a) It is the intention of the parties hereto that the segregated pool of
assets consisting of the REMIC II Regular Interests constitute a REMIC for
federal income tax purposes, and that such segregated pool of assets be
designated as "REMIC III". The Closing Date is hereby designated as the "Startup
Day" of REMIC III within the meaning of Section 860G(a)(9) of the Code.
(b) Concurrently with the assignment of the REMIC III Regular Interests to
the Trustee pursuant to Section 2.13 and in exchange therefor, the Trustee shall
execute, authenticate and deliver to or upon the order of the Depositor, the
REMIC III Certificates in authorized denominations evidencing the entire
beneficial ownership of REMIC III. The Class CP Certificates shall actually
represent five separate beneficial ownership interests in REMIC III (together,
the "Class CP REMIC III Regular Interests"), and the Class S Certificates shall
actually represent 13 separate beneficial ownership interests in REMIC III
(together, the "Class S REMIC III Regular Interests").
(c) The Class A-1A, Class A-1B, Class A-2, Class A-3, Class B-1, Class B-2,
Class B-3, Class B-4, Class B-5, Class B-6, Class B-7 and Class C Certificates,
together with the Class CP REMIC III Regular Interests represented by the Class
CP Certificates and the Class S REMIC III Regular Interests represented by the
Class S Certificates, shall constitute the "regular interests" (within the
meaning of Section 860G(a)(1) of the Code), and the Class R-III Certificates
shall constitute the sole class of "residual interests" (within the meaning of
Section 860(G)(a)(2) of the Code), in REMIC III. None of the parties hereto, to
the
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extent it is within the control thereof, shall create or permit the creation of
any other "interests" in REMIC III within the meaning of Treasury regulation
section 1.860D-1(b)(1)).
(d) The Class CP REMIC III Regular Interests are hereby designated as
"REMIC III Regular Interest CP-A-1B2", "REMIC III Regular Interest CP-A-2",
"REMIC III Regular Interest CP-A-3", "REMIC III Regular Interest CP-B-1" and
"REMIC III Regular Interest CP-B-2", respectively. The Class S REMIC III Regular
Interests are hereby designated as "REMIC III Regular Interest S-A-1A", "REMIC
III Regular Interest S-A-1B1", "REMIC III Regular Interest S-A-1B2", "REMIC III
Regular Interest S-A-2", "REMIC III Regular Interest S-A-3", "REMIC III Regular
Interest S-B-1", "REMIC III Regular Interest S- B-2", "REMIC III Regular
Interest S-B-3", "REMIC III Regular Interest S-B-4", "REMIC III Regular Interest
S-B-5", "REMIC III Regular Interest S-B-6", "REMIC III Regular Interest S-B-7"
and "REMIC III Regular Interest S-C", respectively.
The Class CP REMIC III Regular Interests (and, accordingly, the Class CP
Certificates) shall not have principal balances. Likewise, the Class S REMIC III
Regular Interests (and, accordingly, the Class S Certificates) shall not have
principal balances. As provided below, however, each Class CP REMIC III Regular
Interest and each Class S REMIC III Regular Interest shall bear interest, such
interest to accrue on a notional amount (a "Component Notional Amount") equal to
the Uncertificated Principal Balance of such Class CP REMIC III Regular
Interest's or such Class S REMIC III Regular Interest's, as the case may be,
Corresponding REMIC II Regular Interest outstanding from time to time. The Class
CP Certificates shall be deemed to have an aggregate notional amount (a "Class
Notional Amount") that is, as of any date of determination, equal to the
aggregate of the then Component Notional Amounts of all the Class CP REMIC III
Regular Interests, and the Class S Certificates shall be deemed to have a Class
Notional Amount that is, as of any date of determination, equal to the aggregate
of the then Component Notional Amounts of all the Class S REMIC III Regular
Interests.
The per annum rate at which each Class CP REMIC III Regular Interest shall
accrue interest is herein referred to as its "Class CP Strip Rate". The Class CP
Strip Rate for each Class CP REMIC III Regular Interest shall be variable and,
with respect to any Interest Accrual Period, shall equal: (i) if such Interest
Accrual Period occurs during the period from the Cut-off Date through the end of
March 2005, the lesser of (A) the Maximum Class CP Strip Rate in respect of such
Class CP REMIC III Regular Interest for such Interest Accrual Period and (B) the
excess, if any, of (1) the REMIC II Remittance Rate for such Interest Accrual
Period in respect of such Class CP REMIC III Regular Interest's Corresponding
REMIC II Regular Interest, over (2) the Pass-Through Rate for such Interest
Accrual Period in respect of the Class of Sequential Pay Certificates with the
same Corresponding REMIC II Regular Interest; and (ii) if such Interest Accrual
Period occurs after the end of March 2005, 0% per annum. Set forth below are the
respective "Maximum Class CP Strip Rates" for the Class CP REMIC III Regular
Interests for each Interest Accrual Period that occurs during the period from
the Cut-off Date through the end of March 2005:
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Designation of Class CP Maximum Class CP
REMIC III Regular Interest Strip Rate
-------------------------- ----------
CP-A-1B2 1.04%
CP-A-2 0.86%
CP-A-3 0.75%
CP-B-1 0.39%
CP-B-2 0.12%
The per annum rate at which each Class S REMIC III Regular Interest shall
accrue interest is herein referred to as its "Class S Strip Rate". The Class S
Strip Rate for each Class S REMIC III Regular Interest shall be variable and,
with respect to each Interest Accrual Period, shall equal the excess, if any, of
(i) the REMIC II Remittance Rate for such Interest Accrual Period in respect of
such Class S REMIC III Regular Interest's Corresponding REMIC II Regular
Interest, over (ii) the Pass-Through Rate for such Interest Accrual Period in
respect of the Class of Sequential Pay Certificates with the same Corresponding
REMIC II Regular Interest, plus (in the case of each of REMIC III Regular
Interest S-A-1B2, REMIC III Regular Interest S-A-2, REMIC III Regular Interest
S-A-3, REMIC III Regular Interest S-B-1 and REMIC III Regular Interest S-B-2, if
such Interest Accrual Period occurs during the period from the Cut-off Date
through the end of March 2005) the Class CP Strip Rate for such Interest Accrual
Period in respect of the Class CP REMIC III Regular Interest with the same
Corresponding REMIC II Regular Interest.
The per annum rate at which each Class of Regular Interest Certificates
accrues (or is deemed to accrue) interest is herein referred to as its
"Pass-Through Rate". The Class CP Certificates will be deemed to have a
Pass-Through Rate that, with respect to each Interest Accrual Period, is equal
to the weighted average, expressed as a percentage and rounded to eight decimal
places, of the respective Class CP Strip Rates in effect for all the Class CP
REMIC III Regular Interests for such Interest Accrual Period, weighted on the
basis of the respective Component Notional Amounts of such Class CP REMIC III
Regular Interests outstanding immediately prior to the related Distribution
Date. The Class S Certificates will be deemed to have a Pass-Through Rate that,
with respect to each Interest Accrual Period, is equal to the weighted average,
expressed as a percentage and rounded to eight decimal places, of the respective
Class S Strip Rates in effect for all the Class S REMIC III Regular Interests
for such Interest Accrual Period, weighted on the basis of the respective
Component Notional Amounts of such Class S REMIC III Regular Interests
outstanding immediately prior to the related Distribution Date.
Solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each Class CP REMIC
III Regular Interest shall be the Distribution Date in April 2005, and the
"latest possible maturity date" for each Class S REMIC III Regular Interest
shall be the same as the "latest possible maturity date" for such Class S REMIC
III Regular Interest's Corresponding REMIC II Regular Interest.
(e) Each Class of Sequential Pay Certificates shall have an aggregate
principal balance (herein referred to as its "Class Principal Balance"). As
provided below, each such Class of Sequential Pay Certificates shall bear
interest, such interest to accrue on the Class Principal Balance of such Class
of Certificates outstanding from time to time.
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The following table sets forth for each Class of Sequential Pay
Certificates the initial Class Principal Balance thereof, the Pass-Through Rate
with respect thereto for the initial Interest Accrual Period and, solely for
purposes of satisfying Treasury regulation section 1.860G-1(a)(4)(iii), the
"latest possible maturity date" thereof (calculated based on the Maturity
Assumptions):
<TABLE>
<CAPTION>
Class Initial Class Initial Latest Possible
Designation Principal Balance Pass-Through Rate Maturity Date
- - ----------- ----------------- ----------------- ---------------
<S> <C> <C> <C>
Class A-1A $125,000,000 6.14% October 15, 2006
Class A-1B $466,300,000 6.41% February 15, 2008
Class A-2 $50,400,000 6.59% February 15, 2008
Class A-3 $50,300,000 6.70% February 15, 2008
Class B-1 $41,900,000 7.06% November 15, 2009
Class B-2 $14,700,000 7.33% January 15, 2010
Class B-3 $10,000,000 7.60% June 15, 2010
Class B-4 $27,100,000 7.60% January 15, 2013
Class B-5 $15,000,000 6.41% September 15, 2017
Class B-6 $15,000,000 6.41% November 15, 2017
Class B-7 $6,300,000 6.41% November 15, 2017
Class C $16,800,140 6.41% January 15, 2018
</TABLE>
The respective Pass-Through Rates applicable to the Class A-1A, Class A-1B,
Class A-2, Class A-3, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates
are subject to change and, in the case of each such Class of Certificates, for
each Interest Accrual Period subsequent to the initial Interest Accrual Period,
shall equal the lesser of (i) the per annum rate set forth in the table above
with respect to such Class of Certificates and (ii) the REMIC II Remittance Rate
for the subject Interest Accrual Period in respect of such Class of
Certificates' Corresponding REMIC II Regular Interest. The respective
Pass-Through Rates applicable to the Class B-5, Class B-6, Class B-7 and Class C
Certificates shall, in the case of each such Class of Certificates, remain fixed
at the per annum rate set forth in the table above with respect to such Class of
Certificates.
On each Distribution Date, the Class Principal Balance of each Class of
Sequential Pay Certificates shall be permanently reduced by any distributions of
principal made in respect of such Class of Certificates on such Distribution
Date pursuant to Section 4.01(a) and, further, by any Realized Losses and/or
Additional Trust Fund Expenses allocated to such Class of Certificates on such
Distribution Date pursuant to Section 4.04(a). Except as provided in the
preceding sentence, the Class Principal Balance of each Class of Sequential Pay
Certificates shall not otherwise be increased or reduced. Distributions in
reimbursement of the Holders of any such Class of Sequential Pay Certificates
for previously allocated Realized Losses and Additional Trust Fund Expenses
shall not constitute distributions of principal and shall not result in any
reduction of the Certificate Principal Balances of such Certificates or of the
related Class Principal Balance.
(f) Accrued Component Interest in respect of the Class CP REMIC III Regular
Interests and the Class S REMIC III Regular Interests shall commence accruing on
the Cut-off Date. With respect to each Class CP REMIC III Regular Interest, the
Accrued Component Interest shall accrue during each Interest Accrual Period at
the applicable Class CP Strip Rate on the Component Notional Amount of such
Class CP REMIC III Regular Interest outstanding immediately prior to the related
Distribution Date. With respect to each Class S REMIC III Regular Interest, the
Accrued Component Interest shall accrue during each Interest Accrual Period at
the applicable Class S Strip Rate on the Component Notional Amount of such
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Class S REMIC III Regular Interest outstanding immediately prior to the related
Distribution Date. The Accrued Component Interest in respect of each Class CP
REMIC III Regular Interest and each Class S REMIC III Regular Interest shall be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
Notwithstanding the foregoing, the portion of the Accrued Component Interest in
respect of any Class CP REMIC III Regular Interest or any Class S REMIC III
Regular Interest for any Interest Accrual Period that may be distributable to
Holders on a current basis with respect thereto pursuant to Section 4.01(a)
shall not exceed the Distributable Component Interest in respect of such Class
CP REMIC III Regular Interest or such Class S REMIC III Regular Interest, as the
case may be, for the related Distribution Date.
(g) Accrued Certificate Interest in respect of the Sequential Pay
Certificates shall commence accruing on the Cut-off Date. With respect to each
Class of Sequential Pay Certificates, the Accrued Certificate Interest shall
accrue during each Interest Accrual Period at the applicable Pass-Through Rate
on the Class Principal Balance of such Class of Certificates outstanding
immediately prior to the related Distribution Date. The Accrued Certificate
Interest in respect of each Class of Sequential Pay Certificates shall be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
The Accrued Certificate Interest in respect of the Class CP Certificates for any
Interest Accrual Period shall consist of the aggregate Accrued Component
Interest in respect of all the Class CP REMIC III Regular Interests for such
Interest Accrual Period, calculated in accordance with Section 2.14(f); and the
Accrued Certificate Interest in respect of the Class S Certificates for any
Interest Accrual Period shall consist of the aggregate Accrued Component
Interest in respect of all the Class S REMIC III Regular Interests for such
Interest Accrual Period, calculated in accordance with Section 2.14(f).
Notwithstanding the foregoing, the portion of the Accrued Component Interest in
respect of any Class of Regular Interest Certificates for any Interest Accrual
Period that may be distributable to Holders on a current basis with respect
thereto pursuant to Section 4.01(a) shall not exceed the Distributable
Certificate Interest in respect of such Class of Certificates for the related
Distribution Date.
(h) The Class R-III Certificates shall not have principal balances and
shall not bear interest.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
SECTION 3.01. Administration of the Mortgage Loans.
(a) Each of the Servicer and the Special Servicer shall service and
administer the Mortgage Loans that it is obligated to service and administer
pursuant to this Agreement, for the benefit of the Certificateholders (as a
collective whole), in accordance with any and all applicable laws and the terms
of this Agreement and the respective Mortgage Loans and, to the extent
consistent with the foregoing, in accordance with the Servicing Standard. The
Servicer or Special Servicer, as applicable in accordance with this Agreement,
shall service and administer each Cross-Collateralized Group as a single
Mortgage Loan as and when necessary and appropriate consistent with the
Servicing Standard. Without limiting the foregoing, and subject to Section 3.21,
(i) the Servicer shall service and administer all Mortgage Loans as to which no
Servicing Transfer Event has occurred and all Corrected Mortgage Loans, and (ii)
the Special Servicer shall service and administer (x) each Mortgage Loan (other
than a Corrected Mortgage Loan) as to which a Servicing Transfer Event has
occurred, and (y) each REO Property; provided, however, that the Servicer shall
continue to collect information and prepare all reports to the Trustee required
hereunder with respect to any Specially Serviced Mortgage Loans and REO
Properties (and the related REO Mortgage Loans) and, further, to render such
incidental services with respect to any Specially Serviced Mortgage Loans and
REO Properties as are specifically provided for herein. The Servicer shall not,
on behalf of the Trust, obtain title to a Mortgaged Property.
(b) Subject to Section 3.01(a) and Section 3.24, the Servicer and the
Special Servicer shall each have full power and authority, acting alone or
through Sub-Servicers, to do or cause to be done any and all things in
connection with such servicing and administration which it may deem necessary or
desirable. Without limiting the generality of the foregoing, each of the
Servicer and the Special Servicer, in its own name, with respect to each of the
Mortgage Loans it is obligated to service hereunder, is hereby authorized and
empowered by the Trustee to execute and deliver, on behalf of the
Certificateholders and the Trustee or any of them: (i) any and all financing
statements, continuation statements and other documents or instruments necessary
to maintain the lien created by any Mortgage or other security document in the
related Mortgage File on the related Mortgaged Property and other related
collateral; and (ii) any and all instruments of satisfaction or cancellation, or
of partial or full release or discharge, and all other comparable instruments.
In addition, without limiting the generality of the foregoing, each of the
Servicer and Special Servicer is authorized and empowered by the Trustee to
execute and deliver, in accordance with the Servicing Standard and subject to
Sections 3.08, 3.20 and 3.24, any and all modifications, waivers, amendments or
consents to or with respect to any documents contained in the related Mortgage
File. Subject to Section 3.10, the Trustee shall, at the written request of a
Servicing Officer of the Servicer or the Special Servicer, furnish, or cause to
be so furnished, to the Servicer or the Special Servicer, as appropriate, any
limited powers of attorney and other documents (each of which shall be prepared
by the Servicer or Special Servicer, as applicable) necessary or appropriate to
enable it to carry out its servicing and administrative duties hereunder;
provided, however, that the Trustee shall not be held liable for any misuse of
any such power of attorney by the Servicer or the Special Servicer.
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(c) The relationship of each of the Servicer and the Special Servicer to
the 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.
SECTION 3.02. Collection of Mortgage Loan Payments.
The Servicer and the Special Servicer shall each undertake reasonable
efforts to collect all payments called for under the terms and provisions of the
Mortgage Loans it is obligated to service hereunder and shall follow such
collection procedures as are consistent with the Servicing Standard; provided,
however, that neither the Servicer nor the Special Servicer shall, with respect
to any ARD Loan after its Anticipated Repayment Date, take any enforcement
action with respect to the payment of Additional Interest (other than the making
of requests for its collection), unless (i) the taking of an enforcement action
with respect to the payment of other amounts due under such Mortgage Loan is, in
the good faith and reasonable judgment of the Special Servicer, and without
regard to such Additional Interest, also necessary, appropriate and consistent
with the Servicing Standard or (ii) all other amounts due under such Mortgage
Loan have been paid, the payment of such Additional Interest has not been
forgiven in accordance with Section 3.20 and, in the good faith and reasonable
judgment of the Special Servicer, the Liquidation Proceeds expected to be
recovered in connection with such enforcement action will cover the anticipated
costs of such enforcement action and, if applicable, any associated Advance
Interest. Consistent with the foregoing, the Servicer and the Special Servicer
each may waive any Default Charges in connection with any specific delinquent
payment on a Mortgage Loan it is obligated to service hereunder.
Ninety (90) days prior to the maturity date of each Balloon Mortgage Loan,
the Servicer shall send a notice to the related Mortgagor of such maturity date
(with a copy to be sent to the Special Servicer) and shall request confirmation
that the Balloon Payment will be paid by such date.
SECTION 3.03. Collection of Taxes, Assessments and Similar Items; Servicing
Accounts; Reserve Accounts.
(a) The Servicer shall establish and maintain one or more accounts (the
"Servicing Accounts"), in which all Escrow Payments received by it with respect
to the Mortgage Loans shall be deposited and retained. Subject to any terms of
the related Mortgage Loan documents that specify the nature of the account in
which Escrow Payments shall be held, each Servicing Account shall be an Eligible
Account. Withdrawals of amounts so collected in respect of any Mortgage Loan
(and interest earned thereon) from a Servicing Account may be made only: (i) to
effect the payment of real estate taxes, assessments, insurance premiums, ground
rents (if applicable) and comparable items in respect of the related Mortgaged
Property; (ii) to reimburse the Servicer, the Special Servicer, the Trustee or
any Fiscal Agent, as applicable, for any unreimbursed Servicing Advances made
thereby to cover any of the items described in the immediately preceding clause
(i); (iii) to refund to the related Mortgagor any sums as may be determined to
be overages; (iv) to pay interest or other income, if required and as described
below, to the related Mortgagor on balances in the Servicing Account (or, if and
to the extent not payable to the related Mortgagor, and subject to Section 3.06,
to pay such interest or other income to the Servicer); or (v) to clear and
terminate the Servicing Account at the termination of this Agreement in
accordance with Section 9.01. The Servicer shall pay or cause to be paid to the
Mortgagors interest and other income, if any, earned on the investment of funds
in Servicing Accounts maintained thereby, if and to the extent required by law
or the terms of the related Mortgage Loan. If the Servicer shall deposit in a
Servicing Account any amount not required to be deposited therein, it may at any
time withdraw such amount from such Servicing Account, any provision herein to
the
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contrary notwithstanding. Promptly after any Escrow Payments are received by the
Special Servicer from any Mortgagor, and in any event within two Business Days
after any such receipt, the Special Servicer shall remit such Escrow Payments to
the Servicer for deposit in the applicable Servicing Account(s).
(b) Each of the Servicer and the Special Servicer shall, as to those
Mortgage Loans it is obligated to service hereunder, (i) maintain accurate
records with respect to the related Mortgaged Property reflecting the status of
real estate taxes, assessments and other similar items that are or may become a
lien thereon and the status of insurance premiums and any ground rents payable
in respect thereof and (ii) use reasonable efforts consistent with the Servicing
Standard to obtain, from time to time, all bills for the payment of such items
(including renewal premiums) and effect payment thereof prior to the applicable
penalty or termination date. For purposes of effecting any such payment, the
Servicer shall (at the direction of the Special Servicer in the case of a
Specially Serviced Mortgage Loan) apply Escrow Payments as allowed under the
terms of the related Mortgage Loan documents; provided, however, that if such
Mortgage Loan does not require the related Mortgagor to escrow for the payment
of real estate taxes, assessments, insurance premiums, ground rents (if
applicable) and similar items, each of the Servicer and the Special Servicer
shall, as to those Mortgage Loans it is obligated to service hereunder, enforce
the requirement of the related Mortgage that the Mortgagor make payments in
respect of such items at the time they first become due.
(c) In accordance with the Servicing Standard, the Servicer shall (at the
direction of the Special Servicer in the case of Specially Serviced Mortgage
Loans) advance with respect to each Mortgaged Property, all such funds as are
necessary for the purpose of effecting the timely payment of (i) real estate
taxes, assessments and other similar items, (ii) ground rents (if applicable),
and (iii) premiums on Insurance Policies, in each instance if and to the extent
Escrow Payments (if any) collected from the related Mortgagor are insufficient
to pay such item when due and the related Mortgagor has failed to pay such item
on a timely basis, and provided that the particular Advance would not, if made,
constitute a Nonrecoverable Servicing Advance. All such Advances shall be
reimbursable in the first instance from related collections from the Mortgagors
and further as provided in Section 3.05(a). No costs incurred by the Servicer in
effecting the payment of real estate taxes, assessments and, if applicable,
ground rents on or in respect of such Mortgaged Properties shall, for purposes
hereof, including calculating monthly distributions to Certificateholders, be
added to the respective unpaid principal balances or Stated Principal Balances
of the related Mortgage Loans, notwithstanding that the terms of such Mortgage
Loans so permit.
(d) The Servicer shall establish and maintain, as applicable, one or more
accounts (the "Reserve Accounts"), in which all Reserve Funds, if any, shall be
deposited and retained. As and to the extent consistent with the Servicing
Standard and the related Mortgage Loan documents, withdrawals of amounts so
deposited may be made to pay for, or to reimburse the related Mortgagor in
connection with, the costs associated with the related tenant improvements,
leasing commissions, repairs, replacements, capital improvements and/or
environmental testing and remediation at or with respect to the related
Mortgaged Property for which such Reserve Funds were intended. In addition, as
and to the extent consistent with the Servicing Standard and the related
Mortgage Loan documents, withdrawals of amounts so deposited may be made to
prepay the Mortgage Loan in the event certain leasing or other economic criteria
are not satisfied at the related Mortgaged Property, or to be released to the
related Mortgagor or otherwise applied for any other appropriate purpose in the
event that such criteria are satisfied. Subject to the terms of the related
Mortgage Loan documents, each Reserve Account shall be an Eligible Account.
Interest and other income, if any, earned on funds on deposit in any Reserve
Account shall, subject to Section 3.06, be for the benefit of and payable to the
Servicer, unless otherwise required to be paid to the related Mortgagor by law
or the terms of the related Mortgage Loan.
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(e) To the extent an operations and maintenance plan is required to be
established and executed pursuant to the terms of a Mortgage Loan, the Servicer
shall request from the Mortgagor written confirmation thereof within a
reasonable time after the later of the Closing Date and the date as of which
such plan is required to be established or completed. To the extent any action
or remediations are required to have been taken or completed pursuant to the
terms of the related Mortgage Loan documents, the Servicer shall request from
the Mortgagor written confirmation of such action and remediations within a
reasonable time after the later of the Closing Date and the date as of which
such action or remediations are required to have been taken or completed. To the
extent a Mortgagor shall fail to promptly respond to any inquiry described in
this Section 3.03(e), the Servicer shall determine whether the related Mortgagor
has failed to perform its obligations under the related Mortgage Loan. The
Servicer shall promptly notify the Trustee, the Special Servicer and the
Controlling Class Representative if the Servicer shall determine that any
Mortgagor has failed to perform its obligations under the related Mortgage Loan
in respect of environmental matters.
(f) Subject to applicable law and the terms of the related Mortgage Loan
documents, funds in the Servicing Accounts and the Reserve Accounts may be
invested only in Permitted Investments in accordance with the provisions of
Section 3.06.
SECTION 3.04. Collection Account and Distribution Account.
(a) The Servicer shall establish and maintain one or more segregated
accounts (collectively, the "Collection Account"), in which the funds described
below are to be deposited and held on behalf of the Trustee in trust for the
benefit of the Certificateholders. Each account that constitutes the Collection
Account shall be an Eligible Account. The Servicer shall deposit or cause to be
deposited in the Collection Account, upon receipt (in the case of payments by
Mortgagors or other collections on the Mortgage Loans) or as otherwise required
hereunder, the following payments and collections received or made by or on
behalf of the Servicer in respect of the Mortgage Pool subsequent to the Closing
Date (other than in respect of scheduled payments of principal and interest due
and payable on the Mortgage Loans on or before the Cut-off Date (or, in the case
of a Replacement Mortgage Loan, on or before the related date of substitution),
which payments shall be delivered promptly to the Seller or its designee, with
negotiable instruments endorsed as necessary and appropriate without recourse):
(i) all payments on account of principal of the Mortgage Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans,
including Default Interest and Additional Interest;
(iii) all Prepayment Premiums, Yield Maintenance Premiums and late
payment charges received in respect of the Mortgage Loans;
(iv) all Insurance Proceeds and Liquidation Proceeds received in
respect of the Mortgage Loans;
(v) any amounts required to be deposited by the Servicer pursuant to
Section 3.06 in connection with losses incurred with respect to Permitted
Investments of funds held in the Collection Account;
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(vi) any amounts required to be deposited by the Servicer or the
Special Servicer pursuant to Section 3.07(b) in connection with losses
resulting from a deductible clause in a blanket hazard policy;
(vii) any amounts required to be transferred from any REO Account
pursuant to Section 3.16(c); and
(viii) insofar as they do not constitute Escrow Payments, any amounts
paid by a Mortgagor specifically to cover items for which a Servicing
Advance has been made.
The foregoing requirements for deposit in the Collection Account shall be
exclusive. Without limiting the generality of the foregoing, actual payments
from Mortgagors in the nature of Escrow Payments, assumption fees, assumption
application fees, extension fees, modification fees, charges for beneficiary
statements or demands and amounts collected for checks returned for insufficient
funds, need not be deposited by the Servicer in the Collection Account. The
Servicer shall promptly deliver to the Special Servicer any of the foregoing
items received by it, if and to the extent that such items constitute Additional
Special Servicing Compensation. If the Servicer shall deposit in the Collection
Account any amount not required to be deposited therein, it may at any time
withdraw such amount from the Collection Account, any provision herein to the
contrary notwithstanding.
Upon receipt of any of the amounts described in clauses (i) through (iv)
and (viii) of the first paragraph of this Section 3.04(a) with respect to any
Mortgage Loan, the Special Servicer shall promptly, but in no event later than
one Business Day after receipt, remit such amounts to the Servicer for deposit
into the Collection Account in accordance with the second preceding paragraph,
unless the Special Servicer determines, consistent with the Servicing Standard,
that a particular item should not be deposited because of a restrictive
endorsement. With respect to any such amounts paid by check to the order of the
Special Servicer, the Special Servicer shall endorse such check to the order of
the Servicer (in its capacity as such for the Trust), without recourse,
representation or warranty, unless the Special Servicer determines, consistent
with the Servicing Standard, that a particular item cannot be so endorsed and
delivered because of a restrictive endorsement. Any such amounts received by the
Special Servicer with respect to an REO Property shall be deposited by the
Special Servicer into the REO Account and remitted to the Servicer for deposit
into the Collection Account pursuant to Section 3.16(c).
(b) The Trustee shall establish and maintain one or more segregated
accounts (collectively, the "Distribution Account"), to be held in trust for the
benefit of the Certificateholders. Each account that constitutes the
Distribution Account shall be an Eligible Account. On each Servicer Remittance
Date, the Servicer shall deliver to the Trustee, for deposit in the Distribution
Account, an aggregate amount of immediately available funds equal to the
Servicer Remittance Amount for such Servicer Remittance Date. In addition, the
Servicer shall, as and when required hereunder, deliver to the Trustee for
deposit in the Distribution Account any P&I Advances and Compensating Interest
Payments required to be made by the Servicer hereunder. Furthermore, any amounts
paid by any party hereto to indemnify the Trust Fund pursuant to any provision
hereof shall be delivered to the Trustee for deposit in the Distribution
Account. The Trustee shall, upon receipt, deposit in the Distribution Account
any and all amounts received or, pursuant to Section 4.03, advanced by the
Trustee or any Fiscal Agent that are required by the terms of this Agreement to
be deposited therein.
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(c) Funds in the Collection Account may be invested in Permitted
Investments in accordance with the provisions of Section 3.06. Funds in the
Distribution Account shall remain uninvested. The Servicer shall give notice to
the other parties hereto of the location of the Collection Account as of the
Closing Date and of the new location of the Collection Account prior to any
change thereof. The Distribution Account shall be established at the Corporate
Trust Office of the Trustee as of the Closing Date, and the Trustee shall give
notice to the other parties hereto of the new location of the Distribution
Account prior to any change thereof.
SECTION 3.05. Permitted Withdrawals From the Collection Account and the
Distribution Account.
(a) The Servicer may, from time to time, make withdrawals from the
Collection Account for any of the following purposes (the order set forth below
not constituting an order of priority for such withdrawals):
(i) to remit to the Trustee for deposit in the Distribution Account
the Servicer Remittance Amount for each Servicer Remittance Date and any
amounts that may be applied to make P&I Advances pursuant to Section
4.03(a);
(ii) to reimburse itself, the Trustee or any Fiscal Agent, as
applicable, for unreimbursed P&I Advances made thereby (in each case, with
its own funds), the Servicer's, the Trustee's and any Fiscal Agent's, as
the case may be, respective rights to reimbursement pursuant to this clause
(ii) with respect to any P&I Advance (other than Nonrecoverable P&I
Advances, which are reimbursable pursuant to clause (vii) below) being
limited to amounts that represent Late Collections of interest and
principal received in respect of the particular Mortgage Loan or REO
Mortgage Loan as to which such P&I Advance was made (net of related
Servicing Fees and Workout Fees);
(iii) to pay to itself earned and unpaid Servicing Fees in respect of
each Mortgage Loan and REO Mortgage Loan, the Servicer's right to payment
pursuant to this clause (iii) with respect to any Mortgage Loan or REO
Mortgage Loan being limited to amounts received on or in respect of such
Mortgage Loan (whether in the form of payments, Liquidation Proceeds or
Insurance Proceeds) or such REO Mortgage Loan (whether in the form of REO
Revenues, Liquidation Proceeds or Insurance Proceeds) that are allocable as
interest thereon;
(iv) to pay to the Special Servicer, out of general collections on the
Mortgage Loans and any REO Properties, earned and unpaid Special Servicing
Fees in respect of each Specially Serviced Mortgage Loan and REO Mortgage
Loan;
(v) to pay the Special Servicer (or, if applicable, any predecessor
thereto) earned and unpaid Workout Fees and Liquidation Fees to which it is
entitled pursuant to, and from the sources contemplated by, the second and
third paragraphs of Section 3.11(c);
(vi) to reimburse itself, the Special Servicer, the Trustee or any
Fiscal Agent, as applicable, for any unreimbursed Servicing Advances made
thereby (in each case, with its own funds), the Servicer's, the Special
Servicer's, the Trustee's and any Fiscal Agent's, as the case
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may be, respective rights to reimbursement pursuant to this clause (vi)
with respect to any Servicing Advance (other than Nonrecoverable Servicing
Advances, which are reimbursable pursuant to clause (vii) below) being
limited to (A) payments made by the related Mortgagor that are allocable to
cover the item in respect of which such Servicing Advance was made, and (B)
Liquidation Proceeds, Insurance Proceeds and, if applicable, REO Revenues
received in respect of the particular Mortgage Loan or REO Property as to
which such Servicing Advance was made;
(vii) to reimburse itself, the Special Servicer, the Trustee or any
Fiscal Agent, as applicable, out of general collections on the Mortgage
Loans and any REO Properties, for any unreimbursed Advances made thereby
that have been determined to be Nonrecoverable Advances;
(viii) to pay itself, the Special Servicer, the Trustee or any Fiscal
Agent, as applicable, any Advance Interest due and owing thereto, the
Servicer's, the Special Servicer's, the Trustee's or any Fiscal Agent's, as
the case may be, respective rights to payment pursuant to this clause
(viii) being limited to Default Charges collected in respect of the
Mortgage Loan or REO Mortgage Loan as to which the related Advances were
made thereby;
(ix) at or following such time as it reimburses itself, the Special
Servicer, the Trustee or any Fiscal Agent, as applicable, for any
unreimbursed Advance pursuant to clause (ii), (vi) or (vii) above or
pursuant to Section 3.03(c), and insofar as payment has not already been
made pursuant to clause (viii) above, to pay itself, the Special Servicer,
the Trustee or such Fiscal Agent, as the case may be, out of general
collections on the Mortgage Loans and any REO Properties, any related
Advance Interest accrued and payable on such Advance;
(x) to reimburse the Trustee or any Fiscal Agent, as applicable, out
of general collections on the Mortgage Loans and any REO Properties, for
any advance made thereby pursuant to Section 4.03(a) to cover any portion
of a Servicer Remittance Amount not remitted by the Servicer to the Trustee
on or before 5:00 p.m., New York City time, on the related Servicer
Remittance Date, together with any interest accrued and payable on such
advance at the Reimbursement Rate;
(xi) to pay itself any items of Additional Servicing Compensation on
deposit in the Collection Account from time to time;
(xii) to pay to the Special Servicer any items of Additional Special
Servicing Compensation on deposit in the Collection Account from time to
time;
(xiii) to pay any unpaid Liquidation Expenses incurred with respect to
any Mortgage Loan or REO Property, such payments to be made solely from
Liquidation Proceeds, Insurance Proceeds and, if applicable, REO Revenues
received in respect of such Mortgage Loan or REO Property, as the case may
be;
(xiv) to pay, in accordance with Section 3.11(i), certain servicing
expenses that would, if advanced, constitute Nonrecoverable Servicing
Advances;
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(xv) to pay itself, the Special Servicer, the REMIC Administrator, the
Depositor, the Trustee, any Fiscal Agent, or any of their respective
directors, officers, employees and agents, as the case may be, out of
general collections on the Mortgage Loans and any REO Properties, any
amounts payable to any such Person pursuant to Section 6.03, Section
7.01(b), Section 8.05 and/or Section 8.13, as applicable;
(xvi) to pay, out of general collections on the Mortgage Loans and any
REO Properties, for (A) the cost of the Opinion of Counsel contemplated by
Section 11.02(a), (B) the cost of recording this Agreement in accordance
with Section 11.02(a), (C) any expense (including the reasonable fees of
tax accountants and attorneys) incurred by the REMIC Administrator pursuant
to Section 3.17(a)(iii) in connection with providing advice to the Special
Servicer, and (D) any expense incurred by the Trustee pursuant to Section
3.23(b) in connection with obtaining information from the Depository or
Depository Participants regarding any Book-Entry Certificate;
(xvii) to pay itself, the Special Servicer, the Seller, a Third Party
Originator, the Majority Certificateholder of the Controlling Class or any
other particular Person, as the case may be, with respect to each Mortgage
Loan, if any, previously purchased by such Person pursuant to this
Agreement, all amounts received thereon subsequent to the date of purchase;
and
(xviii) to clear and terminate the Collection Account at the
termination of this Agreement pursuant to Section 9.01.
If amounts on deposit in the Collection Account at any particular time
(after withdrawing any portion of such amounts deposited in the Collection
Account in error) are insufficient to satisfy all payments, reimbursements and
remittances to be made therefrom as set forth in clauses (ii) through (xvii)
above, then the corresponding withdrawals from the Collection Account shall be
made in the following priority and subject to the following rules: (y) if the
payment, reimbursement or remittance is to be made from a specific source of
funds, then such payment, reimbursement or remittance shall be made from that
specific source of funds on a pro rata basis with any and all other payments,
reimbursements and remittances to be made from such specific source of funds;
and (z) if the payment, reimbursement or remittance can be made from any funds
on deposit in the Collection Account, then (following any withdrawals made from
the Collection Account in accordance with the immediately preceding clause (y)
above) such payment, reimbursement or remittance shall be made from the general
funds remaining on a pro rata basis with any and all other payments,
reimbursements or remittances to be made from such general funds; provided that
any reimbursements of Advances in respect of any particular Mortgage Loan or REO
Property out of the Collection Account pursuant to any of clauses (ii), (vi) and
(vii) above, and any payments of interest thereon out of the Collection Account
pursuant to either of clauses (viii) and (ix) above, shall be made (to the
extent of their respective entitlements to such reimbursements and/or payments):
first, to any Fiscal Agent; second, to the Trustee; and third, pro rata, to the
Servicer and Special Servicer..
The Servicer shall keep and maintain separate accounting records, on a
loan-by-loan and property-by-property basis when appropriate, in connection with
any withdrawal from the Collection Account pursuant to any of clauses (ii)
through (xvii) above.
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The Servicer shall pay to the Special Servicer (or to third party
contractors at the direction of the Special Servicer) from the Collection
Account amounts permitted to be paid to it (or to such third party contractors)
therefrom promptly upon receipt of a certificate of a Servicing Officer of the
Special Servicer describing the item and amount to which the Special Servicer
(or any such third party contractor) is entitled. The Servicer may rely
conclusively on any such certificate and shall have no duty to re-calculate the
amounts stated therein. The Special Servicer shall keep and maintain separate
accounting for each Specially Serviced Mortgage Loan and REO Property, on a
loan-by-loan and property-by-property basis, for the purpose of justifying any
request for withdrawal from the Collection Account.
(b) The Trustee shall, from time to time, make withdrawals from the
Distribution Account for each of the following purposes (the order set forth
below not constituting an order of priority for such withdrawals):
(i) to make distributions to Certificateholders on each Distribution
Date pursuant to Section 4.01;
(ii) to pay itself (whether in its capacity as Trustee or, for so long
as it acts as such, REMIC Administrator) or any of its directors, officers,
employees and agents, as the case may be, any amounts payable or
reimbursable to any such Person pursuant to Section 8.05;
(iii) to pay any Fiscal Agent or any of its directors, officers,
employees and agents, as the case may be, any amounts payable or
reimbursable to any such Person pursuant to Sections 8.05 and 8.13(a);
(iv) to pay for the cost of the Opinions of Counsel sought by the
Trustee as contemplated by Section 11.01(a) or 11.01(c) in connection with
any amendment to this Agreement requested by the Trustee which amendment is
in furtherance of the rights and interests of Certificateholders;
(v) to pay any and all federal, state and local taxes imposed on any
REMIC Pool or on the assets or transactions of any REMIC Pool, together
with all incidental costs and expenses, and any and all expenses relating
to tax audits, if and to the extent that either (A) none of the parties
hereto are liable therefor pursuant to Section 10.01(b) and/or Section
10.01(f) or (B) any such Person that may be so liable has failed to timely
make the required payment; and
(vi) to clear and terminate the Distribution Account at the
termination of this Agreement pursuant to Section 9.01.
(c) The Trustee, any Fiscal Agent, the Depositor, the Servicer and the
Special Servicer shall in all cases have a right prior to the Certificateholders
to any particular funds on deposit in the Collection Account and the
Distribution Account from time to time for the reimbursement or payment of
compensation, Advances (with interest thereon at the Reimbursement Rate) and
their respective expenses hereunder (or, in the case of such expenses, to have
such funds paid directly to third party contractors from any invoices approved
by the Trustee, any Fiscal Agent, the Depositor, the Servicer or the Special
Servicer, as applicable), but only if and to the extent such compensation,
Advances (with interest) and expenses are to be reimbursed
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or paid from such particular funds on deposit in the Collection Account or the
Distribution Account pursuant to the express terms of this Agreement.
SECTION 3.06. Investment of Funds in the Collection Account, Servicing
Accounts, Reserve Accounts and the REO Account.
(a) The Servicer may direct (pursuant to a standing order or otherwise) any
depository institution maintaining the Collection Account or any Servicing
Account or Reserve Account, and the Special Servicer may direct (pursuant to a
standing order or otherwise) any depository institution maintaining the REO
Account, to invest, or if it is such depository institution, may itself invest,
the funds held therein (each such account, for purposes of this Section 3.06, an
"Investment Account") in (but only in) one or more Permitted Investments bearing
interest or sold at a discount, and maturing, unless payable on demand, no later
than the Business Day immediately preceding the next succeeding date on which
such funds are required to be withdrawn from such account pursuant to this
Agreement or the related Mortgage Loan documents, as applicable; provided that
any such investment of funds in any Servicing Account or Reserve Account shall
be subject to applicable law and the terms of the related Mortgage Loan
documents. All such Permitted Investments shall be held to maturity, unless
payable on demand. Any investment of funds in an Investment Account shall be
made in the name of the Trustee (in its capacity as such). The Servicer (with
respect to Permitted Investments of amounts in the Collection Account, the
Servicing Accounts and the Reserve Accounts) and the Special Servicer (with
respect to Permitted Investments of amounts in the REO Account), on behalf of
the Trustee, shall (and the Trustee hereby designates the Servicer and the
Special Servicer, as applicable, as the Person that shall) maintain continuous
possession of any Permitted Investment that is either (i) a "certificated
security", as such term is defined in the UCC, or (ii) other property in which a
secured party may perfect its security interest by possession under the UCC or
any other applicable law. Possession of any such Permitted Investment by the
Servicer or the Special Servicer shall constitute possession by a person
designated by the Trustee for purposes of Section 8-313 of the UCC and
possession by the Trustee, as secured party, for purposes of Section 9-305 of
the UCC and any other applicable law. If amounts on deposit in an Investment
Account are at any time invested in a Permitted Investment payable on demand,
the Servicer (in the case of the Collection Account or any Servicing Account or
Reserve Account) or the Special Servicer (in the case of the REO Account) shall:
(x) consistent with any notice required to be given thereunder, demand
that payment thereon be made on the last day such Permitted Investment may
otherwise mature hereunder in an amount at least equal to the lesser of (1)
all amounts then payable thereunder and (2) the amount required to be
withdrawn on such date; and
(y) demand payment of all amounts due thereunder promptly upon
determination by the Servicer or the Special Servicer, as the case may be,
that such Permitted Investment would not constitute a Permitted Investment
in respect of funds thereafter on deposit in the Investment Account.
(b) Whether or not the Servicer directs the investment of funds in the
Collection Account, interest and investment income realized on funds deposited
therein, to the extent of the Net Investment Earnings, if any, for such
Investment Account for each Collection Period, shall be for the sole and
exclusive benefit of the Servicer and shall be subject to its withdrawal in
accordance with Section 3.05(a). Whether or not the Servicer directs the
investment of funds in any Servicing Account or Reserve Account, interest and
investment income realized on funds deposited therein, to the extent of the Net
Investment Earnings, if any,
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for such Investment Account for each Collection Period, shall be for the sole
and exclusive benefit of the Servicer and shall be subject to withdrawal from
time to time in accordance with Section 3.03, but only if and to the extent not
required to be paid to the related Mortgagor pursuant to applicable law or the
terms of the related Mortgage Loan. Whether or not the Special Servicer directs
the investment of funds in the REO Account, interest and investment income
realized on funds deposited therein, to the extent of the Net Investment
Earnings, if any, for such Investment Account for each Collection Period, shall
be for the sole and exclusive benefit of the Special Servicer and shall be
subject to its withdrawal in accordance with Section 3.16(b). If any loss shall
be incurred in respect of any Permitted Investment on deposit in any Investment
Account (other than a loss of what would otherwise have constituted investment
earnings), the Servicer (in the case of the Collection Account or any Servicing
Account or Reserve Account) and the Special Servicer (in the case of the REO
Account) shall promptly deposit therein from its own funds, without right of
reimbursement, no later than the end of the Collection Period during which such
loss was incurred, the amount of the Net Investment Loss, if any, for such
Collection Period (or, in the case of a Servicing Account or Reserve Account,
the entire amount of such loss).
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of any payment due (or in any other performance
required) under any Permitted Investment, and if the Servicer (if such default
is in respect of a Permitted Investment of funds in the Certificate Account or
in any Reserve Account or Servicing Account) or the Special Servicer (if such
default is in respect of a Permitted Investment of funds in the REO Account), as
applicable, is in default of its obligations under Section 3.06(b), the Trustee
may, and, subject to Section 8.02, upon the request of Holders of Certificates
entitled to not less than 25% of the Voting Rights allocated to any Class of
Regular Interest Certificates, the Trustee shall, take such action as may be
appropriate to enforce such payment or performance, including the institution
and prosecution of appropriate legal proceedings. Any costs incurred by the
Trustee in taking any such action shall be reimbursed to it by the Servicer if
the default is in respect of a Permitted Investment of funds in the Collection
Account or in any Reserve Account or Servicing Account or by the Special
Servicer if the default is in respect of a Permitted Investment of funds in the
REO Account. This provision is in no way intended to limit any actions that the
Servicer or Special Servicer may take in this regard at its own expense.
(d) Amounts on deposit in the Distribution Account shall remain uninvested.
(e) Notwithstanding the investment of funds held in any Investment Account,
for purposes of the calculations hereunder, including the calculation of the
Available Distribution Amount and the Servicer Remittance Amount, the amounts so
invested shall be deemed to remain on deposit in such Investment Account.
SECTION 3.07. Maintenance of Insurance Policies; Errors and Omissions and
Fidelity Coverage.
(a) The Servicer (with respect to Mortgage Loans other than Specially
Serviced Mortgaged Loans) and the Special Servicer (with respect to Specially
Serviced Mortgage Loans) shall cause to be maintained for each Mortgaged
Property all insurance coverage as is required under the related Mortgage;
provided that if, and to the extent that any such Mortgage permits the holder
thereof any discretion (by way of consent, approval or otherwise) as to the
insurance coverage that the related Mortgagor is required to maintain, the
Servicer or the Special Servicer, as the case may be, shall exercise such
discretion in a manner consistent with the Servicing Standard, with a view
towards requiring insurance comparable to
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that required under other Mortgage Loans with express provisions governing such
matters; and provided, further, that, if and to the extent that a Mortgage so
permits, the related Mortgagor shall be required to obtain the required
insurance coverage from Qualified Insurers that, in each case, have a
claims-paying rating (or, in the case of Moody's, an insurance financial
strength rating) no lower than two rating categories below the highest rated
Certificates outstanding, and in any event no lower than "BBB" from S&P, "Baa2"
from Moody's (if then rated by Moody's), "A" from Fitch (if then rated by Fitch)
and, if not then rated by S&P and at least one other Rating Agency, "A:IX" from
A.M. Best. Subject to Section 3.17(b), the Special Servicer shall also cause to
be maintained for each REO Property no less insurance coverage than was
previously required of the Mortgagor under the related Mortgage and, at a
minimum, (i) hazard insurance with a replacement cost rider, (ii) business
interruption or rental loss insurance for at least 12 months, and (iii)
commercial general liability insurance, in each case, in an amount customary for
the type and geographic location of such REO Property and consistent with the
Servicing Standard; provided that all such insurance shall be obtained from
Qualified Insurers that, in each case, shall have a claims-paying rating (or, in
the case of Moody's, an insurance financial strength rating) no lower than two
rating categories below the highest rated Certificates outstanding, and in any
event no lower than "BBB" from S&P, "Baa2" from Moody's (if then rated by
Moody's), "A" from Fitch (if then rated by Fitch) and, if not then rated by S&P
and at least one other Rating Agency, "A:IX" from A.M. Best. All such insurance
policies shall contain (if they insure against loss to property) a "standard"
mortgagee clause, with loss payable to the Servicer on behalf of the Trustee (in
the case of insurance maintained in respect of Mortgage Loans), or shall name
the Trustee as the insured, with loss payable to the Special Servicer on behalf
of the Trustee (in the case of insurance maintained in respect of REO
Properties), and shall be issued by an insurer authorized under applicable law
to issue such insurance. Any amounts collected by the Servicer or the Special
Servicer under any such policies (other than amounts to be applied to the
restoration or repair of the related Mortgaged Property or REO Property or
amounts to be released to the related Mortgagor, in each case in accordance with
the Servicing Standard) shall be deposited in the Collection Account, subject to
withdrawal pursuant to Section 3.05(a), in the case of amounts received in
respect of a Mortgage Loan, or in the REO Account, subject to withdrawal
pursuant to Section 3.16(c), in the case of amounts received in respect of an
REO Property. Any cost incurred by the Servicer or the Special Servicer in
maintaining any such insurance shall not, for purposes hereof, including
calculating monthly distributions to Certificateholders, be added to unpaid
principal balance or Stated Principal Balance of the related Mortgage Loan,
notwithstanding that the terms of such Mortgage Loan so permit.
(b) If the Servicer or the Special Servicer shall obtain and maintain, or
cause to be obtained and maintained, a blanket policy insuring against hazard
losses on all of the Mortgage Loans and/or REO Properties that it is required to
service and administer, then, to the extent such policy (i) is obtained from a
Qualified Insurer having a claims-paying rating (or, in the case of Moody's, an
insurance financial strength rating) no lower than "A" from S&P, "A2" from
Moody's (if then rated by Moody's), "A" from Fitch (if then rated by Fitch) and,
if not then rated by S&P and at least one other Rating Agency, "A:IX" from A.M.
Best, and (ii) provides protection equivalent to the individual policies
otherwise required, the Servicer or the Special Servicer, as the case may be,
shall conclusively be deemed to have satisfied its obligation to cause hazard
insurance to be maintained on the related Mortgaged Properties and/or REO
Properties. Such policy may contain a deductible clause (not in excess of a
customary amount), in which case the Servicer or the Special Servicer, as
appropriate, shall, if there shall not have been maintained on the related
Mortgaged Property or REO Property a hazard insurance policy complying with the
requirements of Section 3.07(a), and there shall have been one or more losses
that would have been covered by such an individual policy, promptly deposit into
the Collection Account from its own funds the amount not otherwise payable under
the blanket policy in connection with such loss or losses because of such
deductible clause. The Servicer or
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the Special Servicer, as appropriate, shall prepare and present, on behalf of
itself, the Trustee and Certificateholders, claims under any such blanket policy
in a timely fashion in accordance with the terms of such policy, to the extent
that any such deductible exceeds the deductible limitation that pertained to the
related Mortgage Loan (or, in the absence of any such deductible limitation, the
deductible limitation for an individual policy which is consistent with the
Servicing Standard).
(c) Each of the Servicer and the Special Servicer shall at all times during
the term of this Agreement (or, in the case of the Special Servicer, at all
times during the term of this Agreement during which Specially Serviced Mortgage
Loans or REO Properties exist as part of the Trust Fund) keep in force with a
Qualified Insurer having a claims-paying rating (or, in the case of Moody's, an
insurance financial strength rating) no lower than two rating categories below
the highest rated Certificates outstanding, and in any event no lower than "BBB"
from S&P, "Baa2" from Moody's (if then rated by Moody's), "A" from Fitch (if
then rated by Fitch) and, if not then rated by S&P and at least one other Rating
Agency, "A:IX" from A.M. Best, a fidelity bond in such form and amount as would
permit it to be a qualified FNMA seller-servicer of multifamily mortgage loans
(or in such other form and amount as would not result in an Adverse Rating Event
with respect to any Class of Rated Certificates (as confirmed in writing to the
Trustee by each Rating Agency)). Each of the Servicer and the Special Servicer
shall be deemed to have complied with the foregoing provision if an Affiliate
thereof has such fidelity bond coverage and, by the terms of such fidelity bond,
the coverage afforded thereunder extends to the Servicer or the Special
Servicer, as the case may be. Such fidelity bond shall provide that it may not
be cancelled without ten days' prior written notice to the Trustee.
Each of the Servicer and the Special Servicer shall at all times during the
term of this Agreement (or, in the case of the Special Servicer, at all times
during the term of this Agreement during which Specially Serviced Mortgage Loans
and/or REO Properties exist as part of the Trust Fund) also keep in force with a
Qualified Insurer having a claims-paying rating (or, in the case of Moody's, an
insurance financial strength rating) no lower than two rating categories below
the highest rated Certificates outstanding, and in any event no lower than "BBB"
from S&P, "Baa2" from Moody's (if then rated by Moody's), "A" from Fitch (if
then rated by Fitch) and, if not then rated by S&P and at least one other Rating
Agency, "A:IX" from A.M. Best, a policy or policies of insurance covering loss
occasioned by the errors and omissions of its officers, employees and agents in
connection with its servicing obligations hereunder, which policy or policies
shall be in such form and amount as would permit it to be a qualified FNMA
seller-servicer of multifamily mortgage loans (or in such other form and amount
as would not result in an Adverse Rating Event with respect to any Class of
Rated Certificates (as confirmed in writing to the Trustee by each Rating
Agency)). Each of the Servicer and the Special Servicer shall be deemed to have
complied with the foregoing provisions if an Affiliate thereof has such
insurance and, by the terms of such policy or policies, the coverage afforded
thereunder extends to the Servicer or the Special Servicer, as the case may be.
Any such errors and omissions policy shall provide that it may not be cancelled
without ten days' prior written notice to the Trustee.
SECTION 3.08. Enforcement of Alienation Clauses.
The Servicer (with respect to Mortgage Loans other than Specially Serviced
Mortgage Loans) and the Special Servicer (with respect to Specially Serviced
Mortgage Loans), on behalf of the Trustee as the mortgagee of record, shall
evaluate any right to transfer and shall enforce the restrictions contained in
any Mortgage on transfers or further encumbrances of the related Mortgaged
Property and on transfers of interests in the related Mortgagor, unless the
Servicer or the Special Servicer, as appropriate, has determined, in its
reasonable, good faith judgment, that waiver of such restrictions would be in
accordance with the
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Servicing Standard; provided that neither the Servicer nor the Special Servicer
shall waive any right it has, or grant any consent it is otherwise entitled to
withhold, under any related "due-on-encumbrance" clause (or, if it involves any
Mortgage Loan or Cross-Collateralized Group representing 5% or more of the
Initial Pool Balance, under any related "due-on-sale" clause) until it has
received written confirmation from each Rating Agency that such action would not
result in an Adverse Rating Event with respect to any Class of Rated
Certificates; and provided, further, that the Servicer shall not waive any right
it has, or grant any consent it is otherwise entitled to withhold, under any
related "due-on-encumbrance" or "due-on-sale" clause without the consent of the
Special Servicer (it being understood and agreed that (i) the Special Servicer
shall not unreasonably withhold any such consent, (ii) the Special Servicer
shall decide whether to withhold or grant such consent in accordance with the
Servicing Standard and (iii) if any such consent has not been expressly denied
within 10 Business Days of the Special Servicer's receipt from the Servicer of
all information reasonably requested thereby in order to make an informed
decision, such consent shall be deemed to have been granted). The Servicer and
the Special Servicer shall each provide the other with all information as each
may reasonably request in order to make any such determination regarding the
waiver or enforcement of the Trust's rights under any "due-on-sale" or
"due-on-encumbrance" clause with respect to the Mortgage Loan; and, in
connection with its seeking the consent of the Special Servicer to the waiver of
the Trust's rights under any "due-on-sale" or "due-on-encumbrance" clause with
respect to a Mortgage Loan that is not a Specially Serviced Mortgage Loan, the
Servicer shall promptly provide the Special Servicer with all information the
Special Servicer may reasonably request in order to decide whether to grant or
withhold such consent. After having made any determination to waive the Trust's
rights under a "due-on-sale" or "due-on encumbrance" clause, the Servicer or the
Special Servicer, as appropriate, shall deliver to the Trustee and such other
party an Officer's Certificate setting forth the basis for such determination.
Notwithstanding the foregoing, neither the Servicer nor the Special Servicer
shall (to the extent that it is within the control thereof to prohibit such
event) consent to the transfer of any Mortgaged Property which secures a
Cross-Collateralized Group unless all of the Mortgaged Properties securing such
Cross-Collateralized Group are transferred simultaneously by the respective
Mortgagor.
SECTION 3.09. Realization Upon Defaulted Mortgage Loans.
(a) The Special Servicer shall, subject to Sections 3.09(b), 3.09(c),
3.09(d) and 3.24, exercise reasonable efforts, consistent with the Servicing
Standard, to foreclose upon or otherwise comparably convert the ownership of
properties and other collateral securing such of the Mortgage Loans as come into
and continue in default and as to which no satisfactory arrangements can be made
for collection of delinquent payments, including pursuant to Section 3.20;
provided that neither the Servicer nor the Special Servicer shall, with respect
to any ARD Loan after its Anticipated Repayment Date, take any enforcement
action with respect to the payment of Additional Interest (other than the making
of requests for its collection) unless (i) the taking of an enforcement action
with respect to the payment of other amounts due under such Mortgage Loan is, in
the good faith and reasonable judgment of the Special Servicer, and without
regard to such Additional Interest, also necessary, appropriate and consistent
with the Servicing Standard or (ii) all other amounts due under such Mortgage
Loan have been paid, the payment of such Additional Interest has not been
forgiven in accordance with Section 3.20 and, in the good faith and reasonable
judgment of the Special Servicer, the Liquidation Proceeds expected to be
recovered in connection with such enforcement action will cover the anticipated
costs of such enforcement action and, if applicable, any associated Advance
Interest. All costs and expenses incurred by the Special Servicer in any such
proceedings shall, at its direction, be advanced by the Servicer. In connection
with the foregoing, in the event of a default under any Mortgage Loan or
Cross-Collateralized Group that is secured by real properties located in
multiple states, and such states include California or another state with a
statute, rule or regulation comparable to California's
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"one action rule", then the Special Servicer shall consult Independent counsel
regarding the order and manner in which the Special Servicer should foreclose
upon or comparably proceed against such properties. Nothing contained in this
Section 3.09 shall be construed so as to require the Special Servicer, on behalf
of the Trust, to make a bid on any Mortgaged Property at a foreclosure sale or
similar proceeding that is in excess of the fair market value of such property,
as determined by the Special Servicer taking into account the factors described
in Section 3.18(e) and the results of any appraisal obtained pursuant to the
following sentence or otherwise, all such bids to be made in a manner consistent
with the Servicing Standard. If and when the Special Servicer deems it necessary
in accordance with the Servicing Standard for purposes of establishing the fair
market value of any Mortgaged Property securing a defaulted Mortgage Loan,
whether for purposes of bidding at foreclosure or otherwise, the Special
Servicer is authorized to have an Appraisal completed with respect to such
property (the cost of which appraisal shall be covered by, and be reimbursable
as, a Servicing Advance).
(b) Notwithstanding any other provision of this Agreement, no Mortgaged
Property shall be acquired by the Special Servicer on behalf of the Trust under
such circumstances, in such manner or pursuant to such terms as would (i) cause
such Mortgaged Property to fail to qualify as "foreclosure property" within the
meaning of Section 860G(a)(8) of the Code (unless the portion of such REO
Property that is not treated as "foreclosure property" and that is held by REMIC
I at any given time constitutes not more than a de minimis amount of the assets
of REMIC I within the meaning of Treasury regulation Section 1.860D-1(b)(3)(i)
and (ii)), or (ii) except as permitted by Section 3.17(a), subject the Trust to
the imposition of any federal income taxes under the Code. In addition, the
Special Servicer shall not acquire any personal property on behalf of the Trust
pursuant to this Section 3.09 unless either:
(i) such personal property is incident to real property (within the
meaning of Section 856(e)(1) of the Code) so acquired by the Special
Servicer; or
(ii) the Special Servicer shall have obtained an Opinion of Counsel
(the cost of which shall be covered by, and reimbursable as, a Servicing
Advance) to the effect that the holding of such personal property as part
of the Trust Fund will not result in an Adverse REMIC Event with respect to
any REMIC Pool.
(c) Notwithstanding the foregoing provisions of this Section 3.09, neither
the Servicer nor the Special Servicer shall, on behalf of the Trust, obtain
title to a Mortgaged Property by foreclosure, deed in lieu of foreclosure or
otherwise, or take any other action with respect to any Mortgaged Property, if,
as a result of any such action, the Trustee, on behalf of the
Certificateholders, could, in the reasonable, good faith judgment of the Special
Servicer, exercised in accordance with the Servicing Standard, be considered to
hold title to, to be a "mortgagee-in-possession" of, or to be an "owner" or
"operator" of such Mortgaged Property within the meaning of CERCLA or any
comparable law, unless:
(i) the Special Servicer has previously determined in accordance with
the Servicing Standard, based on a Phase I Environmental Assessment (and
any additional environmental testing that the Special Servicer deems
necessary and prudent) of such Mortgaged Property conducted by an
Independent Person who regularly conducts Phase I Environmental Assessments
and performed during the twelve-month period preceding any such acquisition
of title or other action, that the Mortgaged Property is in compliance with
applicable environmental laws and regulations and there are no
circumstances or conditions present at the Mortgaged Property relating to
the use, management or disposal of Hazardous
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Materials for which investigation, testing, monitoring, containment,
clean-up or remediation could be required under any applicable
environmental laws and regulations; or
(ii) in the event that the determination described in clause (c)(i)
above cannot be made, (A) the Special Servicer has previously determined in
accordance with the Servicing Standard, on the same basis as described in
clause (c)(i) above, that it would maximize the recovery to the
Certificateholders on a present value basis (the relevant discounting of
anticipated collections that will be distributable to Certificateholders to
be performed at the related Net Mortgage Rate) to acquire title to or
possession of the Mortgaged Property and to take such remedial, corrective
and/or other further actions as are necessary to bring the Mortgaged
Property into compliance with applicable environmental laws and regulations
and to appropriately address any of the circumstances and conditions
referred to in clause (c)(i) above, and (B) subject to Section 3.24(d), the
Controlling Class Representative has not objected to the Special Servicer's
doing so in accordance with Section 3.24(b).
Any such determination by the Special Servicer contemplated by clause (i)
or clause (ii) of the preceding paragraph shall be evidenced by an Officer's
Certificate to such effect delivered to the Trustee, the Servicer and the
Controlling Class Representative, specifying all of the bases for such
determination, such Officer's Certificate to be accompanied by all related
environmental reports. The cost of such Phase I Environmental Assessment and any
such additional environmental testing, as well as the cost of any remedial,
corrective or other further action contemplated by clause (ii) of the preceding
paragraph, shall be advanced by the Servicer at the direction of the Special
Servicer given in accordance with the Servicing Standard; provided, however,
that the Servicer shall not be obligated in connection therewith to advance any
funds which, if so advanced, would constitute a Nonrecoverable Servicing
Advance. Amounts so advanced shall be subject to reimbursement as Servicing
Advances in accordance with Section 3.05(a).
The Special Servicer shall not be liable to the Trust, the
Certificateholders or any other party hereto for: (i) any determination made by
the Special Servicer pursuant to this Section 3.09(c) in good faith in
accordance with the Servicing Standard, without negligence or misfeasance on the
part of the Special Servicer, based on the environmental testing contemplated
above with respect to any Mortgaged Property; or (ii) any action taken by the
Special Servicer (including its refraining from action) in good faith in
accordance with the Servicing Standard, without negligence or misfeasance on the
part of the Special Servicer, based on such determination.
(d) If neither of the conditions set forth in clauses (i) and (ii) of the
first sentence of Section 3.09(c) has been satisfied with respect to any
Mortgaged Property securing a defaulted Mortgage Loan, the Special Servicer
shall take such action as is in accordance with the Servicing Standard (other
than proceeding against the Mortgaged Property) and, at such time as it deems
appropriate, may, on behalf of the Trust, subject to Section 3.24, release all
or a portion of such Mortgaged Property from the lien of the related Mortgage.
(e) The Special Servicer shall report to the Trustee, the Servicer and the
Controlling Class Representative monthly in writing as to any actions taken by
the Special Servicer with respect to any Mortgaged Property as to which neither
of the conditions set forth in clauses (i) and (ii) of the first sentence of
Section 3.09(c) has been satisfied, in each case until the earliest to occur of
satisfaction of either of such conditions, release of the lien of the related
Mortgage on such Mortgaged Property and the related Mortgage Loan's becoming a
Corrected Mortgaged Loan.
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(f) The Special Servicer shall have the right to determine, in accordance
with the Servicing Standard, the advisability of seeking to obtain a deficiency
judgment if the state in which the Mortgaged Property is located and the terms
of the Mortgage Loan permit such an action and shall, in accordance with the
Servicing Standard, seek such deficiency judgment if it deems advisable.
(g) The Special Servicer shall prepare and file information returns with
respect to the receipt of mortgage interest received in a trade or business from
individuals, reports of foreclosures and abandonments of any Mortgaged Property
and information returns relating to cancellation of indebtedness income with
respect to any Mortgaged Property required by Sections 6050H, 6050J and 6050P of
the Code and shall deliver to the Trustee and the REMIC Administrator an
Officer's Certificate stating that such reports have been filed. Such
information returns and reports shall be in form and substance sufficient to
meet the reporting requirements imposed by Sections 6050H, 6050J and 6050P of
the Code. The Servicer shall promptly provide to the Special Servicer on a
timely basis all information in the Servicer's possession to be included in such
reports and information returns.
(h) As soon as the Special Servicer makes a Final Recovery Determination
with respect to any Mortgage Loan or REO Property, it shall promptly notify the
Trustee and the Servicer. The Special Servicer shall maintain accurate records,
prepared by a Servicing Officer, of each such Final Recovery Determination (if
any) and the basis thereof. Each such Final Recovery Determination (if any)
shall be evidenced by an Officer's Certificate delivered to the Trustee and the
Servicer no later than the third Business Day following such Final Recovery
Determination.
SECTION 3.10. Trustee to Cooperate; Release of Mortgage Files.
(a) Upon the payment in full of any Mortgage Loan, or the receipt by the
Servicer of a notification that payment in full shall be escrowed in a manner
customary for such purposes, the Servicer shall promptly so notify the Trustee
and request delivery to it of the related Mortgage File (such notice and request
to be effected by delivering to the Trustee a Request for Release in the form of
Exhibit D-1 attached hereto, which Request for Release shall be accompanied by
the form of any release or discharge to be executed by the Trustee and shall
include a statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the
Collection Account pursuant to Section 3.04(a) have been or will be so
deposited). Upon receipt of such Request for Release, the Trustee shall promptly
release, or cause any related Custodian to release, the related Mortgage File to
the Servicer and shall deliver to the Servicer such accompanying release or
discharge, duly executed. No expenses incurred in connection with any instrument
of satisfaction or deed of reconveyance shall be chargeable to the Collection
Account or the Distribution Account.
(b) If from time to time, and as appropriate for servicing or foreclosure
of any Mortgage Loan, the Servicer or the Special Servicer shall otherwise
require any Mortgage File (or any portion thereof), then, upon request of the
Servicer and receipt from the Servicer of a Request for Release in the form of
Exhibit D-1 attached hereto signed by a Servicing Officer thereof, or upon
request of the Special Servicer and receipt from the Special Servicer of a
Request for Release in the form of Exhibit D-2 attached hereto, the Trustee
shall release, or cause any related Custodian to release, such Mortgage File (or
portion thereof) to the Servicer or the Special Servicer, as the case may be.
Upon return of such Mortgage File (or portion thereof) to the Trustee or the
related Custodian, or upon the Special Servicer's delivery to the Trustee of an
Officer's Certificate stating that (i) such Mortgage Loan was liquidated and all
amounts received or to be received in connection with such liquidation that are
required to be deposited into the Collection Account
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pursuant to Section 3.04(a) have been or will be so deposited or (ii) such
Mortgage Loan has become an REO Property, a copy of the Request for Release
shall be returned by the Trustee to the Servicer or the Special Servicer, as
applicable.
(c) Within five Business Days of the Special Servicer's request therefor
(or, if the Special Servicer notifies the Trustee of an exigency, within such
shorter period as is reasonable under the circumstances), the Trustee shall
execute and deliver to the Special Servicer, in the form supplied to the Trustee
by the Special Servicer, any court pleadings, requests for trustee's sale or
other documents reasonably necessary to the foreclosure or trustee's sale in
respect of a Mortgaged Property or to any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or Mortgage or to obtain a
deficiency judgment, or to enforce any other remedies or rights provided by the
Mortgage Note or Mortgage or otherwise available at law or in equity or to
defend any legal action or counterclaim filed against the Trust, the Servicer or
the Special Servicer; provided that the Trustee may alternatively execute and
deliver to the Special Servicer, in the form supplied to the Trustee by the
Special Servicer, a limited power of attorney issued in favor of the Special
Servicer and empowering the Special Servicer to execute and deliver any or all
of such pleadings or documents on behalf of the Trustee (however, the Trustee
shall not be liable for any misuse of such power of attorney by the Special
Servicer). Together with such pleadings or documents (or such power of attorney
empowering the Special Servicer to execute the same on behalf of the Trustee),
the Special Servicer shall deliver to the Trustee an Officer's Certificate
requesting that such pleadings or documents (or such power of attorney
empowering the Special Servicer to execute the same on behalf of the Trustee) be
executed by the Trustee and certifying as to the reason such pleadings or
documents are required and that the execution and delivery thereof by the
Trustee (or by the Special Servicer on behalf of the Trustee) will not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee's sale.
SECTION 3.11. Servicing and Special Servicing Compensation; Interest on and
Reimbursement of Servicing Advances; Payment of Certain
Expenses; Obligations of the Trustee and any Fiscal Agent
regarding Back-up Servicing Advances.
(a) As compensation for its activities hereunder, the Servicer shall be
entitled to receive the Servicing Fee with respect to each Mortgage Loan
(including each Specially Serviced Mortgage Loan) and each REO Mortgage Loan. As
to each such Mortgage Loan and REO Mortgage Loan, the Servicing Fee shall accrue
from time to time (on the basis of a 360-day year consisting of twelve 30-day
months) at the Servicing Fee Rate on the same principal amount as interest
accrues from time to time on such Mortgage Loan or is deemed to accrue from time
to time on such REO Mortgage Loan. The Servicing Fee with respect to any
Mortgage Loan or REO Mortgage Loan shall cease to accrue if a Liquidation Event
occurs in respect thereof. Earned but unpaid Servicing Fees shall be payable
monthly, on a loan-by-loan basis, from payments of interest on each Mortgage
Loan and REO Revenues allocable as interest on each REO Mortgage Loan. The
Servicer shall be entitled to recover unpaid Servicing Fees in respect of any
Mortgage Loan or REO Mortgage Loan out of the portion any related Insurance
Proceeds or Liquidation Proceeds allocable as interest on such Mortgage Loan or
REO Mortgage Loan, as the case may be. The right to receive the Servicing Fee
may not be transferred in whole or in part except in connection with the
transfer of all of the Servicer's responsibilities and obligations under this
Agreement.
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(b) The Servicer shall be entitled to receive as additional servicing
compensation (the following items, collectively, "Additional Servicing
Compensation"):
(i) to the extent allocable to any Mortgage Loan for a period that it
is not a Specially Serviced Mortgage Loan or an REO Mortgage Loan, any Net
Default Charges collected on such Mortgage Loan;
(ii) in each case to the extent the particular fee exceeds $2,500, any
assumption fees, modification fees or extension fees actually paid by a
Mortgagor with respect to a Mortgage Loan that is not a Specially Serviced
Mortgage Loan;
(iii) any assumption application fees, charges for beneficiary
statements or demands and amounts collected for checks returned for
insufficient funds actually paid by a Mortgagor with respect to a Mortgage
Loan that is not a Specially Serviced Mortgage Loan;
(iv) any Prepayment Interest Excesses collected on the Mortgage Loans;
(v) interest or other income earned on deposits in the Collection
Account, in accordance with Section 3.06(b) (but only to the extent of the
Net Investment Earnings, if any, with respect to the Collection Account for
each Collection Period); and
(vi) to the extent not required to be paid to any Mortgagor under
applicable law or under the related Mortgage, any interest or other income
earned on deposits in the Servicing Accounts maintained by the Servicer.
To the extent that amounts described in clause (ii) or clause (iii) of the
preceding paragraph are collected by the Special Servicer with respect to
Mortgage Loans other than Specially Serviced Mortgage Loans, the Special
Servicer shall promptly pay such amounts to the Servicer.
(c) As compensation for its activities hereunder, the Special Servicer
shall be entitled to receive the Special Servicing Fee with respect to each
Specially Serviced Mortgage Loan and each REO Mortgage Loan. As to each
Specially Serviced Mortgage Loan and REO Mortgage Loan, the Special Servicing
Fee shall accrue from time to time (on the basis of a 360-day year consisting of
twelve 30-day months) at the Special Servicing Fee Rate on the same principal
amount as interest accrues from time to time on such Mortgage Loan or is deemed
to accrue from time to time on such REO Mortgage Loan; provided that, if and for
so long as such principal amount exceeds $3,000,000, then such Special Servicing
Fee shall accrue on the portion of such principal amount that is in excess of
$3,000,000 at the Reduced Special Servicing Fee Rate (instead of at the Special
Servicing Fee Rate); and provided, further, that, for purposes of determining
the applicability of the immediately preceding proviso, any Specially Serviced
Mortgage Loans that are cross-collateralized and cross-defaulted with each other
will be treated as a single Mortgage Loan.. The Special Servicing Fee with
respect to any Specially Serviced Mortgage Loan or REO Mortgage Loan shall cease
to accrue as of the date a Liquidation Event occurs in respect thereof or it
becomes a Corrected Mortgage Loan. Earned but unpaid Special Servicing Fees
shall be payable monthly out of general collections on the Mortgage Loans and
any REO Properties on deposit in the Collection Account pursuant to Section
3.05(a).
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As further compensation for its activities hereunder, the Special Servicer
shall be entitled to receive the Workout Fee with respect to each Corrected
Mortgage Loan. As to each Corrected Mortgage Loan, the Workout Fee shall be
payable out of, and shall be calculated by application of the Workout Fee Rate
to, each collection of interest and principal (net of related unpaid or
unreimbursed Servicing Fees, Special Servicing Fees, Advances and Advance
Interest) received on such Mortgage Loan for so long as it remains a Corrected
Mortgage Loan. The Workout Fee with respect to any Corrected Mortgage Loan will
cease to be payable if a Servicing Transfer Event occurs with respect thereto or
if the related Mortgaged Property becomes an REO Property; provided that a new
Workout Fee would become payable if and when such Mortgage Loan again became a
Corrected Mortgage Loan. If the Special Servicer is terminated other than for
cause or resigns in accordance with Section 6.04, it shall retain the right to
receive any and all Workout Fees payable in respect of Mortgage Loans that
became Corrected Mortgage Loans during the period that it acted as Special
Servicer and that were still Corrected Mortgage Loans at the time of such
termination or resignation (and the successor Special Servicer shall not be
entitled to any portion of such Workout Fees), in each case until the Workout
Fee for any such loan ceases to be payable in accordance with the preceding
sentence.
As further compensation for its activities hereunder, the Special Servicer
shall also be entitled to receive a Liquidation Fee with respect to each
Specially Serviced Mortgage Loan or REO Property as to which it receives any
full or discounted payoff from the related Mortgagor or any Liquidation Proceeds
or Insurance Proceeds (other than in connection with the purchase of any such
Specially Serviced Mortgage Loan or REO Property by the Servicer, the Special
Servicer or a Majority Certificateholder of the Controlling Class pursuant to
Section 3.18 or Section 9.01, or the purchase or replacement thereof by a Third
Party Originator pursuant to the related Third Party Originator Agreement or the
purchase or replacement thereof by the Seller pursuant to the Mortgage Loan
Purchase and Sale Agreement). As to each such Specially Serviced Mortgage Loan
or REO Property, the Liquidation Fee shall be payable out of, and shall be
calculated by application of the Liquidation Fee Rate to, such full or
discounted payoff, Liquidation Proceeds and/or Insurance Proceeds, in each case
net of any portion of such payment or proceeds payable or reimbursable to the
Servicer or the Special Servicer to cover related unpaid or unreimbursed
Servicing Fees, Special Servicing Fees, Advances and/or Advance Interest. The
Liquidation Fee with respect to any such Specially Serviced Mortgage Loan will
not be payable if such Mortgage Loan becomes a Corrected Mortgage Loan.
Notwithstanding anything herein to the contrary, no Liquidation Fee will be
payable in connection with the receipt of, or out of, Liquidation Proceeds
collected as a result of the purchase or substitution of any Specially Serviced
Mortgage Loan or REO Property described in the parenthetical to the first
sentence of this paragraph.
The Special Servicer's right to receive the Special Servicing Fee, the
Workout Fee and/or the Liquidation Fee may not be transferred in whole or in
part except in connection with the transfer of all of the Special Servicer's
responsibilities and obligations under this Agreement.
(d) The Special Servicer shall be entitled to receive as additional special
servicing compensation (the following items, collectively, the "Additional
Special Servicing Compensation"):
(i) to the extent allocable to any Mortgage Loan for the period that
it is a Specially Serviced Mortgage Loan or after it has become an REO
Mortgage Loan, any Net Default Charges collected on such Mortgage Loan or
REO Mortgage Loan
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(ii) any assumption fees, assumption application fees, modification
fees, extension fees, charges for beneficiary statements or demands and
amounts collected for checks returned for insufficient funds that are
actually received on or with respect to Specially Serviced Mortgage Loans
or REO Mortgage Loans; and
(iii) any assumption fees, modification fees or extension fees that
are actually received in connection with an assumption, modification or
extension reviewed by the Special Servicer that relates to a Mortgage Loan
that is not a Specially Serviced Mortgage Loan (provided that the portion
of any such fee payable to the Special Servicer shall not exceed $2,500,
with the excess to be paid as Additional Servicing Compensation to the
Servicer); and
(iv) interest or other income earned on deposits in the REO Account,
if established, in accordance with Section 3.06(b) (but only to the extent
of the Net Investment Earnings, if any, with respect to the REO Account for
each Collection Period).
To the extent that amounts described in clause (ii) of the preceding
paragraph are collected by the Servicer with respect to Specially Serviced
Mortgage Loans or that amounts described in clause (iii) of the preceding
paragraph due to the Special Servicer are collected by the Servicer with respect
to any Mortgage Loan, the Servicer shall promptly pay such amounts to the
Special Servicer and shall not be required to deposit such amounts in the
Collection Account pursuant to Section 3.04(a).
(e) The Servicer and the Special Servicer shall each be required (subject
to Section 3.11(h) below) to pay out of its own funds all expenses incurred by
it in connection with its servicing activities hereunder (including, without
limitation, payment of any amounts due and owing to any of Sub-Servicers
retained by it and the premiums for any blanket policy obtained by it insuring
against hazard losses pursuant to Section 3.07(b)), if and to the extent such
expenses are not payable directly out of the Collection Account or the REO
Account, and neither the Servicer nor the Special Servicer shall be entitled to
reimbursement for any such expense incurred by it except as expressly provided
in this Agreement. If the Servicer is required to make any Servicing Advance
hereunder at the direction of the Special Servicer, the Special Servicer shall
promptly provide the Servicer with such information and documentation regarding
the subject Advance as the Servicer may reasonably request.
(f) If the Servicer or Special Servicer is required under this Agreement to
make a Servicing Advance, but neither does so within 15 days after such Advance
is required to be made, the Trustee shall, if it has actual knowledge of such
failure on the part of the Servicer or Special Servicer, as the case may be,
give notice of such failure, as applicable, to the Servicer and the Special
Servicer. If such Advance is not made by the Servicer or the Special Servicer
within three Business Days after such notice, then (subject to Section 3.11(h)
below) the Trustee or a Fiscal Agent appointed thereby shall make such Advance.
If the Fiscal Agent makes any such Servicing Advance, the Trustee shall be
deemed not to be in default under this Agreement for failing to do so.
(g) The Servicer, the Special Servicer, the Trustee and any Fiscal Agent
shall each be entitled to receive interest at the Reimbursement Rate in effect
from time to time, accrued on the amount of each Servicing Advance made thereby
(with its own funds) for so long as such Servicing Advance is outstanding, such
interest to be payable: (i) at any time, out of Default Charges collected on or
in respect of the particular Mortgage Loan or REO Property as to which such
Servicing Advance relates; and (ii) to the extent that such Default Charges are
insufficient, but only after the related Advance has been reimbursed
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pursuant to this Agreement, out of general collections on the Mortgage Loans and
REO Properties on deposit in the Collection Account. The Servicer shall
reimburse itself, the Special Servicer, the Trustee or any Fiscal Agent, as
appropriate, for any Servicing Advance made by any such Person as soon as
practicable after funds available for such purpose are deposited in the
Collection Account.
(h) Notwithstanding anything to the contrary set forth herein, none of the
Servicer, the Special Servicer, the Trustee or any Fiscal Agent shall be
required to make any Servicing Advance that it determines in its reasonable,
good faith judgment would constitute a Nonrecoverable Servicing Advance. The
determination by any Person with an obligation hereunder to make Servicing
Advances that it has made a Nonrecoverable Servicing Advance or that any
proposed Servicing Advance, if made, would constitute a Nonrecoverable Servicing
Advance, shall be made by such Person in its reasonable, good faith judgment and
shall be evidenced by an Officer's Certificate delivered promptly to the Trustee
(unless it is the Person making such determination), the Depositor, the
Controlling Class Representative and, if not already included among the
foregoing, any Majority Certificateholder of the Controlling Class, setting
forth the basis for such determination, accompanied by a copy of an Appraisal of
the related Mortgaged Property or REO Property performed within the twelve
months preceding such determination, and further accompanied by any other
information, including engineers' reports, environmental surveys or similar
reports, that such Person may have obtained and that support such determination.
Notwithstanding the foregoing, the Trustee and any Fiscal Agent shall be
entitled to conclusively rely on any determination of nonrecoverability that may
have been made by the Servicer or the Special Servicer with respect to a
particular Servicing Advance, and the Servicer and the Special Servicer shall
each be entitled to conclusively rely on any determination of nonrecoverability
that may have been made by the other such party with respect to a particular
Servicing Advance. A copy of any such Officer's Certificate (and accompanying
information) of the Servicer shall also be delivered promptly to the Special
Servicer, a copy of any such Officer's Certificate (and accompanying
information) of the Special Servicer shall also be promptly delivered to the
Servicer, and a copy of any such Officer's Certificates (and accompanying
information) of the Trustee or the Fiscal Agent shall also be promptly delivered
to the Servicer and the Special Servicer.
(i) Notwithstanding anything to the contrary set forth herein, the Servicer
shall (at the direction of the Special Servicer if a Specially Serviced Mortgage
Loan or an REO Property is involved) pay directly out of the Collection Account
any servicing expense that, if paid by the Servicer or the Special Servicer,
would constitute a Nonrecoverable Servicing Advance; provided that the Servicer
(or the Special Servicer, if a Specially Serviced Mortgage Loan or an REO
Property is involved) has determined in accordance with the Servicing Standard
that making such payment is in the best interests of the Certificateholders (as
a collective whole), as evidenced by an Officer's Certificates delivered
promptly to the Trustee, the Depositor, the Controlling Class Representative
and, if not already included among the foregoing, any Majority Certificateholder
of the Controlling Class, setting forth the basis for such determination and
accompanied by any information that such Person may have obtained that supports
such determination. A copy of any such Officer's Certificate (and accompanying
information) of the Servicer shall also be delivered promptly to the Special
Servicer, and a copy of any such Officer's Certificate (and accompanying
information) of the Special Servicer shall also be promptly delivered to the
Servicer.
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SECTION 3.12. Property Inspections; Collection of Financial Statements;
Delivery of Certain Reports.
(a) The Special Servicer shall at its expense perform or cause to be
performed a physical inspection of a Mortgaged Property as soon as practicable
(but in any event not later than 60 days) after the related Mortgage Loan
becomes a Specially Serviced Mortgage Loan; provided that reasonable
"out-of-pocket" travel expenses of the Special Servicer under such circumstances
will constitute a Servicing Advance. Beginning in 1999, the Servicer shall at
its expense perform or cause to be performed an inspection of each Mortgaged
Property at least once per calendar year (or, in the case of each Mortgage Loan
with a Stated Principal Balance of under $2,000,000, once every two years), if
the Special Servicer has not already done so during that period pursuant to the
preceding sentence (it being understood and agreed that the Servicer will
inspect each and every Mortgaged Property in 1999). The Servicer and the Special
Servicer shall each prepare a written report of each such inspection performed
by it or on its behalf that sets forth in detail the condition of the Mortgaged
Property and that specifies the occurrence or existence of: (i) any sale,
transfer or abandonment of the Mortgaged Property of which the Servicer or
Special Servicer, as applicable, is aware, (ii) any change in the condition,
occupancy, or value of the Mortgaged Property that the Servicer or the Special
Servicer, as applicable, in accordance with the Servicing Standard, considers
material, or (iii) any waste committed on the Mortgaged Property. The Servicer
and the Special Servicer shall each deliver to the Trustee, the Depositor, the
Underwriter, the Controlling Class Representative, each other and, upon request
thereby, any Certificateholder verified as such by the Trustee, a copy (or image
in suitable electronic media) of each such written report prepared by it within
60 days of completion of the related inspection.
(b) The Special Servicer, in the case of any Specially Serviced Mortgage
Loan, and the Servicer, in the case of all other Mortgage Loans, shall make
reasonable efforts to collect promptly from each related Mortgagor quarterly and
annual operating statements, budgets and rent rolls of the related Mortgaged
Property, and financial statements of such Mortgagor, whether or not delivery of
such items is required pursuant to the terms of the related Mortgage. Such
efforts shall, as and when necessary, include a letter sent to the related
Mortgagor (followed up with telephone calls) requesting such annual quarterly
and annual operating statements and rent rolls until they are received (to the
extent such action is consistent with applicable law). Without limiting the
generality of the foregoing, within 60 days after the Closing Date, the Servicer
shall send a letter to each Mortgagor under the Mortgage Loans requesting that
such Mortgagor deliver annual operating statements and rent rolls for the
related Mortgaged Property for the most recently ended fiscal year. In addition,
the Special Servicer shall cause quarterly and annual operating statements,
budgets and rent rolls to be regularly prepared in respect of each REO Property
and shall collect all such items promptly following their preparation. The
Servicer and the Special Servicer shall each deliver copies of all of the
foregoing items so collected thereby to the Trustee, the Depositor, the
Underwriter, the Controlling Class Representative, each other and, if not
already included among the foregoing, any Majority Certificateholder of the
Controlling Class, in each case within 60 days of its receipt thereof. The
Servicer and the Special Servicer shall each deliver copies of all of the
foregoing items so collected thereby in respect of the Showboat Loan and/or
Showboat Property to the Rating Agencies, within 60 days of its receipt thereof,
and shall promptly notify the Rating Agencies if the Debt Service Coverage Ratio
of the Showboat Loan falls below 1.0x.
Within 30 days after receipt by the Servicer (from the Special Servicer in
the case of Specially Serviced Mortgage Loans and REO Properties) of any annual
operating statements or rent rolls with respect to any Mortgaged Property or REO
Property, the Servicer shall, based upon such operating statements or rent
rolls, prepare (or, if previously prepared, update) the written analysis of
operations (the "Operating
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Statement Analysis") to be maintained by the Servicer with respect to such
Mortgaged Property and REO Property and shall forward a copy thereof to the
Trustee, the Special Servicer, the Controlling Class Representative and, upon
request thereby, any Certificateholder verified as such by the Trustee, together
with such operating statements or rent rolls. The Servicer shall maintain an
Operating Statement Analysis with respect to each Mortgaged Property and REO
Property. Each such Operating Statement Analysis shall be substantially in the
form of Exhibit E-5 attached hereto (or, at the discretion of the Servicer
(provided that no less information is provided than is set forth on Exhibit E-5
hereto), in a CSSA format).
SECTION 3.13. Annual Statement as to Compliance.
Each of the Servicer and the Special Servicer shall deliver to the Trustee,
the Depositor, the Underwriter, the Controlling Class Representative and each
other, on or before March 15 of each year, beginning in 1999, an Officer's
Certificate (the "Annual Performance Certification") stating, as to the signer
thereof, that (i) a review of the activities of the Servicer or the Special
Servicer, as the case may be, during the preceding calendar year 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
or the Special Servicer, as the case may be, has fulfilled all of its
obligations under this Agreement in all material respects throughout such year
(or, if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officer and the nature and status
thereof), and (iii) the Servicer or the Special Servicer, as the case may be,
has received no notice regarding the qualification, or challenging the status,
of any REMIC Pool as a REMIC from the IRS or any other governmental agency or
body (or, if it has received any such notice, specifying the details thereof).
SECTION 3.14. Reports by Independent Public Accountants.
On or before March 15 of each year, beginning in 1999, each of the Servicer
and the Special Servicer at its expense shall cause a firm of independent public
accountants that is a member of the American Institute of Certified Public
Accountants to furnish a statement (the "Annual Accountants' Report") to the
Trustee, the Depositor, the Underwriter, the Controlling Class Representative
and each other, to the effect that such firm has examined such documents and
records as it has deemed necessary and appropriate relating to the Servicer's or
the Special Servicer's, as the case may be, servicing of the Mortgage Loans
under this Agreement or the servicing of mortgage loans similar to the Mortgage
Loans under substantially similar agreements for the preceding calendar year (or
during the period from the date of commencement of the Servicer's or the Special
Servicer's, as the case may be, duties hereunder until the end of such preceding
calendar year in the case of the first statement) and that the assertion of the
management of the Servicer or the Special Servicer, as the case may be, that it
maintained an effective internal control system over servicing of the Mortgage
Loans or similar mortgage loans is fairly stated in all material respects, based
upon established criteria, which statement meets the standards applicable to
accountants' reports intended for general distribution; provided that each of
the Servicer and the Special Servicer shall not be required to cause the
delivery of its Annual Accountants' Report until April 15 in any given year so
long as it has received written confirmation from the Depositor that a Report on
Form 10-K is not required to be filed in respect of the Trust for the preceding
calendar year. In rendering its report such firm may rely, as to matters
relating to the direct servicing of securitized commercial and multifamily
mortgage loans by sub-servicers, upon comparable reports of firms of independent
certified public accountants rendered on the basis of examinations conducted in
accordance with the same standards (rendered within one year of such report)
with respect to those sub-servicers.
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The Servicer and the Special Servicer will each reasonably cooperate with
the Depositor in providing any other form of accountants' reports as may be
required by the Commission in connection with the Commission's issuance of a
no-action letter relating to the Depositor's reporting requirements in respect
of the Trust pursuant to the Exchange Act, and the reasonable additional costs
of providing such other forms of accountants' reports shall be borne by the
Depositor.
SECTION 3.15. Access to Certain Information.
Each of the Servicer and the Special Servicer shall afford to the Trustee,
any Fiscal Agent, the Depositor, the Underwriter, each Rating Agency and the
Controlling Class Representative, and to the OTS, the FDIC and any other banking
or insurance regulatory authority that may exercise authority over any
Certificateholder or Certificate Owner, access to any records regarding the
Mortgage Loans and the servicing thereof within its control, except to the
extent it is prohibited from doing so by applicable law or contract entered into
prior to the Closing Date or to the extent such information is subject to a
privilege under applicable law to be asserted on behalf of the
Certificateholders. Such access shall be afforded without charge but only upon
reasonable prior written request and during normal business hours at the offices
of the Servicer or the Special Servicer, as the case may be, designated by it.
The Servicer and the Special Servicer shall each be entitled to affix a
reasonable disclaimer to any information provided by it for which it is not the
original source (without suggesting liability on the part of any other party
hereto).
SECTION 3.16. Title to REO Property; REO Account.
(a) If title to any REO Property is acquired, the deed or certificate of
sale shall be issued to the Trustee on behalf of the Certificateholders. The
Special Servicer, on behalf of the Trust, shall sell any REO Property by the end
of the third calendar year following the year in which the Trust acquires
ownership of such REO Property for purposes of Section 860G(a)(8) of the Code,
unless the Special Servicer either (i) applies, more than sixty days prior to
the expiration of such liquidation period, and is granted an extension of time
(an "REO Extension") by the IRS to sell such REO Property or (ii) obtains for
the Trustee and the REMIC Administrator an Opinion of Counsel, addressed to the
Trustee and the REMIC Administrator, to the effect that the holding by the Trust
of such REO Property subsequent to the end of the third calendar year following
the year in which such acquisition occurred will not result in an Adverse REMIC
Event with respect to any REMIC Pool. Regardless of whether the Special Servicer
applies for or is granted the REO Extension contemplated by clause (i) of the
immediately preceding sentence or obtains the Opinion of Counsel referred to in
clause (ii) of such sentence, the Special Servicer shall act in accordance with
the Servicing Standard to liquidate such REO Property on a timely basis. If the
Special Servicer is granted such REO Extension or obtains such Opinion of
Counsel, the Special Servicer shall sell such REO Property within such extended
period as is permitted by such REO Extension or contemplated by such Opinion of
Counsel, as the case may be. Any expense incurred by the Special Servicer in
connection with its applying for and being granted the REO Extension
contemplated by clause (i) of the third preceding sentence or its obtaining the
Opinion of Counsel contemplated by clause (ii) of the third preceding sentence,
shall be covered by, and be reimbursable as, a Servicing Advance.
(b) The Special Servicer shall segregate and hold all funds collected and
received in connection with any REO Property separate and apart from its own
funds and general assets. If an REO Acquisition shall occur, the Special
Servicer shall establish and maintain one or more accounts (collectively, the
"REO Account"), to be held on behalf of the Trustee in trust for the benefit of
the Certificateholders, for the retention of revenues and other proceeds derived
from each REO Property. Each account that constitutes
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the REO Account shall be an Eligible Account. The Special Servicer shall
deposit, or cause to be deposited, in the REO Account, upon receipt, all REO
Revenues, Insurance Proceeds and Liquidation Proceeds received in respect of an
REO Property. Funds in the REO Account may be invested in Permitted Investments
in accordance with Section 3.06. The Special Servicer shall be entitled to make
withdrawals from the REO Account to pay itself, as Additional Special Servicing
Compensation, interest and investment income earned in respect of amounts held
in the REO Account as provided in Section 3.06(b) (but only to the extent of the
Net Investment Earnings, if any, with respect to the REO Account for any
Collection Period). The Special Servicer shall give notice to the other parties
hereto of the location of the REO Account when first established and of the new
location of the REO Account prior to any change thereof.
(c) The Special Servicer shall withdraw from the REO Account funds
necessary for the proper operation, management, leasing, maintenance and
disposition of any REO Property, but only to the extent of amounts on deposit in
the REO Account relating to such REO Property. Within one Business Day following
the end of each Collection Period, the Special Servicer shall withdraw from the
REO Account and deposit into the Collection Account or deliver to the Servicer
(which shall deposit such amounts into the Collection Account) the aggregate of
all amounts received in respect of each REO Property during such Collection
Period, net of any withdrawals made out of such amounts pursuant to the
preceding sentence; provided that the Special Servicer may retain in the REO
Account such portion of such proceeds and collections as may be necessary to
maintain a reserve of sufficient funds for the proper operation, management,
leasing, maintenance and disposition of the related REO Property (including the
creation of a reasonable reserve for repairs, replacements, necessary capital
improvements, reasonable travel expenses and other related expenses), such
reserve not to exceed an amount sufficient to cover such items reasonably
expected to be incurred during the following twelve-month period.
(d) The Special Servicer shall keep and maintain separate records, on a
property-by-property basis, for the purpose of accounting for all deposits to,
and withdrawals from, the REO Account pursuant to Section 3.16(b) or (c).
SECTION 3.17. Management of REO Property.
(a) Prior to the acquisition of title to any Mortgaged Property securing a
defaulted Mortgage Loan, the Special Servicer shall review the operation of such
Mortgaged Property and determine the nature of the income that would be derived
from such property if it were acquired by the Trust. If the Special Servicer
determines from such review that:
(i) None of the income from Directly Operating such Mortgaged Property
would be subject to tax as "net income from foreclosure property" within
the meaning of the REMIC Provisions or to the tax imposed on "prohibited
transactions" under Section 860F of the Code (either such tax referred to
herein as an "REO Tax"), such Mortgaged Property may be Directly Operated
by the Special Servicer as REO Property;
(ii) Directly Operating such Mortgaged Property as an REO Property
could result in income from such property that would be subject to an REO
Tax, but that a lease of such property to another party to operate such
property, or the performance of some services by an Independent Contractor
with respect to such property, or another method of operating such property
would not result in income subject to an REO Tax, then the Special Servicer
may (provided that in the judgment of the Special Servicer, exercised in
accordance with the
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Servicing Standard, it is commercially reasonable) so lease or otherwise
operate such REO Property; or
(iii) It is reasonable to believe that Directly Operating such
property as REO Property could result in income subject to an REO Tax and
that no commercially reasonable means exists to operate such property as
REO Property without the Trust incurring or possibly incurring an REO Tax
on income from such property, the Special Servicer shall deliver to the
REMIC Administrator, in writing, a proposed plan (the "Proposed Plan") to
manage such property as REO Property. Such plan shall include potential
sources of income and good faith estimates of the amount of income from
each such source. Within a reasonable period of time after receipt of such
plan, the REMIC Administrator shall consult with the Special Servicer and
shall advise the Special Servicer of the Trust's federal income tax
reporting position with respect to the various sources of income that the
Trust would derive under the Proposed Plan. In addition, the REMIC
Administrator shall (to the maximum extent reasonably possible) advise the
Special Servicer of the estimated amount of taxes that the Trust would be
required to pay with respect to each such source of income. After receiving
the information described in the two preceding sentences from the REMIC
Administrator, the Special Servicer shall either (A) implement the Proposed
Plan (after acquiring the respective Mortgaged Property as REO Property) or
(B) manage and operate such property in a manner that would not result in
the imposition of an REO Tax on the income derived from such property.
The Special Servicer's decision as to how each REO Property shall be
managed and operated shall be in accordance with the Servicing Standard. Neither
the Special Servicer nor the REMIC Administrator shall be liable to the
Certificateholders, the Trust, the other parties hereto or each other for errors
in judgment made in good faith in the exercise of their discretion while
performing their respective responsibilities under this Section 3.17(a). Nothing
in this Section 3.17(a) is intended to prevent the sale of a Defaulted Mortgage
Loan or REO Property pursuant to the terms and subject to the conditions of
Section 3.18.
(b) If title to any REO Property is acquired, the Special Servicer shall
manage, conserve, protect and operate such REO Property for the benefit of the
Certificateholders solely for the purpose of its disposition and sale in a
manner that does not cause such REO Property to fail to qualify as "foreclosure
property" within the meaning of Section 860G(a)(8) of the Code or, except as
contemplated by Section 3.17(a), result in the receipt by any REMIC Pool of any
"income from non-permitted assets" within the meaning of Section 860F(a)(2)(B)
of the Code or in an Adverse REMIC Event with respect to any REMIC Pool. Except
as contemplated by Section 3.17(a), the Special Servicer shall not enter into
any lease, contract or other agreement that causes the Trust to receive, and
(unless required to do so under any lease, contract or agreement to which the
Special Servicer or the Trust may become a party or successor to a party due to
a foreclosure, deed-in-lieu of foreclosure or other similar exercise of a
creditor's rights or remedies with respect to a Mortgage Loan) shall not cause
or allow the Trust to receive, any "net income from foreclosure property" that
is subject to taxation under the REMIC Provisions. Subject to the foregoing,
however, the Special Servicer shall have full power and authority to do any and
all things in connection therewith as are consistent with the Servicing Standard
and, consistent therewith, shall withdraw from the REO Account, to the extent of
amounts on deposit therein with respect to any REO Property, funds necessary for
the proper operation, management, maintenance and disposition of such REO
Property, including:
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(i) all insurance premiums due and payable in respect of such REO
Property;
(ii) all real estate taxes and assessments in respect of such REO
Property that may result in the imposition of a lien thereon;
(iii) any ground rents in respect of such REO Property; and
(iv) all other costs and expenses necessary to maintain, lease, sell,
protect, manage, operate and restore such REO Property.
To the extent that amounts on deposit in the REO Account in respect of any REO
Property are insufficient for the purposes contemplated by the preceding
sentence with respect to such REO Property, the Servicer shall, at the direction
of the Special Servicer, advance such amounts as are necessary for such purposes
unless the Servicer or the Special Servicer determines, in its reasonable, good
faith judgment, that such advances would, if made, be Nonrecoverable Servicing
Advances; provided, however, that the Servicer may make any such Servicing
Advance without regard to recoverability if it is a necessary fee or expense
incurred in connection with the defense or prosecution of legal proceedings.
(c) The Special Servicer may contract with any Independent Contractor for
the operation and management of any REO Property, provided that:
(i) the terms and conditions of any such contract may not be
inconsistent herewith and shall reflect an agreement reached at arm's
length;
(ii) the fees of such Independent Contractor (which shall be expenses
of the Trust) shall be reasonable and customary in consideration of the
nature and locality of the REO Property;
(iii) any such contract shall require, or shall be administered to
require, that the Independent Contractor, in a timely manner, (A) pay all
costs and expenses incurred in connection with the operation and management
of such REO Property, including those listed in Section 3.17(b) above, and
(B) remit all related revenues collected (net of its fees and such costs
and expenses) to the Special Servicer upon receipt;
(iv) none of the provisions of this Section 3.17(c) relating to any
such contract or to actions taken through any such Independent Contractor
shall be deemed to relieve the Special Servicer of any of its duties and
obligations hereunder with respect to the operation and management of any
such REO Property; and
(v) the Special Servicer shall be obligated with respect thereto to
the same extent as if it alone were performing all duties and obligations
in connection with the operation and management of such REO Property.
The Special Servicer shall be entitled to enter into any agreement with any
Independent Contractor performing services for it related to its duties and
obligations hereunder for indemnification of the Special Servicer by such
Independent Contractor, and nothing in this Agreement shall be deemed to limit
or modify
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such indemnification. To the extent the costs of any contract with any
Independent Contractor for the operation and management of any REO Property are
greater that the revenues available from such property, such excess costs shall
be covered by, and be reimbursable as, a Servicing Advance.
SECTION 3.18. Sale of Mortgage Loans and REO Properties.
(a) The parties hereto may sell or purchase, or permit the sale or purchase
of, a Mortgage Loan or REO Property only on the terms and subject to the
conditions set forth in this Section 3.18 or as otherwise expressly provided in
or contemplated by Sections 2.02, 2.03 and 9.01.
(b) If the Special Servicer has determined, in its reasonable good faith
judgment, that any Defaulted Mortgage Loan will become subject to foreclosure
proceedings and that the sale of such Mortgage Loan under the circumstances
described in this Section 3.18 is in accordance with the Servicing Standard, the
Special Servicer shall promptly so notify in writing the Trustee and the
Servicer, and the Trustee shall, within 5 days after receipt of such notice,
notify the Majority Certificateholder, if any, of the Controlling Class. The
Majority Certificateholder of the Controlling Class may, at its option, within
30 days after receipt of such notice, purchase any such Defaulted Mortgage Loan
out of the Trust Fund at a cash price equal to the applicable Purchase Price.
The Purchase Price for any Defaulted Mortgage Loan purchased under this Section
3.18(b) shall be deposited into the Collection Account, and the Trustee, upon
receipt of an Officer's Certificate from the Servicer to the effect that such
deposit has been made, shall release or cause to be released to the
Certificateholder effecting such purchase the related Mortgage File, and shall
execute and deliver such instruments of transfer or assignment, in each case
without recourse, as shall be provided to it and are reasonably necessary to
vest in such Certificateholder ownership of such Mortgage Loan. In connection
with any such purchase, the Special Servicer shall deliver the related Servicing
File to the Certificateholder effecting such purchase.
(c) If the Majority Certificateholder of the Controlling Class has not
purchased any Defaulted Mortgage Loan described in the first sentence of Section
3.18(b) within 30 days of its having received notice in respect thereof pursuant
to Section 3.18(b) above, then the Trustee shall within 5 days of the end of
such 30-day period send notice to the Servicer and the Special Servicer that
such Majority Certificateholder has not purchased such Mortgage Loan, and either
the Servicer or the Special Servicer may, at its option, within 30 days after
receipt of such notice, purchase such Mortgage Loan out of the Trust Fund at a
cash price equal to the Purchase Price (it being understood and agreed that, for
so long as Clarion Partners, LLC or any successor in interest thereto or
Affiliate thereof acts as Special Servicer, it shall have priority with regard
to effecting any such purchase, but that, if neither Clarion Partners, LLC nor
any successor in interest thereto or Affiliate thereof is the Special Servicer,
the party giving written notice to the Trustee first with regard to its
intention to so purchase any such Defaulted Mortgage Loan shall have preference
in effecting any such purchase). The Purchase Price for any such Mortgage Loan
purchased under this Section 3.18(c) shall be deposited into the Collection
Account, and the Trustee, upon receipt of an Officer's Certificate from the
Servicer to the effect that such deposit has been made, shall release or cause
to be released to the Servicer or the Special Servicer, as applicable, the
related Mortgage File, and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, as shall be provided to
it and are reasonably necessary to vest in the Servicer or the Special Servicer,
as applicable, the ownership of such Mortgage Loan. In connection with any such
purchase by the Servicer, the Special Servicer shall deliver the related
Servicing File to the Servicer.
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(d) The Special Servicer may offer to sell any Defaulted Mortgage Loan not
otherwise purchased pursuant to Section 3.18(b) or Section 3.18(c) above, if and
when the Special Servicer determines, consistent with the Servicing Standard,
that such a sale would be in the best economic interests of the
Certificateholders (as a collective whole). Such offer shall be made in a
commercially reasonable manner (which, for purposes hereof, includes an offer to
sell without representation or warranty other than customary warranties of title
and condition, if liability for breach thereof is limited to recourse against
the Trust) for a period of not less than 10 days. Subject to Sections 3.18(h)
and 3.24, the Special Servicer shall accept the highest cash bid received from
any Person that constitutes a fair price for such Mortgage Loan. In the absence
of any bid determined as provided below to be fair, the Special Servicer shall
proceed with respect to such Defaulted Mortgage Loan in accordance with Section
3.09.
The Special Servicer shall use its best efforts to solicit bids for each
REO Property in such manner as will be reasonably likely to realize a fair price
within the time period provided for by Section 3.16(a). Subject to Sections
3.18(h) and 3.24, the Special Servicer shall accept the first (and, if multiple
bids are received by a specified bid date, the highest) cash bid received from
any Person that constitutes a fair price (determined pursuant to Section 3.18(e)
below) for such REO Property. If the Special Servicer reasonably believes that
it will be unable to realize a fair price (determined pursuant to Section
3.18(e) below) for any REO Property within the time constraints imposed by
Section 3.16(a), the Special Servicer shall, subject to Section 3.24, dispose of
such REO Property upon such terms and conditions as the Special Servicer shall
deem necessary and desirable to maximize the recovery thereon under the
circumstances.
The Special Servicer shall give the Trustee and the Servicer not less than
five Business Days' prior written notice of its intention to sell any Defaulted
Mortgage Loan or REO Property pursuant to this Section 3.18(d). No Interested
Person shall be obligated to submit a bid to purchase any such Mortgage Loan or
REO Property, and notwithstanding anything to the contrary herein, neither the
Trustee, in its individual capacity, nor any of its Affiliates may bid for or
purchase any Defaulted Mortgage Loan or REO Property pursuant hereto.
(e) Whether any cash bid constitutes a fair price for any Defaulted
Mortgage Loan or REO Property, as the case may be, for purposes of Section
3.18(d), shall be determined by the Special Servicer or, if such cash bid is
from an Interested Person, by the Trustee. In determining whether any bid
received from an Interested Person represents a fair price for any such Mortgage
Loan or REO Property, the Trustee shall be supplied with and shall be entitled
to rely on the most recent Appraisal in the related Servicing File conducted in
accordance with this Agreement within the preceding 12-month period (or, in the
absence of any such Appraisal or if there has been a material change at the
subject property since any such Appraisal, on a new Appraisal to be obtained by
the Special Servicer (the cost of which shall be covered by, and be reimbursable
as, a Servicing Advance)). The appraiser conducting any such new Appraisal shall
be a Qualified Appraiser that is (i) selected by the Special Servicer if neither
the Special Servicer nor any Affiliate thereof is bidding with respect to a
Defaulted Mortgage Loan or REO Property and (ii) selected by the Trustee if
either the Special Servicer or any Affiliate thereof is so bidding. Where any
Interested Person is among those bidding with respect to a Defaulted Mortgage
Loan or REO Property, the Special Servicer shall require that all bids be
submitted to it (and, if the Special Servicer is bidding, shall be submitted by
it to the Trustee) in writing and be accompanied by a refundable deposit of cash
in an amount equal to 5% of the bid amount. In determining whether any bid from
a Person other than an Interested Person constitutes a fair price for any such
Mortgage Loan or REO Property, the Special Servicer shall take into account the
results of any Appraisal or updated Appraisal that it or the Servicer may have
obtained in accordance with this Agreement within the prior twelve months, and
any Qualified Appraiser shall be instructed to take into
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account, as applicable, among other factors, the period and amount of any
delinquency on the affected Mortgage Loan, the occupancy level and physical
condition of the Mortgaged Property or REO Property, the state of the local
economy and the obligation to dispose of any REO Property within the time period
specified in Section 3.16(a). The Purchase Price for any such Mortgage Loan or
REO Property shall in all cases be deemed a fair price. Notwithstanding the
other provisions of this Section 3.18, no cash bid from the Special Servicer or
any Affiliate thereof shall constitute a fair price for any Defaulted Mortgage
Loan or REO Property unless such bid is the highest cash bid received and at
least two independent bids (not including the bid of the Special Servicer or any
Affiliate) have been received. In the event the bid of the Special Servicer or
any Affiliate thereof is the only bid received or is the higher of only two bids
received, then additional bids shall be solicited. If an additional bid or bids,
as the case may be, are received and the original bid of the Special Servicer or
any Affiliate thereof is the highest of all cash bids received, then the bid of
the Special Servicer or such Affiliate shall be accepted, provided that the
Trustee has otherwise determined, as provided above in this Section 3.18(e),
that such bid constitutes a fair price for any Defaulted Mortgage Loan or REO
Property. Any bid by the Special Servicer shall be unconditional; and, if
accepted, the Defaulted Mortgage Loan or REO Property shall be transferred to
the Special Servicer without recourse, representation or warranty other than
customary representations as to title given in connection with the sale of a
mortgage loan or real property.
(f) Subject to Sections 3.18(a) through 3.18(e) above and Section 3.24, the
Special Servicer shall act on behalf of the Trustee in negotiating with
independent third parties and taking any other action necessary or appropriate
in connection with the sale of any Defaulted Mortgage Loan or REO Property, and
the collection of all amounts payable in connection therewith. In connection
therewith, the Special Servicer may charge prospective bidders, and may retain,
fees that approximate the Special Servicer's actual costs in the preparation and
delivery of information pertaining to such sales or evaluating bids without
obligation to deposit such amounts into the Collection Account. Any sale of a
Defaulted Mortgage Loan or any REO Property shall be final and without recourse
to the Trustee or the Trust, and if such sale is consummated in accordance with
the terms of this Agreement, neither the Special Servicer nor the Trustee shall
have any liability to any Certificateholder with respect to the purchase price
therefor accepted by the Special Servicer or the Trustee.
(g) Any sale of a Defaulted Mortgage Loan or any REO Property shall be for
cash only.
(h) Notwithstanding any of the foregoing paragraphs of this Section 3.18,
the Special Servicer shall not be obligated to accept the highest cash bid if
the Special Servicer determines, in accordance with the Servicing Standard, that
rejection of such bid would be in the best interests of the Certificateholders
(as a collective whole), and the Special Servicer may, subject to Section 3.24,
accept a lower cash bid (from any Person other than itself or an Affiliate) if
it determines, in accordance with the Servicing Standard, that acceptance of
such bid would be in the best interests of the Certificateholders (as a
collective whole) (for example, if the prospective buyer making the lower bid is
more likely to perform its obligations or the terms (other than price) offered
by the prospective buyer making the lower bid are more favorable).
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SECTION 3.19. Additional Obligations of Servicer.
(a) The Servicer shall deliver to the Trustee for deposit in the
Distribution Account on each Servicer Remittance Date, without any right of
reimbursement therefor, an amount equal to the lesser of (i) the aggregate
amount of Prepayment Interest Shortfalls incurred in connection with Principal
Prepayments received in respect of the Mortgage Pool during the most recently
ended Collection Period, and (ii) the total amount of Servicing Fees and
Prepayment Interest Excesses received by the Servicer during such Collection
Period.
(b) No more frequently than once per calendar month, the Special Servicer
may require the Servicer, and the Servicer shall be obligated, out of the
Servicer's own funds, to reimburse the Special Servicer for any Servicing
Advances made by but not previously reimbursed to the Special Servicer, together
with interest thereon at the Reimbursement Rate from the date made to, but not
including, the date of reimbursement. Such reimbursement and any accompanying
payment of interest shall be made within ten (10) days of the request therefor
by wire transfer of immediately available funds to an account designated by the
Special Servicer. Upon the Servicer's reimbursement to the Special Servicer of
any Servicing Advance and payment to the Special Servicer of interest thereon,
all in accordance with this Section 3.19(b), the Servicer shall for all purposes
of this Agreement be deemed to have made such Servicing Advance at the same time
as the Special Servicer actually made such Advance, and accordingly, the
Servicer shall be entitled to reimbursement for such Advance, together with
interest thereon in accordance with Sections 3.05(a) and 3.11(g), at the same
time, in the same manner and to the same extent as the Servicer would otherwise
have been entitled if it had actually made such Servicing Advance at the time
the Special Servicer did.
Notwithstanding anything to the contrary contained in this Agreement, if
the Special Servicer is required under this Agreement to make any Servicing
Advance but does not desire to do so, the Special Servicer may, in its sole
discretion, request that the Servicer make such Advance, such request to be
made, in writing, in a timely manner that does not adversely affect the
interests of any Certificateholder and to be accompanied by such information and
documentation regarding the subject Advance as the Servicer may reasonably
request. The Servicer shall have the obligation to make any such Servicing
Advance that it is so requested by the Special Servicer to make, within ten days
of the Servicer's receipt of such request. The Special Servicer shall be
relieved of any obligations with respect to an Advance that it so requests the
Servicer to make (regardless of whether or not the Servicer shall make such
Advance). The Servicer shall be entitled to reimbursement for any Servicing
Advance made by it at the direction of the Special Servicer, together with
interest thereon in accordance with Sections 3.05(a) and 3.11(g), at the same
time, in the same manner and to the same extent as the Servicer is entitled with
respect to any other Servicing Advance made thereby.
Notwithstanding the foregoing provisions of this Section 3.19(b) , the
Servicer shall not be required to reimburse the Special Servicer for, or to make
at the Special Servicer's direction, any Servicing Advance if the Servicer
determines in its reasonable, good faith judgment that the Servicing Advance for
which the Special Servicer is requesting reimbursement, or which the Special
Servicer is directing the Servicer to make, hereunder, although not
characterized by the Special Servicer as a Nonrecoverable Servicing Advance, is
in fact a Nonrecoverable Servicing Advance. The Servicer shall notify the
Special Servicer in writing of such determination and, if applicable, such
Nonrecoverable Servicing Advance shall be reimbursed to the Special Servicer
pursuant to Section 3.05(a).
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(c) Promptly following the earliest of (i) the date on which any Mortgage
Loan becomes a Modified Mortgage Loan, (ii) the 60th day (or, in the case of a
Modified Mortgage Loan or a Mortgage Loan as to which the related Mortgagor has
been the subject of a bankruptcy, insolvency or similar proceeding since the
Closing Date, the 30th day) following the occurrence of any uncured delinquency
in Monthly Payments with respect to any Mortgage Loan, (iii) the date on which a
receiver is appointed and continues in such capacity in respect of the Mortgaged
Property securing any Mortgage Loan and (iv) the date on which the Mortgaged
Property securing any Mortgage Loan becomes an REO Property (each such Mortgage
Loan, until it ceases to be such in accordance with the following paragraph, a
"Required Appraisal Loan"), the Special Servicer shall obtain an Appraisal of
the related Mortgaged Property, unless an Appraisal thereof had previously been
obtained within the prior twelve months. The cost of such Appraisal shall be
covered by, and be reimbursable as, a Servicing Advance. Based on such
Appraisal, the Special Servicer shall determine and report to the Trustee the
then applicable Appraisal Reduction Amount, if any, with respect to the subject
Required Appraisal Loan.
With respect to each Required Appraisal Loan (unless such Mortgage Loan has
become a Corrected Mortgage Loan and has remained current for twelve consecutive
Monthly Payments, and no other Servicing Transfer Event has occurred with
respect thereto during such twelve-month period, in which case it will cease to
be a Required Appraisal Loan), the Special Servicer shall, within 30 days of
each anniversary of such loan's having become a Required Appraisal Loan, order
an update of the prior Appraisal (the cost of which will be covered by, and be
reimbursable as, a Servicing Advance). Based upon such Appraisal, the Special
Servicer shall redetermine and report to the Trustee the then applicable
Appraisal Reduction Amount, if any, with respect to the subject Required
Appraisal Loan.
(d) The Servicer shall pay, without any right of reimbursement therefor,
the post-Closing Date fees of the Rating Agencies for ongoing surveillance of
the Rated Certificates.
(e) In connection with each prepayment of principal received hereunder, the
Servicer shall calculate any applicable Prepayment Premium or Yield Maintenance
Premium, as the case may be, payable under the terms of the related Mortgage
Note. Upon written request of any Certificateholder, the Servicer shall disclose
to such Certificateholder its calculation of any such Prepayment Premium or
Yield Maintenance Premium.
(f) The Servicer shall not permit defeasance of any Mortgage Loan on or
before the second anniversary of the Closing Date. Subsequent to the second
anniversary of the Closing Date, to the extent that the Servicer can, in
accordance with the related loan documents, require defeasance of any Mortgage
Loan in lieu of accepting a prepayment of principal thereunder, including a
prepayment of principal accompanied by a Prepayment Premium or Yield Maintenance
Premium, the Servicer shall, to the extent it is not inconsistent with the
Servicing Standard, require such defeasance, provided that (i) the defeasance
collateral consists of U.S. Treasury obligations, (ii) the Servicer has
determined that the defeasance will not result in an Adverse REMIC Event in
respect of any REMIC Pool and (iii) the Servicer has requested and received from
the related Mortgagor (A) an Opinion of Counsel generally to the effect that the
Trustee will have a perfected, first priority security interest in such
defeasance collateral and (B) written confirmation from a firm of Independent
accountants stating that payments made on such defeasance collateral in
accordance with the terms thereof will be sufficient to pay the subject Mortgage
Loan in full on or before its Stated Maturity Date (or, in the case of an ARD
Loan, on or before its Anticipated Repayment Date) and to timely pay each
Monthly Payment scheduled to be due prior thereto but after the defeasance. Any
customary and reasonable out-of-pocket expense incurred by the Servicer pursuant
to this Section 3.19(f) shall be paid by
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the Mortgagor of the defeased Mortgage Loan pursuant to the related Mortgage,
Mortgage Note or other pertinent document, if so allowed by the terms of such
documents.
(g) The Servicer shall, as to each Mortgage Loan which is secured by the
interest of the related Mortgagor under a ground lease, promptly (and in any
event within 45 days of the Closing Date) notify the related ground lessor of
the transfer of such Mortgage Loan to the Trust pursuant to this Agreement and
inform such ground lessor that any notices of default under the related ground
lease should thereafter be forwarded to the Servicer.
SECTION 3.20. Modifications, Waivers, Amendments and Consents.
(a) The Special Servicer and, to the limited extent permitted below, the
Servicer each may (consistent with the Servicing Standard) agree to any
modification, waiver or amendment of any term of, extend the maturity of,
forgive interest (including Default Interest and Additional Interest) on and
principal of, forgive late payment charges, Prepayment Premiums and Yield
Maintenance Premiums on, defer the payment of interest on, permit the release,
addition or substitution of collateral securing, and/or permit the release,
addition or substitution of the Mortgagor on or any guarantor of, any Mortgage
Loan it is required to service and administer hereunder, subject, however, to
Section 3.24 and, further, to each of the following limitations, conditions and
restrictions:
(i) other than as provided in Sections 2.03(a) and 3.02, the Servicer
shall not agree to any modification, waiver or amendment of any term of, or
take any of the other acts referenced in this Section 3.20(a) with respect
to, any Mortgage Loan without the consent of the Special Servicer (it being
understood and agreed that (A) the Servicer shall promptly provide the
Special Servicer with all information that the Special Servicer may
reasonably request in order to withhold or grant any such consent, (B) the
Special Servicer shall not unreasonably withhold any such consent, (C) the
Special Servicer shall decide whether to withhold or grant such consent in
accordance with the Servicing Standard and (D) if any such consent has not
been expressly denied within 10 Business Days of the Special Servicer's
receipt from the Servicer of all information reasonably requested thereby
in order to make an informed decision, such consent shall be deemed to have
been granted);
(ii) other than as provided in Sections 3.02 and 3.08, the Special
Servicer shall not agree to (or consent to the Servicer's agreeing to) any
modification, waiver or amendment of any term of, or take (or consent to
the Servicer's taking) any of the other acts referenced in this Section
3.20(a) with respect to, any Mortgage Loan that would affect the amount or
timing of any related payment of principal, interest or other amount
payable thereunder or, in the Special Servicer's reasonable, good faith
judgment, would materially impair the security for such Mortgage Loan or
reduce the likelihood of timely payment of amounts due thereon, unless a
material default on such Mortgage Loan has occurred or, in the Special
Servicer's reasonable, good faith judgment, a default in respect of payment
on such Mortgage Loan is reasonably foreseeable, and such modification,
waiver, amendment or other action is reasonably likely to produce a greater
recovery to Certificateholders on a present value basis (the relevant
discounting of anticipated collections that will be distributable to
Certificateholders to be done at the related Net Mortgage Rate), than would
liquidation;
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(iii) the Special Servicer shall not extend (or consent to the
Servicer's extending) the date on which any Balloon Payment is scheduled to
be due on any Specially Serviced Mortgage Loan to a date beyond the
earliest of (A) the third anniversary of such Mortgage Loan's Stated
Maturity Date, (B) two years prior to the Rated Final Distribution Date and
(C) if such Mortgage Loan is secured by a Mortgage solely or primarily on
the related Mortgagor's leasehold interest in the related Mortgaged
Property, ten years prior to the end of the then current term of the
related Ground Lease; and, furthermore, the Special Servicer shall not
grant (or consent to the Servicer's granting) any such extension unless (A)
the Special Servicer's recovery determination contemplated by clause (ii)
above is supported by an Appraisal performed within the preceding 12-month
period and (B) the Mortgagor agrees to deliver to the Special Servicer, the
Trustee, the Controlling Class Representative and, if not already included
among the foregoing, any Majority Certificateholder of the Controlling
Class, quarterly operating statements with respect to the related Mortgaged
Property (the Special Servicer (or, if applicable, the Servicer at the
direction of the Special Servicer) to request that such statements be
audited, provided that the Special Servicer may waive such condition
relating to such statements being audited, in its sole discretion);
(iv) neither the Servicer nor the Special Servicer shall make or
permit any modification, waiver or amendment of any term of, or take any of
the other acts referenced in this Section 3.20(a) with respect to, any
Mortgage Loan that would result in an Adverse REMIC Event with respect to
any REMIC Pool;
(v) the Special Servicer shall not permit (or consent to the
Servicer's permitting) any Mortgagor to add or substitute any collateral
for its Mortgage Loan unless the Special Servicer shall have first (A)
determined in its reasonable, good faith judgment, based upon a Phase I
Environmental Assessment (and any additional environmental testing that the
Special Servicer deems necessary and prudent) conducted by an Independent
Person who regularly conducts Phase I Environmental Assessments, at the
expense of the Mortgagor, that such additional or substitute collateral is
in compliance with applicable environmental laws and regulations and that
there are no circumstances or conditions present with respect to such new
collateral relating to the use, management or disposal of any Hazardous
Materials for which investigation, testing, monitoring, containment,
clean-up or remediation would be required under any then applicable
environmental laws and/or regulations and (B) received confirmation from
each Rating Agency that such addition or substitution of collateral will
not result in an Adverse Rating Event with respect to any Class of Rated
Certificates; and
(vi) the Special Servicer shall not release (or not consent to the
Servicer's releasing), including in connection with a substitution
contemplated by clause (v) above, any collateral securing an outstanding
Mortgage Loan except as provided in Section 3.09(d), except where a
Mortgage Loan (or, in the case of a Cross-Collateralized Group, where such
entire Cross-Collateralized Group) is satisfied and except in the case of a
release where (A) either (1) the use of the collateral to be released will
not, in the Special Servicer's good faith and reasonable judgment,
materially and adversely affect the Net Operating Income being generated by
or the use of the related Mortgaged Property, or (2) there is a
corresponding principal paydown of such Mortgage Loan in an amount at least
equal to the appraised value of the collateral to be released (or
substitute collateral with an appraised value at least equal to that of the
collateral to be released, is delivered), (B) the remaining Mortgaged
Property
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(together with any substitute collateral) is, in the Special Servicer's
good faith and reasonable judgment, adequate security for the remaining
Mortgage Loan and (C) such release would not, in and of itself, result in
an Adverse Rating Event with respect to any Class of Rated Certificates (as
confirmed in writing to the Trustee by each Rating Agency);
provided that (x) the limitations, conditions and restrictions set forth in
clauses (i) through (vi) above shall not apply to any of the acts referenced in
this Section 3.20(a) with respect to any Mortgage Loan that is required under
the terms of such Mortgage Loan in effect on the Closing Date (or, in the case
of a Replacement Mortgage Loan, on the related date of substitution) or that is
solely within the control of the related Mortgagor, and (y) notwithstanding
clauses (i) through (vi) above, neither the Servicer nor the Special Servicer
shall be required to oppose the confirmation of a plan in any bankruptcy or
similar proceeding involving a Mortgagor if in its reasonable, good faith
judgment such opposition would not ultimately prevent the confirmation of such
plan or one substantially similar.
(b) The Special Servicer shall have no liability to the Trust, the
Certificateholders or any other Person if the Special Servicer's analysis and
determination that the modification, waiver, amendment or other action
contemplated by Section 3.20(a) is reasonably likely to produce a greater
recovery to Certificateholders on a present value basis than would liquidation,
should prove to be wrong or incorrect, so long as the analysis and determination
were made on a reasonable basis in good faith by the Special Servicer and in
accordance with the Servicing Standard.
(c) Any payment of interest, which is deferred pursuant to Section 3.20(a),
shall not, for purposes hereof, including calculating monthly distributions to
Certificateholders, be added to the unpaid principal balance or Stated Principal
Balance of the related Mortgage Loan, notwithstanding that the terms of such
Mortgage Loan so permit or that such interest may actually be capitalized.
(d) Each of the Servicer and the Special Servicer may, as a condition to
its granting any request by a Mortgagor for consent, modification, waiver or
indulgence or any other matter or thing, the granting of which is within the
Servicer's or the Special Servicer's, as the case may be, discretion pursuant to
the terms of the instruments evidencing or securing the related Mortgage Loan
and is permitted by the terms of this Agreement, require that such Mortgagor pay
to it a reasonable or customary fee (which shall in no event exceed 1.0% of the
unpaid principal balance of the related Mortgage Loan) for the additional
services performed in connection with such request, together with any related
costs and expenses incurred by it. All such fees collected by the Servicer
and/or the Special Servicer shall be allocable between such parties, as
Additional Servicing Compensation and Additional Special Servicing Compensation,
respectively, as provided in Section 3.11.
(e) All modifications, waivers, amendments and other actions entered into
or taken in respect of the Mortgage Loans pursuant to this Section 3.20 shall be
in writing. Each of the Special Servicer and the Servicer shall notify the other
such party and the Trustee, in writing, of any modification, waiver, amendment
or other action entered into or taken thereby in respect of any Mortgage Loan
pursuant to this Section 3.20 and the date thereof, and shall deliver to the
Trustee or the related Custodian for deposit in the related Mortgage File (with
a copy to the other such party, an original counterpart of the agreement
relating to such modification, waiver, amendment or other action, promptly (and
in any event within 10 Business Days) following the execution thereof. In
addition, following the execution of any modification, waiver or amendment
agreed to by the Special Servicer pursuant to Section 3.20(a) above, the Special
Servicer shall deliver to the Servicer, the Trustee and the Rating Agencies an
Officer's Certificate certifying that all of the
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requirements of Section 3.20(a) have been met and setting forth in reasonable
detail the basis of the determination made by it pursuant to Section
3.20(a)(ii); provided that, if such modification, waiver or amendment involves
an extension of the maturity of any Mortgage Loan, such Officer's Certificate
shall be delivered to the Servicer, the Trustee and the Rating Agencies before
the modification, waiver or amendment is agreed to.
(f) With respect to any ARD Loan after its Anticipated Repayment Date, the
Servicer shall be permitted, in its discretion, to waive (such waiver to be in
writing addressed to the related Mortgagor, with a copy to the Trustee) all or
any portion of accrued Additional Interest if, prior to the related maturity
date, the related Mortgagor has requested the right to prepay the Mortgage Loan
in full together with all payments required by the Mortgage Loan in connection
with such prepayment except for all or a portion of accrued Additional Interest,
provided that the Servicer's determination to waive the right to such accrued
Additional Interest is reasonably likely to produce a greater payment to
Certificateholders on a present value basis (the relevant discounting of
anticipated collections that will be distributable to Certificateholders to be
performed at the related Net Mortgage Rate) than a refusal to waive the right to
such Additional Interest. The Servicer will have no liability to the Trust, the
Certificateholders or any other person so long as such determination is based on
such criteria.
SECTION 3.21. Transfer of Servicing Between Servicer and Special Servicer;
Record Keeping.
(a) Upon determining that a Servicing Transfer Event has occurred with
respect to any Mortgage Loan and if the Servicer is not also the Special
Servicer, the Servicer shall immediately give notice thereof, and shall deliver
the related Servicing File, to the Special Servicer and shall use its best
efforts to provide the Special Servicer with all information, documents (or
copies thereof) and records (including records stored electronically on computer
tapes, magnetic discs and the like) relating to the Mortgage Loan and reasonably
requested by the Special Servicer to enable it to assume its functions hereunder
with respect thereto without acting through a Sub-Servicer. To the extent such
is in the possession of the Servicer or any Sub-Servicer thereof, the
information, documents and records to be delivered by the Servicer to the
Special Servicer pursuant to the prior sentence shall include, but not be
limited to, financial statements, appraisals, environmental/engineering reports,
leases, rent rolls, title insurance policies, UCC's and tenant estoppels. The
Servicer shall use its best efforts to comply with the preceding sentence within
five Business Days of the occurrence of each related Servicing Transfer Event.
The Special Servicer may, as to any delinquent Mortgage Loan, prior to the
occurrence of a Servicing Transfer Event with respect thereto, request and
obtain the foregoing documents and information in order to perform its duties
described in Section 3.02.
Upon determining that a Specially Serviced Mortgage Loan has become a
Corrected Mortgage Loan and if the Servicer is not also the Special Servicer,
the Special Servicer shall immediately give notice thereof, and shall return the
related Servicing File within five Business Days, to the Servicer; and, upon
giving such notice and returning such Servicing File to the Servicer, the
Special Servicer's obligation to service such Mortgage Loan, and the Special
Servicer's right to receive the Special Servicing Fee with respect to such
Mortgage Loan, shall terminate, and the obligations of the Servicer to service
and administer such Mortgage Loan shall resume.
Notwithstanding anything herein to the contrary, in connection with the
transfer to the Special Servicer of the servicing of a Cross-Collateralized
Mortgage Loan as a result of a Servicing Transfer Event or the re-assumption of
servicing responsibilities by the Servicer with respect to any such Mortgage
Loan
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upon its becoming a Corrected Mortgage Loan, the Servicer and the Special
Servicer shall each transfer to the other, as and when applicable, the servicing
of all other Cross-Collateralized Mortgage Loans constituting part of the same
Cross-Collateralized Group; provided that no Cross-Collateralized Mortgage Loan
may become a Corrected Mortgage Loan at anytime that a continuing Servicing
Transfer Event exists with respect to another Cross-Collateralized Mortgage Loan
in the same Cross-Collateralized Group.
(b) In servicing any Specially Serviced Mortgage Loans, the Special
Servicer shall provide to the Trustee originals of documents contemplated by the
definition of "Mortgage File" and generated while such Mortgage Loan is a
Specially Serviced Mortgage Loan, for inclusion in the related Mortgage File
(with a copy of each such original to the Servicer), and copies of any
additional related Mortgage Loan information, including correspondence with the
related Mortgagor generated while such Mortgage Loan is a Specially Serviced
Mortgage Loan.
(c) The Servicer and Special Servicer shall each furnish to the other, upon
reasonable request, such reports, documents, certifications and information in
its possession, and access to such books and records maintained thereby, as may
relate to the Mortgage Loans and any REO Properties and as shall be reasonably
required by the requesting party in order to perform its duties hereunder.
(d) In connection with the performance of its obligations hereunder, each
of the Servicer and the Special Servicer shall be entitled to rely upon written
information provided to it by the other.
SECTION 3.22. Sub-Servicing Agreements.
(a) The Servicer and the Special Servicer may enter into Sub-Servicing
Agreements to provide for the performance by third parties of any or all of
their respective obligations hereunder, provided that, in each case, the
Sub-Servicing Agreement: (i) insofar as it affects the Trust, is consistent with
this Agreement in all material respects and requires the Sub-Servicer to comply
with all of the applicable conditions of this Agreement; (ii) provides that if
the Servicer or the Special Servicer, as the case may be, shall for any reason
no longer act in such capacity hereunder (including by reason of an Event of
Default), the Trustee or its designee or any other successor to the Servicer or
the Special Servicer, as the case may be, may thereupon assume all of the rights
and, except to the extent they arose prior to the date of assumption,
obligations of the Servicer or the Special Servicer, as the case may be, under
such agreement or, alternatively, may terminate such Sub-Servicing Agreement
without cause and without payment of any penalty or termination fee; (iii)
provides that the Trustee, for the benefit of the Certificateholders, shall be a
third party beneficiary under such agreement, but that (except to the extent the
Trustee or its designee assumes the obligations of the Servicer or the Special
Servicer, as the case may be, thereunder as contemplated by the immediately
preceding clause (ii)) none of the Trustee, any successor Servicer or Special
Servicer, as the case may be, or any Certificateholder shall have any duties
under such agreement or any liabilities arising therefrom; (iv) permits any
purchaser of a Mortgage Loan pursuant to this Agreement to terminate such
agreement with respect to such purchased Mortgage Loan at its option and without
penalty; (v) does not permit the Sub-Servicer to enter into or consent to any
modification, waiver or amendment or otherwise take any action on behalf of the
Servicer or Special Servicer, as the case may be, contemplated by Section 3.20
hereof without the consent of the Servicer or Special Servicer, as the case may
be; and (vi) does not permit the Sub-Servicer any greater rights of
indemnification out of the Trust Fund that the Servicer or the Special Servicer,
as the case may be, have pursuant to Section 6.03; provided that the appointment
by the Servicer or Special Servicer of a third-party contractor for the purpose
of performing discrete, ministerial functions shall not be subject to this
Section 3.22 (except that the Servicer or the Special Servicer, as the case may
be,
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shall remain responsible for the actions of such third-party contractors and
shall pay all fees and expenses of such third-party contractors, unless
otherwise expressly provided herein). In addition, each Sub-Servicing Agreement
entered into by the Servicer shall provide that such agreement shall, with
respect to any Mortgage Loan serviced thereunder, terminate at the time such
Mortgage Loan becomes a Specially Serviced Mortgage Loan (or, alternatively, be
suspended for so long as such Mortgage Loan continues to be a Specially Serviced
Mortgage Loan), and each Sub-Servicing Agreement entered into by the Special
Servicer shall relate only to Specially Serviced Mortgage Loans and shall
terminate with respect to any such Mortgage Loan which ceases to be a Specially
Serviced Mortgage Loan. The Servicer and the Special Servicer shall each notify
the other, the Trustee and the Depositor in writing promptly of the appointment
by it of any Sub-Servicer. The Servicer and the Special Servicer shall each
deliver to the Trustee copies of all Sub-Servicing Agreements, and any
amendments thereto and modifications thereof, entered into by it promptly upon
its execution and delivery of such documents. References in this Agreement to
actions taken or to be taken by the Servicer or the Special Servicer include
actions taken or to be taken by a Sub-Servicer on behalf of the Servicer or the
Special Servicer, as the case may be; and, in connection therewith, all amounts
advanced by any Sub-Servicer to satisfy the obligations of the Servicer or the
Special Servicer hereunder to make Advances shall be deemed to have been
advanced by the Servicer or the Special Servicer, as the case may be, out of its
own funds and, accordingly, such Advances shall be recoverable by such
Sub-Servicer in the same manner and out of the same funds as if such
Sub-Servicer were the Servicer or the Special Servicer, as the case may be. Such
Advances shall accrue interest in accordance with Sections 3.11(g) and/or
4.03(e), such interest to be allocable between the Servicer or the Special
Servicer, as the case may be, and such Sub-Servicer as they may agree. For
purposes of this Agreement, the Servicer and the Special Servicer shall each be
deemed to have received any payment when a Sub-Servicer retained by it receives
such payment.
(b) Each Sub-Servicer shall be authorized to transact business in the state
or states in which the related Mortgaged Properties it is to service are
situated, if and to the extent required by applicable law.
(c) The Servicer and the Special Servicer, for the benefit of the Trustee
and the Certificateholders, shall (at no expense to the other such party or to
the Trustee, the Certificateholders or the Trust) monitor the performance and
enforce the obligations of their respective Sub-Servicers under the related
Sub-Servicing Agreements. Such enforcement, including the legal prosecution of
claims, termination of Sub-Servicing Agreements in accordance with their
respective terms 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 or the
Special Servicer, as applicable, in its good faith and reasonable judgment,
would require were it the owner of the Mortgage Loans. Subject to the terms of
the related Sub-Servicing Agreement, the Servicer and the Special Servicer shall
each have the right to remove a Sub-Servicer retained by it at any time it
considers such removal to be in the best interests of Certificateholders.
(d) If the Servicer or the Special Servicer ceases to serve as such under
this Agreement for any reason (including by reason of an Event of Default) and
no successor Servicer or Special Servicer, as the case may be, has succeeded to
its rights and assumed its obligations hereunder or, in the case of the Special
Servicer, no replacement Special Servicer has been designated pursuant to
Section 6.06, then the Trustee or its designee shall succeed to the rights and
assume the obligations of the Servicer or the Special Servicer under any
Sub-Servicing Agreement, unless the Trustee elects to terminate any such
Sub-Servicing Agreement in accordance with its terms and Section 3.22(a)(ii)
hereof. In any event, if a Sub-Servicing Agreement is to be assumed by the
Trustee or another successor thereto, then the Servicer or the Special Servicer,
as applicable, at its expense shall, upon request of the Trustee, deliver to the
assuming party all
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documents and records relating to such Sub-Servicing Agreement and the Mortgage
Loans then being serviced thereunder and an accounting of amounts collected and
held on behalf of it thereunder, and otherwise use its best efforts to effect
the orderly and efficient transfer of the Sub-Servicing Agreement to the
assuming party.
(e) Notwithstanding any Sub-Servicing Agreement, the Servicer and the
Special Servicer shall remain obligated and liable to the Trustee and the
Certificateholders for the performance of their respective obligations and
duties under this Agreement in accordance with the provisions hereof to the same
extent and under the same terms and conditions as if each alone were servicing
and administering the Mortgage Loans or REO Properties for which it is
responsible. No appointment of a Sub-Servicer shall result in any additional
expense to the Trustee, the Certificateholders or the Trust.
SECTION 3.23. Controlling Class Representative.
(a) The Holders (or, in the case of Book-Entry Certificates, the
Certificate Owners) of Certificates representing more than 50% (by aggregate
Certificate Principal Balance) of the Controlling Class shall be entitled in
accordance with this Section 3.23 to select a representative (the "Controlling
Class Representative") having the rights and powers specified in this Agreement
(including Sections 3.09, 3.18 and 3.24) or to replace an existing Controlling
Class Representative. Upon (i) the receipt by the Trustee of written requests
for the selection of a Controlling Class Representative from the Holders (or, in
the case of Book-Entry Certificates, the Certificate Owners) of Certificates
representing more than 50% (by aggregate Certificate Principal Balance) of the
Controlling Class, (ii) the resignation or removal of the Person acting as
Controlling Class Representative or (iii) a determination by the Trustee that
the Controlling Class has changed, the Trustee shall promptly notify the Holders
(and, in the case of Book-Entry Certificates, to the extent actually known to a
Responsible Officer of the Trustee or identified thereto by the Depository or
the Depository Participants, the Certificate Owners) of the Controlling Class
that they may select a Controlling Class Representative. Such notice shall set
forth the process established by the Trustee in order to select a Controlling
Class Representative, which process may include the designation of the
Controlling Class Representative by the Majority Certificateholder of the
Controlling Class in a writing delivered to the Trustee. No appointment of any
Person as a Controlling Class Representative shall be effective until such
Person provides the Trustee with written confirmation of its acceptance of such
appointment, an address and telecopy number for the delivery of notices and
other correspondence and a list of officers or employees of such Person with
whom the parties to this Agreement may deal (including their names, titles, work
addresses and telecopy numbers).
(b) Within 10 Business Days (or as soon thereafter as practicable if the
Controlling Class consists of Book-Entry Certificates) of receiving a request
therefor from the Servicer or Special Servicer, the Trustee shall deliver to the
requesting party the identity of the Controlling Class Representative and a list
of each Holder (or, in the case of Book-Entry Certificates, to the extent
actually known to a Responsible Officer of the Trustee or identified thereto by
the Depository or the Depository Participants, each Certificate Owner) of the
Controlling Class, including, in each case, names and addresses. With respect to
such information, the Trustee shall be entitled to conclusively rely on
information provided to it by the Holders (or, in the case of Book-Entry
Certificates, subject to Section 5.06, by the Depository or the Certificate
Owners) of such Certificates, and the Servicer and the Special Servicer shall be
entitled to rely on such information provided by the Trustee with respect to any
obligation or right hereunder that the Servicer and the Special Servicer may
have to deliver information or otherwise communicate with the Controlling Class
Representative or any of the Holders (or, if applicable, Certificate Owners) of
the Controlling Class. In
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addition to the foregoing, within two Business Days of the selection,
resignation or removal of a Controlling Class Representative, the Trustee shall
notify the other parties to this Agreement of such event. The expenses incurred
by the Trustee in connection with obtaining information from the Depository or
Depository Participants with respect to any Book-Entry Certificate shall be
expenses of the Trust payable out of the Collection Account pursuant to Section
3.05(a).
(c) A Controlling Class Representative may at any time resign as such by
giving written notice to the Trustee and to each Holder (or, in the case of
Book-Entry Certificates, Certificate Owner) of the Controlling Class. The
Holders (or, in the case of Book-Entry Certificates, the Certificate Owners) of
Certificates representing more than 50% (by aggregate Certificate Principal
Balance) of the Controlling Class shall be entitled to remove any existing
Controlling Class Representative by giving written notice to the Trustee and to
each other Holder (or, in the case of Book-Entry Certificates, Certificate
Owner) of the Controlling Class.
(d) Once a Controlling Class Representative has been selected pursuant to
this Section 3.23, each of the parties to this Agreement and each
Certificateholder (or Certificate Owner, if applicable) shall be entitled to
rely on such selection unless a majority of the Holders (or, in the case of
Book-Entry Certificates, the Certificate Owners) of the Controlling Class, by
aggregate Certificate Principal Balance, or such Controlling Class
Representative, as applicable, shall have notified the Trustee and each other
Holder (or, in the case of Book-Entry Certificates, Certificate Owner) of the
Controlling Class, in writing, of the resignation or removal of such Controlling
Class Representative.
(e) Any and all expenses of the Controlling Class Representative shall be
borne by the Holders (or, if applicable, Certificate Owners) of Certificates of
the Controlling Class, pro rata according to their respective Percentage
Interests in such Class, and not by the Trust. Notwithstanding the foregoing, if
a claim is made against the Controlling Class Representative by a Mortgagor with
respect to this Agreement or any particular Mortgage Loan, the Controlling Class
Representative shall immediately notify the Trustee, the Servicer and the
Special Servicer, whereupon (if the Special Servicer or the Trust are also named
parties to the same action and, in the sole judgment of the Special Servicer,
the Controlling Class Representative had with regard to the particular matter
acted in good faith, without gross negligence or willful misconduct, and there
is no potential for the Special Servicer or the Trust to be an adverse party in
such action as regards the Controlling Class Representative) the Special
Servicer on behalf of the Trust shall, subject to Section 6.03, assume the
defense of any such claim against the Controlling Class Representative. This
provision shall survive the termination of this Agreement and the termination or
resignation of the Controlling Class Representative.
(f) The Controlling Class Representative shall have no liability to the
Trust or the Holders for any action taken, or for refraining from the taking of
any action, in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Controlling Class
Representative against any liability which would otherwise be imposed by reason
of its gross negligence, willful misconduct or reckless disregard of its
obligations and duties hereunder. By its acceptance of a Certificate or interest
therein, each Holder and Certificate Owner confirms its understanding that the
Controlling Class Representative may take actions that favor the interests of
one or more Classes over other Classes and that the Controlling Class
Representative may have interests that conflict with those of the Holders of
some Classes; and, absent gross negligence, willful misconduct or reckless
disregard on the part of the Controlling Class Representative in the performance
of its obligations and duties hereunder or a breach on the part of the
Controlling Class Representative of any of its representations, warranties or
covenants set
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forth herein (which breach has a material adverse effect on the Trust), each
Holder and Certificate Owner agrees to take no action against the Controlling
Class Representative.
SECTION 3.24. Certain Rights and Powers of the Controlling Class
Representative.
(a) Within 60 days after the occurrence of a Servicing Transfer Event with
respect to any Mortgage Loan and the transfer of servicing with respect to such
Mortgage Loan to the Special Servicer (or, if applicable, within 60 days after
the commencement of the administration of any REO Property by the Special
Servicer), or such longer period as the Controlling Class Representative shall
approve (which approval shall not be unreasonably withheld), the Special
Servicer shall prepare or cause to be prepared and delivered to the Controlling
Class Representative and the Trustee a summary business plan (as to such
Mortgage Loan or REO Property, a "Summary Business Plan") outlining the strategy
which the Special Servicer contemplates using in resolving the event giving rise
to such Servicing Transfer Event or in liquidating or otherwise disposing of
such Mortgage Loan (or REO Property). If within ten Business Days of receiving
the Summary Business Plan (whether in its original form or, as contemplated
below, any revised form), the Controlling Class Representative does not
disapprove such Summary Business Plan in writing, the Special Servicer shall
implement the recommended action as outlined in such Summary Business Plan. If
the Controlling Class Representative disapproves such Summary Business Plan, the
Special Servicer shall, subject to Section 3.24(d), revise such plan in response
to the recommendations of the Controlling Class Representative and deliver to
the Trustee and the Controlling Class Representative a new Summary Business Plan
as soon as practicable. Subject to Section 3.24(d), the Special Servicer shall,
for a period not to exceed 30 days following its delivery to the Trustee and
Controlling Class Representative of the initial version of such Summary Business
Plan, continue to so revise such Summary Business Plan until the Controlling
Class Representative either affirmatively approves, or within a period of ten
Business Days following its receipt thereof, fails to disapprove, in writing,
any particular form of such Summary Business Plan delivered to it (whereupon the
Special Servicer shall implement the recommended action as outlined in such
particular form of Summary Business Plan). If no form of Summary Business Plan
is adopted in respect of any particular Specially Serviced Mortgage Loan or REO
Property in accordance with the foregoing provisions of this Section 3.24(a)
within 30 days following the Special Servicer's delivery to the Trustee and the
Controlling Class Representative of the initial version of such Summary Business
Plan, or if the Special Servicer determines in its reasonable, good faith
judgment that the Controlling Class Representative's disapproval of any
particular form of Summary Business Plan is not in the best interests of the
Certificateholders (as a collective whole) (as evidenced by an Officer's
Certificate to such effect, which specifies the basis for such determination,
delivered to the Trustee and the Controlling Class Representative), then the
Special Servicer shall implement the recommended action as outlined in the form
of Summary Business Plan most recently delivered to the Controlling Class
Representative as of such 30th day or the date of such determination, as the
case may be. The particular form of Summary Business Plan for any Specially
Serviced Mortgage Loan or REO Property, as adopted in accordance with this
Section 3.24(a), shall constitute an "Approved Summary Business Plan" with
respect thereto. Notwithstanding the foregoing, at any time prior to there being
an Approved Summary Business Plan in respect of any Specially Serviced Mortgage
Loan or REO Property, the Special Servicer may, subject to the other subsections
of this Section 3.24, take any action in respect of such Mortgage Loan or REO
Property that is consistent with the Servicing Standard, provided that its
failure to do so would, in its good faith, reasonable judgment, irreparably harm
any Certificateholder and it has made a reasonable effort to notify the
Controlling Class Representative of its intention to take such action. All
Summary Business Plans submitted by the Special Servicer to the Trustee and the
Controlling Class Representative must be consistent with the terms of this
Agreement, including the Servicing Standard. If the Special Servicer is at any
time required to prepare a Summary Business Plan in respect of the Showboat
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Loan or Showboat Property, it shall retain a casino industry expert to assist it
(the cost of such expert to be covered by, and reimbursable as, a Servicing
Advance).
(b) Prior to the Special Servicer's taking any of the following actions,
the Special Servicer shall notify the Controlling Class Representative and the
Trustee of its intention to take such action and shall supply the Controlling
Class Representative with such information as the Controlling Class
Representative may reasonably request to allow the Controlling Class
Representative to make an informed decision. Subject to Section 3.24(d), the
Special Servicer shall not take any of the following actions as to which the
Controlling Class Representative shall have objected in writing within ten days
of its receiving from the Special Servicer written notice thereof and sufficient
information to make an informed decision (it being understood and agreed that if
such written objection has not been received by the Special Servicer within such
ten-day period, then the Controlling Class Representative's approval shall be
deemed to have been given):
(i) deviate in any material respect from the Approved Summary Business
Plan for any Specially Serviced Mortgage Loan or REO Property (any material
deviation from any Approved Summary Business Plan permitted pursuant to
this Section 3.24(b) and Section 3.24(d) being deemed an approved
modification thereto);
(ii) unless it is part of the governing Approved Summary Business Plan
or in connection with a termination of the Trust pursuant to Section 9.01,
sell any Defaulted Mortgage Loan or REO Property for less than the
applicable Purchase Price;
(iii) unless it is part of the governing Approved Business Plan,
obtain title to any Mortgaged Property by foreclosure, deed in lieu of
foreclosure or otherwise, or take any other action with respect to any
Mortgaged Property as a result of which the Trustee, on behalf of the
Certificateholders, could, in the reasonable, good faith judgment of the
Special Servicer, exercised in accordance with the Servicing Standard, be
considered to hold title to, to be a "mortgagee-in-possession" of, or to be
an "owner" or "operator" of such Mortgaged Property within the meaning of
CERCLA or any comparable law, if the Special Servicer has previously
determined in accordance with the Servicing Standard, based on a Phase I
Environmental Assessment (and any additional environmental testing that the
Special Servicer deems necessary and prudent) of such Mortgaged Property
conducted by an Independent Person who regularly conducts Phase I
Environmental Assessments and performed during the twelve-month period
preceding any such acquisition of title or other action, that (A) the
Mortgaged Property is not in compliance with applicable environmental laws
and regulations, or (B) there are circumstances or conditions present at
the Mortgaged Property relating to the use, management or disposal of
Hazardous Materials for which investigation, testing, monitoring,
containment, clean-up or remediation could be required under any applicable
environmental laws and regulations; or
(iv) unless it is part of the governing Approved Business Plan,
release any Mortgaged Property from the lien of a related Mortgage other
than in accordance with the provisions of the related Mortgage Loan
documents.
(c) Notwithstanding anything to the contrary herein, the Special Servicer
shall not have any right or obligation to consult with or to seek and/or obtain
consent or approval from any Controlling Class Representative prior to acting,
and provisions of this Agreement requiring such shall be of no effect,
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during the period prior to the initial selection of a Controlling Class
Representative and, if any Controlling Class Representative resigns or is
removed, during the period following such resignation or removal until a
replacement is selected.
(d) No recommendation with respect to a Summary Business Plan and no
direction, objection or withholding of a required consent or approval by, of or
on the part of the Controlling Class Representative shall (and the Special
Servicer shall act without regard to any such act or omission by, of or on the
part of the Controlling Class Representative that would): (i) require or cause
the Special Servicer to violate the terms of any Mortgage Loan, applicable law
or any provision of this Agreement (without regard to this Section 3.24),
including the Special Servicer's obligation to act in accordance with the
Servicing Standard; or (ii) result in an Adverse REMIC Event with respect to any
REMIC Pool; or (iii) expose the Depositor, the Servicer, the Special Servicer,
any Fiscal Agent, the REMIC Administrator or the Trustee, or their respective
Affiliates, officers, directors, employees, agents or partners, or the Trust to
any material claim, suit or liability; or (iv) materially expand the scope of
the Special Servicer's responsibilities under this Agreement.
(e) Any and all reports prepared in connection with the environmental
testing referred to in clause (iii) of Section 3.24(b) shall be provided by the
Special Servicer to the Controlling Class Representative, the Servicer and the
Trustee.
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ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions.
(a) On each Distribution Date, the Trustee shall apply amounts on deposit
in the Distribution Account for the following purposes and in the following
order of priority, in each case to the extent of the remaining portion of the
Available Distribution Amount for such Distribution Date:
(i) to make distributions of interest to the Holders of the respective
Classes of Senior Certificates, pro rata based on entitlement, up to
an amount equal to all Distributable Certificate Interest in respect
of each such Class of Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(ii) to make distributions of principal to the Holders of the Class A-1A
and Class A-1B Certificates, allocable as between such Classes of
Certificateholders as provided below, up to an amount equal to the
lesser of (A) the aggregate of the then outstanding Class Principal
Balances of the Class A-1A and Class A-1B Certificates and (B) the
Principal Distribution Amount for such Distribution Date;
(iii) to reimburse the Holders of the Class A-1A and Class A-1B
Certificates, pro rata based on entitlement, up to an amount equal to
all Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to each such Class of Certificates and for which
no reimbursement has previously been received;
(iv) to make distributions of interest to the Holders of the Class A-2
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(v) after the Class Principal Balances of the Class A-1A and Class A-1B
Certificates have been reduced to zero, to make distributions of
principal to the Holders of the Class A-2 Certificates, up to an
amount equal to the lesser of (A) the then outstanding Class Principal
Balance of the Class A-2 Certificates and (B) the excess, if any, of
the Principal Distribution Amount for such Distribution Date over the
amounts, if any, distributed on such Distribution Date pursuant to
clause (ii) above;
(vi) to reimburse the Holders of the Class A-2 Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
(vii) to make distributions of interest to the Holders of the Class A-3
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
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(viii) after the Class Principal Balances of the Class A-1A, Class A-1B and
Class A-2 Certificates have been reduced to zero, to make
distributions of principal to the Holders of the Class A-3
Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of the Class A-3 Certificates and
(B) the excess, if any, of the Principal Distribution Amount for such
Distribution Date over the amounts, if any, distributed on such
Distribution Date pursuant to clauses (ii) and (v) above;
(ix) to reimburse the Holders of the Class A-3 Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
(x) to make distributions of interest to the Holders of the Class B-1
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xi) after the Class Principal Balances of the Class A Certificates have
been reduced to zero, to make distributions of principal to the
Holders of the Class B-1 Certificates, up to an amount equal to the
lesser of (A) the then outstanding Class Principal Balance of the
Class B-1 Certificates and (B) the excess, if any, of the Principal
Distribution Amount for such Distribution Date over the amounts, if
any, distributed on such Distribution Date pursuant to clauses (ii),
(v) and (viii) above;
(xii) to reimburse the Holders of the Class B-1 Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
(xiii) to make distributions of interest to the Holders of the Class B-2
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xiv) after the Class Principal Balances of the Class A and Class B-1
Certificates have been reduced to zero, to make distributions of
principal to the Holders of the Class B-2 Certificates, up to an
amount equal to the lesser of (A) the then outstanding Class Principal
Balance of the Class B-2 Certificates and (B) the excess, if any, of
the Principal Distribution Amount for such Distribution Date over the
amounts, if any, distributed on such Distribution Date pursuant to
clauses (ii), (v), (viii) and (xi) above;
(xv) to reimburse the Holders of the Class B-2 Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
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(xvi) to make distributions of interest to the Holders of the Class B-3
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xvii) after the Class Principal Balances of the Class A, Class B-1 and
Class B-2 Certificates have been reduced to zero, to make
distributions of principal to the Holders of the Class B-3
Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of the Class B-3 Certificates and
(B) the excess, if any, of the Principal Distribution Amount for such
Distribution Date over the amounts, if any, distributed on such
Distribution Date pursuant to clauses (ii), (v), (viii), (xi) and
(xiv) above;
(xviii) to reimburse the Holders of the Class B-3 Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
(xix) to make distributions of interest to the Holders of the Class B-4
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xx) after the Class Principal Balances of the Class A, Class B-1, Class
B-2 and Class B-3 Certificates have been reduced to zero, to make
distributions of principal to the Holders of the Class B-4
Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of the Class B-4 Certificates and
(B) the excess, if any, of the Principal Distribution Amount for such
Distribution Date over the amounts, if any, distributed on such
Distribution Date pursuant to clauses (ii), (v), (viii), (xi), (xiv)
and (xvii) above;
(xxi) to reimburse the Holders of the Class B-4 Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
(xxii) to make distributions of interest to the Holders of the Class B-5
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxiii) after the Class Principal Balances of the Class A, Class B-1, Class
B-2, Class B-3 and Class B-4 Certificates have been reduced to zero,
to make distributions of principal to the Holders of the Class B-5
Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of the Class B-5 Certificates and
(B) the excess, if any, of the Principal Distribution Amount for such
Distribution Date
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over the amounts, if any, distributed on such Distribution Date
pursuant to clauses (ii), (v), (viii), (xi), (xiv) (xvii) and (xx)
above;
(xxiv) to reimburse the Holders of the Class B-5 Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
(xxv) to make distributions of interest to the Holders of the Class B-6
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxvi) after the Class Principal Balances of the Class A, Class B-1, Class
B-2, Class B-3 Class B-4 and Class B-5 Certificates have been reduced
to zero, to make distributions of principal to the Holders of the
Class B-6 Certificates, up to an amount equal to the lesser of (A) the
then outstanding Class Principal Balance of the Class B-6 Certificates
and (B) the excess, if any, of the Principal Distribution Amount for
such Distribution Date over the amounts, if any, distributed on such
Distribution Date pursuant to clauses (ii), (v), (viii), (xi), (xiv)
(xvii), (xx) and (xxiii) above;
(xxvii) to reimburse the Holders of the Class B-6 Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
(xxviii) to make distributions of interest to the Holders of the Class B-7
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxix) after the Class Principal Balances of the Class A, Class B-1, Class
B-2, Class B-3, Class B-4, Class B-5, and Class B-6 Certificates have
been reduced to zero, to make distributions of principal to the
Holders of the Class B-7 Certificates, up to an amount equal to the
lesser of (A) the then outstanding Class Principal Balance of the
Class B- 7 Certificates and (B) the excess, if any, of the Principal
Distribution Amount for such Distribution Date over the amounts, if
any, distributed on such Distribution Date pursuant to clauses (ii),
(v), (viii), (xi), (xiv) (xvii), (xx), (xxiii) and (xxvi) above;
(xxx) to reimburse the Holders of the Class B-7 Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
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(xxxi) to make distributions of interest to the Holders of the Class C
Certificates, up to an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxxii) after the Class Principal Balances of the Class A and Class B
Certificates have been reduced to zero, to make distributions of
principal to the Holders of the Class C Certificates, up to an amount
equal to the lesser of (A) the then outstanding Class Principal
Balance of the Class C Certificates and (B) the excess, if any, of the
Principal Distribution Amount for such Distribution Date over the
amounts, if any, distributed on such Distribution Date pursuant to
clauses (ii), (v), (viii), (xi), (xiv) (xvii), (xx), (xxiii), (xxvi)
and (xxix) above;
(xxxiii) to reimburse the Holders of the Class C Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund
Expenses, if any, previously allocated to such Class of Certificates
and for which no reimbursement has previously been received;
(xxxiv) to make distributions to the Holders of the Class R-III
Certificates, up to an amount equal to the excess, if any, of (A) the
aggregate distributions deemed made in respect of the REMIC II Regular
Interests on such Distribution Date pursuant to Section 4.01(h), over
(B) the aggregate distributions made in respect of the Regular
Interest Certificates on such Distribution Date pursuant to clauses
(i) through (xxxiii) above;
(xxxv) to make distributions to the Holders of the Class R-II Certificates,
up to an amount equal to the excess, if any, of (A) the aggregate
distributions deemed made in respect of the REMIC I Regular Interests
on such Distribution Date pursuant to Section 4.01(i), over (B) the
aggregate distributions deemed made in respect of the REMIC II Regular
Interests on such Distribution Date pursuant to Section 4.01(h); and
(xxxvi) to make distributions to the Holders of the Class R-I Certificates,
up to an amount equal to the excess, if any, of (A) the Available
Distribution Amount for such Distribution Date, over (B) the aggregate
distributions made in respect of the other Classes of Certificates on
such Distribution Date pursuant to clauses (i) through (xxxv) above;
provided that, on the Final Distribution Date, the distributions of
principal to be made pursuant to clauses (ii), (v), (viii), (xi), (xiv)
(xvii), (xx), (xxiii), (xxvi), (xxix) and (xxxii) above shall, in each such
case, subject to the then remaining portion of the Available Distribution
Amount for such date, be made to the Holders of the relevant Class or
Classes of Sequential Pay Certificates otherwise entitled to distributions
of principal pursuant to such clause in an amount equal to the entire then
remaining Class Principal Balance (or, in the case of clause (ii) above, if
applicable, the entire aggregate of the then remaining Class Principal
Balances) of such Class or Classes of Certificates outstanding immediately
prior to such Final Distribution Date.
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On each Distribution Date prior to the earlier of (i) the Senior Principal
Distribution CrossOver Date and (ii) the Final Distribution Date, the Trustee
shall pay the distributions of principal made on the Class A-1A and Class A-1B
Certificates pursuant to clause (ii) above, first, to the Holders of the Class
A-1A Certificates, until the Class Principal Balance of such Class has been
reduced to zero, and thereafter, to the Holders of the Class A-1B Certificates,
until the Class Principal Balance of such Class has been reduced to zero. On any
Distribution Date coinciding with or following the Senior Principal Distribution
Cross-Over Date, and (in any event) on the Final Distribution Date, the Trustee
shall pay the distributions of principal made on the Class A-1A and Class A-1B
Certificates pursuant to clause (ii) above to the Holders of the Class A-1A
Certificates and the Holders of the Class A-1B Certificates, pro rata in
accordance with the respective Class Principal Balances of such Classes
outstanding immediately prior to such Distribution Date, until the Class
Principal Balance of each such Class has been reduced to zero.
All distributions of interest made in respect of the Class CP Certificates
on any Distribution Date pursuant to clause (i) above, shall be deemed to have
been made in respect of the Class CP REMIC III Regular Interests, pro rata in
accordance with the respective amounts of Distributable Component Interest in
respect of each Class CP REMIC III Regular Interest for such Distribution Date
and, to the extent not previously deemed paid pursuant to this paragraph, for
all prior Distribution Dates.
All distributions of interest made in respect of the Class S Certificates
on any Distribution Date pursuant to clause (i) above, shall be deemed to have
been made in respect of the Class S REMIC III Regular Interests, pro rata in
accordance with the respective amounts of Distributable Component Interest in
respect of each Class S REMIC III Regular Interest for such Distribution Date
and, to the extent not previously deemed paid pursuant to this paragraph, for
all prior Distribution Dates.
(b) If a Prepayment Premium is collected with respect to any Mortgage Loan
during any particular Collection Period and either (i) the Distribution Date
corresponding to such Collection Period occurs after the end of April 2005 or
(ii) the Class Notional Amount of the Class CP Certificates will not be affected
by the distributions of principal on the Distribution Date corresponding to such
Collection Period, then the Trustee shall, on the Distribution Date
corresponding to such Collection Period, withdraw from the Distribution Account
and distribute the entire amount of such Prepayment Premium as additional
interest to the Holders of the Class S Certificates.
If a Prepayment Premium is collected with respect to any Mortgage Loan
during any particular Collection Period, the Distribution Date corresponding to
such Collection Period occurs during or prior to April 2005 and the Class
Notional Amount of the Class CP Certificates will be affected by the
distributions of principal on the Distribution Date corresponding to such
Collection Period, then the Trustee shall, on the Distribution Date
corresponding to such Collection Period, withdraw from the Distribution Account
and distribute the amount of such Prepayment Premium as follows: 25% of the
amount of such Prepayment Premium shall be distributed as additional interest to
the Holders of the Class CP Certificates, and 75% of the amount of such
Prepayment Premium shall be distributed as additional interest to the Holders of
the Class S Certificates.
If a Yield Maintenance Premium is collected with respect to any Mortgage
Loan during any particular Collection Period, then the Trustee shall, on the
Distribution Date corresponding to such Collection Period, withdraw from the
Distribution Account and distribute the amount of such Yield Maintenance Premium
as additional interest as follows: The Holders of the Class (or Classes) of
Sequential Pay Certificates then entitled to distributions of principal on such
Distribution Date shall be entitled to an
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aggregate amount (allocable among such Classes, if more than one, as provided
below) equal to the product of (i) the amount of such Yield Maintenance Premium,
multiplied by (ii) the lesser of (A) 25% and (B) a fraction (not greater than
one or less than zero), the numerator of which is equal to the excess, if any,
of the Pass-Through Rate for the corresponding Interest Accrual Period in
respect of such Class of Sequential Pay Certificates (or, if two or more Classes
are involved, the Pass-Through Rate for the corresponding Interest Accrual
Period in respect of such of those Classes as has the most senior right of
payment pursuant to Section 4.01(a), with the Class A-1A Certificates being
deemed senior to the Class A-1B Certificates solely for this purpose), over the
relevant Discount Rate, and the denominator of which is equal to the excess, if
any, of the Mortgage Rate for the Mortgage Loan in respect of which such Yield
Maintenance Premium was received, over the relevant Discount Rate. Any portion
of such Yield Maintenance Premium that may remain after such distributions will
be distributed as provided above as if it was a Prepayment Premium.
For purposes of the foregoing paragraph, the "Discount Rate" shall be the
rate which, when compounded monthly, is equivalent to the Treasury Rate when
compounded semi-annually (e.g., a 6% per annum Treasury Rate would equate to a
5.9263% per annum Discount Rate). The "Treasury Rate" is the yield calculated by
the linear interpolation of the yields, as reported in Federal Reserve
Statistical Release H.15--Selected Interest Rates under the heading "U.S.
government securities/Treasury constant maturities" for the week ending prior to
the date of the relevant principal prepayment, of U.S. Treasury constant
maturities with a maturity date (one longer and one shorter) most nearly
approximating the maturity date of the prepaid Mortgage Loan. If Release H.15 is
no longer published, the Servicer shall select a comparable publication to
determine the Treasury Rate.
Any Prepayment Premiums and/or Yield Maintenance Premiums distributed in
respect of the Class CP Certificates on any Distribution Date pursuant to the
foregoing paragraphs of this Section 4.01(b) shall be deemed to have been
distributed in respect of the respective Class CP REMIC III Regular Interests,
pro rata in accordance with the respective amounts by which their Component
Notional Amounts were reduced in connection with the deemed distributions of
principal made on the REMIC II Regular Interests on such Distribution Date
pursuant to Section 4.01(h). In addition, any Prepayment Premiums and/or Yield
Maintenance Premiums distributed in respect of the Class S Certificates on any
Distribution Date pursuant to the foregoing paragraphs of this Section 4.01(b)
shall be deemed to have been distributed in respect of the respective Class S
REMIC III Regular Interests, pro rata in accordance with the respective amounts
by which their Component Notional Amounts were reduced in connection with the
deemed distributions of principal made on the REMIC II Regular Interests on such
Distribution Date pursuant to Section 4.01(h).
(c) All distributions made with respect to each Class of Certificates on
each Distribution Date shall be allocated pro rata among such Certificates based
on their respective Percentage Interests. Except as otherwise provided below,
all such distributions made with respect to each Class of Certificates on each
Distribution Date shall be made to the Holders of such Certificates of record at
the close of business on the related Record Date and, in the case of each such
Holder, shall be made by wire transfer of immediately available funds to the
account thereof at a bank or other entity having appropriate facilities
therefor, if such Holder shall have provided the Trustee with wiring
instructions no less than five Business Days prior to the related Record Date
(which wiring instructions may be in the form of a standing order applicable to
all subsequent Distribution Dates), and otherwise shall be made by check mailed
to the address of such Holder as it appears in the Certificate Register. The
final distribution on each Certificate (determined, in the case of a Sequential
Pay Certificate, without regard to any possible future reimbursement of
previously allocated Realized Losses or Additional Trust Fund Expenses in
respect of such Certificate) will be made in like manner, but only upon
presentation and surrender of such Certificate at the offices of the Certificate
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Registrar or such other location specified in the notice to Certificateholders
of such final distribution. Any distribution that is to be made with respect to
a Sequential Pay Certificate in reimbursement of a Realized Loss or Additional
Trust Fund Expense previously allocated thereto, which reimbursement is to occur
after the date on which such Certificate is surrendered as contemplated by the
preceding sentence, will be made by check mailed to the Holder that surrendered
such Certificate at the last address set forth for such Holder in the
Certificate Register or at any other address of which the Trustee was
subsequently notified in writing.
(d) Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the related Certificate Owners that it represents and to each indirect
participating brokerage firm (a "brokerage firm" or "indirect participating
firm") for which it acts as agent. Each brokerage firm shall be responsible for
disbursing funds to the related Certificate Owners that it represents. None of
the parties hereto shall have any responsibility therefor except as otherwise
provided by this Agreement or applicable law. The Trustee and the Depositor
shall perform their respective obligations under the Letter of Representations
among the Depositor, the Trustee and the initial Depository, a copy of which
Letter of Representations is attached hereto as Exhibit C.
(e) The rights of the Certificateholders to receive distributions from the
proceeds of the Trust Fund in respect of their Certificates, and all rights and
interests of the Certificateholders in and to such distributions, shall be as
set forth in this Agreement. Neither the Holders of any Class of Certificates
nor any party hereto shall in any way be responsible or liable to the Holders of
any other Class of Certificates in respect of amounts properly previously
distributed on the Certificates.
(f) Except as otherwise provided in Section 9.01, whenever the Trustee
expects that the final distribution with respect to any Class of Certificates
will be made on the next Distribution Date (such final distribution to be
determined, in the case of a Class of Sequential Pay Certificates, without
regard to any possible future reimbursement of previously allocated Realized
Losses and Additional Trust Fund Expenses in respect of such Class), the Trustee
shall, as promptly as possible (and, in any event, no later than five days)
after the related Determination Date, mail to each Holder of record on such date
of such Class of Certificates a notice to the effect that:
(i) the Trustee expects that the final distribution with respect to such
Class of Certificates will be made on such Distribution Date but only upon
presentation and surrender of such Certificates at the office of the
Certificate Registrar or at such other location therein specified, and
(ii) no interest shall accrue on such Certificates from and after the end
of the Interest Accrual Period for such Distribution Date.
Any funds not distributed to any Holder or Holders of Certificates of such Class
on such Distribution Date because of the failure of such Holder or Holders to
tender their Certificates shall, on such date, be set aside and held uninvested
in trust and credited to the account or accounts of the appropriate
non-tendering Holder or Holders. If any Certificates as to which notice has been
given pursuant to this Section 4.01(f) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Trustee shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates
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for cancellation in order to receive the final distribution with respect
thereto. If within one year after the second notice all such Certificates shall
not have been surrendered for cancellation, then the Trustee, directly or
through an agent, shall take such steps to contact the remaining non-tendering
Certificateholders concerning the surrender of their Certificates as it shall
deem appropriate. The costs and expenses of holding such funds in trust and of
contacting such Certificateholders following the first anniversary of the
delivery of such second notice to the non-tendering Certificateholders shall be
paid out of such funds. No interest shall accrue or be payable to any former
Holder on any amount held in trust pursuant to this paragraph. If all of the
Certificates shall not have been surrendered for cancellation by the second
anniversary of the delivery of the second notice, then, subject to applicable
escheat laws, the Trustee shall distribute to the Class R-III Certificateholders
all unclaimed funds.
(g) Notwithstanding any other provision of this Agreement, the Trustee
shall comply with all federal withholding requirements respecting payments to
Certificateholders of interest or original issue discount that the Trustee
reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. If the Trustee
does withhold any amount from payments of interest or original issue discount to
any Certificateholder pursuant to federal withholding requirements, the Trustee
shall indicate the amount withheld to such Certificateholder.
(h) All distributions made in respect of each Class of Sequential Pay
Certificates on each Distribution Date pursuant to Section 4.01(a) or 4.01(b)
shall be deemed to have first been distributed from REMIC II to REMIC III in
respect of the Corresponding REMIC II Regular Interest for such Class of
Certificates; all distributions made in respect of the Class CP Certificates on
each Distribution Date pursuant to Section 4.01(a) or 4.01(b), and allocable to
any particular Class CP REMIC III Regular Interest, shall be deemed to have
first been distributed from REMIC II to REMIC III in respect of the
Corresponding REMIC II Regular Interest for such Class CP REMIC III Regular
Interest; and all distributions made in respect of the Class S Certificates on
each Distribution Date pursuant to Section 4.01(a) or 4.01(b), and allocable to
any particular Class S REMIC III Regular Interest, shall be deemed to have first
been distributed from REMIC II to REMIC III in respect of the Corresponding
REMIC II Regular Interest for such Class S REMIC III Regular Interest. In each
case, if such distribution on any such Class of Certificates was a distribution
of interest, of principal, of additional interest (in the form of Prepayment
Premiums or Yield Maintenance Premiums) or in reimbursement of any previously
allocated Realized Losses and Additional Trust Fund Expenses in respect of such
Class of Certificates, then the corresponding distribution deemed to be made on
a REMIC II Regular Interest pursuant to the preceding sentence shall be deemed
to also be a distribution of interest, of principal, of additional interest (in
the form of Prepayment Premiums or Yield Maintenance Premiums) or in
reimbursement of any previously allocated Realized Losses and Additional Trust
Fund Expenses, as the case may be, in respect of such REMIC II Regular Interest;
provided that, in the case of distributions on the Class A-1B Certificates, the
corresponding distributions deemed made on REMIC II Regular Interest A-1B1 and
REMIC II Regular Interest A-1B2 shall be allocated as follows: (i) in the case
of interest, pro rata based on entitlement; (ii) in the case of principal, first
to REMIC II Regular Interest A-1B1 until the Uncertificated Principal Balance
thereof is reduced to zero, and then to REMIC II Regular Interest A-1B2; (iii)
in the case of additional interest (in the form of Prepayment Premiums or Yield
Maintenance Premiums), entirely to REMIC II Regular Interest A-1B1 until the
Uncertificated Principal Balance thereof is reduced to zero, and then to REMIC
II Regular Interest A-1B2; and (iv) in the case of reimbursements of any
previously allocated Realized Losses and Additional Trust Fund Expenses, pro
rata based on entitlement. The actual distributions made by the Trustee on each
Distribution Date in respect of the REMIC III Certificates pursuant to Section
4.01(a) or 4.01(b), as applicable, shall be deemed to have been so made from the
amounts deemed distributed in respect of the REMIC II Regular Interests on such
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Distribution Date pursuant to this Section 4.01(h). Notwithstanding the deemed
distributions on the REMIC II Regular Interests described in this Section
4.01(h), actual distributions of funds from the Distribution Account shall be
made only in accordance with Section 4.01(a) or 4.01(b), as applicable.
(i) On each Distribution Date, immediately prior to making any actual
distributions on the REMIC III Certificates pursuant to Section 4.01(a) or the
corresponding deemed distributions on the REMIC II Regular Interests pursuant to
Section 4.01(h), the Trustee shall be deemed to have made out of the Available
Distribution Amount for such Distribution Date, the following distributions in
the following order of priority, in each case to the extent of the remaining
portion of such Available Distribution Amount:
first, distributions of interest to REMIC II in respect of all the REMIC I
Regular Interests, up to an amount equal to, and pro rata among the REMIC I
Regular Interests in accordance with, all Uncertificated Distributable
Interest in respect of each REMIC I Regular Interest for such Distribution
Date and, to the extent not previously deemed paid pursuant to this Section
4.01(i), for all prior Distribution Dates;
second, distributions of principal to REMIC II in respect of all the REMIC
I Regular Interests, up to an amount equal to, and pro rata among the REMIC
I Regular Interests in accordance with, that portion, if any, of the
Principal Distribution Amount attributable to each and every Mortgage Loan
and/or REO Mortgage Loan, as the case may be, that relates to each REMIC I
Regular Interest; and
third, distributions to REMIC II in respect of all the REMIC I Regular
Interests (including any REMIC I Regular Interests whose Uncertificated
Principal Balances have previously been reduced to zero), up to an amount
equal to, in reimbursement of, and pro rata in accordance with, all
Realized Losses and Additional Trust Fund Expenses previously deemed
allocated to each REMIC I Regular Interest pursuant to Section 4.04(c) that
have not previously been deemed reimbursed on any prior Distribution Date
pursuant to this Section 4.01(i).
In addition, on each Distribution Date, immediately prior to making any
actual distributions on the REMIC III Certificates pursuant to Section 4.01(b)
or the corresponding deemed distributions on the REMIC II Regular Interests
pursuant to Section 4.01(h), the Trustee shall be deemed to have distributed to
REMIC II each Prepayment Premium and Yield Maintenance Premium then on deposit
in the Distribution Account that was received on any Mortgage Loan or REO
Mortgage Loan during or prior to the related Collection Period, such
distribution to be deemed made in respect of the REMIC I Regular Interest that
relates to such Mortgage Loan or REO Mortgage Loan, as the case may be.
The distributions deemed made by the Trustee on each Distribution Date in
respect of the REMIC II Regular Interests pursuant to Section 4.01(h),as well as
the distributions actually made by the Trustee on each Distribution Date in
respect of the Class R-II and REMIC III Certificates pursuant to Section 4.01(a)
and/or Section 4.01(b), shall be deemed to have been so made or deemed made, as
the case may be, from the amounts deemed distributed in respect of the REMIC I
Regular Interests on such Distribution Date pursuant to this Section 4.01(i).
Notwithstanding the deemed distributions on the REMIC I Regular Interests
described in this Section 4.01(i), actual distributions of funds from the
Distribution Account shall be made only in accordance with Section 4.01(a) or
4.01(b), as applicable.
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SECTION 4.02. Statements to Certificateholders; Certain Other Reports.
(a) Based solely on information provided to the Trustee by the Servicer and
the Special Servicer pursuant to Sections 4.02(b) and 4.02(c), the Trustee shall
prepare, or cause to be prepared, and mail on each Distribution Date, or as soon
thereafter as is practicable, to the Depositor, the Rating Agencies, each
Certificateholder and, to the extent that the Trustee has in accordance with
Section 5.06 confirmed the Ownership Interest in the Certificates held thereby,
each Certificate Owner a statement in respect of the distribution made on such
Distribution Date setting forth to the extent applicable to such Class the
information set forth in Exhibit E-1 hereto (the "Trustee Report"); provided
that the Trustee need not deliver to the Depositor, S&P and Moody's any Trustee
Report that has been made available via the Trustee's Internet Website as
provided below; and provided, further, that the Trustee has no affirmative
obligation to discover the identities of Certificate Owners and need only react
to Persons claiming to be Certificate Owners. After the Underwriter has sold all
the Certificates in connection with the initial public offering (in the case of
the Registered Certificates) or private placement (in the case of the
Non-Registered Certificates) thereof (as confirmed in writing by the Depositor
to the Trustee), the Trustee shall make available each month, to any interested
party, the Trustee Report via the Trustee's Internet Website, electronic
bulletin board and fax-on-demand service. In addition, after the Underwriter has
sold all the Certificates in connection with the initial public offering (in the
case of the Registered Certificates) or private placement (in the case of the
Non-Registered Certificates) thereof (as confirmed in writing by the Depositor
to the Trustee), the Trustee shall also make Mortgage Loan information as
presented in the CSSA loan setup file and CSSA loan periodic update file formats
available to any Certificateholder, any Certificate Owner, the Rating Agencies,
the parties hereto or any other interested party via the Trustee's Website. In
connection with providing access to the Trustee's Website or electronic bulletin
board, the Trustee may require registration and the acceptance of a disclaimer.
The Trustee shall not be liable for the dissemination of information in
accordance with this Agreement.
The Trustee is hereby directed and authorized to make available, as a
convenience to interested parties (and not in furtherance of the distribution of
the Prospectus or the Prospectus Supplement under the securities laws), this
Agreement, the Prospectus and the Prospectus Supplement via the Trustee's
Website. The Trustee will make no representations or warranties as to the
accuracy or completeness of such documents and will assume no responsibility
therefor.
The Trustee shall be entitled to rely on but shall not be responsible for
the content or accuracy of any information provided by third parties for
purposes of preparing the Trustee Report and may affix thereto any disclaimer it
deems appropriate in its reasonable discretion (without suggesting liability on
the part of any other party hereto).
(b) By 1:00 p.m. New York City time on the third Business Day after the end
of each Collection Period (but, in any event, by 1:00 p.m. New York City time on
the second Business Day prior to the related Distribution Date), the Servicer
shall deliver to the Trustee and the Special Servicer a report substantially in
the form annexed hereto as Exhibit E-2 or, at the discretion of the Servicer
(provided that no less information is provided than is set forth on Exhibit E-2
hereto), in a CSSA format (the "Determination Date Report"), reflecting
information as of the close of business on the last day of the Collection
Period, in a mutually agreeable electronic format. The Determination Date Report
and any written information supplemental thereto shall include such information
with respect to the Mortgage Loans that is required by the Trustee for purposes
of making the calculations and reports referred to in Section 4.01, this Section
4.02, Section 4.05 and otherwise in this Agreement, as set forth in written
specifications or guidelines issued by
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the Trustee from time to time. Such information may be delivered by the Servicer
to the Trustee by telecopy or in such electronic or other form as may be
reasonably acceptable to the Trustee. The Special Servicer shall from time to
time (and, in any event, as may be reasonably required by the Servicer) provide
the Servicer with such information in its possession regarding the Specially
Serviced Mortgage Loans and REO Properties as may be necessary for the Servicer
to prepare each Determination Date Report and any supplemental information to be
provided by the Servicer to the Trustee.
Simultaneously with the delivery of the Determination Date Report, the
Servicer shall deliver to the Trustee and the Special Servicer a report
containing the information required by the form annexed hereto as Exhibit E-4
(the "Portfolio Performance Report"), such information to be current (based on
information then in its possession) as of the end of the most recently ended
Collection Period, provided, however, that any information in such Portfolio
Performance Report that is derived from the Special Servicer Report referred to
below will be current (based on information then in the possession of the
Special Servicer) as of the end of the second most recently ended Collection
Period. Such information may be delivered by the Servicer to the Trustee and the
Special Servicer by telecopy or in such electronic or other form as may be
reasonably acceptable to the Trustee. At the discretion of the Servicer, such
information may be delivered to the Trustee and Special Servicer in a CSSA
format.
No later than the third Business Day after each Determination Date,
beginning in April 1998, the Servicer shall prepare and deliver to the Trustee,
the Special Servicer and the Controlling Class Representative a schedule
(substantially in the form annexed hereto as Exhibit E-6) of all Mortgage Loans
that constitute one of the following types of Mortgage Loans as of such
Determination Date (the "Watch List"): (i) a Mortgage Loan that has a then
current Debt Service Coverage Ratio that is 80% or less of its Debt Service
Coverage Ratio as of the Cut-Off Date or that has a Debt Service Coverage Ratio
that is less than 1.00x; (ii) a Mortgage Loan as to which any required
inspection of the related Mortgaged Property conducted by the Servicer indicates
a problem that the Servicer determines can reasonably be expected to materially
adversely affect the cash flow generated by such Mortgaged Property; (iii) a
Mortgage Loan as to which the Servicer has actual knowledge of material damage
or waste at the related Mortgaged Property; (iv) a Mortgage Loan as to which it
has come to the Servicer's attention in the performance of its duties under this
Agreement (without any expansion of such duties by reason thereof) that any
tenant occupying 25% or more of the space in the related Mortgaged Property (A)
has vacated such space (without being replaced by a comparable tenant and lease)
or (B) has declared bankruptcy; (v) a Mortgage Loan that is at least 30 days
delinquent in payment; and (vi) a Mortgage Loan that is within 60 days of
maturity. No later than one Business Day after each Determination Date, the
Special Servicer shall provide the Servicer with all information in its
possession regarding the Specially Serviced Mortgage Loans relevant to the
preparation of the Watch List.
The Servicer shall be entitled to rely on but shall not be responsible for
the content or accuracy of any information provided by third parties (other than
a Sub-Servicer) for purposes of preparing the Determination Date Report, the
Portfolio Performance Report and the Watch List and may affix thereto any
disclaimer it deems appropriate in its reasonable discretion (without suggesting
liability on the part of any other party hereto).
After the Underwriter has sold all the Certificates in connection with the
initial public offering (in the case of the Registered Certificates) or private
placement (in the case of the Non-Registered Certificates) thereof (as confirmed
in writing by the Depositor to the Servicer), the Servicer shall make available
each month, to any interested party, the Portfolio Performance Report, the
Determination Date
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Report and the Watch List via the Servicer's Internet Website. In addition,
after the Underwriter has sold all the Certificates in connection with the
initial public offering (in the case of the Registered Certificates) or private
placement (in the case of the Non-Registered Certificates) thereof (as confirmed
in writing by the Depositor to the Servicer), the Servicer shall also make
available to any interested party such other information regarding the Mortgage
Loans as the Depositor and the Servicer may agree via the Servicer's Internet
Website. In connection with providing access to the Servicer's Website, the
Servicer may require registration and acceptance of a disclaimer. The Servicer
shall not be liable for the dissemination of information in accordance with this
Agreement.
Notwithstanding the foregoing, however, nothing in this Section 4.02(b) or
in Section 4.02(c) shall detract from the obligation of the Servicer or the
Special Servicer to observe any applicable law prohibiting disclosure of
information with respect to the Mortgage Loans or Mortgaged Properties, and the
failure of the Servicer or Special Servicer to disclose any such information for
such reason shall not constitute a breach of this Section 4.02(b) or of Section
4.02(c). The Servicer or the Special Servicer may affix to any information
provided by it any disclaimer it deems appropriate in its reasonable discretion
(without suggesting liability on the part of any other party hereto).
(c) By the 25th day of each month (or, if such 25th day is not a Business
Day, then the next succeeding Business Day), the Special Servicer shall deliver
to the Servicer and the Trustee a report substantially in the form of Exhibit
E-3 (the "Special Servicer Report") reflecting information in its possession as
of the close of business on the last day of the Collection Period ending in such
month. The information contained in such Special Servicer Report shall be
incorporated by the Servicer into the Portfolio Performance Report to be
prepared and delivered by the Servicer in the following month pursuant to
Section 4.02(b).
(d) Within a reasonable period of time after the end of each calendar year,
the Trustee shall prepare, or cause to be prepared, and mail to each Person who
at any time during the calendar year was a Certificateholder (i) a statement
containing the aggregate information set forth on page 1 of Exhibit E-1 hereto
for such calendar year or applicable portion thereof during which such person
was a Certificateholder and (ii) such other customary information as the Trustee
deems necessary or desirable for Certificateholders to prepare their federal,
state and local income tax returns, including the amount of original issue
discount accrued on the Certificates, if applicable. The obligations of the
Trustee in the immediately preceding sentence shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Trustee pursuant to any requirements of the Code. As soon as
practicable following the request of any Certificateholder in writing, the
Trustee shall furnish to such Certificateholder such information regarding the
Mortgage Loans and the Mortgaged Properties as such Certificateholder may
reasonably request and, to the extent such information would be required to be
included in a report described in subsection (a), (b) or (c), as has been
furnished to the Trustee. The Servicer and the Special Servicer shall promptly
provide to the Depositor, the REMIC Administrator and the Trustee such
information regarding the Mortgage Loans and the Mortgaged Properties as such
party may request and, to the extent such information would be required to be
included in a report described in subsection (c), as has been furnished to the
Servicer.
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(e) At the same time that the Trustee forwards the Trustee Report for any
Distribution Date to the Depositor, the Rating Agencies, the Certificateholders
and any Certificate Owners pursuant to Section 4.02(a), the Trustee shall also
forward to each such Person a written hard copy of the Portfolio Performance
Report related to such Distribution Date and any Watch List and Operating
Statement Analyses received since the prior Distribution Date (or, in the case
of the initial Distribution Date, since the Closing Date); provided that the
Trustee need not deliver to the Depositor, S&P and Moody's any such
Certificateholder Report that it has made available via the Trustee's Internet
Website.
SECTION 4.03. P&I Advances; Advances relating to the Servicer Remittance
Amount.
(a) On or before 1:00 p.m., New York City time, on each P&I Advance Date,
the Servicer shall, subject to Section 4.03(c) below, either (i) remit from its
own funds to the Trustee for deposit into the Distribution Account an amount
equal to the aggregate amount of P&I Advances, if any, to be made in respect of
the related Distribution Date, (ii) apply amounts held in the Collection Account
for future distribution to Certificateholders in subsequent months in discharge
of any such obligation to make P&I Advances, or (iii) make P&I Advances in the
form of any combination of (i) and (ii) aggregating the total amount of P&I
Advances to be made. Any amounts held in the Collection Account for future
distribution and so used to make P&I Advances shall be appropriately reflected
in the Servicer's records and replaced by the Servicer by deposit in the
Collection Account prior to the next succeeding Servicer Remittance Date (to the
extent not previously replaced through the deposit of Late Collections of the
delinquent principal and interest in respect of which such P&I Advances were
made). If, as of 2:00 p.m., New York City time, on any P&I Advance Date, the
Servicer shall not have made any P&I Advance required to be made on such date
pursuant to this Section 4.03(a) (and shall not have delivered to the Trustee
the Officer's Certificate and other documentation related to a determination of
nonrecoverability of a P&I Advance pursuant to Section 4.03(c)) or shall not
have remitted any portion of the Servicer Remittance Amount required to be
remitted on such date, then the Trustee shall provide notice of such failure to
the Servicer by facsimile transmission sent to Edgar L. Smith II, Chief
Operating Officer, via telecopy no. (214) 290-4480 (or such alternative
individual or number specified by the Servicer to the Trustee in writing) and
notice by telephone to the Servicer at telephone no. (214) 290-5178 (or such
alternative number provided by the Servicer to the Trustee in writing) as soon
as possible, but in any event before 3:00 p.m., New York City time, on such P&I
Advance Date. If after such notice the Trustee does not receive the full amount
of such P&I Advances and/or Servicer Remittance Amount by 5:00 p.m., New York
City time, on such P&I Advance Date, then the Trustee shall (not later than
11:00 a.m., New York City time, on the related Distribution Date) make, and if
the Trustee fails to do so, any Fiscal Agent shall (not later than 12:00 noon,
New York City time, on the related Distribution Date) make, the portion of such
P&I Advances and advance the portion of such Servicer Remittance Amount that was
required to be, but was not, made or remitted, as the case may be, by the
Servicer at or prior to such time.
(b) The aggregate amount of P&I Advances to be made by the Servicer in
respect of any Distribution Date, subject to Section 4.03(c) below, shall equal
the aggregate of all Monthly Payments (other than Balloon Payments) and any
Assumed Monthly Payments, in each case net of related Servicing Fees and Workout
Fees, due or deemed due, as the case may be, in respect of the Mortgage Loans
(including Balloon Mortgage Loans delinquent as to their respective Balloon
Payments) and any REO Mortgage Loans on their respective Due Dates during the
related Collection Period, in each case to the extent such amount was not paid
by or on behalf of the related Mortgagor or otherwise collected as of the close
of business on the related Determination Date; provided that, if an Appraisal
Reduction Amount exists with respect to any Required Appraisal Loan, then, in
the event of subsequent delinquencies thereon, the interest portion of the P&I
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Advance in respect of such Required Appraisal Loan for the related Distribution
Date shall be reduced (it being herein acknowledged that there shall be no
reduction in the principal portion of such P&I Advance) to equal the product of
(i) the amount of the interest portion of such P&I Advance for such Required
Appraisal Loan for such Distribution Date without regard to this proviso,
multiplied by (ii) a fraction, expressed as a percentage, the numerator of which
shall equal the Stated Principal Balance of such Required Appraisal Loan
immediately prior to such Distribution Date, net of the related Appraisal
Reduction Amount, and the denominator of which shall equal the Stated Principal
Balance of such Required Appraisal Loan immediately prior to such Distribution
Date.
(c) Notwithstanding anything herein to the contrary, no P&I Advance shall
be required to be made hereunder if such P&I Advance would, if made, constitute
a Nonrecoverable P&I Advance. The determination by the Servicer (or, if
applicable, the Trustee or any Fiscal Agent) that it has made a Nonrecoverable
P&I Advance or that any proposed P&I Advance, if made, would constitute a
Nonrecoverable P&I Advance, shall be made by such Person in its reasonable, good
faith judgment and shall be evidenced by an Officer's Certificate delivered to
the Depositor, to the Special Servicer, to the Controlling Class Representative
and, if made by the Servicer, to the Trustee, on or before the related P&I
Advance Date, setting forth the basis for such determination, accompanied by a
copy of an Appraisal of the related Mortgaged Property or REO Property performed
within the twelve months preceding such determination by a Qualified Appraiser,
and further accompanied by any other information, including engineers' reports,
environmental surveys or similar reports, that the Person making such
determination may have obtained and that support such determination. The Trustee
and any Fiscal Agent shall be entitled to conclusively rely on any
nonrecoverability determination made by the Servicer with respect to a
particular P&I Advance. The Special Servicer shall promptly furnish any party
required to make P&I Advances hereunder with any information in its possession
regarding the Specially Serviced Mortgage Loans and REO Properties as such party
required to make P&I Advances may reasonably request.
(d) The Trustee and any Fiscal Agent shall each be entitled to
reimbursement of the amount of any Servicer Remittance Amount advanced thereby
(together with any interest accrued thereon at the Reimbursement Rate) from
general collections on the Mortgage Loans and REO Properties on deposit in the
Collection Account, and the defaulting Servicer shall indemnify the Trust for
any such interest so paid to the Trustee or any Fiscal Agent out of the
Collection Account.
(e) Subject to the next sentence, the Servicer, the Trustee and any Fiscal
Agent shall each be entitled to receive interest at the Reimbursement Rate in
effect from time to time, accrued on the amount of each P&I Advance made thereby
(with its own funds) for so long as such P&I Advance is outstanding (or, if such
P&I Advance was made prior to the end of any grace period applicable to the
subject delinquent Monthly Payment, for so long as such P&I Advance is
outstanding following the end of such grace period), such interest to be
payable: (i) at any time, out of Default Charges collected on the particular
Mortgage Loan or REO Mortgage Loan as to which such P&I Advance relates; and
(ii) to the extent that such Default Charges are insufficient, but only after
the related Advance has been reimbursed pursuant to this Agreement, out of
general collections on the Mortgage Loans and REO Properties on deposit in the
Collection Account. The Servicer shall reimburse itself, the Trustee or any
Fiscal Agent, as applicable, for any outstanding P&I Advance made thereby as
soon as practicable after funds available for such purpose are deposited in the
Collection Account, and in no event shall interest accrue in accordance with
this Section 4.03(e) on any P&I Advance as to which the corresponding Late
Collection was received as of the related P&I Advance Date.
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SECTION 4.04. Allocation of Realized Losses and Additional Trust Fund
Expenses.
(a) On each Distribution Date, following the distributions to
Certificateholders to be made on such date pursuant to Section 4.01(a), the
Trustee shall determine the amount, if any, by which (i) the then aggregate of
the Class Principal Balances of all the Classes of Sequential Pay Certificates,
exceeds (ii) the aggregate Stated Principal Balance of the Mortgage Pool that
will be outstanding immediately following such Distribution Date. If such excess
does exist, then the Class Principal Balances of the Class C, Class B-7, Class
B-6, Class B-5, Class B-4, Class B-3, Class B-2, Class B-1, Class A-3 and Class
A-2 Certificates shall be reduced sequentially, in that order, in each case,
until such excess or the related Class Principal Balance is reduced to zero
(whichever occurs first). If, after the foregoing reductions, the amount
described in clause (i) of the second preceding sentence still exceeds the
amount described in clause (ii) of such sentence, then the respective Class
Principal Balances of the Class A-1A Certificates and the Class A-1B
Certificates shall be reduced on a pro rata basis in accordance with the
relative sizes of such Class Principal Balances, until any such remaining excess
is reduced to zero. All such reductions in the Class Principal Balances of the
respective Classes of the Sequential Pay Certificates shall constitute
allocations of Realized Losses and Additional Trust Fund Expenses.
(b) On each Distribution Date, following the deemed distributions to be
made in respect of the REMIC II Regular Interests on such date pursuant to
Section 4.01(h), the Trustee shall determine the amount, if any, by which (i)
the then aggregate Uncertificated Principal Balance of the REMIC II Regular
Interests, exceeds (ii) the aggregate Stated Principal Balance of the Mortgage
Pool that will be outstanding immediately following such Distribution Date. If
such excess does exist, then the Uncertificated Principal Balances of REMIC II
Regular Interest C, REMIC II Regular Interest B-7, REMIC II Regular Interest
B-6, REMIC II Regular Interest B-5, REMIC II Regular Interest B-4, REMIC II
Regular Interest B-3, REMIC II Regular Interest B-2, REMIC II Regular Interest
B-1, REMIC II Regular Interest A-3 and REMIC II Regular Interest A-2 shall be
reduced sequentially, in that order, in each case, until such excess or the
related Uncertificated Principal Balance is reduced to zero (whichever occurs
first). If, after the foregoing reductions, the amount described in clause (i)
of the second preceding sentence still exceeds the amount described in clause
(ii) of such sentence, then the respective Uncertificated Principal Balances of
REMIC II Regular Interest A-1A, on the one hand, and REMIC II Regular Interests
A-1B1 and A-1B2, on the other, shall be reduced on a pro rata basis in
accordance with the relative sizes of such Uncertificated Principal Balances
(with any such allocation to REMIC II Regular Interests A-1B1 and A-1B2 to be
made sequentially in that order), until any such remaining excess is reduced to
zero. All such reductions in the Uncertificated Principal Balances of the
respective REMIC II Regular Interests shall be deemed to constitute allocations
of Realized Losses and Additional Trust Fund Expenses.
(c) On each Distribution Date, following the deemed distributions to be
made in respect of the REMIC I Regular Interests pursuant to Section 4.01(i),
the Uncertificated Principal Balance of each REMIC I Regular Interest (after
taking account of such deemed distributions) shall be reduced to equal the
Stated Principal Balance (or, if applicable in cases involving the substitution
of multiple Replacement Mortgage Loans, the aggregate Stated Principal Balance)
of each and every related Mortgage Loan and/or REO Mortgage Loan, as the case
may be, that will be outstanding immediately following such Distribution Date.
All such reductions in the Uncertificated Principal Balances of the respective
REMIC I Regular Interests shall be deemed to constitute allocations of Realized
Losses and Additional Trust Fund Expenses.
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SECTION 4.05. Calculations.
The Trustee shall, provided it receives the necessary information from the
Servicer, be responsible for performing all calculations necessary in connection
with the actual and deemed distributions to be made pursuant to Section 4.01,
the preparation of the Trustee Reports pursuant to Section 4.02(a) and the
actual and deemed allocations of Realized Losses and Additional Trust Fund
Expenses to be made pursuant to Section 4.04. The Trustee shall calculate the
Available Distribution Amount for each Distribution Date and shall allocate such
amount among Certificateholders in accordance with this Agreement. Absent actual
knowledge of an error therein, the Trustee shall have no obligation to
recompute, recalculate or otherwise verify any information provided to it by the
Servicer. The calculations by the Trustee contemplated by this Section 4.05
shall, in the absence of manifest error, be presumptively deemed to be correct
for all purposes hereunder.
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ARTICLE V
THE CERTIFICATES
SECTION 5.01. The Certificates.
(a) The Certificates will be substantially in the respective forms attached
hereto as Exhibits A-1 through A-5; provided, however, that any of the
Certificates may be issued with appropriate insertions, omissions, substitutions
and variations, and may have imprinted or otherwise reproduced thereon such
legend or legends, not inconsistent with the provisions of this Agreement, as
may be required to comply with any law or with rules or regulations pursuant
thereto, or with the rules of any securities market in which the Certificates
are admitted to trading, or to conform to general usage. The Certificates will
be issuable in registered form only; provided, however, that in accordance with
Section 5.03 beneficial ownership interests in the Book-Entry Certificates shall
initially be held and transferred through the book-entry facilities of the
Depository. The Senior Certificates will be issuable only in denominations
corresponding to initial Certificate Principal Balances (or, in the case of the
Class CP and Class S Certificates, initial Certificate Notional Amounts) as of
the Closing Date of not less than $10,000 and in any whole dollar denomination
in excess thereof. The Sequential Pay Certificates (other than the Class A-1A
and Class A-1B Certificates) will be issuable only in denominations
corresponding to initial Certificate Principal Balances as of the Closing Date
of not less than $100,000 and in any whole dollar denomination in excess
thereof. The Residual Interest Certificates will be issuable only in
denominations representing Percentage Interests in the related Class of not less
than 10.0%.
(b) The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee in its capacity as trustee hereunder by an authorized
officer. Certificates bearing the manual or facsimile signatures of individuals
who were at any time the authorized officers of the Trustee shall be entitled to
all benefits under this Agreement, subject to the following sentence,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates. No Certificate shall be
entitled to any benefit under this Agreement, or be valid for any purpose,
however, unless there appears on such Certificate a certificate of
authentication substantially in the form provided for herein executed by the
Certificate Registrar by manual signature, and such certificate of
authentication upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication.
SECTION 5.02. Registration of Transfer and Exchange of Certificates.
(a) At all times during the term of this Agreement, there shall be
maintained at the office of the Certificate Registrar a Certificate Register in
which, subject to such reasonable regulations as the Certificate Registrar
(located as of the Closing Date at Norwest Center, Sixth and Marquette,
Minneapolis, Minnesota 55479-0113) may prescribe, the Certificate Registrar
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. The Trustee is hereby initially
appointed (and hereby agrees to act in accordance with the terms hereof) as
Certificate Registrar for the purpose of registering Certificates and transfers
and exchanges of Certificates as herein provided. The Trustee may appoint, by a
written instrument delivered to the other parties hereto, any other bank or
trust company to act as Certificate Registrar under such conditions as the
Trustee may prescribe, provided that the Trustee shall not be relieved of any of
its duties or responsibilities hereunder as Certificate Registrar by
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reason of such appointment. If the Trustee resigns or is removed in accordance
with the terms hereof, the successor trustee shall immediately succeed to its
predecessor's duties as Certificate Registrar. The Depositor, the Servicer, the
Special Servicer and the REMIC Administrator shall have the right to inspect the
Certificate Register or to obtain a copy thereof at all reasonable times, and to
rely conclusively upon a certificate of the Certificate Registrar as to the
information set forth in the Certificate Register.
If three or more Holders make written request to the Trustee, and such
request states that such Holders desire to communicate with other Holders with
respect to their rights under this Agreement or under the Certificates and is
accompanied by a copy of the communication which such Holders propose to
transmit, then the Trustee shall, within 30 days after the receipt of such
request, afford (or cause any other Certificate Registrar to afford) the
requesting Holders access during normal business hours to the most recent list
of Certificateholders held by the Certificate Registrar. Every
Certificateholder, by receiving such access, acknowledges that the Certificate
Registrar will not be held accountable in any way by reason of the disclosure of
any information as to the names and addresses of any Certificateholder
regardless of the source from which such information was derived.
The Trustee, the Certificate Registrar and the Depositor shall provide a
current Certificateholder list to any Gaming Authority upon written demand
therefor.
(b) No transfer, sale, pledge or other disposition of any Non-Registered
Certificate or interest therein shall be made unless that transfer, sale, pledge
or other disposition is exempt from the registration and/or qualification
requirements of the Securities Act and any applicable state securities laws, or
is otherwise made in accordance with the Securities Act and such state
securities laws. If a transfer of any Non-Registered Certificate is to be made
without registration under the Securities Act (other than in connection with the
initial issuance of the Certificates or a transfer of such Certificate by the
Depositor, the Underwriter or any of their respective Affiliates), then the
Certificate Registrar shall refuse to register such transfer unless it receives
(and, upon receipt, may conclusively rely upon) either: (i) a certificate from
the Certificateholder desiring to effect such transfer substantially in the form
attached hereto as Exhibit F-1A; or (ii) a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached hereto as Exhibit F-1B and a certificate from such Certificateholder's
prospective Transferee substantially in the form attached hereto either as
Exhibit F-2A or as Exhibit F-2B; or (iii) an Opinion of Counsel satisfactory to
the Trustee to the effect that such transfer may be made without registration
under the Securities Act (which Opinion of Counsel shall not be an expense of
the Trust or of the Depositor, the Servicer, the Special Servicer, the REMIC
Administrator, the Trustee, any Fiscal Agent or the Certificate Registrar in
their respective capacities as such), together with the written certification(s)
as to the facts surrounding such transfer from the Certificateholder desiring to
effect such transfer and/or such Certificateholder's prospective Transferee on
which such Opinion of Counsel is based. If any Transferee of a Non-Registered
Certificate or interest therein does not, in connection with the subject
transfer, deliver to the Certificate Registrar one of the certifications
described in clause(ii) of the preceding sentence or the Opinion of Counsel
described in clause (iii) of the preceding sentence, then such Transferee shall
be deemed to have represented and warranted that all the certifications set
forth in either Exhibit F-2A or Exhibit F-2B hereto are, with respect to the
subject transfer, true and correct. None of the Depositor, the Trustee or the
Certificate Registrar is obligated to register or qualify any Class of
Non-Registered Certificates under the Securities Act or any other securities law
or to take any action not otherwise required under this Agreement to permit the
transfer of any Non-Registered Certificate or interest therein without
registration or qualification. Any Certificateholder desiring to effect a
transfer, sale, pledge or other disposition of any Non-Registered Certificate or
interest therein shall, and does hereby agree to, indemnify the Depositor, the
Underwriter, the Trustee, any Fiscal
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Agent, the Servicer, the Special Servicer, the REMIC Administrator and the
Certificate Registrar against any liability that may result if such transfer,
sale, pledge or other disposition is not exempt from the registration and/or
qualification requirements of the Securities Act and any applicable state
securities laws or is not made in accordance with such federal and state laws.
(c) No transfer of a Subordinated Certificate or any interest therein shall
be made (A) to any employee benefit plan or other retirement arrangement,
including individual retirement accounts and annuities, Keogh plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested, including insurance company general accounts, that
is subject to ERISA or the Code (each, a "Plan"), or (B) to any Person who is
directly or indirectly purchasing such Certificate on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan, if the purchase and
holding of such Certificate or interest therein by the prospective Transferee
would result in a violation of Section 406 of ERISA or Section 4975 of the Code
or would result in the imposition of an excise tax under Section 4975 of the
Code. Except in connection with the initial issuance of the Subordinated
Certificates or any transfer of a Subordinated Certificate by the Depositor, the
Underwriter or any of their respective Affiliates or, in the case of a
Book-Entry Subordinated Certificate, any transfer of such Certificate to a
successor Depository or to the applicable Certificate Owner in accordance with
Section 5.03(c), the Certificate Registrar shall refuse to register the transfer
of a Subordinated Certificate unless it has received from the prospective
Transferee, either (i) a certification to the effect that such prospective
Transferee is not a Plan and is not directly or indirectly purchasing such
Certificate or interest therein on behalf of, as named fiduciary of, as trustee
of, or with assets of a Plan; or (ii) a certification to the effect that the
purchase and holding of such Certificate by such prospective Transferee is
exempt from the prohibited transaction provisions of Section 406 of ERISA and
Section 4975 of the Code under Sections I and III of Prohibited Transaction
Class Exemption 95-60; or (iii) a certification of facts and an Opinion of
Counsel (which Opinion of counsel shall not be an expense of the Trustee, the
Certificate Registrar or the Trust) which otherwise establish to the reasonable
satisfaction of the Trustee that such transfer will not result in a violation of
Section 406 of ERISA or Section 4975 of the Code or result in the imposition of
an excise tax under Section 4975 of the Code. It is hereby acknowledged that the
form of certification attached hereto as Exhibit G is acceptable for purposes of
the preceding sentence. If any Transferee of a Subordinated Certificate or any
interest therein does not, in connection with the subject transfer, deliver to
the Certificate Registrar a certification and/or Opinion of Counsel as required
by the second preceding sentence, then such Transferee shall be deemed to have
represented and warranted that either: (i) such Transferee is not a Plan and is
not directly or indirectly purchasing such Certificate or interest therein on
behalf of, as named fiduciary of, as trustee of, or with assets of a Plan; or
(ii) the purchase and holding of such Certificate or interest therein by such
Transferee is exempt from the prohibited transaction provisions of Section 406
of ERISA and Section 4975 of the Code under Sections I and III of Prohibited
Transactions Class Exemption 95-60.
(d) (i) Each Person who has or who acquires any Ownership Interest in a
Residual Interest Certificate shall be deemed by the acceptance or
acquisition of such Ownership Interest to have agreed to be bound by the
following provisions and to have irrevocably authorized the Trustee under
clause (ii) (A) below to deliver payments to a Person other than such
Person and to have irrevocably authorized the Trustee under clause (ii) (B)
below to negotiate the terms of any mandatory disposition and to execute
all instruments of Transfer and to do all other things necessary in
connection with any such disposition. The rights of each Person acquiring
any Ownership Interest in a Residual Interest Certificate are expressly
subject to the following provisions:
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(A) Each Person holding or acquiring any Ownership Interest in a
Residual Interest Certificate shall be a Permitted Transferee and
shall promptly notify the REMIC Administrator and the Trustee of any
change or impending change in its status as a Permitted Transferee.
(B) In connection with any proposed Transfer of any Ownership
Interest in a Residual Interest Certificate, the Certificate Registrar
shall require delivery to it, and shall not register the Transfer of
any Residual Interest Certificate until its receipt, of an affidavit
and agreement substantially in the form attached hereto as Exhibit H-1
(a "Transfer Affidavit and Agreement"), from the proposed Transferee,
representing and warranting, among other things, that such Transferee
is a Permitted Transferee, that it is not acquiring its Ownership
Interest in the Residual Interest Certificate that is the subject of
the proposed Transfer as a nominee, trustee or agent for any Person
that is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in a Residual Interest Certificate it will endeavor
to remain a Permitted Transferee, and that it has reviewed the
provisions of this Section 5.02(d) and agrees to be bound by them.
(C) Notwithstanding the delivery of a Transfer Affidavit and
Agreement by a proposed Transferee under clause (B) above, if a
Responsible Officer of either the Trustee or the Certificate Registrar
has actual knowledge that the proposed Transferee is not a Permitted
Transferee, no Transfer of an Ownership Interest in a Residual
Interest Certificate to such proposed Transferee shall be effected.
(D) Each Person holding or acquiring any Ownership Interest in a
Residual Interest Certificate shall agree (1) to require a Transfer
Affidavit and Agreement from any prospective Transferee to whom such
Person attempts to transfer its Ownership Interest in such Residual
Interest Certificate and (2) not to transfer its Ownership Interest in
such Residual Interest Certificate unless it provides to the
Certificate Registrar and the Trustee a certificate substantially in
the form attached hereto as Exhibit H-2 stating that, among other
things, it has no actual knowledge that such prospective Transferee is
not a Permitted Transferee.
(E) Each Person holding or acquiring an Ownership Interest in a
Residual Interest Certificate, by purchasing such Ownership Interest,
agrees to give the REMIC Administrator and the Trustee written notice
that it is a "pass-through interest holder" within the meaning of
temporary Treasury regulation Section 1.67- 3T(a)(2)(i)(A) immediately
upon acquiring an Ownership Interest in a Residual Interest
Certificate, if it is, or is holding an Ownership Interest in a
Residual Interest Certificate on behalf of, a "pass-through interest
holder".
(ii) (A) If any purported Transferee shall become a Holder of a
Residual Interest Certificate in violation of the provisions of this
Section 5.02(d), then the last preceding Holder of such Residual
Interest Certificate that was in compliance with the provisions of
this Section 5.02(d) shall be restored, to the extent permitted by
law, to all rights as Holder thereof retroactive to the date of
registration of such Transfer of such Residual Interest Certificate.
None of the Depositor, the Trustee or the
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Certificate Registrar shall be under any liability to any Person for
any registration of Transfer of a Residual Interest Certificate that
is in fact not permitted by this Section 5.02(d) or for making any
payments due on such Certificate to the Holder thereof or for taking
any other action with respect to such Holder under the provisions of
this Agreement.
(B) If any purported Transferee shall become a Holder of a
Residual Interest Certificate in violation of the restrictions in this
Section 5.02(d), then, to the extent that retroactive restoration of
the rights of the preceding Holder of such Residual Interest
Certificate as described in clause (ii) (A) above shall be invalid,
illegal or unenforceable, the Trustee shall have the right but not the
obligation, to cause the transfer of such Residual Interest
Certificate to a Permitted Transferee selected by the Trustee on such
terms as the Trustee may choose, and the Trustee shall not be liable
to any Person having an Ownership Interest in such Residual Interest
Certificate as a result of its exercise of such discretion. Such
purported Transferee shall promptly endorse and deliver such Residual
Interest Certificate in accordance with the instructions of the
Trustee. Such Permitted Transferee may be the Trustee itself or any
Affiliate of the Trustee.
(iii) The REMIC Administrator shall make available to the IRS and to
those Persons specified by the REMIC Provisions all information furnished
to it by the other parties hereto necessary to compute any tax imposed (A)
as a result of the Transfer of an Ownership Interest in a Residual Interest
Certificate to any Person who is a Disqualified Organization, including the
information described in Treasury regulations sections 1.860D-1(b)(5) and
1.860E-2(a)(5) with respect to the "excess inclusions" of such Residual
Interest Certificate and (B) as a result of any regulated investment
company, real estate investment trust, common trust fund, partnership,
trust, estate or organization described in Section 1381 of the Code that
holds an Ownership Interest in a Residual Interest Certificate having as
among its record holders at any time any Person which is a Disqualified
Organization, and each of the other parties hereto shall furnish to the
REMIC Administrator all information in its possession necessary for the
REMIC Administrator to discharge such obligation. The Person holding such
Ownership Interest shall be responsible for the reasonable compensation of
the REMIC Administrator for providing such information.
(iv) The provisions of this Section 5.02(d) set forth prior to this
clause (iv) may be modified, added to or eliminated, provided that there
shall have been delivered to the Trustee and the REMIC Administrator the
following:
(A) written confirmation from each Rating Agency to the effect
that the modification of, addition to or elimination of such
provisions will not result in an Adverse Rating Event with respect to
any Class of Rated Certificates; and
(B) an Opinion of Counsel, in form and substance satisfactory to
the Trustee and the REMIC Administrator, obtained at the expense of
the party seeking such modification of, addition to or elimination of
such provisions (but in no event at the expense of the Trustee, the
REMIC Administrator or the Trust), to the effect that doing so will
not (1) cause any REMIC Pool to cease to qualify as a REMIC or be
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subject to an entity-level tax caused by the Transfer of any Residual
Interest Certificate to a Person which is not a Permitted Transferee
or (2) cause a Person other than the prospective Transferee to be
subject to a REMIC-related tax caused by the Transfer of a Residual
Interest Certificate to a Person that is not a Permitted Transferee.
(e) If a Person is acquiring any Non-Registered Certificate, Subordinated
Certificate or Residual Interest Certificate as a fiduciary or agent for one or
more accounts, such Person shall be required to deliver to the Certificate
Registrar a certification to the effect that, and such other evidence as may be
reasonably required by the Trustee to confirm that, it has (i) sole investment
discretion with respect to each such account and (ii) full power to make the
applicable foregoing acknowledgments, representations, warranties,
certifications and/or agreements with respect to each such account as set forth
in Subsections (b), (c) and/or (d), as appropriate, of this Section 5.02.
(f) Subject to the preceding provisions of this Section 5.02, upon
surrender for registration of transfer of any Certificate at the offices of the
Certificate Registrar maintained for such purpose, the Trustee shall execute and
the Certificate Registrar shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of authorized
denominations of the same Class evidencing a like aggregate Percentage Interest.
(g) At the option of any Holder, its Certificates may be exchanged for
other Certificates of authorized denominations of the same Class evidencing a
like aggregate Percentage Interest, upon surrender of the Certificates to be
exchanged at the offices of the Certificate Registrar maintained for such
purpose. Whenever any Certificates are so surrendered for exchange, the Trustee
shall execute and the Certificate Registrar shall authenticate and deliver the
Certificates which the Certificateholder making the exchange is entitled to
receive.
(h) Every Certificate presented or surrendered for transfer or exchange
shall (if so required by the Certificate Registrar) be duly endorsed by, or be
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder thereof or his attorney duly
authorized in writing.
(i) No service charge shall be imposed for any transfer or exchange of
Certificates, but the Trustee or the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
(j) All Certificates surrendered for transfer and exchange shall be
physically cancelled by the Certificate Registrar, and the Certificate Registrar
shall dispose of such cancelled Certificates in accordance with its standard
procedures.
(k) The Certificate Registrar or the Trustee shall provide to each of the
other parties hereto, upon reasonable written request and at the expense of the
requesting party, an updated copy of the Certificate Register.
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SECTION 5.03. Book-Entry Certificates.
(a) The Class CP, Class S, Class A, Class B-1 and Class B-2 Certificates
shall, in the case of each Class thereof, initially be issued as one or more
Certificates registered in the name of the Depository or its nominee and, except
as provided in Section 5.03(c), transfer of such Certificates may not be
registered by the Certificate Registrar unless such transfer is to a successor
Depository that agrees to hold such Certificates for the respective Certificate
Owners with Ownership Interests therein. Such Certificate Owners shall hold and,
subject to Section 5.02(c), transfer their respective Ownership Interests in and
to such Certificates through the book-entry facilities of the Depository and,
except as provided in Section 5.03(c) below, shall not be entitled to fully
registered, physical Certificates ("Definitive Certificates") in respect of such
Ownership Interests. All transfers by Certificate Owners of their respective
Ownership Interests in the Book-Entry Certificates shall be made in accordance
with the procedures established by the Depository Participant or brokerage firm
representing each such Certificate Owner. Each Depository Participant shall only
transfer the Ownership Interests in the Book-Entry Certificates of Certificate
Owners it represents or of brokerage firms for which it acts as agent in
accordance with the Depository's normal procedures.
(b) The Depositor, the Servicer, the Special Servicer, the REMIC
Administrator, the Trustee, any Fiscal Agent and the Certificate Registrar may
for all purposes, including the making of payments due on the Book-Entry
Certificates, deal with the Depository as the authorized representative of the
Certificate Owners with respect to such Certificates for the purposes of
exercising the rights of Certificateholders hereunder. The rights of Certificate
Owners with respect to the Book-Entry Certificates shall be limited to those
established by law and agreements between such Certificate Owners and the
Depository Participants and brokerage firms representing such Certificate
Owners. Multiple requests and directions from, and votes of, the Depository as
Holder of the Book-Entry Certificates with respect to any particular matter
shall not be deemed inconsistent if they are made with respect to different
Certificate Owners. The Trustee may establish a reasonable record date in
connection with solicitations of consents from or voting by Certificateholders
and shall give notice to the Depository of such record date.
(c) If (i)(A) the Depositor advises the Trustee and the Certificate
Registrar in writing that the Depository is no longer willing or able to
properly discharge its responsibilities with respect to any Class of Book-Entry
Certificates, and (B) the Depositor is unable to locate a qualified successor,
or (ii) the Depositor at its option advises the Trustee and the Certificate
Registrar in writing that it elects to terminate the book-entry system through
the Depository with respect to any Class of Book-Entry Certificates (or any
portion of any Class thereof), the Certificate Registrar shall notify all
affected Certificate Owners, through the Depository, of the occurrence of any
such event and of the availability of Definitive Certificates to such
Certificate Owners requesting the same. Upon surrender to the Certificate
Registrar of any Class of Book-Entry Certificates (or any portion of any Class
thereof) by the Depository, accompanied by registration instructions from the
Depository for registration of transfer, the Trustee shall execute, and the
Certificate Registrar shall authenticate and deliver, the Definitive
Certificates in respect of such Class (or portion thereof) to the Certificate
Owners identified in such instructions. None of the Depositor, the Servicer, the
Special Servicer, the REMIC Administrator, the Trustee or the Certificate
Registrar shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates for purposes of evidencing
ownership of any Book-Entry Certificates, the registered holders of such
Definitive Certificates shall be recognized as Certificateholders hereunder and,
accordingly, shall be entitled directly to receive payments on, to exercise
Voting Rights with respect to, and to transfer and exchange such Definitive
Certificates.
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SECTION 5.04. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate, and (ii) there is delivered
to the Trustee and the Certificate Registrar such security or indemnity as may
be reasonably required by them to save each of them harmless, then, in the
absence of actual notice to the Trustee or the Certificate Registrar that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute and the Certificate Registrar shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of the same Class and like Percentage Interest.
Upon the issuance of any new Certificate under this Section, the Trustee and the
Certificate Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other reasonable expenses (including the reasonable fees and expenses of the
Trustee and the Certificate Registrar) connected therewith. Any replacement
Certificate issued pursuant to this Section shall constitute complete and
indefeasible evidence of ownership in the applicable REMIC Pool, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
SECTION 5.05. Persons Deemed Owners.
Prior to due presentment for registration of transfer, the Depositor, the
Servicer, the Special Servicer, the REMIC Administrator, the Trustee, any Fiscal
Agent, the Certificate Registrar and any agent of any of them may treat the
person in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section 4.01
and for all other purposes whatsoever, and none of the Depositor, the Servicer,
the Special Servicer, the REMIC Administrator, the Trustee, any Fiscal Agent,
the Certificate Registrar or any agent of any of them shall be affected by
notice to the contrary.
SECTION 5.06. Certification by Certificate Owners.
(a) Each Certificate Owner is hereby deemed by virtue of its acquisition of
an Ownership Interest in the Book-Entry Certificates to agree to comply with the
transfer requirements of Section 5.02(c).
(b) To the extent that under the terms of this Agreement, it is necessary
to determine whether any Person is a Certificate Owner, the Trustee shall make
such determination based on a certificate of such Person which shall specify, in
reasonable detail satisfactory to the Trustee, the Class and Certificate
Principal Balance or Certificate Notional Amount, as the case may be, of the
Book-Entry Certificate beneficially owned, the value of such Person's interest
in such Certificate and any intermediaries through which such Person's Ownership
Interest in such Book-Entry Certificate is held; provided, however, that the
Trustee shall not knowingly recognize such Person as a Certificate Owner if such
Person, to the knowledge of a Responsible Officer of the Trustee, acquired its
Ownership Interest in a Book-Entry Certificate in violation of Section 5.02(c),
or if such Person's certification that it is a Certificate Owner is in direct
conflict with information obtained by the Trustee from the Depository, a
Depository Participant and/or an indirect participating brokerage firm for which
a Depository Participant acts as agent, with respect to the identity of a
Certificate Owner. The Trustee shall exercise its reasonable discretion in
making any determination under this Section 5.06(b) and shall afford any Person
providing information with respect to its beneficial ownership of any Book-Entry
Certificate an opportunity to resolve any discrepancies between the information
provided and any other information available to the Trustee.
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SECTION 5.07. Required Regulatory Repurchase.
Notwithstanding any other provisions of this Agreement, if the CCC or any
other applicable Gaming Authority does not waive the qualification requirements
as to any Holder or beneficial owner of a Certificate and requires that such
Person be qualified under the Control Act, then, in such event, such Person
shall be required to qualify under the Control Act. If such Holder or beneficial
owner thereafter fails to so qualify or if such Holder or beneficial owner is
otherwise found by the CCC or any other applicable Gaming Authority to not be
suitable to hold, directly or indirectly, Certificates or interests therein,
then such Holder or beneficial owner shall be required to promptly dispose of
its Certificates or interests therein. If any such non-qualified Person does not
so dispose of its Certificates or interests therein, the Depositor is hereby
authorized to sell such Certificates or interest therein on behalf of such
non-qualified Person and to deliver thereto the proceeds of such sale. If, in
connection therewith, any such non-qualified Person does not tender its
Certificates to the purchaser thereof, together with the appropriate transfer
documents, then the Trustee, at the written direction of the Depositor, shall
cancel such Certificates and shall execute, authenticate and deliver to such
purchaser new Certificates of the same Class in authorized denominations
representing the same aggregate Percentage Interest.
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ARTICLE VI
THE DEPOSITOR, THE SERVICER,
THE SPECIAL SERVICER AND THE REMIC ADMINISTRATOR
SECTION 6.01. Liability of the Depositor, the Servicer, the Special
Servicer and the REMIC Administrator.
The Depositor, the Servicer, the Special Servicer and the REMIC
Administrator shall be liable in accordance herewith only to the extent of the
respective obligations specifically imposed upon and undertaken by the
Depositor, the Servicer, the Special Servicer and the REMIC Administrator
herein.
SECTION 6.02. Merger, Consolidation or Conversion of the Depositor, the
Servicer, the Special Servicer or the REMIC Administrator.
Subject to the following paragraph, the Depositor, the Servicer, the
Special Servicer and the REMIC Administrator shall each keep in full effect its
existence, rights and franchises as a corporation, bank, trust company,
partnership, limited liability company or association under the laws of the
jurisdiction wherein it was organized, and each shall obtain and preserve its
qualification to do business as a foreign entity in each jurisdiction in which
such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.
The Depositor, the Servicer, the Special Servicer or the REMIC
Administrator may be merged or consolidated with or into any Person, or transfer
all or substantially all of its assets to any Person, in which case, without
limiting its rights to resign set forth in Section 6.04, any Person resulting
from any merger or consolidation to which the Depositor, the Servicer, the
Special Servicer or the REMIC Administrator shall be a party, or any Person
succeeding to the business of the Depositor, the Servicer, the Special Servicer
or the REMIC Administrator, shall be the successor of the Depositor, the
Servicer, the Special Servicer or the REMIC Administrator, as the case may be,
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; provided, however, that no successor or surviving Person shall
succeed to the rights of the Servicer or the Special Servicer unless such
succession will not result in an Adverse Rating Event with respect to any Class
of Rated Certificates (as confirmed in writing to the Trustee by each Rating
Agency).
SECTION 6.03. Limitation on Liability of the Depositor, the Servicer, the
Special Servicer and the REMIC Administrator.
None of the Depositor, the Servicer, the Special Servicer or the REMIC
Administrator shall be under any liability to the Trust, the Trustee or the
Certificateholders for any action taken or not taken in good faith pursuant to
this Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Depositor, the Servicer, the Special Servicer or
the REMIC Administrator against any liability to the Trust, the Trustee or the
Certificateholders for the breach of a representation or warranty made by such
party herein, or against any expense or liability specifically required to be
borne by such party without right of reimbursement pursuant to the terms hereof,
or against any liability which would otherwise be imposed by reason of
misfeasance, bad faith or negligence in the performance of, or reckless
disregard of, such party's
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obligations or duties hereunder. The Depositor, the Servicer, the Special
Servicer, the REMIC Administrator and any director, manager, member, officer,
employee or agent of any such party may rely in good faith on any document of
any kind which, prima facie, is properly executed and submitted by any Person
respecting any matters arising hereunder. The Depositor, the Servicer, the
Special Servicer, the REMIC Administrator and any director, manager, member,
officer, employee or agent of any such party shall be indemnified and held
harmless by the Trust out of the Collection Account against any loss, liability,
cost or expense (including reasonable legal expenses) incurred in connection
with any legal action relating to this Agreement or the Certificates, other than
any loss, liability, cost or expense: (i) specifically required to be borne
thereby pursuant to the terms hereof or otherwise incidental to the performance
of obligations and duties hereunder, including, in the case of the Servicer or
Special Servicer, the prosecution of an enforcement action in respect of any
specific Mortgage Loan or Mortgage Loans (except as any such loss, liability or
expense shall be otherwise reimbursable pursuant to this Agreement); or (ii)
incurred in connection with any legal action against such party resulting from
any breach of a representation, warranty or covenant made herein, any
misfeasance, bad faith or negligence in the performance of, or reckless
disregard of, obligations or duties hereunder or any willful or negligent
violation of applicable law. None of the Depositor, the Servicer, the Special
Servicer or the REMIC Administrator shall be under any obligation to appear in,
prosecute or defend any legal action unless such action is related to its
respective duties under this Agreement and, except in the case of a legal action
the costs of which it is specifically required hereunder to bear, in its opinion
does not involve it in any ultimate expense or liability; provided, however,
that the Depositor, the Servicer, the Special Servicer or the REMIC
Administrator may in its discretion undertake any such action which it may
reasonably deem necessary or desirable with respect to the enforcement and/or
protection of the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder. In such event, the legal expenses and costs of
such action, and any liability resulting therefrom, shall be expenses, costs and
liabilities of the Trust, and the Depositor, the Servicer, the Special Servicer
and the REMIC Administrator shall be entitled to be reimbursed therefor from the
Collection Account as provided in Section 3.05(a).
SECTION 6.04. Servicer, Special Servicer and REMIC Administrator Not to
Resign.
The Servicer and the Special Servicer may each resign from the obligations
and duties hereby imposed on it, upon a determination that its 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 (the other
activities of the Servicer or the Special Servicer, as the case may be, so
causing such a conflict being of a type and nature carried on by the Servicer or
the Special Servicer, as the case may be, at the date of this Agreement). Any
such determination requiring the resignation of the Servicer or the Special
Servicer, as applicable, shall be evidenced by an Opinion of Counsel to such
effect which shall be delivered to the Trustee. Unless applicable law requires
the Servicer's or Special Servicer's resignation to be effective immediately,
and the Opinion of Counsel delivered pursuant to the prior sentence so states,
no such resignation shall become effective until the Trustee or other successor
shall have assumed the responsibilities and obligations of the resigning party
in accordance with Section 6.06 or Section 7.02 hereof; provided that, if no
successor servicer or special servicer, as applicable, shall have been so
appointed and have accepted appointment within 90 days after the Servicer or
Special Servicer, as the case may be, has given notice of such resignation, the
resigning Servicer or Special Servicer, as applicable, may petition any court of
competent jurisdiction for the appointment of a successor servicer or special
servicer, as applicable. In addition, the Servicer and the Special Servicer
shall each have the right to resign at any other time provided that (i) a
willing successor thereto (including any such successor proposed by the
resigning party) acceptable to the Depositor has been found , (ii) each of the
Rating Agencies confirms in writing that the successor's appointment will not
result in an Adverse Rating Event with respect to any Class of Rated
Certificates, (iii) the resigning party pays all
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costs and expenses in connection with such transfer, and (iv) the successor
accepts appointment prior to the effectiveness of such resignation. Neither the
Servicer nor the Special Servicer shall be permitted to resign except as
contemplated above in this Section 6.04.
Consistent with the foregoing, none of the Servicer, the Special Servicer
or the REMIC Administrator shall (except in connection with any resignation
thereby permitted pursuant to the next to last sentence of the prior paragraph
or as otherwise expressly provided herein) assign or transfer any of its rights,
benefits or privileges hereunder to any other Person or delegate to, subcontract
with, or authorize or appoint any other Person to perform any of the duties,
covenants or obligations to be performed by it hereunder. If, pursuant to any
provision hereof, the duties of the Servicer, the Special Servicer or the REMIC
Administrator are transferred to a successor thereto, the entire amount of
compensation payable to the Servicer, the Special Servicer or the REMIC
Administrator, as the case may be, that accrues pursuant hereto from and after
the date of such transfer shall be payable to such successor.
Notwithstanding the foregoing, if the same Person is acting as both REMIC
Administrator and Trustee, and such Person resigns as Trustee pursuant to
Section 8.07, then such Person shall be deemed to have also resigned as the
REMIC Administrator, and the successor Trustee shall also act as successor REMIC
Administrator or shall appoint a successor REMIC Administrator whose appointment
will not (as confirmed in writing to the Trustee by each Rating Agency) result
in an Adverse Rating Event with respect to any Class of Rated Certificates.
SECTION 6.05. Rights of the Depositor and the Trustee in Respect of the
Servicer, the Special Servicer and the REMIC Administrator.
The Servicer, the Special Servicer and the REMIC Administrator shall each
afford the Depositor, the Trustee, the Controlling Class Representative and each
Rating Agency, upon reasonable notice, during normal business hours access to
all records maintained by it in respect of its rights and obligations hereunder
and access to such of its officers as are responsible for such obligations. Upon
reasonable request, the Servicer, the Special Servicer and the REMIC
Administrator shall each furnish the Depositor, the Trustee and each Rating
Agency with its most recent financial statements and such other information as
it possesses, and which it is not prohibited by applicable law or contract from
disclosing, regarding its business, affairs, property and condition, financial
or otherwise; provided that none of the Depositor or the Trustee may disclose
the contents of such financial statements or other information to non-affiliated
third parties (other than accountants, attorneys, financial advisors and other
representatives retained to help it evaluate such financial statements or other
information), unless it is required to do so under applicable securities laws or
is otherwise compelled to do so as a matter of law. The Servicer, the Special
Servicer and the REMIC Administrator may each affix to any such information
described in this Section 6.05 provided by it any disclaimer it deems
appropriate in its reasonable discretion. The Depositor may, but is not
obligated to, enforce the obligations of the Servicer, the Special Servicer and
the REMIC Administrator hereunder and may, but is not obligated to, perform, or
cause a designee to perform, any defaulted obligation of the Servicer, the
Special Servicer or the REMIC Administrator hereunder or exercise the rights of
the Servicer, the Special Servicer or the REMIC Administrator hereunder;
provided, however, that none of the Servicer, the Special Servicer or the REMIC
Administrator shall be relieved of any of its obligations hereunder by virtue of
such performance by the Depositor or its designee. The Depositor shall not have
any responsibility or liability for any action or failure to act by the
Servicer, the Special Servicer or the REMIC Administrator and is not obligated
to supervise the performance of the Servicer, the Special Servicer or the REMIC
Administrator under this Agreement or otherwise.
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SECTION 6.06. Designation of Special Servicer by the Controlling Class.
The Holder or Holders of the Certificates evidencing a majority of the
Voting Rights allocated to the Controlling Class may at any time and from time
to time designate a Person to replace any existing Special Servicer or any
Special Servicer that has resigned or otherwise ceased to serve as Special
Servicer. Such Holder or Holders shall so designate a Person to so serve by the
delivery to the Trustee and the existing Special Servicer of a written notice
stating such designation. The Trustee shall, promptly after receiving any such
notice, deliver to the Rating Agencies an executed Notice and Acknowledgment in
the form attached hereto as Exhibit I-1. The designated Person shall become the
Special Servicer on the date as of which the Trustee shall have received: (i)
written confirmation from each of the Rating Agencies that the appointment of
such Person will not result in an Adverse Rating Event with respect to any Class
of Rated Certificates; (ii) an Acknowledgment of Proposed Special Servicer in
the form attached hereto as Exhibit I-2, executed by the designated Person; and
(iii) an Opinion of Counsel (which shall not be an expense of the Trustee or the
Trust) substantially to the effect that (A) the designation of such Person to
serve as Special Servicer is in compliance with this Section 6.06 and all other
applicable provisions of this Agreement, (B) the designated Person is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (C) the Acknowledgment of Proposed Special
Servicer has been duly authorized, executed and delivered by the designated
Person and (D) upon the execution and delivery of the Acknowledgment of Proposed
Special Servicer, the designated Person shall be bound by the terms of this
Agreement and, subject to customary bankruptcy and insolvency exceptions, that
this Agreement shall be enforceable against the designated Person in accordance
with its terms. Any existing Special Servicer shall be deemed to have been
terminated simultaneously with such designated Person's becoming the Special
Servicer hereunder; provided, however, that the terminated Special Servicer
shall continue to be obligated to pay and entitled to receive all amounts
accrued or owing by or to it under this Agreement on or prior to the effective
date of such termination, whether in respect of Servicing Advances or otherwise,
and it and its directors, officers, employees and agents shall continue to be
entitled to the benefits of Section 6.03 notwithstanding any such termination.
Such terminated Special Servicer shall cooperate with the Trustee and the
replacement Special Servicer in effecting the transfer of the terminated Special
Servicer's responsibilities and rights hereunder to its successor, including the
transfer within two Business Days to the replacement Special Servicer for
administration by it of all cash amounts that at the time are or should have
been credited by the Special Servicer to the REO Account or any Servicing
Account or should have been delivered to the Servicer or that are thereafter
received by or on behalf of it with respect to any Mortgage Loan or REO
Property. If the termination of the Special Servicer was without cause, the
costs and expenses of any such transfer shall in no event be paid out of the
Trust Fund, and instead shall be paid by the successor Special Servicer or the
Holders of the Controlling Class that voted to remove the Special Servicer, as
such parties may agree.
SECTION 6.07. Servicer or Special Servicer as Owner of a Certificate.
If, at any time during which the Servicer or the Special Servicer or an
Affiliate of the Servicer or the Special Servicer is the Holder of (or, in the
case of a Book-Entry Certificate, Certificate Owner with respect to) any
Certificate, the Servicer or the Special Servicer proposes to take any action
(including for this purpose, omitting to take a particular action) that is not
expressly prohibited by the terms hereof and would not, in the Servicer's or the
Special Servicer's reasonable, good faith judgment, violate the Servicing
Standard, but that, if taken, might nonetheless, in the Servicer's or the
Special Servicer's reasonable, good faith judgment, be considered by other
Persons to violate the Servicing Standard, then the Servicer or the Special
Servicer may (but need not) seek the approval of the Certificateholders to such
action by delivering to the Trustee a written notice that (a) states that it is
delivered pursuant to this Section 6.07, (b) identifies the
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Percentage Interest in each Class of Certificates beneficially owned by the
Servicer or the Special Servicer, as the case may be, or by an Affiliate thereof
and (c) describes in reasonable detail the action that the Servicer or the
Special Servicer, as the case may be, proposes to take. The Trustee, upon
receipt of such notice, shall forward it to the Certificateholders (other than
the Servicer and its Affiliates or the Special Servicer and its Affiliates, as
appropriate), together with a request for approval by the Certificateholders of
each such proposed action. If at any time Certificateholders holding greater
than 50% of the Voting Rights of all Certificateholders (calculated without
regard to the Certificates beneficially owned by the Servicer or its Affiliates
or the Special Servicer or its Affiliates, as the case may be) shall have
consented in writing to the proposal described in the written notice, and if the
Servicer or the Special Servicer, as the case may be, shall act as proposed in
the written notice, such action shall be deemed to comply with the Servicing
Standard. The Trustee shall be entitled to reimbursement from the Servicer or
the Special Servicer, as applicable, for the reasonable expenses of the Trustee
incurred pursuant to this paragraph. It is not the intent of the foregoing
provision that the Servicer or the Special Servicer be permitted to invoke the
procedure set forth herein with respect to routine servicing matters arising
hereunder, but rather in the case of unusual circumstances.
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ARTICLE VII
DEFAULT
SECTION 7.01. Events of Default.
(a) "Event of Default", wherever used herein, means any one of the
following events:
(i) any failure by the Servicer to deposit into the Collection Account
any amount required to be so deposited under this Agreement, which failure
continues unremedied for one Business Day following the date on which such
deposit was first required to be made; or
(ii) any failure by the Special Servicer to deposit into the REO
Account or the Collection Account, or to remit to the Servicer for deposit
into the Collection Account, any amount required to be so deposited or
remitted under this Agreement, which failure continues unremedied for one
Business Day following the date on which such deposit or remittance, as the
case may be, was first required to be made; or
(iii) any failure by the Servicer to remit to the Trustee for deposit
into the Distribution Account, on any P&I Advance Date, the full amount of
P&I Advances required to be made on such date or, on any Servicer
Remittance Date, the full amount of the Servicer Remittance Amount required
to be remitted on such date, which failure continues unremedied until 5:00
p.m. (New York City time) on such P&I Advance Date or Servicer Remittance
Date, as the case may be; or
(iv) any failure by the Servicer to timely make any Servicing Advance
required to be made by it hereunder, which Servicing Advance remains unmade
for a period of three Business Days following the date on which notice
shall have been given to the Servicer by the Trustee as provided in Section
3.11(f); or
(v) any failure by the Special Servicer to timely make (or request the
Servicer to make) any Servicing Advance required to be made by it
hereunder, which Servicing Advance remains unmade for a period of three
Business Days following the date on which notice has been given to the
Special Servicer by the Trustee as provided in Section 3.11(f); or
(vi) any failure on the part of the Servicer or the Special Servicer
duly to observe or perform in any material respect any other of the
covenants or agreements on the part of the Servicer or the Special
Servicer, as the case may be, contained in this Agreement, which failure
continues unremedied for a period of 30 days (or, in the case of payment of
insurance premiums, for a period of 15 days) after the date on which
written notice of such failure, requiring the same to be remedied, shall
have been given to the Servicer or the Special Servicer, as the case may
be, by any other party hereto or to the Servicer or the Special Servicer,
as the case may be, (with a copy to each other party hereto) by the Holders
of Certificates entitled to at least 25% of the Voting Rights; or
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(vii) any failure on the part of the REMIC Administrator duly to
observe or perform in any material respect any of the covenants or
agreements on the part of the REMIC Administrator contained in this
Agreement which continues unremedied for a period of 60 days after the date
on which written notice of such failure, requiring the same to be remedied,
shall have been given to the REMIC Administrator by any other party hereto,
or to the REMIC Administrator (with a copy to each other party hereto) by
the Holders of Certificates entitled to at least 25% of the Voting Rights;
or
(viii) any breach on the part of the Servicer or the Special Servicer
of any representation or warranty contained in this Agreement that
materially and adversely affects the interests of any Class of
Certificateholders and which continues unremedied for a period of 60 days
after the date on which notice of such breach, requiring the same to be
remedied, shall have been given to the Servicer or the Special Servicer, as
the case may be, by any other party hereto or to the Servicer or the
Special Servicer, as the case may be, (with a copy to each other party
hereto) by the Holders of Certificates entitled to at least 25% of the
Voting Rights; or
(ix) any breach on the part of the REMIC Administrator of any
representation or warranty contained in this Agreement that materially and
adversely affects the interests of any Class of Certificateholders and
which continues unremedied for a period of 30 days after the date on which
notice of such breach, requiring the same to be remedied, shall have been
given to the REMIC Administrator by any other party hereto or to the REMIC
Administrator (with a copy to each other party hereto) by the Holders of
Certificates entitled to at least 25% of the Voting Rights; or
(x) a decree or order of a court or agency or supervisory authority
having jurisdiction in the premises in an involuntary case under any
present or future federal or state bankruptcy, insolvency or similar law
for the appointment of a conservator, receiver, liquidator, trustee or
similar official in any bankruptcy, insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered against
the Servicer, the Special Servicer or the REMIC Administrator and such
decree or order shall have remained in force undischarged or unstayed for a
period of 60 days; or
(xi) the Servicer, the Special Servicer or the REMIC Administrator
shall consent to the appointment of a conservator, receiver, liquidator,
trustee or similar official in any bankruptcy, insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceedings of or
relating to it or of or relating to all or substantially all of its
property; or
(xii) the Servicer, the Special Servicer or the REMIC Administrator
shall admit in writing its inability to pay its debts generally as they
become due, file a petition to take advantage of any applicable bankruptcy,
insolvency or reorganization statute, make an assignment for the benefit of
its creditors, voluntarily suspend payment of its obligations, or take any
corporate action in furtherance of the foregoing; or
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(xiii) the Servicer's or the Special Servicer's acting in such
capacity shall have resulted in an Adverse Rating Event with respect to any
Class of Rated Certificates, or the Trustee shall have received written
notice from any Rating Agency that the Servicer's or the Special Servicer's
continuing to act in such capacity shall result in an Adverse Rating Event
with respect to any Class of Rated Certificates.
When a single entity acts as Servicer, Special Servicer and REMIC Administrator,
or in any two of the foregoing capacities, an Event of Default (other than an
event described in clause (xiii) above) in one capacity shall constitute an
Event of Default in each such capacity.
(b) If any Event of Default with respect to the Servicer or the Special
Servicer (in either case, for purposes of this Section 7.01(b), the "Defaulting
Party") shall occur and be continuing, then, and in each and every such case, so
long as the Event of Default shall not have been remedied, the Depositor and the
Trustee each may, and at the written direction of the Holders of Certificates
entitled to not less than 25% of the Voting Rights or if the relevant Event of
Default is one described in any of clauses (iii) and (x) through (xiii) of
Section 7.01(a), the Trustee shall (subject to applicable bankruptcy or
insolvency law in the case of clauses (x) through (xii) of Section 7.01(a)),
terminate, by notice in writing to the Defaulting Party (with a copy of such
notice to each other party hereto), all of the rights and obligations (accruing
from and after such notice) of the Defaulting Party under this Agreement and in
and to the Trust Fund (other than as a Holder of any Certificate). From and
after the receipt by the Defaulting Party of such written notice, all authority
and power of the Defaulting Party under this Agreement, whether with respect to
the Certificates (other than as a Holder of any Certificate) or the Mortgage
Loans or otherwise, shall pass to and be vested in the Trustee pursuant to and
under this Section, and, without limitation, the Trustee is hereby authorized
and empowered to execute and deliver, on behalf of and at the expense of the
Defaulting Party, 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 or assignment of the Mortgage Loans and
related documents, or otherwise. Each of the Servicer and the Special Servicer
agrees that, if it is terminated pursuant to this Section 7.01(b), it shall
promptly (and in any event no later than ten Business Days subsequent to its
receipt of the notice of termination) provide the Trustee with all documents and
records requested thereby to enable the Trustee to assume the Servicer's or
Special Servicer's, as the case may be, functions hereunder, and shall otherwise
cooperate with the Trustee in effecting the termination of the Servicer's or
Special Servicer's, as the case may be, responsibilities and rights hereunder,
including the transfer within two Business Days to the Trustee for
administration by it of all cash amounts that at the time are or should have
been credited by the Servicer to the Collection Account, the Distribution
Account or any Servicing Account (if it is the Defaulting Party) or by the
Special Servicer to the REO Account, the Collection Account or any Servicing
Account (if it is the Defaulting Party) or that are thereafter received by or on
behalf of it with respect to any Mortgage Loan or REO Property (provided,
however, that the Servicer and the Special Servicer each shall, if terminated
pursuant to this Section 7.01(b), continue to be obligated to pay and entitled
to receive all amounts accrued or owing by or to it under this Agreement on or
prior to the date of such termination, whether in respect of Advances or
otherwise, and it and its directors, officers, employees and agents shall
continue to be entitled to the benefits of Section 6.03 notwithstanding any such
termination). Any costs or expenses (including those of any other party hereto)
incurred in connection with any actions to be taken by the Servicer or Special
Servicer pursuant to this paragraph shall be borne by the Servicer or Special
Servicer, as the case may be (and, in the case of the Trustee's costs and
expenses, if not paid within a reasonable time, shall be borne by the Trust out
of the Collection Account).
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(c) If any Event of Default with respect to the REMIC Administrator shall
occur and be continuing, then, and in each and every such case, so long as the
Event of Default shall not have been remedied, the Depositor or the Trustee may,
and at the written direction of the Holders of Certificates entitled to not less
than a majority of the Voting Rights, the Trustee (or, if the Trustee is also
the REMIC Administrator, the Servicer) shall, terminate, by notice in writing to
the REMIC Administrator (with a copy to each of the other parties hereto), all
of the rights and obligations of the REMIC Administrator under this Agreement.
From and after the receipt by the REMIC Administrator of such written notice
(or, if the Trustee is also the REMIC Administrator, from and after such time as
another successor appointed as contemplated by Section 7.02 accepts such
appointment), all authority and power of the REMIC Administrator under this
Agreement shall pass to and be vested in the Trustee (or such other successor)
pursuant to and under this Section, and, without limitation, the Trustee (or
such other successor) is hereby authorized and empowered to execute and deliver,
on behalf of and at the expense of the REMIC Administrator, 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. The REMIC Administrator agrees promptly
(and in any event no later than ten Business Days subsequent to its receipt of
the notice of the termination) to provide the Trustee (or, if the Trustee is
also the REMIC Administrator, such other successor appointed as contemplated by
Section 7.02) with all documents and records requested thereby to enable the
Trustee (or such other successor) to assume the REMIC Administrator's functions
hereunder, and to cooperate with the Trustee (or such other successor) in
effecting the termination of the REMIC Administrator's responsibilities and
rights hereunder (provided, however, that the REMIC Administrator shall continue
to be obligated to pay and entitled to receive all amounts accrued or owing by
or to it under this Agreement on or prior to the date of such termination, and
it and its directors, officers, employees and agents shall continue to be
entitled to the benefits of Section 6.03 notwithstanding any such termination).
Any costs or expenses (including those of any other party hereto) incurred in
connection with any actions to be taken by the REMIC Administrator pursuant to
this paragraph shall be borne by the REMIC Administrator.
SECTION 7.02. Trustee to Act; Appointment of Successor.
On and after the time the Servicer, the Special Servicer or the REMIC
Administrator resigns pursuant to the first paragraph of Section 6.04 or
receives a notice of termination pursuant to Section 7.01, the Trustee shall be
the successor in all respects to the Servicer, the Special Servicer or (unless
it had also been acting as such) the REMIC Administrator, as the case may be, in
its capacity as such under this Agreement and the transactions set forth or
provided for herein and shall be subject to all the responsibilities, duties and
liabilities relating thereto and arising thereafter placed on the Servicer, the
Special Servicer or the REMIC Administrator, as the case may be, by the terms
and provisions hereof, including, if the Servicer is the resigning or terminated
party, the Servicer's obligation to make P&I Advances; provided, however, that
any failure to perform such duties or responsibilities caused by the Servicer's,
the Special Servicer's or the REMIC Administrator's, as the case may be, failure
to cooperate or to provide information or monies as required by Section 7.01
shall not be considered a default by the Trustee hereunder; and provided,
further, that, in the case of a resigning or terminated Special Servicer, the
Trustee shall not so act as successor if an alternative successor is earlier
appointed pursuant to Section 6.06. Neither the Trustee nor any other successor
shall be liable for any of the representations and warranties of the resigning
or terminated party or for any losses incurred by the resigning or terminated
party pursuant to Section 3.06 hereunder nor shall the Trustee nor any other
successor be required to purchase any Mortgage Loan hereunder. As compensation
therefor, the Trustee shall be entitled to all fees and other compensation which
the resigning or terminated party would have been entitled to for future
services rendered if the resigning or terminated party had continued to act
hereunder. Notwithstanding the above, if it is unwilling to so act, the Trustee
may (and, if
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it is unable to so act, or if the Servicer or the Special Servicer is the
resigning or terminated party and the Trustee is not approved as an acceptable
servicer or special servicer, as the case may be, by each Rating Agency, or if
the REMIC Administrator is the resigning or terminated party and the Trustee had
been acting in such capacity, or if the Holders of Certificates entitled to a
majority of all the Voting Rights so request in writing, the Trustee shall)
promptly appoint, or petition a court of competent jurisdiction to appoint, any
established and qualified institution as the successor to the Servicer, the
Special Servicer or the REMIC Administrator, as the case may be, hereunder in
the assumption of all or any part of the responsibilities, duties or liabilities
of the Servicer, the Special Servicer or the REMIC Administrator, as the case
may be, hereunder; provided, however, that such appointment does not result in
an Adverse Rating Event with respect to any Class of Rated Certificates (as
confirmed in writing to the Trustee by each Rating Agency). No appointment of a
successor to the Servicer, the Special Servicer or the REMIC Administrator
hereunder shall be effective until the assumption by such successor of all its
responsibilities, duties and liabilities hereunder, and pending such appointment
and assumption, the Trustee shall act in such capacity as hereinabove provided.
In connection with any such appointment and assumption, the Trustee may make
such arrangements for the compensation of such successor out of payments on the
Mortgage Loans or otherwise as it and such successor shall agree; provided,
however, that no such compensation shall be in excess of that permitted the
resigning or terminated party hereunder. The Depositor, the Trustee, such
successor and each other party hereto shall take such action, consistent with
this Agreement, as shall be necessary to effectuate any such succession.
SECTION 7.03. Notification to Certificateholders.
(a) Upon any resignation of the Servicer, the Special Servicer or the REMIC
Administrator pursuant to Section 6.04, any termination of the Servicer, the
Special Servicer or the REMIC Administrator pursuant to Section 7.01, any
appointment of a successor to the Servicer, the Special Servicer or the REMIC
Administrator pursuant to Section 6.04 or 7.02 or the effectiveness of any
designation of a new Special Servicer pursuant to Section 6.06, the Trustee
shall give prompt written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register.
(b) Not later than the later of (i) 60 days after the occurrence of any
event which constitutes or, with notice or lapse of time or both, would
constitute an Event of Default and (ii) five days after a Responsible Officer of
the Trustee has actual notice of the occurrence of such an event, the Trustee
shall transmit by mail to the Depositor and all Certificateholders notice of
such occurrence, unless such default shall have been cured.
SECTION 7.04. Waiver of Events of Default.
The Holders of Certificates representing at least 66-2/3% of the Voting
Rights allocated to each Class of Certificates affected by any Event of Default
hereunder may waive such Event of Default; provided, however, that an Event of
Default under clause (i), clause (ii) , clause (iii) or clause (xiii) of Section
7.01(a) may be waived only by all of the Certificateholders of the affected
Classes. Upon any such waiver of an Event of Default, such Event of Default
shall cease to exist and shall be deemed to have been remedied for every purpose
hereunder. No such waiver shall extend to any subsequent or other Event of
Default or impair any right consequent thereon except to the extent expressly so
waived. Notwithstanding any other provisions of this Agreement, for purposes of
waiving any Event of Default pursuant to this Section 7.04, Certificates
registered in the name of the Depositor or any Affiliate of the Depositor shall
be entitled to the
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same Voting Rights with respect to the matters described above as they would if
registered in the name of any other Person.
SECTION 7.05. Additional Remedies of Trustee Upon Event of Default.
During the continuance of any Event of Default, so long as such Event of
Default shall not have been remedied, the Trustee, in addition to the rights
specified in Section 7.01, shall have the right (exercisable subject to Section
8.01(a)), in its own name and as trustee of an express trust, to take all
actions now or hereafter existing at law, in equity or by statute to enforce its
rights and remedies and to protect the interests, and enforce the rights and
remedies, of the Certificateholders (including the institution and prosecution
of all judicial, administrative and other proceedings and the filings of proofs
of claim and debt in connection therewith). Except as otherwise expressly
provided in this Agreement, no remedy provided for by this Agreement shall be
exclusive of any other remedy, and each and every remedy shall be cumulative and
in addition to any other remedy, and no delay or omission to exercise any right
or remedy shall impair any such right or remedy or shall be deemed to be a
waiver of any Event of Default.
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ARTICLE VIII
THE TRUSTEE
SECTION 8.01. Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default and after
the curing or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If an Event of Default occurs and is continuing, then
the Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs. Any permissive right of the Trustee contained in this Agreement
shall not be construed as a duty.
(b) Upon receipt of all resolutions, certificates, statements, opinions,
reports, documents, orders or other instruments furnished to the Trustee which
are specifically required to be furnished pursuant to any provision of this
Agreement (other than the Mortgage Files, the review of which is specifically
governed by the terms of Article II), the Trustee shall examine them to
determine whether they conform to the requirements of this Agreement. If any
such instrument is found not to conform to the requirements of this Agreement in
a material manner, the Trustee shall make a request to the responsible party to
have the instrument corrected. The Trustee shall not be responsible for the
accuracy or content of any resolution, certificate, statement, opinion, report,
document, order or other instrument furnished by any other party hereto, and
accepted by the Trustee in good faith, pursuant to this Agreement.
(c) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after the
curing or waiver of all Events of Default which may have occurred, the
duties and obligations of the Trustee shall be determined solely by the
express provisions of this Agreement, the Trustee shall not be liable
except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee and, in
the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or opinions furnished
to the Trustee and conforming to the requirements of this Agreement.
(ii) The Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts.
(iii) The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Holders of Certificates entitled to at
least 25% (or, as to any particular matter, any higher percentage as may be
specifically provided for hereunder) of the Voting Rights relating to the
time,
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method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred upon the Trustee,
under this Agreement.
(iv) The Trustee shall not be required to take action with respect to,
or be deemed to have notice or knowledge of, any default or Event of
Default (except an Event of Default under Section 7.01(a)(xiii) or the
Servicer's failure to deliver any monies, including P&I Advances, or to
provide any report, certificate or statement to the Trustee when required
pursuant to this Agreement) unless a Responsible Officer of the Trustee
shall have received written notice or otherwise have actual knowledge
thereof. Otherwise, the Trustee may conclusively assume that there is no
such default or Event of Default.
(v) Subject to the other provisions of this Agreement and without
limiting the generality of this Section 8.01, the Trustee shall have no
duty except in the capacity as successor Servicer or successor Special
Servicer (A) to see to any recording, filing, or depositing of this
Agreement or any agreement referred to herein or any financing statement or
continuation statement evidencing a security interest, or to see to the
maintenance of any such recording or filing or depositing or to any
rerecording, refiling or redepositing of any thereof, (B) to see to the
maintenance of any insurance, and (C) to confirm or verify the contents of
any reports or certificates of the Servicer or Special Servicer delivered
to the Trustee pursuant to this Agreement reasonably believed by the
Trustee to be genuine and without error and to have been signed or
presented by the proper party or parties.
SECTION 8.02. Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 8.01:
(i) the Trustee may rely upon and shall be protected in acting or
refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other
paper or document reasonably believed by it to be genuine and without error
and to have been signed or presented by the proper party or parties;
(ii) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted by it hereunder in good faith and in accordance therewith;
(iii) the Trustee shall be under no obligation to exercise any of the
trusts or powers vested in it by this Agreement or to make any
investigation of matters arising hereunder or to institute, conduct or
defend any litigation hereunder or in relation hereto at the request, order
or direction of any of the Certificateholders, pursuant to the provisions
of this Agreement, unless (in the Trustee's reasonable opinion) such
Certificateholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby; the Trustee shall not be required to expend or risk its
own funds or otherwise incur any financial liability in the performance of
any of its duties hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that repayment of
such funds or adequate indemnity against
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such risk or liability is not reasonably assured to it; provided, however,
that nothing contained herein shall relieve the Trustee of the obligation,
upon the occurrence of an Event of Default which has not been waived or
cured, to exercise such of the rights and powers vested in it by this
Agreement, and to use the same degree of care and skill in their exercise
as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs;
(iv) neither the Trustee nor any Fiscal Agent appointed thereby shall
be personally liable for any action reasonably taken, suffered or omitted
by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement;
(v) prior to the occurrence of an Event of Default and after the
waiver or curing of all Events of Default which may have occurred, the
Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other
paper or document, unless requested in writing to do so by Holders of
Certificates entitled to at least 25% of the Voting Rights; provided,
however, that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the making of
such investigation is, in the opinion of the Trustee, not reasonably
assured to the Trustee by the security afforded to it by the terms of this
Agreement, the Trustee may require reasonable indemnity against such
expense or liability as a condition to taking any such action;
(vi) except as contemplated by Section 8.06 and/or Section 8.14, the
Trustee shall not be required to give any bond or surety in respect of the
execution of the trusts created hereby or the powers granted hereunder;
(vii) the Trustee may execute any of the trusts or powers vested in it
by this Agreement or perform any of its duties hereunder either directly or
by or through agents or attorneys-in-fact, provided that the use of agents
or attorneys-in-fact shall not be deemed to relieve the Trustee of any of
its duties and obligations hereunder (except as expressly set forth
herein); and
(viii) neither the Trustee nor any Fiscal Agent appointed thereby
shall be responsible for any act or omission of the Servicer, the Special
Servicer or the REMIC Administrator (unless the Trustee is acting as
Servicer, Special Servicer or REMIC Administrator, as the case may be) or
of the Depositor.
SECTION 8.03. Trustee and Fiscal Agent not Liable for Validity or
Sufficiency of Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
statements attributed to, and the representations and warranties of, the Trustee
and/or any Fiscal Agent in Article II, and the signature of the Trustee set
forth on each outstanding Certificate) shall be taken as the statements of the
Depositor, the Servicer, the Special Servicer or the REMIC Administrator, as the
case may be, and neither the Trustee nor any Fiscal Agent assumes any
responsibility for their correctness. Neither the Trustee nor any Fiscal Agent
makes any representation as to the validity or sufficiency of this Agreement
(except as regards the enforceability of this Agreement against it) or of any
Certificate (other than as to the signature of the Trustee
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set forth thereon) or of any Mortgage Loan or related document. Neither the
Trustee nor any Fiscal Agent shall be accountable for the use or application by
the Depositor of any of the Certificates issued to it or of the proceeds of such
Certificates, or for the use or application of any funds paid to the Depositor
in respect of the assignment of the Mortgage Loans to the Trust Fund, or any
funds deposited in or withdrawn from the Collection Account or any other account
by or on behalf of the Depositor, the Servicer, the Special Servicer or the
REMIC Administrator (in each case, unless the Trustee is acting in such
capacity). Neither the Trustee nor any Fiscal Agent shall be responsible for the
accuracy or content of any resolution, certificate, statement, opinion, report,
document, order or other instrument furnished by the Depositor, the Servicer,
the Special Servicer or the REMIC Administrator (in each case, unless the
Trustee is acting in such capacity), and accepted by the Trustee or such Fiscal
Agent, as the case may be, in good faith, pursuant to this Agreement. Neither
the Trustee nor any Fiscal Agent shall be responsible for the legality or
validity of this Agreement (other than insofar as it relates to the obligations
of the Trustee or such Fiscal Agent, as the case may be, hereunder) or the
validity, priority, perfection or sufficiency of the security for the
Certificates issued or intended to be issued hereunder. Neither the Trustee nor
any Fiscal Agent shall have any responsibility for filing any financing or
continuation statement in any public office at any time or to otherwise perfect
or maintain the perfection of any security interest or lien granted to it
hereunder or to record this Agreement.
SECTION 8.04. Trustee and Fiscal Agent May Own Certificates.
The Trustee (in its individual or any other capacity), any Fiscal Agent or
any Affiliate of either of them may become the owner or pledgee of Certificates
with (except as otherwise provided in the definition of "Certificateholder") the
same rights it would have if it were not the Trustee, such Fiscal Agent or an
Affiliate of either of them, as the case may be.
SECTION 8.05. Fees and Expenses of Trustee; Indemnification of and by
Trustee, REMIC Administrator and Fiscal Agent.
(a) On each Distribution Date, the Trustee shall withdraw from the
Distribution Account, prior to any distributions to be made therefrom to
Certificateholders on such date, and pay to itself all earned but unpaid
Trustee's Fees in respect of the Mortgage Loans and any REO Mortgage Loans
through the end of the most recently ended calendar month, as compensation for
all services rendered by the Trustee in the execution of the trusts hereby
created and in the exercise and performance of any of the powers and duties of
the Trustee hereunder. As to each Mortgage Loan and REO Mortgage Loan, the
Trustee's Fee shall accrue during each calendar month, commencing with March
1998, at the Trustee's Fee Rate on a principal amount equal to the Stated
Principal Balance of such Mortgage Loan or REO Mortgage Loan immediately
following the Distribution Date in such calendar month (or, in the case of March
1998, on a principal amount equal to the Cut-off Date Balance of the particular
Mortgage Loan), whether or not interest is actually collected on each Mortgage
Loan and REO Mortgage Loan. With respect to each Mortgage Loan and REO Mortgage
Loan, the Trustee Fee shall accrue from time to time on the basis of a 360-day
year consisting of twelve 30-day months. The Trustee's Fees (which shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust) shall constitute the Trustee's sole compensation for such
services to be rendered by it.
(b) The Trustee and any affiliate, director, officer, employee or agent of
the Trustee shall be entitled to be indemnified and held harmless out of Trust
Fund for and against any loss, liability, claim or expense (including costs and
expenses of litigation, and of investigation, counsel fees, damages, judgments
and amounts paid in settlement) arising out of, or incurred in connection with,
this Agreement, the
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Certificates, the Mortgage Loans (unless it incurs any such expense or liability
in the capacity of successor Servicer or Special Servicer, in which case such
expense or liability will be reimbursable thereto in the same manner as it would
be for any other Servicer or Special Servicer, as the case may be) or any act or
omission of the Trustee relating to the exercise and performance of any of the
powers and duties of the Trustee hereunder, if (but only if) such loss,
liability, claim or expense constitutes an "unanticipated expense" within the
meaning of Treasury regulation Section 1.860G-1(b)(3)(ii); provided, however,
that neither the Trustee nor any of the other above specified Persons shall be
entitled to indemnification pursuant to this Section 8.05(b) for (1) allocable
overhead of the Trustee, such as costs for office space, office equipment,
supplies and related expenses, employee salaries and related expenses and
similar internal costs and expenses, (2) any expense or liability specifically
required to be borne thereby pursuant to the terms hereof or (3) any loss,
liability, claim or expense incurred by reason of any breach on the part of the
Trustee of any of its representations, warranties or covenants contained herein
or any willful misfeasance, bad faith or negligence in the performance of, or
reckless disregard of, the Trustee's obligations and duties hereunder. For so
long as the Trustee and the REMIC Administrator are the same Person, the REMIC
Administrator shall be entitled to the same indemnification as is the Trustee
under this Section 8.05(b).
(c) Each of the Servicer and the Special Servicer shall indemnify the
Trustee, any Fiscal Agent and the REMIC Administrator for and hold each of them
harmless against any loss, liability, claim or expense that is a result of the
Servicer's or the Special Servicer's, as the case may be, negligent acts or
omissions in connection with this Agreement, including the negligent use by the
Servicer or the Special Servicer, as the case may be, of any powers of attorney
delivered to it by the Trustee pursuant to the provisions hereof and the
Mortgage Loans serviced by the Servicer or the Special Servicer, as the case may
be; provided, however, that, if the Trustee has been reimbursed for such loss,
liability, claim or expense pursuant to Section 8.05(b), any Fiscal Agent has
been reimbursed for such loss, liability, claim or expense pursuant to Section
8.13, or the REMIC Administrator has been reimbursed for such loss, liability,
claim or expense pursuant to Section 6.03, then the indemnity in favor of such
Person provided for in this Section 8.05(c) with respect to such loss,
liability, claim or expense shall be for the benefit of the Trust.
(d) Each of the Trustee, any Fiscal Agent and the REMIC Administrator shall
indemnify the Servicer and the Special Servicer for and hold each of them
harmless against any loss, liability, claim or expense that is a result of the
Trustee's, such Fiscal Agent's or the REMIC Administrator's, as the case may be,
negligent acts or omissions in connection with this Agreement; provided,
however, that if the Servicer or the Special Servicer has been reimbursed for
such loss, liability, claim or expense pursuant to Section 6.03, then the
indemnity in favor of such Person provided for in this Section 8.05(d) with
respect to such loss, liability, claim or expense shall be for the benefit of
the Trust.
(e) This Section 8.05 shall survive the termination of this Agreement or
the resignation or removal of the Trustee, any Fiscal Agent, the REMIC
Administrator, the Servicer and the Special Servicer as regards rights and
obligations prior to such termination, resignation or removal.
SECTION 8.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a corporation, bank, trust
company or association organized and doing business under the laws of the United
States of America or any State thereof or the District of Columbia, authorized
under such laws to exercise trust powers, having a combined capital and surplus
of at least $50,000,000 and subject to supervision or examination by federal or
state authority. If such corporation, bank, trust company or association
publishes reports of condition at least annually,
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pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section the combined capital and
surplus of such corporation, bank, trust company or association shall be deemed
to be its combined capital and surplus as set forth in its most recent report of
condition so published. The Trustee shall at all times maintain a long-term
unsecured debt rating of no less than "AA" from each of S&P and Fitch and "Aa3"
from Moody's (or, in the case of any Rating Agency, such lower rating as will
not result in an Adverse Rating Event with respect to any Class of Rated
Certificates (as confirmed in writing to the Trustee and the Depositor by such
Rating Agency)); provided that the Trustee shall not cease to be eligible to
serve as such based on a failure to satisfy such rating requirements so long as
either: (i) the Trustee maintains a long-term unsecured debt rating of no less
than "BBB" from each of S&P and Fitch and "A2" from Moody's (or, in the case of
any Rating Agency, such lower rating as will not result in an Adverse Rating
Event with respect to any Class of Rated Certificates (as confirmed in writing
to the Trustee and the Depositor by such Rating Agency)) and a Fiscal Agent
meeting the requirements of Section 8.13 has been appointed by the Trustee and
is then currently serving in such capacity; or (ii) the Trustee maintains a
long-term unsecured debt rating of no less than "A+" from each of S&P and Fitch
and "A1" from Moody's (or, in the case of any Rating Agency, such lower rating
as will not result in an Adverse Rating Event with respect to any Class of Rated
Certificates (as confirmed in writing to the Trustee and the Depositor by such
Rating Agency)) and an Advance Security Arrangement meeting the requirements of
Section 8.14 has been established by the Trustee and is then currently being
maintained. In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 8.06, the Trustee shall resign
immediately in the manner and with the effect specified in Section 8.07. The
corporation, bank, trust company or association serving as Trustee may have
normal banking and trust relationships with the Depositor, the Seller, the
Servicer, the Special Servicer, the REMIC Administrator and their respective
Affiliates; provided, however, that none of the Depositor, the Seller or any
Affiliate of either of them may be the Trustee hereunder.
SECTION 8.07. Resignation and Removal of Trustee.
(a) The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Depositor, the Servicer,
the Special Servicer, the REMIC Administrator and all the Certificateholders.
Upon receiving such notice of resignation, the Depositor shall promptly appoint
a successor trustee meeting the eligibility requirements of Section 8.06 by
written instrument, in duplicate, which instrument shall be delivered to the
resigning Trustee and to the successor trustee. A copy of such instrument shall
be delivered to other parties hereto and to the Certificateholders by the
Depositor. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
(b) If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request therefor by the Depositor or the Servicer, or if at any time the Trustee
shall become incapable of acting, or shall be adjudged bankrupt or insolvent, or
a receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, or if
the Trustee's continuing to act in such capacity would (as confirmed in writing
to any party hereto by any Rating Agency) result in an Adverse Rating Event with
respect to any Class of Rated Certificates, then the Depositor may (and, if it
fails to do so within 10 Business Days, the Servicer shall) remove the Trustee
and appoint a successor trustee by written instrument, in duplicate, which
instrument shall be delivered to the
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Trustee so removed and to the successor trustee. A copy of such instrument shall
be delivered to the other parties hereto and to the Certificateholders by the
Depositor (or the Servicer, as the case may be).
(c) The Holders of Certificates entitled to at least a majority of the
Voting Rights (or, if such removal is in connection with the Trustee's and any
Fiscal Agent's failure to make any required Advance, 25% of the Voting Rights)
may at any time remove the Trustee and appoint a successor trustee by written
instrument or instruments, in triplicate, signed by such Holders or their
attorneys-in-fact duly authorized, one complete set of which instruments shall
be delivered to the Depositor, one complete set to the Trustee so removed and
one complete set to the successor so appointed. A copy of such instrument shall
be delivered to the other parties hereto and to the remaining Certificateholders
by the successor so appointed.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section 8.07 shall
not become effective until (i) acceptance of appointment by the successor
trustee as provided in Section 8.08 and (ii) if neither the Trustee nor any
Fiscal Agent appointed by it has a long-term unsecured debt rating of at least
"AA" from each of S&P and Fitch and "Aa3" from Moody's, the Trustee and the
Depositor have received written confirmation from each Rating Agency that has
not so assigned such a rating, to the effect that the appointment of such
successor Trustee shall not result in an Adverse Rating Event with respect to
any Class of Rated Certificates. Notwithstanding anything herein to the
contrary, if any Person is acting as both Trustee and REMIC Administrator, then
any resignation or removal of such Person as the Trustee shall be accompanied by
the resignation or removal of such Person as REMIC Administrator, and the
successor trustee shall serve as successor REMIC administrator as well.
SECTION 8.08. Successor Trustee.
(a) Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor, the Servicer, the Special
Servicer, the REMIC Administrator and to its predecessor trustee an instrument
accepting such appointment hereunder, and thereupon the resignation or removal
of the predecessor trustee shall become effective and such successor trustee,
without any further act, deed or conveyance, shall become fully vested with all
the rights, powers, duties and obligations of its predecessor hereunder, with
the like effect as if originally named as trustee herein. The predecessor
trustee shall deliver to the successor trustee all Mortgage Files and related
documents and statements held by it hereunder (other than any Mortgage Files at
the time held on its behalf by a Custodian, which Custodian shall become the
agent of the successor trustee), and the Depositor, the Servicer, the Special
Servicer, the REMIC Administrator and the predecessor trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
to more fully and certainly vest and confirm in the successor trustee all such
rights, powers, duties and obligations, and to enable the successor trustee to
perform its obligations hereunder.
(b) No successor trustee shall accept appointment as provided in this
Section 8.08 unless at the time of such acceptance such successor trustee shall
be eligible under the provisions of Section 8.06.
(c) Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, such successor trustee shall mail notice of the succession of
such trustee hereunder to the Depositor and the Certificateholders.
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SECTION 8.09. Merger or Consolidation of Trustee.
Any entity into which the Trustee may be merged or converted or with which
it may be consolidated or any entity resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any entity succeeding to
the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, provided such entity shall be eligible under the provisions
of Section 8.06, 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.
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing the same may at the time be located, the
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund, and
to vest in such Person or Persons, in such capacity, such title to the Trust
Fund, or any part thereof, and, subject to the other provisions of this Section
8.10, such powers, duties, obligations, rights and trusts as the Servicer and
the Trustee may consider necessary or desirable. If the Servicer shall not have
joined in such appointment within 15 days after the receipt by it of a request
to do so, or in case an Event of Default in respect of the Servicer shall have
occurred and be continuing, the Trustee alone shall have the power to make such
appointment. No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor trustee under Section 8.06, and no
notice to Holders of Certificates of the appointment of co-trustee(s) or
separate trustee(s) shall be required under Section 8.08.
(b) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.10, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
when acting as Servicer, Special Servicer or REMIC Administrator hereunder), the
Trustee shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations (including the holding
of title to the Trust Fund or any portion thereof in any such jurisdiction)
shall be exercised and performed by such separate trustee or co-trustee at the
direction of the Trustee.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
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(d) Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
(e) The appointment of a co-trustee or separate trustee under this Section
8.10 shall not relieve the Trustee of its duties and responsibilities hereunder.
SECTION 8.11. Appointment of Custodians.
The Trustee may, with the consent of the Servicer, appoint at the Trustee's
own expense one or more Custodians to hold all or a portion of the Mortgage
Files as agent for the Trustee; provided that if the Custodian is an Affiliate
of the Trustee such consent of the Servicer need not be obtained and the Trustee
shall inform the Servicer of such appointment. Each Custodian shall be a
depository institution supervised and regulated by a federal or state banking
authority, shall have combined capital and surplus of at least $10,000,000,
shall be qualified to do business in the jurisdiction in which it holds any
Mortgage File, shall not be the Depositor, the Seller or any Affiliate of the
Depositor or the Seller, and shall have in place a fidelity bond and errors and
omissions policy, each in such form and amount as is customarily required of
custodians acting on behalf of FHLMC or FNMA. Each Custodian shall be subject to
the same obligations, standard of care, protection and indemnities as would be
imposed on, or would protect, the Trustee hereunder in connection with the
retention of Mortgage Files directly by the Trustee. The appointment of one or
more Custodians shall not relieve the Trustee from any of its obligations
hereunder, and the Trustee shall remain responsible for all acts and omissions
of any Custodian.
SECTION 8.12. Access to Certain Information.
(a) The Trustee shall afford to the Depositor, the Underwriter, the
Servicer, the Special Servicer, the Controlling Class Representative and each
Rating Agency and to the OTS, the FDIC and any other banking or insurance
regulatory authority that may exercise authority over any Certificateholder or
Certificate Owner, access to any documentation regarding the Mortgage Loans or
the other assets of the Trust Fund that are in its possession or within its
control. Such access shall be afforded without charge but only upon reasonable
prior written request and during normal business hours at the offices of the
Trustee designated by it.
(b) The Trustee shall maintain at its offices and, upon reasonable prior
written request and during normal business hours, shall make available for
review by the Depositor, the Rating Agencies, the Controlling Class
Representative and, subject to the succeeding paragraph, any Certificateholder,
Certificate Owner or Person identified to the Trustee as a prospective
Transferee of a Certificate or an interest therein, originals and/or copies of
the following items: (i) the Prospectus, the Memorandum and any other disclosure
document relating to the Certificates, in the form most recently provided to the
Trustee by the Depositor or by any Person designated by the Depositor; (ii) this
Agreement, each Sub-Servicing Agreement delivered to the Trustee since the
Closing Date and any amendments hereto or thereto; (iii) all Trustee Reports
delivered to Certificateholders pursuant to Section 4.02(a) since the Closing
Date; (iv) all Annual Performance Certifications delivered by the Servicer and
the Special Servicer, respectively, to the Trustee since the Closing Date; (v)
all Annual Accountants' Reports caused to be delivered by the Servicer and the
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Special Servicer, respectively, to the Trustee since the Closing Date; (vi) the
most recent inspection report prepared by the Servicer or the Special Servicer
and delivered to the Trustee in respect of each Mortgaged Property pursuant to
Section 3.12(a); (vii) the most recent quarterly and annual operating statement
and rent roll of each related Mortgaged Property and financial statements of the
related Mortgagor collected by the Servicer or the Special Servicer and
delivered to the Trustee pursuant to Section 3.12(b); (viii) any and all notices
and reports delivered to the Trustee with respect to any Mortgaged Property as
to which the environmental testing contemplated by Section 3.09(c) revealed that
neither of the conditions set forth in clauses (i) and (ii) of the first
sentence thereof was satisfied; (ix) all Determination Date Reports, Portfolio
Performance Reports and Special Servicer Reports delivered to the Trustee since
the Closing Date pursuant to Sections 4.02(b) and 4.02(c); (x) each of the
Mortgage Files, including any and all modifications, waivers and amendments of
the terms of a Mortgage Loan entered into or consented to by the Servicer or the
Special Servicer and delivered to the Trustee pursuant to Section 3.20; (xi) the
most recent Appraisal and, if applicable, Approved Summary Business Plan for
each Mortgage Loan and REO Property that has been delivered to the Trustee (such
items to be delivered to the Trustee by the Servicer or Special Servicer, as
applicable, promptly following their having been obtained or formulated); and
(xii) any and all Officer's Certificates and other evidence delivered to or by
the Trustee to support its, the Servicer's, the Special Servicer's or any Fiscal
Agent's, as the case may be, determination that any Advance was (or, if made,
would be) a Nonrecoverable Advance. The Trustee shall provide copies of any and
all of the foregoing items upon request of any of the parties set forth in the
previous sentence; however, except in the case of the Rating Agencies, the
Trustee shall be permitted to require payment of a sum sufficient to cover the
reasonable costs and expenses of providing such copies.
In connection with providing access to or copies of the items described in
the preceding paragraph pursuant to this Section 8.12(b), the Trustee shall
require: (a) in the case of Certificate Owners, a confirmation executed by the
requesting Person substantially in the form of Exhibit L-1 hereto (or such other
form as may be reasonably acceptable to the Trustee) generally to the effect
that such Person is a beneficial holder of Book-Entry Certificates and, subject
to the last sentence of this paragraph, will keep such information confidential
(except that such Certificate Owner may provide such information to any other
Person that holds or is contemplating the purchase of any Certificate or
interest therein, provided that such other Person confirms in writing such
ownership interest or prospective ownership interest and agrees to keep such
information confidential); and (b) in the case of a prospective purchaser of a
Certificate or an interest therein, confirmation executed by the requesting
Person substantially in the form of Exhibit L-2 hereto (or such other form as
may be reasonably acceptable to the Trustee) generally to the effect that such
Person is a prospective purchaser of a Certificate or an interest therein, is
requesting the information for use in evaluating a possible investment in
Certificates and, subject to the last sentence of this paragraph, will otherwise
keep such information confidential. The Holders of the Certificates, by their
acceptance thereof, will be deemed to have agreed, subject to the last sentence
of this paragraph, to keep such information confidential (except that any Holder
may provide any such information obtained by it to any other Person that holds
or is contemplating the purchase of any Certificate or interest therein,
provided that such other Person confirms in writing such ownership interest or
prospective ownership interest and agrees to keep such information
confidential). Notwithstanding the foregoing, no Certificateholder, Certificate
Owner or prospective Certificateholder or Certificate Owner need keep
confidential any information received from the Trustee pursuant to this Section
8.12(b) that has previously been made available via the Trustee's Internet
Website or has previously been filed with the Commission, and the Trustee shall
not require either of the certifications contemplated by the second preceding
sentence in connection with providing any information pursuant to this Section
8.12(b) that has previously been made available via the Trustee's Internet
Website or has previously been filed with the Commission.
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(c) The Trustee shall not be liable for providing or disseminating
information in accordance with Section 8.12(a) or Section 8.12(b).
SECTION 8.13. Appointment of Fiscal Agent.
(a) Insofar as the Trustee would not otherwise satisfy the rating
requirements of Section 8.06, the Trustee may appoint, at the Trustee's own
expense, a Fiscal Agent for purposes of making Advances hereunder that are
otherwise required to be made by the Trustee. Any Fiscal Agent shall at all
times maintain a long-term unsecured debt rating of no less than "AA" from each
of S&P and Fitch and "Aa3" from Moody's (or, in the case of any Rating Agency,
such lower rating as will not result in an Adverse Rating Event with respect to
any Class of Rated Certificates (as confirmed in writing to the Trustee and the
Depositor by such Rating Agency)). Any Person so appointed by the Trustee
pursuant to this Section 8.13(a) shall become the Fiscal Agent on the date as of
which the Trustee and the Depositor have received: (i) if the long-term
unsecured debt of the designated Person is not rated as least "AA" by each of
S&P and Fitch and "Aa3" by Moody's, written confirmation from each Rating Agency
that the appointment of such designated Person will not result in an Adverse
Rating Event with respect to any Class of Rated Certificates; (ii) a written
agreement whereby the designated Person is appointed as, and agrees to assume
and perform the duties of, Fiscal Agent hereunder, executed by such designated
Person and the Trustee (such agreement, the "Fiscal Agent Agreement"); and (iii)
an Opinion of Counsel (which shall be paid for by the designated Person or the
Trustee) substantially to the effect that (A) the appointment of the designated
Person to serve as Fiscal Agent is in compliance with this Section 8.13, (B) the
designated Person is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (C) the related Fiscal Agent
Agreement has been duly authorized, executed and delivered by the designated
Person and (D) the designated Person shall be bound by the terms of this
Agreement and, subject to customary bankruptcy and insolvency exceptions, that
this Agreement shall be enforceable against the designated Person in accordance
with its terms. Any Person that acts as Fiscal Agent shall, for so long as it so
acts, be deemed a party to this Agreement for all purposes hereof. Pursuant to
the related Fiscal Agent Agreement, each Fiscal Agent, if any, shall make
representations and warranties with respect to itself that are comparable to
those made by the Trustee pursuant to Section 2.07. Notwithstanding anything
contained in this Agreement to the contrary, any Fiscal Agent shall be entitled
to all limitations on liability, rights of reimbursement and indemnities to
which the Trustee is entitled hereunder (including pursuant to Sections 8.05(b)
and 8.05(c)) as if it were the Trustee.
(b) To the extent that the Trustee is required, pursuant to the terms of
this Agreement, to make any Advance, whether as successor Servicer or otherwise,
and has failed to do so in accordance with the terms hereof, the Fiscal Agent
(if any) shall make such Advance when and as required by the terms of this
Agreement on behalf the Trustee as if such Fiscal Agent were the Trustee
hereunder. To the extent that the Fiscal Agent (if any) makes an Advance
pursuant to this Section 8.13 or otherwise pursuant to this Agreement, the
obligations of the Trustee under this Agreement in respect of such Advance shall
be satisfied.
(c) All fees and expenses of any Fiscal Agent (other than interest owed to
such Fiscal Agent in respect of unreimbursed Advances) incurred by such Fiscal
Agent in connection with the transactions contemplated by this Agreement shall
be borne by the Trustee, and neither the Trustee nor such Fiscal Agent shall be
entitled to reimbursement therefor from any of the Trust, the Depositor, the
Servicer or the Special Servicer.
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(d) The obligations of any Fiscal Agent set forth in this Section 8.13 or
otherwise pursuant to this Agreement shall exist only for so long as the Trustee
that appointed it shall act as Trustee hereunder. Any Fiscal Agent may resign or
be removed by the Trustee only if and when the existence of such Fiscal Agent is
no longer necessary for such Trustee to satisfy the eligibility requirements of
Section 8.06; provided that any Fiscal Agent shall be deemed to have resigned at
such time as the Trustee that appointed it resigns or is removed as Trustee
hereunder (in which case the responsibility for appointing a successor Fiscal
Agent shall belong to the successor Trustee insofar as such appointment is
necessary for such successor Trustee to satisfy the eligibility requirements of
Section 8.06).
(e) The Trustee shall promptly notify the other parties hereto and the
Certificateholders in writing of the appointment, resignation or removal of any
Fiscal Agent.
SECTION 8.14 Advance Security Arrangement.
Insofar as the Trustee would not otherwise satisfy the rating requirements
of Section 8.06, the Trustee may, at is own expense with the approval of the
Depositor and each Rating Agency, arrange for the pledging of collateral, the
establishment of a reserve fund or the delivery of a letter of credit, surety
bond or other comparable instrument or for any other security arrangement (any
or all of the foregoing, individually and collectively, an "Advance Security
Arrangement") for purposes of supporting its back-up advancing obligations
hereunder; provided that any Advance Security Arrangement shall be in such form
and amount, and shall be maintained in such manner, as (i) would permit the
Trustee to act in such capacity without an Adverse Rating Event in respect of
any Class of Rated Certificates (as confirmed in writing to the Trustee and the
Depositor by each Rating Agency) and (ii) would not result in an Adverse REMIC
Event (as evidenced by an Opinion of Counsel addressed and delivered to the
Trustee, the Depositor and the REMIC Administrator). The Trustee may terminate
any Advance Security Arrangement established by it only if and when (i) the
existence of such Advance Security Arrangement is no longer necessary for the
Trustee to satisfy the eligibility requirements of Section 8.06 or (ii) when
such Trustee resigns or is removed as Trustee hereunder.
SECTION 8.15. Filings with the Securities and Exchange Commission.
For so long as it is required under the Exchange Act, the Trustee shall
prepare for filing, execute and properly file with the Commission, monthly, a
Current Report on form 8-K with copies of the Certificateholder Reports attached
as exhibits, and periodically upon direction of the Depositor, any other
reports, statements and information respecting the Trust Fund and/or the
Certificates that has been furnished to the Trustee; provided that such items
shall have been received by the Trustee (to the extent not generated by the
Trustee) in the format required for electronic filing via the EDGAR system; and
provided, further, that any such items that are required to be delivered by the
Servicer or the Special Servicer to the Trustee shall be so delivered in the
format required for electronic filing via the EDGAR system (in addition to any
other required format); and provided further, that the Depositor shall be
responsible for preparing, executing and filing the Current Report on Form 8-K
whereby a form of this Agreement is to be filed with the Commission within 15
days following the Closing Date. The Trustee shall have no responsibility to
file any such items that have not been received in such EDGAR-compatible format
nor shall it have any responsibility to convert any items to such format. The
Depositor shall promptly file, and exercise reasonable efforts to obtain a
favorable response to, no-action requests to, or requests for other appropriate
exemptive relief from, the Commission regarding the usual and customary
exemption from certain reporting requirements granted to issuers of securities
similar to the Certificates.
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ARTICLE IX
TERMINATION
SECTION 9.01. Termination Upon Repurchase or Liquidation of All Mortgage
Loans.
Subject to Section 9.02, the Trust and the respective obligations and
responsibilities under this Agreement of the parties hereto (other than the
obligations of the Trustee to provide for and make payments to
Certificateholders as hereafter set forth) shall terminate upon payment (or
provision for payment) to the Certificateholders of all amounts held by or on
behalf of the Trustee and required hereunder to be so paid on the Distribution
Date following the earlier to occur of (i) the purchase by the Servicer, the
Special Servicer or the Majority Certificateholder of the Controlling Class of
all Mortgage Loans and each REO Property remaining in the Trust Fund at a price
(the "Termination Price") equal to (A) the aggregate Purchase Price of all the
Mortgage Loans remaining in the Trust Fund (exclusive of any REO Mortgage
Loan(s)), plus (B) the appraised value of each REO Property, if any, included in
the Trust Fund, such appraisal to be conducted by a Qualified Appraiser selected
by the Servicer and approved by the Trustee, minus (C) if the purchaser is the
Servicer or the Special Servicer, the aggregate amount of unreimbursed Advances
made by such Person, together with any unpaid Advance Interest in respect of
such unreimbursed Advances and any unpaid servicing compensation payable to such
Person (which items shall be deemed to have been paid or reimbursed to the
Servicer or the Special Servicer, as the case may be, in connection with such
purchase) and (ii) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund; provided, however, that in no event shall the Trust continue beyond
the expiration of 21 years from the death of the last survivor of the
descendants of Joseph P. Kennedy, the late ambassador of the United States to
the Court of St. James, living on the date hereof.
The Servicer, the Special Servicer or the Majority Certificateholder of the
Controlling Class, in that order of preference, may at its option elect to
purchase all the Mortgage Loans and each REO Property remaining in the Trust
Fund as contemplated by clause (i) of the preceding paragraph by giving written
notice to the other parties hereto (and, in the case of an election by the
Servicer or Special Servicer, to the Majority Certificateholder of the
Controlling Class, if any) no later than 60 days prior to the anticipated date
of purchase; provided, however, that the aggregate Stated Principal Balance of
the Mortgage Pool at the time of such election is less than 1.0% of the Initial
Pool Balance; and provided, further, that within 30 days after written notice of
such election is so given, no Person with a higher right of priority to make
such an election does so. No Prepayment Premiums or Yield Maintenance Premiums
will be payable in connection with such a purchase. If the Trust is to be
terminated in connection with the purchase of all the Mortgage Loans and each
REO Property remaining in the Trust Fund by the Servicer, the Special Servicer
or the Majority Certificateholder of the Controlling Class, such Person shall
deliver to the Servicer for deposit (or, if the Servicer is the purchaser, it
shall deposit) in the Collection Account (after the Determination Date, and
prior to the Servicer Remittance Date, relating to the anticipated Final
Distribution Date) an amount in immediately available funds equal to the
Termination Price. On the Servicer Remittance Date for the Final Distribution
Date, the Servicer shall transfer to the Distribution Account all amounts
required to be transferred thereto on such Servicer Remittance Date from the
Collection Account pursuant to the first paragraph of Section 3.04(b), together
with any other amounts on deposit in the Collection Account that would otherwise
be held for future distribution. Upon confirmation that the deposit of the
Termination Price has been made to the Collection Account, the Trustee shall
release or cause to be released to the purchasing party (or its designee) the
Mortgage Files for the remaining Mortgage Loans and shall execute all
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assignments, endorsements and other instruments furnished to it by the
purchasing party as shall be necessary to effectuate transfer of the Mortgage
Loans and REO Properties to the purchasing party (or its designee).
Notice of any termination shall be given promptly by the Trustee by letter
to Certificateholders mailed (x) if such notice is given in connection with the
purchase of all the Mortgage Loans and each REO Property remaining in the Trust
Fund by the Servicer, the Special Servicer or the Majority Certificateholder of
the Controlling Class, not earlier than the 15th day and not later than the 25th
day of the month next preceding the month of the final distribution on the
Certificates and (y) otherwise during the month of such final distribution on or
before the Servicer Remittance Date in such month, in any event specifying (i)
the Distribution Date upon which the Trust Fund will terminate and final payment
on the Certificates will be made, (ii) the amount of any such final payment and
(iii) that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein designated. The
Trustee shall give such notice to the other parties hereto at the time such
notice is given to Certificateholders.
Upon presentation and surrender of the Certificates by the
Certificateholders on the Final Distribution Date, the Trustee shall distribute
to each Certificateholder so presenting and surrendering its Certificates such
Certificateholder's Percentage Interest of that portion of the Available
Distribution Amount that is allocable to payments on the relevant Class in
accordance with Sections 4.01(a) and 4.01(b).
Any funds not distributed to any Holder or Holders of Certificates of any
Class on the Final Distribution Date because of the failure of such Holder or
Holders to tender their Certificates shall, on such date, be set aside and held
uninvested in trust and credited to the account or accounts of the appropriate
non-tendering Holder or Holders. If any Certificates as to which notice has been
given pursuant to this Section 9.01 shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Trustee shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation in order to
receive the final distribution with respect thereto. If within one year after
the second notice all such Certificates shall not have been surrendered for
cancellation, the Trustee, directly or through an agent, shall take such
reasonable steps to contact the remaining non-tendering Certificateholders
concerning the surrender of their Certificates as it shall deem appropriate. The
costs and expenses of holding such funds in trust and of contacting such
Certificateholders following the first anniversary of the delivery of such
second notice to the non-tendering Certificateholders shall be paid out of such
funds. No interest shall accrue or be payable to any former Holder on any amount
held in trust hereunder. If by the second anniversary of the delivery of such
second notice, all of the Certificates shall not have been surrendered for
cancellation, then, subject to applicable escheat laws, the Trustee shall
distribute to the Class R-III Certificateholders all unclaimed funds and other
assets which remain subject hereto.
SECTION 9.02. Additional Termination Requirements.
(a) If the Servicer, the Special Servicer or the Majority Certificateholder
of the Controlling Class purchases all the Mortgage Loans and each REO Property
remaining in the Trust Fund as provided in Section 9.01, the Trust and each
REMIC created hereunder shall be terminated in accordance with the following
additional requirements, unless the purchasing party obtains at its own expense
and delivers to the Trustee and the REMIC Administrator an Opinion of Counsel,
addressed to the Trustee and the REMIC Administrator, to the effect that the
failure of the Trust to comply with the requirements of this Section 9.02 will
not result in an Adverse REMIC Event with respect to any REMIC Pool:
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(i) the REMIC Administrator shall specify the first day in the 90-day
liquidation period in a statement attached to the final Tax Return for each
REMIC Pool, pursuant to Treasury regulation Section 1.860F-1 and shall
satisfy all requirements of a qualified liquidation under Section 860F of
the Code and any regulations thereunder (as evidenced by an Opinion of
Counsel to such effect delivered on behalf and at the expense of the
purchasing party);
(ii) during such 90-day liquidation period and at or prior to the time
of making the final payment on the Certificates, the Trustee shall sell all
the Mortgage Loans and each REO Property to the Servicer, the Special
Servicer or the Majority Certificateholder of the Controlling Class for
cash in accordance with Section 9.01; and
(iii) immediately following the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited, to the Holders of the applicable Class of Residual
Interest Certificates all remaining cash on hand (other than cash retained
to meet claims), and each REMIC created hereunder shall terminate at that
time.
(b) By their acceptance of Certificates, the Holders hereby authorize the
REMIC Administrator to prepare and adopt, on behalf of the Trust, a plan of
complete liquidation of each REMIC Pool in accordance with the terms and
conditions of this Agreement, which authorization shall be binding upon all
successor Certificateholders.
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ARTICLE X
ADDITIONAL REMIC PROVISIONS
SECTION 10.01. REMIC Administration.
(a) The REMIC Administrator shall elect to treat each REMIC Pool as a REMIC
under the Code and, if necessary, under applicable state law. Each such election
will be made on Form 1066 or other appropriate federal tax or information return
or any appropriate state Tax Returns for the taxable year ending on the last day
of the calendar year in which the Certificates are issued.
(b) The applicable Plurality Residual Interest Certificateholder is hereby
designated as the Tax Matters Person of each REMIC Pool and, in such capacity,
shall be responsible to act on behalf of such REMIC Pool in relation to any tax
matter or controversy, to represent such REMIC Pool in any administrative or
judicial proceeding relating to an examination or audit by any governmental
taxing authority, to request an administrative adjustment as to any taxable year
of such REMIC Pool, to enter into settlement agreements with any governmental
taxing agency with respect to such REMIC Pool, to extend any statute of
limitations relating to any tax item of such REMIC Pool and otherwise to act on
behalf of such REMIC Pool in relation to any tax matter or controversy involving
such REMIC Pool; provided that the REMIC Administrator is hereby irrevocably
appointed and agrees to act (in consultation with the Tax Matters Person for
each REMIC Pool) as agent and attorney-in-fact for the Tax Matters Person for
each REMIC Pool in the performance of its duties as such. The legal expenses and
costs of any action described in this Section 10.01(b) and any liability
resulting therefrom shall be expenses, costs and liabilities of the Trust
payable out of amounts on deposit in the Distribution Account as provided by
Section 3.05(b) unless such legal expenses and costs are incurred by reason of a
Tax Matters Person's or the REMIC Administrator's misfeasance, bad faith or
negligence in the performance of, or such Person's reckless disregard of, its
obligations or are expressly provided by this Agreement to be borne by any party
hereto.
(c) The REMIC Administrator shall prepare or cause to be prepared and file,
and the Trustee shall sign, all of the Tax Returns in respect of each REMIC Pool
(other than Tax Returns required to be filed by the Servicer pursuant to Section
3.09(g)). The expenses of preparing and filing such returns shall be borne by
the REMIC Administrator without any right of reimbursement therefor.
(d) The REMIC Administrator shall perform on behalf of each REMIC Pool all
reporting and other tax compliance duties that are the responsibility of such
REMIC Pool under the Code, the REMIC Provisions or other compliance guidance
issued by the IRS or any state or local taxing authority. Included among such
duties, the REMIC Administrator shall provide: (i) to any Transferor of a
Residual Interest Certificate, such information as is necessary for the
application of any tax relating to the transfer of a Residual Interest
Certificate to any Person who is not a Permitted Transferee; (ii) to the
Certificateholders, such information or reports as are required by the Code or
the REMIC Provisions, including reports relating to interest, original issue
discount and market discount or premium (using the Prepayment Assumption as
required); and (iii) to the IRS, the name, title, address and telephone number
of the Person who will serve as the representative of each REMIC Pool.
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(e) The REMIC Administrator shall take such action and shall cause each
REMIC Pool to take such action as shall be necessary to create or maintain the
status thereof as a REMIC under the REMIC Provisions (and the other parties
hereto shall assist it, to the extent reasonably requested by the REMIC
Administrator) to the extent that the REMIC Administrator has actual knowledge
that any particular action is required; provided that the REMIC Administrator
shall be deemed to have knowledge of relevant tax laws. The REMIC Administrator
shall not knowingly take or fail to take any action, or cause any REMIC Pool to
take or fail to take any action, that under the REMIC Provisions, if taken or
not taken, as the case may be, could result in an Adverse REMIC Event in respect
of any REMIC Pool, unless the REMIC Administrator has received an Opinion of
Counsel to the effect that the contemplated action or non-action, as the case
may be, will not result in an Adverse REMIC Event. None of the other parties
hereto shall take or fail to take any action (whether or not authorized
hereunder) as to which the REMIC Administrator has advised it in writing that it
has received an Opinion of Counsel to the effect that an Adverse REMIC Event
could occur with respect to such action. In addition, prior to taking any action
with respect to any REMIC Pool or the assets thereof, or causing any REMIC Pool
to take any action, which is not expressly permitted under the terms of this
Agreement, each of the other parties hereto will consult with the REMIC
Administrator, in writing, with respect to whether such action could cause an
Adverse REMIC Event to occur, and no such other party shall take any such action
or cause any REMIC Pool to take any such action as to which the REMIC
Administrator has advised it in writing that an Adverse REMIC Event could occur.
The REMIC Administrator may consult with counsel to make such written advice,
and the cost of same shall be borne by the party seeking to take the action not
permitted by this Agreement.
(f) If any tax is imposed on any REMIC Pool, including "prohibited
transactions" taxes as defined in Section 860F(a)(2) of the Code, any tax on
"net income from foreclosure property" as defined in Section 860G(c) of the
Code, any taxes on contributions to any REMIC Pool after the Startup Day
pursuant to Section 860G(d) of the Code, and any other tax imposed by the Code
or any applicable provisions of state or local tax laws (other than any tax
permitted to be incurred by the Special Servicer on behalf of the Trust pursuant
to Section 3.17(a)), such tax, together with all incidental costs and expenses
(including penalties and reasonable attorneys' fees), shall be charged to and
paid by: (i) the REMIC Administrator, if such tax arises out of or results from
a breach of any of its obligations under this Article X; (ii) the Trustee, if
such tax arises out of or results from a breach of any of its obligations under
Article IV, Article VIII or this Article X; (iii) any Fiscal Agent, if such tax
arises out of or results from a breach of any of its obligations under Article
IV or this Article X; (iv) the Servicer, if such tax arises out of or results
from a breach by the Servicer of any of its obligations under Article III or
this Article X; (v) the Special Servicer, if such tax arises out of or results
from a breach by the Special Servicer of any of its obligations under Article
III or this Article X; or (vi) the Trust in all other instances. Any tax
permitted to be incurred by the Special Servicer pursuant to Section 3.17(a)
shall be charged to and paid by the Trust. Any such amounts payable by the Trust
in respect of taxes shall be paid by the Trustee at the direction of the REMIC
Administrator out of amounts on deposit in the Distribution Account.
(g) The REMIC Administrator and, to the extent that records are maintained
thereby in the normal course of its business, each of the other parties hereto
shall, for federal income tax purposes, maintain books and records with respect
to each REMIC Pool on a calendar year and on an accrual basis.
(h) Following the Startup Day for each REMIC Pool, the Trustee shall not
(except as contemplated by Section 2.03) accept any contributions of assets to
any REMIC Pool unless it shall have received an Opinion of Counsel (at the
expense of the party seeking to cause such contribution) to the effect
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that the inclusion of such assets in such REMIC Pool will not result in an
Adverse REMIC Event in respect of such REMIC Pool.
(i) None of the REMIC Administrator, the Servicer, the Special Servicer,
the Trustee or any Fiscal Agent shall consent to or, to the extent it is within
the control of such Person, permit: (i) the sale or disposition of any Mortgage
Loan (except in connection with (A) a breach of any representation or warranty
regarding any Mortgage Loan set forth in or made pursuant to the Mortgage Loan
Purchase and Sale Agreement or, in the case of a Third Party Mortgage Loan, the
related Third Party Originator Agreement or as otherwise contemplated by Section
2.02(e), (B) the foreclosure, default or reasonably foreseeable material default
of a Mortgage Loan, including the sale or other disposition of a Mortgaged
Property acquired by foreclosure, deed in lieu of foreclosure or otherwise, (C)
the bankruptcy of any REMIC Pool, or (D) the termination of the Trust pursuant
to Article IX of this Agreement); (ii) the sale or disposition of any
investments in the Collection Account or the REO Account for gain; or (iii) the
acquisition of any assets for the Trust (other than a Mortgaged Property
acquired through foreclosure, deed in lieu of foreclosure or otherwise in
respect of a defaulted Mortgage Loan, other than a Replacement Mortgage Loan
substituted for a Deleted Mortgage Loan and other than Permitted Investments
acquired in connection with the investment of funds in the Collection Account or
the REO Account); in any event unless it has received an Opinion of Counsel (at
the expense of the party seeking to cause such sale, disposition, or
acquisition) to the effect that such sale, disposition, or acquisition will not
result in an Adverse REMIC Event in respect of any REMIC Pool.
(j) Except as otherwise permitted by Section 3.17(a), none of the REMIC
Administrator, the Servicer, the Special Servicer or the Trustee shall enter
into any arrangement by which any REMIC Pool will receive a fee or other
compensation for services or, to the extent it is within the control of such
Person, permit any REMIC Pool to receive any income from assets other than
"qualified mortgages" as defined in Section 860G(a)(3) of the Code or "permitted
investments" as defined in Section 860G(a)(5) of the Code. At all times as may
be required by the Code, each of the respective parties hereto (to the extent it
is within its control) shall ensure that substantially all of the assets of each
REMIC Pool will consist of "qualified mortgages" as defined in Section
860G(a)(3) of the Code and "permitted investments" as defined in Section
860G(a)(5) of the Code.
(k) Within 30 days after the Closing Date, the REMIC Administrator shall
prepare and file with the IRS, with respect to each REMIC Pool, Form 8811
"Information Return for Real Estate Mortgage Investment Conduits (REMICs) and
Issuers of Collateralized Debt Obligations".
(l) On or before April 15 of each calendar year, commencing April 15, 1999,
unless the REMIC Administrator and the Trustee are the same Person, the REMIC
Administrator shall deliver to the Trustee an Officer's Certificate from a
Responsible Officer of the REMIC Administrator confirming the REMIC
Administrator's compliance with its obligations under this Agreement.
SECTION 10.02. Depositor, Servicer, Special Servicer, Trustee and Fiscal
Agent to Cooperate with REMIC Administrator.
(a) The Depositor shall provide or cause to be provided to the REMIC
Administrator, within ten days after the Closing Date, all information or data
that the REMIC Administrator reasonably determines to be relevant for tax
purposes as to the valuations and issue prices of the Certificates, including
the price, yield, prepayment assumption and projected cash flow of the
Certificates.
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(b) Each of the Servicer, the Special Servicer, the Trustee and any Fiscal
Agent shall furnish such reports, certifications and information in its
possession, and access to such books and records maintained thereby, as may
relate to the Certificates or the Trust Fund and as shall be reasonably
requested by the REMIC Administrator in order to enable it to perform its duties
hereunder.
SECTION 10.03. Fees of the REMIC Administrator.
In the event the Trustee and the REMIC Administrator are not the same
Person, the Trustee covenants and agrees to pay to the REMIC Administrator from
time to time, and the REMIC Administrator shall be entitled to, reasonable
compensation (as set forth in a written agreement between the Trustee and the
REMIC Administrator) for all services rendered by the REMIC Administrator in the
exercise and performance of any of its obligations and duties hereunder.
SECTION 10.04. Use of Agents.
The REMIC Administrator may execute any of its obligations and duties
hereunder either directly or by or through agents or attorneys-in-fact approved
by the Trustee (which approval shall not be unreasonably withheld); provided
that the REMIC Administrator will not be relieved of its obligations hereunder
by reason of the use of such agents or attorneys-in-fact.
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ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment.
(a) This Agreement may be amended from time to time by the mutual agreement
of the parties hereto, without the consent of any of the Certificateholders, (i)
to cure any ambiguity, (ii) to correct, modify or supplement any provision
herein which may be inconsistent with any other provision herein, (iii) to add
any other provisions with respect to matters or questions arising hereunder
which shall not be inconsistent with the provisions hereof, (iv) to relax or
eliminate any requirement hereunder imposed by (A) the REMIC Provisions (if the
REMIC Provisions are amended or clarified such that any such requirement may be
relaxed or eliminated) or (B) the Securities Act or the rules thereunder (if the
Securities Act or such rules are amended or clarified such that any such
requirement may be relaxed or eliminated), (v) as evidenced by an Opinion of
Counsel delivered to the Trustee and the REMIC Administrator, either (X) to
comply with any requirements imposed by the Code or any successor or amendatory
statute or any temporary or final regulation, revenue ruling, revenue procedure
or other written official announcement or interpretation relating to federal
income tax laws or any such proposed action which, if made effective, would
apply retroactively to any REMIC Pool at least from the effective date of such
amendment, or (Y) to avoid the occurrence of a prohibited transaction or to
reduce the incidence of any tax that would arise from any actions taken with
respect to the operation of any REMIC Pool, (vi) as provided in Section
5.02(d)(iv), to modify, add to or eliminate any of the provisions of Section
5.02(d)(i), (ii) or (iii); or (vii) for any other purpose; provided that such
amendment (other than any amendment for any of the specific purposes described
in clauses (v) and (vi) above) shall not adversely affect in any material
respect the interests of any Certificateholder, as evidenced by an Opinion of
Counsel obtained by or delivered to the Trustee to such effect; and provided,
further, that any such amendment covered solely by clause (vii) above shall not
(as confirmed in writing to the Trustee by each Rating Agency) result in an
Adverse Rating Event with respect to any Class of Certificates.
(b) This Agreement may also be amended from time to time by the mutual
agreement of the parties hereto, with the consent of the Holders of Certificates
entitled to not less than 662/3% of the Voting Rights allocated to all of the
affected Classes, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Holders of Certificates; provided, however, that no
such amendment shall (i) reduce in any manner the amount of, or delay the timing
of, payments received or advanced on Mortgage Loans and/or REO Properties which
are required to be distributed on any Certificate without the consent of the
Holder of such Certificate, (ii) adversely affect in any material respect the
interests of the Holders of any Class of Certificates in a manner other than as
described in clause (i) above without the consent of the Holders of all
Certificates of such Class or (iii) modify the provisions of this Section 11.01
without the consent of the Holders of all Certificates then outstanding.
Notwithstanding any other provision of this Agreement, for purposes of the
giving or withholding of consents pursuant to this Section 11.01, Certificates
registered in the name of the Depositor or any Affiliate of the Depositor shall
be entitled to the same Voting Rights with respect to the matters described
above as they would if registered in the name of any other Person.
(c) Notwithstanding any contrary provision of this Agreement, neither the
Trustee nor the REMIC Administrator shall consent to any amendment to this
Agreement unless it shall first have obtained or been furnished with an Opinion
of Counsel to the effect that such amendment or the exercise of
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any power granted to any party hereto in accordance with such amendment will not
result in an Adverse REMIC Event with respect to any REMIC Pool.
(d) Promptly after the execution and delivery of any amendment by all
parties thereto, the Trustee shall send a copy thereof to each Certificateholder
and to each Rating Agency.
(e) It shall not be necessary for the consent of Certificateholders under
this Section 11.01 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization, execution
and delivery thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
(f) The Trustee may but shall not be obligated to enter into any amendment
pursuant to this Section 11.01 that affects its rights, duties and immunities
under this Agreement or otherwise.
(g) The cost of any Opinion of Counsel to be delivered pursuant to Section
11.01(a) or (c) shall be borne by the Person seeking the related amendment,
except that if the Trustee requests any amendment of this Agreement that it
reasonably believes protects or is in furtherance of the rights and interests of
Certificateholders, the cost of any Opinion of Counsel required in connection
therewith pursuant to Section 11.01(a) or (c) shall be payable out of the
Distribution Account.
SECTION 11.02. Recordation of Agreement; Counterparts.
(a) To the extent permitted by applicable law, this Agreement is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Servicer at the expense of the Trust (payable out of the Collection Account),
but only upon written direction of the Trustee accompanied by an Opinion of
Counsel (the cost of which may be paid out of the Collection Account) to the
effect that such recordation materially and beneficially affects the interests
of the Certificateholders.
(b) For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
SECTION 11.03. Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust, nor entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
(b) No Certificateholder shall have any right to vote (except as expressly
provided for herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members
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of an association; nor shall any Certificateholder be under any liability to any
third party by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any provision of
this Agreement to institute any suit, action or proceeding in equity or at law
upon or under or with respect to this Agreement or any Mortgage Loan, unless,
with respect to any suit, action or proceeding upon or under or with respect to
this Agreement, such Holder previously shall have given to the Trustee a written
notice of default hereunder, and of the continuance thereof, as hereinbefore
provided, and unless also (except in the case of a default by the Trustee) the
Holders of Certificates entitled to at least 25% of the Voting Rights shall have
made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expenses
and liabilities to be incurred therein or thereby, and the Trustee, for 60 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding. It is
understood and intended, and expressly covenanted by each Certificateholder with
every other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatsoever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder (which priority or
preference is not otherwise provided for herein), or to enforce any right under
this Agreement, except in the manner herein provided and for the equal, ratable
and common benefit of all Certificateholders. For the protection and enforcement
of the provisions of this Section 11.03, each and every Certificateholder and
the Trustee shall be entitled to such relief as can be given either at law or in
equity.
SECTION 11.04. Governing Law.
This Agreement and the Certificates shall be construed in accordance with
the substantive laws of the State of New York applicable to agreements made and
to be performed entirely in said State, and the obligations, rights and remedies
of the parties hereunder shall be determined in accordance with such laws. The
parties hereto intend that the provisions of Section 5-1401 of the New York
General Obligations Law shall apply to this Agreement.
SECTION 11.05. Notices.
Any communications provided for or permitted hereunder shall be in writing
and, unless otherwise expressly provided herein, shall be deemed to have been
duly given when delivered to: (i) in the case of the Depositor, DLJ Commercial
Mortgage Corp., 277 Park Avenue, 9th Floor, New York, New York 10172, attention:
N. Dante LaRocca, telecopy number: (212) 892-2003; (ii) in the case of the
Servicer, Banc One Mortgage Capital Markets, LLC, 1717 Main Street, 14th Floor,
Dallas, Texas 75201, attention: Edgar L. Smith II, telecopy number: (214)
290-4480; (iii) in the case of the Special Servicer, Clarion Partners, LLC, 335
Madison Avenue, 7th Floor, New York, New York 10017, attention: Bruce Morrison,
telecopy number: (212) 883-2700; (iv) in the case of the Trustee and the REMIC
Administrator, Norwest Bank Minnesota, National Association, 11000 Broken Land
Parkway, Columbia, Maryland 21044-3562, attention: Corporate Trust Services
(CMBS)-DLJ Commercial Mortgage Corp., Series 1998-CF1, telecopy number: (410)
884- 2360; and (v) in the case of the Rating Agencies, (A) Standard & Poor's
Ratings Services, a Division of the McGraw-Hill Companies, Inc., 26 Broadway,
New York, New York 10004, attention: Commercial Mortgage Surveillance Group,
telecopy number: (212) 412-0539, (B) in the case of Moody's Investors Service,
Inc., 99 Church Street, New York, New York 10007, attention: Commercial MBS
Monitoring
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Department, telecopy number: (212) 553-0300 and (C) in the case of Fitch IBCA,
Inc., One State Street Plaza, New York, New York 10004, attention: Commercial
Mortgage Surveillance Department, telecopy number: (212) 635-0295; or as to each
such Person such other address and/or telecopy number as may hereafter be
furnished by such Person to the parties hereto in writing. Any communication
required or permitted to be delivered to a Certificateholder shall be deemed to
have been duly given when mailed first class, postage prepaid, to the address of
such Holder as shown in the Certificate Register.
SECTION 11.06. 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
covenant(s), agreement(s), provision(s) or term(s) 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 of the Certificates or the rights of the Holders
thereof.
SECTION 11.07. Successors and Assigns; Beneficiaries.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto, their respective successors and assigns and, as
third party beneficiaries, the Underwriter and the non-parties referred to in
Sections 6.03 and 8.05, and all such provisions shall inure to the benefit of
the Certificateholders. No other person, including any Mortgagor, shall be
entitled to any benefit or equitable right, remedy or claim under this
Agreement.
SECTION 11.08. Article and Section Headings.
The article and section headings herein are for convenience of reference
only, and shall not limit or otherwise affect the meaning hereof.
SECTION 11.09. Notices to and from the Rating Agencies.
(a) The Trustee shall promptly provide notice to each Rating Agency with
respect to each of the following of which a Responsible Officer of the Trustee
has actual knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Event of Default that has not been cured;
(iii) the resignation or termination of the Servicer, the Special
Servicer or the REMIC Administrator and the appointment of a successor;
(iv) the appointment, resignation or removal of a Fiscal Agent;
(v) any change in the location of the Distribution Account;
(vi) any repurchase or substitution of a Mortgage Loan by the Seller
or any Third Party Originator as contemplated by Section 2.03; and
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(vii) the final payment to any Class of Certificateholders.
(b) The Servicer shall promptly provide notice to each Rating Agency with
respect to each of the following of which it has actual knowledge:
(i) the resignation or removal of the Trustee and the appointment of a
successor; and
(ii) any change in the location of the Collection Account.
(c) Each of the Servicer and the Special Servicer, as the case may be,
shall furnish each Rating Agency such information with respect to the Mortgage
Loans as such Rating Agency shall reasonably request and which the Servicer or
the Special Servicer, as the case may be, can reasonably provide. In any event,
the Servicer and the Special Servicer shall notify each Rating Agency with
respect to each of the following of which it has actual knowledge:
(i) any change in the lien priority of the Mortgage securing any
Mortgage Loan;
(ii) any change in the identity of the anchor tenant at any Mortgaged
Property used for retail purposes or any change in the term of the lease
for an anchor tenant at any such Mortgaged Property;
(iii) any assumption of, or release or substitution of collateral for,
a Mortgage Loan that represents greater than 2% of the then Stated
Principal Balance of the Mortgage Pool; and
(iv) any material damage to a Mortgaged Property.
(d) Each of the Servicer and the Special Servicer, as the case may be,
shall promptly furnish each Rating Agency copies of the following items (in each
case, at or about the same time that it delivers or causes the delivery of such
item to the Trustee):
(i) each of its Annual Performance Certifications;
(ii) each of its Annual Accountants' Reports; and
(iii) each report prepared pursuant to Section 3.09(e) and Section
3.12.
(e) The Trustee shall promptly deliver to each Rating Agency a copy of each
Certificateholder Report forwarded to the Holders of the Certificates (in each
case, at or about the same time that it delivers such Certificateholder Report
to such Holders).
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SECTION 11.10. Reports by Trustee to Gaming Authorities.
The Trustee will provide the CCC, the New Jersey Division of Gaming
Enforcement and, upon written request, any other applicable Gaming Authority
with:
(1) copies of all notices, reports and other written communications
which the Trustee gives to Holders;
(2) a list of Holders promptly after the original issuance of the
Certificates and a list of Holders eight months and two months prior to the
expiration date of the then-current Gaming License held by the company
operating the casino at the Showboat Property;
(3) as soon as reasonably practical following the occurrence thereof,
notice of any default under the Showboat Loan, or any acceleration thereof,
the institution of any legal actions or proceedings before any court or
governmental authority in respect of the Showboat Loan or Showboat
Property, the entering into or taking possession of any property
constituting the collateral for the Showboat Loan and any rescission,
annulment or waiver in respect of a default under the Showboat Loan;
(4) notice of the removal or resignation of the Trustee, and
appointment of a successor Trustee, within five Business Days thereof;
(5) notice of any transfer or assignment of rights under the Showboat
Loan within five Business Days thereof;
(6) a copy of any amendment to the Certificates, this Agreement or the
Showboat Loan within five Business Days of the effectiveness thereof; and
(7) any other documents requested in writing by any applicable Gaming
Authority.
In the case of any notice in respect of any default under the Showboat
Loan, such notice shall be accompanied by a copy of any notice to the defaulting
Person and, if accompanied by any such notice to the defaulting Person, shall be
given simultaneously with the giving of any such notice to the defaulting
Person. In the case of any legal actions or proceedings, such notice shall be
accompanied by a copy of the complaint or other initial pleading or document.
The other parties hereto shall cooperate with the Trustee and any
applicable Gaming Authority in order to provide the Trustee and such Gaming
Authority with information and documentation relevant to compliance with clauses
(3), (5), (6) and (7) above and the preceding paragraph and as is otherwise
required by any applicable gaming law.
The Servicer and Special Servicer shall each provide the Trustee, as soon
as reasonably practical after becoming aware thereof (and, in any event, within
such time period as is necessary for the Trustee to comply with clauses (1)
through (7) above), with all information known to it that is relevant to the
Trustee for performing the Trustee's obligations under this Section 11.10.
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As of the Closing Date, the addresses of the CCC and the New Jersey
Division of Gaming Enforcement relevant for purposes of this Section 11.10 are:
(i) in the case of the CCC, 1325 Boardwalk, Atlantic City, New Jersey 08401; and
(ii) in the case of the New Jersey Division of Gaming Enforcement, 1601 Atlantic
Avenue, Atlantic City, New Jersey 08401.
SECTION 11.11. Complete Agreement.
This Agreement embodies the complete agreement among the parties and may
not be varied or terminated except by a written agreement conforming to the
provisions of Section 11.01. All prior negotiations or representations of the
parties are merged into this Agreement and shall have no force or effect unless
expressly stated herein.
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IN WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto by their respective officers thereunto duly authorized, in each case as
of the day and year first above written.
DLJ COMMERCIAL MORTGAGE CORP.
Depositor
By:_________________________________
Name:
Title:
BANC ONE MORTGAGE CAPITAL
MARKETS, LLC
Servicer
By:__________________________________
Name:
Title:
CLARION PARTNERS, LLC
Special Servicer
By: Clarion Partners, Inc.,
its managing member
By:___________________________________
Name:
Title:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
solely in its capacity as
Trustee and REMIC Administrator
By:___________________________________
Name:
Title:
<PAGE>
STATE OF ________________ )
) ss.:
COUNTY OF _______________ )
On the ______ day of February 1998, before me, a notary public in and for
said State, personally appeared ____________________, personally known to me to
be a ____________________ of DLJ COMMERCIAL MORTGAGE CORP., one of the entities
that executed the within instrument, and also known to me to be the person who
executed it on behalf of such entity, and acknowledged to me that such entity
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
Notary Public
[Notarial Seal]
<PAGE>
STATE OF________________ )
): ss.:
COUNTY OF _____________ )
On this _____ day of February 1998, before me, a notary public in and for
said State, personally appeared Edgar L. Smith II, personally known to me to be
the Chief Operating Officer of BANC ONE MORTGAGE CAPITAL MARKETS, LLC, one of
the entities that executed the within instrument, and also known to me to be the
person who executed it on behalf of such entity, and acknowledged to me that
such entity executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
__________________________________
Notary Public
[Notarial Seal]
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 2nd day of March 1998, before me, a notary public in and for said
State, personally appeared ____________________, personally known to me to be a
____________________ of CLARION PARTNERS, INC., the managing member of CLARION
PARTNERS, LLC, one of the entities that executed the within instrument and also
known to me to be the person who executed it on behalf of such entity, and
acknowledged to me that such entity executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
__________________________________
Notary Public
[Notarial Seal]
<PAGE>
STATE OF _____________ )
) ss.:
COUNTY OF ___________ )
On the 2nd______ day of February 1998, before me, a notary public in and
for said State, personally appeared ____________________, personally known to me
to be a ____________________ of NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
one of the entities that executed the within instrument, and also known to me to
be the person who executed it on behalf of such entity, and acknowledged to me
that such entity executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
__________________________________
Notary Public
[Notarial Seal]
<PAGE>
EXHIBIT A-1
FORM OF CLASS CP AND CLASS S CERTIFICATES
CLASS [CP] [S] COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-CF1
This is one of a series of commercial mortgage pass-through certificates
(collectively, the "Certificates"), issued in multiple classes (each, a
"Class"), which series of Certificates evidences the entire beneficial ownership
interest in a trust fund (the "Trust Fund") consisting primarily of a pool of
multifamily and commercial mortgage loans (the "Mortgage Loans"), such pool
being formed and sold by
DLJ COMMERCIAL MORTGAGE CORP.
Pass-Through Rate: Class Notional Amount of the Class [CP] [S]
Variable Certificates as of the Closing Date:
$______________________
Cut-off Date: March 1, 1998 Initial Certificate Notional Amount of this
Certificate as of the Closing Date:
Closing Date: March 2, 1998 $_________________
First Distribution Date: Aggregate Stated Principal Balance of the
April 15, 1998 Mortgage Loans as of the Closing Date
("Initial Pool Balance"): $838,800,140
Servicer: Trustee and REMIC Administrator:
Banc One Mortgage Norwest Bank Minnesota, National
Capital Markets, LLC Association
Special Servicer:
Clarion Partners, LLC
Certificate No. [CP][S]-_ CUSIP No.: ____________
A-1-1
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR
ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN DLJ
COMMERCIAL MORTGAGE CORP., BANC ONE MORTGAGE CAPITAL MARKETS, LLC, CLARION
PARTNERS, LLC, NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR ANY OF THE UNDERLYING
MORTGAGE LOANS IS GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
STATES OR ANY OTHER PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
[THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE
U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS
CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 2, 1998. ASSUMING THAT
THE MORTGAGE LOANS ARE NOT SUBJECT TO ANY VOLUNTARY OR INVOLUNTARY PREPAYMENT OF
PRINCIPAL (EXCEPT THAT THE ARD LOANS ARE ASSUMED TO BE PAID IN FULL ON THEIR
RESPECTIVE ANTICIPATED REPAYMENT DATES), THIS CERTIFICATE HAS BEEN ISSUED WITH
NO MORE THAN $______ OF OID PER $100,000 OF INITIAL CERTIFICATE NOTIONAL AMOUNT,
THE YIELD TO MATURITY IS ____% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO
THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $____ PER $100,000 OF INITIAL
CERTIFICATE NOTIONAL AMOUNT, COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION
IS MADE THAT THE MORTGAGE LOANS WILL NOT PREPAY OR, IF THEY DO PREPAY, THAT THEY
WILL PREPAY AT ANY PARTICULAR RATE.]
THE OUTSTANDING CERTIFICATE NOTIONAL AMOUNT HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE. THIS CERTIFICATE DOES NOT HAVE A CERTIFICATE PRINCIPAL
BALANCE AND WILL NOT ENTITLE THE HOLDER HEREOF TO DISTRIBUTIONS OF PRINCIPAL.
A-1-2
<PAGE>
This certifies that CEDE & CO. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the notional amount
of this Certificate (its "Certificate Notional Amount") as of the Closing Date
by the aggregate notional amount of all the Class [CP] [S] Certificates (their
"Class Notional Amount") as of the Closing Date) in that certain beneficial
ownership interest in the Trust Fund evidenced by all the Class [CP][S]
Certificates. The Trust Fund was created and the Certificates were issued
pursuant to a Pooling and Servicing Agreement, dated as of the Cut-off Date
specified above (the "Agreement"), among DLJ Commercial Mortgage Corp. (the
"Depositor", which term includes any successor entity under the Agreement), Banc
One Mortgage Capital Markets, LLC (the "Servicer", which term includes any
successor entity under the Agreement), Clarion Partners, LLC (the "Special
Servicer", which term includes any successor entity under the Agreement) and
Norwest Bank Minnesota, National Association (the "Trustee" and "REMIC
Administrator", depending upon the capacity in which it is acting, each of which
terms includes any successor entity under the Agreement), a summary of certain
of the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, capitalized terms used herein have the respective meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of its acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to all the Holders of the
Class [CP] [S] Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on this Certificate will
be made by the Trustee by wire transfer of immediately available funds to the
account of the Person entitled thereto at a bank or other entity having
appropriate facilities therefor, if such Certificateholder shall have provided
the Trustee with wiring instructions no less than five Business Days prior to
the related Record Date (which wiring instructions may be in the form of a
standing order applicable to all subsequent distributions), or otherwise by
check mailed to the address of such Certificateholder as it appears in the
Certificate Register. Notwithstanding the foregoing, the final distribution on
this Certificate will be made in like manner, but only upon presentation and
surrender of this Certificate at the offices of the Certificate Registrar or
such other location specified in the notice to the Holder hereof of such final
distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Distribution Account, the Collection Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
A-1-3
<PAGE>
This Certificate is issuable in fully registered form only without coupons.
As provided in the Agreement and subject to certain limitations therein set
forth, this Certificate is exchangeable for new Certificates of the same Class
in authorized denominations evidencing the same aggregate Percentage Interest,
as requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer or
exchange of this Certificate, but the Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of this
Certificate.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC, and accordingly, this
Certificate shall constitute a Book-Entry Certificate.
The Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent, the Certificate Registrar and any agent of the
Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent or the Certificate Registrar may treat the
Person in whose name this Certificate is registered as the owner hereof for all
purposes, and none of the Depositor, the Servicer, the Special Servicer, the
Trustee, the REMIC Administrator, any Fiscal Agent, the Certificate Registrar or
any such agent shall be affected by notice to the contrary.
Subject to certain terms and conditions set forth in the Agreement, the
Trust Fund and the obligations created by the Agreement shall terminate upon
distribution (or provision for distribution) to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be distributed to
them pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Servicer, the Special Servicer or the Majority Certificateholder of the
Controlling Class, at a price determined as provided in the Agreement, of all
the Mortgage Loans and each REO Property remaining in the Trust Fund. The
Agreement permits, but does not require, the Servicer, the Special Servicer or
the Majority Certificateholder of the Controlling Class to purchase from the
Trust Fund all the Mortgage Loans and each REO Property remaining therein. The
exercise of such right may effect early retirement of the Certificates; however,
such right to purchase is subject to the aggregate Stated Principal Balance of
the Mortgage Pool at the time of purchase being less than 1.0% of the Initial
Pool Balance.
A-1-4
<PAGE>
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Special Servicer, the REMIC Administrator, the
Trustee and any Fiscal Agent and the rights of the Certificateholders under the
Agreement at any time by the Depositor, the Servicer, the Special Servicer, the
REMIC Administrator, the Trustee and any Fiscal Agent with the consent of the
Holders of Certificates entitled to not less than 662/3% of the Voting Rights
allocated to all of the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of any REMIC Pool as a REMIC, without the consent of the
Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that it will
look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the substantive laws
of the State of New York applicable to agreements made and to be performed
entirely in said State, and the obligations, rights and remedies of the Holder
hereof shall be determined in accordance with such laws.
A-1-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Trustee
By:______________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class [CP] [S] Certificates referred to in the
within-mentioned Agreement.
Dated:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By:______________________________________
Authorized Officer
A-1-6
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to _____________________________________________
________________________________________________________________________________
for the account of ____________________________________________________________.
Distributions made by check (such check to be made payable to _____________
_________________________________) and all applicable statements and notices
should be mailed to ___________________________________________________________.
This information is provided by _______________________, the Assignee named
above, or ________________________, as its agent.
A-1-7
<PAGE>
EXHIBIT A-2
FORM OF CLASS A-1A AND CLASS A-1B CERTIFICATES
CLASS [A-1A] [A-1B] COMMERCIAL MORTGAGE PASS-THROUGH
CERTIFICATE, SERIES 1998-CF1
This is one of a series of commercial mortgage pass-through certificates
(collectively, the "Certificates"), issued in multiple classes (each, a
"Class"), which series of Certificates evidences the entire beneficial ownership
interest in a trust fund (the "Trust Fund") consisting primarily of a pool of
multifamily and commercial mortgage loans (the "Mortgage Loans"), such pool
being formed and sold by
DLJ COMMERCIAL MORTGAGE CORP.
Pass-Through Rate: Class Principal Balance of the Class
Variable [A-1A][A-1B] Certificates as of the Closing
Date: $_____________________
Cut-off Date: March 1, 1998 Initial Certificate Principal Balance of
Closing Date: March 2, 1998 this Certificate as of the Closing Date:
$_____________________
First Distribution Date: Aggregate Stated Principal Balance of the
April 15, 1998 Mortgage Loans as of the Closing Date
("Initial Pool Balance"): $838,800,140
Servicer: Trustee and REMIC Administrator:
Bank One Mortgage Norwest Bank Minnesota, National
Capital Markets, LLC Association
Special Servicer:
Clarion Partners, LLC
Certificate No. [A-1A][A-1B]-___ CUSIP No.: ________________
A-2-1
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR
ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN DLJ
COMMERCIAL MORTGAGE CORP., BANC ONE MORTGAGE CAPITAL MARKETS, LLC, CLARION
PARTNERS, LLC, NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR ANY OF THE UNDERLYING
MORTGAGE LOANS IS GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
STATES OR ANY OTHER PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
[THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE
U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS
CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 2, 1998. ASSUMING THAT
THE MORTGAGE LOANS ARE NOT SUBJECT TO ANY VOLUNTARY OR INVOLUNTARY PREPAYMENT OF
PRINCIPAL (EXCEPT THAT THE ARD LOANS ARE ASSUMED TO BE PAID IN FULL ON THEIR
RESPECTIVE ANTICIPATED REPAYMENT DATES), THIS CERTIFICATE HAS BEEN ISSUED WITH
NO MORE THAN $______ OF OID PER $1,000 OF INITIAL CERTIFICATE PRINCIPAL BALANCE,
THE YIELD TO MATURITY IS ____% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO
THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $____ PER $1,000 OF INITIAL
CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER THE EXACT METHOD. NO
REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL NOT PREPAY OR, IF THEY DO
PREPAY, THAT THEY WILL PREPAY AT ANY PARTICULAR RATE.]
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
A-2-2
<PAGE>
This certifies that CEDE & CO. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the principal
amount of this Certificate (its "Certificate Principal Balance") as of the
Closing Date by the aggregate principal amount of all the Class [A-1A] [A-1B]
Certificates (their "Class Principal Balance") as of the Closing Date) in that
certain beneficial ownership interest in the Trust Fund evidenced by all the
Class [A-1A] [A- 1B]Certificates. The Trust Fund was created and the
Certificates were issued pursuant to a Pooling and Servicing Agreement, dated as
of the Cut-off Date specified above (the "Agreement"), among DLJ Commercial
Mortgage Corp. (the "Depositor", which term includes any successor entity under
the Agreement), Banc One Mortgage Capital Markets, LLC (the "Servicer", which
term includes any successor entity under the Agreement), Clarion Partners, LLC
(the "Special Servicer", which term includes any successor entity under the
Agreement) and Norwest Bank Minnesota, National Association (the "Trustee" and
"REMIC Administrator", depending upon the capacity in which it is acting, each
of which terms includes any successor entity under the Agreement), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, capitalized terms used herein have the respective
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to all the Holders of the
Class [A-1A] [A-1B] Certificates on the applicable Distribution Date pursuant to
the Agreement. All distributions made under the Agreement on this Certificate
will be made by the Trustee by wire transfer of immediately available funds to
the account of the Person entitled thereto at a bank or other entity having
appropriate facilities therefor, if such Certificateholder shall have provided
the Trustee with wiring instructions no less than five Business Days prior to
the related Record Date (which wiring instructions may be in the form of a
standing order applicable to all subsequent distributions), or otherwise by
check mailed to the address of such Certificateholder as it appears in the
Certificate Register. Notwithstanding the foregoing, the final distribution on
this Certificate (determined without regard to any possible future reimbursement
of any Realized Loss or Additional Trust Fund Expense previously allocated to
this Certificate) will be made in like manner, but only upon presentation and
surrender of this Certificate at the offices of the Certificate Registrar or
such other location specified in the notice to the Holder hereof of such final
distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Distribution Account, the Collection Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement
A-2-3
<PAGE>
of advances made, or certain expenses incurred, with respect to the Mortgage
Loans and the payment of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of the
Certificate Principal Balance hereof is binding on such Holder and all future
Holders of this Certificate and any Certificate issued upon the transfer hereof
or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
This Certificate is issuable in fully registered form only without coupons.
As provided in the Agreement and subject to certain limitations therein set
forth, this Certificate is exchangeable for new Certificates of the same Class
in authorized denominations evidencing the same aggregate Percentage Interest,
as requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer or
exchange of this Certificate, but the Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of this
Certificate.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC, and accordingly, this
Certificate shall constitute a Book-Entry Certificate.
The Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent, the Certificate Registrar and any agent of the
Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent or the Certificate Registrar may treat the
Person in whose name this Certificate is registered as the owner hereof for all
purposes, and none of the Depositor, the Servicer, the Special Servicer, the
Trustee, the REMIC Administrator, any Fiscal Agent, the Certificate Registrar or
any such agent shall be affected by notice to the contrary.
Subject to certain terms and conditions set forth in the Agreement, the
Trust Fund and the obligations created by the Agreement shall terminate upon
distribution (or provision for distribution) to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be distributed to
them pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Servicer, the Special Servicer or the
A-2-4
<PAGE>
Majority Certificateholder of the Controlling Class, at a price determined as
provided in the Agreement, of all the Mortgage Loans and each REO Property
remaining in the Trust Fund. The Agreement permits, but does not require, the
Servicer, the Special Servicer or the Majority Certificateholder of the
Controlling Class to purchase from the Trust Fund all the Mortgage Loans and
each REO Property remaining therein. The exercise of such right may effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Stated Principal Balance of the Mortgage Pool at the time of
purchase being less than 1.0% of the Initial Pool Balance.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Special Servicer, the REMIC Administrator, the
Trustee and any Fiscal Agent and the rights of the Certificateholders under the
Agreement at any time by the Depositor, the Servicer, the Special Servicer, the
REMIC Administrator, the Trustee and any Fiscal Agent with the consent of the
Holders of Certificates entitled to not less than 662/3% of the Voting Rights
allocated to all of the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of any REMIC Pool as a REMIC, without the consent of the
Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that it will
look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the substantive laws
of the State of New York applicable to agreements made and to be performed
entirely in said State, and the obligations, rights and remedies of the Holder
hereof shall be determined in accordance with such laws.
A-2-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Trustee
By: ________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class [A-1A] [A-1B] Certificates referred to in the
within-mentioned Agreement.
Dated:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By: ________________________________
Authorized Officer
A-2-6
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
______________________________________
Signature by or on behalf of Assignor
______________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to _____________________________________________
________________________________________________________________________________
for the account of ____________________________________________________________.
Distributions made by check (such check to be made payable to _____________
___________________) and all applicable statements and notices should be mailed
to _________________________________________________________.
This information is provided by _______________________, the Assignee named
above, or ____________________________, as its agent.
A-2-7
<PAGE>
EXHIBIT A-3
FORM OF CLASS A-2, CLASS A-3, CLASS B-1
AND CLASS B-2 CERTIFICATES
CLASS [A-2] [A-3] [B-1] [B-2] COMMERCIAL MORTGAGE
PASS-THROUGH CERTIFICATE, SERIES 1998-CF1
This is one of a series of commercial mortgage pass-through certificates
(collectively, the "Certificates"), issued in multiple classes (each, a
"Class"), which series of Certificates evidences the entire beneficial ownership
interest in a trust fund (the "Trust Fund") consisting primarily of a pool of
multifamily and commercial mortgage loans (the "Mortgage Loans"), such pool
being formed and sold by
DLJ COMMERCIAL MORTGAGE CORP.
<TABLE>
<S> <C>
Pass-Through Rate: Class Principal Balance of the Class [A-2] [A-
Variable 3] [B-1] [B-2] Certificates as of the Closing
Date: $_________________
Cut-off Date: March 1, 1998 Initial Certificate Principal Balance of this
Closing Date: March 2, 1998 Certificate as of the Closing Date:
$_________________
First Distribution Date: Aggregate Stated Principal Balance of the
April 15, 1998 Mortgage Loans as of the Closing Date
("Initial Pool Balance"): $838,800,140
Servicer: Trustee and REMIC Administrator:
Bank One Mortgage Capital Markets, LLC Norwest Bank Minnesota, National
Association
Special Servicer:
Clarion Partners, LLC
Certificate No. [A-2] [A-3] [B-1] [B-2]-__ CUSIP No.: ________________
</TABLE>
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<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR
ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT THAT IS SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE"), OR (B) TO ANY PERSON WHO IS DIRECTLY
OR INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH INTEREST HEREIN ON BEHALF OF,
AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF ANY SUCH EMPLOYEE
BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN DLJ
COMMERCIAL MORTGAGE CORP., BANC ONE MORTGAGE CAPITAL MARKETS, LLC, CLARION
PARTNERS, LLC, NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR ANY OF THE UNDERLYING
MORTGAGE LOANS IS GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO ONE OR MORE CLASSES OF CERTIFICATES OF THE
SAME SERIES AS AND TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
[THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE
U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS
CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 2, 1998. ASSUMING THAT
THE MORTGAGE LOANS ARE NOT SUBJECT TO ANY VOLUNTARY OR INVOLUNTARY PREPAYMENT OF
PRINCIPAL (EXCEPT
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<PAGE>
THAT THE ARD LOANS ARE ASSUMED TO BE PAID IN FULL ON THEIR RESPECTIVE
ANTICIPATED REPAYMENT DATES), THIS CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN
$______ OF OID PER $1,000 OF INITIAL CERTIFICATE PRINCIPAL BALANCE, THE YIELD TO
MATURITY IS ____% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL
ACCRUAL PERIOD IS NO MORE THAN $____ PER $1,000 OF INITIAL CERTIFICATE PRINCIPAL
BALANCE, COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION IS MADE THAT THE
MORTGAGE LOANS WILL NOT PREPAY OR, IF THEY DO PREPAY, THAT THEY WILL PREPAY AT
ANY PARTICULAR RATE.]
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
This certifies that CEDE & CO. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the principal
amount of this Certificate (its "Certificate Principal Balance") as of the
Closing Date by the aggregate principal amount of all the Class [A-2] [A-3]
[B-1] [B-2] Certificates (their "Class Principal Balance") as of the Closing
Date) in that certain beneficial ownership interest in the Trust Fund evidenced
by all the Class [A-2] [A-3] [B-1] [B-2] Certificates. The Trust Fund was
created and the Certificates were issued pursuant to a Pooling and Servicing
Agreement, dated as of the Cut-off Date specified above (the "Agreement"), among
DLJ Commercial Mortgage Corp. (the "Depositor", which term includes any
successor entity under the Agreement), Banc One Mortgage Capital Markets, LLC
(the "Servicer", which term includes any successor entity under the Agreement),
Clarion Partners, LLC (the "Special Servicer", which term includes any successor
entity under the Agreement) and Norwest Bank Minnesota, National Association
(the "Trustee" and "REMIC Administrator", depending upon the capacity in which
it is acting, each of which terms includes any successor entity under the
Agreement), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, capitalized terms used herein
have the respective meanings assigned in the Agreement. This Certificate is
issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of its
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to all the Holders of the
Class [A-2] [A-3] [B-1] [B-2] Certificates on the applicable Distribution Date
pursuant to the Agreement. All distributions made under the Agreement on this
Certificate will be made by the Trustee by wire transfer of immediately
available funds to the account of the Person entitled thereto at a bank or other
entity having appropriate facilities therefor, if such Certificateholder shall
have provided the Trustee with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such
A-3-3
<PAGE>
Certificateholder as it appears in the Certificate Register. Notwithstanding the
foregoing, the final distribution on this Certificate (determined without regard
to any possible future reimbursement of any Realized Loss or Additional Trust
Fund Expense previously allocated to this Certificate) will be made in like
manner, but only upon presentation and surrender of this Certificate at the
offices of the Certificate Registrar or such other location specified in the
notice to the Holder hereof of such final distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Distribution Account, the Collection Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of the
Certificate Principal Balance hereof is binding on such Holder and all future
Holders of this Certificate and any Certificate issued upon the transfer hereof
or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
This Certificate is issuable in fully registered form only without coupons.
As provided in the Agreement and subject to certain limitations therein set
forth, this Certificate is exchangeable for new Certificates of the same Class
in authorized denominations evidencing the same aggregate Percentage Interest,
as requested by the Holder surrendering the same.
No transfer of this Certificate or any interest therein shall be made (A)
to any employee benefit plan or other retirement arrangement, including
individual retirement accounts and annuities, Keogh plans and collective
investment funds and separate accounts in which such plans, accounts or
arrangements are invested, including insurance company general accounts, that is
subject to ERISA or the Code (each, a "Plan"), or (B) to any Person who is
directly or indirectly purchasing this Certificate or any interest herein on
behalf of, as named fiduciary of, as trustee of, or with assets of a Plan, if
the purchase and holding of this Certificate or such interest herein by the
prospective Transferee would result in a violation of Section 406 of ERISA or
Section 4975 of the Code or would result in the imposition of an excise tax
under Section 4975 of the Code. Except in connection with the initial issuance
of the Certificates or any transfer of this Certificate or any interest herein
by the Depositor, Donaldson, Lufkin & Jenrette Securities Corporation (the
"Underwriter") or any of their respective Affiliates or any transfer of this
Certificate to a successor Depository or to the applicable Certificate Owner in
accordance with Section 5.03 of the Agreement, the Certificate Registrar shall
refuse to register the transfer of this Certificate unless it has received from
the prospective Transferee either (i) a certification to the effect that such
prospective Transferee is not a Plan and is not directly or indirectly
purchasing this Certificate on behalf of, as named fiduciary of, as trustee of,
or with assets of a Plan; or (ii) a certification to the effect that the
purchase and holding of this Certificate by such prospective Transferee is
exempt from the prohibited transaction provisions of Section 406 of ERISA and
Section 4975 of the Code under Sections I and III of Prohibited Transaction
Class Exemption 95-60; or (iii) a certification of facts and an Opinion of
Counsel which
A-3-4
<PAGE>
otherwise establish to the reasonable satisfaction of the Trustee that such
transfer will not result in a violation of Section 406 of ERISA or Section 4975
of the Code or result in the imposition of an excise tax under Section 4975 of
the Code. If any Transferee of this Certificate or any interest herein does not,
in connection with the subject transfer, deliver to the Certificate Registrar a
certification and/or Opinion of Counsel as required by the preceding sentence,
then such Transferee shall be deemed to have represented and warranted that
either: (i) such Transferee is not a Plan and is not directly or indirectly
purchasing this Certificate or such interest herein on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan; or (ii) the purchase and
holding of this Certificate or such interest herein by such Transferee is exempt
from the prohibited transaction provisions of Section 406 of ERISA and Section
4975 of the Code under Sections I and III of Prohibited Transactions Class
Exemption 95-60.
If a Person is acquiring this Certificate as a fiduciary or agent for one
or more accounts, such Person shall be required to deliver to the Certificate
Registrar a certification to the effect that, and such other evidence as may be
reasonably required by the Trustee to confirm that, it has (i) sole investment
discretion with respect to each such account and (ii) full power to make the
foregoing acknowledgments, representations, warranties, certifications and/or
agreements with respect to each such account as described in the preceding
paragraph.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer or
exchange of this Certificate, but the Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of this
Certificate.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC, and accordingly, this
Certificate shall constitute a Book-Entry Certificate.
The Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent, the Certificate Registrar and any agent of the
Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent or the Certificate Registrar may treat the
Person in whose name this Certificate is registered as the owner hereof for all
purposes, and none of the Depositor, the Servicer, the Special Servicer, the
Trustee, the REMIC Administrator, any Fiscal Agent, the Certificate Registrar or
any such agent shall be affected by notice to the contrary.
A-3-5
<PAGE>
Subject to certain terms and conditions set forth in the Agreement, the
Trust Fund and the obligations created by the Agreement shall terminate upon
distribution (or provision for distribution) to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be distributed to
them pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Servicer, the Special Servicer or the Majority Certificateholder of the
Controlling Class, at a price determined as provided in the Agreement, of all
the Mortgage Loans and each REO Property remaining in the Trust Fund. The
Agreement permits, but does not require, the Servicer, the Special Servicer or
the Majority Certificateholder of the Controlling Class to purchase from the
Trust Fund all the Mortgage Loans and each REO Property remaining therein. The
exercise of such right may effect early retirement of the Certificates; however,
such right to purchase is subject to the aggregate Stated Principal Balance of
the Mortgage Pool at the time of purchase being less than 1.0% of the Initial
Pool Balance.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Special Servicer, the REMIC Administrator, the
Trustee and any Fiscal Agent and the rights of the Certificateholders under the
Agreement at any time by the Depositor, the Servicer, the Special Servicer, the
REMIC Administrator, the Trustee and any Fiscal Agent with the consent of the
Holders of Certificates entitled to not less than 662/3% of the Voting Rights
allocated to all of the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of any REMIC Pool as a REMIC, without the consent of the
Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that it will
look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the substantive laws
of the State of New York applicable to agreements made and to be performed
entirely in said State, and the obligations, rights and remedies of the Holder
hereof shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Trustee
By: ________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class [A-2] [A-3] [B-1] [B-2] Certificates referred to
in the within-mentioned Agreement.
Dated:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By: ________________________________
Authorized Officer
A-3-7
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to ____________________________________________
________________________________________________________________________________
for the account of ____________________________________________________________.
Distributions made by check (such check to be made payable to _____________
____________________________) and all applicable statements and notices
should be mailed to ___________________________________________________________.
This information is provided by _______________________, the Assignee named
above, or ____________________, as its agent.
A-3-8
<PAGE>
EXHIBIT A-4
FORM OF CLASS B-3, CLASS B-4, CLASS B-5,
CLASS B-6, CLASS B-7 AND CLASS C CERTIFICATES
CLASS [B-3] [B-4] [B-5] [B-6] [B-7] [C] COMMERCIAL MORTGAGE
PASS-THROUGH CERTIFICATE, SERIES 1998-CF1
This is one of a series of commercial mortgage pass-through certificates
(collectively, the "Certificates"), issued in multiple classes (each, a
"Class"), which series of Certificates evidences the entire beneficial ownership
interest in a trust fund (the "Trust Fund") consisting primarily of a pool of
multifamily and commercial mortgage loans (the "Mortgage Loans"), such pool
being formed and sold by
DLJ COMMERCIAL MORTGAGE CORP.
<TABLE>
<S> <C>
Pass-Through Rate: Class Principal Balance of the Class
[Variable [FOR CLASS B-3 AND CLASS B-4 [B-3] [B-4] [B-5] [B-6] [B-7] [C]
CERTIFICATES] Certificates as of the Closing Date:
[_______% per annum [FOR CLASS B-5, B-6, $_____________________
CLASS B-7 AND CLASS C CERTIFICATES]
Cut-off Date: March 1, 1998 Initial Certificate Principal Balance of this
Closing Date: March 2, 1998 Certificate as of the Closing Date:
$_________________
First Distribution Date: Aggregate Stated Principal Balance of the
April 15, 1998 Mortgage Loans as of the Closing Date
("Initial Pool Balance"): $838,800,140
Servicer: Trustee and REMIC Administrator:
Banc One Mortgage Capital Markets, LLC Norwest Bank Minnesota, National
Association
Special Servicer:
Clarion Partners, LLC
Certificate No. [B-3] [B-4] [B-5] [B-6] [B-7] CUSIP No.: ___________
[C]-___
</TABLE>
A-4-1
<PAGE>
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE.
ANY RESALE, PLEDGE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE OR ANY
INTEREST HEREIN WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A
TRANSACTION WHICH DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND WHICH
IS IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT THAT IS SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE"), OR (B) TO ANY PERSON WHO IS DIRECTLY
OR INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH INTEREST HEREIN ON BEHALF OF,
AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF ANY SUCH EMPLOYEE
BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN DLJ
COMMERCIAL MORTGAGE CORP., BANC ONE MORTGAGE CAPITAL MARKETS, LLC, CLARION
PARTNERS, LLC, NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR ANY OF THE UNDERLYING
MORTGAGE LOANS IS GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO ONE OR MORE CLASSES OF CERTIFICATES OF THE
SAME SERIES AS AND TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
[THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE
U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS
CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 2, 1998. ASSUMING THAT
THE MORTGAGE LOANS ARE NOT SUBJECT TO ANY VOLUNTARY OR INVOLUNTARY PREPAYMENT OF
PRINCIPAL (EXCEPT THAT THE ARD LOANS ARE ASSUMED TO BE PAID IN FULL ON THEIR
RESPECTIVE ANTICIPATED REPAYMENT DATES), THIS CERTIFICATE HAS BEEN ISSUED WITH
NO MORE THAN $______ OF OID PER $1,000 OF INITIAL
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<PAGE>
CERTIFICATE PRINCIPAL BALANCE, THE YIELD TO MATURITY IS ____% PER ANNUM, AND THE
AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $____
PER $1,000 OF INITIAL CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER THE EXACT
METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL NOT PREPAY OR, IF
THEY DO PREPAY, THAT THEY WILL PREPAY AT ANY PARTICULAR RATE.]
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
This certifies that __________________ is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
principal amount of this Certificate (its "Certificate Principal Balance") as of
the Closing Date by the aggregate principal amount of all the Class [B-3] [B-4]
[B-5] [B-6] [B-7] [C] Certificates (their "Class Principal Balance") as of the
Closing Date) in that certain beneficial ownership interest in the Trust Fund
evidenced by all the Class [B-3] [B-4] [B-5] [B-6] [B-7] [C] Certificates. The
Trust Fund was created and the Certificates were issued pursuant to a Pooling
and Servicing Agreement, dated as of the Cut-off Date specified above (the
"Agreement"), among DLJ Commercial Mortgage Corp. (the "Depositor", which term
includes any successor entity under the Agreement), Banc One Mortgage Capital
Markets, LLC (the "Servicer", which term includes any successor entity under the
Agreement), Clarion Partners, LLC (the "Special Servicer", which term includes
any successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (the "Trustee" and "REMIC Administrator", depending upon the
capacity in which it is acting, each of which terms includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to all the Holders of the
Class [B-3] [B-4] [B-5] [B-6] [B-7] [C] Certificates on the applicable
Distribution Date pursuant to the Agreement. All distributions made under the
Agreement on this Certificate will be made by the Trustee by wire transfer of
immediately available funds to the account of the Person entitled thereto at a
bank or other entity having appropriate facilities therefor, if such
Certificateholder shall have provided the Trustee with wiring instructions no
less than five Business Days prior to the related Record Date (which wiring
instructions may be in the form of a standing order applicable to all subsequent
distributions), or otherwise by check mailed to the address of such
Certificateholder as it appears in the Certificate Register. Notwithstanding the
foregoing, the final distribution on this Certificate (determined without regard
to any possible future reimbursement of any Realized Loss or Additional Trust
Fund Expense previously allocated to this Certificate) will
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<PAGE>
be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to the Holder hereof of such final distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Distribution Account, the Collection Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of the
Certificate Principal Balance hereof is binding on such Holder and all future
Holders of this Certificate and any Certificate issued upon the transfer hereof
or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
This Certificate is issuable in fully registered form only without coupons.
As provided in the Agreement and subject to certain limitations therein set
forth, this Certificate is exchangeable for new Certificates of the same Class
in authorized denominations evidencing the same aggregate Percentage Interest,
as requested by the Holder surrendering the same.
No transfer, sale, pledge or other disposition of this Certificate or any
interest herein shall be made unless that transfer, sale, pledge or other
disposition is exempt from the registration and/or qualification requirements of
the Securities Act and any applicable state securities laws, or is otherwise
made in accordance with the Securities Act and such state securities laws. If a
transfer of this Certificate is to be made without registration under the
Securities Act (other than in connection with the initial issuance of the
Certificates or a transfer of this Certificate by the Depositor, Donaldson,
Lufkin & Jenrette Securities Corporation (the "Underwriter") or any of their
respective Affiliates), then the Certificate Registrar shall refuse to register
such transfer unless it receives (and, upon receipt, may conclusively rely upon)
either: (i) a certificate from the Certificateholder desiring to effect such
transfer substantially in the form attached as Exhibit F-1A to the Agreement; or
(ii) a certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit F-1B to the Agreement and a
certificate from such Certificateholder's prospective Transferee substantially
in the form attached either as Exhibit F-2A or as Exhibit F-2B to the Agreement;
or (iii) an Opinion of Counsel satisfactory to the Trustee to the effect that
such transfer may be made without registration under the Securities Act (which
Opinion of Counsel shall not be an expense of the Trust or of the Depositor, the
Servicer, the Special Servicer, the REMIC Administrator, the Trustee, any Fiscal
Agent or the Certificate Registrar in their respective capacities as such),
together with the written certification(s) as to the facts surrounding such
transfer from the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective Transferee on which such Opinion of Counsel is
based. If any Transferee of this Certificate does not, in connection with the
subject transfer, deliver to the Certificate Registrar one of the certifications
described in clause (ii) of the preceding sentence or the Opinion of Counsel
described in clause (iii) of the preceding sentence, then such Transferee shall
be deemed to have represented and warranted
A-4-4
<PAGE>
that all the certifications set forth in either Exhibit F-2A or Exhibit F-2B
attached to the Agreement are, with respect to the subject transfer, true and
correct. Any Certificateholder desiring to effect a transfer, sale, pledge or
other disposition of this Certificate or any interest herein shall, and does
hereby agree to, indemnify the Depositor, the Underwriter, the Trustee, any
Fiscal Agent, the Servicer, the Special Servicer, the REMIC Administrator and
the Certificate Registrar against any liability that may result if such
transfer, sale, pledge or other disposition is not exempt from the registration
and/or qualification requirements of the Securities Act and any applicable state
securities laws or is not made in accordance with such federal and state laws.
No transfer of this Certificate or any interest herein shall be made (A) to
any employee benefit plan or other retirement arrangement, including individual
retirement accounts and annuities, Keogh plans and collective investment funds
and separate accounts in which such plans, accounts or arrangements are
invested, including insurance company general accounts, that is subject to ERISA
or the Code (each, a "Plan"), or (B) to any Person who is directly or indirectly
purchasing this Certificate or such interest herein on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan, if the purchase and
holding of this Certificate or such interest herein by the prospective
Transferee would result in a violation of Section 406 of ERISA or Section 4975
of the Code or would result in the imposition of an excise tax under Section
4975 of the Code. Except in connection with the initial issuance of the
Certificates or any transfer of this Certificate or any interest herein by the
Depositor, the Underwriter or any of their respective Affiliates, the
Certificate Registrar shall refuse to register the transfer of this Certificate
unless it has received from the prospective Transferee either (i) a
certification to the effect that such prospective Transferee is not a Plan and
is not directly or indirectly purchasing this Certificate on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan; or (ii) a certification
to the effect that the purchase and holding of this Certificate by such
prospective Transferee is exempt from the prohibited transaction provisions of
Section 406 of ERISA and Section 4975 of the Code under Sections I and III of
Prohibited Transaction Class Exemption 95-60; or (iii) a certification of facts
and an Opinion of Counsel which otherwise establish to the reasonable
satisfaction of the Trustee that such transfer will not result in a violation of
Section 406 of ERISA or Section 4975 of the Code or result in the imposition of
an excise tax under Section 4975 of the Code. If any Transferee of this
Certificate or any interest herein does not, in connection with the subject
transfer, deliver to the Certificate Registrar a certification and/or Opinion of
Counsel as required by the preceding sentence, then such Transferee shall be
deemed to have represented and warranted that either: (i) such Transferee is not
a Plan and is not directly or indirectly purchasing this Certificate or such
interest herein on behalf of, as named fiduciary of, as trustee of, or with
assets of a Plan; or (ii) the purchase and holding of this Certificate or such
interest herein by such Transferee is exempt from the prohibited transaction
provisions of Section 406 of ERISA and Section 4975 of the Code under Sections I
and III of Prohibited Transactions Class Exemption 95-60.
If a Person is acquiring this Certificate as a fiduciary or agent for one
or more accounts, such Person shall be required to deliver to the Certificate
Registrar a certification to the effect that, and such other evidence as may be
reasonably required by the Trustee to confirm that, it has (i) sole investment
discretion with respect to each such account and (ii) full power to make the
foregoing acknowledgments, representations, warranties, certifications and/or
agreements with respect to each such account as described in the two preceding
paragraphs.
A-4-5
<PAGE>
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer or
exchange of this Certificate, but the Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of this
Certificate.
The Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent, the Certificate Registrar and any agent of the
Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent or the Certificate Registrar may treat the
Person in whose name this Certificate is registered as the owner hereof for all
purposes, and none of the Depositor, the Servicer, the Special Servicer, the
Trustee, the REMIC Administrator, any Fiscal Agent, the Certificate Registrar or
any such agent shall be affected by notice to the contrary.
Subject to certain terms and conditions set forth in the Agreement, the
Trust Fund and the obligations created by the Agreement shall terminate upon
distribution (or provision for distribution) to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be distributed to
them pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Servicer, the Special Servicer or the Majority Certificateholder of the
Controlling Class, at a price determined as provided in the Agreement, of all
the Mortgage Loans and each REO Property remaining in the Trust Fund. The
Agreement permits, but does not require, the Servicer, the Special Servicer or
the Majority Certificateholder of the Controlling Class to purchase from the
Trust Fund all the Mortgage Loans and each REO Property remaining therein. The
exercise of such right may effect early retirement of the Certificates; however,
such right to purchase is subject to the aggregate Stated Principal Balance of
the Mortgage Pool at the time of purchase being less than 1.0% of the Initial
Pool Balance.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Special Servicer, the REMIC Administrator, the
Trustee and any Fiscal Agent and the rights of the Certificateholders under the
Agreement at any time by the Depositor, the Servicer, the Special Servicer, the
REMIC Administrator, the Trustee and any Fiscal Agent with the consent of the
Holders of Certificates entitled to not less than 662/3% of the Voting Rights
allocated to all of the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances,
A-4-6
<PAGE>
including any amendment necessary to maintain the status of any REMIC Pool as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that it will
look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the substantive laws
of the State of New York applicable to agreements made and to be performed
entirely in said State, and the obligations, rights and remedies of the Holder
hereof shall be determined in accordance with such laws.
A-4-7
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Trustee
By: ________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class [B-3] [B-4] [B-5] [B-6] [B-7] [C] Certificates
referred to in the within-mentioned Agreement.
Dated:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By: ________________________________
Authorized Officer
A-4-8
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to _____________________________________________
________________________________________________________________________________
for the account of ____________________________________________________________.
Distributions made by check (such check to be made payable to _____________
___________________) and all applicable statements and notices should be
mailed to ____________________________________________________________________.
This information is provided by _______________________, the Assignee named
above, or ______________________________, as its agent.
A-4-9
<PAGE>
EXHIBIT A-5
FORM OF CLASS R-I, CLASS R-II AND CLASS R-III CERTIFICATES
CLASS [R-I] [R-II] [R-III] COMMERCIAL MORTGAGE
PASS-THROUGH CERTIFICATE, SERIES 1998-CF1
This is one of a series of commercial mortgage pass-through certificates
(collectively, the "Certificates"), issued in multiple classes (each, a
"Class"), which series of Certificates evidences the entire beneficial ownership
interest in a trust fund (the "Trust Fund") consisting primarily of a pool of
multifamily and commercial mortgage loans (the "Mortgage Loans"), such pool
being formed and sold by
DLJ COMMERCIAL MORTGAGE CORP.
Cut-off Date: March 1, 1998 Percentage Interest evidenced by
this Certificate: ___%
Closing Date: March 2, 1998 Aggregate Stated Principal Balance of the
Mortgage Loans as of the Closing Date
("Initial Pool Balance"): $838,800,140
First Distribution Date: Trustee and REMIC Administrator:
April 15, 1998 Norwest Bank Minnesota, National
Association
Servicer:
Banc One Mortgage
Capital Markets, LLC
Special Servicer:
Clarion Partners, LLC
Certificate No. [R-I] [R-II]
[R-III] -__
A-5-1
<PAGE>
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE.
ANY RESALE, PLEDGE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE OR ANY
INTEREST HEREIN WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A
TRANSACTION WHICH DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND WHICH
IS IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT THAT IS SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE"), OR (B) TO ANY PERSON WHO IS DIRECTLY
OR INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH INTEREST HEREIN ON BEHALF OF,
AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF ANY SUCH EMPLOYEE
BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN DLJ
COMMERCIAL MORTGAGE CORP., BANC ONE MORTGAGE CAPITAL MARKETS, LLC, CLARION
PARTNERS, LLC, NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR ANY OF THE UNDERLYING
MORTGAGE LOANS IS GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO ONE OR MORE CLASSES OF CERTIFICATES OF THE
SAME SERIES AS AND TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH TRANSFER
RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS, IF ANY,
ON THIS CERTIFICATE.
A-5-2
<PAGE>
This certifies that __________________ is the registered owner of the
Percentage Interest evidenced by this Certificate (as specified above) in that
certain beneficial ownership interest in the Trust Fund evidenced by all the
Class [R-I] [R-II ][R-III] Certificates. The Trust Fund was created and the
Certificates were issued pursuant to a Pooling and Servicing Agreement, dated as
of the Cut-off Date specified above (the "Agreement"), among DLJ Commercial
Mortgage Corp. (the "Depositor", which term includes any successor entity under
the Agreement), Banc One Mortgage Capital Markets, LLC (the "Servicer", which
term includes any successor entity under the Agreement) and Clarion Partners,
LLC (the "Special Servicer", which term includes any successor entity under the
Agreement) and Norwest Bank Minnesota, National Association (the "Trustee" and
"REMIC Administrator", depending upon the capacity in which it is acting, each
of which terms includes any successor entity under the Agreement), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, capitalized terms used herein have the respective
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to all the Holders of the
Class [R-I] [R-II] [R-III] Certificates on the applicable Distribution Date
pursuant to the Agreement. All distributions made under the Agreement on this
Certificate will be made by the Trustee by wire transfer of immediately
available funds to the account of the Person entitled thereto at a bank or other
entity having appropriate facilities therefor, if such Certificateholder shall
have provided the Trustee with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate will be made in like manner, but only upon
presentation and surrender of this Certificate at the offices of the Certificate
Registrar or such other location specified in the notice to the Holder hereof of
such final distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Distribution Account, the Collection Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
A-5-3
<PAGE>
This Certificate is issuable in fully registered form only without coupons.
As provided in the Agreement and subject to certain limitations therein set
forth, this Certificate is exchangeable for new Certificates of the same Class
in authorized denominations evidencing the same aggregate Percentage Interest,
as requested by the Holder surrendering the same.
No transfer, sale, pledge or other disposition of this Certificate or any
interest herein shall be made unless that transfer, sale, pledge or other
disposition is exempt from the registration and/or qualification requirements of
the Securities Act and any applicable state securities laws, or is otherwise
made in accordance with the Securities Act and such state securities laws. If a
transfer of this Certificate is to be made without registration under the
Securities Act (other than in connection with the initial issuance of the
Certificates or a transfer of this Certificate by the Depositor, Donaldson,
Lufkin & Jenrette Securities Corporation (the "Underwriter") or any of their
respective Affiliates), then the Certificate Registrar shall refuse to register
such transfer unless it receives (and, upon receipt, may conclusively rely upon)
either: (i) a certificate from the Certificateholder desiring to effect such
transfer substantially in the form attached as Exhibit F-1A to the Agreement; or
(ii) a certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit F-1B to the Agreement and a
certificate from such Certificateholder's prospective Transferee substantially
in the form attached either as Exhibit F-2A or as Exhibit F-2B to the Agreement;
or (iii) an Opinion of Counsel satisfactory to the Trustee to the effect that
such transfer may be made without registration under the Securities Act (which
Opinion of Counsel shall not be an expense of the Trust or of the Depositor, the
Servicer, the Special Servicer, the REMIC Administrator, the Trustee, any Fiscal
Agent or the Certificate Registrar in their respective capacities as such),
together with the written certification(s) as to the facts surrounding such
transfer from the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective Transferee on which such Opinion of Counsel is
based. If any Transferee of this Certificate does not, in connection with the
subject transfer, deliver to the Certificate Registrar one of the certifications
described in clause (ii) of the preceding sentence or the Opinion of Counsel
described in clause (iii) of the preceding sentence, then such Transferee shall
be deemed to have represented and warranted that all the certifications set
forth in either Exhibit F-2A or Exhibit F-2B attached to the Agreement are, with
respect to the subject transfer, true and correct. Any Certificateholder
desiring to effect a transfer, sale, pledge or other disposition of this
Certificate or any interest herein shall, and does hereby agree to, indemnify
the Depositor, the Underwriter, the Trustee, any Fiscal Agent, the Servicer, the
Special Servicer, the REMIC Administrator and the Certificate Registrar against
any liability that may result if such transfer, sale, pledge or other
disposition is not exempt from the registration and/or qualification
requirements of the Securities Act and any applicable state securities laws or
is not made in accordance with such federal and state laws.
No transfer of this Certificate or any interest herein shall be made (A) to
any employee benefit plan or other retirement arrangement, including individual
retirement accounts and annuities, Keogh plans and collective investment funds
and separate accounts in which such plans, accounts or arrangements are
invested, including insurance company general accounts, that is subject to ERISA
or the Code (each, a "Plan"), or (B) to any Person who is directly or indirectly
purchasing this Certificate or such interest herein on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan, if the purchase and
holding of this Certificate or such interest herein by the prospective
Transferee would result in a violation of Section 406 of ERISA or Section 4975
of the Code or
A-5-4
<PAGE>
would result in the imposition of an excise tax under Section 4975 of the Code.
Except in connection with the initial issuance of the Certificates or any
transfer of this Certificate or any interest herein by the Depositor, the
Underwriter or any of their respective Affiliates, the Certificate Registrar
shall refuse to register the transfer of this Certificate unless it has received
from the prospective Transferee either: (i) a certification to the effect that
such prospective Transferee is not a Plan and is not directly or indirectly
purchasing this Certificate on behalf of, as named fiduciary of, as trustee of,
or with assets of a Plan; or (ii) a certification to the effect that the
purchase and holding of this Certificate by such prospective Transferee is
exempt from the prohibited transaction provisions of Section 406 of ERISA and
Section 4975 of the Code under Sections I and III of Prohibited Transaction
Class Exemption 95-60; or (iii) a certification of facts and an Opinion of
Counsel which otherwise establish to the reasonable satisfaction of the Trustee
that such transfer will not result in a violation of Section 406 of ERISA or
Section 4975 of the Code or result in the imposition of an excise tax under
Section 4975 of the Code. If any Transferee of this Certificate or any interest
herein does not, in connection with the subject transfer, deliver to the
Certificate Registrar a certification and/or Opinion of Counsel as required by
the preceding sentence, then such Transferee shall be deemed to have represented
and warranted that either: (i) such Transferee is not a Plan and is not directly
or indirectly purchasing this Certificate or such interest herein on behalf of,
as named fiduciary of, as trustee of, or with assets of a Plan; or (ii) the
purchase and holding of this Certificate or such interest herein by such
Transferee is exempt from the prohibited transaction provisions of Section 406
of ERISA and Section 4975 of the Code under Sections I and III of Prohibited
Transactions Class Exemption 95-60.
Each Person who has or who acquires any Ownership Interest in this
Certificate shall be deemed by its acceptance or acquisition of such Ownership
Interest to have agreed to be bound by the provisions of Section 5.02(d) of the
Agreement and, if any purported Transferee shall become a Holder of this
Certificate in violation of the provisions of such Section 5.02(d), to have
irrevocably authorized the Trustee under clause (ii)(A) of such Section 5.02(d)
to deliver payments to a Person other than such Person and to have irrevocably
authorized the Trustee under clause (ii)(B) of such Section 5.02(d) to negotiate
the terms of any mandatory disposition and to execute all instruments of
Transfer and to do all other things necessary in connection with any such
disposition. Each Person holding or acquiring any Ownership Interest in this
Certificate must be a Permitted Transferee and shall promptly notify the Trustee
and the REMIC Administrator of any change or impending change in its status as a
Permitted Transferee. In connection with any proposed Transfer of any Ownership
Interest in this Certificate, the Certificate Registrar shall require delivery
to it, and shall not register the Transfer of this Certificate until its receipt
of, an affidavit and agreement substantially in the form attached as Exhibit H-1
to the Agreement (a "Transfer Affidavit and Agreement") from the proposed
Transferee, representing and warranting, among other things, that such
Transferee is a Permitted Transferee, that it is not acquiring its Ownership
Interest in this Certificate as a nominee, trustee or agent for any Person that
is not a Permitted Transferee, that for so long as it retains its Ownership
Interest in this Certificate, it will endeavor to remain a Permitted Transferee,
and that it has reviewed the provisions of Section 5.02(d) of the Agreement and
agrees to be bound by them. Notwithstanding the delivery of a Transfer Affidavit
and Agreement by a proposed Transferee, if a Responsible Officer of either the
Certificate Registrar or Trustee has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in this Certificate to such proposed Transferee shall be effected.
A-5-5
<PAGE>
Each Person holding or acquiring any Ownership Interest in this Certificate
shall agree (x) to require a Transfer Affidavit and Agreement from any other
Person to whom such Person attempts to transfer its Ownership Interest herein
and (y) not to transfer its Ownership Interest herein unless it provides to the
Certificate Registrar a certificate substantially in the form attached as
Exhibit H-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Trustee and the REMIC
Administrator written notice that it is a "pass-through interest holder" within
the meaning of temporary Treasury regulation Section 1.67-3T(a)(2)(i)(A)
immediately upon acquiring such Ownership Interest, if it is, or is holding such
Ownership Interest on behalf of, a "pass-through interest holder".
If a Person is acquiring this Certificate as a fiduciary or agent for one
or more accounts, such Person shall be required to deliver to the Certificate
Registrar a certification to the effect that, and such other evidence as may be
reasonably required by the Trustee to confirm that, it has (i) sole investment
discretion with respect to each such account and (ii) full power to make the
foregoing acknowledgments, representations, warranties, certifications and/or
agreements with respect to each such account as described in the four preceding
paragraphs.
The provisions of Section 5.02(d) of the Agreement may be modified, added
to or eliminated, provided that there shall have been delivered to the Trustee
and the REMIC Administrator the following: (a) written confirmation from each
Rating Agency to the effect that the modification of, addition to or elimination
of such provisions will not result in an Adverse Rating Event with respect to
any Class of Rated Certificates; and (b) an Opinion of Counsel, in form and
substance satisfactory to the Trustee and the REMIC Administrator, to the effect
that such modification of, addition to or elimination of such provisions will
not cause any REMIC Pool to cease to qualify as a REMIC or be subject to an
entity-level tax caused by the Transfer of a Residual Interest Certificate to a
Person that is not a Permitted Transferee, or cause a Person other than the
prospective Transferee to be subject to a REMIC-related tax caused by the
Transfer of a Residual Interest Certificate to a Person that is not a Permitted
Transferee.
A "Permitted Transferee" is any Transferee other than a "Disqualified
Organization" and a "Non-United States Person". A "Disqualified Organization" is
any of (i) the United States or a possession thereof, any State or political
subdivision thereof or any agency or instrumentality of any of the foregoing
(other than an instrumentality which is a corporation if all of its activities
are subject to tax and, except for FHLMC, a majority of its board of directors
is not selected by such governmental unit), (ii) a foreign government,
international organization, or any agency or instrumentality of any of the
foregoing, (iii) any organization (other than certain farmers' cooperatives
described in Section 521 of the Code) which is exempt from the tax imposed by
Chapter 1 of the Code (unless such organization is subject to the tax imposed by
Section 511 of the Code on unrelated business taxable income), (iv) rural
electric and telephone cooperatives described in Section 1381 of the Code and
(v) any other Person so designated by the REMIC Administrator based upon an
Opinion of Counsel that the holding of an Ownership Interest in a Residual
Interest Certificate by such Person may cause the Trust or any Person having an
Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code
A-5-6
<PAGE>
that would not otherwise be imposed but for the Transfer of an Ownership
Interest in a Residual Interest Certificate to such Person. The terms "United
States", "State" and "international organization" shall have the meanings set
forth in Section 7701 of the Code or successor provisions.
A "Non-United States Person" is any Person other than a United States
Person. A "United States Person" is a citizen or resident of the United States,
a corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, or an estate
whose income from sources without the United States is includible in gross
income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States, or
a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more United States
persons have the authority to control all substantial decisions of the trust,
all within the meaning of Section 7701(a)(30) of the Code.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer or
exchange of this Certificate, but the Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of this
Certificate.
The Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent, the Certificate Registrar and any agent of the
Depositor, the Servicer, the Special Servicer, the Trustee, the REMIC
Administrator, any Fiscal Agent or the Certificate Registrar may treat the
Person in whose name this Certificate is registered as the owner hereof for all
purposes, and none of the Depositor, the Servicer, the Special Servicer, the
Trustee, the REMIC Administrator, any Fiscal Agent, the Certificate Registrar or
any such agent shall be affected by notice to the contrary.
Subject to certain terms and conditions set forth in the Agreement, the
Trust Fund and the obligations created by the Agreement shall terminate upon
distribution (or provision for distribution) to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be distributed to
them pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Servicer, the Special Servicer or the Majority Certificateholder of the
Controlling Class, at a price determined as provided in the Agreement, of all
the Mortgage Loans and each REO Property remaining in the Trust Fund. The
Agreement permits, but does not require, the Servicer, the Special Servicer or
the Majority Certificateholder of the Controlling Class to purchase from the
Trust Fund all the Mortgage Loans
A-5-7
<PAGE>
and each REO Property remaining therein. The exercise of such right will effect
early retirement of the Certificates; however, such right to purchase is subject
to the aggregate Stated Principal Balance of the Mortgage Pool at the time of
purchase being less than 1.0% of the Initial Pool Balance.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Special Servicer, the REMIC Administrator, the
Trustee and any Fiscal Agent and the rights of the Certificateholders under the
Agreement at any time by the Depositor, the Servicer, the Special Servicer, the
REMIC Administrator, the Trustee and any Fiscal Agent with the consent of the
Holders of Certificates entitled to not less than 662/3% of the Voting Rights
allocated to all of the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of any REMIC Pool as a REMIC, without the consent of the
Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that it will
look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the substantive laws
of the State of New York applicable to agreements made and to be performed
entirely in said State, and the obligations, rights and remedies of the Holder
hereof shall be determined in accordance with such laws.
A-5-8
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Trustee
By: _______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class [R-I] [R-II] [R-III] Certificates referred to in
the within- mentioned Agreement.
Dated:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By: _______________________________
Authorized Officer
A-5-9
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to _____________________________________________
________________________________________________________________________________
for the account of ___________________________________________________________.
Distributions made by check (such check to be made payable to _______
__________________________) and all applicable statements and notices should be
mailed to _____________________________________________________________________.
This information is provided by _____________________________________,
the Assignee named above, or __________________________, as its agent.
A-5-10
<PAGE>
EXHIBIT B-1
MORTGAGE LOAN SCHEDULE
B-1-1
<PAGE>
Schedule B-1
Mortgage Loan Schedule
<TABLE>
<CAPTION>
# Property Name Address
- ------------- -------
<S> <C> <C>
1 Showboat Hotel & Casino, Atlantic City 801 Boardwalk
2 Stone Container - Santa Fe Springs (1A) 13833 East Freeway Drive
3 Stone Container - Mansfield (1A) 47 Maple Street
4 Stone Container - San Jose (1A) 1901 Junction Ave.
5 Stone Container - Minneapolis (1A) 50 37th Avenue N.E.
6 Stone Container - Springfield (1A) 2705 West Battlefield Road
7 Stone Container - Salinas (1A) 1078 Merrill Street
8 Stone Container - Harahan (1A) 5301 Jefferson Highway
9 Stone Container - Rogers (1A) 2021 South Fifth Street
10 Stone Container - Keokuk (1A) 3972 Main Street
11 Stone Container - Portland (1A) 74 Pickering Street
12 Stone Container - Saltillo (1A) Turner Industrial Park
13 Stone Container - Columbus (1A) 3101 State Street
14 Stone Container - North Tonawanda (1A) 7393 Shawnee Road
15 Stone Container - St. Cloud (1A) 655 41st Avenue North
16 Stone Container - Jackson (1A) 1345 Flowood Drive
17 Stone Container - Collierville (1A) 550 South Street East
18 Stone Container - Bloomington (1A) Route 150 South
19 Stone Container - Danville (1A) 1501 East Voorhees Street
20 Washington Marriott Hotel 1221 22nd Street, N.W.
21 Willow Creek Apartments (Foster Portfolio) (1B) 100 Stagecoach Road
22 Lake Park Apartments (1B) 549 Arbor Hill Road
23 Plaza South Apartments (1B) 3501 Plaza Hollow Drive
24 Farmwood Apartments (1B) 120 Farmwood Drive
25 Colony Apartments (1B) 4240 Brownsboro Road
26 Southwest Plaza I and II Shopping Center SWC Veterans Parkway & Wabash Avenue
27 The Rosedale Corporate Plaza 2685 Long Lake Road
28 Bayvue Apartments 1293 Bayside Avenue
29 Lake Calhoun Executive Center 3033 Excelsior Boulevard
30 Pebble Creek Apartments (1C) 2360 SW Archer Road
31 Homestead Apartments (1C) 3611 SW 34th Street
32 Shops at Lyndale Phase II (1D) NWC Interstate 494 and Lyndale Avenue
33 Shops at Lyndale Phase II - TIF (1D) NWC Interstate 494 and Lyndale Avenue
34 Walgreens - Kirkland (1E) 12405 NE 85TH Street
35 Walgreens Retail Pharmacy Store - San Francisco (1E) 1189 Potrero Avenue
36 Walgreens Retail Pharmacy Store - Charleston/Torrey (1E) 6401 Charleston Boulevard
37 Walgreens Retail Pharmacy Store - Las Vegas Boulevard (1E) 2280 Las Vegas Boulevard
38 Walgreens Retail/Pharmacy Store - Paradise (1E) 7576 Skyway
39 Country Village MHP 1463 South Village Court
40 414 N. Orleans St. 414 N. Orleans St.
41 Two Greenville Crossing (1F) 4001 Kennett Pike
42 One Greenville Crossing (1F) 4007-4025 Kennett Pike
43 Wesley Chapel Square 2375 Wesley Chapel Road
44 Mercado del Lago Shopping Center NWC of Santa Margarita & Antonio Parkways
45 Curry Honda Automobile Dealership (1G) 5525 Peachtree Industrial Boulevard
46 Curry Chevrolet Automobile Dealership (1G) 3845 Crompond Road
47 Curry Acura Automobile Dealership (1G) 685 Central Park Avenue
48 Curry Ford/Subaru Automobile Dealership (1G) 3493 Crompond Road
49 Curry Mitsubishi Automobile Dealership (1G) 3505 Crompond Road
50 Curry Office Building (1G) 721 Central Park Avenue
51 708 Broadway / 404 Lafayette Street 708 Broadway
52 360-386 East Fordham Road 360-386 East Fordham Road
53 Hampton Inn - Houston Galleria 4500 Post Oak Parkway
54 Holiday Inn Southwest and Viking Conference Center 10709 Watson Road
55 Valley Central Center NWC of Valley Central Way and Avenue J
56 Centrum Office Building 24901 Northwestern Highway
57 237-269 East Fordham Road 237-269 East Fordham Road
58 Dietrich Meadows S/C 13918-13952 Manchester Road
59 Schaumburg Villas Apartments 1010 Knollwood Drive
60 Vista Ridge Retail Center 2403 S. Stemmons Freeway
61 Trade Centre South 100 Trade Centre Drive
62 Loehman's Plaza 4076-4128 PGA Boulevard
63 Southwind Plaza 917/921 West Holmes & 3525/3615 South MLK Blvd
64 127th Street Shopping Center 12700 Biscayne Boulevard
65 Filene's Basement Distribution Center 26 Millbury Street
66 Holiday Inn Express Hotel 1401 Bloomfield Ave.
67 Forest Pines Retirement Residence 1720 Devonshire Drive
68 Hammond Springs Shopping Center 5975 Roswell Road
69 AMC Theater Complex 1310 Third Street
70 Roosevelt Plaza Shopping Center 6501 Roosevelt Boulevard
71 Johnson Square Office Park 1501 - 1523 Johnson Ferry Road
72 Comfort Inn - Cleveland 1800 Euclid Avenue
73 Gateway Business Center 1333 and 1335 Gateway Drive
74 Good Samaritan Medical Plaza 393 Blossom Hill Road
75 Spring Tree Apartments 1423 Graves Avenue
76 Walgreen's Plaza 3860-3954 Decoto Road
77 Candler McAfee Shopping Center 1950 Candler Road
78 Heritage Hills Apartments 3901 and 3909 Heritage Hills Drive
79 Big V Supermarket 486-496 Albany Post Road
80 1333 N. Kingsbury Street 1333 N. Kingsbury Street
<CAPTION>
Original Original
Principal Cut-off Date Monthly Mortgage Term to Stated
# City State Zip Code Balance Balance Payment Rate Term
- ---- ----- -------- ------- ------- ------- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 Atlantic City NJ 08401 $100,000,000 $99,880,087 $671,358 7.090% 360
2 Santa Fe Springs CA 90670 $4,500,000 $4,473,154 $36,084 8.450% 120
3 Mansfield MA 02048 $4,350,000 $4,324,049 $34,881 8.450% 120
4 San Jose CA 95131 $4,237,500 $4,212,220 $33,979 8.450% 120
5 Minneapolis MN 55421 $3,862,500 $3,839,457 $30,972 8.450% 120
6 Springfield MO 65807 $3,525,000 $3,503,971 $28,266 8.450% 120
7 Salinas CA 93912 $3,018,750 $3,000,741 $24,206 8.450% 120
8 Harahan LA 70123 $2,850,000 $2,832,998 $22,853 8.450% 120
9 Rogers AR 72756 $2,362,500 $2,348,406 $18,944 8.450% 120
10 Keokuk IA 52832 $1,762,500 $1,751,985 $14,133 8.450% 120
11 Portland CT 06480 $1,725,000 $1,714,709 $13,832 8.450% 120
12 Saltillo MS 38866 $1,515,000 $1,505,962 $12,148 8.450% 120
13 Columbus IN 47201 $1,500,000 $1,491,051 $12,028 8.450% 120
14 North Tonawanda NY 14120 $1,500,000 $1,491,051 $12,028 8.450% 120
15 St. Cloud MN 56303 $1,500,000 $1,491,051 $12,028 8.450% 120
16 Jackson MS 39208 $1,387,500 $1,379,222 $11,126 8.450% 120
17 Collierville TN 38017 $1,125,000 $1,118,288 $9,021 8.450% 120
18 Bloomington IL 61702 $787,500 $782,802 $6,315 8.450% 120
19 Danville IL 61832 $637,500 $633,697 $5,112 8.450% 120
20 Washington DC 20037 $34,000,000 $33,946,529 $248,499 7.375% 300
21 Winston-Salem NC 27105 $7,180,000 $7,167,328 $48,980 7.250% 120
22 Kernersville NC 27284 $6,880,000 $6,867,858 $46,934 7.250% 120
23 Winston-Salem NC 27107 $5,880,000 $5,869,623 $40,112 7.250% 120
24 Kernersville NC 37284 $5,860,000 $5,849,658 $39,976 7.250% 120
25 Winston-Salem NC 27105 $2,200,000 $2,196,117 $15,008 7.250% 120
26 Springfield IL 62704 $18,250,000 $18,218,954 $127,357 7.480% 144
27 Roseville MN 55113 $18,000,000 $17,978,284 $119,996 7.020% 120
28 Woodbridge VA 22191 $17,400,000 $17,339,084 $122,260 7.550% 120
29 Minneapolis MN 55416 $16,100,000 $16,051,053 $120,163 8.180% 120
30 Gainesville FL 32608 $7,500,000 $7,479,928 $52,913 6.980% 120
31 Gainesville FL 32608 $7,300,000 $7,280,463 $51,502 6.980% 120
32 Richfield MN 55423 $13,300,000 $13,263,359 $96,850 7.920% 240
33 Richfield MN 55423 $1,500,000 $1,477,531 $15,362 7.840% 156
34 Kirkland WA 98033 $3,450,000 $3,440,377 $24,955 7.850% 240
35 San Francisco CA 94110 $3,410,000 $3,400,488 $24,666 7.850% 240
36 Las Vegas NV 89102 $2,750,000 $2,742,329 $19,892 7.850% 240
37 Las Vegas NV 89030 $2,750,000 $2,742,329 $19,892 7.850% 240
38 Paradise CA 95969 $1,830,000 $1,824,895 $13,237 7.850% 240
39 Oregon City OR 97045 $13,200,000 $13,184,033 $87,731 6.990% 120
40 Chicago IL 60610 $13,000,000 $12,973,451 $94,937 7.950% 120
41 Greenville DE 19807 $7,600,000 $7,586,457 $51,536 7.190% 120
42 Greenville DE 19807 $5,200,000 $5,190,734 $35,262 7.190% 120
43 Decatur GA 30035 $11,400,000 $11,341,188 $89,503 8.200% 240
44 Rancho Santa Margarita CA 92688 $11,300,000 $11,274,478 $78,625 7.450% 120
45 Chamblee GA 30341 $3,350,000 $3,334,572 $29,818 8.850% 240
46 Yorktown NY 10598 $2,100,000 $2,090,328 $18,692 8.850% 240
47 Scarsdale NY 10583 $1,650,000 $1,642,401 $14,687 8.850% 240
48 Yorktown NY 10598 $1,650,000 $1,642,401 $14,687 8.850% 240
49 Yorktown NY 10598 $970,000 $965,533 $8,634 8.850% 240
50 Scarsdale NY 10583 $650,000 $647,006 $5,786 8.850% 240
51 New York NY 10003 $10,000,000 $9,988,136 $72,281 7.250% 120
52 Bronx NY 10458 $10,000,000 $9,977,096 $69,102 7.380% 120
53 Houston TX 77027 $10,000,000 $9,975,993 $75,730 7.780% 300
54 Sunset Hills MO 63127 $9,750,000 $9,705,557 $79,366 8.630% 300
55 Lancaster CA 93536 $9,360,000 $9,339,649 $66,346 7.640% 120
56 Southfield MI 48075 $9,000,000 $8,987,509 $65,100 7.850% 120
57 Bronx NY 10458 $8,750,000 $8,739,535 $58,921 7.120% 120
58 St. Louis MO 63011 $8,400,000 $8,382,670 $61,052 7.900% 144
59 Schaumburg IL 60194 $8,000,000 $7,987,281 $54,141 7.170% 120
60 Lewisville TX 75067 $7,920,000 $7,896,817 $55,976 7.610% 120
61 Champaign IL 61820 $7,900,000 $7,883,369 $56,870 7.800% 120
62 Palm Beach Gardens FL 33480 $7,850,000 $7,823,899 $56,417 7.783% 120
63 Lansing MI 48910 $7,600,000 $7,586,522 $51,691 7.220% 120
64 North Miami FL 33181 $7,500,000 $7,491,030 $50,504 7.120% 120
65 Auburn MA 01501 $7,500,000 $7,482,356 $57,539 7.930% 180
66 Baltimore MD 21227 $7,500,000 $7,476,221 $57,886 8.000% 300
67 Columbia SC 29204 $7,250,000 $7,224,844 $53,294 7.440% 120
68 Sandy Springs GA 30328 $7,100,000 $7,079,914 $51,013 7.780% 120
69 Santa Monica CA 90404 $7,000,000 $6,984,577 $49,340 7.260% 324
70 Philadelphia PA 19149 $6,900,000 $6,877,403 $52,344 7.800% 180
71 Marietta GA 30062 $6,480,000 $6,468,853 $44,910 7.410% 120
72 Cleveland OH 44115 $6,000,000 $5,990,825 $45,202 7.720% 300
73 Melbourne FL 32901 $5,900,000 $5,882,185 $44,159 8.210% 120
74 San Jose CA 95123 $5,650,000 $5,638,966 $42,129 8.170% 120
75 El Cajon CA 92020 $5,570,000 $5,557,546 $38,984 7.510% 84
76 Fremont CA 94555 $5,200,000 $5,191,154 $36,288 7.480% 120
77 Atlanta GA 30317 $5,170,000 $5,157,582 $42,270 9.180% 115
78 Bloomington MN 55437 $5,110,000 $5,089,022 $36,503 7.720% 120
79 Hyde Park NY 12538 $5,100,000 $5,087,488 $38,088 7.620% 180
80 Chicago IL 60622 $5,025,000 $5,009,336 $37,117 8.070% 120
<CAPTION>
Remaining Original Remaining Anticipated
Term to Stated Maturity Amortization Amortization ARD Repayment
# Term Date Term (months) Term (months) Originator Loans Date
- ---- ---- ------------- ------------- ---------- ----- ----
<S> <C> <C> <C> <C> <C> <C> <C>
1 359 2/1/28 360 359 Column Yes 2/1/08
2 114 8/31/07 300 294 Column No N/A
3 114 8/31/07 300 294 Column No N/A
4 114 8/31/07 300 294 Column No N/A
5 114 8/31/07 300 294 Column No N/A
6 114 8/31/07 300 294 Column No N/A
7 114 8/31/07 300 294 Column No N/A
8 114 8/31/07 300 294 Column No N/A
9 114 8/31/07 300 294 Column No N/A
10 114 8/31/07 300 294 Column No N/A
11 114 8/31/07 300 294 Column No N/A
12 114 8/31/07 300 294 Column No N/A
13 114 8/31/07 300 294 Column No N/A
14 114 8/31/07 300 294 Column No N/A
15 114 8/31/07 300 294 Column No N/A
16 114 8/31/07 300 294 Column No N/A
17 114 8/31/07 300 294 Column No N/A
18 114 8/31/07 300 294 Column No N/A
19 114 8/31/07 300 294 Column No N/A
20 299 2/1/23 300 299 Column Yes 2/1/08
21 118 1/1/08 360 358 Union Capital No N/A
22 118 1/1/08 360 358 Union Capital No N/A
23 118 1/1/08 360 358 Union Capital No N/A
24 118 1/1/08 360 358 Union Capital No N/A
25 118 1/1/08 360 358 Union Capital No N/A
26 142 1/1/10 360 358 Column No N/A
27 119 2/1/08 360 359 Column No N/A
28 115 10/1/07 360 355 Column No N/A
29 115 10/1/07 360 355 Column No N/A
30 118 1/1/08 300 298 Column No N/A
31 118 1/1/08 300 298 Column No N/A
32 236 11/1/17 360 356 Column No N/A
33 152 11/1/10 156 152 Column No N/A
34 236 11/1/17 360 356 Column No N/A
35 236 11/1/17 360 356 Column No N/A
36 236 11/1/17 360 356 Column No N/A
37 236 11/1/17 360 356 Column No N/A
38 236 11/1/17 360 356 Column No N/A
39 119 2/1/08 360 359 Union Capital No N/A
40 117 12/1/07 360 357 Column No N/A
41 118 1/1/08 360 358 Column No N/A
42 118 1/1/08 360 358 Column No N/A
43 235 10/1/17 300 295 Column No N/A
44 117 12/1/07 360 357 Column No N/A
45 237 12/1/17 240 237 Column Yes 12/1/07
46 237 12/1/17 240 237 Column Yes 12/1/07
47 237 12/1/17 240 237 Column Yes 12/1/07
48 237 12/1/17 240 237 Column Yes 12/1/07
49 237 12/1/17 240 237 Column Yes 12/1/07
50 237 12/1/17 240 237 Column Yes 12/1/07
51 119 2/1/08 300 299 Column No N/A
52 117 12/1/07 360 357 Column No N/A
53 298 1/1/23 300 298 Column Yes 1/1/08
54 295 10/1/22 300 295 Column Yes 10/1/07
55 117 12/1/07 360 357 Column No N/A
56 118 1/1/08 360 358 Column No N/A
57 119 2/1/08 360 359 Column No N/A
58 141 12/1/09 360 357 Column No N/A
59 118 1/1/08 360 358 Column No N/A
60 116 11/1/07 360 356 Column No N/A
61 117 12/1/07 360 357 Column No N/A
62 115 10/1/07 360 355 Column No N/A
63 118 1/1/08 360 358 Column No N/A
64 119 2/1/08 360 359 Column No N/A
65 178 1/1/13 300 298 Column No N/A
66 297 12/1/22 300 297 Column Yes 12/1/07
67 117 12/1/07 300 297 Column No N/A
68 116 11/1/07 360 356 Column No N/A
69 322 12/1/24 324 322 Column Yes 12/1/07
70 177 12/1/12 300 297 Column No N/A
71 118 1/1/08 360 358 Column No N/A
72 299 2/1/23 300 299 Column Yes 2/1/08
73 115 10/1/07 360 355 Column No N/A
74 117 12/1/07 360 357 Column No N/A
75 81 12/1/04 360 357 ARCS No N/A
76 118 1/1/08 360 358 Column No N/A
77 110 5/1/07 360 355 Column No N/A
78 114 9/1/07 360 354 Column No N/A
79 178 1/1/13 300 298 Column No N/A
80 115 10/1/07 360 355 Column No N/A
</TABLE>
<PAGE>
Schedule B-1
Mortgage Loan Schedule
<TABLE>
<CAPTION>
# Property Name Address
- ------------- -------
<S> <C> <C>
81 Wellington Place North 30445 Northwestern Hwy.
82 Woodstock Square Shopping Center Highway 92 / Alabama Road
83 Willow Creek Apartments 13656 Hilleary Place
84 Rainforest Cafe Property 605 N. Clark Street
85 Randall's Store 5800 New Territory Blvd.
86 34-38 Industrial Way East (Eatontown) 34-38 Industrial Way East
87 Red Cedar Building 44425 Pecan Court
88 Vineyard Crossing Apartments 3411 Old Vineyard Road
89 Ojai Oaks Mobile Home Park 950 Woodland Avenue
90 Highlands Ranch Town Center SWC of S. Broadway & Highlands Ranch Parkway
91 Greyberry Apartments of Wayne 3609 Hannan Road
92 Sunset Pecos Plaza 3460 Sunset Road and 6420 South Pecos Road
93 Carls Furniture/Sound Advice 17651 N. Biscayne Blvd.
94 Eldorado Estates Mobile Home Park 1 Eldorado Court
95 North Plank Road ShopRite Center NW Corner of Route 32 and Chestnut Lane
96 Colony Plaza Shopping Center State Highway 121 at Main Street
97 10 North Ridgewood Road 10 North Ridgewood Road
98 Doral Centre Shopping Plaza 9555 NW 41st Street
99 Carmel Woods Apartments 3500 San Clemente Avenue
100 Seven Corners Professional Buildings 6305 & 6319 Castle Place & 2946 Sleepy Hollow Rd.
101 Sunnydale MHP 301 Sunnydale Drive
102 Provence North Apartments 6558 Roswell Road
103 Courtyard Garden Apartments 4040 Badillo Circle
104 Walgreens - Seattle 14330-14350 Lake City Way Northeast
105 Apache Village Apartments 3839 Hart Boulevard
106 Walgreens Retail Building - Gresham 1950 N.E. Burnside Road
107 Westridge Plaza 25001-25099 Center Ridge Road
108 University Village Apartments 659 Elm Street
109 The Plaza at Stonebridge NEC of El Dorado Parkway and Lake Forest Drive
110 Henderson Plaza 2307 U.S Highway 79
111 East Town Plaza 1126 Elida Avenue
112 Lake Chabot Medical Center 20055 Lake Chabot Road
113 Garden City Town Center 5836-5940 Middlebelt Road
114 Las Brisas Apartments 2200 Las Brisas Way
115 Bear Ground Apartments I, II, III South 2nd and 5th Street
116 Walgreens Retail Building - Tucson 1550 West Valencia Road
117 Mark Apartments 3315 North Hills Street
118 Bank Properties 1120 Nye Street
119 4646 Bronze Way (1H) 4646 Bronze Way
120 4647 Bronze Way (1H) 4647 Bronze Way
121 Aspenwood Apartments 3235 S. Mendenhall Road
122 Lauderdale Parc Apartments 3333 Davie Boulevard
123 West County Plaza 1613 Northwest County Road
124 Sheldon Plaza Retail Center 1502-1590 Coburg Road
125 Olde Falls Village 245 East Street
126 The Highland Office Building 885 Arapahoe Avenue
127 A-1 Storage of Lafayette 530 Stacy Court
128 The Gaither Center 9083 Gaither Rd. & 15900-15944 Luanne Drive
129 Willowbrook North Townhome Apartment Complex 2018 W. Rundberg
130 Casual Male Corporate Office Building 437 Turnpike Street
131 Walgreens Retail Building - Portland 3 N.E. 82ND Avenue
132 Lake Placid Village Apartments 5801 Kingsport Drive
133 Cumberland Apartments 4600 N. Cumberland Avenue
134 Rainbow Shopping Center NEC of Rainbow Blvd & Spring Mountain Rd
135 Snowfall Plaza Route 7A
136 Finley Terrace Apartments 2504 Finley Road
137 417 W. Barry Avenue/3030 N. Sheridan Road 417 W. Barry Avenue/3030 N. Sheridan Road
138 Bradford Gwinnett Apartments 100 Castor Drive
139 Furr's Grocery Store 5514 Alameda Avenue
140 South Brunswick Industrial Park 110 Melrich Road
141 Villager Square Shopping Center 9012-9142 West Ken Caryl Ave.
142 Flint Hill Building 11601-11631 Nebel Street
143 Peppertree Apartments 4203 Buford Highway
144 Star Ranch Plaza 3647 Star Ranch Road
145 Morehead Hills Apartments 500 Cobb Street
146 Forest Park Apartments 33 Cunningham Road
147 Freeway Plaza Building West 1500 Fourth Avenue
148 Coconut Creek Apartments 370 Sunshine Drive
149 The Colonial Arms Apartments 5901, 5817, 5701 Edmond
150 Norwood Park North Office Building 1550 Norwood Drive
151 Chevy Chase Arcade 5520 Connecticut Avenue, N.W.
152 Holcombe Medical Building 2201 W. Holcombe
153 Youngstown Mobile Home Park 911 N. McDowell Boulevard
154 Kinston Marketplace 1030 New Bern Road
155 Versailles Apartments 1110 West Poplar Street
156 Chaparral Apartments 603 W. Eagle
157 Revco Drug Store Keith Street at Tucker Street
158 Oakwood Estates Apartments 1457 Oakwood Drive
159 Innsbruck Villa Apartments 2395 Third Street Northwest
160 The Pathmark Grocery Store 407-411 Valley Street
<CAPTION>
Original Original
Principal Cut-off Date Monthly Mortgage Term to Stated
# City State Zip Code Balance Balance Payment Rate Term
- ---- ----- -------- ------- ------- ------- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
81 Farmington Hills MI 48334 $5,000,000 $4,993,061 $36,167 7.850% 120
82 Woodstock GA 30188 $5,000,000 $4,991,453 $34,790 7.450% 120
83 Poway CA 92064 $4,985,000 $4,973,854 $34,890 7.510% 84
84 Chicago IL 60610 $5,000,000 $4,959,525 $44,813 8.350% 180
85 Sugar Land TX 77479 $4,800,000 $4,790,197 $35,054 7.950% 240
86 Eatontown NJ 07724 $4,600,000 $4,590,019 $32,638 7.650% 120
87 California MD 20619 $4,400,000 $4,387,331 $31,370 7.700% 120
88 Winston-Salem NC 27103 $4,300,000 $4,294,977 $29,772 7.400% 84
89 Ojai CA 93105 $4,300,000 $4,284,628 $30,806 7.750% 120
90 Highlands Ranch CO 80126 $4,250,000 $4,235,811 $32,983 8.320% 120
91 Wayne MI 48184 $4,200,000 $4,187,000 $28,880 7.330% 120
92 Las Vegas NV 89120 $4,100,000 $4,086,934 $31,004 8.320% 120
93 Aventura FL 33160 $4,050,000 $4,028,322 $32,999 7.650% 180
94 St. Peters MO 63376 $3,835,000 $3,823,417 $26,710 7.460% 240
95 Newburgh NY 12550 $3,800,000 $3,793,970 $27,671 7.920% 120
96 The Colony TX 75056 $3,800,000 $3,789,211 $27,276 7.770% 120
97 South Orange NJ 07079 $3,800,000 $3,787,272 $27,224 7.750% 120
98 Miami FL 33178 $3,800,000 $3,784,662 $28,069 8.070% 120
99 Modesto CA 95356 $3,790,000 $3,781,526 $26,526 7.510% 84
100 Falls Church VA 22042 $3,750,000 $3,739,241 $26,762 7.710% 120
101 St. Charles MO 63301 $3,740,000 $3,728,703 $26,048 7.460% 240
102 Atlanta GA 30328 $3,650,000 $3,634,487 $25,671 7.560% 120
103 Baldwin Park CA 91706 $3,500,000 $3,492,436 $24,881 7.670% 120
104 Seattle WA 98125 $3,280,000 $3,270,851 $23,725 7.850% 240
105 Columbia Heights MN 55241 $3,235,000 $3,223,550 $22,620 7.500% 120
106 Gresham OR 97030 $3,200,000 $3,191,074 $23,147 7.850% 240
107 Westlake OH 44145 $3,200,000 $3,189,605 $24,381 7.850% 120
108 Terre Haute IN 47807 $3,150,000 $3,144,624 $21,939 7.460% 120
109 McKinney TX 75070 $3,150,000 $3,139,728 $22,829 7.870% 240
110 Henderson TX 75654 $3,125,000 $3,115,214 $23,039 8.050% 120
111 Delphos OH 45833 $3,080,000 $3,068,204 $23,312 8.330% 120
112 Castro Valley CA 94546 $3,000,000 $2,995,195 $21,721 7.860% 120
113 Garden City MI 48135 $3,000,000 $2,983,679 $22,897 7.870% 120
114 Sierra Vista AZ 85635 $2,950,000 $2,939,927 $21,877 7.540% 120
115 Waco TX 76706 $2,900,000 $2,890,437 $20,916 7.820% 120
116 Tucson AZ 85746 $2,900,000 $2,889,908 $22,976 7.550% 240
117 Meridian MS 39305 $2,850,000 $2,843,433 $19,636 7.350% 120
118 San Rafael CA 94901 $2,800,000 $2,792,828 $21,095 8.280% 120
119 Dallas TX 75236 $1,610,000 $1,603,376 $12,630 8.190% 120
120 Dallas TX 75236 $1,090,000 $1,085,515 $8,550 8.190% 120
121 Memphis TN 38115 $2,600,000 $2,592,037 $17,984 7.390% 120
122 Fort Lauderdale FL 33312 $2,550,000 $2,531,065 $19,800 8.070% 120
123 Odessa TX 79763 $2,525,000 $2,518,042 $18,369 7.910% 120
124 Eugene OR 97401 $2,500,000 $2,493,800 $18,540 7.540% 120
125 Village of Honeoye Falls NY 14472 $2,500,000 $2,490,876 $17,877 7.130% 120
126 Boulder CO 80302 $2,500,000 $2,483,249 $21,208 8.190% 240
127 Lafayette CO 80026 $2,465,000 $2,454,422 $18,911 7.930% 120
128 Gaithersburg MD 20877 $2,350,000 $2,342,218 $17,735 7.740% 120
129 Austin TX 78758 $2,320,000 $2,314,750 $16,127 7.440% 120
130 Canton MA 02021 $2,300,000 $2,292,234 $17,162 7.610% 84
131 Portland OR 97220 $2,290,000 $2,283,612 $16,564 7.850% 240
132 Atlanta GA 30342 $2,100,000 $2,096,318 $14,383 7.290% 120
133 Chicago IL 60656 $2,100,000 $2,095,286 $14,669 7.490% 120
134 Las Vegas NV 89102 $2,075,000 $2,071,134 $15,808 8.400% 120
135 Manchester VT 05255 $2,050,000 $2,042,910 $16,245 8.830% 120
136 Irving TX 75062 $2,050,000 $2,042,133 $15,763 8.500% 84
137 Chicago IL 60657 $2,000,000 $1,995,501 $13,943 7.470% 120
138 Norcross GA 30071 $2,000,000 $1,992,538 $16,407 7.740% 120
139 El Paso TX 79905 $2,000,000 $1,992,432 $16,247 7.610% 240
140 South Brunswick NJ 08846 $2,000,000 $1,986,343 $16,766 8.030% 120
141 Littleton CO 80127 $1,960,000 $1,955,119 $14,497 7.510% 120
142 Rockville MD 20852 $1,950,000 $1,943,583 $14,755 7.770% 180
143 Atlanta GA 30345 $1,900,000 $1,896,571 $12,781 7.110% 120
144 Colorado Springs CO 80906 $1,900,000 $1,892,296 $15,019 8.280% 120
145 Durham NC 27701 $1,890,000 $1,887,770 $12,932 7.280% 84
146 Taylors SC 29687 $1,780,000 $1,777,900 $12,179 7.280% 84
147 Spokane WA 99204 $1,774,628 $1,773,435 $13,172 8.100% 117
148 Coconut Creek FL 33066 $1,760,000 $1,754,320 $13,468 7.900% 120
149 Waco TX 76710 $1,700,000 $1,696,083 $11,713 7.350% 120
150 Hurst TX 76054 $1,525,000 $1,520,873 $11,190 8.000% 120
151 Washington DC 20015 $1,500,000 $1,496,899 $10,892 7.890% 120
152 Houston TX 77030 $1,500,000 $1,496,758 $10,663 7.670% 120
153 Petaluma CA 94952 $1,500,000 $1,496,585 $10,406 7.420% 120
154 Kinston NC 28501 $1,500,000 $1,495,688 $10,694 7.700% 120
155 Griffin GA 30344 $1,510,000 $1,494,732 $12,640 8.010% 240
156 Denton TX 76201 $1,500,000 $1,482,588 $14,387 8.060% 180
157 Cleveland TN 37311 $1,465,000 $1,459,757 $11,892 7.600% 240
158 Greenville MS 38701 $1,440,000 $1,436,008 $10,446 7.880% 120
159 New Brighton MN 55112 $1,375,000 $1,370,133 $9,614 7.500% 120
160 S. Orange Village Township NJ 07079 $1,350,000 $1,330,993 $13,254 8.450% 180
<CAPTION>
Remaining Original Remaining Anticipated
Term to Stated Maturity Amortization Amortization ARD Repayment
# Term Date Term (months) Term (months) Originator Loans Date
- ---- ---- ------------- ------------- ---------- ----- ----
<S> <C> <C> <C> <C> <C> <C> <C>
81 118 1/1/08 360 358 Column No N/A
82 118 1/1/08 360 358 Union Capital No N/A
83 81 12/1/04 360 357 ARCS No N/A
84 176 11/1/12 216 212 Column No N/A
85 237 12/1/17 360 357 Column No N/A
86 117 12/1/07 360 357 Column No N/A
87 116 11/1/07 360 356 Column No N/A
88 83 2/1/05 360 359 Column No N/A
89 115 10/1/07 360 355 Column No N/A
90 116 11/1/07 324 320 Column No N/A
91 116 11/1/07 360 356 Column No N/A
92 115 10/1/07 360 355 Column No N/A
93 177 12/1/12 240 237 Column No N/A
94 236 11/1/17 360 356 Union Capital No N/A
95 118 1/1/08 360 358 Column No N/A
96 116 11/1/07 360 356 Column No N/A
97 115 10/1/07 360 355 Column No N/A
98 114 9/1/07 360 354 Column No N/A
99 81 12/1/04 360 357 ARCS No N/A
100 116 11/1/07 360 356 Column No N/A
101 236 11/1/17 360 356 Union Capital No N/A
102 114 9/1/07 360 354 Union Capital No N/A
103 117 12/1/07 360 357 Column No N/A
104 236 11/1/17 360 356 Column No N/A
105 115 10/1/07 360 355 Column No N/A
106 236 11/1/17 360 356 Column No N/A
107 117 12/1/07 300 297 Column No N/A
108 118 1/1/08 360 358 ARCS No N/A
109 235 10/1/17 360 355 Column No N/A
110 115 10/1/07 360 355 Column No N/A
111 114 9/1/07 360 354 Column No N/A
112 118 1/1/08 360 358 Column No N/A
113 115 10/1/07 300 295 Column No N/A
114 117 12/1/07 300 297 Column No N/A
115 115 10/1/07 360 355 Column No N/A
116 238 1/1/18 252 250 Column No N/A
117 117 12/1/07 360 357 Column No N/A
118 116 11/1/07 360 356 Column No N/A
119 116 11/1/07 300 296 Column No N/A
120 116 11/1/07 300 296 Column No N/A
121 116 11/1/07 360 356 Column No N/A
122 113 8/1/07 300 293 Column No N/A
123 116 11/1/07 360 356 Column No N/A
124 118 1/1/08 300 298 Column No N/A
125 117 12/1/07 300 297 Column No N/A
126 236 11/1/17 240 236 Column No N/A
127 116 11/1/07 300 296 Column No N/A
128 117 12/1/07 300 297 Column No N/A
129 117 12/1/07 360 357 Column No N/A
130 81 12/1/04 300 297 Union Capital No N/A
131 236 11/1/17 360 356 Column No N/A
132 118 1/1/08 360 358 Column No N/A
133 117 12/1/07 360 357 Column No N/A
134 117 12/1/07 360 357 Column No N/A
135 114 9/1/07 360 354 GMAC No N/A
136 77 8/1/04 360 353 Column No N/A
137 117 12/1/07 360 357 Column No N/A
138 118 1/1/08 240 238 Column No N/A
139 238 1/1/18 240 238 Column No N/A
140 116 11/1/07 240 236 Column No N/A
141 118 1/1/08 300 298 Column No N/A
142 177 12/1/12 300 297 Column No N/A
143 118 1/1/08 360 358 Union Capital No N/A
144 116 11/1/07 300 296 Column No N/A
145 83 2/1/05 360 359 Column No N/A
146 83 2/1/05 360 359 Column No N/A
147 116 11/1/07 357 356 Union Capital No N/A
148 117 12/1/07 300 297 Column No N/A
149 117 12/1/07 360 357 Column No N/A
150 116 11/1/07 360 356 Column No N/A
151 117 12/1/07 360 357 Column No N/A
152 117 12/1/07 360 357 Column No N/A
153 117 12/1/07 360 357 Column No N/A
154 116 11/1/07 360 356 Column No N/A
155 234 9/1/17 240 234 Column No N/A
156 176 11/1/12 180 176 Column No N/A
157 238 1/1/18 240 238 Column No N/A
158 116 11/1/07 360 356 Union Capital No N/A
159 115 10/1/07 360 355 Column No N/A
160 175 10/1/12 180 175 Column No N/A
</TABLE>
<PAGE>
Schedule B-1
Mortgage Loan Schedule
<TABLE>
<CAPTION>
# Property Name Address
- ------------- -------
<S> <C> <C>
161 La Carre Apartments 700 N. Indian Creek Drive
162 Westside Plaza Shopping Center 400-440 S. Ventura Road
163 Woodhollow Apartments 2451 Lake Road
164 Park View Place Apartments 6226 Barnes Road South
165 2500 Packard Road 2500 Packard Road
166 K-Mart Plaza 4545 South Noland Road
167 Portland Contessa Apartments 410 Lang Road
168 Lovers Lane Animal Hospital/Clinic 4660 West Lovers Lane
<CAPTION>
Original Original
Principal Cut-off Date Monthly Mortgage Term to Stated
# City State Zip Code Balance Balance Payment Rate Term
- ---- ----- -------- ------- ------- ------- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
161 Clarkston GA 30021 $1,300,000 $1,297,728 $8,921 7.310% 120
162 Oxnard CA 93030 $1,300,000 $1,292,143 $10,354 8.370% 120
163 Huntsville TX 77340 $1,200,000 $1,196,524 $9,134 8.390% 120
164 Jacksonville FL 32216 $1,087,000 $1,083,214 $7,885 7.880% 120
165 Ann Arbor MI 48104 $1,050,000 $1,044,303 $8,633 8.750% 180
166 Independence MO 64051 $700,000 $698,338 $5,338 7.860% 120
167 Portland TX 78374 $640,000 $639,252 $4,431 7.400% 84
168 Dallas TX 75207 $512,000 $507,458 $4,689 9.250% 120
--------------------------------
Total Weighted Average: $841,054,878 $838,800,140
================================
<CAPTION>
Remaining Original Remaining Anticipated
Term to Stated Maturity Amortization Amortization ARD Repayment
# Term Date Term (months) Term (months) Originator Loans Date
- ---- ---- ------------- ------------- ---------- ----- ----
<S> <C> <C> <C> <C> <C> <C> <C>
161 118 1/1/08 360 358 Union Capital No N/A
162 114 9/1/07 300 294 Column No N/A
163 115 10/1/07 360 355 Column No N/A
164 115 10/1/07 360 355 Union Capital No N/A
165 174 9/1/12 300 294 Column No N/A
166 118 1/1/08 300 298 Column No N/A
167 83 2/1/05 360 359 Column No N/A
168 114 9/1/07 240 234 Column No N/A
</TABLE>
(1A) The Mortgage Loans secured by the 18 Stone Container industrial properties,
respectively, are cross-collateralized and cross-defaulted.
(1B) The Mortgage Loans secured by Willow Creek Apartments (Foster Portfolio),
Lake Park Apartments, Plaza South Apartments, Farmwood Apartments, and
Colony Apartments, respectively, are cross-collateralized and
cross-defaulted.
(1C) The Mortgage Loans secured by Pebble Creek Apartments and Homestead
Apartments, respectively, are cross-collateralized and cross-defaulted.
(1D) The Mortgage Loans secured by Shops at Lyndale Phase II and Shops at
Lyndale Phase II - TIF, respectively, are cross-collateralized and
cross-defaulted.
(1E) The Mortgage Loans secured by Walgreens - Kirkland, Walgreens Retail
Pharmacy Store - San Francisco, Walgreens Retail Pharmacy Store -
Charleston/Torrey, Walgreens Retail Pharmacy Store - Las Vegas Boulevard,
and Walgreens/Pharmacy Store - Paradise, respectively, are
cross-collateralized and cross-defaulted.
(1F) The Mortgage Loans secured by Two Greenville Crossing and One Greenville
Crossing, respectively, are cross-collateralized and cross-defaulted.
(1G) The Mortgage Loans secured by Curry Honda Automobile Dealership, Curry
Chevrolet Automobile Dealership, Curry Acura Automobile Dealership, Curry
Ford/Subaru Automobile Dealership, Curry Mitsubishi Automobile Dealership,
and Curry Office Building, respectively, are cross-collateralized and
cross-defaulted.
(1H) The Mortgage Loans secured by 4646 Bronze Way and 4647 Bronze Way,
respectively, are cross-collateralized and cross-defaulted.
<PAGE>
EXHIBIT B-2
SCHEDULE OF EXCEPTIONS TO
MORTGAGE FILE DELIVERY
B-2-1
<PAGE>
EXHIBIT B-2
SCHEDULE OF EXCEPTIONS TO MORTGAGE LOAN DELIVERY
DLJ COMMERCIAL MORTGAGE CORP.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1998-CPI
<TABLE>
<CAPTION>
LEGEND TC - Title Commitment
M - Missing TP - Title Policy GENERAL COMMENTS. ENDORSEMENT AND ASSIGNMENT DOCUMENTS
O - Original COT - Certificate of Insurance ARE IN BLANK S/B NORWEST BANK MINNESOTA, NATIONAL
C - Copy TB - Title Binder ASSOCIATION, AS TRUSTEE, ETC.
CTC - Certified True Copy
CCTC - County Certified True Copy
R - Recorded
UR - Unrecorded
N/A - Not Applicable
Original
Principal ENDORS. INTRVN
Loan # Property Name Balance NOTE (to Norwest) MORTGAGE ASSIGN
- - -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1 Showboat Hotel & Casino, Atlantic City $100,000,000
2 Stone Container - Santa Fe Springs (1A) $4,500,000
3 Stone Container - Mansfield (1A) $4,350,000
4 Stone Container - San Jose (1A) $4,237,500
5 Stone Container - Minneapolis (1A) $3,862,500
6 Stone Container - Springfield (1A) $3,525,000
7 Stone Container - Salinas (1A) $3,018,750
8 Stone Container - Harahan (1A) $2,850,000
9 Stone Container - Rogers (1A) $2,362,500
10 Stone Container - Keokuk (1A) $1,762,500
11 Stone Container - Portland (1A) $1,725,000
12 Stone Container - Saltillo (1A) $1,515,000
13 Stone Container - Columbus (1A) $1,500,000
14 Stone Container - North Tonawanda (1A) $1,500,000
15 Stone Container - St. Cloud (1A) $1,500,000
16 Stone Container - Jackson (1A) $1,387,500
17 Stone Container - Collierville (1A) $1,125,000
18 Stone Container - Bloomington (1A) $787,500
19 Stone Container - Danville (1A) $637,500
20 Washington Marriott Hotel $34,000,000 M
21 Willow Creek Apartments (Foster Portfolio) (1B) $7,180,000
22 Lake Park Apartments (1B) $6,880,000
23 Plaza South Apartments (1B) $5,880,000 M
24 Farmwood Apartments (1B) $5,860,000
25 Colony Apartments (1B) $2,200,000
26 Southwest Plaza I and II Shopping Center $18,250,000
27 The Rosedale Corporate Plaza $18,000,000
28 Bayvue Apartments $17,400,000
29 Lake Calhoun Executive Center $16,100,000
30 Pebble Creek Apartments (1C) $7,500,000
31 Homestead Apartments (1C) $7,300,000
32 Shops at Lyndale Phase II (1D) $13,300,000
33 Shops at Lyndale Phase II - TIF (1D) $1,500,000
34 Walgreens - Kirkland (1E) $3,450,000
35 Walgreens Retail Pharmacy Store - San Francisco (1E) $3,410,000
36 Walgreens Retail Pharmacy Store - Charleston/Torrey (1E) $2,750,000
37 Walgreens Retail Pharmacy Store - Las Vegas Boulevard (1E) $2,750,000
38 Walgreens Retail/Pharmacy Store - Paradise (1E) $1,830,000
39 Country Village MHP $13,200,000
40 414 N. Orleans St. $13,000,000
41 Two Greenville Crossing (1F) $7,600,000
42 One Greenville Crossing (1F) $5,200,000
43 Wesley Chapel Square $11,400,000
44 Mercado del Lago Shopping Center $11,300,000
45 Curry Honda Automobile Dealership (1G) $3,350,000
46 Curry Chevrolet Automobile Dealership (1G) $2,100,000
</TABLE>
<PAGE>
EXHIBIT B-2
SCHEDULE OF EXCEPTIONS TO MORTGAGE LOAN DELIVERY
DLJ COMMERCIAL MORTGAGE CORP.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1998-CPI
<TABLE>
<CAPTION>
LEGEND TC - Title Commitment
M - Missing TP - Title Policy GENERAL COMMENTS. ENDORSEMENT AND ASSIGNMENT DOCUMENTS
O - Original COT - Certificate of Insurance ARE IN BLANK S/B NORWEST BANK MINNESOTA, NATIONAL
C - Copy TB - Title Binder ASSOCIATION, AS TRUSTEE, ETC.
CTC - Certified True Copy
CCTC - County Certified True Copy
R - Recorded
UR - Unrecorded
N/A - Not Applicable
Original
Principal ENDORS. INTRVN
Loan # Property Name Balance NOTE (to Norwest) MORTGAGE ASSIGN
- - -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
47 Curry Acura Automobile Dealership (1G) $1,650,000
48 Curry Ford/Subaru Automobile Dealership (1G) $1,650,000
49 Curry Mitsubishi Automobile Dealership (1G) $970,000
50 Curry Office Building (1G) $650,000
51 708 Broadway & 402-408 Lafayette St. $10,000,000
52 360-386 East Fordham Road $10,000,000
53 Hampton Inn - Houston Galleria $10,000,000 M
54 Holiday Inn Southwest and Viking Conference Center $9,750,000
55 Valley Central Center $9,360,000
56 Centrum Office Building $9,000,000
57 237-269 East Fordham Road $8,750,000
58 Dietrich Meadows S/C $8,400,000
59 Schaumburg Villas Apartments $8,000,000
60 Vista Ridge Retail Center $7,920,000
61 Trade Centre South $7,900,000
62 Loehman's Plaza $7,850,000
63 Southwind Plaza $7,600,000
64 127th Street Shopping Center $7,500,000
65 Filene's Basement Distribution Center $7,500,000
66 Holiday Inn Express Hotel $7,500,000 M
67 Forest Pines Retirement Residence $7,250,000
68 Hammond Springs Shopping Center $7,100,000
69 AMC Theater Complex $7,000,000
70 Roosevelt Plaza Shopping Center $6,900,000 M
71 Johnson Square Office Park $6,480,000
72 Comfort Inn - Cleveland $6,000,000
73 Gateway Business Center $5,900,000
74 Good Samaritan Medical Plaza $5,650,000
75 Spring Tree (CAP) LLC $5,570,000 M
76 Walgreen's Plaza $5,200,000
77 Candler McAfee Shopping Center $5,170,000
78 Heritage Hills Apartments $5,110,000
79 COLUMBIA HYDE GROUP, L.L..C. $5,100,000
80 1333 N. Kingsbury Street $5,025,000
81 Wellington Place North $5,000,000
82 Woodstock Square Shopping Center $5,000,000
83 Willow Creek Apartments $4,985,000 M
84 Rainforest Cafe Property $5,000,000
85 Randall's Store $4,800,000
86 34-38 Industrial Way East (Eatontown) $4,600,000
87 Red Cedar Building $4,400,000
88 Vineyard Crossing Apartments $4,300,000
89 Ojai Oaks Mobile Home Park $4,300,000
90 Highlands Ranch Town Center $4,250,000
91 Greyberry Apartments of Wayne $4,200,000
92 Sunset Pecos Plaza $4,100,000
</TABLE>
<PAGE>
EXHIBIT B-2
SCHEDULE OF EXCEPTIONS TO MORTGAGE LOAN DELIVERY
DLJ COMMERCIAL MORTGAGE CORP.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1998-CPI
<TABLE>
<CAPTION>
LEGEND TC - Title Commitment
M - Missing TP - Title Policy GENERAL COMMENTS. ENDORSEMENT AND ASSIGNMENT DOCUMENTS
O - Original COT - Certificate of Insurance ARE IN BLANK S/B NORWEST BANK MINNESOTA, NATIONAL
C - Copy TB - Title Binder ASSOCIATION, AS TRUSTEE, ETC.
CTC - Certified True Copy
CCTC - County Certified True Copy
R - Recorded
UR - Unrecorded
N/A - Not Applicable
Original
Principal ENDORS. INTRVN
Loan # Property Name Balance NOTE (to Norwest) MORTGAGE ASSIGN
- - -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
93 Carls Furniture/Sound Advice $4,050,000
94 Eldorado Estates Mobile Home Park $3,835,000
95 North Plank Road ShopRite Center $3,800,000
96 Colony Plaza Shopping Center $3,800,000
97 10 North Ridgewood Road $3,800,000
98 Doral Centre Shopping Plaza $3,800,000
99 Carmel Woods Apartments $3,790,000 M
100 Seven Corners Professional Buildings $3,750,000
101 Sunnydale MHP $3,740,000
102 Provence North Apartments $3,650,000
103 Courtyard Garden Apartments $3,500,000
104 Walgreens - Seattle $3,280,000
105 Apache Village Apartments $3,235,000
106 Walgreens Retail Building - Gresham $3,200,000
107 Westridge Plaza $3,200,000
108 University Village Apartments $3,150,000
109 The Plaza at Stonebridge $3,150,000
110 Henderson Plaza $3,125,000
111 East Town Plaza $3,080,000
112 Lake Chabot Medical Center $3,000,000
113 Garden City Town Center $3,000,000 C
114 Las Brisas Apartments $2,950,000
115 Bear Ground Apartments I, II, III $2,900,000
116 Walgreens Retail Building - Tucson $2,900,000
117 Mark Apartments $2,850,000 M
118 Bank Properties $2,800,000
119 4646 Bronze Way (1H) $1,610,000
120 4647 Bronze Way (1H) $1,090,000
121 Aspenwood Apartments $2,600,000
122 Lauderdale Parc Apartments $2,550,000
123 West County Plaza $2,525,000
124 Sheldon Plaza Retail Center $2,500,000
125 Olde Falls Village $2,500,000
126 The Highland Office Building $2,500,000
127 A-1 Storage of Lafayette $2,465,000
128 The Gaither Center $2,350,000
129 Willowbrook North Townhome Apartment Complex $2,320,000
130 Casual Male Corporate Office Building $2,300,000
131 Walgreens Retail Building - Portland $2,290,000
132 Lake Placid Village Apartments $2,100,000
133 Cumberland Apartments $2,100,000
134 Rainbow Shopping Center $2,075,000
135 Snowfall Plaza $2,050,000 M
136 Finley Terrace Apartments $2,050,000
137 417 W. Barry Avenue/3030 N. Sheridan Road $2,000,000
138 Bradford Gwinnett Apartments $2,000,000 M
</TABLE>
<PAGE>
EXHIBIT B-2
SCHEDULE OF EXCEPTIONS TO MORTGAGE LOAN DELIVERY
DLJ COMMERCIAL MORTGAGE CORP.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1998-CPI
<TABLE>
<CAPTION>
LEGEND TC - Title Commitment
M - Missing TP - Title Policy GENERAL COMMENTS. ENDORSEMENT AND ASSIGNMENT DOCUMENTS
O - Original COT - Certificate of Insurance ARE IN BLANK S/B NORWEST BANK MINNESOTA, NATIONAL
C - Copy TB - Title Binder ASSOCIATION, AS TRUSTEE, ETC.
CTC - Certified True Copy
CCTC - County Certified True Copy
R - Recorded
UR - Unrecorded
N/A - Not Applicable
Original
Principal ENDORS. INTRVN
Loan # Property Name Balance NOTE (to Norwest) MORTGAGE ASSIGN
- - -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
139 Furr's Grocery Store $2,000,000
140 South Brunswick Industrial Park $2,000,000
141 Villager Square Shopping Center $1,960,000
142 Flint Hill Building $1,950,000
143 Peppertree Apartments $1,900,000
144 Star Ranch Plaza $1,900,000
145 Morehead Hills Apartments $1,890,000
146 Forest Park Apartments $1,780,000
147 Freeway Plaza Building $1,931,000
148 Coconut Creek Apartments $1,760,000
149 The Colonial Arms Apartments $1,700,000
150 Norwood Park North Office Building $1,525,000
151 Chevy Chase Arcade $1,500,000
152 Holcombe Medical Building $1,500,000
153 Youngstown Mobile Home Park $1,500,000
154 Kinston Marketplace $1,500,000
155 Versailles Apartments $1,510,000
156 Chaparral Apartments $1,500,000
157 Revco Drug Store $1,465,000
158 Oakwood Estates Apartments $1,440,000
159 Innsbruck Villa Apartments $1,375,000
160 The Pathmark Grocery Store $1,350,000
161 La Carre Apartments $1,300,000
162 Westside Plaza Shopping Center $1,300,000
163 Woodhollow Apartments $1,200,000
164 Park View Place Apartments $1,087,000
165 2500 Packard Road $1,050,000
166 K-Mart Plaza $700,000
167 Portland Contessa Apartments $640,000
168 Lovers Lane Animal Hospital/Clinic $512,000
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
INTRVN ASSIGN OF
ASSIGN OF ASSIGN
ASSIGN. ASSIGN ASSIGN OF LEASE
Loan # Property Name (to Norwest) OF LEASES OF LEASE (to Norwest)
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1 Showboat Hotel & Casino, Atlantic City M
2 Stone Container - Santa Fe Springs (1A) M
3 Stone Container - Mansfield (1A) M
4 Stone Container - San Jose (1A) M
5 Stone Container - Minneapolis (1A) M
6 Stone Container - Springfield (1A) M
7 Stone Container - Salinas (1A) M
8 Stone Container - Harahan (1A) M
9 Stone Container - Rogers (1A) M
10 Stone Container - Keokuk (1A) M
11 Stone Container - Portland (1A) M
12 Stone Container - Saltillo (1A) M
13 Stone Container - Columbus (1A) M
14 Stone Container - North Tonawanda (1A) M
15 Stone Container - St. Cloud (1A) M
16 Stone Container - Jackson (1A) M
17 Stone Container - Collierville (1A) M
18 Stone Container - Bloomington (1A) M
19 Stone Container - Danville (1A) M
20 Washington Marriott Hotel C/UR C/UR
21 Willow Creek Apartments (Foster Portfolio) (1B)
22 Lake Park Apartments (1B)
23 Plaza South Apartments (1B) M
24 Farmwood Apartments (1B)
25 Colony Apartments (1B)
26 Southwest Plaza I and II Shopping Center
27 The Rosedale Corporate Plaza
28 Bayvue Apartments
29 Lake Calhoun Executive Center
30 Pebble Creek Apartments (1C)
31 Homestead Apartments (1C)
32 Shops at Lyndale Phase II (1D) M M
33 Shops at Lyndale Phase II - TIF (1D) M M
34 Walgreens - Kirkland (1E)
35 Walgreens Retail Pharmacy Store - San Francisco (1E)
36 Walgreens Retail Pharmacy Store - Charleston/Torrey (1E)
37 Walgreens Retail Pharmacy Store - Las Vegas Boulevard (1E)
38 Walgreens Retail/Pharmacy Store - Paradise (1E)
39 Country Village MHP
40 414 N. Orleans St. M
41 Two Greenville Crossing (1F)
42 One Greenville Crossing (1F)
43 Wesley Chapel Square
44 Mercado del Lago Shopping Center
45 Curry Honda Automobile Dealership (1G)
46 Curry Chevrolet Automobile Dealership (1G)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Original
Principal ENDORS. INTRVN
Loan # Property Name Balance NOTE (to Norwest) MORTGAGE ASSIGN
- - -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
47 Curry Acura Automobile Dealership (1G)
48 Curry Ford/Subaru Automobile Dealership (1G)
49 Curry Mitsubishi Automobile Dealership (1G)
50 Curry Office Building (1G)
51 708 Broadway & 402-408 Lafayette St.
52 360-386 East Fordham Road
53 Hampton Inn - Houston Galleria M M
54 Holiday Inn Southwest and Viking Conference Center
55 Valley Central Center
56 Centrum Office Building M M
57 237-269 East Fordham Road
58 Dietrich Meadows S/C
59 Schaumburg Villas Apartments
60 Vista Ridge Retail Center
61 Trade Centre South
62 Loehman's Plaza
63 Southwind Plaza
64 127th Street Shopping Center
65 Filene's Basement Distribution Center
66 Holiday Inn Express Hotel M M
67 Forest Pines Retirement Residence
68 Hammond Springs Shopping Center
69 AMC Theater Complex
70 Roosevelt Plaza Shopping Center
71 Johnson Square Office Park M M
72 Comfort Inn - Cleveland M M
73 Gateway Business Center
74 Good Samaritan Medical Plaza
75 Spring Tree (CAP) LLC
76 Walgreen's Plaza
77 Candler McAfee Shopping Center
78 Heritage Hills Apartments
79 COLUMBIA HYDE GROUP, L.L..C.
80 1333 N. Kingsbury Street M M
81 Wellington Place North
82 Woodstock Square Shopping Center
83 Willow Creek Apartments
84 Rainforest Cafe Property
85 Randall's Store
86 34-38 Industrial Way East (Eatontown) M M
87 Red Cedar Building
88 Vineyard Crossing Apartments
89 Ojai Oaks Mobile Home Park
90 Highlands Ranch Town Center
91 Greyberry Apartments of Wayne
92 Sunset Pecos Plaza
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Original
Principal ENDORS. INTRVN
Loan # Property Name Balance NOTE (to Norwest) MORTGAGE ASSIGN
- - -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
93 Carls Furniture/Sound Advice
94 Eldorado Estates Mobile Home Park
95 North Plank Road ShopRite Center
96 Colony Plaza Shopping Center
97 10 North Ridgewood Road
98 Doral Centre Shopping Plaza
99 Carmel Woods Apartments
100 Seven Corners Professional Buildings
101 Sunnydale MHP
102 Provence North Apartments
103 Courtyard Garden Apartments
104 Walgreens - Seattle
105 Apache Village Apartments
106 Walgreens Retail Building - Gresham
107 Westridge Plaza
108 University Village Apartments M M
109 The Plaza at Stonebridge
110 Henderson Plaza
111 East Town Plaza
112 Lake Chabot Medical Center
113 Garden City Town Center
114 Las Brisas Apartments
115 Bear Ground Apartments I, II, III
116 Walgreens Retail Building - Tucson
117 Mark Apartments M M
118 Bank Properties
119 4646 Bronze Way (1H)
120 4647 Bronze Way (1H)
121 Aspenwood Apartments
122 Lauderdale Parc Apartments
123 West County Plaza
124 Sheldon Plaza Retail Center
125 Olde Falls Village
126 The Highland Office Building
127 A-1 Storage of Lafayette
128 The Gaither Center
129 Willowbrook North Townhome Apartment Complex
130 Casual Male Corporate Office Building
131 Walgreens Retail Building - Portland
132 Lake Placid Village Apartments
133 Cumberland Apartments
134 Rainbow Shopping Center
135 Snowfall Plaza M M
136 Finley Terrace Apartments
137 417 W. Barry Avenue/3030 N. Sheridan Road
138 Bradford Gwinnett Apartments
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Original
Principal ENDORS. INTRVN
Loan # Property Name Balance NOTE (to Norwest) MORTGAGE ASSIGN
- - -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
139 Furr's Grocery Store
140 South Brunswick Industrial Park
141 Villager Square Shopping Center
142 Flint Hill Building
143 Peppertree Apartments
144 Star Ranch Plaza
145 Morehead Hills Apartments
146 Forest Park Apartments
147 Freeway Plaza Building
148 Coconut Creek Apartments
149 The Colonial Arms Apartments
150 Norwood Park North Office Building
151 Chevy Chase Arcade
152 Holcombe Medical Building
153 Youngstown Mobile Home Park
154 Kinston Marketplace
155 Versailles Apartments
156 Chaparral Apartments
157 Revco Drug Store
158 Oakwood Estates Apartments
159 Innsbruck Villa Apartments
160 The Pathmark Grocery Store
161 La Carre Apartments
162 Westside Plaza Shopping Center
163 Woodhollow Apartments
164 Park View Place Apartments
165 2500 Packard Road
166 K-Mart Plaza
167 Portland Contessa Apartments
168 Lovers Lane Animal Hospital/Clinic
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
TITLE TITLE POLICY/COMM. COMMENTS
Loan # POLICY/COMM (Date of Origination)
- - ------ -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1
2 NOT DATED S/B 8/27/97
3 NOT DATED
4 NOT DATED S/B 8/27/97
5 8/28/97 S/B 8/27/97
6 NOT DATED S/B 8/27/97
7 NOT DATED S/B 8/27/97
8 NOT DATED
9 NOT DATED S/B 8/27/97
10 NOT DATED
11 NOT DATED S/B 8/27/97
12 NOT DATED S/B 8/27/97
13 NOT DATED
14 4/15/97 S/B 8/27/97
15 NOT DATED S/B 8/27/97
16 NOT DATED
17 NOT DATED
18 NOT DATED
19 NOT DATED
20 M M
21 NOT DATED S/B 12/19/97
22 NOT DATED S/B 12/19/97
23 S/B 12/19/97
24 12/18/97 S/B 12/19/97
25 NOT DATED S/B 12/19/97
26 NOT DATED S/B 11/12/97
27 NOT DATED S/B 1/22/97
28
29 NOT DATED
30
31 12/30/97 S/B 12/29/97
32 NOT DATED
33 NOT DATED
34 NOTE FOR $14,190,000 SECURED BY FIVE PROPERTIES
35 NOTE FOR $14,190,000 SECURED BY FIVE PROPERTIES
36 NOTE FOR $14,190,000 SECURED BY FIVE PROPERTIES
37 NOTE FOR $14,190,000 SECURED BY FIVE PROPERTIES
38 NOTE FOR $14,190,000 SECURED BY FIVE PROPERTIES
39 NOT DATED
40 NOT DATED S/B / 11/12/97
41
42
43 9/26/97 S/B 9/15/97
44 NOT DATED S/B 11/3/96
45 NOTE FOR $10,370,000 SECURED BY 6 MORTGAGES; NOTE IS NOT DATED
46 NOTE FOR $10,370,000 SECURED BY 6 MORTGAGES; NOTE IS NOT DATED
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
TITLE TITLE POLICY/COMM. COMMENTS
Loan # POLICY/COMM (Date of Origination)
- - ------ -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
47 NOTE FOR $10,370,000 SECURED BY 6 MORTGAGES; NOTE IS NOT DATED
48 NOTE FOR $10,370,000 SECURED BY 6 MORTGAGES; NOTE IS NOT DATED
49 NOTE FOR $10,370,000 SECURED BY 6 MORTGAGES; NOTE IS NOT DATED
50 NOTE FOR $10,370,000 SECURED BY 6 MORTGAGES; NOTE IS NOT DATED
51 7/30/97 S/B 12/30/97
52 11/20/97 S/B 11/17/97
53 1/2/98 S/B12/31/97
54 NOT DATED S/B 9/5/97
55
56 11/12/97 S/B 12/15/87
57
58 11/15/97 S/B 11/25/97
59 NOT DATED S/B 12/16/97
60
61 8/14/97 S/B 11/25/97 BORROWER NAME ON ALL DOCS HAS CHAMPAIGN URBANA CROSSED OUT IN PEN,
NOT INITIALED
62
63 NOT DATED S/B 12/15/97
64 NOT DATED S/B 1/22/98
65 NOT DATED S/B 12/19/97
66 NOT DATED S/B 11/21/97
67 11/19/97
68
69
70 5/20/97 S/B 11/25/97
71 NOT DATED
72
73
74 NOT DATED
75 NOT DATED S/B 11/5/97
76 M M
77 9/18/1997 S/B 9/15/97 NOTE CONSOLIDATION NOT DATED S/B 9/15/97
78 9/4/97 S/B 8/29/97
79 NOT DATED S/B 12/23/97
80 9/5/89 S/B 9/18/97
81 NOT DATED S/B 12/15/97
82 NOT DATED S/B12/12/97
83 NOT DATED S/B 11/25/97
84 10/0/97 S/B 10/22/97
85
86 11/19/97 S/B 11/4/97
87
88 11/4/97 S/B 1/5/98
89 NOT DATED S/B 9/18/96
90
91
92
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
TITLE TITLE POLICY/COMM. COMMENTS
Loan # POLICY/COMM (Date of Origination)
- - ------ -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
93 S/B 9/15/97
94
95 NOT DATED
96 8/15/97 S/B 10/7/97
97 9/25/95 S/B 9/30/97
98
99 11/18/97 S/B 11/25/97
100 10/23/97 S/B 10/14/97
101 10/15/97 S/B 10/13/97
102 8/14/97 S/B 8/25/97
103 NOT DATED S/B 11/3/97
104 10/20/97 S/B 10/16/97
105 NOT DATED
106
107 NOT DATED S/B 11/25/97
108 M M
109 8/27/97 S/B 9/23/97
110 10/2/97 S/B 9/29/97
111
112 10/1/97 S/B 11/20/97
113 NOT DATED S/B 9/24/97
114 9/12/97 S/B 11/19/97
115 9/29/97 S/B 9/26/97
116 11/10/97 S/B 12/15/97
117 11/14/97 S/B 11/7/97
118 10/15/97 S/B 10/10/97
119
120
121 NOT DATED
122
123 9/15/97 S/B 10/10/97
124
125
126
127 10/1/97 S/B 10/15/97
128 NOT DATED
129 11/12/97 S/B 11/25/97
130 NOT DATED
131
132 12/12/97 S/B 12/4/97
133
134 ASSIGNMENT OF DEED OF TRUST NOT SIGNED
135 NOT DATED LOAN DOCS SHOW GMAC AS LENDER; ASSIGN DOCS ARE FROM GMAC TO COLUMN
136 8/5/97 S/B 8/1/97
137
138 NOT DATED S/B 12/5/97
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
TITLE TITLE POLICY/COMM. COMMENTS
Loan # POLICY/COMM (Date of Origination)
- - ------ -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
139 11/20/97 S/B 12/5/97
140
141 NOT DATED S/B 12/17/97
142 NOT DATED S/B 11/5/97
143 NOT DATED
144
145 11/3/97 S/B 1/5/98
146 1/5/98
147 NOT DATED S/B 10/10/97
148 12/6/97 S/B 10/28/97
149
150 9/24/97 S/B 9/17/97
151
152 9/29/97 S/B 11/21/97
153 NOT DATED S/B 11/03/97
154 10/30/97 S/B 10/22/97
155
156
157 12/29/97 S/B 12/18/97
158 10/22/1997 S/B 10/13/97
159 NOT DATED
160
161 NOT DATED S/B 12/30/97
162 8/28/97 S/B 8/11/97
163
164 NOT DATED S/B 9/18/97
165
166 NOT DATED
167 12/3/97 S/B 1/5/98
168
</TABLE>
<PAGE>
EXHIBIT C
LETTER OF REPRESENTATIONS AMONG DEPOSITOR,
TRUSTEE AND INITIAL DEPOSITORY
C-1-1
<PAGE>
EXHIBIT D-1
FORM OF SERVICER REQUEST FOR RELEASE
[Date]
Norwest Bank Minnesota, National Association
Three New York Plaza
New York, New York 10004
Attention: Corporate Trust Services (CMBS)
Re: DLJ Commercial Mortgage Corp., Series 1998-CF1
In connection with the administration of the Mortgage Files held by or on
behalf of you as trustee under a certain Pooling and Servicing Agreement, dated
as of March 1, 1998 (the "Pooling and Servicing Agreement"), among DLJ
Commercial Mortgage Corp. as depositor, the undersigned as servicer (the
"Servicer"), Clarion Partners, LLC as special servicer and you as trustee (in
such capacity, the "Trustee") and REMIC administrator, the undersigned as
Servicer hereby requests a release of the Mortgage File (or the portion thereof
specified below) held by or on behalf of you as Trustee with respect to the
following described Mortgage Loan for the reason indicated below.
Mortgagor's Name:
Address:
Loan No.:
If only particular documents in the Mortgage File are requested, please specify
which:
Reason for requesting Mortgage File (or portion thereof):
______ 1. Mortgage Loan paid in full.
The undersigned hereby certifies that all amounts received
in connection with the Mortgage Loan that are required to be
credited to the Collection Account pursuant to the Pooling
and Servicing Agreement, have been or will be so credited.
______ 2. Other. (Describe)
The undersigned acknowledges that the above Mortgage File (or requested
portion thereof) will be held by the undersigned in accordance with the
provisions of the Pooling and Servicing Agreement and will be returned to you or
your designee within ten (10) days of our receipt
D-1-1
<PAGE>
thereof, unless the Mortgage Loan has been paid in full, in which case the
Mortgage File (or such portion thereof) will be retained by us permanently.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Pooling and Servicing Agreement.
BANC ONE MORTGAGE CAPITAL
MARKETS, LLC
as Servicer
By: ___________________________
Name:
Title:
D-1-2
<PAGE>
EXHIBIT D-2
FORM OF SPECIAL SERVICER REQUEST FOR RELEASE
[Date]
Norwest Bank Minnesota, National Association
Three New York Plaza
New York, New York 10004
Attention: Corporate Trust Services (CMBS)
Re: DLJ Commercial Mortgage Corp., Series 1998-CF1
In connection with the administration of the Mortgage Files held by or on
behalf of you as trustee under a certain Pooling and Servicing Agreement, dated
as of March 1, 1998 (the "Pooling and Servicing Agreement"), among DLJ
Commercial Mortgage Corp. as depositor, Banc One Mortgage Capital Markets, LLC,
as servicer, the undersigned as special servicer (the "Special Servicer") and
you as trustee (in such capacity, the "Trustee") and REMIC administrator, the
undersigned as Special Servicer hereby requests a release of the Mortgage File
(or the portion thereof specified below) held by or on behalf of you as Trustee
with respect to the following described Mortgage Loan for the reason indicated
below.
Mortgagor's Name:
Address:
Loan No.:
If only particular documents in the Mortgage File are requested, please specify
which:
Reason for requesting Mortgage File (or portion thereof):
______ 1. The Mortgage Loan is being foreclosed.
______ 2. Other. (Describe)
The undersigned acknowledges that the above Mortgage File (or requested
portion thereof) will be held by the undersigned in accordance with the
provisions of the Pooling and Servicing Agreement and will be returned to you or
your designee within ten (10) days of our receipt thereof, unless the Mortgage
Loan is being foreclosed, in which case the Mortgage File (or such portion
thereof) will be returned when no longer required by us for such purpose.
D-2-1
<PAGE>
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Pooling and Servicing Agreement.
CLARION PARTNERS, LLC
as Special Servicer
By: ________________________________
Name:
Title:
D-2-2
<PAGE>
EXHIBIT E-1
FORM OF TRUSTEE REPORT
E-1-1
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
TRUSTEE REPORT
Table of Contents
STATEMENT SECTIONS PAGE(s)
------------------ -------
Certificate Distribution Detail 2
Certificate Factor Detail 3
Other Required Information 4
Ratings Detail 5
Current Mortgage Loan and Property Stratification Tables 6-8
Mortgage Loan Detail 9
Principal Prepayment Detail 10
Historical Detail 11
Reconciliation Detail 12
Delinquency Loan Detail 13
Specially Serviced Loan Detail 14-15
Modified Loan Detail 16
Liquidated Loan Detail 17
<TABLE>
<CAPTION>
Underwriter Servicer Special Servicer
<S> <C> <C>
Donaldson, Lufkin & Jenrette Banc One Mortgage Capital Markets, LLC Clarion Partners
Securities Corporation 1717 Main Street, 14th Floor 335 Madison Avenue, 7th Floor
277 Park Avenue Dallas, TX 75201 New York, NY 10017
New York, NY 10172
Contact: N. Dante LaRocca Contact: Paul G. Smyth Contact: Bruce G. Morrison
Phone Number: (212)892-3000 Phone Number: (214)290-2505 Phone Number:(212)883-2500
</TABLE>
This report has been compiled from information provided to Norwest by various
third parties, which may include the Servicer, Master Servicer, Special Servicer
and others. Norwest has not independently confirmed the accuracy of information
received from these third parties and assumes no duty to do so. Norwest
expressly disclaims any responsibility for the accuracy or completeness of
information furnished by third parties.
Copyright 1997, Norwest Bank Minnesota, N.A. Page 1 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Certificate Distribution Detail
<TABLE>
<CAPTION>
Pass-Through Original Beginning Principal Interest
Class CUSIP Rate Balance Balance Distribution Distribution
- - ----- ----- ------------ -------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
A-1A 0.000000% 0.00 0.00 0.00 0.00
A-1B 0.000000% 0.00 0.00 0.00 0.00
A-2 0.000000% 0.00 0.00 0.00 0.00
A-3 0.000000% 0.00 0.00 0.00 0.00
B-1 0.000000% 0.00 0.00 0.00 0.00
B-2 0.000000% 0.00 0.00 0.00 0.00
B-3 0.000000% 0.00 0.00 0.00 0.00
B-4 0.000000% 0.00 0.00 0.00 0.00
B-5 0.000000% 0.00 0.00 0.00 0.00
B-6 0.000000% 0.00 0.00 0.00 0.00
B-7 0.000000% 0.00 0.00 0.00 0.00
C 0.000000% 0.00 0.00 0.00 0.00
D 0.000000% 0.00 0.00 0.00 0.00
R-I 0.000000% 0.00 0.00 0.00 0.00
R-II 0.000000% 0.00 0.00 0.00 0.00
R-III 0.000000% 0.00 0.00 0.00 0.00
- - -----------------------------------------------------------------------------
Totals 0.00 0.00 0.00 0.00
=============================================================================
<CAPTION>
Realized Loss/ Current
Prepayment Additional Trust Total Ending Subordination
Class Penalties Fund Expenses Distribution Balance Level(1)
- - ----- ---------- ---------------- ------------ ------- -------------
<S> <C> <C> <C> <C> <C>
A-1A 0.00 0.00 0.00 0.00 0.00%
A-1B 0.00 0.00 0.00 0.00 0.00%
A-2 0.00 0.00 0.00 0.00 0.00%
A-3 0.00 0.00 0.00 0.00 0.00%
B-1 0.00 0.00 0.00 0.00 0.00%
B-2 0.00 0.00 0.00 0.00 0.00%
B-3 0.00 0.00 0.00 0.00 0.00%
B-4 0.00 0.00 0.00 0.00 0.00%
B-5 0.00 0.00 0.00 0.00 0.00%
B-6 0.00 0.00 0.00 0.00 0.00%
B-7 0.00 0.00 0.00 0.00 0.00%
C 0.00 0.00 0.00 0.00 0.00%
D 0.00 0.00 0.00 0.00 0.00%
R-I 0.00 0.00 0.00 0.00 0.00%
R-II 0.00 0.00 0.00 0.00 0.00%
R-III 0.00 0.00 0.00 0.00 0.00%
- - -----------------------------------------------------------------------------
Totals 0.00 0.00 0.00 0.00
=============================================================================
</TABLE>
<TABLE>
<CAPTION>
Original Beginning Ending
Pass-Through Notional Notional Interest Prepayment Total Notional
Class CUSIP Rate Balance Amount Distribution Penalties Distribution Amount
- - ----- ----- ------------ ------- --------- ------------ ---------- ------------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CP 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00
S 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00
</TABLE>
(1) Calculated by taking (A) the sum of the ending certificate balance of all
classes less (B) the sum of (i) the ending certificate balance of the designated
class and (ii) the ending certificate balance of all classes which are not
subordinate to the designated class and dividing the result by (A).
Copyright 1997, Norwest Bank Minnesota, N.A. Page 2 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Certificate Factor Detail
<TABLE>
<CAPTION>
Realized Loss/
Additional
Beginning Principal Interest Prepayment Trust Ending
Class CUSIP Balance Distribution Distribution Penalties Fund Expenses Balance
- - ----- ------ ----------- ------------ ------------ --------- -------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
A-1A 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
A-1B 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
A-2 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
A-3 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
B-1 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
B-2 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
B-3 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
B-4 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
B-5 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
B-6 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
B-7 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
C 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
D 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
R-I 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
R-II 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
R-III 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
</TABLE>
Beginning Ending
Notional Interest Prepayment Notional
Class CUSIP Amount Distribution Penalties Amount
- - ------- ----- ------------ ------------ ----------- ---------
CP 0.00000000 0.00000000 0.00000000 0.00000000
S 0.00000000 0.00000000 0.00000000 0.00000000
Copyright 1997, Norwest Bank Minnesota, N.A. Page 3 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
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Reports Available on the
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Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Other Required Information
Available Distribution Amount 0.00
Aggregate Number of Outstanding Loans 0
Aggregate Unpaid Principal Balance of Loans 0.00
Aggregate Amount of Servicing Fee 0.00
Aggregate Amount of Special Servicing Fee 0.00
Aggregate Amount of Trustee Fee 0.00
Aggregate Trust Fund Expenses 0.00
Specially Serviced Loans not Delinquent
Number of Outstanding Loans 0
Aggregate Unpaid Principal Balance 0.00
Appraisal Reduction Amount
Appraisal Date Appraisal
Loan Reduction Reduction
Number Amount Effected
- - ------ --------- --------------
- - -----------------------------------------------------
Total
=====================================================
Copyright 1997, Norwest Bank Minnesota, N.A. Page 4 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Ratings Detail
Original Ratings Current Ratings (1)
---------------- -------------------
Class CUSIP DCR Fitch Moody's S & P DCR Fitch Moody's S & P
- - ----- ----- --- ----- ------- ----- --- ----- ------- -----
CP
S
A-1A
A-1B
A-2
A-3
B-1
B-2
B-3
B-4
B-5
B-6
B-7
C
NR - Designates that the class was not rated by the above agency at the
time of original issuance.
X - Designates that the above rating agency did not rate any classes
in this transaction at the time of original issuance.
N/A - Data not available this period.
1) For any class not rated at the time of original issuance by any particular
rating agency, no request has been made subsequent to issuance to obtain rating
information, if any, from such rating agency. The current ratings were obtained
directly from the applicable rating agency within 30 days of the payment date
listed above. The ratings may have changed since they were obtained. Because the
ratings may have changed, you may want to obtain current ratings directly from
the rating agencies.
Duff & Phelps Credit Rating Co. Fitch IBCA, Inc.
55 East Monroe Street One State Street Plaza
Chicago, Illinois 60603 New York, New York 10004
(312) 368-3100 (212) 908-0500
Moody's Investors Service Standard & Poor's Rating Services
99 Church Street 26 Broadway
New York, New York 10007 New York, New York 10004
(212) 553-0300 (212) 208-8000
Copyright 1997, Norwest Bank Minnesota, N. A. Page 5 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
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Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Current Mortgage Loan and Property Stratification Tables
Scheduled Balance
% of
# of Scheduled Agg. WAM Weighted
Scheduled Balance Loans Balance Bal. (2) WAC Avg DSCR(1)
- - ----------------- ------ --------- ----- ---- --- -----------
Totals
State (3)
% of
# of Scheduled Agg. WAM Weighted
State Props. Balance Bal. (2) WAC Avg DSCR(1)
- - ----- ------ ---------- ---- ---- --- -----------
Totals
See footnotes on last page of this section.
Copyright 1997, Norwest Bank Minnesota, N.A. Page 6 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
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Reports Available on the
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Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Current Mortgage Loan and Property Stratification Tables
<TABLE>
<CAPTION>
Debt Service Coverage Ratio
% of
Debt Service # of Scheduled Agg. WAM Weighted
Coverage Ratio Loans Balance Bal. (2) WAC Avg DSCR (1)
-------------- ----- --------- ----- --- --- ------------
<S> <C> <C> <C> <C> <C> <C>
----- --------- ----- --- --- ------------
Totals
===== ========= ===== === === ============
</TABLE>
<TABLE>
<CAPTION>
Property Type (3)
% of
# of Scheduled Agg. WAM Weighted
Property Type Loans Balance Bal. (2) WAC Avg DSCR (1)
------------- ----- --------- ----- --- --- ------------
<S> <C> <C> <C> <C> <C> <C>
----- --------- ----- --- --- ------------
Totals
===== ========= ===== === === =============
</TABLE>
<TABLE>
<CAPTION>
Note Rate
% of
# of Scheduled Agg. WAM Weighted
Note Rate Loans Balance Bal. (2) WAC Avg DSCR (1)
--------- ----- --------- ----- --- --- ------------
<S> <C> <C> <C> <C> <C> <C>
----- --------- ----- --- --- ------------
Totals
===== ========= ===== === === ============
</TABLE>
<TABLE>
<CAPTION>
Seasoning
% of
# of Scheduled Agg. WAM Weighted
Seasoning Loans Balance Bal. (2) WAC Avg DSCR (1)
--------- ----- --------- ---- --- --- ------------
<S> <C> <C> <C> <C> <C> <C>
----- --------- ---- --- --- ------------
Totals
===== ========= ==== === === ============
</TABLE>
See footnotes on last page of this section.
Page 7 of 17
Copyright 1997, Norwest Bank Minnesota, N.A.
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Current Mortgage Loan and Property Stratification Tables
<TABLE>
<CAPTION>
Anticipated Remaining Term (ARD and Balloon Loans)
% of
Anticipated Remaining # of Scheduled Agg. WAM Weighted
Term (2) Loans Balance Bal. (2) WAC Avg DSCR (1)
- - -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- - -------------------------------------------------------------------------------------------------------------------
Totals
===================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Remaining Stated Term (Fully Amortizing Loans)
% of
Remaining Stated # of Scheduled Agg. WAM Weighted
Term Loans Balance Bal. (2) WAC Avg DSCR (1)
- - -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- - -------------------------------------------------------------------------------------------------------------------
Totals
===================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Remaining Amortization Term (ARD and Balloon Loans)
% of
Remaining Amortization # of Scheduled Agg. WAM Weighted
Term Loans Balance Bal. (2) WAC Avg DSCR (1)
- - -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- - -------------------------------------------------------------------------------------------------------------------
Totals
===================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Age of Most Recent NOI
% of
Age of Most # of Scheduled Agg. WAM Weighted
Recent NOI Loans Balance Bal. (2) WAC Avg DSCR (1)
- - -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- - -------------------------------------------------------------------------------------------------------------------
Totals
===================================================================================================================
</TABLE>
(1) Debt Service Coverage Ratios are calculated as described in the prospectus,
values are updated periodically as new NOI figures become available from
borrowers on an asset level. The Trustee makes no representations as to the
accuracy of the data provided by the borrower for this calculation.
(2) Anticipated Remaining Term and WAM are each calculated based upon the term
from the current month to the earlier of the Anticipated Repayment Date, if
applicable, and the maturity date
(3) Data in this table was calculated by allocating pro-rata the current loan
information to the properties based upon the Cut-off Date Balance of the
related mortgage loan as disclosed in the offering document.
Note: "Scheduled Balance" has the meaning assigned thereto in the CSSA Standard
Information Package.
An ARD Loan constitutes a "Hyper-Amortization Loan" as defined in the offering
document.
Page 8 of 17
Copyright 1997, Norwest Bank Minnesota, N.A.
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Mortgage Loan Detail
<TABLE>
<CAPTION>
Anticipated
Loan Property Interest Principal Gross Repayment Maturity
Number ODCR Type(1) City State Payment Payment Coupon Date Date
- - ------- ---- ------- ---- ----- -------- ----------- ------- ----------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- - -----------------------------------------------------------------------------------------------------------------------------------
Totals
===================================================================================================================================
<CAPTION>
Neg. Beginning Ending Paid Appraisal Appraisal Res. Mod.
Loan Amort Scheduled Scheduled Thru Reduction Reduction Strat. Code
Number (Y/N) Balance Balance Date Date Amount (2) (3)
- - ------- ------- ---------- --------- ------ ------------ ----------- -------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- - -----------------------------------------------------------------------------------------------------------------------------------
Totals
===================================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
(1) Property Type Code (2) Resolution Strategy Code (3) Modification Code
------------------------ ----------------------------- -----------------------
<S> <C> <C> <C> <C>
MF - Multi-Family OF - Office 1 - Modification 7 - REO 1 - Maturity Date Extension
RT - Retail MU - Mixed Use 2 - Foreclosure 8 - Resolved 2 - Amortization Change
HC - Health Care LO - Lodging 3 - Bankruptcy 9 - Pending Return 3 - Principal Write-Off
IN - Industrial SS - Self Storage 4 - Extension to Master Servicer 4 - Combination
WH - Warehouse OT - Other 5 - Note Sale 10 - Deed In Lieu Of
MH - Mobile Home Park 6 - DPO Foreclosure
</TABLE>
Copyright 1997, Norwest Bank Minnesota, N.A. Page 9 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Principal Prepayment Detail
<TABLE>
<CAPTION>
Offering Document Principal Prepayment Amount Prepayment Penalties
--------------------------- ---------------------
Loan Number Cross-Reference Payoff Amount Curtailment Amount Prepayment Premium Yield Maintenance Premium
- - ----------- ------------------ ------------- ------------------ ------------------ -------------------------
<S> <C> <C> <C> <C> <C>
Totals
</TABLE>
Copyright 1997, Norwest Bank Minnesota, N.A. Page 10 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Historical Detail
<TABLE>
<CAPTION>
Delinquencies
--------------
Distribution 30-59 Days 60-89 Days 90 Days or More Foreclosure REO Modifications
Date # Balance # Balance # Balance # Balance # Balance # Balance
- - ------------ ------------- ------------- --------------- ---------------- --------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
<CAPTION>
Prepayments Rate and Maturities
------------------------------------------- -----------------------------------------------
Distribution Curtailments Payoff Next Weighted Avg.
Date # Amount # Amount Coupon Remit WAM
- - ------------ ---------------- ------------------ ----------------------------- --------
<S> <C> <C> <C> <C> <C>
</TABLE>
Note: Foreclosure and REO Totals are excluded from the delinquencies aging
categories.
Page 11 of 17
Copyright 1997, Norwest Bank Minnesota, N.A.
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Reconciliation Detail
Advance Summary Servicing Fee Breakdowns
P & I Advances Outstanding 0.00 Current Period Accrued Servicing Fees 0.00
Servicing Advances Outstanding 0.00 Less Delinquent Servicing Fees 0.00
Less Reductions to Servicing Fees 0.00
Plus Servicing Fees for Delinquent
Payments Received 0.00
Plus Adjustments for Prior Servicing
Calculation 0.00
Total Servicing Fees Collected 0.00
<TABLE>
<CAPTION>
Certificate Interest Reconciliation
Accrued Net Aggregate Distributable Distributable Additional Interest Remaining Unpaid
Certificate Prepayment Certificate Certificate Interest Trust Fund Distribution Distributable
Class Interest Interest Shortfall Interest Adjustment Expenses Certificate Interest
- - ----- ----------- ------------------ ------------- -------------------- ---------- ------------ --------------------
<S> <C> <C> <C> <C> <C> <C> <C>
CP
S
A-1A
A-1B
A-2
A-3
B-1
B-2
B-3
B-4
B-5
B-6
B-7
C
- - -----------------------------------------------------------------------------------------------------------------------------------
Total
===================================================================================================================================
</TABLE>
Copyright 1997, Norwest Bank Minnesota, N.A.
Page 12 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Delinquency Loan Detail
<TABLE>
<CAPTION>
Offering # of Current Outstanding Status of Resolution
Document Months Paid Through P & I P & I Mortgage Strategy Servicing Foreclosure
Loan Number Cross-Reference Delinq. Date Advances Advances** Loan (1) Code (2) Transfer Date Date
- - ----------- --------------- ------- ------------- -------- ------------ ---------- -------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- - ----------- --------------- ------- ------------- -------- ------------ ---------- -------- ------------- ----------
Totals
- - ----------- --------------- ------- ------------- -------- ------------ ---------- -------- ------------- ----------
<CAPTION>
Current Outstanding
Servicing Servicing REO
Loan Number Advances Advances Bankruptcy Date Date
- - ----------- ----------- ------------ ----------------- -------
<S> <C> <C> <C> <C>
- - ----------- ----------- ------------ ----------------- -------
Totals
- - ----------- ----------- ------------ ----------------- -------
</TABLE>
(1) Status of Mortgage Loan
---------------------------
A - Payment Not Received 2 - Two Months Delinquent
But Still in Grace Period 3 - Three Or More Months Delinquent
B - Late Payment But Less 4 - Assumed Scheduled Payment
Than 1 Month Delinquent (Performing Matured Balloon)
0 - Current 7 - Foreclosure
1 - One Month Delinquent 9 - REO
(2) Resolution Strategy Code
---------------------------
1 - Modification 7 - REO
2 - Foreclosure 8 - Resolved
3 - Bankruptcy 9 - Pending Return
4 - Extension to Master Servicer
5 - Note Sale 10 - Deed In Lieu Of
6 - DPO Foreclosure
** Outstanding P & I Advances include the current period advance
Copyright 1997, Norwest Bank Minnesota, N.A. Page 13 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
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Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
<TABLE>
<CAPTION>
Specially Serviced Loan Detail - Part 1
Offering Servicing Resolution
Distribution Loan Document Transfer Strategy Scheduled Property
Date Number Cross-Reference Date Code(1) Balance Type(2) State
- - ------------- ------ --------------- ---------- ----------- ---------- -------- -----
<S> <C> <C> <C> <C> <C> <C> <C>
<CAPTION>
Net Remaining
Distribution Interest Actual Operating NOI Note Maturity Amortization
Date Rate Balance Income Date DSCR Date Date Term
- - ------------ -------- -------- ---------- ----- ---- ------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>
<TABLE>
<CAPTION>
(1) Resolution Strategy Code (2) Property Type Code
---------------------------- ----------------------
<S> <C> <C> <C>
1 - Modification 7 - REO MF - Multi-Family OF - Office
2 - Foreclosure 8 - Resolved RT - Retail MU - Mixed Use
3 - Bankruptcy 9 - Pending Return HC - Health Care LO - Lodging
4 - Extension to Master Servicer IN - Industrial SS - Self Storage
5 - Note Sale 10 - Deed In Lieu Of WH - Warehouse OT - Other
6 - DPO Foreclosure MH - Mobile Home Park
</TABLE>
Copyright 1997, Norwest Bank Minnesota, N. A. Page 14 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
Reports Available on the
World Wide Web
Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Specially Serviced Loan Detail - Part 2
<TABLE>
<CAPTION>
Offering Resolution Site
Distribution Loan Document Strategy Inspection Appraisal Appraisal Other REO
Date Number Cross-Reference Code (1) Date Phase 1 Date Date Value Property Revenue Comment
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>
(1) Resolution Strategy Code
1 - Modification 7 - REO
2 - Foreclosure 8 - Resolved
3 - Bankruptcy 9 - Pending Return
4 - Extension to Master Servicer
5 - Note Sale 10 - Deed In Lieu Of
6 - DPO Foreclosure
Copyright 1997, Norwest Bank Minnesota, N.A. Page 15 of 17
<PAGE>
[LOGO] For Additional Information,
please contact
Leslie Gaskill
(212) 509-1630
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Norwest Bank Minnesota, N.A. @www.securitieslink.net/cmbs
Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Modified Loan Detail
Offering
Loan Document Pre-Modification Modification Modification
Number Cross-Reference Balance Date Description
- - ------ --------------- ----------------- ------------ -------------
Total
Copyright 1997, Norwest Bank Minnesota, N.A. Page 16 of 17
<PAGE>
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please contact
Leslie Gaskill
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Corporate Trust Services
3 New York Plaza, 15th Floor Payment Date: 4/15/98
New York, NY 10004 Record Date: 3/31/98
DLJ Commercial Mortgage Corp.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Liquidated Loan Detail
<TABLE>
<CAPTION>
Gross
Final Proceeds
Recovery Offering as a % of
Loan Determination Document Appraisal Appraisal Actual Gross Actual
Number Date Cross-Reference Date Value Balance Proceeds Balance
- - ------ ------------- --------------- --------- ---------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
------------- --------------- --------- ---------- ------- -------- --------
Current Total
------------- --------------- --------- ---------- ------- -------- --------
Cumulative Total
============= =============== ========= ========== ======= ======== ========
</TABLE>
Aggregate Net Net Proceeds Repurchased
Loan Liquidation Liquidation as a % of Realized by Seller
Number Expenses* Proceeds Actual Balance Loss (Y/N)
- - ------ ----------- ----------- -------------- -------- -----------
------------- --------------- --------- ----------
Current Total
------------- --------------- --------- ----------
Cumulative Total
============= =============== ========= ==========
* Aggregate liquidation expenses also include outstanding P & I advances
and unpaid fees (servicing, trustee, etc.).
Copyright 1997, Norwest Bank Minnesota, N.A. Page 17 of 17
<PAGE>
EXHIBIT E-2
FORM OF DETERMINATION DATE REPORT
Issue Identifier
Loan Number
Note Rate %
Scheduled P & I Payment
Scheduled Interest Amount
Scheduled Principal Amount
Curtailment Amount
Curtailment Adjustment
Curtailment Date (YYYYMMDD)
Payoff Amount
Payoff Date (YYYYMMDD)
Payoff Code
Ending Scheduled Balance
Paid Through Date (YYYYMMDD)
Loan Status Code
Recovered Delinquency Amount
Debt Service Coverage Ratio (DSCR)
Filler
E-2-1
<PAGE>
EXHIBIT E-3
FORM OF SPECIAL SERVICER REPORT
Loan Number
Property Name
Property Type
Property Address
MSA
Past Due Status
Paid-To Date
Date of Last Financial Statement
Date of Last Inspection Report
Current NOI
Number of Months of Revenue Annualized
Current Occupancy
Original Loan Balance*
Current Principal Balance
Scheduled Monthly P&I
Gross Coupon
Appraised Value at Origination and Date of Appraisal*
Current Appraised Value and Date of Appraisal
Debt Service Coverage Ratio at Origination*
Occupancy at Origination*
Current Debt Service Coverage
Modified Since Closing Date (Y/N)
Comments that the Special Servicer has regarding loan status and certain factual
matters regarding servicing including modifications, foreclosures and notices
* Special Servicer's information with respect to these items is based solely
upon information, if any, in files delivered to the Special Servicer.
E-3-1
<PAGE>
EXHIBIT E-4
FORM OF PORTFOLIO PERFORMANCE REPORT
E-4-1
<PAGE>
EXHIBIT E-4
DLJ SERIES 1998-CF1
PORTFOLIO PERFORMANCE REPORT
AS OF DETERMINATION DATE: XX/XX/XX
<TABLE>
<CAPTION>
Occupancy Average Daily Rate
Prospectus Loan Property Property Property Property Debt -------------------- --------------------
ID Number Name City State Type Service NOI DSCR Rate As of xx/xx/xx Rate As of xx/xx/xx
- - ---------- ------ -------- -------- -------- -------- ------- --- ---- ---- -------------- ---- --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>
See Worksheet entitled "PPR Instructions" for field requirements.
<PAGE>
EXHIBIT E-5
FORM OF OPERATING STATEMENT ANALYSIS
E-5-1
<PAGE>
Exhibit E-5
Operating Statement Analysis
<TABLE>
<S> <S> <C> <C> <C> <C> <C> <C>
Print Date 2/2/98
PROPERTY OVERVIEW:
LB Control Number
Servicer loan Number
Property Name
Property Type
Property Address
City, State
Current Balance/Paid to Date
Net Rentable Square Feet
Year Built/Renovated
Year of Operations Underwriting 1995 1996 1997 1998 YTD
Occupancy Rate
Average Rental Rate
INCOME:
No. of Months Annualized
Period Ended Underwriting 1995 1996 1997 1998 YTD 1997-Base 1997-1998
Statement Classification Basis Normalized Normalized Normalized as of 298 Variance Variance
Rental Income - Category 1
Rental Income - Category 2
Rental Income - Category 3
Pass Through/Escalations
Other Income
Effective Gross Income
OPERATING EXPENSES:
Real Estate Taxes
Property Insurance
Utilities
Repairs and Maintainance
Management Fees
Payroll and Benefits
Advertising and Marketing
Professional Fees
Other Expenses
Ground Rent
Total Operating Expenses
Operating Expense Ratio
Net Operating Income
Leasing Commissions
Tenant Improvements
Replacement Reserves
Other Capital Expense
Total Capital Income
NOI after Capital Expense
Debt Service (per servicer)
Cash Flow after Debt Service
DSCR (NOI/Debt Service)
DSCR (after reserves\cap exp)
</TABLE>
<PAGE>
EXHIBIT E-6
FORM OF WATCH LIST
E-6-1
<PAGE>
EXHIBIT E-6
DLJ 1998-CF1
WATCH LIST
AS OF DETERMINATION DATE OF XX/XX/XX
<TABLE>
<CAPTION>
Loan Property City State Ending Paid Maturity Current NOI Standard Additional
Number Type Scheduled Thru Date DSCR Effective Comment*** Comments****
Balance Data (12 mos)* Date**
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>
* DSCR should be calculated in an annualized and normalized manner
consistent with Exhibit K and definition of Debt Service Coverage Ratio
in the PSA.
** NOI Effective Date should reflect that date through which the 12 month
period ends for calculating Current DSCR.
*** Standard Comment must include one of the following:
Current DSCR [less than] 1.00
Current DSCR = or [less than] 80% of Cut Off DSCR
Insp. Noted Neg Material Cashflow Issues
Tenant Oco Space = or [greater than] 25% of Total has vacated
Tenant Oco Space = or [greater than] 25% of Total has decl. Bankruptcy
Number of Days Past Due = or [greater than] 30 days
Pending Maturity w/i 60 days
Other Exposure Item noted by Sub Servicer
**** Subservicer should include Additional Comments as required for further
clarity of explanation.
1
<PAGE>
EXHIBIT F-1A
FORM I OF TRANSFEROR CERTIFICATE
FOR TRANSFERS OF PRIVATE CERTIFICATES
_____________, 19__
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attention: Corporate Trust Services (CMBS)
Re: DLJ Commercial Mortgage Corp., Commercial Mortgage Pass-Through
Certificates, Series 1998-CF1, Class ____, [having an initial
aggregate Certificate Principal Balance as of March 2, 1998 (the
"Closing Date") of $__________] [evidencing a ____% Percentage
Interest in the related Class]
Dear Sirs:
This letter is delivered to you in connection with the transfer by
_____________________ (the "Transferor") to ____________________________________
(the "Transferee") of the captioned Certificates (the "Transferred
Certificates"), pursuant to Section 5.02 of the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"), dated as of March 1, 1998, among DLJ
Commercial Mortgage Corp., as Depositor, Banc One Mortgage Capital Markets, LLC,
as Servicer, Clarion Partners, LLC, as Special Servicer, and Norwest Bank
Minnesota, National Association, as Trustee and REMIC Administrator. All
capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Pooling and Servicing Agreement. The
Transferor hereby certifies, represents and warrants to you, as Certificate
Registrar, that:
1. The Transferor is the lawful owner of the Transferred Certificates
with the full right to transfer such Certificates free from any and all
claims and encumbrances whatsoever.
2. Neither the Transferor nor anyone acting on its behalf has (a)
offered, transferred, pledged, sold or otherwise disposed of any
Non-Registered Certificate, any interest in a Non-Registered Certificate or
any other similar security to any person in any manner, (b) solicited any
offer to buy or accept a transfer, pledge or other disposition of any
Non-Registered Certificate, any interest in a Non-Registered Certificate or
any other similar security from any person in any manner, (c) otherwise
approached or negotiated with respect to any Non-Registered Certificate,
any interest in a Non-Registered Certificate or any other similar security
with any person in any manner, (d) made any general solicitation with
respect
F-1A-1
<PAGE>
to any Non-Registered Certificate, any interest in a Non-Registered
Certificate or any other similar security by means of general advertising
or in any other manner, or (e) taken any other action with respect to any
Non-Registered Certificate, any interest in a Non-Registered Certificate or
any other similar security, which (in the case of any of the acts described
in clauses (a) through (e) hereof) would constitute a distribution of the
Transferred Certificates under the Securities Act of 1933, as amended (the
"Securities Act"), or would render the disposition of the Transferred
Certificates a violation of Section 5 of the Securities Act or any state
securities laws, or would require registration or qualification of the
Transferred Certificates pursuant to the Securities Act or any state
securities laws.
3. The Transferor and any person acting on behalf of the Transferor in
this matter reasonably believe that the Transferee is a "qualified
institutional buyer" as that term is defined in Rule 144A ("Rule 144A")
under the Securities Act (a "Qualified Institutional Buyer") purchasing for
its own account or for the account of another person that is itself a
Qualified Institutional Buyer. In determining whether the Transferee is a
Qualified Institutional Buyer, the Transferor and any person acting on
behalf of the Transferor in this matter has relied upon the following
method(s) of establishing the Transferee's ownership and discretionary
investments of securities (check one or more):
___ (a) The Transferee's most recent publicly available financial
statements, which statements present the information as of a date
within 16 months preceding the date of sale of the Transferred
Certificates in the case of a U.S. purchaser and within 18 months
preceding such date of sale in the case of a foreign purchaser;
or
___ (b) The most recent publicly available information appearing in
documents filed by the Transferee with the Securities and
Exchange Commission or another United States federal, state, or
local governmental agency or self-regulatory organization, or
with a foreign governmental agency or self-regulatory
organization, which information is as of a date within 16 months
preceding the date of sale of the Transferred Certificates in the
case of a U.S. purchaser and within 18 months preceding such date
of sale in the case of a foreign purchaser; or
___ (c) The most recent publicly available information appearing in a
recognized securities manual, which information is as of a date
within 16 months preceding the date of sale of the Transferred
Certificates in the case of a U.S. purchaser and within 18 months
preceding such date of sale in the case of a foreign purchaser;
or
___ (d) A certification by the chief financial officer, a person
fulfilling an equivalent function, or other executive officer of
the Transferee, specifying the amount of securities owned and
invested on a discretionary basis by the Transferee as of a
specific date on or since the close of the Transferee's most
recent fiscal year, or, in the case of a Transferee that is a
member of a "family of investment companies," as that term is
defined in Rule 144A, a certification by an executive officer of
the investment adviser specifying the amount of securities owned
by the "family of investment companies" as of a specific date on
or since the close of the Transferee's most recent fiscal year.
F-1A-2
<PAGE>
4. The Transferor and any person acting on behalf of the Transferor
understand that in determining the aggregate amount of securities owned and
invested on a discretionary basis by an entity for purposes of establishing
whether such entity is a Qualified Institutional Buyer:
(a) the following instruments and interests shall be excluded:
securities of issuers that are affiliated with the Transferee;
securities that are part of an unsold allotment to or subscription by
the Transferee, if the Transferee is a dealer; securities of issuers
that are part of the Transferee's "family of investment companies," if
the Transferee is a registered investment company; bank deposit notes
and certificates of deposit; loan participations; repurchase
agreements; securities owned but subject to a repurchase agreement;
and currency, interest rate and commodity swaps;
(b) the aggregate value of the securities shall be the cost of
such securities, except where the entity reports its securities
holdings in its financial statements on the basis of their market
value, and no current information with respect to the cost of those
securities has been published, in which case the securities may be
valued at market; and
(c) securities owned by subsidiaries of the entity that are
consolidated with the entity in its financial statements prepared in
accordance with generally accepted accounting principles may be
included if the investments of such subsidiaries are managed under the
direction of the entity, except that, unless the entity is a reporting
company under Section 13 or 15(d) of the Securities Exchange Act of
1934, as amended, securities owned by such subsidiaries may not be
included if the entity itself is a majority-owned subsidiary that
would be included in the consolidated financial statements of another
enterprise.
5. The Transferor or a person acting on its behalf has taken
reasonable steps to ensure that the Transferee is aware that the Transferor
is relying on the exemption from the provisions of Section 5 of the
Securities Act provided by Rule 144A.
6. The Transferor or a person acting on its behalf has furnished, or
caused to be furnished, to the Transferee all information regarding (a) the
Transferred Certificates and distributions thereon, (b) the nature,
performance and servicing of the Mortgage Loans, (c) the Pooling and
Servicing Agreement, (d) any credit enhancement mechanism associated with
the Transferred Certificates, and (e) all related matters, that the
Transferee has requested.
Very truly yours,
____________________________________
(Transferor)
By: ________________________________
Name: ______________________________
Title: _____________________________
F-1A-3
<PAGE>
EXHIBIT F-1B
FORM II OF TRANSFEROR CERTIFICATE
FOR TRANSFERS OF PRIVATE CERTIFICATES
_____________, 19__
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attention: Corporate Trust Services (CMBS)
Re: DLJ Commercial Mortgage Corp., Commercial Mortgage
Pass-Through Certificates, Series 1998-CF1, Class _______,
[having an initial aggregate Certificate Principal Balance
as of March 2, 1998 (the "Closing Date") of $__________]
[evidencing a ___% Percentage Interest in the related Class]
Dear Sirs:
This letter is delivered to you in connection with the transfer by
______________________ (the "Transferor") to _______________________________
(the "Transferee") of the captioned Certificates (the "Transferred
Certificates"), pursuant to Section 5.02 of the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"), dated as of March 1, 1998, among DLJ
Commercial Mortgage Corp., as Depositor, Banc One Mortgage Capital Markets, LLC,
as Servicer, Clarion Partners, LLC as Special Servicer, and Norwest Bank
Minnesota, National Association, as Trustee and REMIC Administrator. All
capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Pooling and Servicing Agreement. The
Transferor hereby certifies, represents and warrants to you, as Certificate
Registrar, that:
1. The Transferor is the lawful owner of the Transferred Certificates
with the full right to transfer such Certificates free from any and all
claims and encumbrances whatsoever.
2. Neither the Transferor nor anyone acting on its behalf has (a)
offered, transferred, pledged, sold or otherwise disposed of any
Non-Registered Certificate, any interest in a Non-Registered Certificate or
any other similar security to any person in any manner, (b) solicited any
offer to buy or accept a transfer, pledge or other disposition of any
Non-Registered Certificate, any interest in a Non-Registered Certificate or
any other similar security from any person in any manner, (c) otherwise
approached or negotiated with respect to any Non-Registered Certificate,
any interest in a Non-Registered Certificate or any other similar security
with any person in any manner, (d) made any general solicitation with
respect to any Non-Registered Certificate, any interest in a Non-Registered
Certificate or any other similar security by means of general advertising
or in any other manner, or (e) taken any other action with respect to any
Non-Registered Certificate, any interest in a Non-Registered Certificate or
any other similar security, which (in the case of any of the acts described
in clauses (a) through (e) hereof) would constitute a distribution of the
Transferred Certificates under the Securities Act of 1933, as amended (the
"Securities Act"), would render the disposition of the Transferred
Certificates a violation of Section 5 of the Securities Act or any
F-1B-1
<PAGE>
state securities laws, or would require registration or qualification of
the Transferred Certificates pursuant to the Securities Act or any state
securities laws.
Very truly yours,
____________________________________
(Transferor)
By: ________________________________
Name: ______________________________
Title: _____________________________
F-1B-2
<PAGE>
EXHIBIT F-2A
FORM I OF TRANSFEREE CERTIFICATE
FOR TRANSFERS OF PRIVATE CERTIFICATES
_____________, 19__
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attention: Corporate Trust Services (CMBS)
Re: DLJ Commercial Mortgage Corp., Commercial Mortgage
Pass-Through Certificates, Series 1998-CF1, Class _______,
[having an initial aggregate Certificate Principal Balance
as of March 2, 1998 (the "Closing Date") of $__________]
[evidencing a ___% Percentage Interest in the related Class]
Dear Sirs:
This letter is delivered to you in connection with the transfer by
______________________ (the "Transferor") to _________________________________
(the "Transferee") of the captioned Certificates (the "Transferred
Certificates"), pursuant to Section 5.02 of the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"), dated as of March 1, 1998, among DLJ
Commercial Mortgage Corp., as Depositor, Banc One Mortgage Capital Markets, LLC,
as Servicer, Clarion Partners, LLC, as Special Servicer, and Norwest Bank
Minnesota, National Association, as Trustee and REMIC Administrator. All
capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Pooling and Servicing Agreement. The
Transferor hereby certifies, represents and warrants to you, as Certificate
Registrar, that:
1. The Transferee is a "qualified institutional buyer" (a "Qualified
Institutional Buyer") as that term is defined in Rule 144A ("Rule 144A")
under the Securities Act of 1933, as amended (the "Securities Act"), and
has completed one of the forms of certification to that effect attached
hereto as Annex 1 and Annex 2. The Transferee is aware that the sale to it
is being made in reliance on Rule 144A. The Transferee is acquiring the
Transferred Certificates for its own account or for the account of another
Qualified Institutional Buyer, and understands that such Transferred
Certificates may be resold, pledged or transferred only (a) to a person
reasonably believed to be a Qualified Institutional Buyer that purchases
for its own account or for the account of another Qualified Institutional
Buyer to whom notice is given that the resale, pledge or transfer is being
made in reliance on Rule 144A, or (b) pursuant to another exemption from
registration under the Securities Act.
2. The Transferee has been furnished with all information regarding
(a) the Depositor, (b) the Transferred Certificates and distributions
thereon, (c) the nature, performance and servicing of the Mortgage Loans,
(d) the Pooling and Servicing Agreement and the Trust Fund created pursuant
thereto, (e) any credit enhancement mechanism associated with the
Transferred Certificates, and (f) all related matters, that it has
requested.
F-2A-1
<PAGE>
3. If the Transferee proposes that the Transferred Certificates be
registered in the name of a nominee, such nominee has completed the Nominee
Acknowledgment below.
Very truly yours,
____________________________________
(Transferor)
By: ________________________________
Name: ______________________________
Title: _____________________________
F-2A-2
<PAGE>
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the Transferred
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Transferee identified above, for whom the undersigned is acting
as nominee.
____________________________________
(Nominee)
By: ________________________________
Name:_______________________________
Title:______________________________
F-2A-3
<PAGE>
ANNEX 1 TO EXHIBIT F-2A
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor] (the
"Transferor") and [name of Certificate Registrar], as Certificate Registrar,
with respect to the mortgage pass-through certificates (the "Transferred
Certificates") described in the Transferee certificate to which this
certification relates and to which this certification is an Annex:
1. As indicated below, the undersigned is the chief financial officer, a
person fulfilling an equivalent function, or other executive officer of the
entity purchasing the Transferred Certificates (the "Transferee").
2. The Transferee is a "qualified institutional buyer" as that term is
defined in Rule 144A ("Rule 144A") under the Securities Act of 1933, as amended,
because (i) the Transferee owned and/or invested on a discretionary basis
$______________________(1) in securities (other than the excluded securities
referred to below) as of the end of the Transferee's most recent fiscal year
(such amount being calculated in accordance with Rule 144A) and (ii) the
Transferee satisfies the criteria in the category marked below.
___ Corporation, etc. The Transferee is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts or
similar business trust, partnership, or any organization described in
Section 501(c)(3) of the Internal Revenue Code of 1986.
___ Bank. The Transferee (a) is a national bank or a banking institution
organized under the laws of any state, U.S. territory or the District
of Columbia, the business of which is substantially confined to
banking and is supervised by the state or territorial banking
commission or similar official or is a foreign bank or equivalent
institution, and (b) has an audited net worth of at least $25,000,000
as demonstrated in its latest annual financial statements, a copy of
which is attached hereto, as of a date not more than 16 months
preceding the date of sale of the Transferred Certificates in the case
of a U.S. bank, and not more than 18 months preceding such date of
sale in the case of a foreign bank or equivalent institution.
___ Savings and Loan. The Transferee (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised and
examined by a state or federal authority having supervision over any
such institutions, or is a foreign savings and loan association or
equivalent institution and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial statements,
a copy of which is attached hereto, as of a date not more than 16
months preceding the date of sale of the Transferred Certificates in
the case
- - --------
(1) Transferee must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Transferee is a dealer, and, in that case,
Transferee must own and/or invest on a discretionary basis at least $10,000,000
in securities.
F-2A-4
<PAGE>
of a U.S. savings and loan association, and not more than 18 months
preceding such date of sale in the case of a foreign savings and loan
association or equivalent institution.
___ Broker-dealer. The Transferee is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934, as amended.
___ Insurance Company. The Transferee is an insurance company whose
primary and predominant business activity is the writing of insurance
or the reinsuring of risks underwritten by insurance companies and
which is subject to supervision by the insurance commissioner or a
similar official or agency of a state, U.S. territory or the District
of Columbia.
___ State or Local Plan. The Transferee is a plan established and
maintained by a state, its political subdivisions, or any agency or
instrumentality of the state or its political subdivisions, for the
benefit of its employees.
___ ERISA Plan. The Transferee is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of
1974.
___ Investment Advisor. The Transferee is an investment advisor registered
under the Investment Advisers Act of 1940.
___ Other. (Please supply a brief description of the entity and a
cross-reference to the paragraph and subparagraph under subsection
(a)(1) of Rule 144A pursuant to which it qualifies. Note that
registered investment companies should complete Annex 2 rather than
this Annex 1.)
- - ----------------------------------------------------------------------
- - ----------------------------------------------------------------------
- - ----------------------------------------------------------------------
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Transferee, (ii) securities that are part
of an unsold allotment to or subscription by the Transferee, if the Transferee
is a dealer, (iii) bank deposit notes and certificates of deposit, (iv) loan
participations, (v) repurchase agreements, (vi) securities owned but subject to
a repurchase agreement and (vii) currency, interest rate and commodity swaps.
For purposes of determining the aggregate amount of securities owned and/or
invested on a discretionary basis by the Transferee, the Transferee did not
include any of the securities referred to in this paragraph.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Transferee, the Transferee used
the cost of such securities to the Transferee, unless the Transferee reports its
securities holdings in its financial statements on the basis of their market
value, and no current information with respect to the cost of those securities
has been published, in which case the securities were valued at market. Further,
in determining such aggregate amount, the Transferee may have included
securities owned by subsidiaries of the Transferee, but only if such
subsidiaries are consolidated with the Transferee in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Transferee's direction.
However, such securities were not included if the Transferee is a
majority-owned, consolidated subsidiary of another enterprise and the Transferee
is not itself a reporting company under the Securities Exchange Act of 1934, as
amended.
F-2A-5
<PAGE>
5. The Transferee is familiar with Rule 144A and understands that the
Transferor and other parties related to the Transferred Certificates are relying
and will continue to rely on the statements made herein because one or more
sales to the Transferee may be in reliance on Rule 144A.
___ ___ Will the Transferee be purchasing the Transferred
Yes No Certificates only for the Transferee's own account?
6. If the answer to the foregoing question is "no," then in each case where
the Transferee is purchasing for an account other than its own, such account
belongs to a third party that is itself a "qualified institutional buyer" within
the meaning of Rule 144A, and the "qualified institutional buyer" status of such
third party has been established by the Transferee through one or more of the
appropriate methods contemplated by Rule 144A.
7. The Transferee will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice is given, the Transferee's purchase of the Transferred
Certificates will constitute a reaffirmation of this certification as of the
date of such purchase. In addition, if the Transferee is a bank or savings and
loan as provided above, the Transferee agrees that it will furnish to such
parties any updated annual financial statements that become available on or
before the date of such purchase, promptly after they become available.
____________________________________
Print Name of Transferee
By:_________________________________
Name:____________________________
Title:___________________________
Date:____________________________
F-2A-6
<PAGE>
ANNEX 2 TO EXHIBIT F-2A
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That Are Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor] (the
"Transferor") and [name of Certificate Registrar], as Certificate Registrar,
with respect to the mortgage pass-through certificates (the "Transferred
Certificates") described in the Transferee certificate to which this
certification relates and to which this certification is an Annex:
1. As indicated below, the undersigned is the chief financial officer, a
person fulfilling an equivalent function, or other executive officer of the
entity purchasing the Transferred Certificates (the "Transferee") or, if the
Transferee is a "qualified institutional buyer" as that term is defined in Rule
144A ("Rule 144A") under the Securities Act of 1933, as amended, because the
Transferee is part of a Family of Investment Companies (as defined below), is an
executive officer of the investment adviser (the "Adviser").
2. The Transferee is a "qualified institutional buyer" as defined in Rule
144A because (i) the Transferee is an investment company registered under the
Investment Company Act of 1940, and (ii) as marked below, the Transferee alone
owned and/or invested on a discretionary basis, or the Transferee's Family of
Investment Companies owned, at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Transferee's most
recent fiscal year. For purposes of determining the amount of securities owned
by the Transferee or the Transferee's Family of Investment Companies, the cost
of such securities was used, unless the Transferee or any member of the
Transferee's Family of Investment Companies, as the case may be, reports its
securities holdings in its financial statements on the basis of their market
value, and no current information with respect to the cost of those securities
has been published, in which case the securities of such entity were valued at
market.
____ The Transferee owned and/or invested on a discretionary basis
$___________________ in securities (other than the excluded securities
referred to below) as of the end of the Transferee's most recent
fiscal year (such amount being calculated in accordance with Rule
144A).
____ The Transferee is part of a Family of Investment Companies which owned
in the aggregate $______________ in securities (other than the
excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year (such amount being calculated in
accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Transferee or are part of the Transferee's
Family of Investment Companies, (ii) bank deposit notes and certificates of
deposit, (iii) loan participations, (iv) repurchase agreements, (v) securities
owned but subject to a repurchase agreement and (vi) currency, interest rate and
commodity swaps. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Transferee, or owned by
the Transferee's Family of Investment Companies, the securities referred to in
this paragraph were excluded.
F-2A-7
<PAGE>
5. The Transferee is familiar with Rule 144A and understands that the
Transferor and other parties related to the Transferred Certificates are relying
and will continue to rely on the statements made herein because one or more
sales to the Transferee will be in reliance on Rule 144A.
---- -----
Yes No Will the Transferee be purchasing the Transferred
Certificates only for the Transferee's own
account?
6. If the answer to the foregoing question is "no," then in each case where
the Transferee is purchasing for an account other than its own, such account
belongs to a third party that is itself a "qualified institutional buyer" within
the meaning of Rule 144A, and the "qualified institutional buyer" status of such
third party has been established by the Transferee through one or more of the
appropriate methods contemplated by Rule 144A.
7. The undersigned will notify the parties to which this certification is
made of any changes in the information and conclusions herein. Until such
notice, the Transferee's purchase of the Transferred Certificates will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
____________________________________
Print Name of Transferee or Adviser
By:_________________________________
Name:____________________________
Title:___________________________
IF AN ADVISER:
____________________________________
Print Name of Transferee
Date:_______________________________
F-2A-8
<PAGE>
EXHIBIT F-2B
FORM II OF TRANSFEREE CERTIFICATE
FOR TRANSFERS OF PRIVATE CERTIFICATES
_____________, 19__
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attention: Corporate Trust Services (CMBS)
Re: DLJ Commercial Mortgage Corp., Commercial Mortgage
Pass-Through Certificates, Series 1998-CF1, Class _______,
[having an initial aggregate Certificate Principal Balance
as of March 2, 1998 (the "Closing Date") of $__________]
[evidencing a ___% Percentage Interest in the related Class]
Dear Sirs:
This letter is delivered to you in connection with the transfer by
_______________________ (the "Transferor") to ________________________________
(the "Transferee") of the captioned Certificates (the "Transferred
Certificates"), pursuant to Section 5.02 of the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"), dated as of March 1, 1998, among DLJ
Commercial Mortgage Corp., as Depositor, Banc One Mortgage Capital Markets, LLC,
as Servicer, Clarion Partners, LLC, as Special Servicer, and Norwest Bank
Minnesota, National Association, as Trustee and REMIC Administrator. All
capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Pooling and Servicing Agreement. The
Transferor hereby certifies, represents and warrants to you, as Certificate
Registrar, that:
1. Transferee is acquiring the Transferred Certificates for its own account
for investment and not with a view to or for sale or transfer in connection with
any distribution thereof, in whole or in part, in any manner which would violate
the Securities Act of 1933, as amended (the "Securities Act"), or any applicable
state securities laws.
2. Transferee understands that (a) the Transferred Certificates have not
been and will not be registered under the Securities Act or registered or
qualified under any applicable state securities laws, (b) neither the Depositor
nor the Trustee is obligated so to register or qualify the Transferred
Certificates and (c) neither the Transferred Certificates nor any security
issued in exchange therefor or in lieu thereof may be resold or transferred
unless it is (i) registered pursuant to the Securities Act and registered or
qualified pursuant to any applicable state securities laws or (ii) sold or
transferred in a transaction which is exempt from such registration and
qualification and the Certificate Registrar has received (A) a certificate from
the prospective transferor substantially in the form attached as Exhibit F-1A to
the Pooling and Servicing Agreement, (B) a certificate from the prospective
transferor substantially in the form attached as Exhibit F-1B to Pooling and
Servicing Agreement and a certificate from the prospective transferee
substantially in the form attached either as Exhibit F-2A or Exhibit F-2B to the
Pooling and Servicing Agreement, or (C) an Opinion of Counsel satisfactory to
the Certificate Registrar that the transfer may be made without registration
under the Securities Act, together with the written certification(s) as to the
facts surrounding the transfer from the prospective transferor and/or
prospective transferee upon which such Opinion of Counsel is based.
F-2B-1
<PAGE>
3. The Transferee understands that it may not sell or otherwise transfer
the Transferred Certificates, any security issued in exchange therefor or in
lieu thereof or any interest in the foregoing except in compliance with the
provisions of Section 5.02 of the Pooling and Servicing Agreement, which
provisions it has carefully reviewed, and that the Transferred Certificates will
bear legends substantially to the following effect:
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
PLEDGE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY
IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH REGISTRATION OR
QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO
(A) ANY EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS
CERTIFICATE OR ANY INTEREST HEREIN ON BEHALF OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT,
EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
4. Neither the Transferee nor anyone acting on its behalf has (a) offered,
transferred, pledged, sold or otherwise disposed of any Transferred Certificate,
any interest in a Transferred Certificate or any other similar security to any
person in any manner, (b) solicited any offer to buy or accept a transfer,
pledge or other disposition of any Transferred Certificate, any interest in a
Transferred Certificate or any other similar security from any person in any
manner, (c) otherwise approached or negotiated with respect to any Transferred
Certificate, any interest in a Transferred Certificate or any other similar
security with any person in any manner, (d) made any general solicitation by
means of general advertising or in any other manner, or (e) taken any other
action, that (in the case of any of the acts described in clauses (a) through
(e) above) would constitute a distribution of the Transferred Certificates under
the Securities Act, would render the disposition of the Transferred Certificates
a violation of Section 5 of the Securities Act or any state securities law or
would require registration or qualification of the Transferred Certificates
pursuant thereto. The Transferee will not act, nor has it authorized nor will it
authorize any person to act, in any manner set forth in the foregoing sentence
with respect to the Transferred Certificates, any interest in the Transferred
Certificates or any other similar security.
5. The Transferee has been furnished with all information regarding (a) the
Depositor, (b) the Transferred Certificates and distributions thereon, (c)
nature, performance and servicing of the Mortgage Loans, (d) the Pooling and
Servicing Agreement and the Trust Fund created pursuant thereto, (e) any credit
enhancement mechanism associated with the Transferred Certificates, and (f) all
related matters, that it has requested.
6. The Transferee is an "accredited investor" within the meaning of
paragraph (1), (2), (3) or (7) of Rule 501(a) under the Securities Act or an
entity in which all the equity owners come within such paragraphs and has such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of an investment in the Transferred
Certificates; the
F-2B-2
<PAGE>
Transferee has sought such accounting, legal and tax advice as it has considered
necessary to make an informed investment decision; and the Transferee is able to
bear the economic risks of such an investment and can afford a complete loss of
such investment.
7. If the Transferee proposes that the Transferred Certificates be
registered in the name of a nominee, such nominee has completed the Nominee
Acknowledgment below.
Very truly yours,
____________________________________
(Transferee)
By: ________________________________
Name:____________________________
Title:___________________________
Date:____________________________
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the Transferred
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Transferee identified above, for whom the undersigned is acting
as nominee.
____________________________________
(Nominee)
By:_________________________________
Name:_______________________________
Title:______________________________
F-2B-3
<PAGE>
EXHIBIT G
FORM OF TRANSFEREE CERTIFICATE
IN CONNECTION WITH ERISA
[Date]
Norwest Bank Minnesota, National Association
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attention: Corporate Trust Services (CMBS)
Re: DLJ Commercial Mortgage Corp., Commercial Mortgage
Pass-Through Certificates, Series 1998-CF1, Class ___,
[having an initial aggregate Certificate Principal Balance
as of March 2, 1998 (the "Closing Date") of $______________]
[evidencing a ____% Percentage Interest in the related
Class]
Dear Sirs:
This letter is delivered to you in connection with the transfer by
_________________ (the "Transferor") to _________________ (the "Transferee") of
the captioned Certificates (the "Transferred Certificates"), pursuant to Section
5.02 of the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of March 1, 1998, among DLJ Commercial Mortgage Corp. as
depositor, Banc One Mortgage Capital Markets, LLC, as servicer, Clarion
Partners, LLC, as special servicer, and Norwest Bank Minnesota, National
Association, as trustee and REMIC administrator. All capitalized terms used but
not otherwise defined herein shall have the respective meanings set forth in the
Pooling and Servicing Agreement. The Transferee hereby certifies, represents and
warrants to you, as Certificate Registrar, as follows (check the applicable
paragraph):
___ The Transferee is not an employee benefit plan or other retirement
arrangement, including an individual retirement account or annuity, a Keogh
plan or a collective investment fund or separate account in which such
plans, accounts or arrangements are invested, including an insurance
company general account, that is subject to the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or the Internal Revenue Code of
1986 (the "Code"; and each such employee benefit plan or other retirement
arrangement, a "Plan"), and the Transferee is not directly or indirectly
purchasing the Transferred Certificates on behalf of, as named fiduciary
of, as trustee of, or with assets of a Plan.
G-1
<PAGE>
___ The Transferee is using funds from an insurance company general account to
acquire the Transferred Certificates, however, the purchase and holding of
such Certificates by such Person is exempt from the prohibited transaction
provisions of Section 406 of ERISA and Section 4975 of the Code under
Sections I and III of Prohibited Transaction Class Exemption 95-60.
Very truly yours,
____________________________________
(Transferee)
By:_________________________________
Name:
Title:
G-2
<PAGE>
EXHIBIT H-1
FORM OF TRANSFER AFFIDAVIT AND AGREEMENT
FOR TRANSFERS OF RESIDUAL CERTIFICATES
STATE OF )
) ss:
COUNTY OF )
____________________, being first duly sworn, deposes and says that:
1. He/She is the ____________________ of ____________________ (the
prospective transferee (the "Transferee") of DLJ Commercial Mortgage Corp.,
Commercial Mortgage Pass-Through Certificates, Series 1998-CF1, Class [R-I]
[R-II] [R-III], evidencing a ____% Percentage Interest in such Class (the
"Residual Interest Certificates")), a _________________ duly organized and
validly existing under the laws of ____________________, on behalf of which
he/she makes this affidavit. All capitalized terms used but not otherwise
defined herein shall have the respective meanings set forth in the Pooling and
Servicing Agreement pursuant to which the Residual Interest Certificates were
issued (the "Pooling and Servicing Agreement").
2. The Transferee (i) is, and as of the date of transfer will be, a
"Permitted Transferee" and will endeavor to remain a "Permitted Transferee" for
so long as it holds the Residual Interest Certificates, and (ii) is acquiring
the Residual Interest Certificates for its own account or for the account of
another prospective transferee from which it has received an affidavit in
substantially the same form as this affidavit. A "Permitted Transferee" is any
Person other than a "disqualified organization" or a possession of the United
States. (For this purpose, a "disqualified organization" means the United
States, any state or political subdivision thereof, any agency or
instrumentality of any of the foregoing (other than an instrumentality, all of
the activities of which are subject to tax and, except for the Federal Home Loan
Mortgage Corporation, a majority of whose board of directors is not selected by
any such governmental entity) or any foreign government, international
organization or any agency or instrumentality of such foreign government or
organization, any rural electric or telephone cooperative, or any organization
(other than certain farmers' cooperatives) that is generally exempt from federal
income tax (unless such organization is subject to the tax on unrelated business
taxable income).
3. The Transferee is aware (i) of the tax that would be imposed under the
Code on transfers of the Residual Interest Certificates to non-Permitted
Transferees; (ii) that such tax would be on the transferor or, if such transfer
is through an agent (which Person includes a broker, nominee or middleman) for a
non-Permitted Transferee, on the agent; (iii) that the Person otherwise liable
for the tax shall be relieved of liability for the tax if the transferee
furnishes to such Person an affidavit that the transferee is a Permitted
Transferee and, at the time of transfer, such Person does not have actual
knowledge that the affidavit is false; and (iv) that the Residual Interest
Certificates may be a "noneconomic residual interest" within the meaning of
Treasury regulation Section 1.860E- 1(c) and that the transferor of a
"noneconomic residual interest" will remain liable for any taxes due with
respect to the income on such residual interest, unless no significant purpose
of the transfer is to enable the transferor to impede the assessment or
collection of tax.
H-1-1
<PAGE>
4. The Transferee is aware of the tax imposed on a "pass-through entity"
holding the Residual Interest Certificates if at any time during the taxable
year of the pass-through entity a non-Permitted Transferee is the record holder
of an interest in such entity. (For this purpose, a "pass-through entity"
includes a regulated investment company, a real estate investment trust or
common trust fund, a partnership, trust or estate, and certain cooperatives.)
5. The Transferee is aware that the Certificate Registrar will not register
any transfer of the Residual Interest Certificates by the Transferee unless the
Transferee's transferee, or such transferee's agent, delivers to the Certificate
Registrar, among other things, an affidavit and agreement in substantially the
same form as this affidavit and agreement. The Transferee expressly agrees that
it will not consummate any such transfer if it knows or believes that any
representation contained in such affidavit and agreement is false.
6. The Transferee consents to any additional restrictions or arrangements
that shall be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that the Residual Interest Certificates will only be
owned, directly or indirectly, by a Permitted Transferee.
7. The Transferee's taxpayer identification number is _________________.
8. The Transferee has reviewed the provisions of Section 5.02(d) of the
Pooling and Servicing Agreement, a description of which provisions is set forth
in the Residual Interest Certificates (in particular, clause (ii)(A) of Section
5.02(d) which authorizes the Trustee to deliver payments on the Residual
Interest Certificates to a Person other than the Transferee and clause (ii)(B)
of Section 5.02(d) which authorizes the Trustee to negotiate a mandatory
disposition of the Residual Interest Certificates, in either case, in the event
that the Transferee holds such Residual Interest Certificates in violation of
Section 5.02(d)); and the Transferee expressly agrees to be bound by and to
comply with such provisions.
9. No purpose of the Transferee relating to its purchase or any sale of the
Residual Interest Certificates is or will be to impede the assessment or
collection of any tax.
10. The Transferee hereby represents to and for the benefit of the
transferor that the Transferee intends to pay any taxes associated with holding
the Residual Interest Certificates as they become due, fully understanding that
it may incur tax liabilities in excess of any cash flows generated by the
Residual Interest Certificates.
11. The Transferee will, in connection with any transfer that it makes of
the Residual Interest Certificates, deliver to the Certificate Registrar a
representation letter substantially in the form of Exhibit H-2 to the Pooling
and Servicing Agreement in which it will represent and warrant, among other
things, that it is not transferring the Residual Interest Certificates to impede
the assessment or collection of any tax and that it has at the time of such
transfer conducted a reasonable investigation of the financial condition of the
proposed transferee as contemplated by Treasury regulation Section
1.860E-1(c)(4)(i) and has satisfied the requirements of such provision.
12. The Transferee is a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, or an estate
whose income from sources without the United States is includible in gross
income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States, or
a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more United States
persons have the authority to control all substantial decisions of the trust,
all within the meaning of Section 7701(a)(30) of the Code.
H-1-2
<PAGE>
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to the authority of its Board of Directors, by
its ____________________ and its corporate seal to be hereunto attached,
attested by its [Assistant] Secretary, this day of _________, ____.
[NAME OF TRANSFEREE]
By: ________________________________
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
_____________________
[Assistant] Secretary
Personally appeared before me the above-named ____________________, known
or proved to me to be the same person who executed the foregoing instrument and
to be the ____________________ of the Transferee, and acknowledged to me that
he/she executed the same as his/her free act and deed and the free act and deed
of the Transferee
Subscribed and sworn before me this day of _____________________, _____.
____________________________________
NOTARY PUBLIC
COUNTY OF___________________________
STATE OF ___________________________
My Commission expires the _________
day of ___________, 19__.
H-1-3
<PAGE>
EXHIBIT H-2
FORM OF TRANSFEROR CERTIFICATE
FOR TRANSFERS OF RESIDUAL CERTIFICATES
[Date]
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attention: Corporate Trust Services (CMBS)
Re: DLJ Commercial Mortgage Corp., Commercial Mortgage
Pass-Through Certificates, Series 1998-CF1 (the
"Certificates")
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
_________________ (the "Transferor") to _________________ (the "Transferee") of
[Class R-I] [Class R-II] [Class R-III] Certificates evidencing a ____%
Percentage Interest in such Class (the "Residual Interest Certificates"). The
Certificates, including the Residual Interest Certificates, were issued pursuant
to the Pooling and Servicing Agreement, dated as of March 1, 1998 (the "Pooling
and Servicing Agreement"), among DLJ Commercial Mortgage Corp., as depositor,
Banc One Mortgage Capital Markets, LLC, as servicer, Clarion Partners, LLC, as
special servicer, and Norwest Bank Minnesota, National Association, as trustee
and REMIC administrator. All capitalized terms used but not otherwise defined
herein shall have the respective meanings set forth in the Pooling and Servicing
Agreement. The Transferor hereby certifies, represents and warrants to you, as
Certificate Registrar, that:
1. No purpose of the Transferor relating to the transfer of the Residual
Interest Certificates by the Transferor to the Transferee is or will be to
impede the assessment or collection of any tax.
2. The Transferor understands that the Transferee has delivered to you a
Transfer Affidavit and Agreement in the form attached to the Pooling and
Servicing Agreement as Exhibit H-1. The Transferor does not know or believe that
any representation contained therein is false.
H-2-1
<PAGE>
3. The Transferor has at the time of this transfer conducted a reasonable
investigation of the financial condition of the Transferee as contemplated by
Treasury regulation Section 1.860E-1(c)(4)(i) and, as a result of that
investigation, the Transferor has determined that the Transferee has
historically paid its debts as they became due and has found no significant
evidence to indicate that the Transferee will not continue to pay its debts as
they become due in the future. The Transferor understands that the transfer of
the Residual Interest Certificates may not be respected for United States income
tax purposes (and the Transferor may continue to be liable for United States
income taxes associated therewith) unless the Transferor has conducted such an
investigation.
Very truly yours,
____________________________________
(Transferor)
By:_________________________________
Name:_______________________________
Title:______________________________
H-2-2
<PAGE>
EXHIBIT I-1
FORM OF NOTICE AND ACKNOWLEDGMENT
CONCERNING REPLACEMENT OF SPECIAL SERVICER
[Date]
[RATING AGENCIES]
Ladies and Gentlemen:
This notice is being delivered pursuant to Section 6.06 of the Pooling and
Servicing Agreement, dated as of March 1, 1998 and relating to DLJ Commercial
Mortgage Corp., Commercial Mortgage Pass-Through Certificates, Series 1998-CF1
(the "Agreement"). Capitalized terms used but not otherwise defined herein shall
have respective meanings assigned to them in the Agreement.
Notice is hereby given that the Holders of Certificates evidencing a
majority of the Voting Rights allocated to the Controlling Class have designated
________________ to serve as the Special Servicer under the Agreement.
The designation of __________________ as Special Servicer will become final
if certain conditions are met and each Rating Agency delivers to Norwest Bank
Minnesota, National Association, the trustee under the Agreement (the
"Trustee"), written confirmation that if the person designated to become the
Special Servicer were to serve as such, such event would not result in the
qualification, downgrade or withdrawal of the rating or ratings assigned to one
or more Classes of the Certificates. Accordingly, such confirmation is hereby
requested as soon as possible.
I-1-1
<PAGE>
Please acknowledge receipt of this notice by signing the enclosed copy of
this notice where indicated below and returning it to the Trustee, in the
enclosed stamped self-addressed envelope.
Very truly yours,
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Trustee
By:__________________________________
Name:
Title:
Receipt acknowledged:
STANDARD & POOR'S RATINGS SERVICES, A DIVISION
OF THE MCGRAW-HILL COMPANIES, INC.
By:_______________________________
Name:
Title:
Date:
MOODY'S INVESTORS SERVICE, INC.
By:_______________________________
Name:
Title:
Date:
FITCH IBCA, INC.
By:_______________________________
Name:
Title:
Date:
I-1-2
<PAGE>
EXHIBIT I-2
FORM OF ACKNOWLEDGMENT OF PROPOSED SPECIAL SERVICER
[Date]
[TRUSTEE]
[SERVICER]
[DEPOSITOR]
[REMIC ADMINISTRATOR]
Re: DLJ Commercial Mortgage Corp., Series 1998-CF1
Ladies and Gentlemen:
Pursuant to Section 6.06 of the Pooling and Servicing Agreement, dated as
of March 1,1998 and relating to DLJ Commercial Mortgage Corp., Commercial
Mortgage Pass-Through Certificates, Series 1998-CF1 (the "Agreement"), the
undersigned hereby agrees with all the other parties to the Agreement that the
undersigned shall serve as Special Servicer under, and as defined in, the
Agreement. The undersigned hereby acknowledges that, as of the date hereof, it
is and shall be a party to the Agreement and bound thereby to the full extent
indicated therein in the capacity of Special Servicer. The undersigned hereby
makes, as of the date hereof, the representations and warranties set forth in
Section 2.06 of the Agreement, with the following corrections with respect to
type of entity and jurisdiction of organization: ____________________.
____________________________________
By:_________________________________
Name:
Title:
I-2-1
<PAGE>
EXHIBIT J
FORM OF UCC-1 FINANCING STATEMENT
J-1-1
<PAGE>
EXHIBIT 1 to EXHIBIT J
This Exhibit 1 is attached to and incorporated in a financing statement
pertaining to DLJ Commercial Mortgage Corp. as depositor (referred to as the
"Debtor" for the purpose of this financing statement only), and Norwest Bank
Minnesota, National Association as trustee for the holders of the Series
1998-CF1 Certificates (referred to as the "Secured Party" for purposes of this
financing statement only), under that certain Pooling and Servicing Agreement,
dated as of March 1, 1998 (the "Pooling and Servicing Agreement"), among the
Debtor as depositor, the Secured Party as trustee and REMIC administrator, Banc
One Mortgage Capital Markets, LLC as servicer (the "Servicer"), and Clarion
Partners, LLC as special servicer (the "Special Servicer"), relating to the
issuance of the Debtor's Commercial Mortgage Pass-Through Certificates, Series
1998-CF1 (collectively, the "Series 1998-CF1 Certificates"). Capitalized terms
used herein and not defined shall have the respective meanings given to them in
the Pooling and Servicing Agreement. The attached financing statement covers all
of the Debtor's right (including the power to convey title thereto), title and
interest in and to the Trust Fund created pursuant to the Pooling and Servicing
Agreement, consisting of the following:
1. The mortgage notes or other evidence of indebtedness of a borrower
(the "Mortgage Notes") with respect to the mortgage loans (the
"Mortgage Loans") listed on the Mortgage Loan Schedule to the Pooling
and Servicing Agreement, which Mortgage Loan Schedule is attached
hereto as Exhibit B;
2. The related mortgages, deeds of trust or other similar instruments
securing such Mortgage Notes (the "Mortgages");
3. With respect to each Mortgage Note and each Mortgage, each other
legal, credit and servicing document related to such Mortgage Note and
Mortgage (collectively, with such related Mortgage Note and Mortgage,
the "Mortgage Loan Documents");
4. (a) the Collection Account maintained by the Servicer pursuant to the
Pooling and Servicing Agreement, (b) all funds from time to time on
deposit in the Collection Account, (c) the investments of any such
funds consisting of securities, instruments or other obligations, and
(d) the general intangibles consisting of the contractual right to
payment, including, without limitation, the right to payments of
principal and interest and the right to enforce the related payment
obligations, arising from or under any such investments;
5. All REO Property;
6. (a) the REO Account required to be maintained by the Special Servicer
pursuant to the Pooling and Servicing Agreement, (b) all funds from
time to time on deposit in the REO Account, (c) the investments of any
such funds consisting of securities, instruments or other obligations,
and (d) the general intangibles consisting of the contractual right to
payment, including, without limitation, the right to payments of
principal and interest and the right to enforce the related payment
obligations, arising from or under any such investments;
7. (a) the Servicing Account(s) and Reserve Account(s) required to be
maintained by the Servicer or Special Servicer pursuant to the Pooling
and Servicing Agreement, (b) all funds from time to time on deposit in
the Servicing Account(s) and Reserve Account(s), (c) the investments
of any such
J-1-2
<PAGE>
funds consisting of securities, instruments or other obligations, and
(d) the general intangibles consisting of the contractual right to
payment, including, without limitation, the right to payments of
principal and interest and the right to enforce the related payment
obligations, arising from or under any such investments;
8. (a) the Distribution Account required to be maintained by the Secured
Party pursuant to the Pooling and Servicing Agreement, (b) all funds
from time to time on deposit in the Distribution Account, (c) the
investments of any such funds consisting of securities, instruments or
other obligations, and (d) the general intangibles consisting of the
contractual right to payment, including, without limitation, the right
to payments of principal and interest and the right to enforce the
related payment obligations, arising from or under any such
investments;
9. All insurance policies, including the right to payments thereunder,
with respect to the Mortgage Loans required to be maintained pursuant
to the Mortgage Loan Documents and the Pooling and Servicing
Agreement, transferred to the Trust and to be serviced by the Servicer
or Special Servicer; and
10. The rights of the Debtor under Sections 2, 3(a), 3(b), 3(d), 4 and
8(f) (and, to the extent related to the foregoing, under Sections 9,
10, 12, 13, 14, 15, 16, 17 and 19) of the Mortgage Loan Purchase and
Sale Agreement dated as of February 20, 1998, between the Debtor and
Column Financial, Inc.
11. Any rights of the Debtor, as assignee, under the Third Party
Originator Agreements; and
12. All income, payments, products and proceeds of any of the foregoing,
together with any additions thereto or substitutions therefor.
THE DEBTOR AND THE SECURED PARTY INTEND THE TRANSACTIONS CONTEMPLATED BY THE
POOLING AND SERVICING AGREEMENT TO CONSTITUTE A SALE OF THE INTEREST IN THE
MORTGAGE NOTES, THE RELATED MORTGAGES AND THE OTHER MORTGAGE LOAN DOCUMENTS, AND
THIS FILING SHOULD NOT BE CONSTRUED AS A CONCLUSION THAT A SALE HAS NOT
OCCURRED. THE REFERENCES HEREIN TO MORTGAGE NOTES SHOULD NOT BE CONSTRUED AS A
CONCLUSION THAT ANY MORTGAGE NOTE IS NOT AN INSTRUMENT WITHIN THE MEANING OF THE
UNIFORM COMMERCIAL CODE OR THAT A FILING IS NECESSARY TO PERFECT THE OWNERSHIP
OR SECURITY INTEREST OF THE SECURED PARTY IN ANY MORTGAGE NOTE, MORTGAGE OR
OTHER MORTGAGE LOAN DOCUMENT. IN ADDITION, THE REFERENCES HEREIN TO SECURITIES,
INSTRUMENTS AND OTHER OBLIGATIONS (INCLUDING WITHOUT LIMITATION, PERMITTED
INVESTMENTS) SHOULD NOT BE CONSTRUED AS A CONCLUSION THAT ANY SUCH SECURITY,
INSTRUMENT OR OTHER OBLIGATION (INCLUDING WITHOUT LIMITATION, ANY PERMITTED
INVESTMENT) IS NOT AN INSTRUMENT, A CERTIFICATED SECURITY OR AN UNCERTIFICATED
SECURITY WITHIN THE MEANING OF THE UNIFORM COMMERCIAL CODE, AS IN EFFECT IN ANY
APPLICABLE JURISDICTION, NOR SHOULD THIS FINANCING STATEMENT BE CONSTRUED AS A
CONCLUSION THAT A FILING IS NECESSARY TO PERFECT THE OWNERSHIP OR SECURITY
INTEREST OF THE SECURED PARTY IN THE CONTRACTUAL RIGHT TO PAYMENT, INCLUDING,
WITHOUT LIMITATION, THE RIGHT TO PAYMENTS OF PRINCIPAL AND INTEREST AND THE
RIGHT TO ENFORCE THE RELATED PAYMENT OBLIGATIONS, ARISING FROM OR UNDER ANY SUCH
SECURITY, INSTRUMENT OR OTHER OBLIGATION (INCLUDING,
J-1-3
<PAGE>
WITHOUT LIMITATION, ANY PERMITTED INVESTMENT). WITH RESPECT TO THE
FOREGOING, THIS FILING IS MADE ONLY IN THE EVENT OF CONTRARY ASSERTIONS
BY THIRD PARTIES.
J-1-4
<PAGE>
EXHIBIT K
CALCULATION OF NET OPERATING INCOME
With respect to any Mortgaged Property, "Net Operating Income" shall mean
for each fiscal year or portion thereof, (i) the related Operating Income
allocable to such period, less (ii) the related Operating Expenses allocable to
such period, and less (iii) any Contractual Recurring Replacement Reserve for
such Mortgaged Property as indicated in the Prospectus Supplement dated February
___, 1998 relating to DLJ Commercial Mortgage Corp., Commercial Mortgage
Pass-Through Certificates, Series 1998-CF1 (the amounts described in this clause
(iii) to be prorated if "Net Operating Income" is being calculated for less than
a full fiscal year).
With respect to any Mortgaged Property "Operating Income" shall mean, for
each fiscal year or portion thereof, all revenue derived by the related
Mortgagor arising from the Mortgaged Property, including, without limitation,
rental revenues (whether denominated as basic rent, additional rent, percentage
rent, escalation payments, electrical payments or otherwise) and other fees and
charges payable pursuant to leases or otherwise in connection with the Mortgaged
Property, and rent insurance proceeds. Operating Income shall not include (a)
insurance proceeds (other than proceeds of business interruption or other
similar insurance allocable to the applicable period) and condemnation awards
(other than awards arising from a temporary taking or the use and occupancy of
all or part of the applicable Mortgaged Property allocable to the applicable
period), or interest accrued on such proceeds or awards, (b) proceeds of any
financing, (c) proceeds of any sale, exchange or transfer of the Mortgaged
Property or any part thereof or interest therein, (d) capital contributions or
loans to the Mortgagor or an Affiliate of the Mortgagor, (e) any item of income
otherwise includible in Operating Income but paid directly by any tenant to a
Person other than the Mortgagor except for real estate taxes paid directly to
any taxing authority by any tenant, (f) any other extraordinary, non-recurring
revenues, (g) rent paid by or on behalf of any lessee under space lease which is
the subject of any proceeding or action relating to its bankruptcy,
reorganization or other arrangement pursuant to federal bankruptcy law or any
similar federal or state law or which has been adjudicated a bankrupt or
insolvent, unless such space lease has been affirmed by the trustee in such
proceeding or action, or (h) rent paid by or on behalf of any lessee under a
space lease the demised premises of which are not occupied either by such lessee
or by a sublessee thereof.
With respect to any Mortgaged Property "Operating Expenses" shall mean, for
each fiscal year or portion thereof, all expenses directly attributable to the
operation, repair and/or maintenance of the Mortgaged Property, including,
without limitation, impositions, insurance premiums, management fees, payments
to third party suppliers, and costs attributable to the operation, repair and
maintenance of the systems for heating, ventilating and air conditioning, and
actually paid for by the Mortgagor. Operating Expenses shall not include
interest, principal and premium, if any, due under the Mortgage Note or
otherwise in connection with any other secured indebtedness, income taxes,
extraordinary capital improvements costs, or any non-cash charge or expense such
as depreciation.
K-1
<PAGE>
EXHIBIT L-1
FORM OF CERTIFICATE WITH RESPECT TO INFORMATION
REQUEST BY BENEFICIAL HOLDER
[Date]
Norwest Bank Minnesota, National Association
Three New York Plaza
New York, New York 10004
Attention: Corporate Trust Services (CMBS)
Re: DLJ Commercial Mortgage Corp., Series 1998-CF1
In accordance with Section 8.12(b) of the Pooling and Servicing Agreement,
dated as of March 1, 1998 (the "Pooling and Servicing Agreement"), among DLJ
Commercial Mortgage Corp. as depositor (the "Depositor"), Banc One Mortgage
Capital Markets, LLC, as servicer, Clarion Partners, LLC, as special servicer,
and Norwest Bank Minnesota, National Association as trustee (in such capacity,
the "Trustee") and REMIC administrator, with respect to the DLJ Commercial
Mortgage Corp. Commercial Mortgage Pass-Through Certificates, Series 1998-CF1
(the "Certificates"), the undersigned hereby certifies and agrees as follows:
1. The undersigned is a beneficial owner of the Class ____ Certificates.
2. The undersigned is requesting the information identified on the
schedule attached hereto pursuant to Section 8.12(b) of the Pooling
and Servicing Agreement (the "Information").
3. In consideration of the Trustee's disclosure to the undersigned of the
Information, the undersigned will keep the Information confidential
(except from such outside persons as are assisting it in making the
evaluation described in paragraph 2), and such Information will not,
without the prior written consent of the Trustee, be disclosed by the
undersigned or by its officers, directors, partners employees, agents
or representatives (collectively, the "Representatives") in any manner
whatsoever, in whole or in part; provided that the undersigned may
provide all or any part of the Information to any other person or
entity that holds or is contemplating the purchase of any Certificate
or interest therein, but only if such person or entity confirms in
writing such ownership interest or prospective ownership interest and
agrees to keep it confidential.
4. The undersigned will not use or disclose the Information in any manner
which could result in a violation of any provision of the Securities
Act of 1933, as amended (the "Securities Act"), or the Securities
Exchange Act of 1934, as amended, or would require registration of any
Certificate pursuant to Section 5 of the Securities Act.
5. The undersigned shall be fully liable for any breach of this agreement
by itself or any of its Representatives and shall indemnify the
Depositor, the Trustee
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and the Trust for any loss, liability or expense incurred thereby with
respect to any such breach by the undersigned or any of its
Representatives.
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IN WITNESS WHEREOF, the undersigned has caused its name to be signed hereto
by its duly authorized officer, as of the day and year written above.
[BENEFICIAL HOLDER OF A
CERTIFICATE]
By:_________________________________
Name:
Title:
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EXHIBIT L-2
FORM OF CERTIFICATE WITH RESPECT TO INFORMATION
REQUEST BY PROSPECTIVE PURCHASER
[Date]
[TRUSTEE]
Re: DLJ Commercial Mortgage Corp., Commercial Mortgage Pass-Through
Certificates, Series 1998-CF1 (the "Certificates")
In accordance with Section 8.12(b) of the Pooling and Servicing Agreement,
dated as of February __, 1998 (the "Pooling and Servicing Agreement"), among DLJ
Commercial Mortgage Corp. as depositor (the "Depositor"), Banc One Mortgage
Capital Markets, LLC, as servicer, Clarion Partners, LLC, as special servicer,
and Norwest Bank Minnesota, National Association as trustee (in such capacity,
the "Trustee") and REMIC administrator, with respect to the DLJ Commercial
Mortgage Corp. Commercial Mortgage Pass-Through Certificates, Series 1998-CF1
(the "Certificates"), the undersigned hereby certifies and agrees as follows:
1. The undersigned is contemplating an investment in the Class ____
Certificates.
2. The undersigned is requesting the information identified on the
schedule attached hereto pursuant to Section 8.12(b) of the
Pooling and Servicing Agreement (the "Information") for use in
evaluating such possible investment.
3. In consideration of the Trustee's disclosure to the undersigned
of the Information, the undersigned will keep the Information
confidential (except from such outside persons as are assisting
it in making the investment decision described in paragraphs 1
and 2), and such Information will not, without the prior written
consent of the Trustee, be disclosed by the undersigned or by its
officers, directors, partners employees, agents or
representatives (collectively, the "Representatives") in any
manner whatsoever, in whole or in part.
4. The undersigned will not use or disclose the Information in any
manner which could result in a violation of any provision of the
Securities Act of 1933, as amended (the "Securities Act"), or the
Securities Exchange Act of 1934, as amended, or would require
registration of any Certificate pursuant to Section 5 of the
Securities Act.
5. The undersigned shall be fully liable for any breach of this
agreement by itself or any of its Representatives and shall
indemnify the Depositor, the Trustee and the Trust for any loss,
liability or expense incurred thereby with respect to any such
breach by the undersigned or any of its Representatives.
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<PAGE>
IN WITNESS WHEREOF, the undersigned has caused its name to be signed hereto
by its duly authorized officer, as of the day and year written above.
[PROSPECTIVE PURCHASER]
By:_________________________________
Name:
Title:
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EXHIBIT M
FORM OF MORTGAGE LOAN PURCHASE AND SALE AGREEMENT
M-1
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MORTGAGE LOAN PURCHASE AND SALE AGREEMENT
This Mortgage Loan Purchase and Sale Agreement, dated as of February 20,
1998 (this "Agreement"), is between DLJ Commercial Mortgage Corp., a Delaware
corporation (the "Purchaser"), and Column Financial, Inc., a Delaware
corporation (the "Seller").
The Seller intends to sell, assign, transfer, set over and otherwise convey
to the Purchaser, subject to the terms and conditions set forth below, certain
mortgage loans (collectively, the "Mortgage Loans") identified and more
particularly described on Schedule 1 attached hereto (the "Mortgage Loan
Schedule"). Unless otherwise indicated on the Mortgage Loan Schedule, the
Mortgage Loans were originated by the Seller. With respect to those Mortgage
Loans, if any, identified on the Mortgage Loan Schedule as having been
originated by a party other than the Seller (any such other party, a "Third
Party Originator"; and any such Mortgage Loan, a "Third Party Mortgage Loan"),
the Seller is the beneficiary, either directly or by way of assignment, of
certain representations and warranties made by the Third Party Originator(s)
with respect to its (their) respective Third Party Mortgage Loan(s) pursuant to
the agreement(s) identified on Schedule 2 hereto (each agreement so identified,
a "Third Party Originator Agreement"). The Seller also intends to assign to the
Purchaser all of its right, title and interest in, to and under each Third Party
Originator Agreement, as and to the extent set forth in Section 2 below.
Reference is made to the Pooling and Servicing Agreement, dated as of March
1, 1998 (the "Pooling and Servicing Agreement"), among the Purchaser, as
depositor, BancOne Mortgage Capital Markets, LLC, as servicer (in such capacity,
the "Servicer"), Clarion Partners, LLC, as special servicer (in such capacity,
the "Special Servicer"), and Norwest Bank Minnesota, N.A. as trustee (in such
capacity, the "Trustee") and as REMIC administrator (in such capacity, the
"REMIC Administrator"), relating to the issuance of the Purchaser's Commercial
Mortgage Pass-Through Certificates, Series 1998-CF1 (the "Certificates").
Capitalized terms used without definition herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement as in full
force and effect on the Closing Date (as defined below). The Seller acknowledges
that the Purchaser intends to transfer the Mortgage Loans to the Trustee in
exchange for the Certificates. The Purchaser has entered into an Underwriting
Agreement, dated the date hereof (the "Underwriting Agreement"), with Donaldson,
Lufkin & Jenrette Securities Corporation (the "Underwriter"), whereby the
Purchaser will sell to the Underwriter all of the Certificates that are to be
registered under the Securities Act of 1933, as amended (the "Securities Act";
and such Certificates, the "Registered Certificates"). The Purchaser has also
entered into a Certificate Purchase Agreement, dated the date hereof (the
"Certificate Purchase Agreement"), with the Underwriter, whereby the Purchaser
will sell to the Underwriter all of the remaining Certificates (the
"Non-Registered Certificates").
1. Agreement to Purchase. The Seller agrees to sell, assign,
transfer, set over and otherwise convey, and the Purchaser agrees to purchase,
the Mortgage Loans. The purchase and sale of the Mortgage Loans shall take place
on March 2, 1998 or such other date as shall be mutually acceptable to the
parties hereto (the "Closing Date"). The Mortgage Loans will have an
<PAGE>
aggregate Cut-off Date Balance of approximately $838,800,140 (the "Initial Pool
Balance"). The purchase price for the Mortgage Loans shall be equal to 100% of
the Initial Pool Balance plus accrued interest thereon at the weighted average
of the Net Mortgage Rates for the Mortgage Loans from March 1, 1998 (the
"Cut-off Date") to but not including the Closing Date, and such purchase price
shall be paid to the Seller on the Closing Date by wire transfer in immediately
available funds or by such other method as shall be mutually acceptable to the
parties hereto.
2. Conveyance of the Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of the
purchase price referred to in Section 1 above, the Seller does hereby sell,
assign, transfer, set over and otherwise convey to the Purchaser all the
Seller's right, title and interest in and to the Mortgage Loans, including all
interest and principal received on or with respect to the Mortgage Loans after
the Cut-off Date (other than scheduled payments of interest and principal due on
or before the Cut-off Date), together with all of the Seller's right, title and
interest in and to the proceeds of any related title, hazard or other insurance
policies and any escrow, reserve or other comparable accounts related to the
Mortgage Loans, and all of the Seller's right, title and interest in, to and
under the Third Party Originator Agreements; provided, however, that the
Seller's rights under the Third Party Originator Agreements, as assignee, and
the rights the Seller is conveying hereunder, do not include any rights of its
assignor to indemnification under Section 4 of each of such agreements. On the
Closing Date, the Seller shall transfer or cause to be transferred to the
Servicer the funds in such escrow, reserve or other comparable accounts related
to the Mortgage Loans, together with an amount equal to all collections on the
Mortgage Loans received prior to the Closing Date that represent scheduled
payments of principal and interest due and principal prepayments received after
the Cut-off Date.
(b) In connection with such transfer and assignment, the Purchaser hereby
directs the Seller to, and the Seller hereby agrees to, deliver to, and deposit
with, the Trustee (or a custodian appointed thereby (a "Custodian")) the
documents and/or instruments described on Exhibit A hereto with respect to each
Mortgage Loan (collectively as to each Mortgage Loan, the "Mortgage File");
provided that if all or any portion of the Mortgage File for any Mortgage Loan
is held as of the Closing Date by an Independent third party (an "Independent
Bailee"), the Seller may, in lieu of so delivering to the Trustee or a Custodian
appointed thereby the portion of such Mortgage File so held by an Independent
Bailee, deliver to the Trustee or a Custodian appointed thereby on or before the
Closing Date a trust receipt or comparable instrument (a "Trust Receipt") that
unconditionally entitles the bearer thereof (and only the bearer thereof) to
claim without payment of any outstanding debts, the portion of such Mortgage
File so held by an Independent Bailee (which the Trustee is required to do
promptly (and, in any event, within 15 days) following the Closing Date at the
expense and with the cooperation of the Seller). It shall be a breach of this
Section 2(b) if the Trustee or its designee is unable, upon properly submitting
any Trust Receipt to the applicable Independent Bailee, to promptly obtain the
portion of the Mortgage File purportedly covered by such Trust Receipt. In
addition, the Purchaser hereby directs the Seller to, and the Seller hereby
agrees to, deliver to, and deposit with, the Servicer all of the documents and
other items referred to in Section 2.01(f) of the Pooling and Servicing
Agreement with respect
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to the Mortgage Loans (collectively as to each Mortgage Loan, the "Servicing
File"), together with any and all unapplied escrows and reserves in respect of
the Mortgage Loans.
If the Seller cannot deliver on the Closing Date any original or certified
recorded document described on Exhibit A that is not covered by a Trust Receipt,
the Seller shall use its best efforts, promptly upon receipt thereof, to deliver
such original or certified recorded documents to the Trustee or Custodian, as
the case may be (unless the Seller is delayed in making such delivery by reason
of the fact that such documents shall not have been returned by the appropriate
recording office in which case it shall notify the Trustee and, if applicable,
the Custodian in writing of such delay and shall deliver such documents to the
Trustee or Custodian, as the case may be, promptly upon the Seller's receipt
thereof).
3. Representations and Warranties.
(a) The Seller hereby makes, as of the Closing Date, to and for the benefit
of the Purchaser and its successors and assigns (including, without limitation,
the Trustee for the benefit of the Certificateholders), each of the
representations and warranties set forth in Exhibit B.
(b) The Seller hereby makes, as of the Closing Date (or as of such other
date specifically provided in the particular representation or warranty), to and
for the benefit of the Purchaser and its successors and assigns (including,
without limitation, the Trustee for the benefit of the Certificateholders), each
of the representations and warranties set forth in Exhibit C.
(c) The Seller hereby represents and warrants, as of the Closing Date, to
and for the benefit of the Purchaser only, that the Seller has not dealt with
any broker, investment banker, agent or other person (other than the Purchaser
and the Underwriter) who may be entitled to any commission or compensation in
connection with the sale to the Purchaser of the Mortgage Loans.
(d) The Seller hereby agrees that it shall be deemed to make to and for the
benefit of the Purchaser and its successors and assigns (including, without
limitation, the Trustee for the benefit of the Certificateholders), as of the
date of substitution, with respect to any replacement mortgage loan (a
"Replacement Mortgage Loan") that is substituted for a Defective Mortgage Loan
(as defined in Section 4(a) hereof), whether by the Seller pursuant to Section
4(a) or by a Third Party Originator pursuant to the related Third Party
Originator Agreement, each of the representations and warranties set forth in
Exhibit B and Exhibit C (other than, in the case of a Replacement Mortgage Loan
substituted by a Third Party Originator, the representations and warranties set
forth in Paragraph (d) of Exhibit B and Paragraph 2 of Exhibit C). From and
after the date of substitution, each Replacement Mortgage Loan, if any, shall be
deemed to constitute a "Mortgage Loan" hereunder for all purposes.
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4. Notice of Breach; Cure, Repurchase and Substitution.
(a) Within ninety (90) days of the earlier of discovery or receipt of
notice by the Seller that there has been a breach of any of the representations
and warranties set forth in Exhibit B or Exhibit C and made by the Seller
pursuant to Section 3(a), Section 3(b) or Section 3(d), as the case may be,
which breach materially and adversely affects the value of any Mortgage Loan or
the interests of the legal and/or beneficial owner(s) thereof (any such breach,
a "Material Breach"), the Seller shall, subject to subsection (b) below, (i)
cure such Material Breach in all material respects or (ii) repurchase each
affected Mortgage Loan (each, a "Defective Mortgage Loan") at the related
Purchase Price in accordance with the directions of the owner(s) of such
Defective Mortgage Loan(s); provided that if (i) such Material Breach does not
relate to whether the Defective Mortgage Loan is a "qualified mortgage" within
the meaning of Section 860G(a)(3) of the Code (a "Qualified Mortgage"), (ii)
such Material Breach is capable of being cured but not within such 90-day
period, (iii) the Seller has commenced and is diligently proceeding with the
cure of such Material Breach within such 90-day period, and (iv) the Seller
shall have delivered to the owner(s) of the Defective Mortgage Loan a
certification executed on behalf of the Seller by an officer thereof setting
forth the reason that such Material Breach is not capable of being cured within
the initial 90-day period and what actions the Seller is pursuing in connection
with the cure thereof and stating that the Seller anticipates that such Material
Breach will be cured within an additional period not to exceed 90 more days,
then the Seller (except with respect to Third Party Mortgage Loans as provided
in Section 4(b)) shall have up to an additional 90 days to complete such cure;
and provided, further, that if the Seller's obligation to repurchase any
Defective Mortgage Loan as a result of a Material Breach arises within the
three-month period commencing on the Closing Date (or within the two-year period
commencing on the Closing Date if the Defective Mortgage Loan is a "defective
obligation" within the meaning of Section 860G(a)(4)(B)(ii) of the Code and
Treasury Regulation Section 1.860G-2(f)), the Seller may, at its option, in lieu
of repurchasing such Defective Mortgage Loan (but, in any event, no later than
such repurchase would have to have been completed), (a) replace such Defective
Mortgage Loan with one or more substitute mortgage loans that individually and
collectively satisfy the requirements of the definition of "Qualifying
Substitute Mortgage Loan" set forth in the Pooling and Servicing Agreement, and
(b) pay any corresponding Substitution Shortfall Amount, such substitution and
payment to be effected in accordance with the terms of the Pooling and Servicing
Agreement (or, if the Defective Mortgage Loan is no longer subject thereto, in
accordance with the reasonable instructions of the owner(s) thereof). Any such
repurchase or replacement of a Defective Mortgage Loan shall be on a whole loan,
servicing released basis.
Whenever one or more mortgage loans are substituted for a Defective
Mortgage Loan as contemplated by this Section 4(a), the Seller (i) shall deliver
the related Mortgage File to the owner(s) of the Defective Mortgage Loan, (ii)
certify that such substitute mortgage loan satisfies or such substitute mortgage
loans satisfy, as the case may be, all of the requirements of the definition of
"Qualifying Substitute Mortgage Loan" set forth in the Pooling and Servicing
Agreement and (iii) send such certification to such owner(s). No mortgage loan
may be substituted for a Defective Mortgage Loan as contemplated by this Section
4(a) if the Defective Mortgage Loan to be replaced was itself a Replacement
Mortgage Loan. Monthly Payments due
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with respect to each Replacement Mortgage Loan (if any) after the related date
of substitution, and Monthly Payments due with respect to each Defective
Mortgage Loan (if any) after the Cut-off Date and on or prior to the related
date of repurchase or substitution, shall belong to the Purchaser and its
successors and assigns. Monthly Payments due with respect to each Replacement
Mortgage Loan (if any) on or prior to the related date of substitution, and
Monthly Payments due with respect to each Defective Mortgage Loan (if any) after
the related date of repurchase or substitution, shall belong to the Seller (or,
in the case of a Defective Mortgage Loan that is repurchased or replaced by a
Third Party Originator, to such Third Party Originator).
If any Defective Mortgage Loan is to be repurchased or replaced as
contemplated by this Section 4(a), the Seller shall amend the Mortgage Loan
Schedule to reflect the removal of the Defective Mortgage Loan and, if
applicable, the substitution of the related Replacement Mortgage Loan(s) and
shall forward such amended schedule to the owner(s) of such Defective Mortgage
Loan.
It is understood and agreed that the obligations of the Seller set forth in
this Section 4(a) to cure a Material Breach or repurchase or replace the related
Defective Mortgage Loan(s), and the obligations of the Seller in respect of
indemnification and contribution set forth in Section 8, constitute the sole
remedies available to the Purchaser or any assignee respecting a breach of the
representations and warranties set forth on Exhibits B and C and made by the
Seller pursuant to Sections 3(a), 3(b) and 3(d), respectively.
(b) It is hereby acknowledged that with respect to the Third Party Mortgage
Loans, if any, the rights of the Seller in respect of those certain
representations and warranties made by the Third Party Originators pursuant to
the Third Party Originator Agreements and assigned by the Seller to the
Purchaser pursuant hereto will, in turn, be assigned by the Purchaser to the
Trustee, as trustee under the Pooling and Servicing Agreement, for the benefit
of the Certificateholders. Accordingly, it is hereby agreed that if, in respect
of any such Third Party Mortgage Loan, there exists a breach of any of the
related Third Party Originator's representations and warranties for which such
Third Party Originator could be required to repurchase or (at its option, to the
extent of its substitution rights and subject to the Seller's right to approve
any Replacement Mortgage Loan delivered thereunder) replace such Third Party
Mortgage Loan, then notwithstanding that such Third Party Mortgage Loan may also
constitute a Defective Mortgage Loan for purposes of Section 4(a) by reason of a
Material Breach of any of the Seller's representations and warranties set forth
in Exhibits B and C made pursuant to Sections 3(a), 3(b) and 3(d), respectively,
the Seller shall be deemed not to have notice of such Material Breach (and,
correspondingly, not to be obligated to proceed with the cure of such Material
Breach or the repurchase of or substitution for such Third Party Mortgage Loan)
unless and until the related Third Party Originator shall have failed to cure
such Material Breach or repurchase or replace such Third Party Mortgage Loan
during the cure period for the breach of its representations and warranties set
forth in the related Third Party Originator Agreement; provided that this
sentence shall not apply in the event of a Material Breach that relates to
whether the Defective Mortgage Loan is a Qualified Mortgage. The foregoing
notwithstanding, if, as a result of the failure of a Third Party Originator to
cure a Material Breach with respect to a Third Party Mortgage Loan or repurchase
or replace such Third
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Party Mortgage Loan during the applicable cure period, the Seller is obligated
to cure such Material Breach or repurchase or replace such Third Party Mortgage
Loan, the Seller shall not be entitled to the additional 90-day cure period that
is provided for in Section 4(a) with respect to Mortgage Loans that are not
Third Party Mortgage Loans. In addition, if the price at which any Third Party
Mortgage Loan is required to be repurchased by the related Third Party
Originator, or the additional cash amount to be paid together with the delivery
of one or more Replacement Mortgage Loans substituted by the related Third Party
Originator for any Third Party Mortgage Loan, in either case in connection with
a breach of such Third Party Originator's representations and warranties as
contemplated above, is less than the applicable Purchase Price or Substitution
Shortfall Amount, as the case may be, the Seller shall make-up the difference
out of its own funds (payment of such difference to be made in accordance with
the directions of the owner(s) of such Third Party Mortgage Loan at the time it
is repurchased or replaced by such Third Party Originator).
(c) It shall be a condition to any repurchase of or substitution for a
Defective Mortgage Loan by the Seller pursuant to Section 4(a) that the Trustee
as assignee of the Purchaser shall have executed and delivered such instruments
of transfer or assignment then presented to it by the Seller, in each case
without recourse, as shall be necessary to vest in the Seller (i) the legal and
beneficial ownership of such Defective Mortgage Loan (including any property
acquired in respect thereof or proceeds of any insurance policy with respect
thereto), to the extent that such ownership interest was transferred to the
Trustee under the Pooling and Servicing Agreement, and (ii) in the case of a
Third Party Mortgage Loan, the rights in respect of such Third Party Mortgage
Loan under the related Third Party Originator Agreement that were assigned to
the Trustee under the Pooling and Servicing Agreement.
(d) The Seller hereby acknowledges and consents to the assignment by the
Purchaser to the Trustee, as trustee under the Pooling and Servicing Agreement,
for the benefit of the Certificateholders, of (i) the representations and
warranties set forth in Exhibits B and C and made by the Seller pursuant to
Sections 3(a), 3(b) and 3(d), respectively, (ii) the obligation of the Seller to
repurchase or replace a Defective Mortgage Loan in connection with a Material
Breach pursuant to Section 4(a) and (iii) the obligation of the Seller to
deliver certain documentation, funds and other assets relating to the Mortgage
Loans pursuant to Section 2. The Trustee or its designee may enforce such
obligations as provided in Section 11(a) hereof or as assignee.
5. Closing. The closing of the sale of the Mortgage Loans (the "Closing")
shall be held at the offices of Sidley & Austin, 875 Third Avenue, New York, New
York 10022 at 10:00 a.m., New York City time (or at such other place and time as
may be determined by the Purchaser), on the Closing Date.
The Closing shall be subject to each of the following conditions:
(i) All of the representations and warranties of the Seller made
pursuant to Section 3 of this Agreement shall be true and correct as of the
Closing Date;
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(ii) All documents specified in Section 6 of this Agreement (the
"Closing Documents"), in such forms as are agreed upon and acceptable to
the Purchaser, shall be duly executed and delivered by all signatories as
required pursuant to the respective terms thereof;
(iii) The Seller shall have delivered and released to the Trustee or a
Custodian and to the Servicer, respectively, all documents, funds and other
assets required to be delivered thereto pursuant to Section 2 of this
Agreement;
(iv) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with,
and the Seller shall have the ability to comply with all terms and
conditions and perform all duties and obligations required to be complied
with or performed after the Closing Date; and
(v) The Seller shall have paid all fees and expenses payable by it to
the Purchaser or otherwise pursuant to this Agreement.
Both parties agree to use their best efforts to perform their respective
obligations hereunder in a manner that will enable the Purchaser to purchase the
Mortgage Loans on the Closing Date.
6. Closing Documents. The Closing Documents shall consist of the following:
(i) This Agreement duly executed by the Purchaser and the Seller;
(ii) An Officer's Certificate substantially in the form of Exhibit D-1
hereto, executed by an executive officer of the Seller, in his or her
individual capacity, and dated the Closing Date, and upon which the
Purchaser, the Underwriter, their affiliates, the Trustee and the
Certificateholders (collectively, for purposes of this Section 6, the
"Interested Parties") may rely, attaching thereto as exhibits (A) the
resolutions of the board of directors of the Seller authorizing the
Seller's entering into the transactions contemplated by this Agreement and
(B) the certificate of incorporation and by-laws of the Seller;
(iii) A certificate of good standing of the Seller issued by the
Secretary of State of the State of Delaware not earlier than thirty (30)
days prior to the Closing Date, and upon which the Interested Parties may
rely;
(iv) A Certificate of the Seller substantially in the form of Exhibit
D-2 hereto, executed by an executive officer of the Seller and dated the
Closing Date, and upon which the Interested Parties may rely;
(v) A written opinion of Long Aldridge & Norman, counsel for the
Seller, substantially in the form of Exhibit D-3 hereto, with any
modifications required by any rating agency (each, a "Rating Agency")
identified in the Prospectus Supplement or the
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Memorandum (each as defined below), dated the Closing Date and addressed to
the Purchaser, the Underwriter, the Trustee and, if requested thereby, each
Rating Agency, together with such other written opinions as may be required
by any Rating Agency; and
(vi) Such further certificates, opinions and documents as the
Purchaser may reasonably request.
7. Costs. The Seller shall pay all expenses incidental to the performance
of its obligations under this Agreement, including without limitation, any
recording fees or fees for title policy endorsements and continuations and fees
and expenses of its counsel.
8. Indemnification.
(a) The Seller shall indemnify and hold harmless the Purchaser, the
Underwriter, their respective officers and directors, and each person, if any,
who controls the Purchaser or the Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Securities Exchange Act of
1934, as amended (the "Exchange Act") (the Purchaser, the Underwriter, their
respective officers and directors and any such controlling persons,
collectively, for purposes of this Section 8, the "Indemnified Parties"),
against any and all losses, claims, damages or liabilities, joint or several, to
which they or any of them may become subject under the Securities Act, the
Exchange Act or other federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) (i) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in (A) the
Prospectus Supplement, the Memorandum or, insofar as they are required to be
filed as part of the Registration Statement pursuant to the No-Action Letters,
any Computational Materials or ABS Term Sheets with respect to the Registered
Certificates, or in any revision or amendment of or supplement to any of the
foregoing or (B) any items similar to Computational Materials and ABS Term
Sheets forwarded to prospective investors in the Non-Registered Certificates, or
(ii) arise out of or are based upon 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; but only if and to the extent that such untrue statement,
alleged untrue statement, omission or alleged omission was made in reliance upon
any information furnished to any Indemnified Party by or on behalf of the Seller
or approved by the Seller, or upon a defective document delivered to the
Purchaser by or on behalf of the Seller (other than in respect of a Third Party
Mortgage Loan) or upon any breach or alleged breach of any of the
representations, warranties, covenants or agreements of the Seller (other than
those relating to the Third Party Mortgage Loans) as set forth in or made
pursuant to this Agreement or any exhibit hereto (collectively, the "Seller's
Information"). Without limiting the intended coverage of the foregoing
indemnity, it is hereby acknowledged that all statements (other than those
relating to the Third Party Mortgage Loans) set forth in [each of the Prospectus
Supplement and the Memorandum under the caption "Description of the Mortgage
Pool" or elsewhere in the Prospectus Supplement and the Memorandum with respect
to the subjects discussed under such caption in each] and all statements (other
than those relating to the Third Party Mortgage Loans) set forth on Exhibits A-1
and A-2
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<PAGE>
to the Prospectus Supplement, have been made in reliance upon information
furnished by or on behalf of the Seller or approved by the Seller. The Seller
acknowledges that the Underwriter will enter into the Underwriting Agreement and
the Certificate Purchase Agreement in reliance upon this indemnity agreement of
the Seller. This indemnity agreement will be in addition to any liability which
the Seller may otherwise have.
For purposes of this Agreement, "Registration Statement" shall mean the
registration statement No. 333-32019 filed by the Purchaser on Form S-3,
including, without limitation, all exhibits thereto and information incorporated
therein by reference; "Prospectus" shall mean the prospectus dated February 17,
1998, as supplemented by the prospectus supplement dated February 20, 1998 (the
"Prospectus Supplement"), relating to the Registered Certificates, including,
without limitation, all annexes and exhibits thereto; "Memorandum" shall mean
the private placement memorandum dated February 20, 1998, relating to the
Non-Registered Certificates, including, without limitation, all annexes and
exhibits thereto; "Computational Materials" shall have the meaning assigned
thereto in the no-action letter dated May 20, 1994 issued by the Division of
Corporation Finance of the Securities and Exchange Commission (the "Commission")
to Kidder, Peabody Acceptance Corporation I, Kidder, Peabody & Co. Incorporated,
and Kidder Structured Asset Corporation and the no-action letter dated May 27,
1994 issued by the Division of Corporation Finance of the Commission to the
Public Securities Association (together, the "Kidder Letters"); "ABS Term
Sheets" shall have the meaning assigned thereto in the no-action letter dated
February 17, 1995 issued by the Division of Corporation Finance of the
Commission to the Public Securities Association (the "PSA Letter" and, together
with the Kidder letters, the "No-Action Letters").
(b) In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to subsection (a) above, the Indemnified Party shall promptly notify
the Seller in writing and the Seller, upon request of the Indemnified Party,
shall retain counsel reasonably satisfactory to the Indemnified Party to
represent the Indemnified Party and any others the Seller may designate in such
proceeding and shall pay the reasonable fees and disbursements of such counsel
relating to such proceeding. In any such proceeding, any Indemnified Party shall
have the right to retain its own counsel, and the reasonable fees and expenses
of such counsel shall be at the expense of such Indemnified Party unless (i) the
Seller and such Indemnified Party shall have mutually agreed to the retention of
such counsel, (ii) the named parties to any such proceeding (including, without
limitation, any impleaded parties) include both the Seller and such Indemnified
Party, and representation of both such parties by the same counsel would be
inappropriate due to actual or potential differing interests between them, or
(iii) the Seller shall have failed within a reasonable period to retain counsel
reasonably satisfactory to the Indemnified Party in accordance with the
preceding sentence. It is understood that the Seller shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the legal fees and disbursements of more than one legal counsel for all the
Indemnified Parties. The Seller may, at its option, at any time upon written
notice to the Indemnified Party assume the defense of any proceeding and may
designate counsel satisfactory to the Indemnified Party in connection therewith
provided that the counsel so designated would have no actual or potential
conflict of interest in connection with such
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<PAGE>
representation. Unless it shall assume the defense of any proceeding, the Seller
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the Seller agrees to indemnify the Indemnified Party
from and against any loss or liability by reason of such settlement or judgment.
If the Seller assumes the defense of any proceeding, it shall be entitled to
settle such proceeding with the consent of the Indemnified Party in connection
with all claims which have been asserted against the Indemnified Party in such
proceeding by the other parties to such settlement, and shall be entitled to
settle such proceeding without the consent of the Indemnified Party, provided
that the Indemnified Party receives a full and unconditional release of all
claims asserted against it in such proceeding by the other parties to such
settlement.
(c) If the indemnification provided for in Section 8(a) is unavailable to
an Indemnified Party or insufficient to hold it harmless in respect of any
losses, claims, damages or liabilities referred to therein, then the Seller
shall contribute to the amount paid or payable by such Indemnified Party as a
result of such losses, claims, damages or liabilities, in such proportion as is
appropriate to reflect the relative fault of the Seller and the Indemnified
Party in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the Indemnified Party and the Seller shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties.
(d) The parties hereto agree that it would not be just and equitable if
contribution pursuant to subsection (c) above were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in subsection (c) above. The amount
paid or payable by an Indemnified Party as a result of the losses, claims,
damages or liabilities referred to above shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably incurred
by such Indemnified Party in connection with investigating or defending any such
action or claim, except where the Indemnified Party is required to bear such
expenses pursuant to this Section 8, which expenses the Seller shall pay as and
when incurred, at the request of the Indemnified Party, and to the extent that
any expenses so paid by the Seller are subsequently determined to not be
required to be borne by the Seller hereunder, the Indemnified Party which
received such payment shall promptly refund the amount so paid to the Seller. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
(e) The indemnity and contribution agreements contained in this Section 8
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any of the Indemnified Parties, and (iii) acceptance of and payment for the
Mortgage Loans.
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<PAGE>
(f) The Seller shall (i) pay all out-of-pocket costs and expenses of the
Purchaser reasonably incurred in connection with the enforcement of any right or
remedies of the Purchaser or the Trust provided for by this Agreement, including
the performance of all of the Seller's obligations hereunder, (ii) pay any and
all present and future stamp and other similar taxes with respect to the matters
covered hereby and indemnify and hold harmless the Purchaser from and against
any and all liabilities with respect to or resulting from any delay or omission
in paying such taxes, and (iii) indemnify and hold harmless the Purchaser and
its officers, employees and agents from and against any and all liabilities,
obligations, losses, damages, penalties, judgments, suits, costs, expenses
(including, without limitation, attorneys' and accountants' fees reasonably
incurred) and disbursements of any kind whatsoever that may be imposed on,
incurred by or asserted against the Purchaser or any of its officers, employees
or agents:
(A) in defending or protecting the Purchaser's right, title and
interest in the Mortgage Loans, including, without limitation, the security
interests and liens granted hereunder in the event that the sale hereunder
is deemed to constitute a loan secured by all or part of the Mortgage
Loans, or in defending or protecting the priority of any thereof;
(B) in connection with the performance or non-performance of any
obligation of the Seller with respect to the Mortgage Loans;
(C) in the enforcement, or attempted enforcement, of this Agreement,
or in the collection or attempted collection of any obligation of the
Seller hereunder;
(D) in relation to any misstatement or alleged misstatement of a
material fact in any representation, warranty or other information provided
by the Seller to or for the benefit of the Purchaser in connection with
this Agreement or otherwise or the omission or alleged omission to state
therein a material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading
(exclusive of any such misstatement, alleged misstatement, omission or
alleged omission relating to a Third Party Mortgage Loan);
(E) as a result of any indemnity payable by the Purchaser or the Trust
to the Servicer or Special Servicer arising out of, related to or in
connection with the origination of any Mortgage Loan (other than a Third
Party Mortgage Loan); and
(F) in any other way relating to or arising out of this Agreement or
any of the transactions contemplated hereby.
9. Notices. All communications hereunder shall be in writing and effective
only upon receipt and, if sent to the Purchaser, will be sent by regular prepaid
U.S. Mail or prepaid reputable overnight courier or delivered by hand and
confirmed to it at 277 Park Avenue, 9th Floor, New York, New York 10172,
Attention: N. Dante LaRocca, or such other address as may be designated by the
Purchaser to the Seller in writing, or, if sent to the Seller, will be sent by
regular prepaid U.S. Mail or prepaid reliable overnight courier or delivered by
hand and
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<PAGE>
confirmed to it at 3414 Peachtree Road, N.E., Suite 1140, Atlanta, Georgia
30326-1113, Attention: President, or such other address as may be designated by
the Seller to the Purchaser in writing.
10. Miscellaneous. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated except by a writing signed by the
party against whom enforcement of such change, waiver, discharge or termination
is sought. This Agreement may not be changed in any manner which would have a
material adverse effect on Holders of the Certificates without the prior written
consent of the Trustee. This Agreement also may not be changed in any manner
which would have a material adverse effect on any other third party beneficiary
hereof without the prior written consent of that person. This Agreement may be
executed in any number of counterparts, each of which shall for all purposes be
deemed to be an original and all of which shall together constitute but one and
the same instrument. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and assigns, and no
other person will have any right or obligation hereunder, other than as provided
in Sections 3(a), 3(b), 3(d), 8 and 11 hereof.
11. Third Party Beneficiaries.
(a) The Trustee and the Certificateholders are intended third party
beneficiaries of the representations, warranties and covenants made by the
Seller in Sections 2, 3(a), 3(b), 3(d), 4 and 8(f) (and, to the extent relevant
to the foregoing, in Sections 10, 12, 13, 14, 15, 16 and 19) of this Agreement.
It is acknowledged that such representations, warranties and covenants of the
Seller may be enforced by the Trustee against the Seller, on behalf of itself
and the Certificateholders, to the same extent as if they were parties hereto.
(b) The Underwriter is an intended third party beneficiary of the
representations, warranties and covenants of the Seller set forth in Sections 5,
6 and 8 (and, to the extent relevant to the foregoing, in Sections 10, 13, 14,
15 and 16) of this Agreement. It is acknowledged and agreed that such
representations, warranties and covenants may be enforced by or on behalf of the
Initial Certificate Purchaser against the Seller to the same extent as if it was
a party hereto.
(c) Each of the officers, directors, employees, agents, controlling persons
and affiliates referred to in Section 8 hereof is an intended third party
beneficiary of the representations, warranties, covenants and indemnities of the
Seller set forth in Section 8 (and, to the extent relevant to the foregoing, in
Sections 10, 13, 14, 15 and 16) of this Agreement. It is acknowledged and agreed
that such representations, warranties, covenants and indemnities may be enforced
by or on behalf of any such person or entity against the Seller to the same
extent as if such person or entity was a party hereto.
12. Characterization. It is the express intent of the parties hereto that
the conveyance contemplated by this Agreement be, and be treated for all
purposes as, a sale by the Seller of all the Seller's right, title and interest
in and to the Mortgage Loans. Furthermore, it is not the intention of the
parties that such conveyance be deemed a pledge of the Mortgage Loans by the
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<PAGE>
Seller to secure a debt or other obligation of the Seller. However, in the event
that, notwithstanding the intent of the parties, the Mortgage Loans are held to
continue to be property of the Seller then: (a) this Agreement shall also be
deemed to be a security agreement under applicable law; (b) the transfer of the
Mortgage Loans provided for herein shall be deemed to be a grant by the Seller
to the Purchaser of a first priority security interest in all of the Seller's
right, title and interest in and to the Mortgage Loans and all amounts payable
to the holder(s) of the Mortgage Loans in accordance with the terms thereof
(other than scheduled payments of interest and principal due on or before the
Cut-off Date) and all proceeds of the conversion, voluntary or involuntary, of
the foregoing into cash, instruments, securities or other property; (c) the
assignments by the Purchaser to the Trustee of its interests in the Mortgage
Loans as contemplated by Section 4(d) hereof shall be deemed to be an assignment
of any security interest created hereunder; (d) the possession by the Purchaser
or any successor thereto of the related Mortgage Notes and such other items of
property as constitute instruments, money, negotiable documents or chattel paper
shall be deemed to be "possession by the secured party" for purposes of
perfecting the security interest pursuant to Section 9-305 of the [Georgia]
Uniform Commercial Code and the Uniform Commercial Code of any other applicable
jurisdiction; and (e) notifications to, and acknowledgments, receipts or
confirmations from, persons or entities holding such property, shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Purchaser or any
successor thereto for the purpose of perfecting such security interest under
applicable law. The Seller and the Purchaser shall, to the extent consistent
with this Agreement, take such actions as may be necessary to ensure that, if
this Agreement were deemed to create a security interest in the Mortgage Loans,
such security interest would be deemed to be a perfected security interest of
first priority under applicable law and will be maintained as such throughout
the term of this Agreement and the Pooling and Servicing Agreement.
13. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement,
incorporated herein by reference or contained in the certificates of officers of
the Seller delivered pursuant hereto, shall remain operative and in full force
and effect and shall survive delivery of the Mortgage Loans by the Seller to the
Purchaser (and by the Purchaser to the Trustee), notwithstanding any restrictive
or qualified endorsement or assignment in respect of any Mortgage Loan.
14. Severability of Provisions. Any part, provision, representation,
warranty or covenant of this Agreement that is prohibited or is held to be void
or unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof. Any part,
provision, representation, warranty or covenant of this Agreement that is
prohibited or is held to be void or unenforceable in any particular jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any particular jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.
To the extent permitted by applicable law, the parties hereto waive any
provision of law which prohibits or renders void or unenforceable any provision
hereof.
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<PAGE>
15. Governing Law; Consent to Jurisdiction. This Agreement will be governed
by and construed in accordance with the substantive laws of the State of New
York, applicable to agreements made and to be performed entirely in said state.
The Seller hereby irrevocably (i) submits to the jurisdiction of any New York
State and federal courts sitting in New York City with respect to matters
arising out of or relating to this Agreement; (ii) agrees that all claims with
respect to such action or proceeding may be heard and determined in such New
York State or federal courts; (iii) waives, to the fullest possible extent, the
defense of an inconvenient forum; and (iv) agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
16. Further Assurances. The Seller and the Purchaser agree to execute and
deliver such instruments and take such further actions as the other party may,
from time to time, reasonably request in order to effectuate the purposes and to
carry out the terms of this Agreement.
17. Successors and Assigns. The rights and obligations of the Seller under
this Agreement shall not be assigned by the Seller without the prior written
consent of the Purchaser, except that any person into which the Seller may be
merged or consolidated, or any corporation resulting from any merger, conversion
or consolidation to which the Seller is a party, or any person succeeding to all
or substantially all of the business of the Seller, shall be the successor to
the Seller hereunder. The Purchaser has the right to assign its interest under
this Agreement, in whole or in part, as contemplated by Section 4(d) or as may
otherwise be required to effect the purposes of the Pooling and Servicing
Agreement, and the assignee shall, to the extent of such assignment, succeed to
the rights and obligations hereunder of the Purchaser.
18. Information. The Seller shall provide the Purchaser with such
information about the Seller, the Mortgage Loans and the Seller's underwriting
and servicing procedures as is (i) customary in commercial mortgage loan
securitization transactions, (ii) required by a Rating Agency or a governmental
agency or body or (iii) reasonably requested by the Purchaser for use in a
public or private disclosure document, shall verify the accuracy thereof and
shall remain liable therefor.
19. Cross-Collateralized Mortgage Loans. Notwithstanding anything herein to
the contrary, it is hereby acknowledged that certain groups of Mortgage Loans
identified on the Mortgage Loan Schedule as being cross-collateralized with each
other, are, in the case of each such particular group of Mortgage Loans (each, a
"Cross-Collateralized Group"), evidenced by a single mortgage note and secured
by mortgages, deeds of trust and/or deeds to secure debt on all the Mortgaged
Properties identified on the Mortgage Loan Schedule as corresponding to such
Cross-Collateralized Group. Each such Mortgage Loan actually represents a
portion of the entire indebtedness evidenced by the related mortgage note that
has been allocated to the Mortgaged Property identified on the Mortgage Loan
Schedule as corresponding to such Mortgage Loan. Each of the Mortgage Loans
constituting each such Cross-Collateralized Group shall be deemed to be a
separate Mortgage Loan that is (a) evidenced by a mortgage note identical to the
mortgage note that evidences such Cross-Collateralized Group (but in a principal
amount equal to the
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<PAGE>
principal balance allocated to such Mortgage Loan) and (b) cross-defaulted and
cross-collateralized with each other Mortgage Loan in such Cross-Collateralized
Group. In addition, it is hereby acknowledged that certain other groups of
Mortgage Loans identified on the Mortgage Loan Schedule as being
cross-collateralized with each other, are, in the case of each such particular
group of Mortgage Loans (each, also a "Cross-Collateralized Group"), by their
terms, cross-defaulted and cross-collateralized. For purposes of reference, the
Mortgaged Property that relates or corresponds to any of the Mortgage Loans
referred to in this Section 19 shall be the property identified in the Mortgage
Loan Schedule as corresponding thereto. The provisions of this Agreement,
including, without limitation, each of the representations and warranties set
forth in Exhibit C hereto and each of the capitalized terms used herein but
defined in the Pooling and Servicing Agreement, shall be interpreted in a manner
consistent with this Section 19. In addition, if there exists with respect to
any Cross-Collateralized Group only one original of any document referred to in
the definition of "Mortgage File" and covering all the Mortgage Loans in such
Cross-Collateralized Group, the inclusion of the original of such document in
the Mortgage File for any of the Mortgage Loans constituting such
Cross-Collateralized Group shall be deemed an inclusion of such original in the
Mortgage File for each such Mortgage Loan.
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<PAGE>
IN WITNESS WHEREOF, the Purchaser and the Seller have caused this Agreement
to be duly executed by their respective officers as of the day and year first
above written.
COLUMN FINANCIAL, INC.
By:_________________________________
Name:
Title:
DLJ COMMERCIAL MORTGAGE CORP.
By: ________________________________
Name:
Title:
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<PAGE>
Exhibit A
Certain Documents to be Delivered by the Seller
with Respect to the Mortgage Loans
The documents and instruments to be delivered to the Trustee (or a
Custodian on behalf of the Trustee) in respect of each Mortgage Loan pursuant to
Section 2(a) of this Agreement are, subject to Section 19, as follows:
(i) the original executed Mortgage Note, endorsed (without recourse) to the
order of Norwest Bank Minnesota, N.A., as trustee for the registered
holders of DLJ Commercial Mortgage Corp., Commercial Mortgage Pass-Through
Certificates, Series 1998-CF1;
(ii) an original or copy of the Mortgage and of any intervening assignments
thereof that precede the assignment referred to in clause (iv) below, in
each case (unless such document has not yet been returned from the
applicable recording office) with evidence of recording indicated thereon;
(iii) an original or copy of any related Assignment of Leases (if such item
is a document separate from the Mortgage) and of any intervening
assignments thereof that precede the assignment referred to in clause (v)
below, in each case (unless such document has not yet been returned from
the applicable recording office) with evidence of recording indicated
thereon;
(iv) an original executed assignment of the Mortgage, in favor of Norwest
Bank Minnesota, N.A., as trustee for the registered holders of DLJ
Commercial Mortgage Corp., Commercial Mortgage Pass-Through Certificates,
Series 1998-CF1, in recordable form;
(v) an original assignment of any related Assignment of Leases (if such
item is a document separate from the Mortgage), in favor of Norwest Bank
Minnesota, N.A., as trustee for the registered holders of DLJ Commercial
Mortgage Corp., Commercial Mortgage Pass-Through Certificates, Series
1998-CF1, in recordable form;
(vi) originals or copies of any written assumption, modification and
substitution agreements in those instances where the terms or provisions of
the Mortgage or Mortgage Note have been modified or the Mortgage Loan has
been assumed;
(vii) the original or a copy of the policy or certificate of lender's title
insurance issued on the date of the origination of such Mortgage Loan, or,
if such policy has not been issued, a pro forma policy or an irrevocable,
binding commitment to issue such title insurance policy;
<PAGE>
(viii) filed copies of any prior UCC Financing Statements in favor of the
originator of such Mortgage Loan or in favor of any assignee prior to the
Trustee (but only to the extent the Seller had possession of such UCC
Financing Statements prior to the Closing Date) and, if there is an
effective UCC Financing Statement in favor of the Seller on record with the
applicable public office for UCC Financing Statements, an original UCC-2 or
UCC-3, as appropriate, in favor of Norwest Bank Minnesota, N.A., as trustee
for the registered holders of DLJ Commercial Mortgage Corp., Commercial
Mortgage Pass-Through Certificates, Series 1998-CF1;
(ix) any environmental indemnity agreement, property management agreement,
ground lease, intercreditor agreement, cash management agreement and
lock-box agreement relating to such Mortgage Loan; and
(x) any original documents relating to Additional Collateral.
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<PAGE>
Exhibit B
Representations and Warranties with respect to the Seller
The Seller hereby represents and warrants that, as of the Closing Date:
(a) The Seller is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and is possessed of all
licenses necessary to carry on its business and is qualified and in good
standing and 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 as contemplated by the terms of this Agreement and the Pooling and
Servicing Agreement.
(b) The execution and delivery by the Seller of this Agreement, as well as
the execution (including, without limitation, by facsimile or machine signature)
of any and all documents contemplated by this Agreement, including, without
limitation, endorsements of Mortgage Notes, and the performance and compliance
by the Seller with the terms of this Agreement will not (i) violate the Seller's
organizational documents, (ii) violate any law or regulation or any
administrative decree or order to which the Seller is subject or (iii)
constitute a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach of, any indenture,
agreement or other instrument to which the Seller is a party or by which it is
bound or which is applicable to it or any of its assets.
(c) The Seller has full power and authority to enter into and consummate
all transactions contemplated by this Agreement, has duly authorized the
execution, delivery and performance of this Agreement, and has duly executed and
delivered this Agreement.
(d) The Seller has the full right, power and authority to sell, assign,
transfer, set over and convey the Mortgage Loans (and, in the event that the
related transaction is deemed to constitute a loan secured by all or part of the
Mortgage Loans, to pledge the Mortgage Loans) in accordance with, and under the
conditions set forth in, this Agreement.
(e) Assuming due authorization, execution and delivery hereof by the
Purchaser, this Agreement constitutes or will constitute a valid, legal and
binding obligation of the Seller, enforceable against the Seller in accordance
with the terms hereof, subject to (i) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity, regardless of
whether such enforcement is considered in a proceeding in equity or at law.
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<PAGE>
(f) The Seller is not in violation of, and its execution and delivery of
this Agreement and its performance and compliance with the terms hereof will not
constitute a violation of, any law, any order or decree of any court or arbiter,
or any order, regulation or demand of any federal, state or local governmental
or regulatory authority, which violation, in the Seller's good faith and
reasonable judgment, is likely to affect materially and adversely either the
ability of the Seller to perform its obligations under this Agreement or the
financial condition of the Seller.
(g) No litigation is pending or, to the best of the Seller's knowledge,
threatened against the Seller which, if determined adversely to the Seller,
would prohibit the Seller from entering into this Agreement or, in the Seller's
good faith and reasonable judgment, is likely to materially and adversely affect
either the ability of the Seller to perform its obligations hereunder or the
financial condition of the Seller.
(h) The transfer of the Mortgage Loans to the Purchaser as contemplated
herein is not subject to any bulk transfer or similar law in effect in any
applicable jurisdiction.
(i) The principal place of business and chief executive office of the
Seller is located in Atlanta, Georgia.
(j) The Seller is a wholly-owned subsidiary of DLJ Mortgage Capital, Inc.
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<PAGE>
Exhibit C
Representations and Warranties with respect to the Mortgage Loans
For purposes of this Exhibit C, the phrase "the Seller's knowledge" and
other words and phrases of like import shall mean the actual state of knowledge
of the Seller regarding the matters referred to, in each case without having
conducted any independent inquiry into such matters and without any obligation
to have done so (except as expressly set forth herein).
The Seller hereby represents and warrants that, as of the date hereinbelow
specified or, if no such date is specified, as of the Closing Date and subject
to Section 19 of this Agreement:
1. Mortgage Loan Schedule. The information set forth in the Mortgage Loan
Schedule with respect to the Mortgage Loans is complete, true and correct in all
material respects as of the date of this Agreement and as of the Cut-off Date.
2. Ownership of Mortgage Loans. Immediately prior to the transfer to the
Purchaser of the Mortgage Loans, the Seller had good title to, and was the sole
owner of, each Mortgage Loan. The Seller has full right, power and authority to
transfer and assign each Mortgage Loan to or at the direction of the Purchaser
and has validly and effectively conveyed (or caused to be conveyed) to the
Purchaser or its designee all of the Seller's legal and beneficial interest in
and to the Mortgage Loans free and clear of any and all pledges, liens, charges,
security interests and/or other encumbrances. The sale of the Mortgage Loans to
the Purchaser or its designee does not require the Seller to obtain any
governmental or regulatory approval or consent that has not been obtained.
3. Payment Record. As of the Closing Date, no scheduled payment of
principal and interest under any Mortgage Loan was thirty (30) days or more past
due, and no Mortgage Loan has been thirty (30) days or more delinquent in the
twelve-month period immediately preceding the Closing Date.
4. Lien; Valid Assignment. The Mortgage related to and delivered in
connection with each Mortgage Loan constitutes a valid and, subject to the
exceptions set forth in Paragraph 13 below, enforceable first priority lien (or,
in the case of one Mortgage Loan, second priority lien) upon the related
Mortgaged Property, prior to all other liens and encumbrances, except for (a)
the lien for current real estate taxes and assessments not yet due and payable,
(b) covenants, conditions and restrictions, rights of way, easements and other
matters that are of public record and/or are referred to in the related lender's
title insurance policy, none of which materially interferes with the security
intended to be provided by such Mortgage, the current use of the related
Mortgaged Property or the current ability of the related Mortgaged
<PAGE>
Property to generate income sufficient to service the related Mortgage Loan, (c)
exceptions and exclusions specifically referred to in such lender's title
insurance policy, none of which materially interferes with the security intended
to be provided by such Mortgage, the current use of the related Mortgaged
Property or the current ability of the related Mortgaged Property to generate
income sufficient to service the related Mortgage Loan, (d) other matters to
which like properties are commonly subject, none of which materially interferes
with the security intended to be provided by such Mortgage, the use of the
related Mortgaged Property or the current ability of the related Mortgaged
Property to generate income sufficient to service the related Mortgage Loan, and
(e) the lien of the Mortgage for another Mortgage Loan (the foregoing items (a)
through (e) being herein referred to as the "Permitted Encumbrances"). The
related assignment of such Mortgage executed and delivered in favor of the
Trustee is in recordable form and constitutes a legal, valid and binding
assignment, sufficient to convey to the assignee named therein all of the
assignor's right, title and interest in, to and under such Mortgage. Such
Mortgage, together with any separate security agreements, chattel mortgages or
equivalent instruments, establishes and creates a valid and, subject to the
exceptions set forth in Paragraph 13 below, enforceable security interest in
favor of the holder thereof in all of the related Mortgagor's personal property
used in, and reasonably necessary to operate, the related Mortgaged Property. A
Uniform Commercial Code financing statement has been filed and/or recorded in
all places necessary to perfect a valid security interest in such personal
property, and such security interest is only subject to any prior purchase money
security interest in such personal property, any personal property leases
applicable to such personal property and any security interest in such personal
property granted in connection with another Mortgage Loan.
5. Assignment of Leases and Rents. The Assignment of Leases, if any,
related to and delivered in connection with each Mortgage Loan establishes and
creates a valid, subsisting and, subject to the exceptions set forth in
Paragraph 13 below, enforceable first priority lien (or, in the case of one
Mortgage Loan, second priority lien) on and security interest in the related
Mortgagor's interest in all leases, sub-leases, licenses or other agreements
pursuant to which any person is entitled to occupy, use or possess all or any
portion of the related Mortgaged Property, and each assignor thereunder has the
full right to assign the same. The related assignment of such Assignment of
Leases executed and delivered in favor of the Trustee is in recordable form and
constitutes a legal, valid and binding assignment, sufficient to convey to the
assignee named therein all of the assignor's right, title and interest in, to
and under such Assignment of Leases. To the Seller's knowledge, no person owns
any interest in any payments due under the related leases that is superior to
the lien created by such Assignment of Leases, if any.
6. Mortgage Status; Waivers and Modifications. No Mortgage related to a
Mortgage Loan has been satisfied, canceled, rescinded or subordinated in whole
or in material part, and the related Mortgaged Property has not been released
from the lien of such Mortgage, in whole or in material part, nor has any
instrument been executed that would effect any such satisfaction, cancellation,
subordination, rescission or release. None of the terms of any Mortgage Note,
Mortgage or Assignment of Leases related to a Mortgage Loan have been impaired,
waived, altered or modified in any respect, except by written instruments, all
of which are included in the
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related Mortgage File. No Mortgage Loan has been modified in any manner such
that the terms of such Mortgage Loan, as so modified, are materially (and
adversely to the owner thereof) different from the terms of such Mortgage Loan
described in the Prospectus.
7. Condition of Property; Condemnation. Each Mortgaged Property securing a
Mortgage Loan is, to the Seller's knowledge, based on its review of the most
recent inspection report (which, if prepared by a servicer of such Mortgage
Loan, was so prepared in accordance with the related servicing agreement), free
and clear of any damage that would materially and adversely affect its value as
security for such Mortgage Loan. The Seller has not received notice (and is not
otherwise aware) of any proceeding pending for the total or partial condemnation
of or affecting the Mortgaged Property securing any Mortgage Loan. To the
Seller's knowledge, as of the date of the origination of each Mortgage Loan, all
of the material improvements on the related Mortgaged Property lay wholly within
the boundaries and building restriction lines of such property, except for
encroachments that are insured against by the lender's title insurance policy
referred to herein or that do not materially and adversely affect the value or
marketability of such Mortgaged Property, and no improvements on adjoining
properties materially encroached upon such Mortgaged Property so as to
materially and adversely affect the value or marketability of such Mortgaged
Property.
8. Title Insurance. Each Mortgaged Property securing a Mortgage Loan is
covered by an American Land Title Association (or an equivalent form of)
lender's title insurance policy (the "Title Policy") in the original principal
amount of such Mortgage Loan after all advances of principal insuring that the
related Mortgage is a valid first priority lien (or, in the case of one Mortgage
Loan, second priority lien) on such Mortgaged Property, subject only to the
exceptions stated therein (or a pro forma title policy or marked up title
insurance commitment on which the required premium has been paid exists which
evidences that such Title Policy will be issued). Such Title Policy (or, if it
has yet to be issued, the coverage to be provided thereby) is in full force and
effect, all premiums thereon have been paid and, to the Seller's knowledge, no
material claims have been made thereunder and no claims have been paid
thereunder (and the Seller has not received notice of any material claims having
been made or paid thereunder). No holder of the related Mortgage has done, by
act or omission, anything that would materially impair the coverage under such
Title Policy. Immediately following the transfer and assignment of the related
Mortgage Loan to the Trustee, such Title Policy (or, if it has yet to be issued,
the coverage to be provided thereby) will inure to the benefit of the Trustee
without the consent of or notice to the insurer. The insurer issuing such Title
Policy is qualified to do business in the jurisdiction in which the related
Mortgaged Property is located, and such Title Policy contains no exclusion for,
or it affirmatively insures, (a) access to a public road, (b) that there are no
material encroachments of any part of the improvements on the related Mortgaged
Property over easements, which encroachments could reasonably be expected to
materially interfere with the use of the related Mortgaged Property (unless the
related Mortgaged Property is located in a jurisdiction where such affirmative
insurance is not available) and (c) that the area shown on the survey conducted
in connection with the origination of the related Mortgage Loan is the same as
the property legally described in the related Mortgage.
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9. No Holdback. The proceeds of each Mortgage Loan have been fully
disbursed (except in those cases where the full amount of the Mortgage Loan has
been made but a portion thereof is being held back pending the satisfaction of
certain leasing or other economic criteria with respect to the related Mortgaged
Property), and there is no obligation for future advances with respect thereto.
Any and all requirements under each Mortgage Loan as to completion of any
on-site or off-site improvement and as to disbursements of any funds escrowed
for such purpose, which requirements were to have been complied with on or
before the Closing Date, have been complied with or any such funds so escrowed
have not been released.
10. Mortgage Provisions. The Mortgage Note or Mortgage for each Mortgage
Loan, together with applicable state law, contains customary and enforceable
provisions (subject to the exceptions set forth in Paragraph 13) such as to
render the rights and remedies of the holder thereof adequate for the practical
realization against the related Mortgaged Property of the principal benefits of
the security intended to be provided thereby.
11. Trustee under Deed of Trust. If the Mortgage in respect of any Mortgage
Loan is a deed of trust, (a) a trustee, duly qualified under applicable law to
serve as such, is properly designated and serving under such Mortgage, and (b)
except in connection with a trustee's sale after default by the related
Mortgagor, no fees or expenses are payable to such trustee by the Seller, the
Purchaser or any transferee thereof.
12. Environmental Conditions. An environmental site assessment was
performed with respect to each Mortgaged Property in connection with the
origination of the related Mortgage Loan, a report of each such assessment (an
"Environmental Report") has been delivered to the Purchaser, and either (x) no
such Environmental Report reveals any known circumstances or conditions with
respect to the related Mortgaged Property that rendered such Mortgaged Property,
at the date of such Environmental Report, in material violation of any
applicable environmental laws or (y) if any such Environmental Report does
reveal any such circumstances or conditions with respect to the related
Mortgaged Property and the same have not been subsequently remediated in all
material respects, then either (i) the expenditure of funds necessary to effect
such remediation is not material in relation to the outstanding principal
balance of the related Mortgage Loan, or (ii) a sufficient escrow of funds
exists for purposes of effecting such remediation, or (iii) the related
Mortgagor or other responsible party is currently taking such actions, if any,
with respect to such circumstances or conditions as have been required by the
applicable governmental regulatory authority. To the Seller's knowledge, there
are no circumstances or conditions with respect to such Mortgaged Property not
revealed in such Environmental Report that render such Mortgaged Property in
material violation of any applicable environmental laws. The Mortgage
encumbering such Mortgaged Property requires the related Mortgagor to comply
with all applicable federal, state and local environmental laws and regulations.
13. Loan Document Status. Each Mortgage Note, Mortgage, and other agreement
executed by or on behalf of the related Mortgagor with respect to each Mortgage
Loan is the legal, valid and binding obligation of the maker thereof (subject to
any non-recourse
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provisions contained in any of the foregoing agreements and any applicable state
anti-deficiency or market value limit deficiency legislation), enforceable in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally, and by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law), and there is no valid defense, counterclaim or right of offset or
rescission available to the related Mortgagor with respect to such Mortgage
Note, Mortgage or other agreements.
14. Insurance. Except in certain cases, where tenants (having extremely
high net worth or investment grade credit ratings) with the obligation to
maintain the insurance described in this paragraph are allowed to self-insure
the related Mortgaged Properties, all improvements upon each Mortgaged Property
securing a Mortgage Loan are insured against loss by hazards of extended
coverage in an amount at least equal to the lesser of the outstanding principal
balance of such Mortgage Loan and 100% of the full replacement cost of the
improvements located on the related Mortgaged Property, and if applicable, the
related hazard insurance policy contains appropriate endorsements to avoid the
application of co-insurance and does not permit reduction in insurance proceeds
for depreciation. Each Mortgaged Property securing a Mortgage Loan is the
subject of a business interruption insurance policy providing coverage for at
least six (6) months. If any portion of a Mortgaged Property securing any
Mortgage Loan was, at the time of the origination of such Mortgage Loan, in an
area identified in the Federal Register by the Flood Emergency Management Agency
as having special flood hazards, and flood insurance was available, a flood
insurance policy meeting any requirements of the then current guidelines of the
Federal Insurance Administration is in effect with a generally acceptable
insurance carrier, in an amount representing coverage not less than the least of
(1) the outstanding principal balance of such Mortgage Loan, (2) the full
insurable value of such Mortgaged Property, and (3) the maximum amount of
insurance available under the National Flood Insurance Act of 1968, as amended.
All such hazard and flood insurance policies contain a standard "New York"
mortgagee clause for the benefit of the holder of the related Mortgage, its
successors and assigns, as mortgagee, and are not terminable (nor may the amount
of coverage provided thereunder be reduced) without ten (10) days' prior written
notice to the mortgagee, and all premiums payable thereon as of the Closing
Date, whether annual or otherwise, have been paid. Each Mortgaged Property
securing a Mortgage Loan is also covered by commercial general liability
insurance in an amount at least equal to $1 million per occurrence. No notice of
termination, cancellation or reduction has been received by the Seller with
respect to any such hazard, flood or liability insurance policy. Except under
circumstances that would be reasonably acceptable to a prudent commercial
mortgage lender or that would not otherwise materially and adversely affect the
security intended to be provided by the related Mortgage, the Mortgage for each
Mortgage Loan provides that proceeds paid under any such casualty insurance
policy will (or, at the lender's option, will) be applied either to the repair
or restoration of the related Mortgaged Property or to the payment of amounts
due under such Mortgage Loan.
15. Taxes and Assessments. To the Seller's knowledge, there are no
delinquent or unpaid taxes or assessments (including assessments payable in
future installments), or other outstanding charges affecting any Mortgaged
Property securing a Mortgage Loan which are or
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may become a lien of priority equal to or higher than the lien of the related
Mortgage. For purposes of this representation and warranty, real property taxes
and assessments shall not be considered unpaid until the date on which interest
and/or penalties would be payable thereon.
16. Mortgagor Bankruptcy. No Mortgagor under a Mortgage Loan is, to the
Seller's knowledge, a debtor in any state or federal bankruptcy or insolvency
proceeding.
17. Local Law Compliance. The improvements located on or forming part of
each Mortgaged Property securing a Mortgage Loan comply with applicable zoning
laws and ordinances, or constitute a legal non-conforming use or structure or,
if any such improvement does not so comply, such non-compliance does not
materially and adversely affect the value of the related Mortgaged Property.
18. Leasehold Estate Only. If such Mortgage Loan is secured by the interest
of a Mortgagor as a lessee under a ground lease of a Mortgaged Property (a
"Ground Lease"), but not by the related fee interest in such Mortgaged Property
(the "Fee Interest"):
(a) Such Ground Lease or a memorandum thereof has been or will be duly
recorded; such Ground Lease permits the interest of the lessee
thereunder to be encumbered by the related Mortgage; and there has
been no material change in the terms of such Ground Lease since its
recordation, with the exception of written instruments which are a
part of the related Mortgage File;
(b) Such Ground Lease is not subject to any liens or encumbrances superior
to, or of equal priority with, the related Mortgage, other than the
related Fee Interest and Permitted Encumbrances;
(c) The Mortgagor's interest in such Ground Lease is assignable to the
Purchaser and its successors and assigns upon notice to, but without
the consent of, the lessor thereunder (or, if such consent is
required, it has been obtained prior to the Closing Date) and, in the
event that it is so assigned, is further assignable by the Purchaser
and its successors and assigns upon notice to, but without the need to
obtain the consent of, such lessor;
(d) At the Closing Date, such Ground Lease is in full force and effect,
and the Seller has not received notice (nor is the Seller otherwise
aware) that any default has occurred under such Ground Lease;
(e) Such Ground Lease requires the lessor thereunder to give notice of any
default by the lessee to the mortgagee (provided that the mortgagee
has provided the lessor with notice of its lien in accordance with the
provisions of such Ground Lease), and such Ground Lease, or an
estoppel letter received by the mortgagee from the lessor, further
provides that no notice
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of termination given under such Ground Lease is effective against the
mortgagee unless a copy has been delivered to the mortgagee in the
manner described in such Ground Lease;
(f) A mortgagee is permitted a reasonable opportunity (including, where
necessary, sufficient time to gain possession of the interest of the
lessee under such Ground Lease) to cure any default under such Ground
Lease, which is curable after the receipt of notice of any such
default, before the lessor thereunder may terminate such Ground Lease;
(g) Such Ground Lease either (i) has an original term which extends not
less than ten (10) years beyond the Stated Maturity Date of the
related Mortgage Loan or (ii) has an original term which does not end
prior to the Stated Maturity Date of the related Mortgage Loan and has
extension options that, if exercised by the related Mortgagor, cause
the term of such Ground Lease to extend not less than (10) years
beyond the Stated Maturity Date of the related Mortgage Loan;
(h) Such Ground Lease requires the lessor to enter into a new lease with a
mortgagee upon termination of such Ground Lease for any reason,
including rejection of such Ground Lease in a bankruptcy proceeding;
(i) Under the terms of such Ground Lease and the related Mortgage, taken
together, any related insurance proceeds (other than in respect of a
total or substantially total loss or taking) will be applied either
(i) to the repair or restoration of all or part of the related
Mortgaged Property, with the mortgagee or a trustee appointed by it
having the right to hold and disburse such proceeds as the repair or
restoration progresses (except in such cases where a provision
entitling another party to hold and disburse such proceeds would not
be viewed as commercially unreasonable by a prudent commercial
mortgage lender), or (ii) to the payment of the outstanding principal
balance of the Mortgage Loan together with any accrued interest
thereon; and
(j) Such Ground Lease does not impose any restrictions on subletting which
would be viewed as commercially unreasonable by a prudent commercial
mortgage lender; and such Ground Lease contains a covenant that the
lessor thereunder is not permitted, in the absence of an uncured
default, to disturb the possession, interest or quiet enjoyment of any
lessee in the relevant portion of the Mortgaged Property subject to
such Ground Lease for any reason, or in any manner, which would
materially adversely affect the security provided by the related
Mortgage.
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19. Leasehold Estate and Fee Interest. If any Mortgage Loan is secured in
whole or in part by the interest of the related Mortgagor under a Ground Lease
and by the related Fee Interest:
(a) Such Fee Interest is subject, and subordinated of record, to the
related Mortgage; and the related Mortgage does not by its terms
provide that it will be subordinated to the lien of any other mortgage
or other lien upon such Fee Interest; and
(b) Upon occurrence of a default under the terms of the related Mortgage
by the Mortgagor, the mortgagee has the right to foreclose upon or
otherwise exercise its rights with respect to such Fee Interest within
a period of time that would not have been viewed, as of the date of
origination, as commercially unreasonable by a prudent commercial
mortgage lender.
20. Escrow Deposits. With respect to escrow deposits and payments relating
to any Mortgage Loan, all such payments have been delivered to the Servicer, and
there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made.
21. Qualified Mortgage. Such Mortgage Loan is a "qualified mortgage" within
the meaning of Section 860G(a)(3) of the Code.
22. Advancement of Funds. No holder of a Mortgage Loan has, to the Seller's
knowledge, advanced funds or induced, solicited or knowingly received any
advance of funds from a party other than the owner of the related Mortgaged
Property, directly or indirectly, for the payment of any amount required by such
Mortgage Loan.
23. Equity Interest. No Mortgage Loan is automatically convertible into an
equity ownership interest in the related Mortgaged Property or the related
Mortgagor.
24. Legal Proceedings. To the Seller's knowledge, there are no pending or
threatened actions, suits or proceedings by or before any court or governmental
authority against or affecting the Mortgagor under any Mortgage Loan or the
related Mortgaged Property that, if determined adversely to such Mortgagor or
Mortgaged Property, would materially and adversely affect the value of the
Mortgaged Property or the ability of the Mortgagor to pay principal, interest or
any other amounts due under such Mortgage Loan.
25. Junior Liens. Except as otherwise described under "Description of the
Mortgage Pool--Subordinate Financing" in the Prospectus Supplement, none of the
Mortgage Loans permit the related Mortgaged Property to be encumbered by any
lien junior to or of equal priority with the lien of the related Mortgage
without the prior written consent of the holder thereof. To the Seller's
knowledge, except as otherwise specified under "Description of the Mortgage
Pool--Subordinate Financing" in the Prospectus Supplement, and except for cases
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involving other Mortgage Loans, the Mortgaged Properties are not encumbered by
any liens junior to the liens of the related Mortgages. In each of the three
cases described under "Description of the Mortgage Pool--Subordinate Financing"
in the Prospectus Supplement where a Mortgaged Property securing a Mortgage Loan
is further encumbered by a junior lien, the loan secured by such junior lien is
subject to a subordination and standstill agreement that subordinates such loan
and prohibits the related junior creditor from pursuing any remedies for default
or causing any bankruptcy proceeding while such Mortgage Loan is outstanding.
Except in cases involving other Mortgage Loans, the Mortgaged Properties are not
encumbered by any liens of equal priority with the liens of the related
Mortgages.
26. No Mechanics' Liens. To the Seller's knowledge, (i) each Mortgaged
Property securing a Mortgage Loan is free and clear of any and all mechanics'
and materialmen's liens that are not bonded or escrowed for, and (ii) no rights
are outstanding that under law could give rise to any such lien that would be
prior or equal to the lien of the related Mortgage. The Seller has not received
notice with respect to any Mortgage Loan that any mechanics' and materialmen's
liens have encumbered the related Mortgaged Property since origination that have
not been released, bonded or escrowed for.
27. Compliance with Usury Laws. Each Mortgage Loan complied with all
applicable usury laws in effect at its date of origination.
28. Licenses and Permits. To the Seller's knowledge, based on due diligence
customarily performed by commercially reasonable lenders in the origination of
comparable mortgage loans, as of the date of origination of each Mortgage Loan,
(i) the related Mortgagor was in possession of all material licenses, permits
and authorizations required by applicable law for the ownership and operation of
the related Mortgaged Property and (ii) all such licenses, permits and
authorizations were valid and in full force and effect.
29. Servicing Practices. The servicing and collection practices used with
respect to the Mortgage Loans have in all material respects been legal and met
customary standards utilized by prudent institutional commercial and multifamily
mortgage loan master servicers.
30. Cross-collateralization. No Mortgage Loan is cross-collateralized with
any loan other than one or more other Mortgage Loans.
31. Releases of Mortgaged Property. Except as described in the next
sentence, no Mortgage Note or Mortgage requires the mortgagee to release all or
any portion of the related Mortgaged Property from the lien of the related
Mortgage except upon (i) payment in full of all amounts due under the related
Mortgage Loan or (ii) delivery of U.S. Treasury securities in connection with a
defeasance of the related Mortgage Loan. The Cross-Collateralized Mortgage
Loans, and the other individual Mortgage Loans secured by multiple parcels, may
require the respective mortgagee(s) to grant releases of portions of the related
Mortgaged Property or, in the case of a Cross-Collateralized Group, the release
of one or more related Mortgaged Properties
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upon (a) the satisfaction of certain legal and underwriting requirements and (b)
the payment of a release price and prepayment consideration in connection
therewith.
32. No Equity Participation or Contingent Interest. No Mortgage Loan
contains any equity participation by the lender or provides for any contingent
or additional interest in the form of participation in the cash flow of the
related Mortgaged Property.
33. Fixed Rate Loans. Each Mortgage Loan bears interest at a rate that
remains fixed throughout the remaining term of such Mortgage Loan, except as
otherwise described under "Description of the Mortgage Pool--General" in the
Prospectus Supplement and except for the imposition of a default rate.
34. Inspection. In connection with the origination of each Mortgage Loan
(other than the Third Party Mortgage Loans), the Seller inspected, or caused the
inspection of, the related Mortgaged Property.
35. No Material Default. There exists no material default, breach,
violation or event of acceleration (and no event which, with the passage of time
or the giving of notice, or both, would constitute any of the foregoing) under
the Mortgage Note or Mortgage for any Mortgage Loan, in any such case to the
extent the same materially and adversely affects the value of the Mortgage Loan
and the related Mortgaged Property; provided, however, that this representation
and warranty does not cover any default, breach, violation or event of
acceleration that specifically pertains to or arises out of the subject matter
otherwise covered by any other representation and warranty made by the Seller in
any of Paragraphs 3, 7, 12, 14, 15, 16, 17, 20, 24, 25, 26 and 28 of this
Exhibit C.
36. Due-on-Sale. Subject to a one-time (or, in the case of certain Mortgage
Loans, a multiple-time) transfer right allowed in accordance with certain
provisions set forth in the Mortgage securing each Mortgage Loan, such Mortgage
contains a "due-on-sale" clause that provides for the acceleration of the
payment of the unpaid principal balance of such Mortgage Loan if, without the
prior written consent of the holder, the Mortgaged Property subject to such
Mortgage, or any interest therein, is directly or indirectly transferred or
sold.
37. Single Purpose Entity. Except with respect to Stone Container
Corporation, the Mortgagor on each Mortgage Loan that, individually or together
with the Mortgage Loans of affiliated Mortgagors, represented 5% or more of the
Initial Pool Balance, was, as of the origination of the Mortgage Loan, a Single
Purpose Entity. For this purpose, a "Single Purpose Entity" shall mean an
entity, other than an individual, whose organizational documents provide
substantially to the effect that it was formed or organized solely for the
purpose of owning and operating one or more of the Mortgaged Properties securing
the Mortgage Loans and prohibit it from engaging in any business unrelated to
such Mortgaged Property or Properties, and whose organizational documents
further provide, or which entity represented in the related Mortgage Loan
documents, substantially to the effect that it does not have any assets other
than those related to its interest in and operation of such Mortgaged Property
or Properties, or any indebtedness
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other than as permitted by the related Mortgage(s) or the other related Mortgage
Loan documents, that it has its own books and records and accounts separate and
apart from any other person, and that it holds itself out as a legal entity,
separate and apart from any other person.
38. Delivery of Mortgage File. The Seller has delivered to the Trustee or a
Custodian appointed thereby, with respect to each Mortgage Loan, in accordance
with Section 2 of this Agreement, a complete Mortgage File (or, with respect to
any missing documents or instruments required to be part of such Mortgage File,
a Trust Receipt).
39. Whole Loan. Each Mortgage loan is a whole loan and not a participation
interest in a mortgage loan.
40. ARD Loans. As of the Closing Date, each ARD Loan requires scheduled
monthly payments of principal. If any ARD Loan is not paid in full by its
Anticipated Repayment Date, and assuming that it is not otherwise in default,
the rate at which such ARD Loan accrues interest will increase by two percentage
points (or, in the case of the Showboat Loan, by the lesser of (a) five
percentage points and (b) the excess, if any, of (i) the applicable U.S.
Treasury-based rate plus 2%, over (ii) the original Mortgage Rate).
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Exhibit D-1
Certificate of an Officer of the Seller
DLJ COMMERCIAL MORTGAGE CORP.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Certificate of Secretary of Column Financial, Inc.
I, ____________________, a Secretary of Column Financial, Inc. ("Column")
hereby certify as follows:
1. Column is duly incorporated and in good standing under the laws of the
State of Delaware.
2. Attached hereto as Exhibit I are true and correct copies of the Articles
of Incorporation and By-Laws of Column, which Articles of Incorporation and
By-Laws are on the date hereof, and have been at all times, in full force and
effect.
3. To the best of my knowledge, no proceedings looking toward liquidation
or dissolution of Column are pending or contemplated.
4. Each person listed below is and has been the duly elected and qualified
officer or authorized signatory of Column and his/her genuine signature is set
forth opposite his/her name:
Name Office Signature
---- ------ ---------
- - ----------------------- ----------------------- ----------------------------
- - ----------------------- ----------------------- ----------------------------
(i) Each person listed above who signed, either manually or by facsimile
signature, the Mortgage Loan Purchase and Sale Agreement, dated as of February
___, 1998 (the "Agreement"), between DLJ Commercial Mortgage Corp. ("DLJCMC")
and Column, or any certificate delivered pursuant thereto, was, at the time of
such signing and delivery, duly authorized or appointed to execute such document
in such capacity, and the signatures of such persons or facsimiles thereof
appearing on such document are their genuine signatures.
[o(ii) Attached hereto as Exhibit II is a true and correct copy of the
resolutions of the Board of Directors of Column enacted on _______________
authorizing the Agreement and the consummation of the transactions contemplated
thereby. Such resolutions have not been rescinded and, as of the date hereof,
remain in full force and effect.]
<PAGE>
Capitalized terms used but not defined herein have the respective meanings
given to them in the Agreement.
IN WITNESS WHEREOF, the undersigned has executed this certificate as of
___________, 1998.
___________________________________
Name:
Title: Secretary
I, _______________, a ____________________ of Column, hereby certify that
__________________ is a duly elected or appointed, as the case may be, qualified
and acting Secretary of Column and that the signature appearing above is such
officer's genuine signature.
IN WITNESS WHEREOF, the undersigned has executed this certificate as of
___________, 1998.
___________________________________
Name:
Title:
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<PAGE>
Exhibit D-2
Certificate of the Seller
DLJ COMMERCIAL MORTGAGE CORP.
Commercial Mortgage Pass-Through Certificates
Series 1998-CF1
Certificate of Column Financial, Inc.
In connection with the execution and delivery by Column Financial, Inc.
("Column") of, and the consummation of the various transactions contemplated by,
that certain Mortgage Loan Purchase and Sale Agreement, dated as of _________,
1998 (the "Agreement"), between DLJ Commercial Mortgage Corp., as purchaser, and
Column, as seller, the undersigned hereby certifies that (i) the representations
and warranties of Column in the Agreement are true and correct in all material
respects at and as of the date hereof with the same effect as if made on the
date hereof, (ii) Column has, in all material respects, complied with all the
agreements and satisfied all the conditions on its part required under the
Agreement to be performed or satisfied at or prior to the date hereof, and (iii)
Column has reviewed and approved the information set forth in each of the
Prospectus Supplement and the Memorandum under the caption "Description of the
Mortgage Pool" and elsewhere in the Prospectus Supplement and the Memorandum
with respect to the subjects discussed under such caption in each, as well as
the information set forth on Exhibits A-1 and A-2 to the Prospectus Supplement,
and such information did not, as of the date of the Prospectus Supplement and
the Memorandum, and does not, as of the date hereof, include any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading (provided that Column makes no certification as
to whether such information included or includes any untrue statement of a
material fact with respect to the Third Party Originators and/or the Third Party
Mortgage Loans or omitted or omits to state a material fact with respect
thereto). Capitalized terms used but not defined herein shall have the
respective meanings assigned to them in the Agreement.
Certified this ____ day of _______, 1998.
COLUMN FINANCIAL, INC.
By: ________________________________
Name:
Title:
<PAGE>
Exhibit D-3
Opinion of Counsel to the Seller
___________, 1998
DLJ Commercial Mortgage Corp.
277 Park Avenue
New York, NY 10172
Donaldson, Lufkin & Jenrette Securities Corporation
277 Park Avenue
New York, N.Y. 10172
Norwest Bank Minnesota, N.A.
3 New York Plaza
15th Floor
New York, NY 10004
Standard & Poor's Rating Services, A Division of
the McGraw-Hill Companies, Inc.
26 Broadway, 10th Floor
New York, NY 10004
Moody's Investors Service, Inc.
99 Church Street
New York, NY 10007
Fitch Investors Service, L.P.
One State Street Plaza
New York, NY 10004
Re: DLJ Commercial Mortgage Corp. Commercial Mortgage Pass-Through
Certificates, Series 1998-CF1
Ladies and Gentlemen:
We have acted as counsel to Column Financial, Inc. (the "Seller") in
connection with the sale of certain mortgage loans (the "Mortgage Loans") by the
Seller to DLJ Commercial Mortgage Corp. ("DLJCMC"), pursuant to a Mortgage Loan
Purchase and Sale Agreement, dated as of __________, 1998 (the "Agreement"),
between the Seller and DLJCMC. This opinion is
<PAGE>
being delivered to you pursuant to the Agreement. Capitalized terms not defined
herein have the meanings set forth in the Agreement.
In rendering this opinion letter, we have examined the Agreement and such
other documents as we have deemed necessary. As to matters of fact, we have
examined and relied upon representations of the Seller contained in the
Agreement and, where we have deemed appropriate, representations or
certifications of parties to the Agreement or public officials. We have assumed
the authenticity of all documents submitted to us as originals, the genuineness
of all signatures, the legal capacity of natural persons and the conformity to
the originals of all documents submitted to us as copies. We have assumed that
all parties to the Agreement other than the Seller had the corporate power and
authority to enter into and perform all obligations thereunder. As to such
parties other than the Seller, we also have assumed the due authorization by all
requisite corporate action, the due execution and delivery and the
enforceability of such document. We have further assumed the conformity of the
Mortgage Loans and related documents to the requirements of the Agreement and
have assumed that the Seller is the owner of the Mortgage Loans.
Based upon and subject to the foregoing, it is our opinion that:
1. The Seller is a corporation duly incorporated and validly existing and
in good standing under the laws of the State of Delaware and has the requisite
corporate power to own its properties, to conduct its business as presently
conducted by it, to own and to transfer and convey to DLJCMC the Mortgage Loans
and to enter into and perform its obligations under the Agreement.
2. The Agreement has been duly and validly authorized, executed and
delivered by the Seller and constitutes a valid, legal and binding agreement of
the Seller, enforceable against the Seller in accordance with its terms.
3. No consent, approval, authorization or order of any State of Georgia,
State of Delaware or federal court or governmental agency or body is required
for the consummation by the Seller of the transactions contemplated by the
Agreement, except for those consents, approvals, authorizations or orders that
previously have been obtained.
4. Neither the transfer of the Mortgage Loans as provided in the Agreement,
nor the fulfillment of the terms of or the consummation of any other of the
transactions contemplated by the Agreement, will result in a breach of any term
or provision of the certificate of incorporation or by-laws of the Seller or any
State of Georgia, State of Delaware or federal statute or regulation applicable
to the Seller, or to our knowledge, will conflict with, result in a breach,
violation or acceleration of or constitute a default under, the terms of any
indenture or other agreement or instrument to which the Seller is a party or by
which it is bound, or any order of any State of Georgia, State of Delaware or
federal court, regulatory body, administrative agency or governmental body
having jurisdiction over the Seller.
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<PAGE>
5. To our knowledge, there are no actions, proceedings, or investigations
pending or threatened against the Seller before any State of Georgia, State of
Delaware or federal court, administrative agency or other tribunal (a) asserting
the invalidity of the Agreement, (b) seeking to prevent the consummation of any
of the transactions contemplated in the Agreement, or (c) that might materially
and adversely affect the performance by the Seller of its obligations under, or
the validity or enforceability of the Agreement.
The opinion set forth above in paragraph 2 as to enforceability is subject
to and limited by the following:
(a) The effect of bankruptcy, insolvency, reorganization, moratorium and
other laws and court decisions of general application (including, without
limitation, laws relating to fraudulent conveyances, preferences and equitable
subordination) and other legal or equitable principles relating to, limiting or
affecting the enforcement of creditors' rights generally; and
(b) The discretion of any court of competent jurisdiction in awarding
equitable remedies, including, but not limited, to specific performance or
injunctive relief.
Where we have rendered our opinion concerning matters "known to us" or this
letter otherwise refers to our knowledge or our attention, such reference shall
mean only the knowledge of [ ], who are the attorneys in our firm primarily
responsible for our services relating to the Seller, and shall not refer to the
knowledge of any other person in any way associated with this firm. Furthermore,
such knowledge refers only to matters of which the attorneys named above are
consciously aware at the time of execution of this letter, and you are advised
that we have made no independent investigation or verification of such matters
and have not searched or reviewed the files and records of or relating to Seller
or such matters in our office, in the public records, in the possession of
Seller, or elsewhere.
In rendering this opinion letter, we do not express any opinion concerning
any law other than the law of the State of Georgia, the corporate law of the
State of Delaware and the federal law of the United States. In that regard, we
note that the Agreement provides that it is to be governed under the internal
laws of the State of New York. Therefore, our opinion in paragraph 2 above is
rendered on the assumption that pertinent New York law is identical to pertinent
Georgia law, as to the correctness of which assumption we render no opinion.
Further, we express no opinion as to the conflict of laws provisions of the
State of New York, the State of Georgia, or otherwise. We do not express any
opinion concerning the application of the "doing business" laws or the
securities laws of any jurisdiction.
Any and all opinions rendered by this firm in this opinion letter are
limited to the matters expressly set forth herein; and no opinion is implied or
to be inferred beyond the matters expressly so stated. This opinion is given as
of the date hereof, and we expressly decline any undertaking to revise or update
this opinion subsequent to the date hereof or to advise you of any matter
arising subsequent to the date hereof, which would cause us to modify the
opinion, in whole or in part.
-3-
<PAGE>
This opinion letter is rendered for the sole benefit of each addressee
hereof, and no other person is entitled to rely hereon. Copies of this letter
may not be furnished to any other person, nor may any portion of this letter be
quoted, circulated or referred to in any other document.
Very truly yours,
-4-
<PAGE>
Schedule 1
Mortgage Loan Schedule
<PAGE>
Schedule 2
Third Party Originator Agreements
THIRD PARTY ORIGINATOR THIRD PARTY ORIGINATOR AGREEMENT
1. ARCS Commercial Mortgage Co., Seller's Warranty Certificate dated as of
L.P. ("ARCS") February 20, 1998, from ARCS in favor of
DLJ Mortgage Capital, Inc. ("DLJMCI")
2. Union Capital Investments, LLC Seller's Warranty Certificate dated as of
("Union Capital") February 22, 1998, from Union Capital in
favor of DLJMCI
<PAGE>
EXHIBIT N-1
FORM OF THIRD PARTY ORIGINATOR AGREEMENT WITH ARCS
N-1-1
<PAGE>
SELLER'S WARRANTY CERTIFICATE
This Seller's Warranty Certificate, dated as of February 20, 1998 (this
"Seller's Warranty Certificate"), is executed and delivered by ARCS Commercial
Mortgage Co., L.P. (the "Seller"), in favor of DLJ Mortgage Capital, Inc.
("DLJMC"), its successors and assigns.
PRELIMINARY STATEMENT
The Seller and DLJMC are parties to a Master Mortgage Loan Purchase
Agreement dated as of November 4, 1996 (the "Master Agreement") and amended as
of October 31, 1997. The mortgage loan or, if more than one, the mortgage loans
(in either case, the "Mortgage Loans") identified on the Mortgage Loan Schedule
attached as Schedule 1 hereto have been previously sold by the Seller to DLJMC
pursuant to (or otherwise in a sale intended to be governed by) the Master
Agreement. DLJMC intends to transfer the Mortgage Loans to Column Financial,
Inc. ("Column") pursuant to a Bill of Sale (the "DLJMC - Column Agreement");
Column in turn intends to transfer the Mortgage Loans to DLJ Commercial Mortgage
Corp. (the "Depositor") pursuant to a Mortgage Loan Purchase and Sale Agreement
(the "Column - Depositor Agreement"); and the Depositor in turn intends to
deposit the Mortgage Loans into a trust fund to be evidenced by the Depositor's
Commercial Mortgage Pass-Through Certificates, Series 1998- CF1 (the
"Certificates"). The Certificates will be issued on or about March 2, 1998 (the
actual date of initial issuance, the "Issue Date") pursuant to a Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), to be dated as of
March 1, 1998 among the Depositor, Banc One Mortgage Capital Markets, LLC, as
servicer, Clarion Partners, LLC, as special servicer, and Norwest Bank
Minnesota, N.A., as trustee (in such capacity, the "Trustee") and REMIC
administrator. The Seller agreed in the Master Agreement to make certain
representations and warranties, repurchase certain Mortgage Loans and provide
certain indemnification in connection with any sale of the Mortgage Loans to a
trust fund to be formed as part of a mortgage pass-through transaction, and such
agreement was partial consideration for the execution and performance of the
Master Agreement by DLJMC. Capitalized terms used but not defined herein shall
have the respective meanings assigned to such terms in the Master Agreement or,
if not defined in the Master Agreement, shall have the respective meanings
assigned to such terms in the Pooling and Servicing Agreement.
Pursuant to the terms of the DLJMC - Column Agreement, DLJMC shall assign
to Column all of DLJMC's right, title and interest in and to the Mortgage Loans
and under this Seller's Warranty Certificate (except under Section 4 hereof);
pursuant to the Column - Depositor Agreement, Column shall assign to the
Depositor, among other things, all of Column's right, title and interest in and
to the Mortgage Loans and, to the extent assigned to it under the DLJMC Column
Agreement, under this Seller's Warranty Certificate; and pursuant to the Pooling
and Servicing Agreement, the Depositor shall assign to the Trustee, for the
benefit of the holders of the Certificates (the "Certificateholders"), among
other things, all of the Depositor's right, title and interest in and to the
Mortgage Loans and, to the extent assigned to it under the Column Depositor
Agreement, under this Seller's Warranty Certificate.
<PAGE>
SECTION 1. Delivery of Mortgage Files. The Seller agrees that it shall
deliver to the Trustee as assignee of the Depositor (or, if so directed by
DLJMC, to a custodian appointed by the Trustee (a "Custodian")), under the
Pooling and Servicing Agreement, all of the documents required in the Mortgage
Files, at the times and in the manner otherwise required by the Pooling and
Servicing Agreement, in each case to the extent the Seller has not delivered
such documents to DLJMC prior to the date hereof.
SECTION 2. Representations and Warranties of the Seller. Pursuant to
Sections 4.01, 4.02 and 7.01 of the Master Agreement, the Seller hereby
represents and warrants as of the Issue Date to and for the benefit of DLJMC,
Column, the Depositor, their affiliates, the Trustee and the Certificateholders
that (a) each of the representations and warranties set forth in Section 4.01 of
the Master Agreement is true and correct as if stated and made on the Issue Date
hereunder and (b) each of the representations and warranties set forth in
Section 4.02 of the Master Agreement was true and correct on the "Closing Date"
under the Master Agreement (as such term is defined therein) with respect to
each Mortgage Loan and, to the best of the Seller's knowledge (without imposing
any additional duties and burdens on the Seller other than those incidental to
servicing the Mortgage Loans), is true and correct as if stated and made on the
Issue Date hereunder. The Seller agrees that it shall be deemed to make as of
the date of substitution with respect to any Replacement Mortgage Loan (as
defined in the Pooling and Servicing Agreement) that is substituted by the
Seller for a Mortgage Loan in the manner set forth in Section 3 hereof, to and
for the benefit of DLJMC, Column, the Depositor, their affiliates, the Trustee
and the Certificateholders, each of the representations and warranties set forth
in Sections 4.01 and 4.02 of the Master Agreement as if stated and made on the
date of substitution, with any conforming changes necessary due to the fact that
such Replacement Mortgage Loan was not purchased pursuant to the Master
Agreement.
SECTION 3. Cure, Repurchase, Substitution and Indemnity Obligations of the
Seller. Each of the representations and warranties contained and/or referred to
in Section 2 shall survive the transfer of the Mortgage Loans by DLJMC to
Column, by Column to the Depositor and by the Depositor to the Trustee, for the
benefit of the Certificateholders, and shall inure to the benefit of DLJMC and
its successors and assigns (the holder(s) of any Mortgage Loan or REO Property,
including, without limitation, the Trustee for the benefit of the
Certificateholders, being herein referred to as the "Owner" thereof),
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
assignment of Mortgage or DLJMC's, Column's, the Depositor's or the Trustee's
examination of any Mortgage File. Upon discovery by either the Seller or the
related Owner of a breach of any of the foregoing representations and warranties
with respect to any Mortgage Loan or REO Property that materially and adversely
affects the value of such Mortgage Loan or REO Property or the interest of the
related Owner therein (any such breach, a "Material Breach"), the party
discovering such breach shall give prompt written notice to the other.
Within sixty (60) days of the earlier of either discovery by or notice to
the Seller of any Material Breach (other than a Material Breach involving any
representation or warranty made pursuant to Section 2 hereof that is set forth
in Section 4.01 of the Master Agreement), the Seller shall use its best efforts
to cure such Material Breach in all material respects and, if such Material
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<PAGE>
Breach cannot be cured within such 60-day period, the Seller shall, at the
related Owner's option, repurchase the affected Mortgage Loan or REO Property at
the Repurchase Price (as defined in the Master Agreement); provided, however,
that if the Seller's obligation to repurchase such affected Mortgage Loan or REO
Property as described above arises within the three-month period commencing on
the Issue Date (or within the two-year period commencing on the Issue Date if
the affected Mortgage Loan or REO Property is a "defective obligation" within
the meaning of Section 860G(a)(4)(B)(ii) of the Code and Treasury Regulation
Section 1.860G-2(f)), and if the affected Mortgage Loan or REO Property is then
subject to the Pooling and Servicing Agreement and is not a Mortgage Loan that
(or REO Property related to a Mortgage Loan that) had been substituted for a
Mortgage Loan in the manner described hereinbelow, the Seller may, at its
option, in lieu of repurchasing such affected Mortgage Loan (but no later than
the repurchase would have to have been completed), (a) replace such affected
Mortgage Loan or REO Property with one or more Qualifying Substitute Mortgage
Loans (as defined in the Pooling and Servicing Agreement) that are approved by
Column and pay any corresponding Substitution Shortfall Amount (as defined in
the Pooling and Servicing Agreement), such substitution and payment to be
effected in accordance with the terms of the Pooling and Servicing Agreement,
and (b) deliver a certification to the Trustee to the effect that such
substitute mortgage loan satisfies or such substitute mortgage loans satisfy, as
the case may be, all of the requirements of the definition of "Qualifying
Substitute Mortgage Loan" in the Pooling and Servicing Agreement. The Seller may
request that the related Owner extend the 60-day period referenced above within
which the Seller must cure, repurchase or replace a Mortgage Loan or REO
Property affected by such a Material Breach, to ninety (90) or more days (but
not more than one hundred fifty (150) days) following the earlier of either
discovery by or notice to the Seller of such Material Breach, by delivering a
written request to the related Owner, together with evidence that the Seller is
diligently proceeding to cure such breach and will require the requested
extension to effect such cure; provided, however, that the related Owner may
determine to accept or deny any such request in its sole discretion, without
limitation. For purposes of this section, no such request shall be deemed to
have been accepted by the related Owner unless the related Owner has
affirmatively and expressly stated in writing its acceptance of such request. If
a Material Breach involves any representation or warranty made pursuant to
Section 2 hereof that is set forth in Section 4.01 of the Master Agreement and
such Material Breach cannot be cured within ninety (90) days of the earlier of
either discovery by or notice to the Seller of such Material Breach, any or all
of the Mortgage Loans and/or REO Properties shall, at the option of the related
Owner, be repurchased (with no option to substitute) by the Seller at the
applicable aggregate Repurchase Price. Any repurchase of Mortgage Loans and/or
REO Properties or payment of any Substitution Shortfall Amount pursuant to the
foregoing provisions of this Section 3 shall be accomplished by wire transfer of
immediately available funds in the amount of the Repurchase Price or
Substitution Shortfall Amount, as applicable, pursuant to wiring instructions
furnished by the related Owner to the Seller.
At the time of the repurchase of or substitution for any Mortgage Loan or
REO Property as contemplated by the preceding paragraph, the related Owner and
Seller shall arrange for the reassignment of such Mortgage Loan or the
conveyance of such REO Property, as the case may be, to the Seller and the
delivery to the Seller of any documents held by or on behalf of the related
-3-
<PAGE>
Owner relating to such Mortgage Loan or REO Property, as the case may be. With
respect to each Mortgage Loan and REO Property to be repurchased or replaced as
contemplated by the preceding sentence, at the time the Repurchase Price or
Substitution Shortfall Amount, as applicable, is wire transferred to or at the
direction of the related Owner, the Seller shall, simultaneously with the
initiation of such wire transfer, give written notice to the related Owner that
such wire transfer has been initiated.
In addition to such cure and repurchase or substitution obligation, the
Seller shall indemnify the related Owner and hold it harmless against any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments, and other costs and expenses incurred in
connection with any claim, demand, defense, or assertion based on or grounded
upon, or resulting from, a breach by the Seller of the representations and
warranties made pursuant to Section 2 hereof. The obligations of the Seller set
forth in this Section 3 to cure or to repurchase or replace a defective Mortgage
Loan or REO Property and to indemnify the related Owner as provided in this
Section 3 constitute the sole remedies of the related Owner respecting a breach
of the foregoing representations and warranties.
SECTION 4. Indemnification. (a) The Seller will indemnify and hold harmless
DLJMC, Column, the Depositor, their affiliates, and each Person, if any, who
controls DLJMC, Column or the Depositor within the meaning of the Securities Act
of 1933, as amended (the "Securities Act"; and all of the foregoing Persons,
collectively, "DLJ"), against any losses, claims, damages or liabilities to
which DLJ may become subject, under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
(each, a "Liability") arise out of or are based upon any untrue statement of any
material fact contained in any written information regarding the Seller provided
by the Seller to DLJ ("Seller Information") for inclusion in the prospectus,
private placement memorandum and/or other disclosure document or any amendment
or supplement thereto (each, an "Offering Document") relating to the offering of
any securities evidencing ownership interests in the Mortgage Loans or which
arise out of or are based upon any omission to state in the Seller Information 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; and will reimburse DLJ for any legal or other expenses reasonably
incurred by DLJ in connection with investigating or defending any such
Liability.
(b) Promptly after receipt by a party with a right to indemnification under
this section (an "Indemnified Party") of notice of the commencement of any
action, such Indemnified Party will, if a claim in respect thereof is to be made
against the Seller (the "Indemnifying Party") under this section notify the
Indemnifying Party of the commencement thereof; but the omission so to notify
the Indemnifying Party will not relieve the Indemnifying Party from any
liability which it may have to any Indemnified Party otherwise than under this
section. In case any such action is brought against an Indemnified Party, and it
notifies the Indemnifying Party of the commencement thereof, the Indemnifying
Party will be entitled to participate therein, and to the extent that it may
elect by written notice delivered to the Indemnified Party promptly after
receiving the aforesaid notice from such Indemnified Party, to assume the
defense thereof, with counsel satisfactory to such Indemnified Party; provided,
however, that, if the defendants in any such action include both
-4-
<PAGE>
the Indemnified Party and the Indemnifying Party and the Indemnified Party shall
have reasonably considered that there may be legal defenses available to it
and/or other Indemnified Parties which are different from or additional to those
available to the Indemnifying Party, the Indemnified Party or Parties shall have
the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
Indemnified Party or Parties. Upon receipt of notice by such Indemnified Party
of the Indemnifying Party's election to so assume the defense of such action and
approval by such Indemnified Party of counsel, the Indemnifying Party will not
be liable to such Indemnified Party under this section for any legal or other
expenses subsequently incurred by such Indemnified Party in connection with the
defense thereof unless (i) the Indemnified Party shall have employed separate
counsel in connection with the assertion of legal defenses in accordance with
the proviso to the preceding sentence (it being understood, however, that the
Indemnifying Party shall not be liable for the expenses of more than one such
separate counsel), (ii) the Indemnifying Party shall not have employed counsel
satisfactory to the Indemnified Party within a reasonable period after notice of
commencement of the action or (iii) the Indemnifying Party has authorized the
employment of counsel for the Indemnified Party at the expense of the
Indemnifying Party; and except that if clause (i) or (iii) is applicable, such
liability shall be only in respect of the counsel referred to in clause (i) or
(iii).
(c) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in subsection (a) of
this Section 4 is for any reason held to be unenforceable although applicable in
accordance with its terms, the Seller on the one hand, and DLJMC on the other,
shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by said indemnity agreement incurred by DLJ
in such proportions that DLJ is responsible for its pro rata portion of such
losses, liabilities, claims, damages and expenses determined in accordance with
the ratio that (i) the difference between the purchase price paid to the Seller
by DLJMC for the Mortgage Loans and the aggregate resale price received by
DLJMC, bears to (ii) the aggregate resale price received by DLJMC, and the
Seller shall be responsible for the balance; provided, however, that no Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation. For purposes of this section,
each Person, if any, who controls DLJ within the meaning of Section 15 of the
Securities Act shall have the same rights to contribution as DLJ.
SECTION 5. Assignment of this Seller's Warranty Certificate. The rights and
obligations of the Seller under this Seller's Warranty Certificate may not be
assigned, pledged or hypothecated by the Seller without the consent of DLJMC and
its successors and assigns; except that any Person into which the Seller may be
merged or consolidated, or any corporation resulting from any merger, conversion
or consolidation to which the Seller shall be a party, or any Person succeeding
to the business of the Seller, shall be the successor of the Seller 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
rights and obligations of DLJMC under this Seller's Warranty Certificate may,
however, be assigned in whole or in part by DLJMC and its successors and assigns
in connection with any transfer of one or more Mortgage Loans. Without limiting
the
-5-
<PAGE>
generality of the foregoing, the Seller hereby acknowledges and approves the
assignments contemplated in the Preliminary Statement hereto.
SECTION 6. Seller's Warranty Certificate Supersedes Contrary Provisions in
Master Agreement. This Seller's Warranty Certificate supersedes any contrary
provisions of the Master Agreement, and constitutes an amendment of such
contrary provisions, insofar as (but only insofar as) such contrary provisions
of the Master Agreement relate to the Mortgage Loans. The rights and obligations
of the Seller and DLJMC under the Master Agreement are otherwise unaffected, and
the provisions of the Master Agreement otherwise remain in full force and
effect.
-6-
<PAGE>
IN WITNESS WHEREOF, the Seller has caused its name to be signed by its duly
authorized officer as of the date first above written.
ARCS COMMERCIAL MORTGAGE CO., L.P.
By:_________________________________
Name:_______________________________
Title:______________________________
Acknowledged and Accepted
DLJ MORTGAGE CAPITAL, INC.
By: _____________________________
Name: ___________________________
Title: __________________________
<PAGE>
SCHEDULE 1
Mortgage Loan Schedule
Property Name Manager Address Originator
- - ------------- ------- ------- ----------
<PAGE>
EXHIBIT N-2
FORM OF THIRD PARTY ORIGINATOR AGREEMENT WITH UNION CAPITAL
N-2-1
<PAGE>
SELLER'S WARRANTY CERTIFICATE
This Seller's Warranty Certificate, dated as of February 22, 1998 (this
"Seller's Warranty Certificate"), is executed and delivered by Union Capital
Investments, LLC (the "Seller"), in favor of DLJ Mortgage Capital, Inc.
("DLJMC"), its successors and assigns.
PRELIMINARY STATEMENT
The Seller and DLJMC are parties to a Master Mortgage Loan Purchase
Agreement dated as of January 23, 1996 (the "Master Agreement") and amended as
of February 22, 1998. The mortgage loan or, if more than one, the mortgage loans
(in either case, the "Mortgage Loans") identified on the Mortgage Loan Schedule
attached as Schedule 1 hereto have been previously sold by the Seller to DLJMC
pursuant to the Master Agreement. DLJMC intends to transfer the Mortgage Loans
to Column Financial, Inc. ("Column") pursuant to a Bill of Sale (the "DLJMC
Column Agreement"); Column in turn intends to transfer the Mortgage Loans to DLJ
Commercial Mortgage Corp. (the "Depositor") pursuant to a Mortgage Loan Purchase
and Sale Agreement (the "Column - Depositor Agreement"); and the Depositor in
turn intends to deposit the Mortgage Loans into a trust fund to be evidenced by
the Depositor's Commercial Mortgage Pass-Through Certificates, Series 1998-CF1
(the "Certificates"). The Certificates will be issued on or about March 2, 1998
(the actual date of issuance, the "Closing Date") pursuant to a Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), to be dated as of
March 1, 1998, among the Depositor, Banc One Mortgage Capital Markets, LLC, as
servicer, Clarion Partners, LLC, as special servicer, and Norwest Bank
Minnesota, N.A., as trustee (in such capacity, the "Trustee") and REMIC
administrator. The Seller agreed in the Master Agreement to make certain
representations and warranties, repurchase certain Mortgage Loans and provide
certain indemnification in connection with any sale of the Mortgage Loans to a
trust fund to be formed as part of a mortgage pass-through transaction, and such
agreement was partial consideration for the execution and performance of the
Master Agreement by DLJMC. Capitalized terms used but not defined herein shall
have the respective meanings assigned to such terms in the Master Agreement or,
if not defined in the Master Agreement, shall have the respective meanings
assigned to such terms in the Pooling and Servicing Agreement.
Pursuant to the terms of the DLJMC - Column Agreement, DLJMC shall assign
to Column all of DLJMC's right, title and interest in and to the Mortgage Loans
and under this Seller's Warranty Certificate (except under Section 4 hereof);
pursuant to the Column - Depositor Agreement, Column shall assign to the
Depositor, among other things, all of Column's right, title and interest in and
to the Mortgage Loans and, to the extent assigned to it under the DLJMC Column
Agreement, under this Seller's Warranty Certificate; and pursuant to the Pooling
and Servicing Agreement, the Depositor shall assign to the Trustee, for the
benefit of the holders of the Certificates (the "Certificateholders"), among
other things, all of the Depositor's right, title
<PAGE>
and interest in and to the Mortgage Loans and, to the extent assigned to it
under the Column Depositor Agreement, under this Seller's Warranty Certificate.
SECTION 1. Delivery of Mortgage Files. The Seller agrees that it shall
deliver to the Trustee as assignee of the Depositor (or, if so directed by
DLJMC, to a custodian appointed by the Trustee (a "Custodian")), under the
Pooling and Servicing Agreement, all of the documents required in the Mortgage
Files, at the times and in the manner otherwise required by the Pooling and
Servicing Agreement, in each case to the extent the Seller has not delivered
such documents to DLJMC prior to the date hereof.
SECTION 2. Representations and Warranties of the Seller. Pursuant to
Section 7.01 of the Master Agreement, the Seller hereby represents and warrants
as of the Closing Date to and for the benefit of DLJMC, Column, the Depositor,
their affiliates, the Trustee and the Certificateholders that (a) each of the
representations and warranties set forth in Section 4.01 and Section 4.02 of the
Master Agreement is true and correct as if stated and made on the Closing Date
hereunder and (b) that each Mortgage Loan bears interest at a rate that remains
fixed throughout the term of such Mortgage Loan. The Seller agrees that it shall
be deemed to make as of the date of substitution with respect to any Replacement
Mortgage Loan (as defined in the Pooling and Servicing Agreement) that is
substituted by the Seller for a Mortgage Loan in the manner set forth in Section
3 hereof, to and for the benefit of DLJMC, Column, the Depositor, their
affiliates, the Trustee and the Certificateholders, each of the representations
and warranties set forth in Sections 4.01 and 4.02 of the Master Agreement as if
stated and made on the date of substitution, with any conforming changes
necessary due to the fact that such Replacement Mortgage Loan was not purchased
pursuant to the Master Agreement.
SECTION 3. Cure, Repurchase, Substitution and Indemnity Obligations of the
Seller. Each of the representations and warranties contained and/or referred to
in Section 2 shall survive the transfer of the Mortgage Loans by DLJMC to
Column, by Column to the Depositor and by the Depositor to the Trustee, for the
benefit of the Certificateholders, and shall inure to the benefit of DLJMC and
its successors and assigns (the holder(s) of any Mortgage Loan or REO Property,
including, without limitation, the Trustee for the benefit of the
Certificateholders, being herein referred to as the "Owner" thereof),
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
assignment of Mortgage or DLJMC's, Column's, the Depositor's or the Trustee's
examination of any Mortgage File. Upon discovery by either the Seller or the
related Owner of a breach of any of the foregoing representations and warranties
with respect to any Mortgage Loan or REO Property that materially and adversely
affects the value of such Mortgage Loan or REO Property or the interest of the
related Owner therein (any such breach, a "Material Breach"), the party
discovering such breach shall give prompt written notice to the other.
Within sixty (60) days of the earlier of either discovery by or notice to
the Seller of any Material Breach (other than a Material Breach involving any
representation or warranty made pursuant to Section 2 hereof that is set forth
in Section 4.01 of the Master Agreement), the Seller shall use its best efforts
to cure such Material Breach in all material respects and, if such Material
Breach cannot be cured within such 60-day period, the Seller shall, at the
related Owner's option,
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repurchase the affected Mortgage Loan or REO Property at the Purchase Price (as
defined in the Pooling and Servicing Agreement); provided, however, that if the
Seller's obligation to repurchase such affected Mortgage Loan or REO Property as
described above arises within the three-month period commencing on the Closing
Date (or within the two-year period commencing on the Closing Date if the
affected Mortgage Loan or REO Property is a "defective obligation" within the
meaning of Section 860G(a)(4)(B)(ii) of the Code and Treasury Regulation Section
1.860G- 2(f)), and if the affected Mortgage Loan or REO Property is then subject
to the Pooling and Servicing Agreement and is not a Mortgage Loan that (or REO
Property related to a Mortgage Loan that) had been substituted for a Mortgage
Loan in the manner described hereinbelow, the Seller may, at its option, in lieu
of repurchasing such affected Mortgage Loan, (a) replace such affected Mortgage
Loan or REO Property with one or more Qualifying Substitute Mortgage Loans (as
defined in the Pooling and Servicing Agreement) that are approved by Column, (b)
pay any corresponding Substitution Shortfall Amount (as defined in the Pooling
and Servicing Agreement), such substitution and payment to be effected in
accordance with the terms of the Pooling and Servicing Agreement, and (c)
deliver a certification to the Trustee to the effect that such substitute
mortgage loan satisfies or such substitute mortgage loans satisfy, as the case
may be, all of the requirements of the definition of "Qualifying Substitute
Mortgage Loan" in the Pooling and Servicing Agreement. The Seller may request
that the related Owner extend the 60-day period referenced above within which
the Seller must cure, repurchase or replace a Mortgage Loan or REO Property
affected by such a Material Breach, to ninety (90) or more days (but not more
than one hundred fifty (150) days) following the earlier of either discovery by
or notice to the Seller of such Material Breach, by delivering a written request
to the related Owner, together with evidence that the Seller is diligently
proceeding to cure such breach and will require the requested extension to
effect such cure; provided, however, that the related Owner may determine to
accept or deny any such request in its sole discretion, without limitation. For
purposes of this section, no such request shall be deemed to have been accepted
by the related Owner unless the related Owner has affirmatively and expressly
stated in writing its acceptance of such request. If a Material Breach involves
any representation or warranty made pursuant to Section 2 hereof that is set
forth in Section 4.01 of the Master Agreement and such Material Breach cannot be
cured within ninety (90) days of the earlier of either discovery by or notice to
the Seller of such Material Breach, any or all of the Mortgage Loans and/or REO
Properties shall, at the option of the related Owner, be repurchased (with no
option to substitute) by the Seller at the Purchase Price. Any repurchase of
Mortgage Loans and/or REO Properties or payment of any Substitution Shortfall
Amount pursuant to the foregoing provisions of this Section 3 shall be
accomplished by wire transfer of immediately available funds in the amount of
the Purchase Price or Substitution Shortfall Amount, as applicable, pursuant to
wiring instructions furnished by the related Owner to the Seller.
At the time of the repurchase of or substitution for any Mortgage Loan or
REO Property as contemplated by the preceding paragraph, the related Owner and
Seller shall arrange for the reassignment of such Mortgage Loan or the
conveyance of such REO Property, as the case may be, to the Seller and the
delivery to the Seller of any documents held by or on behalf of the related
Owner relating to such Mortgage Loan or REO Property, as the case may be. With
respect to each Mortgage Loan and REO Property to be repurchased or replaced as
contemplated by the
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preceding sentence, at the time the Purchase Price or Substitution Shortfall
Amount, as applicable, is wire transferred to or at the direction of the related
Owner, the Seller shall, simultaneously with the initiation of such wire
transfer, give written notice to the related Owner that such wire transfer has
been initiated.
In addition to such cure and repurchase or substitution obligation, the
Seller shall indemnify the related Owner and hold it harmless against any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments, and other costs and expenses incurred in
connection with any claim, demand, defense, or assertion based on or grounded
upon, or resulting from, a breach by the Seller of the representations and
warranties made pursuant to Section 2 hereof. The obligations of the Seller set
forth in this Section 3 to cure or to repurchase or replace a defective Mortgage
Loan or REO Property and to indemnify the related Owner as provided in this
Section 3 constitute the sole remedies of the related Owner respecting a breach
of the foregoing representations and warranties.
SECTION 4. Indemnification. (a) The Seller will indemnify and hold harmless
DLJMC, Column, their affiliates, and each Person, if any, who controls DLJMC or
Column within the meaning of the Securities Act of 1933, as amended (the
"Securities Act"; and all of the foregoing Persons, collectively, "DLJ"),
against any losses, claims, damages or liabilities to which DLJ may become
subject, under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) (each, a "Liability")
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact provided by the Seller to DLJ ("Seller Information") which
is contained in the prospectus, private placement memorandum and/or other
disclosure document or any amendment or supplement thereto (each, an "Offering
Document") relating to the offering of any securities evidencing ownership
interests in the Mortgage Loans or which arise out of or are based upon any
omission or alleged omission to state in such Offering Document 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; and
will reimburse DLJ for any legal or other expenses reasonably incurred by DLJ in
connection with investigating or defending any such Liability; provided,
however, that the Seller shall not be liable in any such case to the extent and
only to the extent that any Liability arises out of or is based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in an
Offering Document in reliance upon and in conformity with information provided
by or on behalf of any Person other than the Seller. DLJMC hereby agrees to
indemnify the Seller for any Liability arising out of or based upon Seller
Information which is not accurately reflected in any Offering Document.
(b) Promptly after receipt by a party with a right to indemnification under
this section (an "Indemnified Party") of notice of the commencement of any
action, such Indemnified Party will, if a claim in respect thereof is to be made
against a party with an indemnification obligation under this section (the
"Indemnifying Party"), notify the Indemnifying Party of the commencement
thereof; but the omission so to notify the Indemnifying Party will not relieve
the Indemnifying Party from any liability which it may have to any Indemnified
Party otherwise than under this section. In case any such action is brought
against an Indemnified Party, and it notifies
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the Indemnifying Party of the commencement thereof, the Indemnifying Party will
be entitled to participate therein, and to the extent that it may elect by
written notice delivered to the Indemnified Party promptly after receiving the
aforesaid notice from such Indemnified Party, to assume the defense thereof,
with counsel satisfactory to such Indemnified Party; provided, however, that, if
the defendants in any such action include both the Indemnified Party and the
Indemnifying Party and the Indemnified Party shall have reasonably considered
that there may be legal defenses available to it and/or other Indemnified
Parties which are different from or additional to those available to the
Indemnifying Party, the Indemnified Party or Parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such Indemnified Party or
Parties. Upon receipt of notice by such Indemnified Party of the Indemnifying
Party's election to so assume the defense of such action and approval by such
Indemnified Party of counsel, the Indemnifying Party will not be liable to such
Indemnified Party under this section for any legal or other expenses
subsequently incurred by such Indemnified Party in connection with the defense
thereof unless (i) the Indemnified Party shall have employed separate counsel in
connection with the assertion of legal defenses in accordance with the proviso
to the preceding sentence (it being understood, however, that the Indemnifying
Party shall not be liable for the expenses of more than one separate counsel),
(ii) the Indemnifying Party shall not have employed counsel satisfactory to the
Indemnified Party within a reasonable period after notice of commencement of the
action or (iii) the Indemnifying Party has authorized the employment of counsel
for the Indemnified Party at the expense of the Indemnifying Party; and except
that if clause (i) or (iii) is applicable, such liability shall be only in
respect of the counsel referred to in clause (i) or (iii).
(c) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in subsection (a) of
this Section 4 is for any reason held to be unenforceable although applicable in
accordance with its terms, the Seller on the one hand, and DLJMC on the other,
shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by said indemnity agreement incurred by the
Seller and DLJ in such proportions that DLJ is responsible for its pro rata
portion of such losses, liabilities, claims, damages and expenses determined in
accordance with the ratio that the (i) difference between the purchase price
paid to the Seller by DLJMC for the Mortgage Loans and the aggregate resale
price received by DLJMC, bears to (ii) the purchase price paid to the Seller by
DLJMC, and the Seller shall be responsible for the balance; provided, however,
that no Person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
Person who was not guilty of such fraudulent misrepresentation. For purposes of
this section, each Person, if any, who controls DLJ within the meaning of
Section 15 of the Securities Act shall have the same rights to contribution as
DLJ.
SECTION 5. Assignment of this Seller's Warranty Certificate. The rights and
obligations of the Seller under this Seller's Warranty Certificate may not be
assigned, pledged or hypothecated by the Seller without the consent of DLJMC and
its successors and assigns; except that any Person into which the Seller may be
merged or consolidated, or any corporation resulting from any merger, conversion
or consolidation to which the Seller shall be a party, or any Person succeeding
to the business of the Seller, shall be the successor of the Seller hereunder,
without the execution
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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 rights and
obligations of DLJMC under this Seller's Warranty Certificate may, however, be
assigned in whole or in part by DLJMC and its successors and assigns in
connection with any transfer of one or more Mortgage Loans. Without limiting the
generality of the foregoing, the Seller hereby acknowledges and approves the
assignments contemplated in the Preliminary Statement hereto.
SECTION 6. Seller's Warranty Certificate Supersedes Contrary Provisions in
Master Agreement. This Seller's Warranty Certificate supersedes any contrary
provisions of the Master Agreement, and constitutes an amendment of such
contrary provisions, insofar as (but only insofar as) such contrary provisions
of the Master Agreement relate to the Mortgage Loans. The rights and obligations
of the Seller and DLJMC under the Master Agreement are otherwise unaffected, and
the provisions of the Master Agreement otherwise remain in full force and
effect.
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IN WITNESS WHEREOF, the Seller has caused its name to be signed by its duly
authorized officer as of the date first above written.
UNION CAPITAL INVESTMENTS, LLC
By:_________________________________
Name:_______________________________
Title:______________________________
Acknowledged and Accepted:
DLJ MORTGAGE CAPITAL, INC.
By:_______________________________
Name:_____________________________
Title:____________________________
<PAGE>
SCHEDULE 1
Mortgage Loan Schedule
Property Name Manager Address Originator
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